What is a New Jersey Separation Agreement?
A separation agreement is a contract between a husband and wife providing for the rights and duties of each spouse after their separation. The separation separates the couple, but does not terminate their marital status. We would often advise clients of the benefits and pitfalls of obtaining a separation versus a divorce. Sometimes it is better for a party to enter into a separation agreement rather than a divorce, if there is no domestic violence, drug or alcohol abuse or if both parties have agreed that they would like to maintain their marital status.
For example, a husband and wife may want to separate if they do not want to be found within the state for fear of being subject to alimony. Or, they may physically separate, i.e. get the husband into a sober living house and treat his alcoholism while the wife stays out of the marital home with the children until he gets treatment for a few months, and he cleans himself up sufficiently. Or, it may be that the parties do not want to divorce because of religious or cultural restrictions.
The legal effect of a separation agreement is that it creates contractual obligations between the parties. As with any contract , the parties may negotiate the terms and conditions of the agreement, and if they reach an understanding, it is memorialized in a written document, which is then signed by both parties. The parties may "merge" or "survive" the agreement. If the agreement survives, it has the same legal effect as a court order. If the agreement merges, it may be used to form the basis for future litigation, like determining alimony or equitable distribution, for example.
A separation agreement provides many benefits to each of the parties. The parties will determine when child support is due, and what amount should be paid for support. Child custody issues will be resolved, and the parties will agree on who pays for what, and when it is to be paid. This could include out of pocket medical expenses, college expenses, etc. Furthermore, since the parties are still married, the publication and advertisement in the newspaper is not necessary, and they will not have any other major publications or notices, as is required in a divorce, clerical errors are limited, etc.
Essential Elements of NJ Separation Agreements
A robust NJ separation agreement must be comprehensive and specific. Although there is no standardized template that must be adhered to, there are certain elements that you will need to include in your written contract with your spouse. Some of the most common components of a NJ separation agreement are: Property Division: A separation agreement must outline how your property is to be divided between the two of you. This usually involves assigning percentages and/or specifying who will pay for specific pieces of property. If, for example, you owned the family home together, are you going to sell the house and split the profits or one of you will buy the house from the other? All of the real estate property must be dealt/identified in the property division section of the agreement. Child Custody Arrangement: In your separation agreement, you and your spouse will outline exactly how you plan to care for your children after you separate. Parents often choose to split custody and share equal parenting time with their kids, or one parent may have primary custody of the children. If you decide on an equal parenting structure, you will have to outline the parenting schedule in detail so that there is no room for confusion. Perhaps weekends will be alternated, or the children will be with one parent for an entire week. Whatever you choose, you must outline the plan clearly in your NJ separation agreement. The agreement can also outline any child-related issues that you and your spouse will need to deal with during and after the separation such as: parenting time schedule, where the children will celebrate the holidays, support of the children, medical insurance coverage, travel arrangements, etc. Child Support: When a separation agreement involves kids and parents who make a combined gross income of $187,200 or less, they must use the NJ Child Support Guidelines to determine child support levels in addition to the parenting time schedule. If you and your spouse earn more than this, you can negotiate your own terms but the NJ courts always have the discretion to change your child support amounts if they view it as being in the best interest of the children. Alimony: While your NJ divorce settlement will still need to account for alimony, your separation agreement is the opportunity to carve out a short-term arrangement while you both figure out your long-term plans. If you and your spouse share children, you should consider child support an essential component of your separation agreement. Alternatively, if you do not have kids, you may not need to incorporate any alimony information into your contract with your spouse.
How to Properly Complete a Separation Agreement
Over my years of practice, I have drafted many separation agreements. The following is a somewhat step by step approach to drafting a separation agreement after the parties are in agreement that this is the best, next step after recognizing that they want to be separated. Of course, each case has its own unique circumstances that may alter some of these steps.
