Opinion
DOCKET NO. A-5079-13T3
10-29-2015
PENELOPE PERREAULT, Plaintiff-Respondent, v. ROBERT PERREAULT, Defendant-Appellant.
David M. Lipshutz, attorney for appellant. Trace Jenkins, attorneys for respondent (Thomas J. Jenkins and AllynMarie Smedley, on the brief).
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION Before Judges Alvarez and Simonelli. On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Camden County, Docket No. FM-04-1579-94. David M. Lipshutz, attorney for appellant. Trace Jenkins, attorneys for respondent (Thomas J. Jenkins and AllynMarie Smedley, on the brief). PER CURIAM
In this post-judgment matrimonial matter, defendant Robert Perreault appeals from the May 27, 2104 Family Part order, which denied his motion to terminate his alimony obligation based on changed circumstances, but granted his alternative request to modify alimony. We affirm in part, reverse in part, and remand for further proceedings.
I.
Defendant and plaintiff Penelope Perreault were married in 1974, and divorced in 1996. The April 29, 1996 Final Judgment of Divorce (FJOD) required defendant to pay pendente lite alimony in the amount of $300 per week pending a plenary hearing. The FJOD also awarded the parties a fifty-percent share of the marital portion of defendant's federal pension. Following a hearing, in an August 7, 1996 order, the court ordered defendant to pay permanent alimony in the amount of $500 per week, effective July 19, 1996. Neither the FJOD, nor the August 7, 1996 order provided that alimony would be of limited duration or would terminate upon defendant's retirement.
At the time of the divorce, defendant was employed by the Veterans Administration Hospital in Atlanta, Georgia, earning approximately $118,000 per year. He retired from that job in 2004, at age fifty-five, and began receiving his federal pension. He continued working for other companies thereafter, and in 2007, he and his current wife began a consulting business. He retired in November 2013, at age sixty-five. He chose not to apply for the Social Security benefits to which he was entitled, which he estimated to be $1000 per month subject to a reduction of approximately $400 per month because of his pension.
Defendant submitted a purported letter from his doctor, on which he relied to argue he was forced to retire for medical reasons. This letter constitutes inadmissible hearsay. N.J.R.E. 802; see also R. 1:6-6 (requiring facts not appearing of record or not judicially noticeable to be supported by affidavit "made on personal knowledge setting forth only those facts which are admissible in evidence to which the affiant is competent to testify").
Defendant's current wife also receives a federal pension and also chose not to apply for Social Security benefits.
On April 7, 2014, defendant filed a motion to terminate alimony based on changed circumstances or, alternatively, reduce his alimony obligation. His Case Information Statement (CIS) showed he had a 2013 gross income of $96,984 derived solely from his pension. He certified that from that amount, $28,239.48 was paid to plaintiff for her fifty-percent equitable distribution share, leaving him with $68,744.52. He argued that only $25,000 of that remaining amount could be considered for alimony purposes, and this amount was insufficient to justify an alimony award. Defendant's CIS also showed he had no debt, $9891 in monthly expenses, and $823,000 in assets, which included an IRA in the amount of $109,000 in his name only and $723,000 in assets owned jointly with his current wife, including $90,000 in their business's bank account.
Plaintiff filed a cross-motion for enforcement and counsel fees. Her CIS showed she had $27,012 in 2013 net income, consisting of $20,964 from her federal pension and $6048 from Social Security benefits. Her CIS also showed she had $7965 in assets, $20,367 in debts, and $7220 in monthly expenses, including $1856 in expenses she paid for the parties' two adult children. Plaintiff argued she was unable to maintain the marital standard of living as set forth on defendant's last filed CIS before the divorce, whereas defendant was living significantly above that standard.
The judge reviewed the parties' respective CISs in detail. After eliminating expenses for the parties' adult children and making other deductions, the judge reduced plaintiff's monthly expenses to $4100 per month. In reviewing the money plaintiff had available for her support, the judge excluded her fifty-percent share of defendant's pension and her Social Security benefits, and determined she had an $18,500 annual shortfall. Although plaintiff claimed the shortfall was actually $25,000, the judge justified the lower shortfall figure by finding that the adult child living with plaintiff should contribute to the household.
