Alimony

1
Alimony
2
Relationship between Property and Alimony

• So interrelated that the are referred to and
  being two sides of the same coin
• What happens in one area will inevitably impact
  the other
• In Florida, start with property, then move to
  alimony. Most states follow that rule, but
  perhaps less rigidly.

3
Award of alimony

• Authorized by statute in every state
• Some states limit the type of alimony that can be
  awarded or the circumstances under which it can
  be awarded
• Also referred to as spousal support or
  maintenance

4
Types of alimony

• Rehabilitative
• Permanent
• Reimbursement (more like a property award, some
  states call this alimony in gross)
• Awarded to compensate for a property interest
  that cannot be readily divided, such as an
  advanced degree
• In FL, Bridge the Gap and Lump Sum Support
  alimony

5
Purpose of alimony

• Needs/Ability to Pay Meet needs of dependent
  spouse within the other spouses ability to pay
• Standard of Living Award should go beyond bare
  subsistence level of support to permit dependent
  spouse to have a standard of living similar to
  the years immediately preceding the divorce.

6
Considerations

• Dependent spouse should not be required to
  liquidate property to support self
• If there is inadequate income to maintain the two
  post-divorce households and the pre-divorce
  standard of living, each party must share in the
  reduced living standard

7
Paradigm Case for Alimony

• Long-term marriage (25 years )
• Recipient out of work force or with minimal
  earnings
• Recipient age 50 or greater
• Adequate income for payor spouse to support two
  households

8
Result in Paradigm case

• Equal division of post-divorce income, work
  backward from there as facts depart from the
  paradigm
• Equal division is rare in real world, even in
  strong cases, due to what is sometimes called the
  mailbox postulate it is much harder to earn
  the income than to walk to the mailbox and pick
  up your check
• - Larocque (Casebook)

9
Some states have threshold findings for alimony
eligibility

• Inadequate property for the support of the
  dependent spouse
• Inability to support self through appropriate
  employment
• Need to refrain from full-time work based on
  childrearing responsibilities

10
Alimony in Florida

• Rehabilitative
• Permanent
• Bridge-the-Gap or Transitional
• Lump-sum support alimony

11
Rehabilitative Alimony in FL

• The principal purpose of rehabilitative alimony
  is to establish the capacity for self support of
  the receiving spouse, either through the
  redevelopment of previous skills or through the
  provision of the training necessary to develop
  potential supportive skills. Canakaris v.
  Canakaris, 382 So. 2d 1197 (Fla. 1980)

12
Factors to consider in rehabilitative award

• Earning ability of payor spouse.
• Feasibility of training payee spouse.
• Post-training capacity for self support in
  marital standard of living (if long term
  marriage).

13
When rehabilitative vs permanent alimony?

• Rehabilitative alimony is appropriate only where
  a spouse is able to gain the capacity for
  self-support within a finite period of time.
  Forster v. Forster, 436 So. 2d. 966 (Fla. 3d DCA
  1983)
• Bible v. Bible, 597 So. 2d 359 (Fla. 3d DCA
  1992) 5 years rehabilitative not adequate after
  25 year marriage.

14
Examples of rehabilitative alimony cases

• Rehabilitative alimony is appropriate where a
  spouse has lost career opportunities during the
  marriage and requires time and money to
  reestablish career path. Kanouse v. Kanouse, 549
  So. 2d 1035 (Fla. 4th DCA 1989)
• Rehabilitative alimony is appropriate where the
  parties agreed that one of them would stay at
  home and care for the children. Green v. Green,
  672 So.2d 49 (Fla. 4th DCA 1996)

15
Required Findings

• The court must make specific findings of a
  rehabilitative plan and a termination date in
  order to support an award of rehabilitative
  alimony. Zelahi v. Zelahi, 646 So. 2d 278 (Fla.
  2d DCA 1994) Roth v. Roth, 615 So. 2d 868 (Fla.
  4th DCA 1993).

16
Permanent Alimony in FL

• The purpose of permanent alimony is to provide
  for the needs and necessities of life for a
  former spouse as they were established during the
  marriage of the parties.
• Permanent alimony is appropriate where the income
  of the spouse seeking alimony cannot support that
  spouse with the lifestyle established during the
  marriage. Webb v. Webb, 659 So. 2d 336 (Fla. 1st
  DCA 1995)

17
Factors to Consider

• The criteria to be used in establishing this need
  include the parties
• Earning ability
• Age
• Health
• Education
• Duration of the marriage
• Standard of living during the marriage
• Value of the parties' estates
• - Canakaris v. Canakaris, 382 So. 2d 1197 (Fla.
  1980)

18
Permanent Alimony in Short Term Marriages

• Short term marriages (generally less than ten
  years) Permanent alimony is usually
  inappropriate unless a genuine inequity is
  created by the dissolution.
• There is a rebuttable presumption against
  permanent alimony in short term marriages.

