SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
A-724-97T3
MARK D. CARTER,
Plaintiff-Appellant,
v.
KAREN L. CARTER,
Defendant-Respondent.
Submitted December 1, 1998 - Decided
February 3, 1999
Before Judges Pressler, Brochin, and Kleiner.
On appeal from the Superior Court of
New Jersey, Chancery Division, Family Part,
Middlesex County.
Robert Musto, attorney for appellant (Anthony
M. DeBari, on the brief).
Respondent's brief suppressed.
The opinion of the court was delivered by
KLEINER, J.A.D.
Plaintiff Mark D. Carter appeals from an amended order
granting permanent alimony to his former wife, defendant Karen L.
Carter, on defendant's motion filed more than two years
subsequent to plaintiff's final payment of rehabilitative
alimony. See N.J.S.A. 2A:34-23b. After a plenary hearing, the
motion judge granted defendant's motion seeking an award of
permanent alimony and an increase in child support memorialized
in an order dated May 1, 1997. Thereafter both parties sought
reconsideration. Based upon the respective cross-motions, the
judge modified the provision of the May 1, 1997, order pertinent
to child support, but denied plaintiff's reconsideration motion
pertinent to the award of permanent alimony.See footnote 1 Plaintiff appeals
solely from the provision of the amended order, memorialized
August 19, 1997, requiring the payment of $165 per week as
permanent alimony. For the reasons discussed, we reverse and
remand for reconsideration of the provision of the judge's
decision granting permanent alimony to defendant.
. . .
12. Except as otherwise herein
expressly provided, the parties shall and do
hereby mutually remise, release, and forever
discharge each other from any and all suits,
actions, debts, claims, demands, and
obligations whatsoever, both in law and in
equity, that either of them ever had, now
has, or may hereafter have against the other
or by reason of any matter, cause or thing up
to the date of the execution of this
agreement, except for the action for personal
injury pending from the accident on or about
May 29, 1989. Parties agree settlements or
verdicts shall not be grounds for change of
circumstances on child support or alimony
during the next three (3) years.See footnote 4
A judgment of divorce was entered January 4, 1991. The written
agreement between the parties was incorporated within the terms
of the divorce judgment.See footnote 5 The judge who presided at the divorce
proceeding only considered testimony pertinent to the causes of
action for the divorce and pertinent to his conclusion that the
written agreement represented the voluntary act of each party
after each had consulted with counsel. The judge did not elicit
any testimony pertinent to the provisions within the agreement
respecting the payment of rehabilitative alimony.
On December 15, 1995, defendant filed a motion returnable
January 19, 1996. Defendant sought a permanent reinstatement of
alimony in the amount of $165 per month, a re-evaluation of child
support, an order compelling plaintiff to file an updated case
information statement, and counsel fees and costs. In
defendant's certification, she contended, among other things,
that she had been unemployed as of the date of the separation
agreement but thereafter, while recuperating from the injuries
sustained in the motorcycle collision, enrolled as a student at
the Sitone Institute to become a court reporter. She had not
been gainfully employed since the date of the motorcycle
collision. Furthermore, because of knee surgery following the
collision, she had been declared permanently disabled by the
Social Security Administration and was awarded, effective May 23,
1995, $530 per month as permanent disability. The parties' son
had been awarded $253 per month by virtue of defendant's
disability.See footnote 6 She further contended that her permanent
disability had caused her to withdraw from court reporting
school. Defendant also certified that her personal injury claim
had been settled for $250,000, but netted her $43,000 after a
deduction of attorney's fees and the payment of unreimbursed
medical expenses.See footnote 7 Defendant also certified that she had
utilized the entire net settlement to defray her living expenses
once her rehabilitative alimony payments ceased, as well as to
satisfy additional claims of medical providers.
In response to defendant's motion, plaintiff denied any
responsibility to pay alimony and filed a cross-motion seeking a
reduction in his child support payments. The primary thrust of
plaintiff's response to defendant's permanent alimony claim was
his contention that defendant had agreed to rehabilitative
alimony and that he had fully complied with the provisions of the
separation agreement, having paid the entire sum required as
rehabilitative alimony. The motion judge scheduled a plenary
hearing.
At the conclusion of the plenary hearing the judge granted
defendant's alimony claim and granted plaintiff's cross-motion
seeking a reduction in child support. As noted, after an order
memorializing this decision was executed, each party by separate
motion sought reconsideration. The original order reducing
plaintiff's child support obligation was recomputed and an
amended order was entered. All other requested relief was denied
to both parties. It is from the amended order that plaintiff
appeals.See footnote 8
An award of rehabilitative alimony may
be modified based either upon changed
circumstances, or upon the nonoccurrence of
circumstances that the court found would
occur at the time of the rehabilitative
award.
