North Carolina Divorce and Alimony
On October 1, 1995, the law of spousal support in North Carolina changed dramatically. These changes increased the number of spouses who are eligible to receive postseparation support and alimony in this state. The changes may, however, decrease the duration of spousal support payments in many cases. Shorter terms for alimony are most expected with younger, more employable dependent spouses.
Only a dependent spouse is eligible to receive postseparation support and/or alimony in this state. The statutes of North Carolina define a dependent spouse as “a spouse, whether husband or wife, who is actually substantially dependent upon the other spouse for his or her maintenance and support or is substantially in need of maintenance and support from the other spouse.” Without economic dependency, a spouse is not entitled to a judicial award of postseparation support or alimony in North Carolina.
“Postseparation support” is the new term in the North Carolina statutes for funds paid to a dependent spouse by the other spouse until the earlier of either the date specified in the order of postseparation support, or an order awarding or denying alimony. Spouses can also enter into a voluntary agreement regarding postseparation support with any terms and conditions they choose. This kind of support used to be known as “temporary alimony” (or “alimony pendente lite”).
Support that is of potentially longer duration is now known as “alimony;” this kind of support used to be called “permanent alimony.” Spouses can also enter into a voluntary agreement regarding the payment of alimony, again with any terms and conditions they choose. A dependent spouse can also waive or forego either postseparation support and/or alimony by agreement.
Under the old law, if the parties were unable on their own to settle the issue, permanent alimony submitted to a judge could only be decided on by the judge after the property of the marriage had been distributed. That is no longer the required chronology. However, if alimony is now awarded prior to a division of the marital property, a party may request that the alimony award be reconsidered once the property is divided. Both the amount and the duration of alimony can be reevaluated after the property is finally divided.
The tests for postseparation support and alimony are somewhat different under the new law in North Carolina. To be eligible for postseparation support, a dependent spouse must show that his or her resources are not adequate to meet his or her reasonable needs, and that the supporting spouse has the financial means to pay postseparation support. In deciding the inadequacy of the dependent spouse’s resources and the supporting spouse’s ability to pay, a court looks at the parties needs in light of their accustomed standard of living, their incomes, their income-earning abilities, debt service obligations of each party, and their necessary expenses. By contrast, the language of the alimony statute requires an award of alimony in cases where the court finds an alimony award to be equitable. There are a number of factors, discussed below, the court is to use in making this determination about the equitableness of an award of alimony.
Qualifying for Support. Both the old alimony law and the new law use financial dependency as a primary criterion in setting the amount and term (duration) for alimony. Economic dependency can, however, now be a sufficient condition for the receipt of alimony. Under the prior law, dependency was a necessary but not a sufficient condition for receiving alimony.
This is the largest difference between our old alimony statute and our new one. Under the old law, economic need was not enough to qualify a spouse for support. Under our prior alimony law, the dependent spouse also had to show that the other spouse (who is still called the “supporting spouse” under the new law) had committed some marital fault. Marital fault included actions such as abandonment, adultery, indignities, excessive use of alcohol or drugs, reckless spending, and failure to provide for a spouse’s subsistence needs. These things continue to be marital fault under the new law, so long as the fault occurred during the marriage and before or on the date of separation; and a dependent spouse can still put on evidence of fault as one of the factors that a judge can consider in an alimony hearing. But a showing of fault is no longer a pre-condition for an award of postseparation support or alimony.
Amount of Support. Unlike child support in North Carolina, there are no recommended guidelines as to the appropriate amounts of postseparation support and alimony to be received by a dependent spouse. In essence, the test used by the court is two-fold. First, a judge will determine how much money the dependent spouse needs to meet his or her reasonable needs, consistent with the standard of living in the final years of the marriage. The judge makes this determination by measuring a spouse’s reasonable monthly expenses against the amount of his or her available income and other financial resources. Second, the judge decides whether the supporting spouse has the financial ability to pay the amount of alimony that would be fair and just. These same standards are, of course, useful guides in settlement negotiations, where parties are trying to predict what would occur were the support case to be litigated.
Under the new law, in determining the amount and duration of alimony, the judge in fact examines anything and everything, above and in addition to the basic two-part test, that relates to a party’s alimony claim. In order to view the big picture of what is “equitable,” the court is required to consider all relevant factors, including but not limited to the following:
The relative earnings and earning capacities of the spouses;
The ages and the physical, mental and emotional conditions of the spouses;
The duration of the marriage;
The standard of living of the spouses established during the marriage;
The relative needs of the spouses;
The contribution of a spouse as homemaker;
The relative education of the spouses and the time necessary to acquire sufficient education or training to enable the spouse seeking alimony to find employment to meet his or her reasonable economic needs;
The extent to which the earning power, expenses, or financial obligations of a spouse will be affected by reason of serving as the custodian of a minor child;
The amount and sources of earned and unearned income of both spouses, including, but not limited to, earnings, dividends, and benefits such as medical, retirement, insurance, social security, or others;
The marital misconduct of either of the spouses through the date of separation;
The contribution by one spouse to the education, training, or increased earning power of the other spouse;
The relative assets and liabilities of the spouses and the relative debt service requirements of the spouses, including legal obligations of support;
The property brought to the marriage by either spouse;
The federal, state, and local tax ramifications of the alimony award; and
Any other factor relating to the economic circumstances that the court finds to be just and proper.
So you can also see that fault plays a role under the new alimony statute in North Carolina. Because our case law interpreting the new statute will not develop for some years, no one can yet be certain how important fault will be in postseparation support and alimony hearings. Trial judges in North Carolina have, after all, until very recently been required to find a spouse is at fault before he or she can be required to pay support to the dependent spouse. Under the new law, fault such as abandonment by the other spouse continues to be defined as marital misconduct , so it may still be considered by a judge as one of the factors listed above. However, it would be only one factor of the many factors which the court is required to examine. In summary, even without misconduct by the supporting spouse, a dependent spouse in need of financial support can now theoretically receive an award of postseparation support and/or alimony in North Carolina. The only situation in which a dependent spouse will be absolutely barred from getting spousal support will be in an alimony (not a postseparation support) case in which the supporting spouse can prove the other spouse’s uncondoned illicit sexual behavior, with no similar fault having occurred on the part of the supporting spouse. Conversely, if the supporting spouse does indeed commit marital misconduct, but the other factors listed above indicate that the dependent spouse should not receive alimony, then the judge may choose not to award any alimony to the dependent spouse. The decision whether to award support is a matter completely within the judge’s discretion.
Term for Alimony. Alimony under court order is payable as either a lump sum or in the form of periodic payments, for a specified or an indefinite term. Five possible termination conditions set the end date for an indefinite term, and that would be when: (1) the parties resume marital relations; (2) the recipient dies; (3) the payor dies; (4) the recipient remarries; or (5) the recipient cohabits with another adult of the same or opposite gender. The fifth possibility for termination of alimony is that the award expires on its own terms after a fixed length of time. In settlement negotiations, the parties frequently agree on a fixed-term option, although if they can agree on different termination conditions that is of course also acceptable.