19
Examples

• Income disparity not attributable to the marriage
  is not a factor to be considered in a short term
  marriage. Murray v. Murray, 598 So. 2d 310 (Fla.
  2d DCA 1992) Cornell v. Smith, 616 So. 2d 629
  (Fla. 4th DCA 1993)
• Where a great inequity has been caused by the
  dissolution, permanent alimony may be awarded in
  a short term marriage. Driscoll v. Driscoll, 547
  So. 2d 1247 (Fla. 4th DCA 1989) Simzer v.
  Simzer, 514 So. 2d 372 (Fla. 2d DCA 1987)

20
Middle Term Marriages

• "Gray" area marriages (generally 9 -15 years) -
  The court must examine the factors in light of
  the evidence and without any presumption for or
  against permanent alimony, unless the parties
  agreed one parent would be a stay-at-home parent
  during the 9-16 years.

21
Long Term Marriages

• Long term marriages (15 years) - There is a
  presumption in favor of permanent alimony, unless
  the parties leave the marriage in comparable
  positions.

22
Considerations

• Inability to be self-supporting due to lack of
  marketable skills combined with age/poor health
  requires permanent alimony. Bain v. Bain, 553 So.
  2d 1389 (Fla. 5th DCA 1990) Moler v. Moler, 508
  So. 2d 520 (Fla. 4th DCA 1987).
• Disparity in income due to marital relationship
  is a basis for permanent alimony. Cloud v. Cloud,
  586 So. 2d 492 (Fla. 1st DCA 1991).

23
More considerations

• The court must consider all financial resources
  of the parties (total assets, total debts, and
  debts against assets including non-marital
  property and liabilities), not just their
  income., 263 So.2d 223 (Fla. 1972). Firestone v.
  Firestone
• Portion of pension retained by payor spouse as
  part of equitable distribution of property at
  time of divorce may be considered as income in
  calculating the ability to pay alimony in
  post-divorce modification proceedings. Acker v.
  Acker, FL Sup Ct No. SC02-1925, 2005 Fla. LEXIS
  693 30 Fla. L. Weekly S 235, Decided April 14,
  2005.
• But consider potential unfairness of this
  double-dip

24
Imputation of Income

• Court may impute income to a spouse who is
  earning less than he/she could with the use of
  best efforts. Quinones v. Quinones, 870 So. 2d
  108 (Fla. 2d DCA 2003) Ritter v. Ritter, 690 So.
  2d 1372 (Fla. 2d DCA 1997)
• However, there must be competent, substantial
  evidence supporting the conclusion that the
  spouse could earn the imputed amount. Hinton v.
  Smith, 725 So. 2d 1154, 1156 (Fla. 2d DCA 1998)

25
No need to dissipate assets for ones support
post divorce

• Less affluent spouse should not have to dissipate
  capital assets for support. Henning v. Henning,
  507 So. 2d 164 (Fla. 3d DCA 1987)
• Consistent with general rule around the U.S.

26
Bridge the Gap or transitional alimony

• Fla. Stat. 61.08 Does not specifically
  authorize transitional or "Bridge-the-Gap
  alimony.
• The 1st, 2nd, 3rd, and 4th District Courts of
  Appeal have allowed this form of alimony.
• The Fifth District does not appear to allow this
  type of alimony. Martin v. Martin, 582 So. 2d 784
  (Fla. 5th DCA 1991), but see Vick v. Vick, 675
  So. 2d 714 (Fla. 5th DCA 1996).

27
Bridge the Gap Alimony

• "Bridge the Gap" alimony is appropriate to allow
  a disadvantaged spouse to "transition" between
  being married and single. Iribar v. Iribar, 510
  So.2d 1023 (Fla. 3d DCA 1987) Shea v. Shea, 572
  So. 2d 558 (Fla. 1st DCA 1990) Borchardv.
  Borchard, 730 So. 2d 748 (Fla. 2dDCA 1999).

