New Jersey Lawyer & Attorney : Stark & Stark Law Firm : New Jersey Law Blog

In determining alimony, we are compelled to take into consideration the 13 factors set forth in our statute. Of utmost importance is the actual need of one spouse and ability of the other spouse to pay, along with the duration of the marriage and the standard of living established during the marriage.

In a recent case (Dudas v. Dudas, decided on April 11, 2011), the Defendant/Husband earned between $40,000 and $59,000, towards the end of the marriage. A Complaint for Divorce was filed in 2008, and the case was tried in 2011. Over those years, the Husband’s income increased wherein he earned $64,000 in 2009, $76,000 in 2010 and $68,000 in 2011.

The Defendant argued that his post-Complaint income should not be considered in any alimony calculus and that only the income he earned up to the date of the Complaint should be considered, since the parties’ standard of living was based on his pre-Complaint income.

While the standard of living established during the marriage is a predominant consideration, this factor does not stand alone. The Court held that the actual need and ability of a party to pay directs an analysis of the parties’ present needs and ability to pay, not the past. One of the other factors is the earning capacities of the parties which is also a current consideration.
 

The Dudas Court also considered two additional factors under the catch-all factor of “any other factors which a court may deem relevant.”  They are:

1. the marginal cost estimation; and
2. momentum of the marriage

The marginal cost estimation has to do with the fact that a couple living together is less expensive than a couple living separately in two households. Further, once each party establishes their separate residence, each party’s new budget is not 50% of the marital budget, it is generally more, and may not be substantially less than the two person household budget. In many divorce cases, when the parties separate, there is insufficient money available for either party to maintain the standard of living enjoyed during the marriage.
 

In the Dudas case, the Court felt it was fair to bring both parties reasonably closer to the marital standard of living, which could only happen by looking to the husband’s increased available funds after the Complaint date.
 

Momentum of the marriage recognizes the fact that one’s occupational efforts may take years to pay off. A person’s earning level may start out slow, but through experience, education and perseverance, it may increase dramatically the longer a person works in that particular field.
 

Therefore if a party focuses on his career throughout the course of a marriage, while the other party, as in the Dudas case, maintained the home, cared for the children and provided support and encouragement for the husband in his professional endeavors, then a post-Complaint rise in income will be considered in determining alimony.

Maria Imbalzano is the Co-Chair of Stark & Stark’s Divorce Group in the Lawrenceville, New Jersey office. For questions, please contact Ms. Imbalzano: mimbalzano@stark-stark.com.

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The obligation to pay alimony to one’s former spouse is a long-standing tenet of New Jersey statutory and decisional law. From time to time, various efforts have been made to reform and, in some cases, eliminate alimony which have proven unsuccessful. A new challenge has been mounted by New Jersey Alimony Reform, an organization founded by Thomas Luesek, a biology professor at Rutgers University, who was ordered by a Union County Court to pay permanent (i.e. indefinite duration) alimony to his former wife who he claims is capable of self support and does not need alimony. 

Mr. Luesek’s organization seeks no less than the elimination of permanent alimony, a position supported by Assemblyman Sean Kean (R-Monmouth) who has introduced a bill to set up a blue ribbon panel to examine such changes and thereby “bring New Jersey into the 21st century”.

Such efforts will provoke discussion, of which this article is an example, but will likely bear little fruit. Alimony in New Jersey is based upon a myriad of statutory factors which the Court can utilize, balance or deem inapplicable in the circumstances of the case. These factors include need and ability to pay, duration of the marriage, marital standard of living, career interruption and other factors which give discretion to the Judge while imposing a set of guidelines for the Court’s instruction and application as  circumstances deem “fit, reasonable and just”  under the governing statute. 

Contrary to popular assumption, Judges are required by law to utilize these factors and cite them in their decisions,  as opposed to employing their personal  sense of what is or isn’t “fair”.  Coupled with the statutory establishment of multiple forms of alimony such as Limited Duration, Rehabilitative and Reimbursement Alimony, it is, in my, wrong to contend that the elimination of “permanent” alimony serves a legitimate legal or societal goal. This is not to say that every alimony case is decided in a manner acceptable to both parties; however, in my over 30 years of practicing matrimonial law throughout New Jersey, the overwhelming number of alimony awards (or denials) have been appropriate to the circumstances of the case. There also exists an enormous body of reported decisions which are legally precedential with respect to alimony and its variations, as a result of which New Jersey judges and lawyers are very well-informed.

