Party To Small Business Divorce Seeks Post-Judgment Modification

In Fiorenza v. Fiorenza, the Defendant appealed from the denial of a post-judgment Motion to modify his alimony obligation following a divorce including a small business. The Family Court judge initially ruled that alimony is not modifiable based upon anti-Lepis language in a negotiated Consent Order which set an amount below which the Defendant's alimony obligation could not be reduced. The parties in this case were married in 1986 and divorced in 2010. Three (3) children were born of the marriage. Only one child still remained at home at the time of the proceedings. During the marriage, the Defendant owned an MRI facility in addition to holding an interest in an accounting practice. The Defendant sold his interest in the MRI facility during the divorce because the business was failing. The marital settlement agreement (MSA) which was incorporated into the judgment of divorce directed that "the husband is self-employed and has average earnings of $250,000 per year" and the Plaintiff can reasonably earn "$25,000 per year." The parties agreed that in 2011 the Defendant would pay to the Plaintiff permanent alimony of $100,000 per year in monthly installments of $8,333. Within a few months the Defendant stopped paying support based upon his business suffering some financial hardships. The Plaintiff then petitioned the court to enforce the parties' agreement, resulting in Orders reducing the Defendant's six months' arrears and sending the parties to mediation. Mediation proved to be unsuccessful and the Defendant subsequently filed a Motion to reduce his support and the Plaintiff submitted a Cross-Motion to enforce litigant's rights. These Motions were resolved by the Consent Order that was at issue in the appeal. The exact provision at issue stated that "No matter defendant's annual gross income, at no time shall monthly support be lower than $5,000, except after the emancipation of [the parties' youngest child] when the child support component may be reduced . . . ." The Defendant then made $5,000 monthly payments to the Plaintiff for one year until he unilaterally reduced his payment to $2,000 and then the following month he paid nothing. The Plaintiff immediately moved to enforce the Consent Order to reinstate the support to $8,333, the amount negotiated in the MSA. The Defendant cross moved to reduce his alimony in accordance with Lepis v. Lepis, 83 N.J. 139 (1980) or Morris v. Morris, 263 N.J. Super 237 (App. Div. 1993). After hearing oral argument, the Family Court judge enforced the Consent Order holding the critical clause to operate as an anti-Lepis provision in accordance with the Morris decision. The judge noted that the Defendant did not dispute that both parties bargained for the agreement and each party got the expected benefit and burden of the contract. Although enforcing the Consent Order the judge ordered a plenary hearing to determine his ability to pay both alimony and arrears. After the hearing, the judge ordered the Defendant to pay $2,500 in alimony and child support with the difference between that sum and the required $8,333 under the agreement to accrue. Then the court ordered a nominal arrears payment of $100 per month. The Appellate Division affirmed the decision of the Family Court finding that the trial court was correct in holding that the parties had anticipated the decline in the Defendant's income when they negotiated the Consent Order and agreed that notwithstanding any such decline, his alimony obligation to the Plaintiff would never drop below $5,000 except upon the child's emancipation. Crespo v. Crespo, 395 N.J. Super. 190, 194 (App. Div. 2007). No explicit reference to Lepis was required. Savarese v. Corcoran, 311 N.J. Super. 240, 243 (Ch. Div. 1997). Being that the laws governing alimony have recently been changed, it is very important that you seek out the advice of an attorney to protect your rights an entitlements. If you think that it may be beneficial for you to petition the court for a post-judgment modification of your alimony obligation or for any other reason it is imperative that you seek out the advice of an experienced attorney before moving forward. For more information about alimony, divorce, post-judgment modification, child support, or other family law matters in New Jersey visit the DarlingFirm.com. This blog is for informational purposes and in no way is intended to replace the advice of an attorney.

Relief for Payors Suffering After High Net-Worth Divorce

In a recent post-judgment motion following a high net-worth divorce, a modification motion by payor resulted in a finding that the court must consider not only changes in the payor's income but also changes in the payee's income when hearing motions for modification. In Heard v. Dunbar The judge hearing the divorce did not include any findings regarding the terms of the parties' Property Settlement Agreement. Defendant earned $800,000 per year working at Goldman Sachs until 1997 when he resigned after accusations of fraudulent activity. The parties had saved $800,000 and defendant became a day trader working with their personal funds and increased the value of their investments to $8,000,000.00 by 2000, when the parties separated. In the next 2 years the value of the portfolio decreased to only $304. Defendant returned to the financial industry as the manager of a "start up" investment fund and earned only $15,000 in 2003 when the parties entered the Property Settlement Agreement (PSA). Plaintiff was employed as a psychologist and earned $52,000 per year in 2003. Although the defendant earned only $1250 per month, the PSA called for him to pay $1885 per month in child support. Although defendant later represented, in 2011, that the payment was based on the presumption he could return to his previously high earning levels, no information was set forth in the PSA regarding how this figure was arrived at other than to state it was in accordance with the "marital standard of living" but the standard of living during the marriage was not set forth in the agreement. The PSA also called for defendant to provide plaintiff $2,000,000 in assets as equitable distribution in lieu of alimony, pay up to $250,000 for the child's college tuition and obtain a $2,000,000 life insurance policy. Defendant ultimately developed a career in real estate and, by 2011, was earning $119,000 annually while plaintiff's income had increased to $115,000 per year. Plaintiff filed a Motion to Enforce the agreement and defendant filed a cross-motion to decrease his child support and college tuition obligations. An Essex County Family Court Judge denied defendant's motion finding no appreciable or permanent change in circumstances from 2003 to the present time, granted plaintiff's motion, failed to acknowledge plaintiff's substantial increase in income and made no findings regarding the denial of defendant's motion to reduce college payments and insurance. In its opinion, the New Jersey Appellate Court set forth the standards for modification as requiring consideration of the circumstances of both parties and that the reasons for all findings of fact be set forth clearly on the record. If you are seeking a modification of child support or alimony, you should consult an experienced family law attorney immediately in order to protect your rights. For more information on child support, custody, parenting time/visitation, adoption, dissolution of a civil union, marriage or domestic partnership, modifications, alimony, palimony or other family or juvenile law matters in New Jersey visit HeatherDarlingLawyer.com. This blog is for informational purposes only and in no way intended to replace the advice of an attorney regarding your specific matter.

Limited Duration Alimony Criteria Reaffirmed in NJ

The Court recently reaffirmed the principles behind an award of limited duration alimony. The wife worked in the husband’s medical practice as an office manager and administrator during the 9 year marriage. It was only toward the final years of the marriage that the parties began to enjoy affluence, after years of hard work to develop the business. During the marriage, the wife developed bipolar disorder and, at trial, obtained an employability expert to make the argument she was unable to work. The court considered that the wife did work during the marriage, even if it was limited to working in the husband’s office. The court further considered that, although the wife made claims of unemployability, the court was not convinced she was unable to work. The Appellate Court set forth the primary factors in consideration as the term of the marriage, the age of the supported spouse, and the short time during which the lavish lifestyle she wishes to continue existed during the marriage. In light of the factors set forth, the Court determined that limited duration alimony was appropriate, in spite of the husband’s substantial income at the time the marriage ended. If you are facing or considering a divorce, you should consult an experienced family law attorney in order to protect your rights. For more information on alimony/spousal support, divorce, dissolution of civil union or domestic partnership,child custody, child support or other family law matters in New Jersey visit HeatherDarlingLawyer.com. This blog is for informational purposes only and in no way intended to replace the advice of an attorney regarding your specific matter.