Asset-Based Alimony Payments Permissible; Modified Amounts Must Relate Back to Notice and Future Reinstatements Require Evidence
In the Matter of Donald Nixon and Roxanne Nixon, Supreme Court of New Hampshire (May 30, 2025)
Introduction
This commentary analyzes the New Hampshire Supreme Court’s order in In the Matter of Donald Nixon and Roxanne Nixon, No. 2023-0614 (May 30, 2025), a significant alimony-modification decision issued by order under Supreme Court Rule 20(3). The case addresses three interrelated questions central to modern support litigation:
- When, and to what extent, may a court require an obligor to satisfy an alimony arrearage from assets awarded in the divorce rather than current income?
- How should courts determine the effective date and amount of a retroactive modification under RSA 458:19-aa, including whether arrearages must be recalculated at the modified rather than original rate?
- May a court reinstate a prior alimony amount prospectively based on anticipated future earnings without evidence of the parties’ actual future circumstances?
The parties divorced in 2016, stipulating to $5,000 per month in alimony for 120 months. Husband earned roughly $200,000 plus bonuses as an IT director; Wife earned about $70,000. During the pandemic, Husband suffered a 25% salary reduction and was laid off effective June 1, 2021, receiving severance through April 2022. He filed to modify alimony in 2020, continued paying $5,000 through severance, then stopped paying in March 2022 while retraining in nursing and receiving VA disability. Wife’s income rose to approximately $140,000; the parties each held meaningful retirement and investment assets.
The trial court ordered Husband to pay a $70,000 arrearage from his assets, set alimony at $1,000 per month for two years during his schooling, and reinstated the original $5,000 monthly alimony thereafter. Husband appealed.
Summary of the Opinion
Applying the unsustainable-exercise-of-discretion standard, the Supreme Court reversed in part, vacated in part, and remanded:
- Asset-based payment of arrears: The Court reaffirmed that a trial court may, in appropriate circumstances, require an obligor to satisfy alimony from assets awarded at divorce (consistent with Walker v. Walker). It rejected Husband’s argument that doing so impermissibly modifies the property division. However, it vacated the arrearage order for lack of necessary factual findings about (a) whether a more productive use of Husband’s assets could generate support, and (b) Wife’s continuing need for alimony in light of her changed circumstances.
- Effective date and amount of modification: Because Husband filed to modify in 2020, the court held the trial court had statutory authority to modify back to the date of notice (RSA 458:19-aa, I-a; Birmingham). The trial court erred by modifying only from the hearing date without explanation and by calculating arrears at the original $5,000 rather than considering the modified $1,000 amount for the retroactive period (see Walker). The $70,000 arrears and the two-year $1,000 order were vacated and remanded for proper findings and recalculation.
- No speculative future reinstatement: The reinstatement of $5,000 per month two years hence was reversed as speculative. Attorney proffer that Husband “will” earn a six-figure income if hired by a large hospital is insufficient; alimony must be grounded in the parties’ actual conditions at the time the modification is implemented (Nassar).
The matter returns to the trial court to make explicit findings applying Walker and Canaway, to revisit effective dates and amounts under RSA 458:19-aa, and to base any future change on the parties’ actual circumstances.
Detailed Analysis
Precedents and Authorities Driving the Decision
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Walker v. Walker, 133 N.H. 413 (1990):
Walker squarely rejects the contention that an alimony order becomes an impermissible modification of the divorce property settlement merely because the obligor may need to liquidate or reallocate assets to pay support. The property division does not guarantee a particular investment posture; courts may require an obligor to utilize assets productively to meet support obligations. In Nixon, this principle is central: the Supreme Court affirms that ordering arrears paid from assets is permissible, but demands careful, explicit findings on asset productivity and necessity of liquidation. -
In the Matter of Canaway & Canaway, 161 N.H. 286 (2010):
Canaway emphasizes two vital points: (1) courts can consider whether the obligor can deploy assets more productively (e.g., charging rent, earning reasonable returns) to meet obligations without necessarily liquidating them; and (2) the recipient’s continuing need for alimony is pivotal, especially where evidence shows financial dependence. Nixon instructs trial courts to make findings on both fronts—asset use and recipient need—before ordering asset-based arrears. -
RSA 458:19-aa, I-a (Supp. 2024) and In re Birmingham, 154 N.H. 51 (2006):
A modification “shall not be effective prior to the date that the notice of the petition for modification was given.” Nixon recognizes the trial court had authority to modify back to Husband’s 2020 filing but failed to explain why it set the effective date at the hearing. On remand, the court must revisit the effective date, tied to notice, and recalculate arrears accordingly. -
Walker (retroactivity of amount):
Walker cautions against calculating retroactive arrears at the prior (higher) rate once a modification is warranted for the retroactive period. Nixon reiterates that, if a modified obligation applies to a prior period, arrears should be recalculated at the modified rate, not the original amount. -
In the Matter of Nassar & Nassar, 156 N.H. 769 (2008):
Alimony must be based on the parties’ actual conditions, not external indices or speculation. Nixon invokes Nassar to reject the trial court’s automatic reinstatement of the $5,000 obligation two years later based solely on counsel’s conjecture of “six-figure” earnings. -
In the Matter of Doherty & Doherty, 168 N.H. 694 (2016):
The party seeking modification bears the burden to show a substantial, unanticipated change since the original award; the court must examine both parties’ changed circumstances and the stipulation. Nixon applies this framework to evaluate Husband’s job loss and retraining, and Wife’s doubled income. -
In the Matter of Fowler & Fowler, 145 N.H. 516 (2000):
Alimony’s primary purpose is rehabilitative—encouraging the recipient’s financial independence. Nixon directs trial courts to consider Wife’s increased income and assets in assessing ongoing need, consistent with alimony’s rehabilitative aim. - Standards of Review: Arvenitis (unsustainable exercise of discretion), Kurowski (objective basis), Braunstein (no reweighing the equities), and Canaway (deferential review unless legally erroneous or lacking evidentiary support). Nixon faithfully applies these standards while identifying where findings were legally insufficient or speculative.
