October 11, 2012
JENNIFER FOLEY, PLAINTIFF-RESPONDENT,
THOMAS FOLEY, DEFENDANT-APPELLANT.
On appeal from Superior Court of New Jersey, Chancery Division, Family Part, Bergen County, Docket No. FM-02-2574-09.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted September 20, 2012
Before Judges Fuentes, Grall and Ashrafi.
Alleging long-term unemployment, defendant Thomas Foley appeals from an order of the Family Part denying his motion to reduce his alimony obligation pursuant to a judgment of divorce. We conclude that the Family Part denied ex-husband's motion under a misconception of the relevant period of unemployment.
We reverse and remand for reconsideration and potentially for an evidentiary hearing to determine whether ex-husband has proven changed circumstances in accordance with Lepis v. Lepis, 83 N.J. 139 (1980).
The parties married in 2004 and divorced in 2010. They have one child, a daughter born in 2005. During the marriage, ex-husband worked as a human resources manager in New York, with an ending salary of $94,500 (about $1,817 gross per week). At the end of May 2010, while the divorce action was pending, ex-husband was involuntarily terminated from his position, and he began collecting unemployment benefits of $405 per week. He remained unemployed at the time that a divorce trial was held resulting in a dual judgment of divorce entered on November 19, 2010.
The judgment of divorce granted the parties joint legal custody of the child, with ex-wife Jennifer Foley as the parent of primary residence and ex-husband entitled to two mid-week parenting times. Although we have not been provided transcripts from the trial or a statement of reasons for the trial judge's rulings, it appears from counsel's remarks on the post-judgment motions that the trial court concluded the five-and-a-half month period of unemployment at the time of trial was not of sufficient duration to justify limiting ex-husband's income to the amount of unemployment benefits.
The trial judge imputed income of $85,000 to ex-husband, and he was ordered to pay limited duration alimony for three years at $18,000 per year, that is, $346 per week, commencing February 1, 2011. He was also ordered to pay $50 per week in child support until February 1, 2011, at which time child support would be recalculated based upon the adjusted incomes of the parties, taking into consideration the alimony obligation and either imputed or actual income for each. Additionally, the judgment required ex-husband to pay 72% of marital debts and ex-wife to pay 28%. Ex-husband was also ordered to pay a total of $15,000 at the rate of $416.66 per month as reimbursement of attorney's fees incurred by ex-wife. Other financial considerations, such as the sale of the marital home and division of IRA and 401K accounts, were included in the judgment as equitable distribution of marital assets.
Initially, the Probation Department arranged for garnishment of ex-husband's unemployment benefits to cover the $50 per week in child support and to provide $30 per week toward the alimony obligation. As arrears accumulated, however, the Probation Department moved for enforcement of ex-husband's support obligation. In May 2011, a hearing officer determined that ex-husband had arrears of $4,604 and recommended that he pay a total of $416 per week, consisting of $50 child support, $346 alimony, and $20 toward the arrears. A Family Part judge approved the recommendation and signed an order authorizing the Probation Department to issue an arrest warrant if ex-husband missed two or more payments.
In June 2011, ex-husband filed a motion to reduce or abate his alimony payments based on changed circumstances. Ex-wife responded with a cross-motion to enforce the support payments and to adjust child support retroactive to February 1, 2011, as ordered in the judgment of divorce. Ex-husband submitted a case information statement with his motion indicating that he had earned income of $36,342 in 2010 and received unemployment benefits of $21,337, for a total income in the prior year of $57,679 (about $1,109 gross per week).
At the time of oral argument on the post-trial motions in August 2011, ex-husband and his attorney stated that he had obtained temporary employment in June 2011 at an hourly wage, but he was still netting less than $400 per week. The Probation Department had ordered garnishment of his wages from temporary employment at the rate of 65%, which together with an additional $70 per week that he was paying toward his arrears, left him with less than $120 per week for his own living expenses. He argued he could not pay his temporary housing expenses at a motel, at a long-term monthly rate of $38.41 per night, or to pay other minimal living expenses so that he could continue searching for a job. He had applied for food stamps in January 2011. He also stated he had been diagnosed with ataxia, which according to his doctor, "would interfere with his work as he cannot ambulate well."*fn1 Furthermore, he suffered from panic attacks as a result of the stress of divorce and threats from the Probation Department to have him arrested. He claimed he had paid $169.72 per month for COBRA insurance coverage that increased to $443.50 per month and that he has an additional $80 of monthly medical expenses.
Ex-husband asserted he had made good faith efforts to find permanent employment. He applied for approximately 200 jobs by email, with 187 of those applications submitted through an employment website. He provided documentary evidence of rejections from several positions after interviewing for those jobs.
Ex-wife had moved with the child to her parents' home. She was employed as a phlebotomist at wages of $18 per hour, thirty-five hours per week. She stated her parents were paying for her attorney's expenses but should not be obligated to provide financial support for her and the child.
