Monday, July 25, 2011

Navigating Changes in Alimony Over Time

The purpose of alimony “is to avoid any unfair economic consequences of a divorce, even after property is divided and child support, if any, is awarded.”[1] Two Massachusetts cases illustrate how alimony changes over time, particularly when one spouse reaches retirement age.
In Pierce v. Pierce (SJC-10381), Rudolph Pierce, the former husband, had been paying $110,000 annually in alimony while earning approximately $450,000 each year as a partner in the law firm where he worked. At the age of 65, Pierce voluntarily retired and filed a motion to eliminate the alimony he was paying to his ex-wife Carniece due to his retirement. At the time of his retirement, Rudolph Pierce had remarried and his second wife earned $125,000 annually. In this case, the judge ruled that a reduction of alimony to $42,000 a year was fair for all parties involved. On appeal Rudolph Pierce again asked the court to eliminate his alimony obligation. The appeals court however found that while reaching retirement age is certainly a factor to consider in alimony judgments, the opposing party’s financial situation is also important to weigh when considering an alimony modification. In this case Carniece Pierce had recently become unemployed, had not received any severance, was not remarried, and at age 64, was not receiving Social Security benefits.  Furthermore, the judge concluded that while Rudolph was able to maintain the same standard of living that he had enjoyed pre-retirement, Carniece would not be able to maintain that standard without Rudolph’s alimony support. The judge also concluded that Rudolph would be able to afford the reduced alimony payments of $42,000 annually.
In contrast, in the case of Ross v. Ross (10-P-1130), the judge allowed that upon Adam Ross’ retirement, he no longer needed to pay alimony. In this case the judge allows that the defendant’s good faith retirement at the age of 65 would prevent him from being able to pay alimony due to his decreased income. Furthermore the judge demonstrates how Joan Ross’ need for alimony has diminished in the time since their divorce. Going back to the definition of alimony, intended to level the playing field, the judge found that in the 10 years since the divorce, the parties children have become emancipated, Joan can be self-supporting based on her skills, education and experience, and she does not need alimony to maintain her lifestyle. Another point of note is that at the time of the appeal, Adam was nearly 66 while Joan at almost 14 years his junior has more earning potential through employment or investments.
These two cases illustrate how the former spouse’s current economic situation remains a central factor when calculating alimony, even after one party reaches retirement age.


[1] http://legal-dictionary.thefreedictionary.com/alimony