Litigation

A payee spouse is only entitled to the balance of alimony due after the payor spouse's death and not the entire amount of life insurance carried by the payor spouse to secure the alimony payments. Konczyk v. Konczyk, Docket No. A-5151-02T3, Superior Court of New Jersey, Appellate Division, March 15, 2004.

The parties' settlement agreement provided that the former husband (the decedent) was required to pay the former wife $200 per month for 5 years and thereafter $100 per month until the former wife's 65th birthday. During the period that the former husband was required to pay $200 per month, he was required to maintain a life insurance policy in the sum of $20,000 to secure his alimony obligation to his former wife. The agreement further provided that after the alimony sum decreased to $100 per month, the husband was required to maintain a life insurance policy in the sum of $15,000 until his alimony obligation was fulfilled on the wife's 65th birthday. The husband died owing the wife $2000 (20 months of alimony). Before the husband's death, he changed the beneficiary of the policy from the former wife to the parties' two adult children. The former wife filed a motion seeking the entire $15,000 in life insurance, and the children filed a motion arguing that the former wife was only entitled to the $2000 balance due to her. The trial court held that the former wife was only entitled to $2000. Although the issue had never been decided in New Jersey, the court held that in other jurisdictions where life insurance is used to secure a limited alimony obligation, and the amount owed at the time of the payor's death exceeds the obligation, the payee spouse is entitled only to the balance of the obligation due and not to the entire life insurance proceeds. The appellate court affirmed, stating that the former wife was not entitled to any more than the amount of alimony the decedent would have been obligated to pay had he lived.