Divorcing couples tend to think of "alimony" as monthly payments made in the form of cash to one spouse or the other, usually for a finite period of time that terminates by a certain date or in the event of remarriage. For the most part, this is exactly true.
However, the Georgia Supreme Court recently handed down a ruling in White v. Howard indicating that other assets (namely, a life insurance policy) could potentially be considered alimony for purposes of divorce. Brooklyn alimony attorneys recognize that this could make certain elements of divorce a bit messier for family courts seeking to ensure both sides are treated fairly.
This case involved a pair married for 35 years at the time of their separation. In the final divorce decree, the court indicated that neither party would be entitled to alimony, but did order the following:
- That the husband obtain a life insurance policy worth $100,000 that named the wife as the beneficiary and maintain that policy for 12 years.
- That the wife was to receive half of the husband's pension.
- That the husband was supposed to make partial payments on the mortgage of the home in the wife's name until such time that the property was sold.
The court specifically stated in its order that these items were to be considered matters of equitable distribution of property - and not alimony. That order was issued in 2007.
Four years later, the wife remarried. Shortly thereafter, the husband filed a pro se motion (meaning without an attorney) seeking to terminate all three of these benefits, arguing they were a form of alimony that should be terminated when she remarried.
The wife responded with a motion to dismiss and a request for attorney's fees. The husband retained an attorney and subsequently filed a motion to modify alimony. A trial court held a hearing and issued a ruling in favor of the wife, dismissing all claims and granting attorneys fees. The court cited the earlier specification that these elements were not alimony, but part of equitable distribution of marital property.
The husband did not fight back on the issue of the ongoing mortgage payments or pension, but he did appeal the decision as it related to the life insurance policy. He insisted this was a form of alimony.
The state supreme court ultimately agreed with him.
The court first explored the definition of periodic alimony, which is when maintenance payments are slated for an indefinite period of time, making the total amount indefinite as well. The court indicated that such orders could be modified if the financial circumstances of either party changed substantially. By contrast, with equitable distribution of assets, the assets in question are fixed, and the trial court doesn't have the authority to modify a final order on these matters, regardless of a change in circumstance. Also, lump sum alimony payments (those wherein the spouse receives a set amount of maintenance to be paid at one time) cannot be modified.
The wife argued in this case that the life insurance policy was a form of either lump sum alimony or equitable distribution, therefore not subject to modification.
The court disagreed with this because of the uncertainty that comes with a life insurance policy - specifically, the unknowable fact of how long the husband is going to live. That means it could be worth the 12 annual premiums he paid, or it could be worth $100,000, plus whatever premiums he paid up until the point he died. Because the value could not be determined, it was subject to modification.
Further, the court cited a previous case (Hawkins v. Hawkins) wherein the court had already established that the obligation to carry life insurance for the benefit of the other spouse is in fact a form of periodic alimony.
On these grounds, the supreme court reversed the trial court's ruling on this matter and remanded for reconsideration, based on the wife's remarriage.
If you are interested in alimony modification in Brooklyn, call our offices at (718) 864-2011.
White v. Howard, May 19, 2014, Georgia Supreme Court
More Blog Entries:
Court: Phone Sex Not Grounds for Resetting the Divorce Clock, May 18, 2014, Brooklyn Divorce Lawyer Blog