Thursday, August 09, 2012
In New Jersey, deciding when to cap income when determining alimony is left up to the courts and is decided on a case-by-case basis. In a 2011 New Jersey case, Dudas v. Dudas, 423 N.J.Super. 69, Wife filed a Complaint for Divorce after twenty-six years of marriage. After Wife filed the Complaint, Husband’s income increased drastically by more than $12,000.00 a year–about a 15% increase over the previous year. Wife argued that Husband’s post-Complaint income should be considered in the alimony analysis; whereas, Husband argued that alimony should be based only on the income he earned prior to the filing of the Complaint.
Under the alimony statute in New Jersey, N.J.S.A. 2A:34-23(b), judges are instructed to consider numerous factors when determining alimony. In the above case, the judge looked at the following factors:
• the actual need and ability to pay;
• the standard of living established during the marriage;
• the earning capacities of the parties; and
• the marginal cost estimation and momentum of the marriage.
“Marginal cost estimation” focuses on the extra cost of supporting an additional person in a family unit. “Momentum of marriage” recognizes that a spouse who maintains the home while the other party’s career advances should share in the rewards of their combined efforts.
When one household separates into two, there is less money for both houses; therefore, additional funds earned post-Complaint are relevant for determining alimony because those earnings are a viable source to help both parties achieve the financial lifestyle they had while they were married. Marginal cost estimation “does not mean that the supporting spouse has to finance the lifestyle of a supported spouse at a level substantially greater then the marital lifestyle.” Now that Husband is earning more money, there is, naturally, more money available to bring the parties closer to marital status quo.
With respect to “momentum of the marriage,” the judge held that it was a relevant factor, because it recognizes that a spouse who maintains the home while the other spouse’s career advances should share in the rewards of their combined efforts. Courts will “not sanction an agreement which prohibits a woman devoted to her husband from enjoying the fruits of her labor just as they are to be reaped.” It is unfair and inequitable to ignore one spouse’s lifetime contribution towards the other spouse’s present-day earning potential.
The judge said that the Legislature of New Jersey could not have intended for an alimony analysis to be capped at the level of income earned during the marriage. Further, the judge reasoned that a consideration of the earning capacities of the parties “inherently includes consideration of one’s earning potential even beyond that actually earned during the marriage.”
Therefore, in New Jersey, an alimony award may be based on income earned after the date that a divorce complaint is filed; however, it will depend on the facts and circumstances of the specific case. If you have questions about your right to alimony, your potential alimony obligation or alimony payments you may already be paying or receiving, you should contact an attorney.
Written by Allyson Lutley, law clerk at The Law Offices of Linda A. Kerns, LLC. Edited by Elizabeth A. Bokermann, Esquire.