[emphasis added.]
We consider the statutory mandate that the court make
specific findings on rehabilitative alimony as a clear direction
to the Family Part that it must adhere to the statutory
requirement in every case, whether contested or uncontested,
including those cases which result in a settlement on the day of
trial or during a trial. We previously stressed the importance
of adherence to the statutory admonition in our discussion in
Cerminara v. Cerminara,
286 N.J. Super. 448, 459 (App. Div.
1996). We adhere to our view that N.J.S.A. 2A:34-23b must be
addressed in every dissolution proceeding where rehabilitative
alimony will be paid subsequent to the dissolution of a marriage.
[Ibid. (emphasis added).]
Shifman clearly instructs that a motion to convert
rehabilitative alimony to permanent alimony should be filed prior
to the termination of the rehabilitative alimony payments but
reasonably close to the date that rehabilitative alimony is to
end, so as to provide the motion judge with current information
to assess the "anticipated needs and the [financial] resources of
the parties." Ibid. In Milner, the plaintiff sought to convert
rehabilitative alimony to permanent alimony prior to and shortly
before the expiration of the rehabilitative alimony term.
Milner, supra, 288 N.J. Super. at 212.
Arguably, language within both Milner and Shifman might be
construed to support plaintiff's contention that conversion from
rehabilitative alimony to permanent alimony must occur during the
period of rehabilitative alimony payments and shortly before the
payment of rehabilitative alimony ends. However, it is clear
that neither Milner nor Shifman specifically limits a spouse's
right to seek permanent alimony to an application filed during
the period that rehabilitative alimony is being paid. Lepis,
supra,
83 N.J. 139, does not impose such limitation and, in fact,
reiterates varied circumstances which permit a modification of
alimony and emphasizes that the overriding equitable
consideration is a determination "whether the former marital
standard of living is being maintained." Id. at 150-51
(citations omitted). Yet, conversely, Lepis also instructs that
the terms of any matrimonial settlement agreement "should receive
continued enforcement without modification only so long as they
remain fair and equitable." Id. at 148-49. See also Shifman,
supra, 211 N.J. Super. at 194. Arguably, had the record at the
divorce proceeding clearly reflected that neither party intended,
despite a change of circumstances reasonably anticipatable at the
time of their agreement, plaintiff's obligation to extend beyond
a three year period, and assuming further the motion judge
concluded that the agreement as negotiated remained "fair and
equitable," Lepis, supra, 83 N.J. at 148-49, defendant's
application in this case might have been denied.
The determination of the standard of living of the parties
is one of the statutory components which a court must consider in
awarding permanent alimony. N.J.S.A. 2A:34-23b provides that a
court shall consider:
(1) The actual need and ability of the
parties to pay;
(2) The duration of the marriage;
(3) The age, physical and emotional
health of the parties;
(4) The standard of living established
in the marriage and the likelihood that each
party can maintain a reasonably comparable
standard of living;
(5) The earning capacities, educational
levels, vocational skills, and employability
of the parties;
(6) The length of absence from the job
market of the party seeking maintenance;
(7) The parental responsibilities for
the children;
(8) The time and expense necessary to
acquire sufficient education or training to
enable the party seeking maintenance to find
appropriate employment, the availability of
the training and employment, and the
opportunity for future acquisitions of
capital assets and income;
(9) The history of the financial or
non-financial contributions to the marriage
by each party including contributions to the
care and education of the children and
interruption of personal careers or
educational opportunities;
(10) The equitable distribution of
property ordered and any payouts on equitable
distribution, directly or indirectly, out of
current income, to the extent this
consideration is reasonable, just and fair;
and
(11) Any other factors which the court
may deem relevant.
[Id. (emphasis added).]
Here, the judge recognized that he was obliged to consider
the standard of living of the parties during the marriage and
relied upon our discussion in Walles v. Walles,
295 N.J. Super. 498 (App. Div. 1996), to the effect that "the original judgment
establishing alimony creates the standard of living of the
supported spouse." Id. at 512. Although the judge correctly
cited Walles, its holding is inapposite to the issue presented by
defendant's motion. Here, the original judgment of divorce did
not, as in Walles, award permanent alimony, but only awarded
rehabilitative alimony pursuant to N.J.S.A. 2A:34-23b. Since any
award of permanent alimony to defendant would constitute her
first permanent alimony award, it was incumbent upon the judge to
consider all of the statutory factors enumerated in N.J.S.A.