I would be the first to add than an award of alimony is not the answer in every case. In fact, it may be deemed totally unwarranted as I, and other matrimonial attorneys, have learned through courtroom experience. Moreover, “permanent” (indefinite duration) alimony is always subject to modification based upon a substantial change in circumstances unless the parties specifically contract otherwise. Thus, the elimination of this type of alimony unfairly tilts the scales in favor of alimony payers and against alimony payees.

There are an increasing number of legal authors who propose a different look at alimony via the establishment of “alimony guidelines” which would determine the amount and duration of alimony awards on a uniform basis throughout all of New Jersey’s counties. Such guidelines would be rebuttable; that is, they could be demonstrated to be inapplicable in a particular case.

This dialogue should continue as uniformity of alimony awards is a legitimate topic.  In contrast, arguments favoring the elimination of one type of alimony are not so framed and, in my opinion, run counter to New Jersey’s distinguished legal history in this important area. 

John Eory is the Co-Chair of Stark & Stark’s Divorce Group in the Lawrenceville, New Jersey office. For questions, please contact Mr. Eory: jeory@stark-stark.com.

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Internal Revenue Code Section 152 defines a dependent for tax exemption purposes. If parents are divorced or separated with a written Separation Agreement, or live apart during the last six months of the calendar year, and if a child or children are in the custody of one of the parents for more than one-half of the calendar year, that parent may take the dependency exemption for each of those children.

In many cases, parties who are divorcing reach an agreement as to who may take the dependency exemption for their children in any given year. Sometimes they split the dependency exemptions between them if there are two or more children. For any divorce or agreement entered into from 2009 onward, if the custodial parent (parent having the children for the greater portion of taxable year) agrees to give the other parent an exemption in any given year, the custodial parent must sign a written declaration that the custodial parent will not claim such child as a dependent for said taxable year and the non-custodial parent must attach that declaration to his/her tax return.  Prior to December 31, 2008, the non-custodial parent only had to attach the pages from his/her divorce decree or Separation Agreement to his/her tax return.

The form required now is IRS Form 8332 entitled “Release/Revocation of Release of Claim to Exemption for Child by Custodial Parent.”  Said form may cover the exemption for more than one year.

Maria Imbalzano is the Co-Chair of Stark & Stark’s Divorce Group in the Lawrenceville, New Jersey office. For questions, please contact Ms. Imbalzano: mimbalzano@stark-stark.com.

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In a recent unpublished trial court decision, a Trial Judge granted a motion for summary judgment requiring a man to reimburse a woman for the non-refundable portions of deposits spent on wedding vendors when the defendant broke off the engagement.

In this particular case, the Defendant proposed to the Plaintiff in July of 2003, and the couple began planning a wedding schedule for September 2004. The Plaintiff entered into contracts with and paid the deposits for several wedding vendors, including the limousine, wedding gown, reception venue, photographer, entertainment, etc.

However, in September of 2003, the Defendant broke of f the engagement. While the Plaintiff was able to recoup a portion of the deposits she paid to the various vendors, she was unable to obtain the full value of all of her deposits. In total, the Plaintiff alleges that she lost a total of approximately $20,500 in non-refundable deposits as a result of the broken engagement.

Thereafter, the Plaintiff and Defendant entered into a written and notarized Agreement wherein the Defendant agreed to reimburse the Plaintiff for the sum of $15,000 toward the amount of the non-refundable deposits within two years of the date of that Agreement. Thereafter, the Plaintiff drafted an Amended Agreement adding another $5,500 to the sum that was to be repaid by the Defendant. However, the Defendant did not sign this Amended Agreement. 

When the Defendant failed to make any payments toward the non-refundable portion of the deposits for the wedding vendors, the Plaintiff filed a Motion for Summary Judgment, arguing that there was no issue of material fact that the Defendant owed her a sum of $20,500. The Defendant, of course, opposed this motion, arguing that there existed genuine issues of material facts warranting a Trial insofar as he was forced to sign the original Agreement wherein he agreed to repay the sum of $15,000, the Plaintiff indicated that she and her family would be paying for the entire wedding, and that the additional payments of $5,500 were gifts and not loans. 

The Trial Court in granted the Plaintiff's Motion for Summary Judgment with regard to the sum of $15,000 which was the amount of the original written agreement, finding that the Defendant failed to present any evidence that he was forced to sign that agreement. The Trial Court also stated that the Defendant's argument that the plaintiff and her family were to be responsible for the cost of the wedding created no genuine issue of material fact, insofar as such discussions, had they occurred, would have pre-dated the break off of the engagement. Thus, the Court held that the Defendant was responsible for repaying the sum of $15,000 toward the non-refundable portion of the deposits for the wedding vendors.

