What Constitutes a Change in Circumstances: Alimony & Child Support?
By Snyder Sarno D'Aniello Maceri & da Costa LLC on December 11, 2018
Zangrilli v. Zangrilli, 2018 N.J. Super. Unpub. LEXIS 2508
Modifying Alimony and Child Support in New Jersey: What Constitutes a Change in Circumstances?
In New Jersey, marital agreements governing support obligations such as alimony and child support are enforceable to the extent that they are fair and equitable. The Family Part is given considerable deference in modifying or terminating such obligations based upon a prima facie showing of changed circumstances. New Jersey law recognizes a permanent and unanticipated reduction of income as a substantial change of circumstances, however, each case is still unique and a court’s determination will always depend on the facts. The Appellate Division recently addressed an appeal involving an alleged change of circumstances, and illustrated when a plenary hearing is necessary to determine the obligor’s ability to pay and whether his or her alleged change of circumstances is sufficient.
In Zangrilli v. Zangrilli, the ex-husband (Defendant) appealed from two separate orders denying his motions to modify alimony based on alleged changed circumstances and establishing his child support using income set forth in the parties’ property settlement agreement (PSA).
The parties had three children born in years 1999, 2003, and 2005. Throughout the marriage, Defendant was a creative director in advertising with fluctuating income between $157,000 and $285,000 annually. He was terminated in December 2011, but continued doing freelance work and ran his own consulting business. The ex-wife (Plaintiff) was unemployed throughout most of the marriage and obtained a job in 2012 earning $44,000 annually.
The parties’ PSA imputed income of $40,000 to Plaintiff, and $150,000 to Defendant, for purposes of computing alimony and child support. The PSA further provided that if Defendant obtained employment earning less than $150,000 his income would remain imputed at $150,000 for alimony purposes, but if he obtained employment earning more than $150,000, his alimony obligation would be modified.
Defendant agreed to pay Plaintiff limited duration alimony in the amount of $705 per week for 15 years. He also agreed to pay child support in the amount of $338 weekly until the children’s emancipation. The parties mutually agreed that either could seek to modify the alimony provisions upon a substantial change in circumstances pursuant to the seminal New Jersey case, Lepis v. Lepis.
In October 2013, Defendant mounted substantial arrears of almost $20,000 and soon after lost his job. He sought a downward modification of his support obligations based on a reduced income and the emancipation of their oldest child. He argued that he was not able to find a comparable job because the field of advertising was undergoing changes, including outsourcing and robotics, and that the field ages people out at 47 years old.
Defendant obtained a job as a truck driver in October 2017. In his motion, he argued that the line of work provided more stability and required less training than advertising. He explained his financial picture and efforts to find reasonably comparable employment. He also retained an expert who prepared a “vocational evaluation and earning capacity assessment.” Defendant certified that he applied to over 600 jobs between January and June 2017, and that he had operated a consulting business on the side to make ends meet. He provided evidence of networking events, seminars, and continuing educational opportunities that he had attended prior to switching careers.
Defendant’s estimated income as a truck driver, determined by mileage, is between $54,000 and $66,000 annually. Despite the provision in the PSA, he requested that his income be imputed at $60,000 for purposes of calculating his support obligations. He also provided tax returns from 2012 to 2016 and certified that he filed for bankruptcy. He depleted his savings account and started living with family members. He had less than $1,000 in his bank account and almost 30 times as much credit card debt. He also emptied retirement accounts, savings, and stocks in order to meet his obligations.
Defendant’s expert opined that his transition to a completely unrelated field was due to technological changes in the advertising industry and limited employment opportunities. The expert concluded his report by recommending that Defendant continue working as a truck driver.
The court did not accept Defendant’s arguments, or the conclusions of his expert, and denied his motion to reduce his alimony obligation based on substantial change of circumstances. It found that Defendant failed to make a prima facie showing of changed circumstances under Lepis. Specifically, the court found that, despite his efforts to secure employment, he does not provide proof of efforts to find a job when his financial hardships initially began, nor did he provide proof of continued search efforts up until the time he filed the motion. Essentially, the court said that he gave up and did not provide proof that he was impaired or unable to continue his efforts. Moreover, the court found that, while Defendant submitted proofs that he applied for jobs within the area of a “creative director,” he did not apply to jobs with “similar work arising out of the same experience of skill set.” However, the court did grant Defendant’s request to reduce child support based on the emancipation of the parties’ oldest child and established annual income of $150,000 as stipulated in their PSA.
On Defendant’s appeal, the Appellate Division reversed the court and held that a plenary hearing was required under the facts of this case. The Appellate Division reiterated the Lepis analysis as two-fold: (1) the moving party holds the burden of making a prima facie showing of changed circumstances; and (2) if a prima facie showing is made and there is a genuine dispute of material fact (i.e. facts that turn on the case), the court should order discovery and a plenary hearing to discern whether the obligor has the ability to pay. The income and assets are the most important factors in assessing ability to pay. Moreover, courts have the ability to modify support orders even where there is a PSA in place fully addressing issues of support. Pertinently, a decrease in the obligor’s income can constitute a change of circumstances warranting a modification of support obligations.
The Appellate Division found that Defendant sufficiently made a prima facie showing of a “significant good-faith reduction of income” and that his assets were almost entirely liquidated. It held that a plenary hearing was warranted to determine whether Defendant made sufficient efforts to seek alternate employment with a reasonably comparable income.
During the plenary hearing, stated the Appellate Division, the court may, if it deems appropriate, determine the intent of the parties at the time they entered the PSA to see whether they contemplated a reduction of income as an event that would trigger a modification of the support obligation. Here, the Appellate Division found that a waiver of Lepis was unlikely.
If you have any questions regarding modification of alimony or child support, please contact the skilled matrimonial attorneys at Snyder Sarno D’Aniello Maceri & da Costa LLC. Call us today at (973) 274-5200.
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