28
Considerations

• Should be used to assist a spouse with
  legitimate, identifiable, short-term needs under
  such circumstances in which an award is
  reasonable and the other spouse has the ability
  to pay
• Is not a compromise between opposing positions

29
2nd DCA special Bridge the Gap rules

• The Second DCA approved the use of lump sum
  payments (which could be made as periodic
  payments) for this transition purpose.
• Bridge-the-gap alimony must be awarded as a form
  of permanent lump sum alimony that does not
  terminate upon the death of the payor or the
  remarriage of the payee. Athey v. Athey, 849 So.
  2d 333 (Fla. 2d DCA 2003)

30
Adultery as a factor in Alimony

• Fla. Stat. 61.08(1). "The court may consider
  the adultery of either spouse and the
  circumstances thereof in determining the amount
  of alimony, if any, to be awarded.

31
But not as the only factor

• A party's marital misconduct, standing alone, is
  not a valid reason to preclude an award of
  alimony unless the misconduct has depleted
  marital assets, or resulted in greater financial
  need. Mosbarger v. Mosbarger, 547 So. 2d 188
  (Fla. 2d DCA 1989) (Wife's attempted murder of
  husband, for which she was convicted, did not
  preclude award of alimony to her based upon
  financial need) Eckroade v. Eckroade, 570 So. 2d
  1347 (Fla. 3d DCA 1990) Noah v. Noah, 491 So. 2d
  1124 (Fla. 1986).

32
Misconduct factors to consider

• But only if related to depletion of assets or
  increased financial need
• Adultery
• Drugs or Alcohol
• Injury to spouse by other spouse
• Sexually transmitted disease
• Criminal conduct of alimony seeking spouse
• Intentional tort
• Bigamous marriage

33
Lump Sum Support Alimony

• The payment of a definite sum by one spouse to
  the other for support
• It may be an award of cash, property or payments
  to a third party
• The award is final and vests in the receiving
  spouse
• It may be paid in a lump sum or in installments
• Lump sum alimony may be paid from a party's
  non-marital assets in cases of special need

34
Factors to Consider

• Same as for other forms of alimony, plus
• The requesting spouse brought assets to the
  marriage or assisted in the acquisition of
  property. Thompson v. Thompson, 546 So. 2d 99
  (Fla. 4th DCA 1989), remanded, 576 So2d 267 (Fla.
  1991).
• The payor is financially able to pay a lump sum
  without substantially affecting his/her business
  or profession or she is unable to make periodic
  payments.
• A lump sum is necessary to provide recipient
  spouse with security against payor spouse's
  possible early demise or disability. Rosen v.
  Rosen, 386 So. 2d 1268 (Fla. 3d DCA 1980).
• Lump sum alimony would accomplish putting a
  definite end to the relationship between the
  parties.

35
Lump Sum Alimony for Equitable Distribution

• More closely resembles property than alimony
• Not subject to traditional analysis of alimony
  factors

36
When used?

• Lump sum or installments may be ordered if there
  is justification and the economic status of the
  payor would not be substantially endangered.
• Such an award, however, can generate several
  complex issues, including
• How the award is taxed. Borchard v. Borchard, 730
  So. 2d 748 (Fla. 2d DCA 1999)
• Whether the award is dischargeable in bankruptcy.
  Doerjlein v. Doerjlein, 724 So. 2d 153 (Fla. 5th
  DCA 1998)
• Whether the award is enforceable by contempt.
  Mattera v. Mattera, 629 So. 2d 1106 (Fla. 4th DCA
  1994)

37
Modification of Alimony - Requirements

• A substantial change in circumstances
• The change was not contemplated at the time of
  final judgment of dissolution
• The change is sufficient, material, involuntary,
  and permanent in nature
• Pimm v Pimm, 601 So. 2d 534 (Fla 1992)

38
Restrictions on Modification

• Modification allowed prospectively only
• Payments already accrued cannot be retroactively
  modified

39
Cross-State Modification

• States can modify orders from other states
  prospectively only (unless the original state
  permits retroactive modifications few do)
• Cant retroactively cancel arrearages to date
  before petition for modification
• Must have personal jurisdiction over the parties
  to modify other states alimony order
• Sistare v Sistare, 218 US 1, 16-17 (1910)

40
Payors voluntary retirement as a factor for
modification of alimony

• Age
• Health
• Motivation for retirement
• The type of work the payor performs
• The age at which others engaged in that line of
  work normally retire.

41
Double-Dip Problem

• Is a pension awarded as an asset at the time of
  equitable distribution then to be considered as
  income for the purpose of alimony modification?
• Issue arises when alimony payor retires and seeks
  to reduce or terminate alimony, but still has
  pension income from which he or she could pay
  alimony
• In other words, can the same dollars be an asset
  at the time of divorce for the purpose of
  equitable distribution and then be transformed
  into income later when alimony modification is
  sought?

