August 6, 2009
DIANE ADAMS, PLAINTIFF-RESPONDENT,
JAMES ADAMS, DEFENDANT-APPELLANT.
On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Camden County, Docket No. FM-04-1117-01-V.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued November 3, 2008
Before Judges R. B. Coleman and Sabatino.
Defendant James Adams appeals from a November 9, 2007 order of the Family Part which denied his motions requesting alimony modification and financial discovery and established that defendant is responsible for sixty-two percent of his child's college expenses.
The parties were married on May 24, 1975 and divorced on September 24, 2001. Although four children were born of the marriage, only one child remained unemancipated at the time of the divorce. The Final Judgment of Divorce incorporated the parties' Property Settlement Agreement (PSA), which provided that defendant would pay permanent alimony in the amount of $1,200 and child support for the one unemancipated child in the amount of $800. The PSA also provided that alimony would be reviewed by the parties or a court of competent jurisdiction after ten years from the entry of the Final Judgment of Divorce.
Under the PSA, the child would be emancipated upon reaching the age of eighteen or upon graduating from high school, unless she was "enrolled or scheduled to begin a post-high school course of study such as college or technical school." She would also be emancipated if she began college full-time, but did not complete higher education. The PSA provided further that "[t]he child shall, however, have two semesters from the date of the last semester to re-enroll in college on a full-time basis. If the child does return to college full-time during said period, the child shall be unemancipated and the terms of this Agreement shall be reinstituted."
In addition, the parties agreed to bear joint responsibility for the cost of the child's post-high school education "based on their respective financial circumstances at the time [the child] is accepted to the education institution she will be attending." The PSA further specifies:
As set forth in the case law in the state of New Jersey (specifically Newburgh v. Arrigo), the parties shall divide, according to their proportionate share of income at the time [the child] is prepared to enroll in college, responsibility for the unreimbursed costs (tuition, room and board, if applicable, administrative costs, books, etc.) associated with [the child's] post-secondary education. As of the execution of this agreement, the parties' proportionate shares are Husband, 62% and Wife, 38%.
Both parties shall be involved in choosing a post-secondary educational institution for [the child]. [The child] shall be required to apply for all available loans, grants, scholarships, etc., before each party's proportionate share of college expenses is calculated.
On September 20, 2007, defendant filed a motion to (1) terminate or reduce alimony and (2) emancipate the parties' twenty-year-old child, or alternatively set an appropriate order for college contribution. The Family Part judge concluded that the parties' PSA controlled and found that, pursuant to the PSA, defendant's share of the child's college expenses was sixty-two percent and that defendant's obligation to pay alimony would terminate upon remarriage or death. The PSA was silent as to the effect of cohabitation.
On appeal, defendant contends that he had made out a prima facie showing of cohabitation, and the Family Part erred in failing to shift the burden on that issue to plaintiff. Plaintiff acknowledges that, in June 2008, she had been cohabitating with another man for approximately two years. She contends, however, that cohabitation is not a ground for alimony modification under the parties' PSA.
We begin our discussion by noting that because "alimony and support orders define only the present obligations of the former spouses[,] [t]hose duties are always subject to review and modification on a showing of 'changed circumstances.'" Lepis v. Lepis, 83 N.J. 139, 146 (1980). Importantly, consensual agreements and judicial decrees are reviewed under the same standard of changed circumstances. Id. at 148 (citations omitted). Thus, "the extent of the change in circumstances, whether urged by plaintiff or defendant, shall be the same, regardless of whether the support payments being questioned were determined consensually or by judicial decree." Smith v. Smith, 72 N.J. 350, 360 (1977).
Where the PSA is "silent on the issue of cohabitation and its impact on spousal support," the court must "decide the issue based on decisional law rather than by construing the settlement agreement." Ozolins v. Ozolins, 308 N.J. Super. 243, 247-48 (App. Div. 1998). An application for modification of a PSA is governed by the same standard as the original judgment of divorce. Miller v. Miller, 160 N.J. 408, 420 (1999). That is, "[w]hen support of an economically dependent spouse is at issue, the general considerations are the dependent spouse's needs, that spouse's ability to contribute to the fulfillment of those needs, and the supporting spouse's ability to maintain the dependent spouse at the former standard." Lepis, supra, 83 N.J. at 152.
