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On September 25, 2017 the Massachusetts Supreme Judicial Court (SJC) issued a decision in Young vs. Young, 478 Mass. 1 (2017) and the court held that “the need for support of the recipient spouse (here, the wife) under general term alimony is the amount required to maintain the standard of living she had at the time of the separation leading to the divorce, not the amount required to enable her to maintain the standard of living she would have had in the future if the couple had not divorced.” In Young the Probate and Family Court divorce judge had issued a temporary order that the husband should pay $48,950.00 per month in temporary alimony. After contested trial, the trial judge modified the alimony order to instead require that the husband, who had very high annual earnings through a complex compensation program, instead pay 33 % of his annual gross income as alimony – so the amount would change each year (likely increase) as the husband’s income changed. After trial the husband appealed the judge’s percentage based alimony order as inappropriate.

The SJC did not strike down the use of percentage based alimony orders in all divorce cases but that court did find that a percentage based alimony order was inappropriate in Young because the unique circumstances which justify a percentage based alimony award were not present in that case. Traditionally, the three legs of an alimony order are ability to pay, need of the recipient, and a lengthy marriage. In Young the SJC noted that the historical baseline for measuring need is the “marital lifestyle the parties enjoyed during the marriage, as established by the judge…”. Note however that a recipient spouse does not “have an absolute right to live a lifestyle to which he or she has been accustomed in a marriage to the detriment of the provider spouse.” When there are insufficient resources to keep both parties at their marital lifestyle a “fair balance of sacrifice” is appropriate and that typically means “the supporting spouse generally should not be required to pay more than thirty-five percent of the difference between the parties gross incomes.”

Percentage based alimony orders are disfavored by the SJC for at least 4 reasons: (1) They don’t allow the parties to obtain a “clean break” from each other; (2) They present the potential for “continued strife and uncertainty”; (3) They make enforcement of the alimony award more difficult; and, (4) They “may encourage income manipulation” between the employee and their employer to minimize the alimony obligation. Notwithstanding that the SJC disfavors percentage based alimony orders there will still be multiple situations where such orders are completely appropriate and the percentage based order will receive judicial approval. These circumstances include paying alimony (or child support) on a percentage basis for bonus income or stock option income received post-divorce on an “if, as, and when received,” basis. Another legitimate use for a percentage based alimony order is to avoid the need to return to court when a foreseeable change of circumstances can be anticipated at the time of the alimony judgment or when the underlying payment amount includes “cost-of-living” adjustments due to a high inflation rate economic circumstance.

How does Young impact the divorce mediation process? Divorce mediation takes place in the “shadow” of applicable divorce statutes and caselaw. This decision clarifies how standard of living circumstances should be evaluated when mediating parties contemplate an alimony payment amount. It also clarifies when percentage alimony orders are both necessary and appropriate i.e. to address variable bonus or stock option income post-divorce, etc. The parties in Young likely spent six figures in legal fees before the SJC weighed-in on their alimony dispute – as our legal system allows them to do. In divorce mediation alimony disputes can be resolved easily in a low-cost process with a fair outcome for both parties. How does that sound?

The Massachusetts Supreme Judicial Court (SJC) recently clarified some provisions of the 2012 Massachusetts Alimony Reform Act (the “Act”) in a November 23, 2016 decision in the case Clifford E. George vs. Jacquelyn A. George (SJC-12059). Clifford and Jacquelyn were divorced in 2002 via a mutually agreed upon Separation Agreement after a 12-year marriage. The Separation Agreement provided that Clifford would pay Jacquelyn $1800/month as alimony. In 2013, Clifford filed a Complaint For Modification of the divorce judgment Separation Agreement which sought, among other things, to modify his alimony obligation based upon Section 49 (b) of the Act. Section 49(b) of the Act provides that general term alimony for marriages lasting more than 10 years but fewer than 15 years shall not continue for “longer than (seventy) percent of the number of months of the marriage,”. Massachusetts General Laws chapter 208, section 49 (b) (3) provides a process by which a judge can deviate from the alimony durational limit when doing so is “required in the interests of justice”. The Act also provided a phase-in schedule for when Complaints For Modification based on the new durational limits could be brought for alimony obligations that predated the effective date of the Act (March 1, 2012).

The George v. George modification action was heard by Judge Jeremy A. Stahlin at the Suffolk Probate and Family Court. Judge Stahlin denied Clifford’s Complaint For Modification because he found that deviation beyond the durational limits of the Act was warranted. Clifford appealed Judge Stahlin’s decision and the SJC took authority over the appeal.

The SJC affirmed Judge Stahlin’s denial of relief but on the grounds that Clifford’s complaint was filed prematurely (under the Act Complaints For modification of alimony based solely on the applicable durational time limits were to be filed no earlier than March 1, 2015). The SJC used the George case to set forth guidance on how the “interests of justice” standard contained in Section 49 (b) should be applied when determining whether deviation from the Act’s durational time limits is warranted.

