1. Why is life insurance such an important consideration in a divorce case?
A main component of any divorce case is life insurance. If a father or mother dies, then how can the child support be paid? Moreover, if a dependent ex-wife relies on alimony to survive, it can be disastrous if her former husband dies. One of the main factors in considering the possibility of a party’s death is life insurance protection. Often family courts require the parties in divorce proceedings to obtain life insurance to guarantee the continuation of payments ordered by the court for alimony, child support, or to pay for the college education of the children.
The amount of life insurance that the court may require depends on the financial condition of the parties. In my experience, the court requires relatively poor families to obtain $100,000 worth of term life insurance for each child. For a middle class family, the normal range is $150,000 worth of term life insurance for each child. Finally, for more affluent families, the courts require $500,000 worth of term life insurance for each child.
2. If an individual dies without a will, what is the surviving spouse entitled to?
Where the surviving spouse has children of the same marriage and no stepchildren, the spouse will inherit the entire estate.
If there is a child or children of the same marriage, and the surviving spouse has a child or children of a prior union, then the spouse will take the first 25% of the estate, but not less than $50,000 nor more than $200,000, plus one-half of any balance. The decedent’s children (from this marriage or any prior union) share the other half equally.
If the decedent has children from a prior union, the spouse will take the first 25%, but not less than $50,000 nor more than $200,000, plus one-half of any balance. The decedent’s children (from this marriage or any prior union) share the other half equally.
If there are no children, but the decedent is survived by parent(s), the spouse will take the first 25% of the estate, but not less than $50,000 nor more than $200,000, plus three-fourths of any balance. The parents will inherit the other one-fourth.
3. How are inheritance rights impacted in a divorce?
Divorce clients should be advised to revise their will and estate plan after divorce proceedings. A clause in a will that leaves a bequest to the ex-spouse may be invalid because of the divorce. However, this doesn’t mean that the will is void.
If a spouse dies, then the surviving spouse may elect to take one-third of the estate. This is called an elective share. Basically, a spouse can’t be disinherited. The surviving spouse has a right to this one-third elective share of the deceased’s estate. The only way that a surviving spouse can be completely disinherited is if the parties execute a prenuptial agreement. In a prenuptial agreement, both spouses can agree to waive any claims to an elective share of each other’s respective estates.
It is important to emphasize that N.J.S.A. 3B:8-1 provides that the right to elect the statutory share is cut off if, at the time of the spouse’s death, the couple were living in different habitations, or had ceased to cohabitate as man and wife. Basically, a spouse has no right to an elective share of one-third of the estate if the couple is “living separate and apart” or under circumstances which would give rise to an action for a divorce.
4. My husband amassed hundreds of thousands of dollars in medical bills when he was fighting his cancer at the Robert Wood Johnson Medical Center. Am I legally responsible for paying for my deceased husband’s medical bills?
This is a very involved question and there are several possible ways to answer it. In New Jersey, a spouse has a duty to provide the “necessaries” for the other spouse so long as the husband and wife are living together. Under New Jersey law, most courts would hold the wife responsible for her husband’s medical bills provided that they were living together during the period when the medical bills were amassed.
A very illustrative case is Jersey Shore Medical Center-Fitkin Hospital v. Estate of Baum, 84 N.J. 137 (1980). Here, the New Jersey Supreme Court held that both spouses are liable for the necessary expenses incurred by either spouse in the course of the marriage. Both parties are responsible for each other’s necessary expenses incurred during the marriage. So long as the marriage subsists, the financial resources of both spouses should be available to pay the creditor who provides the necessary goods and services to either spouse. However, any judgment creditor must first seek satisfaction from the income and the property of the spouse who incurred the debt. If those resources are insufficient, then the creditor is then justified in seeking the collection of the bills from the income and the property of the other spouse.
When the spouses are not living together, the case law will not hold a spouse responsible for his or her spouse’s debts. In the case of National Account Systems, Inc. v. Mercado, 196 N.J. Super. 133 (App. Div. 1984), it was held that a wife would not be liable for the hospital bills of her husband, as they had been separated for four years. The marriage was simply not viable and the couple was not a financial unit at the time of the husband’s hospitalization. It was not reasonable for the hospital to assume that the wife’s assets would be available for the payment of its bill.
In summary, medical services rendered to a spouse are regarded as “necessaries.” If the couple were living together when the medical bills were incurred, then the obligation rests upon the surviving spouse to pay these bills that were caused by the decedent spouse’s last illness.
5. Who obtains custody of the children if the custodial parent should die?
A common question in any divorce scenario is whether the custodial parent can name someone other than his or her ex-spouse or soon-to-be ex as the guardian for the children. While a parent can name anyone he or she chooses, a court will presume that the surviving parent is fit and will award custody to that parent. The court will ignore any other designated guardian for the children.
There are exceptions to this presumption. Some typical factual situations where parental rights can be terminated are if one parent has a severe criminal record or a drug or alcohol problem. If a child is adamant about refusing to live with the surviving parent, then there may be a chance that the court will follow the wishes of the child. However, the court would have to be convinced that the child was not unduly influenced and that the child’s choice would be in his or her best interest.
6. Can the grandparents obtain custody of the children if a custodial parent dies?
If a custodial parent should die, it is not uncommon for a nasty custody battle to arise between the surviving natural parent and the grandparents. In the case of Watkins v. Nelson, 163 N.J. 235 (2000), the New Jersey Supreme Court held that disputes should be settled in favor of the natural parent unless the third party is a “psychologically parent,” unless a biological parent is unfit, or unless exceptional circumstances exist. There is a presumption of custody in favor of the parent.
In Watkins, the father began seeking custody shortly after the mother died in a car accident twelve days after giving birth. The grandparents never alleged that the father was an unfit parent, but only that they had become psychological parents to the child, who had been living with them since the mother’s death. A crucial issue decided by the Supreme Court was the standard to be applied: the best interest of the child test versus the termination of parental rights. The court ruled that upon the death of a custodial parent, in an action for guardianship of a child, a presumption exists in favor of the surviving biological parent. The presumption can be rebutted by proof of gross misconduct, abandonment, unfitness, or the existence of exceptional circumstances, but not by the simple application of the best interest test.
7. What happens to alimony upon the death of the payor spouse?
In New Jersey it is clear that alimony terminates upon the death of the payor spouse, except that any arrearages that have accrued are fully enforceable. In summary, if a payor spouse has amassed a significant debt of unpaid alimony arrears, then this debt can be a claim against the estate. The executor of the estate will then be obligated to pay off the alimony arrears from the assets of the estate. However, the executor will have no legal obligation to pay any more periodic payments of alimony to the surviving ex-spouse.
8. What happens to child support if the father should die?
As men are living longer, it is not uncommon for them to have two or even three families in their lifetime. If a husband should die, quite typically the current family and children from a prior marriage(s) fiercely compete for their “share” of his estate. A common misconception is that the estate of a person under a child support order has no obligation to continue to pay child support. This is not always true. In New Jersey, the Supreme Court has held that a court has the power to enter a child support order for the minor child who survives the father’s death. See, Grotskey v. Grotskey, 58 N.J. 354 (1971).