A separation agreement, as I prepared them, generally deals with the following provisions: 1. a list of assets, some values and who will get what; 2. a list of liabilities, some values and who will get what; 3. allocation of attorney fees for preparation of the agreement (often one party will agree to pay all of the fees of both); 4. health insurance coverage and the allocation, if any, of cost; 5. a list of assets the parties own jointly with a specific provision addressing who will do what to transfer the account/asset from joint ownership to the sole ownership of the other; 6. provisions addressing tax liability, preparing tax returns and indemnification in the event the IRS disagrees with the return; 7. where the marital home will be listed for sale, provide that notice has to be given before any further expenditures or changes in the home. If in the agreement you agree to wait to sell the house until some contingency occurs, you must provide for a review of your finances before the contingency occurs to determine whether after the contingency takes place should you still sell the home or one of you will purchase the home from the other; 8. if there are children, the agreement should provide for the appointment of a Parenting Coordinator, Child Tax Exemptions, payment of child related expenses, who will be responsible for extracurricular costs (if too difficult to determine at the time of the agreement then provide that it will be included in the final Judgment of Divorce); 9. a simple provision regarding alimony. Keep in mind your rights if you have children as there are less rights in terms of alimony if you have children; 10. you should provide for the exchange of financial documents; 11. the agreement should provide for the identification or payment of the obligations of the parties (such as credit card or mortgages) during the separation period; 12. you need to set forth a formula for when each other’s belongings are to be taken from the house; 13. you should always, as an attorney, provide for a lawyer review clause. You should actually have them initial the clause acknowledging that they had the right to counsel. My practice is to represent one party and have that party pay the attorney fees with the other party having the right to review everything. This way I can have my client agree to pay these fees. In addition, I have the right to withdraw if a party refuses or resists the proper procedure. After the entire agreement has been prepared by my office, I have a paralegal prepare a form checklist that lists all of the agreements of the parties to make sure nothing is missed before the agreement is executed. This is an essential step or you may miss something. You want to have all agreements, all properties, all accounts and valuables identified so that nothing is to be re-integrated into the marital estate if you are serious about obtaining a divorce later on.
Separation Agreements: Legal Requirements and Enforceability
In order for a New Jersey separation agreement to be valid, it must meet certain legal requirements. The agreement should be in writing and signed by both parties. Each party should have the opportunity to review the agreement with legal counsel prior to execution. In the case of a post-nuptial agreement, both spouses must voluntarily enter into the agreement and there must be full, fair and reasonable disclosure between the parties. This means that each party must fully disclose their assets, liabilities and any other relevant information required by the other party. Separation agreements are not automatically enforceable under New Jersey law. A court will only enforce a separation agreement if it finds that the agreement is fair and equitable and if there has been no fraud or misrepresentation between the parties. A court may also modify or set aside the separation agreement if it believes that the terms of the agreement are not in the best interests of the parties or their children. In some circumstances, a spouse may seek to have a separation agreement annulled if they can show that the agreement was not voluntarily entered into or that one spouse did not fully disclose their assets or other relevant information. In these cases, the court may find that the agreement is unenforceable and order it set aside. This is why it is important for spouses to fully disclose their assets and responsibilities to each other prior to entering into a separation agreement.
Using Mediation to Create a Separation Agreement
In the context of the creation of a New Jersey Separation Agreement, what role does divorce mediation play? After all, mediation is known for the resolution of disputes. In fact, the vast majority of cases, including family law disputes like divorce cases, filed with the Court are resolved without any involvement by the Court in terms of a decision by a Judge. The bulk of these resolutions come in the form of a Settlement Agreement between the parties which is often assisted through the process of divorce mediation. This is also true for separation agreement cases where the central business is divorce mediation. Divorce mediators in NJ help divorcing couples with dividing assets and debts, parenting time schedules for children, child support and alimony (spousal support) . When parties reach an agreement on these issues, the mediator will draft a Settlement Agreement which they will both review before it is filed with the Court. This is a very common (and sometimes required) process in NJ divorce law. Since this is the standard, it is not surprisingly that divorce mediators NJ also assist parties married who do not have children and/or do not want to get divorced immediately and instead will file with the court a Complaint for Divorce and a Verified Complaint to Convert into Divorce Judgment at a future date. This is the basis for separation agreements in New Jersey divorce law which are widely accepted by the Court.
