Divorce FAQ's

Reducing Alimony Based on Loss of Employment or Reduced Earnings

1. I have recently lost my job making a six-figure job on Wall Street. I am now working as a sales rep for a local New Jersey company, and I now only earn $60,000 per year. What are my chances to reduce my $300 per week alimony award if I file a motion to reduce alimony?

The family court will carefully scrutinize your application to reduce or modify alimony based upon your reduced earnings. The reason for this is that merely because a payor has suffered a setback in their economic circumstances does not necessarily equate to a legitimate Lepis change of circumstances. However, if you have legitimately lost your job in good faith then you have a “fighting” chance to obtain some relief. In my experience many judges are only granting a reduction of alimony on a temporary basis. Many judges will only reduce alimony for a six- month to a one year period. Thereafter, many judges will insert into any court order that reduces alimony that “the issue of alimony shall be reviewed upon application by the payee spouse after a six- month to one year period.”

2. What are some recent caselaw that addresses motion to reduce alimony based on the payor’s reduced earnings?

A. Kuron v. Hamilton, 331 N.J. Super 561 (App. Div. 2000). Here, the defendant who was a former attorney was disbarred for stealing his client’s money. He was then sent to jail for nine years. While he was in jail he filed a motion to reduce his alimony. The family court judge denied this motion. Thereafter, he appealed the denial of his motion to reduce his alimony payments. The grounds on appeal was that; a) his loss of his law license with his loss of income were sufficiently changed circumstances to allow the reduction of his alimony; b) because his jail term has left him with no source of income adequate to meet his alimony payments, he was entitled to a suspension of his alimony payments without the accrual of arrears while he was in jail.

The wife argued that; 1) because the defendant’s disbarment and imprisonment resulted from voluntary acts, they are inadequate bases for reducing or suspending alimony and 2) the trial court erred in its determining that the defendant lacked the then current ability to discharge those obligations.

On appeal, the court reversed the trial court’s denial of the motion to reduce alimony. The Kuron court further held that:

It may seem counter-intuitive to permit a support obligor to avoid his or her payment responsibility, even partially or temporarily, based upon the consequences of his or her voluntary acts. However, the process of assessing and enforcing family obligation is not an exercise in intuition rather, it calls for an evaluation and application of all the equitable considerations that emanate from the parties’ relationships, understandings and circumstances at every significant junction. Id. at 576.

B. Miller v. Miller, 160, N.J. 408 (1999). Here, the Appellate Division affirmed the trial court’s determination that the payor spouse had demonstrated a significant change of circumstance after he lost his job at Merrill Lynch.

C. Storey v. Storey, 373 N.J. Super. 464 (App. Div. 2004). Here, the Appellate Division held that in or order to obtain a reduction of alimony based on current earnings, a payor who selects a new, less lucrative career must establish that the benefits he or she derives from the career change substantially outweigh the disadvantages to the supported spouse. Absent that showing, the judge should deny the motion, and impute income based on prior earnings. However, the payor can still try to prove that his capacity to earn is diminished. Thereafter, the judge should then try to impute earnings consistent with the obligor’s capacity to earn in light of this background and experience. The payor always has the burden of proof.

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