The National Pulse

‘Til Death Do Us Pay?

As retired boomers head to the golf course, courts look at limits on alimony

Posted Sep 1, 2008 7:05 AM CST
By Wendy N. Davis

Timothy Taylor
Photo by Christopher Navin

With 38 years of marriage, three grown children and a $900,000 home under their belts, the Long Island couple decided to divorce.

He was the breadwinner, earning between $100,000 and $300,000 as a car dealer. She had a high school diploma but hadn’t worked in years because of a host of medical conditions, including breast cancer and Epstein-Barr infection.

The 58-year-old ex-husband had expected to retire at age 65, but the divorce threw a wrinkle in his plans. If he retired, he wouldn’t have the money to pay his ex-wife’s maintenance. While the 57-year-old woman collected $692 a month in disability, that wasn’t enough to support her lifestyle.

Faced with the dilemma posed by this later-in-life divorce, state Supreme Court Judge Anthony J. Falanga of Nassau County came up with an unusual compromise. He ordered the ex-husband to pay maintenance of $3,000 a month for the next 10 years. With that order, he’ll be able to retire, albeit later than he wanted.

And the ex-wife? She “will have to engage in at least part-time employment through her 70th birthday,” Falanga wrote in J.S. v. J.S., issued in March.

The ruling, a case of first impression in New York state, attempts to cope with a growing problem: How to handle alimony when one ex-spouse is nearing retirement and facing the prospect of long-term support obligations.

Faced with the collapse of a long-standing marriage in which only one spouse was the breadwinner, most courts tend to order lifetime alimony, says Milwaukee attorney Gregg Mark Herman, immediate-past chair of the ABA Family Law Section.

That’s why the Long Island case is such an outlier. “Usually in long-term marriages, you’re going to see long-term support,” says Herman, “because at age 57 she’s not going to rehabilitate herself and go back to school.”

The problem for those in late middle age facing looming alimony payments is that many expect to retire at age 65. A lifetime alimony award could effectively mean that one spouse has to work well into old age. And the dilemma applies to those divorcing later as well as those already divorced who are looking to modify their payments.

SHIFTS IN LIFE EXPECTANCY

Falanga acknowledged the problem in his decision: “It is commonplace today for people to live well into their 80s and 90s. Courts must begin to acknowledge that an award of nondurational maintenance may require a payor spouse in his or her 90s and older to continue to support a dependent spouse in his or her 90s and older.”

In addition to the many factors judges consider in whether to grant nondurational alimony, Falanga added a new one: “the prospective financial circumstances and work life expectancy of the paying spouse.” Ignoring this, he wrote, would come “at the expense of enslaving the historic wage earner to indefinite years of employment beyond any reasonable expected retirement.”

While a first in New York, courts around the country are weighing the issue as divorced people near retirement. Many states liberalized divorce laws in the 1970s, only to find now that divorced baby boomers are leaving their offices for the golf course—and leaving judges to figure out what to do about alimony.

All states except Texas—which limits alimony awards to three years—provide for lifetime or indefinite alimony in some circumstances. In Florida, advocates unsuccessfully tried to get a constitutional amendment on the 2008 ballot that would have prohibited alimony altogether.

Of course, despite lifetime alimony awards, many judges expect that divorced people will one day retire. Typically, when the ex-spouse paying alimony is ready to stop working, he or she returns to court and asks the judge to reduce the support award in expectation of the lower earnings, Herman says.

Overall, judges have broad discretion when deciding whether to reduce alimony obligations. At the same time, many divorced wage earners don’t have the option of working into their 80s or 90s. In fact, some expect to retire before age 65, says Boston matrimonial lawyer David Lee.

“Some employment situations have built-in retirement ages, which are not traditional,” he says. “In the investment banking field, many people tell you it’s unusual to be 55, or older, and still in the field and generating the type of income that you do at young ages.”

Lee says current practices leave litigants uncertain. “Once alimony is set, if there’s no current knowledge of what the circumstances will be in the future, the judges need to be cautious about setting a definite termination point,” he says.

