ELAINE J. BARTON v. RICHARD BARTONAnnotate this Case
NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
SUPERIOR COURT OF NEW JERSEY
DOCKET NO. A-6132-10T3
ELAINE J. BARTON,
May 24, 2012
Argued April 16, 2012 - Decided
Before Judges Grall and Alvarez.
On appeal from Superior Court of New
Jersey, Chancery Division, Family
Part, Gloucester County, Docket No.
Ted M. Rosenberg argued the cause for
Karen Amacker argued the cause for
This is an appeal and cross-appeal from post-judgment orders concerning alimony and the obligation to secure it. The judge reduced defendant Richard Barton's alimony obligation from $800 to $550 per week and modified his obligation to secure alimony payment with a $400,000 life insurance policy by providing a lien against his estate in that amount, which defendant could reduce by $20,000 annually. Defendant contends that the court should have terminated these obligations, and plaintiff Elaine J. Barton contends that the court should have denied all relief and granted her request for counsel fees. We affirm.
The Bartons married in 1966, and they have two children who had both reached the age of majority when the parties separated in 1993. They divorced in 1996, and are now both about seventy years old.
The final judgment incorporates the Bartons' agreement on equitable distribution, but the question of alimony was tried to the court. At that time, the court found that plaintiff could earn between $15,000 and $20,000 per year and that defendant earned $125,000. The judge required defendant to pay $800 weekly alimony and maintain a $400,000 life insurance policy naming plaintiff as the beneficiary, noting that defendant could move for modification of the amount after five years.
Defendant is a lawyer, and throughout his career he specialized in workers' compensation defense. At the time of the divorce, defendant was a partner in a law firm, a position he held until he became an employee of the firm in 2008. Defendant earned $125,000 a year from 2008 until January 2011, according to a letter from the firm addressed to defendant. During the first half of 2011, defendant's salary was $2000 per week, and for the second half of that year it was $1000 per week. In addition to salary, the firm paid for defendant's car insurance and lease and his medical insurance. The letter also states that defendant's employment with the firm would terminate as of January 1, 2012, a date about two months after defendant's sixty-ninth birthday.
Defendant was sixty-eight when he filed his motion to terminate or reduce his alimony obligation and eliminate his obligation to maintain a $400,000 life insurance policy. For over a year, he had been seeing a psychiatrist, who had advised him to discontinue his trial practice due to his panic attacks. In his doctor's opinion, defendant's prognosis was "guarded due to continuous work related stress." Defendant also presented a report from a vocational expert. In his opinion, defendant's age, specialized experience and present condition were "overwhelming" obstacles to his finding "alternative work activity as an attorney" and the probability of defendant's obtaining such work was "statistically inconsequential."
With his motion, defendant also provided information in support of his request to terminate life insurance for plaintiff's benefit. He had received notice from the insurer indicating that the cost would be raised from $2500 to $25,719 annually and invited him to consider alternatives.
After leaving the firm, defendant's monthly income was $2806 a $1850 social security benefit, a $876 monthly mortgage payment from his former firm, and $80 interest. He had assets worth about $1,651,0001 a $200,000 home, a $4000 car, a $70,000 airplane, $272,000 in bank accounts, $720,000 in retirement accounts, and $385,000 in an investment account. He also had a stockholder interest in his former law firm with a value that had not been determined, but he anticipated receiving $240,000 if the firm could afford to pay him.
Defendant reported a monthly budget of $7069, $84,828 annually. It includes the following: $2205 for housing, $1174 for transportation and $3690 for personal expenses, which includes $400 for restaurants, $400 for vacations, $800 for sports and hobbies and $100 for additional savings. It does not include alimony payments or income taxes. At that rate of spending, defendant's expenses would exceed his gross income by about $92,756 annually with a $800 weekly alimony obligation and by about $51,156 without any alimony obligation.
Plaintiff was sixty-nine years old when she responded to defendant's motion. She too had left the workforce. She had earned about $13,000 annually working part-time until 2008, when her employer laid her off. Her monthly social security benefit was $830, and her health did not permit her to work. She listed assets with a total value of $806,500: a $245,000 home, a car worth $17,500, $17,000 in bank accounts, $170,000 in various IRAs, and retirement accounts worth $357,000. She reported a monthly budget of $5397, $64,764 per year. The budget includes $1952 for shelter, $262 for transportation, and $3183 for personal expenses, which includes $400 for vacations and $550 for gifts.
