The Massachusetts Supreme Judicial Court (“SJC”) recently decided Openshaw v. Openshaw, a case that changes how we think about alimony specifically in regard to the need for support to accumulate savings. The issue in Openshaw was whether a probate and family judge was right to factor in a divorcing couple’s practice of saving money during their marriage when he made an alimony award in the case.

Under Massachusetts law, alimony is “the payment of support from a spouse, who has the ability to pay, to a spouse in need of support for a reasonable length of time, under a court order.” The Massachusetts alimony statute in part provides that a judge must consider both the marital lifestyle of the parties and the ability of each party to maintain the marital lifestyle when determining the appropriate form of alimony, and the amount and duration of alimony in a case.

But what constitutes the “marital lifestyle” in the context of a divorce and alimony case? For couples with sufficient income, we’ve traditionally considered dinners out, vacations, summer homes, choice of vehicles and other luxury goods, and the like as part of the “marital lifestyle.” Openshaw, however, broadens this definition to include, when appropriate, regular contributions to savings.

“[W]e conclude that where, as here, a married couple has an established practice of saving during the marriage,” the SJC said, “a judge properly may consider such saving as a component of the couple’s marital lifestyle in awarding alimony.”

Background

Glen and Amy married in 1991 and subsequently had six children. While married, their combined gross annual income amounted to over $1.3 million. Their income enabled them to pay for their children’s extracurriculars, help their children pay rent while the children attended college, and send some of their children to private high school. They were also able to amass personal property of significant value, including jewelry, about twenty firearms, tools, and fine art and antiques, among other items.

Due in part to their comparatively modest spending, Glen and Amy were also able to routinely allocate significant portions of their income to savings and investments. It was the couple’s practice to transfer money not used to pay for the family’s immediate expenses to investment and retirement accounts monthly. They also consistently donated about 10% of their income to their church.

Amy and Glen’s combined assets amounted to at least $4.5 million. Several million of those assets were in the form of checking, savings, investment, and retirement accounts.

Probate and Family Court Proceedings

After almost 30 years of marriage, in December 2018, Amy filed for divorce. At trial, the parties disagreed regarding the custody of their youngest child, alimony, child support, and the marital estate division. Amy was living in the marital home and Glen was living in Florida. Glen had little to no contact with his unemancipated children for the two years leading up to the divorce trial.

In June 2021, the probate and family court judge entered a judgment of divorce nisi. A written memorandum—73 enumerated paragraphs long—supported the judgment. The memorandum detailed the judge’s findings of fact and rationale for his decision on the disputed matters.

Husband Ordered to Pay $5,020 per Week in Alimony (plus $980 per Week in Child Support)

The judge gave Amy sole legal and primary physical custody of the couple’s minor child. He also ordered Glen to pay $980 per week in child support to Amy pursuant to the Child Support Guidelines.

Regarding alimony, the judge ordered Glen to pay $5,020 per week in alimony to Amy. The judge based the award amount on Amy’s reported total weekly spending provided on her most current financial statement (from around the time of trial). That financial statement included $1,000 per week in savings and $730.64 per week in charitable giving.

Glen appealed the probate and family court judge’s decision regarding the alimony award.

SJC: Judge Can Consider an Established Marital Practice of Saving When Awarding Alimony

Glen argued on appeal that the probate judge, when setting the alimony amount payable to Amy, should not have considered the couple’s practice of saving during the marriage. In response, Amy argued that the probate judge was right to account for the couple’s practice of saving when considering their “marital lifestyle” because that practice underpinned their standard of living. Amy wanted the SJC to find that, because the couple customarily contributed to savings during the marriage, saving was part of the marital lifestyle. In turn, she argued that the probate and family court was right to award her sufficient alimony so that she could continue to save—as she did during the marriage—after divorce.

On this issue, the SJC agreed with Amy. “Because we conclude that a judge may consider a marital practice of saving in determining a recipient spouse’s need, and the record supports such a routine practice here,” the SJC said, “the judge did not abuse his discretion by factoring the parties’ marital practice of saving into the alimony award.”

Alimony Award: “Marital Lifestyle”

“[W]here, as here, a married couple has an established practice of saving during the marriage, a judge properly may consider such saving as a component of the couple’s marital lifestyle in awarding alimony.”

In reaching its conclusion, the SJC turned to the language of the alimony statute, which lists factors a probate judge must consider when making alimony determinations. Two factors a probate judge must consider when deciding alimony are, 1) the parties’ “marital lifestyle” and, 2) the “ability of each party to maintain the marital lifestyle.” “The plain meaning of ‘marital lifestyle’ is the characteristic manner in which the couple chose to live their life during the marriage,” the SJC said. This can include the typical way the couple allocated income during their marriage, the SJC added, as long as said allocations are “so customary as to identify the parties’ financial decision-making during the marriage.”

So, the SJC makes clear in Openshaw that the terms “marital lifestyle” and “ability of each party to maintain the marital lifestyle” don’t just have to do with consumption spending (i.e., spending on goods, services, and luxuries). Instead, the SJC said that “the plain meaning of the alimony statute’s directive that the judge must consider the ‘marital lifestyle’ and the ‘ability of each party to maintain the marital lifestyle’ requires consideration of saving where the evidentiary record shows it was a regular practice during the marriage.” The SJC continued, “These statutory terms encompass not just consumption spending on goods and services, but also the deliberate choice during the marriage to devote income to savings regularly.”