But, he adds, open-ended orders combined with vast discretion leave divorced people in limbo—even when the marriage itself wasn’t long-term. “There’s no standard set as to how it is that an obligor is relieved of the responsibility.”

REFASHIONING SUPPORT AWARDS

That ambiguity is spurring reform efforts. In Massachusetts, the state and Boston bar associations have created a joint task force to explore alimony awards, including what standards judges use to make decisions about modifying support awards. Lee, who is a co-chair, says the bar groups expect to issue a preliminary report this fall.

The effort was prompted by a 2007 state appellate court case, Greenberg v. Greenberg. A 65-year-old divorced man, Frederic Greenberg, sought to modify his $1,050 weekly payments because he was retiring from his job as an ophthalmologist. The trial judge granted his application and reduced payments to his wife, Suzanne, to $400 a week.

But the appellate court reversed, concluding “that the modification judgment will not permit Suzanne to meet her needs (as measured by the parties’ marital standard of living), and ... Frederic is able to meet his support obligations (established at the time of the last modification judgment) without diminishing his capital assets or affecting his ability to maintain his standard of living.”

The court said that his investments alone afforded enough income to continue the alimony payments; the simple fact of his retirement wasn’t sufficient to justify relief.

MASSACHUSETTS CONSIDERS CAP

Meanwhile, a bill before the Massachusetts legislature would cap alimony duration at half the length of the marriage or 12 years, whichever is less. The measure, Bill No. 1567, presented by former Massachusetts House member Stephen P. LeDuc (who resigned in February), would also provide cost-of-living increases if the supporting party’s income rises.

The bill’s author, attorney Timothy Taylor of Lincoln, Mass., contends that alimony is largely harmful because it promotes financial dependence and adds to the bitterness of most divorces.

“There are situations where the supported party is really incapable of being self-sufficient,” Taylor says, “and alimony serves a purpose there.”

But Taylor, himself divorced, believes there should always be a cut-off date. “You can’t perpetuate this financial connection decade after decade,” he says. “It’s time to say, ‘Payor, you’re at last off the hook.’ ”

Adds Taylor: “What most of the public probably thinks is that alimony serves some sort of beneficial purpose. But it’s become more the rule as opposed to the exception, and it should be the exception.”

The bill was referred for further study and is expected to be reintroduced next year, Taylor says.

In J.S., the Long Island case, the judge didn’t want to put the burden of returning to court and filing future motions on the ex-husband. So to forestall that possibility, he issued an order with a built-in cut-off date in 10 years. The wife’s lawyer, Jay Davis of Davis & Altarac in Garden City, N.Y., says the decision was fair, but that he’s still planning to appeal.

He chalked up the result to the judge’s view that “a man shouldn’t be stuck having to pay that money when he’s 75, 80 years old.”

“The theory is right,” Davis says. “I just wish it hadn’t applied to my client.”

Comments

David
Aug 27, 2008 12:50 PM CST

Marriage under current laws is an all-downside / no-upside proposition if you are the higher earning spouse. It is a system where the less you put into it during the marriage, the more you get out of it afterward. Under the same ground-rules Communism only lasted 60 years before collapsing. It has now been 30 years since no-fault reforms. Let’s see where the institution of marriage stands in another 30 years.

Divorce is a magical occurence where obligations that didn’t exist even during the marriage itself suddenly appear.

When a married bread-winner loses his job at the car plant both he and his dependent spouse are out of luck. There are no courts to give contempt orders to anyone to fix the problem. When a divorced man loses his job at the same car plant, it is not the recipient ex-dependent spouse’s problem. There are explicit government guarantees that kick in. No wonder so many people are chosing divorce over staying married. Being divorced is so much more adventagous. You are guaranteed a revenue stream, where your old married-self had no such guarantees. Amazing.

In an age when people divorce at the drop of a hat and where 70% of divorces are filed by the lesser-earning spouse, such laws are nothing but barbaric.

The National Pulse

‘Til Death Do Us Pay?

SHIFTS IN LIFE EXPECTANCY

REFASHIONING SUPPORT AWARDS

MASSACHUSETTS CONSIDERS CAP

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