"[O]ne of the procedural prerequisites to discovery and a hearing in a modification proceeding under Lepis is an initial showing of changed circumstances." Gayet v. Gayet, 92 N.J. 149, 155 (1983). Cohabitation constitutes such changed circumstances. Ibid.; see also Ozolins, supra, 308 N.J. Super. at 248 (citing Lepis, supra, 83 N.J. at 151) ("[C]ohabitation by a supported spouse may constitute changed circumstances justifying discovery and an evidentiary hearing."). The test for whether cohabitation warrants modification of the alimony award is based on economic needs. Gayet, supra, 92 N.J. at 155. A decrease in alimony is appropriate "when circumstances render all or a portion of support received unnecessary for maintaining" the "standard of living reflected in the original decree or agreement." Lepis, supra, 83 N.J. at 153. We have concluded that alimony modification is appropriate where "'(1) the [cohabitant] contributes to the dependent spouse's support, or (2) the [cohabitant] resides in the dependent spouse's home without contributing anything toward the household expenses.'" Ozolins, supra, 308 N.J. Super. at 248 (quoting Gayet, supra, 92 N.J. at 153).
Significantly, "a showing of cohabitation creates a rebuttable presumption of changed circumstances shifting the burden to the dependent spouse to show that there is no actual economic benefit to the spouse or the cohabitant." Id. at 245. In the present case, plaintiff did not rebut such presumption, although admitting to cohabitating with another man for two years. Consequently, the alimony issue must be remanded for a plenary hearing which, among other things, will address the pertinent financial considerations of income and needs.
Defendant further contends that the Family Part judge erred by failing to analyze the factors in Newburgh v. Arrigo, 88 N.J. 529 (1982), in determining defendant's college contribution and whether his child-support obligation should have been reduced based on a change in circumstances. In Newburgh, supra, the Court noted that although "[g]enerally parents are not under a duty to support children after the age of majority[,]... in appropriate circumstances, the privilege of parenthood carries with it the duty to assure a necessary education for children."
88 N.J. at 544. The Court then enumerated a series of non-exclusive factors to be considered in evaluating a "claim for contribution toward the cost of higher education." Id. at 454.
In the case at bar, defendant agreed to contribute to his child's college expenses pursuant to certain conditions. The parties' PSA is clear in regards to college contribution, but is subject to an analysis of subsequent earnings and other updated financial information. The record before us does not provide an adequate basis to evaluate whether there has or has not been a sufficient change in circumstances to depart from the presumptive sixty-two/thirty-eight percent allocation stated in the PSA.
It is well established that matrimonial agreements are contractual in nature. Pacifico v. Pacifico, 190 N.J. 258, 265 (2007). "As a general rule, courts should enforce contracts as the parties intended." Id. at 266 (citations omitted). Where the terms of a contract are unambiguous, "the court must enforce it as written." County of Morris v. Fauver, 153 N.J. 80, 103 (1998) (citation omitted). The interpretation of a contract is a matter of law and subject to de novo review on appeal. Fastenberg v. Prudential Ins. Co. of Am., 309 N.J. Super. 415, 420 (App. Div. 1998).
Under the PSA, the parties are to divide the child's college expenses "based on their respective financial circumstances at the time [the child] is accepted to the education institution she will be attending." In 2001, when the parties entered into the PSA, the parties' proportionate share would have been sixty-two percent for the husband and thirty-eight percent for the wife. The child was fourteen years old in 2001 and did not graduate from high school until 2005. The record lacks a finding of what each parent's proportionate share would have been when the child was accepted into college. In addition, pursuant to the PSA, the amount for which each party is responsible cannot be calculated until the record shows that the child has applied "for all available loans, grants, scholarships, etc.," so that it can be determined how such loans, grants and scholarships affect their respective shares.
We note that the child's full-time college attendance has been sporadic; however, during the motion hearing, defendant conceded that the child had returned to school and was, therefore, not emancipated. Nevertheless, the employment of a child may warrant reduction of child support. Lepis, supra, 83 N.J. at 152. Even where the child's income is temporary or insufficient to render the child economically self-sufficient and justify emancipation, such income might be enough to constitute a change in circumstances that warrants a reduction in child support. Tretola v. Tretola, 389 N.J. Super. 15, 21 (App. Div. 2006) (citing Lepis, supra, 83 N.J. at 146) (finding that the "Family Part judge was remiss in not requiring [the custodial parent] to submit documentation of [the child's] [college] credits and earnings and in dismissing the matter summarily"). In Tretola, we found that because the child was earning an income of $20,000 per year, through summer and part-time employment, the trial court should have considered "the factors set forth in N.J.S.A. 2A:34-23 to determine the proper level of support." Id. at 21. The present record here is simply inadequate to make a comparable analysis.
We accordingly remand for discovery and a plenary hearing on both the alimony issue and the college contribution issue. As we stated in Tretola, "the proceedings cannot take place in a vacuum and the court must consider [the parties'] current circumstances in calculating any future obligations." Id. at 21-22. In the interim, the support prescribed by the trial court shall continue, subject to any adjustments and credits that may be warranted after a plenary hearing.
Affirmed as to the denial of emancipation; remanded on the alimony and college contribution issues.
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