Allport v. Allport and Applications for Negotiated Agreements

Unlike some other states, and unlike child support, in North Carolina there is no formula to determine the amount and duration of alimony. And where there is uncertainty, there is hotly contested litigation, but there is also room to negotiate.

In a recent case, Allport v. Allport, No. COA24-369, the North Carolina Court of Appeals upheld an alimony award of $14,767.52 monthly permanent alimony to the dependent spouse who was aged 63 at the time of trial, despite her multiple degrees and former employment as an attorney. This case involved a couple, who each had an individual estate valued at between two and three million dollars after the consent equitable distribution order and it has essential guidance on high income marital cases, cases involving parties nearing retirement, and cases involving illicit sexual behavior.  Here the trial court found no bad faith when the dependent spouse, aged 63 at the time of trial, did not seek employment after she had been out of the workforce for many years despite her previous employment as an attorney and the Court of Appeals, therefore, upheld the trial court’s decision not to impute income to her. One of the key lessons from this case is that the trial court is required to treat retirement contributions and assets the same for both parties. So, for instance, if the trial court allows a supporting spouse to reduce his net monthly income by his retirement contributions, the same treatment should be afforded the dependent spouse, or at least she should not be required to take early distributions from her retirement to supplement her income. Also, since the trial court determined the dependent spouse was not acting in bad faith, the trial court was not required to impute social security income she could receive if she elected for early retirement. As to the illicit sexual behavior, the trial court was not improperly punishing the supporting spouse but instead made an appropriate finding of fact as to the “especially egregious illicit sexual affair,” along with many other findings supporting the amount and duration of alimony.   

In this case as in other cases before, the Court emphasized that alimony is determined on many factors listed in N.C. Gen. Stat. §50-16.3A, including the standard of living established during the marriage and that the accustomed standard of living means “more than mere economic survival” and that indeed, the purpose of alimony is to allow the dependent spouse to “enjoy the accustomed standard of living the parties enjoyed during their marriage.” Allport v. Allport No. COA24-369 citing Williams v. Williams, 299 N.C. 174, 181, 261 S.E 2d 849, 855 (1980). Husband’s argument that the trial court failed to consider how the parties’ needs and incomes would change over time (Husband was 62 and expected his income would be drastically reduced within 5 years) was rejected because it was speculative. No one can predict the future and the ability to modify alimony based on a change in circumstances means that both spouses have a remedy if circumstances change. They can file a motion to modify alimony. 

This case involved a 4-day alimony trial with testifying financial experts on each side, the cost of an appeal, and the right to go back to court and do it all over again if circumstances change. The Court of Appeals is correct; orders must be based on actual evidence not speculation and so the fully litigated alimony case may yield a result that virtually guarantees future litigation and more attorney’s fees. Negotiated agreements, through the collaborative law process or otherwise, may yield a more durable agreement where the parties can plan ahead for contingencies such as retirement. Advice from a neutral financial expert, often used in the collaborative law process, may be accepted by a party as more reliable and accurate than the opposing party’s expert. Attorneys involved in negotiating alimony agreements can prepare their clients by informing them ahead of a mediation/negotiation about the uncertainty of the trial process, that accustomed standard of living means more than mere subsistence if you lived a luxurious lifestyle during the marriage, that the court decides what your reasonable expenses really are (in this case, the trial court reduced the dependent spouse’s reasonable needs and expenses by about 30%), and that a four-day trial with competing experts and an appeal costs more than mere money. It may seriously impair a co-parenting relationship going forward and keep the parties involved in litigation for years. And litigation creates real emotional suffering. When parties are properly informed as to the uncertainty of the amount and duration of alimony in North Carolina, and given a realistic idea of what amount of alimony they can expect to pay or receive, they can be prepared to engage in creative problem-solving to reach a lasting agreement. [i]

[i] See also Yeun-Hee Juhnn v. Do-Bum Juhnn, 242 N.C. App. 58, 775 S.E. 2d 310 (2015) where the Court of Appeals upheld an award of 18 years of alimony after a 16-year marriage and Ellis v. Ellis, 767 S.E.2d 413, 238 N.C. App. 239 (2014) where the Court of Appeals upheld an alimony award of 2 years after an approximately 14-year marriage following a condoned affair early in the marriage). The duration of alimony varies widely in North Carolina.