Mills v. Mills

145 A.3d 1105, 447 N.J. Super. 78, 2016 N.J. Super. LEXIS 132
CourtNew Jersey Superior Court Appellate Division
DecidedJune 21, 2016
StatusPublished
Cited by2 cases

This text of 145 A.3d 1105 (Mills v. Mills) is published on Counsel Stack Legal Research, covering New Jersey Superior Court Appellate Division primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Mills v. Mills, 145 A.3d 1105, 447 N.J. Super. 78, 2016 N.J. Super. LEXIS 132 (N.J. Ct. App. 2016).

Opinion

L.R. Jones, J.S.C.

This case presents legal issues involving an alimony obligor’s loss of employment and interpretation of the recent, 2014 amendments to New Jersey’s alimony statute, N.J.S.A. 2A:34-23(k). Specifically, defendant seeks a reduction of his alimony obligation to plaintiff based upon losing his prior long-term employment and subsequent obtaining of a new job at a significantly lower salary. In turn, plaintiff opposes an alimony reduction.

For the reasons set forth in this opinion, the court grants defendant’s application for a reduction in his alimony obligation, and holds the following:

(1) Under the recent 2014 amendments to New Jersey’s alimony statute, and newly enacted subsection N.J.S.A. 2A:34-23(k), a court may reduce an alimony obligation when the obligor loses his or her prior W-2 employment, and thereafter makes reasonable attempts to find substitute employment;
(2) In interpreting and applying the new statutory language to a case where an obligor loses his job and obtains replacement employment at a substantially lower salary, a fundamental approach to addressing such a situation inherently [81]*81involves two questions of equity: (A) Was the supporting spouse’s choice in accepting particular replacement employment objectively reasonable under the totality of the circumstances? (B) If so, what if any resulting adjustment in support is fair and reasonable to both parties under the facts of the case?
(3) The terms and spirit of the 2014 amended alimony statute, N.J.S.A. 2A:34-23(k), are relevant and applicable in this case, where the parties were divorced prior to September 10, 2014, but where (a) the parties’ agreement contained no contractual provision defining or limiting the standards for reviewing a modification of support based upon loss of employment and decrease in financial circumstances, and (b) the issue has not already been litigated and adjudicated by the court in prior post-judgment proceedings.

FACTUAL BACKGROUND

Plaintiff and defendant divorced in 2013 following thirteen years of marriage. They have two children, who are presently ages thirteen and eleven. At the time of their divorce, the parties agreed that defendant would pay plaintiff limited duration alimony in the amount of $330 per week for eight years, as well as child support of $200 per week, pursuant to the Child Support Guidelines, Current N.J. Court Rules, Appendix IX-A to Rule 5:6A. At the time of their settlement, defendant was employed as a district sales manager for a company selling residential and commercial flooring services, while plaintiff worked as a teacher.

The parties’ settlement agreement contained no contractual provision regarding what would happen to defendant’s support obligation in the event of a substantial change of circumstances, such as defendant’s loss of employment or reduction in income. The agreement was, however, expressly based upon a stipulated financial baseline of defendant earning gross income of approximately $108,000 per year, and plaintiff earning approximately $59,000 per year.

In January 2015, after twelve years of working at the same company in flooring sales, defendant involuntarily lost his job when his employer restructured its business plan and essentially eliminated defendant’s position. The employer provided defendant with a one-time severance payment of approximately $35,000, [82]*82along with a letter of recommendation regarding his positive job performance and history with the company.

Defendant shortly thereafter began searching for a new job, and in April 2015, received an offer of employment for a similar position from another company in the flooring industry, but at a significantly lower salary of approximately $70,000 per year, plus a $6,000 annual car allowance. Facing the economically difficult decision of whether to accept the job offer and lower salary or decline the opportunity and continue searching for another job at a salary closer to his prior income, defendant ultimately decided to accept the position and commenced employment.

After starting at his new job, defendant initially continued to pay plaintiff alimony at the same level of $330 per week, as he had the severance pay from his prior employment available as a temporary supplement to his now-reduced income. Approaching year’s end, however, he essentially exhausted the severance pay. On or about November 24, 2015, defendant filed a motion with the court to prospectively modify and reduce his support obligation, based upon a substantial change in circumstances. Meanwhile, defendant also earned a year-end performance bonus of $6,000, thereby bringing his annual compensation at his new employer to $82,000.

Defendant stressed that at $82,000, he had still suffered a loss of employment and a substantial decrease of approximately twenty-five percent of his prior salary which served as the baseline foundation for his court-ordered support. Conversely, plaintiff argued against a reduction in alimony, questioning the circumstances under which defendant lost his prior employment, and representing that a decrease in support would create economic difficulties for her in maintaining her present budget. Plaintiff essentially contended that defendant had an income potential of at least $108,000 and that he failed to sufficiently demonstrate that he could not continue to earn at least this level of income. Thus, the thrust of defendant’s position was that defendant was underemployed, and the court should impute defendant’s prior recent [83]*83income of at least $108,000 to him and keep his support obligation to plaintiff intact.

The matter proceeded to a contested hearing in which both parties had the opportunity to testify and present their positions. During the hearing, defendant credibly asserted that when he originally began working at his prior employment twelve years earlier, he was earning $50,000 per year. Over the course of a decade’s time as a valued employee, however, he gradually worked his way up the financial ladder in the same company, with his salary periodically increasing as well. Defendant explained that this commitment of time and effort was how he incrementally increased his prior income at his prior employment, a process that could not necessarily be automatically or easily duplicated by simply walking into a new position with a new company and immediately commanding the same salary. Further, defendant was an at-will employee at his prior position and was subject to termination at any time at the employer’s discretion. This was, in fact, how he lost his job, when the employer restructured and eliminated his position.

LEGAL ANALYSIS

Prior to the statutory amendments to New Jersey’s alimony statute on September 10, 2014, the law concerning circumstances when an obligor lost his or her W-2 employment and then obtained a significantly lower-paying position developed through case law. The disparity of factual scenarios and results in these cases, however, sometimes led to uncertainty and ambiguity in the realm of family court practice regarding the applicable standard for resolving the ultimate question of whether an obligor should, or should not, receive a reduction in support in such circumstances.

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Bluebook (online)
145 A.3d 1105, 447 N.J. Super. 78, 2016 N.J. Super. LEXIS 132, Counsel Stack Legal Research, https://law.counselstack.com/opinion/mills-v-mills-njsuperctappdiv-2016.