June 14, 2012
MARIAN PARISH, PLAINTIFF-RESPONDENT,
MELVIN PARISH, DEFENDANT-APPELLANT.
On appeal from Superior Court of New Jersey, Chancery Division, Family Part, Burlington County, Docket No. FM-03-667-01.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted April 30, 2012
Before Judges Ashrafi and Fasciale.
In this post-judgment matrimonial matter, defendant-ex-husband appeals from orders denying his motion for review of his alimony obligation and his motion for reconsideration. We reverse and remand for a plenary hearing.
The parties were married for almost ten years. They were divorced in November 2001. At the time of the divorce, husband was fifty-eight years old and wife was almost forty-seven years old. A property settlement agreement negotiated with the assistance of attorneys was incorporated into the judgment of divorce. It provided for equitable distribution of marital assets, including a fifty percent transfer of the marital portion of the husband's pension rights and 401(k) account to the wife and her right to keep the entirety of her own pension and bank accounts. Husband, in turn, retained the marital residence and agreed to pay all outstanding debts associated with the house.
By paragraph 3.1 of the agreement, husband agreed to pay $365 per week to wife in alimony. The same paragraph designated husband's income at that time as $6,265 gross per month and wife's income from a disability pension as $1,880 gross per month. The last sentence of the paragraph stated: "This alimony award shall be reviewable in seven (7) years."
Paragraph 3.1.5 of the agreement, entitled "Early Retirement," addressed the possibility that the husband could be offered an early retirement plan by his employer in lieu of involuntary termination. It provided that husband's acceptance of such an offer would not be considered a voluntary reduction of pay but also would not automatically warrant reduction of his alimony obligation.
Husband did not retire early from his employment. He retired at the end of 2009, after he reached sixty-five years old, and his income decreased to $3,720 per month. In October 2010, he filed a motion under paragraph 3.1 of the property settlement agreement for review and recalculation of his alimony obligation.
In a supporting certification, husband stated that the parties had anticipated at the time of the divorce that he would retire at sixty-five years old. He referred to his deteriorating medical conditions - cataracts that made it difficult for him to see a computer screen, high blood pressure, and diabetes. He stated he had already paid alimony to wife for a term longer than the time of the marriage, and he could no longer afford to pay it. He stated he was forced to use the equity in his home to borrow money for alimony and his own expenses.
The trial court heard argument and denied husband's motion without holding an evidentiary hearing. In a written decision, the court concluded that husband had not shown a prima facie case of changed circumstances in accordance with Lepis v. Lepis, 83 N.J. 139, 157-59 (1980), or justification for reduced income by retirement in accordance with Deegan v. Deegan, 254 N.J. Super. 350, 357-59 (App. Div. 1992). After the trial court denied husband's motion for reconsideration by an order dated April 1, 2011, husband filed this appeal.
We acknowledge that the Family Part is granted broad discretion in awarding financial support in a matrimonial action, including whether the amount of alimony should be modified. Innes v. Innes, 117 N.J. 496, 504 (1990); Larbig v. Larbig, 384 N.J. Super. 17, 21 (App. Div. 2006). The Family Part's conclusions on a motion to modify alimony are not disturbed on appeal unless the court has made an error of law, Avery v. Avery, 209 N.J. Super. 155, 163 (App. Div. 1986), or the court's ruling is "'so manifestly unsupported by or inconsistent with the competent, relevant and reasonably credible evidence as to offend the interests of justice[,]'" Walles v. Walles, 295 N.J. Super. 498, 513 (App. Div. 1996) (quoting Rova Farms Resort, Inc. v. Investors Ins. Co. of Am., 65 N.J. 474, 484 (1974)).
