Alimony is dictated by N.J.S.2A:34-23 including the amendment known as the New Jersey Alimony Reform Act.
The New Jersey State Supreme Court, in Crews v. Crews, 164 N.J. 11 (2000), ruled that the supported spouse’s standard of living during the marriage dictates alimony and any future modifications. The ruling extended the doctrine of Lepis v. Lepis, 83 N.J. 139 (1980), which said the goal of alimony is to assist the supported spouse in achieving a lifestyle “reasonably comparable” to the one during the marriage. The ruling in Lepis dictates that a substantial change in circumstances is grounds to revisit any financial award of support.
The Alimony Reform Act eliminates the misconception that the supported spouse is only entitled to maintain the marital lifestyle. Rather, the new law provides that neither party has greater entitlement to the standard of living (or a reasonably comparable standard of living) established during the marriage. In essence, if the supported spouse is to share in the benefit of the financial situation, they should also be compelled to share in any downturn in the financial situation, just as if they would if the marriage were still intact.
The Alimony Reform Act helps in several very important ways. Prior to the amendment a judge could simply deny an application for alimony modification by saying that not enough time had passed to establish a long-term change of circumstances – as dictated by Lepis - that would lead to a modification of alimony. That discretion is now mitigated as the judge is required to investigate whether there is a change of circumstances after 90 days of unemployment, and actually defines what a change of circumstance is by listing the factors for a judge to consider. And rather than being a clear cut “yes or no” issue, a judge can have the option to afford some flexibility to the payer and create a temporary modification dependent upon the actual circumstances.
The amendment to N.J.S.2A:34-23Alimony Reform Act states:
When a non-self-employed party seeks modification of alimony, the court shall consider the following factors:
(1) The reasons for any loss of income;
(2) Under circumstances where there has been a loss of employment, the obligor’s documented efforts to obtain replacement employment or to pursue an alternative occupation;
(3) Under circumstances where there has been a loss of employment, whether the obligor is making a good faith effort to find remunerative employment at any level and in any field;
(4) The income of the oblige; the obligee’s circumstances; and the obligee’s reasonable efforts to obtain employment in view of those circumstances and existing opportunities;
(5) The impact of the parties’ health on their ability to obtain employment;
(6) Any severance compensation or award made in connection with any loss of employment;
(7) Any changes in the respective financial circumstances of the parties that have occurred since the date of the order from which modification is sought;
(8) The reasons for any change in either party’s financial circumstances since the date of the order from which modification is sought, including, but not limited to, assessment of the extent to which either party’s financial circumstances at the time of the application are attributable to enhanced earnings or financial benefits received from any source since the date of the order;
(9) Whether a temporary remedy should be fashioned to provide adjustment of the support award from which modification is sought, and the terms of any such adjustment, pending continuing employment of investigations by the unemployed spouse or partner; and
(10) Any other factor the court deems relevant to fairly and equitably decide the application.
Under circumstances where the changed circumstances arise from the loss of employment, the length of time a party has been involuntarily unemployed or has had an involuntary reduction in income shall not be the only factor considered by the court when an application is filed by a non-self-employed party to reduce alimony because of involuntary loss of employment. The court shall determine the application based upon all of the enumerated factors, however, no application shall be filed until a party has been unemployed, or has not been able to return to or attain employment at prior income levels, or both, for a period of 90 days. The court shall have discretion to make any relief granted retroactive to the date of the loss of employment or reduction of income.
When a self-employed party seeks modification of alimony because of an involuntary reduction in income since the date of the order from which is sought, then that party’s application for relief must include an analysis that sets forth the economic and non-economic benefits the party receives from the business, and which compares these economic and non-economic benefits to those that were in existence at the time of the entry of the order.
Even prior the Alimony Reform Act, there are also case laws that have led the courts to approve a downward modification in spousal support.
In Kuron v. Hamilton, 331 N.J. Super 561 (App. Div. 2000) the Appellate Division approved a reduction in alimony and opined:
“It may seem counter-intuitive to permit a support obligor to avoid his or her payment responsibility, even partially or temporarily, based upon the consequences of his or her voluntary acts. However, the process of assessing and enforcing family obligation is not an exercise in intuitional rather, it calls for an evaluation and application of all the equitable considerations that emanate from the parties' relationships, understandings and circumstances at every significant junction.” Id. at 576.
In Miller v. Miller, 160, N.J. 408 (1999), the Appellate Division affirmed the trial court's determination that the payor spouse had demonstrated a significant change of circumstance after he lost his job.
In Storey v. Storey, 373 N.J. Super. 464 (App. Div. 2004), the Appellate Division held that in or order to obtain a reduction of alimony based on current earnings, a payor who selects a new, less lucrative career must establish that the benefits he or she derives from the career change substantially outweigh the disadvantages to the supported spouse. Absent that showing, the judge should deny the motion, and impute income based on prior earnings. However, the payor can still try to prove that his capacity to earn is diminished. Thereafter, the judge should then try to impute earnings consistent with the obligor's capacity to earn in light of this background and experience. The payor always has the burden of proof.
The courts, with the help of the Alimony Reform Act, have made it clear that a payor spouse now has a fair and fighting chance to find equity and reduce their alimony obligation when there is a definitive change in circumstances due to loss of income as a result of a loss or reduction of employment. And that the supported spouse must share in any downward turn in income, just as if the parties were still married.