The judge found that defendant's income had decreased, but also found he had accumulated substantial post-judgment assets separate from his current wife from which he could pay alimony. The judge determined defendant had $832,000 in assets and reduced this by more than one-half, awarding the entire $90,000 in the business account to defendant's current wife. The judge was also aware that the non-marital portion of defendant's pension was $40,505.04, not $25,000.
The judge also reduced defendant's monthly expenses, finding that, among other inflated expenses, the $7200 per year, or $600 per month, defendant claimed for "gifts" was "off the charts." The judge noted that defendant's future Social Security and his current wife's income would assist him in paying his expenses, thus increasing his ability to pay alimony.
The judge concluded that without alimony, plaintiff would be in "dire straits," while defendant's life would not be "uncomfortable" by paying her $375 per week. The judge emphasized that the amount awarded did not include support for the adult children. The judge denied plaintiff's request for counsel fees. This appeal followed.
II.
On appeal, defendant contends that the $25,000 non-marital portion of his pension does not justify an alimony award, and except for a small amount of imputed income from his assets, the judge erred in including his assets in determining his ability to pay alimony.
"Courts have the equitable power to establish alimony and support orders in connection with a pending matrimonial action, or after a judgment of divorce or maintenance, and to revise such orders as circumstances may require." Crews v. Crews, 164 N.J. 11, 24 (2000) (citing Lepis v. Lepis, 83 N.J. 139, 145 (1980)). "As a result of this judicial authority, alimony and support orders define only the present obligations of the former spouses. Those duties are always subject to review and modification on a showing of 'changed circumstances.'" Lepis, supra, 83 N.J. at 146 (citations omitted). It "reflects 'the important policy of recognizing that marriage is an adaptive economic and social partnership.'" Glass v. Glass, 366 N.J. Super. 357, 369 (App. Div.) (quoting Cox v. Cox, 335 N.J. Super. 465, 479 (App. Div. 2000)), certif. denied, 180 N.J. 354 (2004). "Imposing an obligation by judicial mandate or agreeing to support 'permanently' reflects the judicial and, where agreed upon, personal recognition of the marital relationship and partnership." Id. at 370. Even if the parties enter an agreement about alimony, a former spouse may seek judicial review or modification of the spousal support based upon a showing of changed circumstances. Ibid. (citing Miller v. Miller, 160 N.J. 408, 419 (1999)).
A party seeking a modification of alimony must make a prima facie showing of changed circumstances that have substantially impaired his or her ability to support himself or herself. Lepis, supra, 83 N.J. at 157. There are several factors that may warrant a modification of alimony:
(1) an increase in the cost of living;
(2) increase or decrease in the supporting spouse's income;
(3) illness, disability or infirmity arising after the original judgment;
(4) the dependent spouse's loss of a house or apartment;
(5) the dependent spouse's cohabitation with another;
(6) subsequent employment by the dependent spouse; and
(7) changes in federal income tax law.
[Id. at 151 (citations omitted).]
A trial judge has broad discretion in reviewing an application to modify alimony. Storey v. Storey, 373 N.J. Super. 464, 470 (App. Div. 2004) (citing N.J.S.A. 2A:34-23). "[E]very alimony application 'rests upon its own particular footing and [we] must give due recognition to the wide discretion which our law rightly affords to the trial judges who deal with these matters." Rolnick v. Rolnick, 262 N.J. Super. 343, 359 (App. Div. 1993) (quoting Martindell v. Martindell, 21 N.J. 341, 355 (1956)). For us to vacate a trial court's decision to modify alimony,
[we] must conclude that the trial court clearly abused its discretion, failed to consider all of the controlling legal principles, or [we] must otherwise be well satisfied that the finding[s] [were] mistaken, or that the determination could not reasonably have been reached on sufficient credible evidence present in the record after consideration of the proofs as a whole."Consequently, when [we] conclude[] there is satisfactory evidentiary support for the trial court's findings, '[our] task is complete and [we] should not disturb the result[.]'" Elrom v. Elrom, 439 N.J. Super. 424, 433 (App. Div. 2015) (quoting Beck v. Beck, 86 N.J. 480, 496 (1981)). "'Deference is appropriately accorded to factfinding; however, the trial judge's legal conclusions, and the application of those conclusions to the facts, are subject to our plenary review.'" Ibid. (quoting Reese v. Weis, 430 N.J. Super. 552, 568 (App. Div. 2013). "Finally, legal conclusions are always reviewed de novo." Id. at 433-34 (citing Manalapan Realty, L.P. v. Twp. Comm. of Manalapan, 140 N.J. 366, 378 (1995)). With these standards in mind, we continue our review.
