An Article by:
Janine Danks Fox, Esq.

In September of 2014,  N.J.S.A. § 2A:34-23 was amended to clarify the standard that New Jersey Courts must rely upon to terminate or modify alimony upon a prospective or actual retirement.  Subsection (j) of the statute delineates different standards, identified as j(1), j(2) and j(3), each of which apply to different scenarios.  The Statute has no retroactive effect. Thus, depending upon the specific terms of the Marital Settlement Agreement and/or the date of the Marital Settlement Agreement, that date controls whether the amended statute applies or the agreement applies. The following is a brief summary of each standard:

j(1)  Application upon reaching full retirement age for Agreements Reached After September 10, 2014

Upon reaching full retirement age, there is a rebuttable presumption that alimony shall terminate.  The supported spouse has the burden of rebutting the presumption to convince the Court that alimony shall continue at some level, albeit possibly at a lesser sum.   In this instance, a Court shall evaluate the following factors to determine if the supported spouse has rebutted the presumption and shown good cause for alimony to continue:

  • The ages of the parties at the time of the application for retirement;
  • The ages of the parties at the time of the marriage or civil union and their ages at the time of entry of the alimony award;
  • The degree and duration of the economic dependency of the recipient upon the obligor during the marriage or civil union;
  • Whether the recipient has foregone, relinquished or otherwise sacrificed claims, rights or property in exchange for a more substantial or longer alimony award;
  • The duration or amount of alimony already paid;
  • The health of the parties at the time of the retirement application;
  • Assets of the parties at the time of the retirement application;
  • Whether the supported spouse has reached full retirement age as defined in this section;
  • Sources of income, both earned and unearned, of the parties [1];
  • The ability of the recipient to have saved adequately for retirement;
  • And any other factors that the court may deem relevant.

If the court determines that the presumption has been overcome, the Court is required to conduct a needs based analysis of the supported spouse and the obligor’s ability to continue to pay alimony.  In order to evaluate the parties’ respective financial circumstances, the Court must review both parties’ updated Case Information Statements.

The obligor may also file for a determination under this provision based upon a prospective retirement. This provision allows the obligor to plan ahead and address the impact of his retirement and loss of earned income upon his ability to pay alimony and also serves to prevent an obligor from having to pay an ongoing support obligation beyond the date of retirement.

j(2) Application to Retire Prior to Reaching Full Retirement Age.

In the event the obligor pursues an early retirement prior to reaching full retirement age, there is no longer a rebuttable presumption in the obligor’s favor. It is the obligor’s burden to prove by a preponderance of the evidence that he has met the majority of the statutory factors. First, the obligor must establish that the actual retirement, albeit early, is reasonable and made in good faith.  In evaluating an early retirement application, the court shall consider specific factors including but not limited to the age and health of the parties, employment field and accepted age of retirement, motives of retirement, expectations of the parties regarding retirement, the ability of the obligor to maintain support payments following retirement, the obligee’s level of financial independence and impact of the obligor’s retirement upon the obligee.

j(3) Application upon reaching full retirement age for Agreements Reached Prior to September 10, 2014

When a retirement application is filed in cases in which there is an existing final alimony order or enforceable written agreement established prior to the effective date of the statute (9.10.14), the obligor’s reaching full retirement age [2] shall be deemed a good faith retirement age. In making its’ determination, the court shall consider the ability of the obligee to have saved adequately for retirement as well as the factors delineated in j(2) in order to determine whether the obligor, by a preponderance of the evidence, has demonstrated that modification or termination of alimony is appropriate.

Following the amendment to the statute, decisional law clarified these standards and the proper application depending upon the circumstances presented to the Court. The case of Landers v. Landers, 444 N.J. Super. 315 (App. Div. 2016) is instructive. The Appellate Court underscored that the burden of proof being placed on the obligor or obligee is dependent upon whether the marital settlement agreement was entered prior to or after the effective date of the statute. Additionally, it is dependent upon whether the retiree has reached full retirement age or is seeking an early retirement.

Regardless of the above standards, a retirement, whether it is a good faith early retirement or a full retirement, permits an obligor the right to seek a review of alimony based upon  the financial impact the retirement has on his or her  ability to pay alimony prospectively. Each individual’s employment and financial circumstances vary and certain factors delineated above may be more relevant to a Court than other factors.  The Court must make findings of fact and conclusions of law after considering the above applicable standards prior to making any determination to alter an alimony award.

If you are approaching retirement age, it is in your interest to consult with an attorney to address your specific circumstances and the impact such circumstances will have on your future obligations to pay alimony.

[1] This is defined by an obligor’s date of birth pursuant to the social security guidelines For example, if an obligor is born between 1943 and 1959, the full retirement age will occur at some time frame during their 66th year. Anyone born after January 1, 1960, has a full retirement age of 67.

[2] In evaluating this factor, the obligor’s assets received in equitable distribution can not be considered when determining the obligor’s ability to pay alimony following retirement.