August 9, 2010
PAULA CARROLL BURROUGHS, PLAINTIFF-RESPONDENT,
DONALD WAYNE BURROUGHS, DEFENDANT-APPELLANT.
On appeal from Superior Court of New Jersey, Chancery Division, Family Part, Atlantic County, Docket No. FM-01-632-95C.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted June 29, 2010
Before Judges Stern and Skillman.
Defendant appeals from the part of a post-judgment order entered on March 25, 2009, which denied his motion to terminate or reduce his alimony obligation to plaintiff. Defendant contends that he made a prima facie showing of changed circumstances, which entitles him to conduct financial discovery. We agree. Therefore, we reverse the part of the March 25, 2009 order which denied defendant's motion for a termination or reduction of alimony and remand the case to the trial court to allow financial and other appropriate discovery to be exchanged between the parties.
The parties were married in 1969. After separating, the parties entered into a property settlement agreement in August 1994. At that time defendant was employed by New Jersey Bell at a salary of nearly $60,000 per year and plaintiff's income was $13,000 per year. The parties agreed that defendant would pay plaintiff $200 per week in alimony, which would be increased by 5% each year, and also provide her with medical insurance. The property settlement agreement also provided for the equitable distribution of the parties' assets and for support of the parties' two children. The child support provisions are no longer in issue because the children are emancipated.
Shortly after the execution of the property settlement agreement, defendant was terminated from his position with New Jersey Bell. As a result, defendant was unemployed when the parties were divorced a year later, in September 1995. Nevertheless, defendant agreed to the incorporation into the judgment of divorce of the property settlement agreement executed the year before. Defendant indicates that employment with subcontractors in the telephone field at a salary comparable to what he had earned at New Jersey Bell was available at that time, and he apparently expected to be able to obtain such employment.
Defendant obtained such employment sometime in 1996 and had income from 1997 through 2000 that was somewhat in excess of what he had earned at New Jersey Bell when the property settlement agreement was executed.*fn1 However, defendant alleges that this employment was no longer available after 2000 and he was forced to take a job at Home Depot, where he earned less than half what he had earned while working at New Jersey Bell and for subcontractors in the telephone field.*fn2
On March 31, 2006, an order was entered which increased defendant's alimony obligation to $337 per week. This order was apparently not based on a showing of changed circumstances but rather simply enforced the part of the parties' property settlement agreement which provided for a 5% annual increase in defendant's alimony obligation.
Defendant alleged that in 2007, in an effort to obtain a greater income than he could earn at Home Depot, he established a business with a friend that involved electronic tracking of container ships. However, that business failed, and defendant not only did not earn what he hoped to earn from that business but also lost a substantial part of his investment in the enterprise. Defendant and his friend then invested in another new business in the same field. Defendant alleged that this business "had and still has some good prospects for contracts but the horrendous downturn in the economy has prevented any such deals from coming to fruition[.]" However, defendant's earnings from this business thus far are even less than what he earned at Home Depot.
Defendant's reply certification further alleged that, as a result of the shortfall between his earnings at Home Depot for 2001 to 2006 and more recently from his two business ventures and his alimony obligations to plaintiff and his own living expenses, he has "used up almost all of [his] retirement funds" and is now supported by his parents. This certification also alleged that plaintiff inherited the house in which she now lives.
After oral argument, the trial court denied defendant's motion on March 13, 2009, which was memorialized by an order entered on March 25, 2009.
Under Lepis v. Lepis, 83 N.J. 139, 157 (1980) "[a] prima facie showing of changed circumstances must be made before a court will order discovery of an ex-spouse's financial status." A decrease in the supporting spouse's income is one form of changed circumstance that may warrant a modification of that spouse's alimony obligation. Id. at 151; see also Miller v. Miller, 160 N.J. 408, 420-21 (1999).
Defendant made a prima facie showing of changed circumstances based on his certifications and his social security statement. Those documents showed that, except for 1995 when he was unemployed, defendant had earned income during the years between 1994, when he executed the property settlement agreement, and 2000, that averaged more than $60,000, but that, from 2001 through 2006, while he was employed at Home Depot, he averaged less than half that income. Defendant also alleged, and plaintiff did not present any contrary evidence, that employment in the field of his expertise in the telecommunications field was no longer available after 2000 and that he worked at Home Depot for the following six years not as a matter of personal choice but rather because the $60,000 per year employment upon which his alimony obligation was predicated is no longer available to him. Defendant also noted that as a result of the provision in the property settlement agreement for a 5% annual increase in his alimony obligation, that obligation is now nearly double what it was at the time of execution of the property settlement. These allegations are sufficient to establish a prima facie case of changed circumstances that warrants an order for financial and other appropriate discovery that will afford an opportunity for an informed judicial determination of whether defendant is entitled to a modification of his alimony obligation. After such discovery has been conducted, the trial court should determine whether there are contested issues of fact regarding defendant's entitlement to a modification of alimony that require an evidentiary hearing. See Lepis, supra, 83 N.J. at 159.
Upon remand, the parties also may present appropriate proofs as to whether, as plaintiff alleged, defendant has been underemployed since 2000 and consequently the court should impute greater income than defendant has actually earned or is earning. See Storey v. Storey, 373 N.J. Super. 464, 472-80 (App. Div. 2004). The parties also may present evidence regarding any other factor relevant to the question whether defendant's alimony obligation should be modified.
Accordingly, the part of the March 25, 2009 order denying defendant's motion for a termination or reduction of his alimony obligation is reversed, and the case is remanded to the trial court for further proceedings in conformity with this opinion.