Modifications and Termination of Separation Agreements
A separation agreement is a contract. Like all contracts, it is presumed that the terms are set until the parties demonstrate otherwise. As such, both agreement resolution (formal divorce) and legal separation may occur shortly after a separation agreement is reached. If there are minor children involved, you may not be able to formally divorce until children become of age, or if the parties have been married less than two years in a state that requires a waiting period.
The presumption is that the terms cannot be modified until there are changed circumstances in the lives of one or both parties. Examples of changed circumstances include new jobs, health problems, greater or lesser need of child support or alimony, relocation, changes in child care or schooling arrangements, or even a decision by one of the parties not to marry again. Each case is different and upon consideration of whether there have been changed circumstances, the courts also will listen to other factors in deciding whether to modify or terminate the agreement.
The change must be substantial, not just wear and tear and boredom or dissatisfaction. A basic approach to determining whether there is a substantial enough change to justify modification of the agreement is to ask whether the agreement, as written, would have been entered into if the change in circumstances had existed.
Where the circumstances are changed sufficiently, the courts may modify all or some of the provisions of the separation agreement – such as the amount of child support or alimony awarded, or even custody and visitation provisions. In the end, the courts will determine whether the terms are fair after considering the circumstances of the parties in the present, not in the past, in deciding whether to modify or terminate the agreement.
Separation Agreements: Common Pitfalls
When entering the separation agreement negotiation process, there are a number of common mistakes that many couples encounter and should avoid. First and foremost is retaining the services of an unreliable attorney. Many people think that any lawyer can handle such issues, such as the division of assets and the payments of alimony and other forms of support. Not true, and hiring any lawyer who does not have a lot of experience in family law can be a huge mistake. Your divorce is likely the most important legal action you will ever enter into, and you need a known problem solver who can help you navigate the complicated settlement and litigation process.
Other common mistakes often involve: Diving into the process without hiring both parties often makes it impossible to address financial and other issues such as spousal support and child custody. Be sure to proceed slowly and carefully, so that nothing escapes you.
New Jersey Separation Agreement FAQs
Separation agreements are a common, and often misunderstood, part of divorce in New Jersey. As a result, I’ve compiled a list of some of the most common questions I get about separation agreements from my clients:
What’s the difference between legal and physical separation in NJ?
When a couple separates, there is often a best option that can help them achieve their goals. A physical separation is when either one spouse moves out or both spouses decide to live apart together. A legal separation is where you would jointly file paperwork with the NJ Superior Court to obtain a divorce order, but you still maintain your marital status. In most cases, couples seek legal separation for health care, tax and/or insurance benefits.
Is a legal separation the same as a divorce in NJ?
Not exactly. However, obtaining a legal separation can serve the same purposes as divorce. It is required, by law, that you and your spouse are "separated" for at least 18 months before filing for a no-fault divorce in NJ. As such, obtaining a legal separation can avoid any delay in filing for divorce once the 18 months is up. However, legal separation is not intended for divorcing couples who wish to continue their lives together in a marriage-like setting.
Are NJ Separation Agreements the same as Divorce Agreements?
No. When you obtain a divorce agreement , you are finalizing all issues and ending your marriage with a divorce order signed by the court. Many of the terms found in your divorce are also included in your NJ Separation Agreement, but they are not legally binding, nor do they end your marriage. Additionally, once you file for divorce in NJ, you legally are considered married until the divorce is finalized.
What if the Judge disagrees with the terms of the NJ Separation Agreement drafted by both parties?
If an agreement can be reached, the judge handles the terms of the NJ separation agreement and decides whether it’s enforceable under state law. Still, the judge also approves both parties’ settlement agreement as long as both agree voluntarily to its terms. The judge will not act as a mediator to reach an agreement if you can’t reach a compromise.
Do I need an attorney to prepare a Separation Agreement in NJ?
To be enforceable under New Jersey law, legal separation agreements should be drafted by an experienced family law attorney. Skilled separation lawyers make sure the terms are clear and comprehensive to prevent any misunderstandings or misinterpretations. With a family law expert handling the paperwork, you can feel confident that your legal rights are protected.