Alimony Award: “Need”

Regarding the issue of the “need” for alimony, Massachusetts law provides that an alimony award amount generally shouldn’t exceed the recipient’s need. For general term alimony (and as is the case here), “need” is essentially the alimony amount the recipient requires to maintain the lifestyle the recipient had during the marriage (when the couple separated). This is true in Openshaw because the parties earn enough combined to enable them both to maintain their marital lifestyle (i.e., their standard of living) even after divorce.

On appeal, Glen argued that the need for alimony is based on how the couple consumed goods and services during the marriage. The SJC disagreed with Glen here, given the couple’s marital practice of saving. If that were the case, according to the SJC, “then the recipient spouse either must reduce that level of consumption in order to continue the pattern of saving that characterized the marital lifestyle or must abandon the practice altogether…Such a construction would frustrate the alimony statute’s purpose of maintaining each spouse’s marital lifestyle where the parties’ postdissolution income makes that outcome possible.”

The SJC accordingly determined that a judge can consider the spouses’ regular practice of saving money during the marriage when determining the recipient spouse’s need for alimony after divorce. Otherwise, the SJC said, the court would effectively penalize those who choose to save during a marriage.

Interplay of Alimony & the Division of the Marital Estate

Glen argued that a judge cannot consider a couple’s marital habit of saving when later awarding alimony because the judge will already consider the savings when dividing the marital estate in a divorce. The SJC recognized that a probate and family court judge will consider property division and alimony in relation to each other. The probate judge must balance both and can adjust one award based on the other. Yet nothing in the law about marital estate division in divorce precludes a judge from considering a couple’s custom of saving as part of their marital lifestyle under the alimony statute.

“To be sure,” the SJC said, “an equitable distribution of the marital estate ensures that both parties reap the benefits of regular saving during the marriage in the form of the marital assets. However, where, as here, the parties’ postdissolution income is sufficient for each party to continue to live the marital lifestyle, if routine saving is not considered in connection with the determination of alimony, the recipient spouse will be forced to rely on the appreciation of current assets while the payor spouse will be able to continue the full extent of the marital lifestyle, including regular saving.”

Husband’s Challenge to Decision Awarding Alimony on Wife’s Current Spending

In determining the amount of alimony Amy would need to maintain her marital lifestyle, the probate and family judge based his award on portions of Amy’s financial statement (her reported spending) from around the time of trial. Glen took issue with this approach and challenged it on appeal. He argued that the judge credited the wrong evidence in determining Amy’s alimony need. He further argued that his accounting of the household spending in the three years before the parties’ separation better reflects the alimony amount Amy would need to maintain her marital lifestyle.

“The judge acted within his discretion in determining that the evidence submitted by the wife reflected a valid assessment of the marital lifestyle.”

“On this record, we cannot say that the judge erred in relying on financial statements filed shortly before trial to evaluate need based on the parties’ lifestyle during the marriage,” the SJC said. The SJC agreed with Glen that the recipient’s need for alimony is based on the marital lifestyle. However, the SJC said that the probate judge has discretion in determining what evidence to credit in assessing the marital lifestyle.

In this case, the SJC noted, the probate and family judge found that Glen’s numbers failed “‘to recognize that a significant aspect of the parties’ marital lifestyle was saving.” And because the SJC agreed that a probate judge may consider a marital practice of saving in determining a recipient’s need for alimony, the judge did not abuse his discretion by factoring in that marital practice into the alimony award here.

Moreover, “[the probate judge] did not accept the wife’s [financial] report blindly,” the SJC said. Instead, the probate judge scrutinized Amy’s financial statement, crediting some of her reported expenses while excluding others. The decision to credit Amy’s reported spending followed a four-day trial that included additional evidence regarding the parties’ finances as well.

Ultimately, the SJC agreed with Amy. “[T]he trial judge did not abuse his discretion in connection with the amount of weekly spousal support.”

Husband’s Challenge to the Division of Liabilities

On appeal, Glen challenged how the probate judge divided the liabilities between Amy and him. The probate and family judge found it most equitable to award 55% of the marital estate to Amy and 45% to Glen. So, he awarded 55% of marital assets to Amy and 45% to Glen. In doing so, the judge considered statutory factors regarding marital property division, “especially the disparity in the parties’ employability and opportunity to acquire future assets and income,” said the judge.

Regarding marital liabilities (debt), however, the probate judge assigned each party the liabilities listed in their own names. The judge assigned $5,032 in liabilities to Amy and $343,280 in liabilities (98.6% of the total marital debts) to Glen. While the debt the judge assigned to Amy consisted of credit card bills, Glen’s liabilities (except for $280) were for the family’s 2020 and 2021 tax debt. Dividing liabilities in this way skewed the net division of the marital estate. Amy ultimately got about 59% of the marital estate and Glen got 41%.

The SJC found that this division of liabilities was erroneous. The record from the probate and family court did not give the judge’s reasoning for deviating from his intent to divide the marital estate 55-45. And, the judge also failed to adequately explain why the liabilities should be assigned mostly to Glen even though they consisted primarily of the family’s tax debt.

The SJC vacated the parts of the probate and family court judgment that addressed the liabilities division. Regarding that issue, and that issue alone, the matter was sent back to the probate court for further proceedings.

Otherwise, the SJC affirmed the probate and family court judgment.

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