There may not be a more polarizing term during a divorce proceeding, and even once a divorce is complete, than “alimony.” How your client feels about it inevitably depends upon whether he or she will be paying or receiving spousal support.
Alimony in New Jersey dates back to colonial times. The current statute (N.J.S.A. 2A:34-23 et seq.), however, has had no significant modifications for the last four decades (except, perhaps, for the addition of limited-duration alimony as an option for courts to award, in 1999). The law is intended to balance any inequities in the parties’ earning capacities and permit them to continue to live, as closely as possible, a lifestyle comparable to that enjoyed during their marriage.
The family court currently has broad discretion to determine an alimony award. Although guidelines and formulas have been established to determine child support, no such formulas or guidelines currently exist for setting alimony. Instead, N.J.S.A. 2A:34-23(b) outlines 13 factors a court must consider when making an alimony award, including the marital lifestyle, the supporting spouse’s ability to pay, and the dependent spouse’s ability to contribute to his or her own needs. The statute and case law allow for alimony to be modified upon a showing of material, ongoing “changed circumstances” by the party seeking the modification.
As a result of the struggling economy, changing mores, strong grassroots organizations, including New Jersey Alimony Reform (NJAR), and reform efforts in states like Massachusetts and Florida, there has been significant debate over the implementation of alimony guidelines, and legislators have introduced proposals (Senate Bills SJR34 and 41 and Assembly Bills AJR32 and 36) for the creation of a commission to study alimony reform and evaluate New Jersey’s laws compared to other states to determine whether New Jersey’s system could be improved.
Supporters of Reform
Proponents of reform seem to agree that alimony is a necessary tool to ensure a reasonable and fair financial outcome in a divorce. They also agree that a spouse who needs support should be given the time and resources to get on his or her feet. However, they take issue with “permanent” alimony awards, which they view as a lifetime entitlement that asks nothing of the recipient in return for the support. They see it as an incentive for the supported spouse to remain unemployed, dependent and unmarried (since alimony usually terminates upon the remarriage of the supported spouse).
Supporters of reform feel that the current system is skewed toward permanent alimony awards which fail to take into account practical and economic realities. They contend that permanent alimony was originally conceived at a time when the roles of both men and women in the home and the workplace were different than they are now, when women had no economic power and divorce was uncommon, and that it no longer reflects modern marriage or socio-economic trends. These alimony critics believe that the laws governing alimony should be rewritten to better reflect the modern roles of men and women because so many women now work outside the home and earn decent salaries. In fact, today it is not unusual for a wife to earn more money than her husband. NJAR argues that alimony laws should encourage a clean break and independence for divorcing couples. Their members believe that the objective of any alimony award should be a transition to independence and self-support in a reasonable and fair time period.
Alimony critics also take issue with the perceived difficulty in modifying alimony awards despite changed circumstances. They argue that unfettered judicial discretion regarding alimony has created an inflexible system that does not account for changes in life or financial circumstances. In support of their claims, alimony reformers have collected hundreds of “horror” stories which recount instances where requests for modification of alimony awards based on changed circumstances were denied, despite long-term unemployment, financial hardship, a failed business or retirement. They believe that the current income of the payor spouse should be the basis upon which alimony is determined.
Opponents of Reform
On the other hand, there are many who believe that New Jersey’s alimony laws should be left alone and that guidelines will not work. Opponents of the proposed changes argue that alimony reform is unnecessary and a waste of taxpayer money. They believe that alimony cannot be determined by formula or guidelines, as child support is, because most model guidelines eliminate judicial discretion and opportunity for diligent advocacy.
Currently, judges apply the law on a case-by-case basis when setting initial support awards and when considering modification applications. Because the current laws allow for consideration of special and extenuating circumstances, opponents of reform believe that the current system leads to equitable results. In addition, they fear that revision of the alimony laws would open the floodgates to unhappy payors seeking to relitigate existing divorce agreements and further stress an over-burdened court system, necessitating additional financial resources to be directed to the courts, something which the state can ill afford.
Opponents object to attempts by reformers to abolish permanent alimony and thereby potentially affect permanent alimony awards that were either agreed to by the parties as part of an overall settlement or awarded by a judge after hearing the special circumstances of a matter. They view such proposed reform as an attempt to retroactively change divorce agreements that took into consideration the division of other assets, such as homes, businesses and financial assets, at the time permanent alimony was initially awarded.
Opponents of reform point out that the proposed changes do not include provisions for reinstatement or modification of alimony once the payor spouse gets back on his or her financial feet and believe that the proposed changes would provide incentive for the payor spouse to become unemployed or underemployed. They are concerned that such changes would harm supported spouses and lead to more families on welfare, which the state cannot afford.
Lessons From Other States
Other states have undertaken alimony reform with mixed results. Largely as a result of a grassroots movement, on March 1, Massachusetts enacted a new alimony law. Under the new law, alimony is now awarded like child support, with guidelines for spousal support based on the length of the marriage and the income of the parties. The new law includes provisions for termination of support upon the retirement of the payor spouse or cohabitation by the supported spouse for a period of at least three months. Importantly, it allows for exceptions and judicial discretion. These changes provide predictability regarding the amount and duration of alimony to be paid or received, while preserving flexibility on the part of the court to consider special circumstances, such as chronic illness or advanced age, as well as tax considerations. It is anticipated that these changes will help matters settle out of court.
Unlike Massachusetts, a recent attempt to overhaul Florida’s alimony laws, which reform supporters feel are out of date, recently failed to pass the state senate. Florida law currently allows for permanent alimony awards which terminate only on the death of the payor or the remarriage of the supported spouse. The proposed bill, which was strongly opposed by the Florida Bar’s Family Law Section, would have capped the amount of alimony at a specified percentage of the payor’s monthly income and allowed for alimony to terminate upon the payor reaching the full age of retirement. Cohabitation, child support and other factors would also have been considered in determining an award. Further, long-term awards, which would have replaced permanent alimony, could have been awarded for good cause pursuant to the proposed changes. Despite the failure of the bill to pass, the battle is not over. It is anticipated that new alimony reform proposals will be made in the near future, perhaps as early as the 2013 session.
The Future for Reform in New Jersey
In New Jersey, Gov. Christie has indicated that he would not be opposed to alimony reform but that he would need specifics regarding the proposed changes before commenting definitively. Given that the bills currently under consideration by the New Jersey Legislature seek only the appointment of a commission to study the issue of alimony, it is clear that it will be a while before the specifics of proposed changes to New Jersey’s alimony laws can be considered by our legislators or presented to the governor. Until that time, the debate over alimony reform will continue. •