The trial court declined to hold a hearing on ex-husband's application for abatement or reduction of alimony, determining that his unemployment remained a temporary condition because only seven months had elapsed between the judgment of divorce in November 2010 and the filing of his motion in June 2011. Based on the wife's actual income and alimony and ex-husband's imputed income of $85,000, the court increased his child support obligation to $151 per week retroactive to February 1, 2011.
To address some of ex-husband's concerns, the court ordered that he would not be arrested so long as he continued to make payments by garnishment as directed by the Probation Department. The court declined to reduce the amount of garnishment and also stated that ex-husband would remain obligated to pay accumulated arrearages in the future after he became employed. Ex-husband filed a notice of appeal from those rulings.
We apply an abuse of discretion standard of review to the Family Part's decision on whether a change in circumstances warrants modification of alimony or child support and also on the imputing of income to an unemployed or under-employed spouse. See Larbig v. Larbig, 384 N.J. Super. 17, 21 (App. Div. 2006); Storey v. Storey, 373 N.J. Super. 464, 470, 474-75 (App. Div. 2004).
Changed circumstances may be an increase or decrease in income or an illness arising after the original judgment. See Lepis, supra, 83 N.J. at 151. The Family Part must consider whether "changed circumstances have substantially impaired the [spouse's] ability to support himself or herself." Id. at 157.
However, "[c]courts have consistently rejected requests for modification based on circumstances which are only temporary." Id. at 151. Premature filing of a Lepis motion will justify its denial on the ground that the change has not been shown to be a permanent condition or of lasting duration. Larbig, supra, 384 N.J. Super. at 23; see also Donnelly v. Donnelly, 405 N.J.
Super. 117, 128 (App. Div. 2009) (Lepis motion was properly denied following similar motion filed nine months earlier).
In Larbig, as in this case, the ex-husband argued that his income had decreased substantially and he was obligated to pay virtually all of it for alimony. Larbig, supra, 384 N.J. Super. at 22. We affirmed the trial court's finding that twenty months between the divorce and the motion for modification was too short a time to consider the change to be permanent. Id. at 22- 23. In Larbig, however, the ex-husband was operating his own business and had some control over the income he was receiving. Furthermore, his alimony and other payment obligations arose from a property settlement agreement the parties had negotiated at the time of the divorce. The ex-wife claimed that the alleged downturn in financial circumstances of the business were present at the time of the parties' agreement. Ibid.
Here, ex-husband was terminated by his employer, presumably without any fault or voluntary action on his part. Also, the parties had not come to an agreement on support obligations; those matters were determined as contested issues at a trial. Furthermore, the economic circumstances of the present time, including much higher unemployment rates than are usual, should have been considered in determining whether ex-husband made a prima facie showing of prolonged involuntary unemployment.
"Determining the impact and magnitude of 'changed circumstances' necessarily entails knowing the starting point before the change, that is, the point from which the change can be measured." Foust v. Glaser, 340 N.J. Super. 312, 316 (App. Div. 2001). Here, the Family Part viewed the ex-husband's motion as premature because it was filed about seven months after the divorce judgment. But the date of the divorce judgment was not the appropriate starting point in considering whether his unemployment was a temporary or a long-lasting condition. Ex-husband had lost his job at the end of May 2010. At the time of the divorce trial, only about five-and-a-half months had passed, and the trial judge apparently concluded the time lapse was not sufficient to consider the unemployment more than temporary. That decision of the trial court should not preclude the ex-husband from arguing some ten months later that the entire period of unemployment should be taken into account in assessing changed circumstances. Otherwise, the happenstance of the divorce trial and judgment occurring during the period of unemployment distorts the true picture of ex-husband's financial circumstances as a result of his unemployment.*fn2
At the time of the Family Part's decision on the post-judgment motions, ex-husband had been unsuccessful for about fifteen months in finding new comparable employment. The Family Part should either have accepted ex-husband's documented evidence as being unrefuted or it should have conducted an evidentiary hearing to determine whether ex-husband had made sufficient efforts to find employment and whether his unemployment constitutes substantial, non-temporary changed circumstances under Lepis, supra, 83 N.J. at 157-59.
We remand for reconsideration of ex-husband's motion to abate or reduce payment of alimony. The trial court must review the current financial circumstances of the parties as it affects imputed income of ex-husband and both alimony and child support. If contested factual issues are revealed by updated submissions, the court must conduct an evidentiary hearing to resolve those issues.
We do not suggest that the court must relieve ex-husband of the obligation to pay limited duration alimony. We leave open to the Family Part's discretion whether it is appropriate to modify or suspend all or part of the alimony payments pending his re-employment or a future application to reinstate the obligation. Assuming that ex-wife has been compelled to borrow from her parents or from other sources to pay her expenses, a temporary suspension of the alimony obligation might adequately address ex-husband's current financial circumstances but also allow future compensation of ex-wife for unanticipated debts as a result of his changed circumstances. After the court determines the parties' present actual or imputed incomes, it must compute child support in accordance with those determinations under the Child Support Guidelines. See Pressler & Verniero, Current N.J. Court Rules, App'x IX to R. 5:6A (2013).
We reverse and remand for reconsideration of ex-husband's motion and a plenary hearing if necessary. We do not retain jurisdiction.