It is worth noting that plaintiff would not have been able to fund the annual budget she reported, $64,764, prior to her retirement with her gross annual income of $54,600 $13,000 from wages and $41,600 from weekly alimony of $800. After her retirement, her reported budget exceededherannualgrossincome $800weeklyalimonyand$830monthlysocialsecuritybenefits byabout$13,204peryear. With$550weeklyalimony,plaintiff's budgetexceedsherincomebyabout$26,204peryear. Withnoincomeotherthanhersocialsecuritybenefit,thedifferencebetweenherincomeandbudgetwouldbeabout$54,804.
Defendant provided the judge with an analysis of his ability to support himself and pay alimony prepared by a financial planner. The planner projected that defendant had sufficient savings to support himself until he reached 92, but he would exhaust his savings by age 83 if he continued to pay $800 alimony per week. The analysis does not account for contingencies such as long-term illness, and it is based on a value of his investment accounts as of May 18, 2011, which was less than the value of his accounts when the motion was decided and did not include the payment from his law firm.
The judge set forth his factual findings and reasons for denying defendant's request to terminate alimony and reducing alimony to $550. He explained:
[T]heDefendant'sobligationtopayhispermanentalimonyobligationtothePlaintiffisnotterminated,astheDefendanthasnotshownthathischangeinemploymentcircumstanceshassubstantiallyimpairedhisabilitytosupporthimself.... [T]heDefendanthassignificantassetsthathehasprovidedproofsoftotheCourt-severalofwhichareliquid-includingabankaccountholding$272,000.00,anAircraftworth$70,000.00,aSchwabaccountworth$385,000.00,andapensioncurrentlyat$705,000.00. Eventhoughhisemploymentwillterminateattheendof2011,theDefendanthasfurthercertifiedthatitislikelyhewillreceiveanadditionalpartnershipbuyoutintheamountofapproximately$240,000.... Inaddition,theDefendanthasfailedtoconsiderthatthePlaintiffreliesonherreceiptofalimonyeachweek,andforthepastsixteen(16)years,shehaslivedwiththeassistanceofthosepayments.
[T]heDefendanthasbeenemployedforanumberofyears,andhehasmadeallalimonypaymentstothePlaintiffontimeandingoodfaith. Atnearlyseventy(70)yearsold,theDefendantisseekingtoretireatappropriateage. Uponhisretirement,therewillcertainlybeachangeincircumstancesinthathewillnotbeearningtheincomethatheoncedidasaseniorpartnerinalawfirm. ThePlaintiffhascertifiedthatsheispresentlyillandsufferingfromphysicalmaladies. Despiteherrecentillness,however,shehasnotexplainedwhyshehasnotattemptedtoworkfull-timesincethedivorcein1996,norwhyshehasnotappliedfordisabilitybenefitstosupplementherincomeifshecannotwork. PlaintiffalsohassomesubstantialassetsthatarenotfullyaddressedinhercertificationsbutaredetailedinherCaseInformationStatement,includingherbankaccountsandPensionfunds(totalingapproximately$500,000.00)andherCitigroupAccountresultingfromequitabledistributionintheamountof$320,000.00.
The judge elaborated, explaining that reduction rather than elimination of alimony was appropriate because of the difference between the parties' respective holdings, defendant's larger social security benefit and the anticipated payment from his former law firm. The judge did not, however, explain why he fixed alimony at $550 weekly. It appears that the court fixed the amount, assuming as defendant's financial analyst had, that savings would be invaded to fund post-retirement life and that defendant had more to invade than plaintiff. It is not clear whether the judge considered the role assets divided by way of equitable distribution had played in setting the reduced alimony amount. See Steneken v.Steneken, 183 N.J. 290, 303 (2005) (recognizing the relationship in the context of an initial alimony award); seealso N.J.S.A. 2A:34-23b.
Wefullyagreewiththetrialcourt'sdeterminationthatdefendantestablishedaprimafaciecaseformodificationofalimonybasedonhisretirement. Wehaveheld"thatapartywhoretiresingoodfaithatagesixty-fiveisentitledtoahearingonwhetherthereissucharesultantchangeincircumstancesthatalimonyobligationsshouldbemodified." Silvanv.Sylvan,267N.J.Super.578,582(App.Div.1993). Defendant'sretirementatagesixty-eight,whethervoluntaryorinvoluntary,hardlysuggestsbadfaith;healsoassertedthathisdecisionwasinfluencedbyhisdiminishedabilitytodealwiththestressoflitigation,indicatingthathisdecisionwasnotentirelyvoluntary. Similarly,plaintiffcannotbefaultedforleavingtheworkforce. InSilvan,thetrialjudgedeniedthepayor'smotionformodificationonthegroundthathis"retirementwasforeseeablewhenthepartiesdivorced...." Ibid. Concludingthattheforeseeabilityofretirementdidnotendtheinquiry,ibid.,thepanelprovidedguidance,whichwesetforthaspertinenttotheevidencepresentedonthemotioninthiscase:
There are a variety of factors which should be considered in analyzing whether such changed circumstances do, in fact, exist as would justify a modification of alimony. A court may consider, for instance, . . . whether at the time of the initial alimony award any attention was given by the parties to the possibility of future retirement; . . . whether the particular retirement occurred earlier than might have been anticipated at the time alimony was awarded; and the financial impact of that retirement upon the respective financial positions of the parties. . . . . A court may also wish to consider the degree of control retained by the parties over the disbursement of their retirement income, e.g., the ability to defer receipt of some or all.
