Looking At The Financial Status Of Parties When One Seeks To Terminate Alimony in New Jersey; A Case Study
Picture this scenario. About ten years ago, a client comes to my office seeking a divorce. He and his soon to be ex-wife have moderate level income and do not have many assets to be distributed. At the time, the client is making five figures, yet the couple has grown accustomed to the lifestyle they can afford. After all, they have been married for almost twenty years and have received minimal drastic increases in their paychecks. When their New Jersey divorce settles, their property settlement agreement will include a figure that has been agreed upon by both parties in order to determine child support and how much he will pay in alimony.
Just when you think the case is closed, something new happens that changes everything. Your client has been promoted at work soon after the divorce and goes from earning five figures to six figures (trust me, the promotion increases his salary by double the amount). Years go by and he finally decides to retire. His benefits are determined and his former wife’s alimony is adjusted to take into account the spike in income her ex-husband had earned. Yet, soon after your client comes to again wanting to file a motion to terminate his alimony payments altogether. What do you do in a case like this? How do you respond to this dilemma your client has just proposed? The Superior Court of New Jersey, Appellate Division recently decided the case of Krupinski v. Krupinski, which addresses this very dilemma. Let’s explore.
In Krupinski, the parties were married in 1968. Two children were born of the marriage and at the time of the lawsuit were emancipated adults. In 1988, the parties separated and entered into a property settlement agreement with one another, which became part of the final judgment of divorce in 1990. At the time of the separation, defendant was a school teacher earning $45, 798.28 annually. Additionally, he was enrolled in the Public Employment Retirement System.
When it came time for the defendant to retire, he had accumulated over 41 years of service in the Public Employment Retirement System. Importantly, throughout those 41 years of service, the defendant enjoyed the benefit of a promotion later in his career, particularly after he and his wife separated. New Jersey's Division of Pensions and Benefits calculated his retirement benefits based on a yearly salary of $132, 210.97, practically three times the amount that he was earning while married as a teacher. The plaintiff’s share was approximately $1,871 per month. Additionally laid forth in the property settlement agreement was a discussion of alimony and termination thereof. Termination of alimony would only occur if the plaintiff had died, remarried, or cohabitated with someone she was not related to by blood or marriage i.e. a new boyfriend.
In April of 2010, the defendant filed a motion to terminate his alimony obligation. The motion was denied. Acknowledging that there was a change in circumstances, the standard to prove in order to terminate or modify an agreement, the court found that the defendant was able to meet his alimony obligation and therefore it should not be terminated. The defendant appealed.
On appeal, the Appellate Division reversed the findings of the lower court and remanded the case for the Family Part. The Appellate Division looked to the financial status of the parties. It noted that the plaintiff’s lifestyle had improved once she became entitled to receive part of her ex-husband’s pension plan. And since he had received a significant raise, she too was being paid more than anticipated. The Appellate Division therefore found it unnecessary for her to receive alimony payments as well, as the money received from the pension was far enough to support her quality of life she had been accustomed to.
This area of the law, particularly termination of alimony, is very fact specific. A court will look to see if the circumstances of the parties have changed and the style of life they have maintained throughout the marital life. For more information on this hot area of the law or for general questions contact my New Jersey divorce law firm today. Thank you.