On appeal from Superior Court of New Jersey, Chancery Division, Family Part, Hunterdon County, Docket No. FM-10-223-96.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Before Judges Grall and Chambers.
Plaintiff Denise L. Evans and defendant Jeffrey E. Steffens were divorced in 1997. The final judgment incorporates the parties' property settlement agreement (PSA). Plaintiff appeals from a provision of a post-judgment order that reduces child support in accordance with the terms of the PSA. Because the PSA does not address all of the changed circumstances that warrant modification of child support in this case, we reverse and remand for further proceedings. Lepis v. Lepis, 83 N.J. 139, 153, 157-59 (1980). Plaintiff also appeals from a second provision of the same order, which offsets amounts owed by defendant for health and life insurance against his overpayments of child support. Plaintiff contends that the offset is the equivalent of a retroactive modification of child support prohibited by N.J.S.A. 2A:17-56.23a. We disagree and affirm that portion of the order.
The parties married in 1991. There were two children born of their marriage; the first was born in 1992 and the second was born in 1994. The parties separated in 1996 and divorced in November 1997. Defendant's earnings at the time of the divorce are not in dispute on appeal. According to defendant, he was earning approximately $1,500,000 per year in 1997. Although plaintiff asserted that defendant was earning less at the time of her motion, on appeal she accepts defendant's figure, $1,500,000.
The PSA provides for defendant to pay child support as follows:
Effective with the date of the signing of this Agreement and continuing thereafter, Husband shall pay directly to wife the sum of $50,000 per annum ($4,166.66 monthly) as and for child support for the benefit of the parties two children. The aforesaid payments shall be made in monthly installments (on the first day of each month) until the older [child's] graduation from high school (anticipated to occur in June 2010). Immediately thereafter, husband's child support obligation shall drop to $30,000.00 per annum ($2,500.00 monthly) until [the younger child's] graduation from high school (anticipated to occur in June 2012). The aforesaid child support payment shall be made by husband in monthly installments payable on the first day of each month. Thereafter, husband's direct child support obligation shall cease.
In addition to cash support in the amount of $50,000, the PSA required defendant to pay the following: alimony in the amount of $50,000 for a term set to expire on May 10, 2009; the balance of the mortgage on the marital residence, the home in which plaintiff and the children were to reside (as part of plaintiff's share of equitable distribution); the loan on the lot adjacent to the marital residence (as part of plaintiff's share of equitable distribution); the real estate taxes on the properties for a term of five years (as part of plaintiff's share of equitable distribution); contributions to a trust fund for the education of the children; the cost of the children's health insurance; all medical expenses for the children; premiums for a $400,000 policy of insurance on his life owned by plaintiff; and the cost of funding an irrevocable life insurance trust in the amount of $800,000.
Shortly after the divorce, the family suffered an unexpected and tragic loss. In January 1998, their eldest child died of a rare disease.
Following the child's death, defendant did not seek a reduction in child support. According to plaintiff, he chose not to seek modification and agreed to continue to pay $50,000.00 for "the maintenance and benefit" of their youngest child. According to defendant, he continued to pay the full child support amount because he "wanted to give plaintiff the opportunity to grieve before revisiting the issue" and because she was paying the cost of health and life insurance. The PSA permits written modification of the agreement, and there is no evidence that the agreement was so modified.
After January 1998, defendant continued to pay $50,000 per year, the support due for two children under the PSA. Although defendant reduced the support payment for November 2006, on plaintiff's objection, he subsequently paid the full amount due for that month and the months thereafter. In addition, defendant paid the full cost of their youngest child's private school education, without resorting to funds in the educational trust or seeking any contribution from plaintiff, and professed his intention to continue paying that expense. He also paid for the child's summer camp and claimed he would do so in the future. Although defendant did not memorialize his agreement to pay these additional expenses in any written document, plaintiff did not dispute the fact that defendant had made the payments.
In June 2007, plaintiff filed a post-judgment motion seeking an order compelling defendant to continue child support payments in the amount of $4166.66 per month, $50,000 per year. Plaintiff contended that she relied upon defendant's agreement to provide child support in that amount in order to give their youngest child the lifestyle enjoyed during the marriage. She also noted, without quantifying the difference, that the carrying costs on her home and her living expenses had increased since the divorce. Plaintiff did not seek a determination of child support in accordance with the present needs of the parties' youngest child and the parties' present income and assets; she simply sought a continuation of the child support amount set for two children in the PSA.
In addition to an order compelling defendant to pay child support at the rate of $50,000 per year, plaintiff sought an order compelling defendant to reimburse her for the incremental cost of health insurance retroactive to 1998 and life insurance retroactive to 2002. Plaintiff contended that she was owed a total of $25,211.18 for these payments, $21,491.18 for the ...