[Id. at 581.]
Although the judge did not explain why he fixed alimony at $550 weekly, that amount accommodates reasonable expectations and the realities. This is not a case in which the parties have agreed that alimony will terminate at a reasonable retirement date. See Gordonv. Rozenwald, 380 N.J. Super. 55 (App. Div. 2005). Nothing in this record permits an inference that the Bartons' agreement on division of marital assets was fashioned to address termination of alimony on retirement. The Bartons were unable to reach any agreement on alimony, and the trial court decided the amount of permanent alimony at the time of their divorce. That judge's determination made at the time of divorce must be viewed as contemplating modification based on changed circumstances in accordance with Lepis v.Lepis, 83 N.J. 139 (1980).
From the judge's decision in this case, it is clear that he considered the pertinent factors in determining that modification of alimony, rather than termination or continuation, was appropriate. We agree.2
While the judge did not explain how he selected the $550 amount, it is not arbitrary. It requires the Bartons to look to their respective savings, which is what couples of retirement age generally expect to do to fund a standard that is reasonably comparable to the marital standard of living with appropriate adjustments. Steneken, supra, 183 N.J. at 298-99 (citing Crews v.Crews, 164 N.J. 11, 16-17 (2000)). Resolutionofthisdisputecalledforanexerciseofsoundjudicialdiscretioninlightoftherealitiesofthecircumstancesthatconfrontedthepartiesastheyreachedretirementage. Labrigv.Labrig,384N.J.Super.17,21(App.Div.2006). Thiscourtrecognizesthewidediscretiontrialjudgeshaveinaddressingsuchapplicationsandreviewsthemonlyforabuseofdiscretionorarbitrariness. Ibid. Afterconsideringtheargumentspresentedonappealinlightoftherecord,wefindnoreasontodisturbthisdetermination.
Weturntoconsidertheparties'objectionstothejudge'srulingonlifeinsurance. Thejudgeinitiallydenieddefendant'srequesttoterminatehislifeinsuranceobligationwithoutprejudice,anddefendantfiledasecondmotionandplaintifffiledacross-motionrequestingthejudgetoimposeatrustforthefullamount. Thecourtreevaluatedtheissueandconcludedthatdefendantshouldbepermittedtosecuretheobligationwitha$400,000lienagainsthisestate,whichwouldbereducedattherateof$20,000annually. Indoingso,thejudgeconsideredplaintiff'slifeexpectancy. Again,wefindnoabuseofdiscretion.
Plaintiff'sobjectiontothecourt'srulingoncounselfeeslackssufficientmerittowarrantdiscussioninawrittenopinion. R.2:11-3(e)(1)(E). Thereisnodistinctiononthereasonableness ofthepositionsthepartiesasserted,andbothhavethemeanstopaythefeesincurredonthesemotions.
1 Defendant's CIS lists his assets as $1,686,000 because he includes the $35,000 mortgage payment. We have included that figure with his income and have omitted it here.
2 We illustrate the inequity of the plaintiff's position that alimony should continue at the present rate and of defendant's position that there should be no alimony. The illustrations are not offered to suggest an approach to the problem, but to demonstrate the difficulties with the approaches the parties have taken.
According to Appendix I of the Current Rules of Court, the parties both have a life expectancy of 15.3 years. Assuming no increase in the value of the parties' respective accounts and equal annual withdrawals by each to fund their retirement during that period with nothing left, plaintiff could withdraw about $35,000 a year from her holdings for 15.3 years, and defendant could withdraw about $90,000 from his during the same period. Plaintiff's position, maintaining current alimony, would result in a $41,600 annual adjustment, leaving plaintiff with $76,600 and defendant with $48,000. With social security income considered, plaintiff would have about $86,560 and defendant would have about $72,000 each year for 15.3 years, and neither would have anything but social security after 15.3 years.
In contrast, defendant's request to terminate alimony would leave plaintiff with an annual gross income of $44,960 if she withdrew $35,000 of her savings every year for 15.3 years and spent all of her $9960 annual social security benefit. Assuming the budget she detailed in her CIS is reasonable, she needs $64,764 a year.