Pizi v. BolamBrian G. Paul of the firm’s family law department successfully defended an ex-husband’s appeal of a Family Part Judge’s denial of his request to reduce alimony and child support. At the time of the divorce, the husband was earning $450,000 per year as a Vice-President at Merrill Lynch. Post-Divorce, the ex-husband left Merrill Lynch, and received a severance package that provided him with substantial deferred compensation in the form of restricted Merrill Lynch stock. The restricted shares were not eligible for release to the ex-husband until several years later.
A few years after leaving Merrill Lynch, the ex-husband filed a motion to reduce alimony and child support, claiming that his income had dropped to $200,000 per year. The $200,000 represented ex-husband’s salary from his new employment. In contrast, Brian asserted that the ex-husband’s income was actually in excess of $700,000 per year, because $500,000 of Merrill Lynch restricted stock stemming from his severance package had been released to him that same year. Therefore, the issue on appeal was whether the restricted shares of Merrill Lynch stock should be included when determining whether the ex-husband had demonstrated a substantial change in circumstances warranting a reduction in the alimony and child support.
The Appellate Division agreed with Brian’s argument that the restricted shares represented a form of deferred compensation, and that the ex-husband realized income for child support and alimony purposes in the year that the restricted shares were released. Therefore, the Appellate Division agreed with Brian’s argument that the husband had failed to demonstrate a substantial change in circumstances warranting a reduction in alimony and child support, and the Trial Court’s decision was affirmed.
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