Considerations for Alimony Modification in the Post-Lepis Era
The court’s power to modify alimony and support orders at any time is specifically recognized by New Jersey Statute. (See, N.J.S.A. 2A:34-23). In order to achieve a change in alimony or child support you, need to show a “change in circumstance.”
But what does a “change in circumstance” look like and how do the courts decide if such a change has occurred?
In 1980, the New Jersey Supreme Court decided the issue in Lepis v. Lepis. This case is the guidepost for what constitutes a change in circumstance when it comes to support modification. The Lepis court identified seven factors which future courts should consider when determining whether there has been a change in circumstance. Those important factors are as follows:
an increase in the cost of living
an increase or decrease in the supporting spouses income
an illness, disability or infirmity arising after the original judgment
the dependent spouse’s loss of house or apartment
the dependent spouse’s cohabitation with another
subsequent employment by the dependent spouse
changes in federal income tax law
In order to be successful, the spouse seeking a modification needs to make two separate and distinct showings.
First, the party seeking a modification must show that there is been a change of circumstances to warrant a modification of the support provisions of the final judgment of divorce. If the movement is successful in demonstrating a change in circumstance then, and only then, will they will be given an opportunity to show how the modification is warranted given the change in circumstance. The burden of proof or burden of persuasion to convince the court that there has been a prima facie change of circumstance lies with the party seeking a modification. Someone has satisfied his or her prima facie burden when there is enough evidence before the court sufficient to prove the case unless there is substantial contradictory evidence.
Once a party has established a prima facie change of circumstance, the court will often, if not always, order discovery of an ex-spouse’s financial status. The party seeking a modification needs to demonstrate that the change in circumstances has substantially impaired his or her ability to support himself or herself. At a minimum, the court orders each party to submit updated case information statements. However, the courts often allow discovery by way of request to produce, interrogatory questions, subpoenas, and even depositions. After the discovery has been completed, the court will hold a plenary hearing to resolve any questions of material fact.
A court will not find a change in circumstance based on factors which are temporary or which are expected but have not yet occurred. There is no bright line rule to measure when a change in circumstance has taken place long enough to warrant a modification of the support obligation. However, economic circumstances of the present time, including much higher unemployment rates than are usual, should be considered by the court.
This can be very problematic for someone who has suddenly fallen on hard economic times or believes that a difficult economic reality is imminent. One of the most common factors that lead someone to seek a alimony modification is a loss of employment. Every case is different, however, absent a meaningful duration of unemployment, the courts will typically hold that a loss of employment is temporary in nature.
It should be noted that the above general rule applies only when there’s nothing in the property settlement agreement that is contradictory. Often times, parties will enter into non-modifiable alimony agreements. The clauses in the property settlement agreement which address non-modifiability of the alimony are commonly known as “anti-Lepis clauses.” A property settlement agreement may define what constitutes a change in circumstances for the modifiability of alimony. For example, if the parties acknowledge that the financially independent spouse’s income and employment is tenuous, the property settlement agreement can include terms and conditions for modification of alimony. A property settlement agreement could contain terms providing that if the financially independent spouse lost his or her job, then the alimony could be temporarily modified even though the loss of employment is temporary. If the alimony paying spouse owns a privately held business, the loss of a key client could be the triggering mechanism for and alimony review.
If any of these types of clauses are used in a property settlement agreement, it’s always a good idea for the property settlement agreement to specifically outline the financial documentation that will be exchanged by the parties before the alimony obligation is modified. Obviously, the alimony modification will depend upon the financial circumstances of the parties. It is usually desirable to require the parties to exchange tax returns, recent pay stubs, and an updated case information statement. If one or more of the parties owns a closely held business, further documentation would be required. In those situations, property settlement agreement may specify that the document exchange include personal and business tax returns and the underlying documents used to prepare those documents.
The above examples provide simply an introduction into the many ways to deal with alimony obligations in an uncertain economy. Experienced help is a quick phone call or email away. If you have any questions regarding how your finical situation may affect your support obligations, or have any other general questions regarding divorce, child support or spousal support, please contact us online today or call (856) 546-1350 for a confidential consultation with one of our skilled family court lawyers.