Legal Reasoning and Application
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Ability to pay from assets versus income:
The Court clarified there is no inherent contradiction in finding that Husband cannot pay from current earnings yet can pay from assets. Under Walker, courts may require payment from assets awarded at divorce. However, before imposing asset-based arrears, the trial court must:
- Assess whether the obligor can reconfigure or use assets more productively to generate sufficient income, avoiding unnecessary liquidation (Walker; Canaway).
- Evaluate the recipient’s current need for alimony in light of changed circumstances (Canaway; Fowler), particularly given Wife’s doubled income and significant retirement balances.
- Determine whether any asset dissipation occurred (none was found here), and if liquidation is necessary only after exploring reasonable income-generation alternatives.
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Effective date and amount of modification:
Because Husband filed for modification in 2020, the court had authority under RSA 458:19-aa to make the modification effective no earlier than the date of notice of that motion. The trial court’s silence on effective date and its decision to calculate arrears at the original $5,000 rate despite a later $1,000 modification triggered vacatur. On remand, the court must:
- Set or explain the effective date tied to the notice date of the 2020 motion (Birmingham; RSA 458:19-aa, I-a).
- Recalculate any arrearage using the modified alimony for the retroactive period if the facts support modification for that timeframe (Walker’s retroactivity principle).
- Speculative future earnings cannot support automatic reinstatement: The reinstatement of $5,000 per month two years after the trial court’s order was reversed because it rested on speculation that Husband would secure a “six-figure” nursing job. Nassar requires evidence of the parties’ actual conditions at the time of the modification, not projections or counsel’s proffer. Even “six-figure” is too vague; a $100,000 nurse’s salary may differ substantially from Husband’s former $200,000-plus IT compensation with bonuses. Future adjustments must be grounded in concrete, contemporaneous facts.
Practical Impact and Guidance
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For trial courts:
- Make explicit findings on: (a) the obligor’s capacity to use assets more productively; (b) whether partial liquidation is necessary; and (c) the recipient’s continuing need for alimony given present income, assets, and budget.
- Tie the effective date of any modification to the statutory notice date; explain any divergence.
- When modifying, recalculate arrearages at the modified rate for the retroactive period if warranted.
- Avoid automatic, time-triggered reinstatements. Base any future changes on the conditions that exist when the change is to take effect.
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For practitioners:
- File and serve modification motions promptly; the notice date sets the earliest possible effective date for changes.
- Develop an evidentiary record on asset productivity (e.g., expected investment yields, rental capacity, pension draw options) and on the recipient’s budget and need.
- Offer concrete data, not proffers, about future earnings; defer reinstatement proposals until facts are known or propose contingent review rather than automatic changes.
- Request specific findings on effective date, arrearage calculation method, and whether a modified rate should govern the retroactive period.
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For parties:
- Alimony can be ordered from assets if income drops; courts will expect reasonable steps to generate income from assets before liquidation.
- Recipients must be prepared to show ongoing need; significant income growth may reduce support.
- Arrearages may be recalculated if a modification is warranted for the retroactive period, reducing exposure relative to the original rate.
Complex Concepts Simplified
- Unsustainable exercise of discretion: A deferential review standard. The Supreme Court asks whether the trial court’s decision had a reasonable evidentiary and legal basis. It does not reweigh evidence but corrects legal errors or decisions lacking support.
- Property division vs. alimony enforcement: Post-divorce, alimony obligations can require the obligor to use or even sell assets awarded in the property division. This is not a “modification” of property division; it is fulfillment of a support duty (Walker).
- “More productive use” of assets: Before ordering liquidation, courts examine whether assets can be used to generate income (e.g., invest idle cash prudently, rent out property, draw a reasonable pension) sufficient to meet support.
- Effective date of modification (RSA 458:19-aa, I-a): A modification can take effect no earlier than the date the other party was notified of the modification petition. Courts should expressly identify this date and explain the chosen effective date.
- Retroactive arrearage calculation at the modified rate: If a lower (or higher) alimony amount is justified for a retroactive period, arrears should be recalculated using that modified amount, not the original figure (Walker).
- Rehabilitative alimony and “continuing need”: Alimony aims to help a spouse become self-sufficient. If the recipient’s income and assets have grown substantially, the need for alimony may diminish, affecting amount and duration (Fowler; Canaway).
- No speculative reinstatements: Future alimony changes must rest on the parties’ actual conditions when the change is to take effect, not predictions or general economic assumptions (Nassar).
Conclusion
Nixon delivers a careful recalibration of alimony modification in New Hampshire post-judgment. It confirms that:
- Courts may order alimony and arrears to be paid from the obligor’s assets without disturbing the divorce property division, provided they evaluate whether assets can be used productively and assess the recipient’s ongoing need.
- Modification effective dates must be anchored to the notice required by RSA 458:19-aa; when modification applies retroactively, arrears should be recalculated at the modified rate.
- Prospective reinstatements based on conjectured future earnings are impermissible; modifications must be grounded in the parties’ actual circumstances at the time of implementation.
By vacating the arrearage and interim orders for lack of essential findings, and reversing the speculative reinstatement, the Supreme Court underscores a disciplined, evidence-based approach to alimony modifications. The decision harmonizes prior precedents—Walker, Canaway, Birmingham, Nassar—with the statutory framework, and provides a clear roadmap for trial courts and practitioners handling post-divorce support in a landscape where income disruptions and retraining are increasingly common.
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