However, on June 26, 2014, a compromise was reached in the New Jersey Assembly and that compromise was also adopted by the State Senate on June 30, 2014. The compromised Bill is being presented to Governor Christie and it is believed that the Bill will be signed into law as submitted.
It is essential that those involved in settlement discussions with their spouse or who are already in matrimonial litigation familiarize themselves with the provisions of the Bill. Additionally, those individuals who have already been divorced and are paying or receiving alimony would benefit from a review of the alimony modification provisions.
The following is a summary of pertinent provisions of the Bill:
1. Although there is no schedule for the duration of alimony based on duration of the marriage, the new law will provide that in marriages or civil unions of less than twenty years in duration, the total duration of alimony shall not, except in exceptional circumstances, exceed the length of the marriage or civil union. This provision is not retroactive to cases already settled or adjudicated.
2. The terms “permanent alimony” or “indefinite alimony” are replaced with the term “open durational alimony” and applies to marriages or civil unions of more than twenty years in duration. This change in language itself will likely not have any effect on alimony determinations in cases involving marriages or civil unions in excess of twenty years.
3. In determining the type of alimony, the majority of the factors to be considered by the Court remain the same. However, there are several notable changes. In factor number four, which provided for the Court to consider the likelihood of the parties to maintain a reasonably comparable standard of living as existed during the marriage or civil union, the legislature has made it clear that “neither party has a greater entitlement to that standard of living than the other”. The Court would also be required to consider the support that had been paid during the litigation. Finally, the Legislature has made it clear that in evaluating alimony, all factors are to be considered and no factor is to be elevated in importance over any other factor unless the Court makes specific written findings in that regard.
4. There are three notable changes in the new Bill’s provisions regarding modification of alimony awards. If Governor Christie signs the Bill, alimony could now be subject to modification or termination upon the prospective or actual retirement of the obligor. This provision is aimed at resolving a problem that has been faced by alimony payors as they approach retirement age. Under existing law, the payor often faces a dilemma as to whether or not to retire, without knowing the effect of retirement on his/her alimony obligation. Under the Alimony Reform Bill, the payor can make an application to the Court in anticipation of retirement to determine whether alimony will be terminated or modified upon retirement. The Statute also establishes a “rebuttable presumption that alimony shall terminate” upon the payor attaining “full retirement age”. This means that when the payor reaches full retirement age (presently considered to be the age of 67), it is more than likely that alimony will be terminated, unless the recipient is able to demonstrate good cause for continuing alimony beyond that age. If the payor desires to retire prior to full retirement age, then an application can still be made. However, in those cases, the payor maintains the burden of demonstrating that the retirement is reasonable and made in good faith.
5. Also under the Bill provisions, alimony may also be modified upon “an involuntary reduction in income”. Under existing case law, Courts can only modify alimony if an alleged reduction of income is “permanent”. Under the reform Bill, the Court will be able to assess a temporary remedy in cases where the reduction of income is temporary. The Court could also schedule periodic reviews to assure fairness and equity to both parties.
6. Finally, the reform Bill provides for greater rights to modify alimony in cases involving cohabitation. The Bill sets forth various factors for the Court to consider. Significantly, the emphasis is no longer on a requirement that the alimony recipient live with his/her significant other on a full-time basis. Rather, the Court can consider “the frequency of contact” with the significant other. The Court may not find an absence of cohabitation solely on grounds that the couple does not live together on a full-time basis.
Although one of the purposes of the alimony reform movement was to simplify the divorce process, it appears that since there are no set schedules for alimony duration or amount, for those contemplating separation or divorce, it is essential that they consult with an experienced matrimonial attorney to gain an understanding as to how the new law (if signed by Governor Christie) effects their rights and obligations. Further, for those who are already receiving or paying alimony, it is important that the terms of the Settlement Agreement or the Court's Judgment be reviewed to determine the extent to which the new law's modification provisions will affect their rights and obligations.