42
In Florida, Double-Dip May Be OK

• Acker v Acker, FL Sup Ct No. SC02-1925, April 14,
  2005
• A court is permitted to consider a pension which
  has been equitably distributed to the payor in
  determining the payor's ability to pay alimony.

43
Is age 65 a safe haven for voluntary retirement?

• It is normal retirement age, but
• the court should consider the needs of the
  receiving spouse and the impact a termination or
  reduction of alimony would have on him or her
• In assessing those needs, the court should
  consider any assets which the receiving spouse
  has accumulated or received since the final
  judgment as well as any income generated by those
  assets (see Acker).

44
Effect of Cohabitation on Alimony

• New language in FL Stat. 61.14(1)(b) creates
  specific factors for court to consider when asked
  to terminate or reduce alimony upon recipients
  cohabitation (eff. 6-10-05) in those cases where
  alimony is terminable upon remarriage
• Those factors focus on the financial impact of
  the cohabitation
• Payor has burden of proving that a supportive
  relationship exists between recipient and the
  cohabitant.

45
Cohabitation factors in new statute

• Holding out as married
• Length of cohabitation period
• Pooling of assets and income
• Mutual financial support
• Performance of valuable services for one another
• Working together to create something of value
• Joint contributions to purchase of real or
  personal property
• Expressed or implied agreement concerning
  property or support
• Support for one anothers children

46
Shifting presumption

• Once support to or from the cohabitant is
  established, the burden shifts to the recipient
  to show continued need.
• - Lee v. Lee, 544 So. 2d 1083 (Fla. 1st DCA 1989

47
Effect of Remarriage

• Permanent periodic alimony automatically
  terminates upon the recipients remarriage.
  Canakaris v. Canakaris, 382 So. 2d 1197 (Fla.
  1980).
• But the remarriage must be a valid marriage, not
  just a de facto marriage. Buchan v. Buchan, 550
  So.2d 556 (Fla. 5th DCA 1989). - This is the
  case that led to the new termination upon
  cohabitation statute

48
Effect of Death

• Permanent periodic alimony generally terminates
  on the death of either spouse. Canakaris v.
  Canakaris, 382 So.2d 1197 (Fla. 1980).
• On agreement of the parties, however, the final
  judgment may provide for alimony to continue
  after the death of the payor. Florida National
  Bank v. McCarthy, 547 So.2d 1239 (Fla. 2d DCA
  1989).

49
Other states

• Death of payor does not terminate alimony, but
  may be a factor in seeking modification.
• Alimony becomes an obligation of the payors
  estate.
• Flager v Flager, 190 Mich. App. 35 475 N.W.2d
  411 (1991)

50
Security for Payment of Alimony

• Name recipient as beneficiary of a policy on the
  life of the payor.
• Amount of death benefit should be equal to the
  present value of the stream of future alimony
  payments
• Requires a decision about life expectancy - or
  how long alimony will be paid if permanent
  periodic
• Requires selection of discount (interest) rate

51
Enforcement of Alimony

• Contempt power of court available to enforce
  alimony
• Civil contempt intended to coerce compliance
  with court orders
• Criminal contempt punish party for past
  wrongdoing
• Contempt generally not available to enforce
  property provisions of settlement or judgment in
  FL (La Roche v. La Roche, 662 So. 2d 1018 (Fla.
  5th DCA 1995). Is allowed in many other states.

52
Civil Contempt

• Must show that the respondent has the ability to
  comply with the order he/she has violated
  (ability to purge contempt)
• Order of contempt must describe what the
  respondent needs to do to purge the contempt
• Incarceration is generally for an indefinite
  period of time until contempt is purged

53
Criminal Contempt

• Most of the procedural protections associated
  with a criminal trial apply
• Sentence is for a fixed term as punishment for
  violation of the courts order (or disrespect for
  the courts authority)

54
Other enforcement mechanisms

• Income withholding (similar to child support)
• Execution and garnishment of bank accounts or
  assets
• Liens on property
• QDRO on retirement assets
• Not exclusively to divide pension rights
• Can be used to enforce alimony or child support

55
Limitations on enforcement

• Each installment of alimony is considered a
  judgment on the date it is due
• Statute of limitations (typically 10 years)
  applies to each installment and may bar
  collection of installments due before the
  limitation period
• Limitations periods often tolled if
• Respondent out of state during limitation period
• Respondent makes payments toward the debt