Overbay v. Overbay
Seven years ago the New Jersey Supreme Court used a 7.7% rate of return to impute unearned income to a party’s assets for the purpose of determining their ability to pay alimony – Miller v. Miller 160 NJ 408 (1998).
Although the Court in Miller used then current market indexes to determine a fair and appropriate rate of return, there have been Judges and lawyers who have interpreted the Miller decision to require a 7.7% rate.
In Overbay v. Overbay (decided 3/18/2005) the Appellate Division unequivocally held that the Miller Rate of 7.7% was not intended by the Supreme Court to be a universal rule replicated in every case. The Appellate Division, instead, directs the Trial Courts to review each case in the context of the parties existing investment strategies and the current market conditions.