New Jersey’s Alimony System
The New Jersey legislature has passed a major overhaul of the alimony system in the State. On Thursday, June 26th, 2014 the New Jersey Assembly passed by a vote of 75-0 (with four abstentions), A-845/971/1649, a measure that would drastically alter how alimony is determined in the future. Four days after the Assembly’s vote, on June 30th, the Senate passed the same bill by a vote of 32-2, thereby sending it to Governor Chris Christie to be signed into law. The prospective measure gives judges and practitioners in the state of New Jersey a set of factors and guidelines to follow in determining how long alimony can be awarded and when alimony payments can be stopped and/or terminated. The New Jersey legislature’s website 1 describes the bill as establishing “durational limits and enumerates certain factors concerning modification and termination of alimony”, and it establishes “open durational” alimony. The website NJ.com reports that the bill is the result of a compromise that has been in discussion for over two years.
The prospective law seeks to make sweeping changes to the current system for alimony payments in the future for dissolutions of marriages and civil unions, although it would not apply to divorce settlements or orders already in effect. If signed into law, the bill would provide comprehensive reforms to the current system including: a) judges would be able to end alimony payments if the recipient of those payments lives with another partner, even if they are unmarried, b) judges would be able to lower payments if the payer has been out of work for 90 days, c) the term “permanent alimony” would now be replaced with “open durational alimony” and d) for marriages that last less than 20 years, the length of alimony payments would not be able to exceed the length of the marriage unless a judge deems the circumstances “exceptional.” Among the other features of the bill is a measure that would allow the alimony payer to make an application to the Court as retirement age nears to determine if alimony payments would cease or modify upon the payer’s retirement. Currently, the issue of whether to retire weighs heavily on payers of alimony as there is no indication as to how retirement will affect future payments.
While these measures are not retroactive to cases already settled or adjudicated, they seek to provide reforms to an area of law that some feel are in major need of change. Assemblyman Charles Mainor stated, “We looked at the payers and we looked at the payees, and we realized that the current alimony laws are ancient and had to be brought up to 2014.” Mainor, one of the bill’s chief sponsors, also remarked that this was a compromise that took over two and a half years to reach, as he and his fellow sponsors worked closely with both special interest groups and the New Jersey Bar Association to craft the legislation 2. While a compromise was eventually reached, it was not all smooth sailing as Paris Eliades, President of the New Jersey State Bar Association, remarked that crafting the bill was akin to going through a divorce. Eliades, at the Senate Judiciary Committee hearing, explained: “We have discussed, compromised and negotiated over a two-year, lengthy period of time, and this bill is a product of those discussions… Like in any divorce, we ultimately achieve a resolution where not everyone has gotten what they wanted. 3”
Presently in in New Jersey, pursuant to N.J.S.A. 2A:34-23, there are several types of alimony, including permanent alimony, limited duration alimony, rehabilitative alimony and reimbursement alimony. The factors to be considered when awarding alimony are:
- The actual need and ability of the parties to pay;
- The duration of the marriage or civil union;
- The age, physical and emotional health of the parties;
- The standard of living established in the marriage or civil union and the likelihood that each party can maintain a reasonably comparable standard of living;
- The earning capacities, educational levels, vocational skills, and employability of the parties;
- The length of absence from the job market of the party seeking maintenance;
- The parental responsibilities for the children;
- The time and expense necessary to acquire sufficient education or training to enable the party seeking maintenance to find appropriate employment, the availability of the training and employment, and the opportunity for future acquisitions of capital assets and income;
- The history of the financial or non-financial contributions to the marriage or civil union by each party including contributions to the care and education of the children and interruption of personal careers or educational opportunities;
- The equitable distribution of property ordered and any payouts on equitable distribution, directly or indirectly, out of current income, to the extent this consideration is reasonable, just and fair;
- The income available to either party through investment of any assets held by that party;
- The tax treatment and consequences to both parties of any alimony award, including the designation of all or a portion of the payment as a non-taxable payment; and
- Any other factors which the court may deem relevant.