[Id. at 360 (citations and internal quotation marks omitted).]
"When a share of a retirement benefit is treated as an asset for purposes of equitable distribution, the trial court shall not consider income generated thereafter by that share for purposes of determining alimony." Innes v. Innes, 117 N.J. 496, 505 (1990) (emphasis added) (internal quotation marks omitted). "Conversely, the rule does not bar counting as income for determining alimony that portion of the former spouse's pension attributable to post-divorce employment, and therefore not subject to division as marital property at time of divorce." Steneken v. Steneken, 367 N.J. Super. 427, 437-38 (App. Div. 2004) (citing Innes, supra,, 117 N.J. at 504-06; Staver v. Staver, 217 N.J. Super. 541, 545 (Ch. Div. 1987)), aff'd in part and modified in part, 183 N.J. 290 (2005). "In other words, a supporting spouse's pension may be considered for purposes of alimony to the extent that post-divorce earnings enhance its value." Id. at 438; see also Claffey v. Claffey, 360 N.J. Super. 240, 261 (App. Div. 2003) (holding that "income from pension benefits earned after the filing of the complaint for divorce may be considered for purposes of alimony modification").
Here, the parties were each awarded fifty percent of the marital portion of defendant's pension. Plaintiff received her fifty-percent share, $28,239.48, and defendant was entitled to that same amount. Thus, the marital portion of defendant's pension was $56,478.96. Subtracting that amount from defendant's total pension of $96,984 left a non-marital portion of $40,505.04, which could be considered in determining his present alimony obligation. Accordingly, we discern no abuse of discretion in the judge using the $40,505.04 non-marital portion of defendant's pension in determining his alimony obligation.
Plaintiff does not argue that $40,505.04 was sufficient to justify the $375 per week alimony amount, nor does she argue that defendant's future Social Security benefits should be considered in determining his ability to pay. Thus, the question is whether, in addition to the $40,505.04, defendant had other sources of income that justified the modified alimony amount.
We reject defendant's contention that the judge erred in considering his future Social Security income and current wife's income in determining his ability to pay. The judge did not rely on these two factors, but merely considered them to the extent they increased defendant's ability to pay his monthly expenses. --------
A supporting spouse's assets may be considered in calculating an alimony award, and the liquidity of the asset is not relevant. Miller, supra, 160 N.J. at 422. However, it is the income generated by the asset, not the total value of the asset itself, that is relevant for purposes of determining the supporting spouse's ability to pay. Ibid. In this case, the record does not show what income was generated by the assets attributed solely to defendant. Accordingly, we reverse that part of the judge's ruling relating to defendant's assets and remand for further proceedings.
IV.
We have considered defendant's remaining contentions, that plaintiff had substantially more income than she claimed, and that his alimony payments were "just a disguise for endless child support payments," in light of the record and applicable legal principles and conclude they are without sufficient merit to warrant discussion in an opinion. R. 2:11-3(e)(1)(E).
Affirmed in part, reversed in part, and remanded for further proceedings consistent with this opinion. On remand, the court shall determine the amount of income generated by the assets attributable to defendant and whether that income, along with the non-marital portion of defendant's pension, justifies an alimony award and, if so, in what amount. We do not retain jurisdiction.
I hereby certify that the foregoing is a true copy of the original on file in my office.
CLERK OF THE APPELLATE DIVISION