The SJC concluded that when disputes of fact arise regarding an alimony payment termination date the trial court must make written findings based on evidence to determine whether the “interests of justice” require alimony payments to continue beyond the durational limits of the Act. The alimony recipient spouse bears the burden of proving by a “preponderance of the evidence” that deviation beyond the presumptive termination date is “required in the interests of justice”. The SJC further clarified that a judge should “evaluate the circumstances of the parties in the here and now; that is, as they exist at the time the deviation is sought, rather than the situation as it existed at the time of divorce.” If factors relevant to the alimony termination date existed at the time of divorce, and those factors persist when a Complaint For Modification is filed, “a judge may properly consider them.” The decision contains an example of this principle, “if at the time of divorce a spouse was disabled and that disability was taken into consideration in setting the initial alimony award, and if that disability persists when the payor spouse files a complaint for modification, the judge may properly consider the impact the disability continues to have on the recipient spouse in determining whether deviation beyond the act’s durational limits is required in the interests of justice.”

The Alimony Bottom Line

The SJC’s decision in George v. George clarifies that divorce court judges will have the ability to deviate from statutory time limits for alimony payments, either at the time of the divorce or at the time the payor seeks to terminate the alimony payments, when the case facts suggest deviation is appropriate and necessary. Chronic illness or unusual or unexpected health circumstances of the alimony recipient are likely to be the most common factors that justify deviation from the time limits. The bottom line of the SJC’s George decision is that a Payor’s alimony termination date can be modified outside of the Act’s time limitations when the payor proves by a preponderance of the evidence that such modification is necessary.

On March 1, 2012 the Massachusetts alimony law landscape significantly changed when the Alimony Reform Act took effect. This wide-ranging piece of legislation brought clarification and guidance to most aspects of a Massachusetts divorce case that involved alimony. The legislation clarified how different forms of alimony should be categorized and how alimony payment amounts should typically be calculated based upon the incomes of the parties and the length of the marriage. In addition, the new/revised alimony statute contained guidance on when alimony should typically end (at the obligor’s normal Social Security retirement date) and what should happen if an alimony recipient commences cohabitation with another person post-divorce (the alimony order should be “suspended, reduced or terminated”).

Most attorneys who specialize in divorce and family law appreciated that the 2012 changes to Massachusetts divorce law brought some order to an aspect of divorce that was previously chaotic and driven in large part by the specific preferences of whatever judge had the case. However, the 2012 changes failed to clearly address the matter of whether the time limits on alimony and the cohabitation provisions applied retroactively to divorce cases that were finalized prior to the 2012 changes. The Supreme Judicial Court (SJC) addressed the issue of retroactive application of alimony time limits and the effect of cohabitation in three separate recent cases (Chin v Merriot, Rodman v. Rodman, and Doktor v. Doktor) which in aggregate stand for the principle that the time limits and cohabitation provisions of the new alimony statute apply prospectively and do not automatically apply to divorce judgments entered prior to the date the new law took effect.

Massachusetts House Bill 4034 (HB 4034) has been introduced to address the prior ambiguity regarding application of the new alimony law to cases that were tried or settled prior to the date the new alimony statute took effect. HB 4034 would more or less overturn the SJC’s decisions in Chin, Rodman, and Doktor and the proposed bill would provide that:

• “An existing alimony judgment which has exceeded the durational time limits… may be modified upon the filing of a complaint for modification…”.
• “A payor of alimony paying alimony pursuant to an existing alimony judgment may file a complaint for modification … if the recipient is determined to be cohabitating…”.
•  “A payor of alimony… may file a complaint for modification of the existing alimony judgment if the payor has reached full retirement age…”.

Supporters of HB 4034 argue that the proposed legislation is necessary to give alimony obligors whose cases ended before 2012 the same predictability regarding their alimony termination date that obligors of post-2012 divorces presumably have. In addition, supporters seek to fix an arbitrary outcome whereby alimony obligors may have no remedy if their ex-spouse cohabitates and they divorced before March 1, 2012 but a similarly situated obligor does have the remedy of alimony termination or payment amount reduction when their ex-spouse cohabitates and their divorce took place after March 1, 2012.

Divorce mediation clients have an advantage over courtroom litigation clients because they have a unique opportunity to craft a comprehensive divorce agreement that addresses future oriented divorce details that might otherwise force ex-spouses back into court post-divorce. For example, when will the alimony end and what will happen to the alimony payment if the recipient cohabitates ? A comprehensive mediated divorce agreement that addresses foreseeable future outcomes can protect you against a post-divorce financial uncertainty that undermines the efforts of both parties to properly plan for their respective financial futures.