Here, the dispute involves construction and application of the parties' agreement, specifically, the meaning of the last sentence of paragraph 3.1: "This alimony award shall be reviewable in seven (7) years." The narrow question before us is whether husband was required as a matter of law, despite that provision, to show changed circumstances under Lepis, supra, 83 N.J. at 157-59, to be entitled to a post-judgment hearing to determine whether his alimony obligation should be reduced. We hold that the agreement could supersede the Lepis requirement of making a prima facie showing of changed circumstances, and that the proper interpretation of paragraph 3.1 required an evidentiary hearing to confirm the intent of the parties.
The trial court reasoned that because the property settlement agreement did not state expressly that husband intended to retire at age sixty-five, the seven-year review under paragraph 3.1 still required that he show changed circumstances to warrant a plenary hearing and potential modification of alimony. Based on the parties' written submissions on the motion, the trial court concluded that husband had not shown justification for retiring and thus reducing his income as he was required to do under the holding of Deegan, supra, 254 N.J. Super. at 358. The court then concluded that because husband had not shown that he was justified in retiring, he had not made an adequate showing of changed circumstances.
The trial court erred in interpreting the property settlement agreement without holding an evidentiary hearing and in applying the holding of Deegan to this case. Deegan considered the effect of the supporting spouse's decision to retire early at the age of sixty-two. Id. at 353. The issue was whether such voluntary early retirement warranted a reduction of alimony. Id. at 355-57. We concluded that the spouse seeking to reduce his support obligation as a result of voluntary early retirement must show that the advantages of his early retirement substantially outweigh the disadvantages to the supported spouse in reduction of her support payments. Id. at 358.
We have applied the analysis established by Deegan to circumstances where the supporting spouse voluntarily changed his career and thus reduced his income before retirement. Storey v. Storey, 373 N.J. Super. 464, 468-69 (App. Div. 2004). We have also applied the analysis in Deegan where the dependent spouse suffered a disadvantage because the supporting spouse continued working beyond normal retirement age and thus delayed the dependent spouse's ability to collect from his pension under the terms of equitable distribution in the divorce judgment. Moore v. Moore, 376 N.J. Super. 246, 247, 251-52 (App. Div.), certif. denied, 187 N.J. 37 (2005). However, no case that has been brought to our attention has applied the holding and reasoning of Deegan to the supporting spouse's retirement at the time of his normally anticipated retirement age. We decline to do so here.
It is especially inappropriate in the circumstances of this case to conclude that husband should not have retired in the normal course at the age of sixty-five. The seven-year review term may be an indication, as husband argues, that the parties anticipated such a change in financial circumstances at the time of the divorce and addressed the change by agreeing to an automatic review of alimony. The seven-year time frame coincides with husband's reaching sixty-five years old and normal retirement opportunities.
The trial court's reading of paragraph 3.1 does not take into account the husband's right under Lepis, supra, 83 N.J. at 145, to seek review and modification at any time if he could show changed circumstances. Husband did not need the quoted last sentence from paragraph 3.1 to seek review and modification of alimony based on changed circumstances. As husband argues, the prospect of future determination of his alimony obligation without such an initial showing may have been fairly bargained for in the settlement agreement in exchange for other considerations.
We hold that husband was entitled to an evidentiary hearing at least to establish that the parties intended an automatic seven-year review of his alimony obligation without a showing of changed circumstances. If the court finds that was the parties' intent, husband is entitled to a full review of his alimony obligation in accordance with all the statutory factors listed in N.J.S.A. 2A:34-23(b) as applicable at the time of the review.
We reverse and remand to the trial court to conduct a plenary hearing at which the parties shall be permitted to present evidence of their intent in paragraph 3.1. If husband demonstrates that the intent of the parties was for review of his alimony obligation without the need to show changed circumstances, or alternatively, that his anticipated retirement after seven years was deemed by the parties to be a sufficient showing of changed circumstances to warrant plenary review and potential modification of alimony, the court shall determine anew a proper type, duration, and amount of alimony based on N.J.S.A. 2A:34-23(b) through -23(g).
Reversed and remanded. We do not retain jurisdiction.
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