 However, the Trial Judge denied the Plaintiff's motion for Summary Judgment for the additional sum of $5,500, insofar as the Amended Agreement was never signed. The denial of the Motion for Summary Judgment, however, does not mean that the Defendant was not responsible for repaying this sum.  Rather, the denial of the Motion for Summary Judgment for the additional sum simply means that there was a genuine issue of fact as to whether or not the Defendant ever agreed to repay this sum requiring a additional discovery, and perhaps, a Trial.

In short, in granting the Motion for Summary Judgment for the amount of $15,000, the Trial Court relied heavily on the fact that there was a written agreement which was signed by both parties and notarized requiring the Defendant to reimburse the Plaintiff that sum. Therefore, it is advisable to consult with an attorney before entering into any written agreement with another party, as it may very well be upheld by a Court. 

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In New Jersey, both parents are responsible for the support of their children, including contributions toward college education. Many times, parents begin saving for college education while their children are young by investing in 529 College Savings Plans or Custodial Accounts. 
 

It is important to note the differences between these two types of accounts since it may affect the vehicle you chose if you are getting divorced.
 

Custodial accounts are accounts established at a financial institution for the benefit of a minor child. Generally, one of the parents is named as the custodian for the benefit of the child under the Uniform Transfer to Minors Act (previously the Uniform Gifts to Minors Act). These accounts belong to the child, not the parent. By establishing this type of account, the parent(s) made an irrevocable gift to the child. While the parent, as custodian, may make the decision as to how the money will be invested and spent (until the child is 21), the money must nevertheless be spent for the child or turned over to the child at age 21.
 

It must also be noted that when using funds in a custodial account, that payment is in addition to, not in substitution for, any obligation of a person to support that minor. It is well settled law in New Jersey that a child’s assets may not be used to fulfill a parent’s support obligation.
 

A 529 Account is a college savings plan which has tax advantages authorized under IRC 
Section 529.  These plans allow an investor to save money in an account in which the earnings (i.e., interest, dividends) will grow tax free and, when used for qualified higher education expenses, may be withdrawn tax free.
 

Anyone can be named as a beneficiary regardless of their relationship to the owner, and anyone can contribute to the account.  Only one account owner can be named on the account. 
 

Since this type of account is owned generally by a parent (and not the child), this asset must be dealt with in any Property Settlement Agreement during a divorce. Since the account is only in one party’s name, the best way to deal with it is to split it equally between the parents to assure that each party has control or ownership of an equal amount.  Since divorce agreements many times include provisions for the allocation of college education expenses when they arise, each party can then plan for their own contribution in the future by continuing to invest in their own 529 plan or at least continuing to hold the asset.
 

It should be noted that an owner of a 529 account can make unqualified withdrawals (withdrawals for any reason) as long as they pay the tax and penalties associated with the withdrawal. Therefore, it is not preferable to keep the account in one party’s name after divorce with just a promise that he/she will use the account for your child’s college education expenses. 
 

Further, if only one party holds the asset and there were no specific terms in the Agreement relating to this account, the owner/parent may argue that these funds will go only toward his/her share of the obligation for college education, and the other parent will receive no credit.
 

It is best to be very explicit in your Property Settlement Agreement with regard to funds saved and intended for college.

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In a case of first impression, a New Jersey woman can be prosecuted for identity theft for allegedly creating a fake Facebook profile for her ex-boyfriend, and posting inflammatory comments about him online, a Judge has ruled.

DT (full name redacted) is accused of creating the fake profile of her ex-boyfriend, a Northern New Jersey narcotics detective, where she allegedly posted comments about him to the effect that he had herpes, frequented prostitutes, was “high” all the time, as well as allegedly confessing, “I’m a sick piece of scum with a gun,” while posing as him on the fake profile.

This case could have wide ramifications for cyberspeech in New Jersey and other states.  At issue is a New Jersey statute which makes it illegal to impersonate someone “...for the purpose of obtaining a benefit for himself or another, or to injure or defraud another.”  DT’s attorney attempted to have the charges dismissed on the grounds that the law makes no mention of “electronic communications”.  The Judge disagreed.

The ruling should give considerable pause to persons contemplating similar actions, since they will now be so doing at their own risk as the law continues to develop in this area.

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A Connecticut Judge has ordered a soon-to-be ex-husband and ex-wife to exchange their Facebook and dating website passwords in connection with their pending divorce.

