New Jersey Alimony Laws Are Not Retroactive Before September 2014
Timing is everything. Divorce law is constantly evolving in the State of New Jersey, especially with respect to alimony. The attorneys at my divorce law firm know how to keep up and evolve with the fallout of the significant changes to New Jersey’s alimony laws in 2014. Our attorneys study each new case as it comes down from the New Jersey Appellate Division. Under the 2014 amendment to the alimony law, New Jersey Statute 2A:34-23, an alimony obligation can be terminated upon the supported spouse’s cohabitation with another person. This amendment, however, has an “anti-retroactivity” provision, so it only applies to divorces filed after the 2014 effective date.
In Chernin v. Chernin, the New Jersey Appellate Division reversed an order of the Superior Court of New Jersey, Family Part, Bergen County, that terminated Samuel Chernin’s spousal obligation to pay alimony to his ex-wife, Bette Chernin, because she moved in with her new partner. The New Jersey Appellate Division held the order invalid because, amendment L. 2014, c. 42, §1 to New Jersey Statute 2A:34-23 contains an anti-retroactivity provision that limits the amendments scope to divorces filed after its effective date.
Samuel and Bette Chernin got married in 1958, and divorced 34 years later in 1992. Their final judgment of divorce incorporated a property settlement agreement, in which the parties mutually agreed that Samuel would pay Bette alimony in the amount of $ 100,000 every year until July 1, 1997. At that point the alimony obligation would increase to $ 150,000 a year. In addition, the property settlement agreement required Samuel to maintain a life insurance policy with Bette as the beneficiary, in the amount of $800,000, as long as he still had an alimony obligation.
Samuel filed a motion to retroactively terminate his alimony obligation in 1996, based on Bette’s cohabitation with another partner. A five-day plenary hearing ensued, and Samuel’s motion was granted in part by Judge Torack. The judge found that Bette was indeed cohabiting, and ordered her to reimburse Samuel for overpayments going back to the date that alimony payments started. This amount was $ 81,200. In addition, the judge reduced Samuel’s alimony obligation by $ 12,000 a year.
Samuel filed an appeal and argued that the judge should have terminated his alimony obligation instead of reducing it, as per the test adopted in the 1983 case of Gayet v. Gayet. Bette filed a cross-appeal, and contended that the court incorrectly concluded that she received any financial benefit from her cohabitation. According to Bette, her alimony payments should not have been reduced at all, and alternatively, even if they should have been reduced, that they should not have be retroactively reduced to the date the payments started, but rather to the date Samuel filed his motion. In 1998 the New Jersey Appellate Division rejected Samuel’s motion because the property settlement agreement did not contain any express language that stated that cohabitation would result in termination of the alimony obligation, and affirmed the reduction on the basis of Bette’s reduced need due to her cohabitation, but reversed the portion of the order that modifying the obligation retroactively to the date the payments started.
After amendment L. 2014, c. 42 § 1 was passed in 2014, Samuel filed another motion to terminate his alimony obligation due to cohabitation. Besides the new statutory amendments, nothing else had changed in the twenty years since the firt motion. Bette was still in the same relationship that she was in when her alimony was reduced, and Samuel was still gainfully employed and able to pay the alimony. The trial court heard oral argument and determined that the new amendments to N.J.S.A 2A:34-23, the alimony statute, constituted changed circumstances. The trial court applied the new amendments to the earlier finding of cohabitation, and terminated Samuel’s alimony obligation based on Bette’s continued cohabitation, and the fact that Samuel was now seventy-seven and at full retirement age.
Bette appealed the trial court decision and argued that the judge failed to consider the “anti-retroactivity provision” of the new alimony amendments. The New Jersey Appellate Division stated that the applicable standard of review on this appeal was de novo, because the only thing in question was the applicable law, and not the facts of the case. This means that the appellate panel was allowed to interpret the meaning of the statute, and did not need to defer to any interpretation of the trial court they may have deemed as incorrect.
The trial court applied subsection n of the amendments to the alimony statute which states that an alimony obligation can be terminated if the person receiving support starts to cohabitate with another person. However, the New Jersey Appellate Division noted that the trial court failed to consider the Legislative direction included in the amendments that specified the dates the law would become effective, and all the orders, agreements, and judgments that the amendments would not apply to. The amendment provided that it would take effect immediately, but could not modify: the duration of an alimony award incorporated in a final judgment of divorce, a final order concluding post-judgment litigation, or any enforceable agreement between the parties. The New Jersey Appellate Division reviewed this language and determined that the trial court should not have applied the 2014 amendments. In support, the appellate panel noted that the paramount goal in interpreting a statute is the Legislature’s intent.
Bette and Samuel incorporated a property settlement agreement into their divorce that governed the duration and amount of the alimony obligation. Samuel filed a motion in 1996 to terminate this obligation because of Bette’s cohabitation with another person. The court applied the law that was in effect at the time, and modified the amount of the alimony obligation, but not the duration. The final order entered in 1997 that reduced the alimony obligation was based on the support clause in the parties’ property settlement agreement modified by the trial court because of Bette’s cohabitation as per the existing law at that time. Because, the 2014 amendments state that they cannot alter: the duration of alimony agreed upon or ordered, bargained for provisions of a settlement agreement, or a judgement or order concluding post-judgment litigation, all of which applied here, the New Jersey Appellate Division found that the trial court was clearly incorrect in using the amendments to modify the permanent alimony award. The appellate panel supported this holding by citing the 2015 case of Spangenberg v. Kolakowski, which stated that the language of the 2014 amendments indicated the Legislature intended that prior agreements or orders entered before the effective date of the amendments must be upheld. The appellate panel also cited the 2015 New Jersey Supreme Court case of Gnall v. Gnall, which held that the 2014 amendments to the alimony statute were not applicable to an alimony award entered in 2010. Therefore, the New Jersey Appellate Division reversed the December 19, 2014 order that terminated alimony, and demanded that the trial court reinstate alimony in a just and equitable manner. The appellate panel stated that Samuel was still free to file a motion to modify his support obligation on a basis of changed circumstances.
Please contact my office if you have any questions regarding New Jersey’s “new” alimony laws.