2A:34-23b(1 to 11) as if deciding the permanent alimony ab
initio. Had the judge considered all statutory factors, he would
have particularly considered N.J.S.A. 2A:34-23b(2) "The duration
of the marriage." As noted, the parties were married on August
24, 1979, separated on April 3, 1988, and were divorced by a
judgment entered January 4, 1991. It is not clear from those
facts that an award of permanent alimony would have been
considered appropriate ab initio. See Heinl v. Heinl,
287 N.J.
Super. 337, 346 (App. Div. 1996) (noting judicial error in
failing to fully articulate why a relatively short marital life
required an award of permanent alimony rather than rehabilitative
alimony); cf. Hughes v. Hughes,
311 N.J. Super 15, 32-33 (App.
Div. 1998) (discussing duration of the marriage as a factor in
determining an award of permanent alimony, rehabilitative
alimony, or both).
We recognize that the motion judge carefully analyzed the
case information statement filed by defendant in 1990 prior to
the judgment of divorce with a case information statement filed
in support of her motion for permanent alimony. Yet he failed to
make any finding that the sum which the parties negotiated as
rehabilitative alimony was, in fact, the same sum which would
have been awarded defendant as permanent alimony ab initio. Had
the original judgment awarded permanent alimony and had defendant
sought a modification predicated upon a change in circumstances
attributable to her medical condition, the methodology of the
motion judge would have been correct. As noted in Lepis, supra,
83 N.J. at 152, "When 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."
The sum negotiated as rehabilitative alimony may be
influenced solely by economic factors attributable to
rehabilitation and may not have any bearing upon the standard of
living of the parties during the marriage.See footnote 9 That is one
principle reason why the amount of rehabilitative alimony may not
be dispositive of a later judicial decision awarding permanent
alimony. Although it is conceivable that the sum negotiated as
rehabilitative alimony would have been the same sum awarded as
permanent alimony at the time of the divorce, without a specific
finding by the motion judge of that fact we are unable to
properly evaluate the judge's decision. See Curtis v. Finneran,
83 N.J. 563, 569-70 (1980); Rolnick v. Rolnick,
290 N.J. Super. 35, 42-43 (App. Div. 1996); Ribner v. Ribner,
290 N.J. Super. 66,
76-77 (App. Div. 1996).
We recognize that many payor spouses may reasonably believe
that their obligation to pay alimony will cease at the conclusion
of any rehabilitative period in the absence of a separate
provision requiring the payment of both rehabilitative alimony
and permanent alimony. See Hughes v. Hughes, supra, 311 N.J.
Super. at 32; Kulakowski v. Kulakowski,
191 N.J. Super. 609 (Ch.
Div. 1982). Because we have concluded that the fulfillment of an
obligation to pay rehabilitative alimony does not per se prohibit
a former spouse from thereafter seeking permanent alimony, we
conclude that the motion judge, when asked to consider a
permanent alimony demand by a former spouse, must consider
changes in the payor spouse's lifestyle between the date when
rehabilitative alimony ends and the date when the former
supported spouse seeks permanent alimony. Here, once plaintiff's
obligation to pay rehabilitative alimony ended, he had the right
to allocate his financial resources to other financial
obligations. Although the motion judge observed that plaintiff's
income had increased from the sum earned in 1990, he failed to
specifically analyze plaintiff's existing financial obligations
and to determine whether plaintiff's present obligations were
incurred after he fully complied with his rehabilitative alimony
obligation during a period of time that defendant was silent as
to her financial needs. Nor did the judge fully consider
plaintiff's testimony that his gross income in 1996See footnote 10 reflected
substantial overtime salary. Although overtime pay is a factor
to be included in any financial analysis, the judge must consider
whether the receipt of overtime income is sporadic. Cf.
Pressler, Current New Jersey Court Rules, Appendix IX-B, 2029-30,
2047-48 (instructing that, for the purpose of determining child
support, "overtime pay" is deemed "sporadic income" requiring the
inclusion in the gross income calculation "the average . . . on
the prior 12 months or first receipt whichever time is greater").
Another equitable consideration which must be addressed by
the motion judge on remand is the passage of time between the
date when rehabilitative alimony ended and the date of
defendant's motion seeking permanent alimony. Although the
passage of time cannot itself bar a spouse from seeking alimony
based upon a change in circumstances, clearly as time passes, the
equities which permit an award of permanent alimony will ebb.