According to the husband’s divorce attorney, his client saw incriminating messages on the computer he shares with his wife at home which made him suspect there would be more evidence in her social networking accounts, including how she feels about her children and her ability to take care of them, which would be relevant in the pending divorce case. During a deposition, the husband’s attorney asked the wife for her Facebook, E-Harmony and Match.com passwords. After initially refusing, she was instructed by her lawyer to disclose them [note: questionable legal advice]. It then appears that the wife immediately texted her friend and asked the person to change the passwords and delete some messages. Upon learning of this, the husband’s attorney obtained an injunction that the wife not delete any material with the Court further ordering the attorneys to exchange passwords for both spouses so the attorneys could conduct discovery.

On its face, the ruling violates Facebook’s s requirement that users not turn over their passwords to anyone. However, being judicially ordered to do so in the above circumstances and despite the fact that the ruling is highly privacy-invasive, it is certainly not the last word on this subject as the law and technology will continue to interface and evolve.

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As another year is winding down, it is important to consider whether or not you should hold off with the entry of your Final Judgment of Divorce until calendar year 2012. I know that many of you are reading this and thinking that another day married to your soon-to-be former spouse is one day too long to handle – however, there could be significant tax benefits to filing jointly one last time.

First, it is important to note that the Internal Revenue Service does not permit you to file under a “married” status unless you were legally married on the last day of the previous calendar year.
However, your case does not have to stall and negotiations to resolve your matter can continue, as you are permitted to have an executed Marital Settlement Agreement prior to the end of the calendar year.  If the end of the year is approaching and you have an executed Agreement, it is common to petition the Court to adjourn the Final Judgment of Divorce hearing. While the Court has no obligation to grant your adjournment request to the next calendar year, judges often grant such requests if there is a clear financial benefit to the parties.

Strategic decisions to hold off the Final Judgment of Divorce hearing are often agreed upon between attorneys in scenarios in which one client would be adversely impacted by a forced single tax filing.  One such scenario would be the case in which marital assets were liquidated during the litigation and tax consequences exist. (i.e. capital gains taxes, early withdrawal penalties/taxes of retirement accounts, etc.)  As many of the redeemed funds were often acquired during the marriage, the parties may minimize the tax burden (lower effective tax rate) by filing jointly and avoid the need to offset the credits through equitable distribution.

I have also experienced scenarios in which the parties have made the decision to hold off a Final Judgment of Divorce to file jointly despite having an executed Agreement to maximize the amount of financial aid for their children.

Please note that before any decisions are made regarding the benefits or possible pitfalls with filing designations during your divorce matter, it is essential that you consult with an experienced divorce attorney as well as a licensed Certified Public Accountant to review the various tax implications of your decision.

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On October 25, 2011, the Appellate Division of the New Jersey Superior Court decided that the case of B. v. B. (names redacted for privacy) and recognized the significant decrease in real estate values in implementing the parties’ divorce settlement.

The current economic downturn had not been contemplated in the parties’ Marital Settlement Agreement which was entered into in 2007.  When one party sought to enforce the Agreement based upon 2007 values, the trial court agreed.  The Appellate Division, however, reversed that ruling and concluded that a reasonable construction of the Agreement, coupled with principles of fairness and equity, required a different result. The Court stated that although the parties’ Agreement contained no reference of the possibility of reduced fair market values for their three parcels of real estate, the Court has the inherent authority to insert such a provision even though either party had anticipated it or it had been overlooked. 

This is an important development since the Court specifically acknowledged that principles of fairness compelling an examination of the current real estate market, as opposed to that which existed in 2007.  In these troubling economic times it is heartening that the Court recognized that matrimonial settlements, unlike commercial contracts, are a special breed and subject to interpretation and on occasion, reconstruction, based on principles of fairness and equity.

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There is no such thing as a right to equitable distribution of property during the dissolution of a domestic partnership. This right only accrues to individuals who have entered into marriage or a civil union. However, as dissolution of domestic partnerships occur in the Chancery Court, equitable principles are applied and joint property or property to which both parties contributed during the partnership, may be subject to partition, i.e., division. 

This issue was upheld on appeal in June 2008, wherein The Honorable John Tomasello, J.S.C. in Gloucester County, New Jersey awarded the division of a summer home the domestic partners had shared. The Order specified that interest in a house constituted the division of assets based upon equitable principles, and was not equitable distribution of property. 

If the partners in the foregoing matter had converted their partnership to a civil union upon enactment of same in New Jersey, equitable distribution of property could have been properly directed as this is one of the many rights and privileges from which civil union partners in New Jersey benefit. 

If you have questions regarding equitable distribution in domestic partnerships in New Jersey, or Pennsylvania, please feel free to contact me or schedule an appointment to meet with me in my firm's Lawrenceville, New Jersey or Newtown, Pennsylvania offices. 

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