The New Jersey Upkeep Reform and the Enterprise Homeowners

On September 10th, Governor Chris Christie signed law making material changes to the way child support was granted in New Jersey. The change, which is part of a national trend to change maintenance laws, reflects changes in family dynamics, including each partner’s ability to earn an income. The New Jersey amendment seeks to reduce litigation during the duration of the alimony, but as detailed below, the modifications have the potential to increase litigation, especially for individuals who own or operate a business.

The following is a brief summary of the major changes to the New Jersey Maintenance Act:

  • The law deletes the term “permanent maintenance” and replaces it with “open permanent maintenance”. Although this change does not change the actual duration of a current maintenance claim, the Maintenance Act now provides that future maintenance claims will not last longer than the duration of the marriage, unless the marriage lasts longer than 20 years or there are exceptional circumstances.
  • In contrast to previous case law, the law provides for the presumption that the payer’s maintenance obligation ends when the payer reaches retirement age within the meaning of the Social Insurance Act, which is currently 67 if the payer was born after 1959.
  • The law now includes standards for changing or ending unemployment alimony. The amendment breaks the standard for self-employed or non-self-employed. While all of the provisions affect business owners, this change has the most direct implications, as explained below.
  • Finally, there is now a standard for termination of alimony if the dependent spouse is living together.

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While this may not be obvious at the outset, the changes to the New Jersey Maintenance Act will have a significant impact on business owners. First, in light of the new alimony restrictions, spouses will seek alternative forms of support, such as reimbursement or rehabilitation alimony. Reimbursement and rehabilitation maintenance were retained in the new law, but are only granted under very specific circumstances. Both can apply to working people – especially if a spouse has given up his career to raise children or supported his partner during his professional qualification. Knowing that the length of maintenance may be limited due to the above changes, the assisted spouse will seek other forms of assistance or seek a greater share of fair distribution (including a business share) in order to receive more money upfront.

The most important change for entrepreneurs is the determination of the proposed change to change or end the maintenance for a person who is unemployed or has a reduced income. So far, the standard has applied to all parties who sought a change in maintenance due to a decrease in income. The amendment now contains a provision specifically for the self-employed, which requires proof of the economic and non-economic benefits from the company. This analysis requires comparing current benefits with those received before the decline in income. Although this provision has not yet been analyzed, it can expose a self-employed person to the risk of admitting tax fraud or other problems that they might have avoided beforehand.

Individuals considering marriage should consider this change, especially if they are entrepreneurs. Premarital agreements that set out the rights and obligations of each spouse could reduce the risk of future litigation while protecting business assets. While the change does not yet need to be reviewed by a court, it is clear that the new conditions and factors will result in lengthy and costly legal proceedings. It is often better for spouses to take control of their own outcome and determine possible terms of the divorce than let the court rule. This is even more of a reality with the new New Jersey Maintenance Act. If you are a business owner, it is important to consider how your particular circumstances may affect your marriage or divorce, especially with regards to the new New Jersey Maintenance Act.

Carl J. Soranno Esq. is chairman of the family law practice von Brach Eichler. For more information, please send me an email at


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