Here, defendant's motion was filed 106 weeks after plaintiff
ceased paying rehabilitative alimony. In September 1993, two
months prior to the cessation of rehabilitative alimony,
defendant received a net settlement in her tort litigation of
$43,000. Plaintiff, under paragraph 12 of the property
settlement agreement, ante, was prohibited from seeking a
reduction in his rehabilitative alimony obligation based upon
defendant's settlement. Although defendant testified that she
used an unspecified portion of that net settlement to defray on-going medical treatment, she admitted that she used the balance
for current living expenses. Hypothetically, had defendant
allocated $40,000 to a fund to offset current living expenses and
had she deducted from the allocated fund, $165 per week, the
fund, excluding any accretion attributable to interest, would
have been dissipated after 242 weeks. We suggest that the motion
judge should have considered defendant's settlement in evaluating
her application for permanent alimony, particularly in
determining whether continued enforcement of the property
settlement agreement without modification might be fair and
equitable. Lepis, supra, 83 N.J. at 148-49.
In sum, the decision to grant or deny defendant's motion for
permanent alimony should have been considered utilizing the
statutory standards enunciated in N.J.S.A. 2A:34-23b, however,
subject to: a consideration of the parties' prior rehabilitative
agreement; equitable considerations, which include the passage of
time; plaintiff's current financial obligations incurred after
rehabilitative alimony ceased; defendant's receipt of a net
settlement of $43,000, and the fact that the parties' agreement
prohibited plaintiff from seeking a reduction of rehabilitative
alimony predicated upon defendant's settlement; and with
recognition of the concept that the "terms of a negotiated
agreement should receive continued enforcement without
modification only so long as they remain fair and equitable."
Lepis, supra, 83 N.J. at 148-49.
Reversed and remanded for reconsideration.
Footnote: 1 This opinion does not address any other issue raised by
either party in the initial post-judgment motion or on
defendant's motion for reconsideration. Although defendant filed
a cross-appeal, her brief on appeal was suppressed.
Footnote: 2 Although plaintiff apparently filed a complaint for
compensatory damages against the other motor vehicle operator,
the nature and extent of his injuries and the terms of an
ultimate settlement of that litigation have not been provided
within the record on this appeal.
Footnote: 3 At a subsequent plenary hearing, discussed infra,
uncontradicted testimony was presented that the home equity debt
was $14,000 and the initial debt was incurred to defray the cost
of home repairs and to purchase a motorcycle. Plaintiff retained
title to the motorcycle as a component of the equitable
distribution of property provisions in the agreement.
Footnote: 4 The underlined portion of clause 12 was a handwritten
addition to the typed form of the agreement.
Footnote: 5 The Judgment further provided:
Ordered, based upon a further agreement of
the parties as spread upon the record, as
follows:
a. that Plaintiff shall pay to the
attorney for Defendant a $500.00 counsel
fee, as previously ordered, by Order
filed April 25, 1990;
b. that the issue of counsel fees
relative to the within matter shall be
determined by the Hon. Mark B. Epstein,
upon the submission to the Hon. Mark B.
Epstein of a Certification of Services
submitted by any party seeking counsel
fees herein and any response thereto.
Footnote: 6 At the plenary hearing, defendant testified that her
monthly Social Security disability benefits and her son's
disability benefits had just recently been increased but she was
unable to recall the exact extent of the increase in monthly
benefits. The motion judge ultimately utilized the exact prior
benefit figures in determining both permanent alimony and child
support.
Footnote: 7 In separate litigation, defendant sought to recover
reimbursement of all medical bills attributable to the
motorcycle-commercial van collision. Plaintiff's comprehensive
motorcycle liability insurance policy limited defendant's right
to recover medical expenses to $10,000. Although defendant
prevailed in the Law Division in her claim that plaintiff's
insurer was responsible for all of defendant's medical expenses,
on appeal filed by the insurer, in an unreported decision, we
reversed the Law Division judgment.
During the plenary hearing on defendant's motion and on the
cross-motions for reconsideration, discussed infra, it was
undisputed that defendant only received a net sum of $43,000 in
the settlement of her personal injury claims against plaintiff
and the commercial vehicle that collided with plaintiff's
motorcycle.
Footnote: 8 Although defendant filed a cross-appeal, she failed to
file a brief in support of her cross-appeal. Defendant's cross-appeal was therefore administratively dismissed.
Footnote: 9 A clarification of the parties' intent at the time of the
divorce may also reveal that the parties actually intended
"limited term alimony," in lieu of a lump-sum payment, but
selected the words "rehabilitative alimony" as a substitute
denomination. See Frank Louis, Limited Duration Alimony, 1
991 N.
J. Family Law. 133 (1991).
Footnote: 10 The plenary hearing on defendant's motion was conducted
on January 22 and 23, 1997.