Opinion
DOCKET NO. A-1001-12T4
05-11-2015
RALPH IRALDI, Plaintiff-Appellant, v. LYNN IRALDI, n/k/a LYNN FRANCES CHONSKI, Defendant-Respondent.
Stacey L. Spinosi, attorney for appellant. Maury K. Cutler, attorney for respondent.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION Before Judges Simonelli and Leone. On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Gloucester County, Docket No. FM-08-0323-12. Stacey L. Spinosi, attorney for appellant. Maury K. Cutler, attorney for respondent. PER CURIAM
In this matrimonial matter, plaintiff Ralph Iraldi (Ralph) appeals from those parts of the September 19, 2012 supplemental final judgment of divorce (FJOD) and the February 1, 2013 and March 5, 2013 post-judgment orders that concern equitable distribution of the marital home and land on which it was built, property tax arrears, college and graduate school costs, child support, and attorney's fees and costs. For the following reasons, we affirm.
We use the first names throughout this opinion for ease of reference. We mean no disrespect in so doing.
Equitable Distribution of the Land and Marital Home
and Payment of Property Tax Arrears
Ralph and defendant Lynn Iraldi, now known as Lynn Frances Chonski (Lynn), built their marital home on land that Ralph received from his parents and land that he and Lynn purchased after their marriage and commingled with that land. The trial judge determined that the land and marital home were subject to equitable distribution as property acquired in contemplation of marriage. The judge allocated a 55% interest to Ralph and a 45% interest to Lynn. The judge also ordered Ralph to pay property tax arrears.
On appeal, Ralph contends that because the land from his parents was a pre-marital gift and the deed to the marital home was in his name only, the trial judge contravened N.J.S.A. 2A:34-23(h) in ruling that the land and marital home were subject to equitable distribution. Ralph also contends that the judge failed to apply N.J.S.A. 2A:34-23.1 in making the equitable distribution allocation and abused his discretion by not ordering Lynn to pay 50% of the property tax arrears. We conclude that all of these contentions lack merit.
We derive the following facts from the trial record. In the late 1970's and early 1980's, Ralph's parents purchased vacant lots adjacent to their home, some of which they intended to eventually transfer to Ralph. In December 1986, Ralph and Lynn met and began dating shortly thereafter. Ralph testified that he lived with his parents at the time he met Lynn and began staying overnight at her apartment four or five days a week in the summer of 1987, and kept personal items there; however, he did not change his address and stayed at his parents' home two days a week to help them with their upholstery business. He testified that he and Lynn became engaged on Christmas Eve in 1987, and he began living in her apartment after they married on November 12, 1988.
Lynn claimed that she and Ralph began living together shortly after they began dating and were engaged on November 15, 1987, not Christmas Eve. She also claimed that she paid all the living expenses when they lived together while Ralph saved his money.
Ralph's mother, Phyllis Iraldi (Phyllis), testified that on November 19, 1987, she and her husband executed a deed transferring title to the land to Ralph and gave him $45,000 to construct a house on the land. They also gave Ralph a $3000 "gift" to purchase adjacent property and Ralph used $4000 of his own funds to purchase other adjacent property. Phyllis testified that Ralph was not engaged to Lynn when she and her husband gave him the land and money, and Ralph alone developed the plans for the house and began building it before he married Lynn.
Ralph's testimony contradicted much of Phyllis's testimony. For example, Ralph testified that his parents only gave him $40,000 to build the house, which they paid directly to the builder after he and Lynn were married; his parents knew that the house would be the marital home; he and Lynn jointly developed the plans for the house; construction began after they were married; and his parents loaned him and Lynn a total of $7000, which they used to purchase the adjacent properties. Ralph admitted that he and Lynn jointly purchased the adjacent properties after the marriage and comingled them with the land to make it a corner lot.
Ralph admitted that his parents forgave the loans for the adjacent properties. Accordingly, the loans were not an issue at trial.
Ralph also testified that construction began in August 1989, after the marriage, and was completed in January 1990, at a cost of approximately $99,000 financed by the $40,000 from his parents and $59,000 from his pre-marital savings. Ralph admitted that the $40,000 from his parents and his $59,000 were "a gift to the marriage" and neither he nor his parents expected to be re-paid and were not seeking re-payment.
We reject Ralph's argument on appeal that the trial judge abused his discretion by precluding Ralph from explaining on redirect examination what he meant when he said on direct examination that the monies were "a gift to the marriage." "Control of the examination of witnesses, particularly on redirect examination, is a matter which must be left largely to the discretion of the [trial] court." Wimberly v. Paterson, 75 N.J. Super. 584, 610 (App. Div.), certif. denied, 8 N.J. 340 (1962).
Ralph also admitted that he and Lynn built the house knowing it would be the marital home, they had a marital partnership with respect to the marital home, she contributed to making improvements, they lived there with their three children for more than twenty-two years, and he never told her that she did not own the land or marital home. At trial, the parties stipulated that the land was valued at $55,000, and the land and marital home were jointly valued at $248,000.
In 2002, the parties jointly encumbered the property with a $25,000 home equity line of credit, which they later converted into a home equity loan. They stipulated that the loan balance was $12,501.70, as of February 9, 2012.
During the marriage, each party contributed to the household bills and Lynn paid the bills from a joint bank account. When their relationship began to deteriorate in 2008, they closed the joint account and agreed that they would pay the bills that were in their respective names; the property tax bill was in Ralph's name, so he had to pay the property taxes. Ralph made some payments, but fell into arrears. Lynn offered to pay 50% of the arrears, but only if she received 50% of the marital home. The parties stipulated that the arrears totaled $14,728.35 as of June 2012.
In a comprehensive August 16, 2012 oral opinion, the trial judge made detailed factual findings and legal conclusions. The judge specifically found Ralph's and Phyllis's testimony about the land transfer not credible and Ralph's testimony about when he began living with Lynn and when the engagement occurred not credible. The judge credited Lynn's testimony on these facts and found that the land transfer occurred after the engagement, the land and money from Ralph's parents were gifts in contemplation of marriage, Ralph's pre-martial funds were a gift to the marriage, and the parties planned to build a marital home on the land in contemplation of marriage. The judge concluded that the land and marital home were subject to equitable distribution. After considering the factors in N.J.S.A. 2A:34-23.1, the judge awarded Ralph a 55% interest and Lynn a 45% interest and provided specific reasons for this allocation.
As for property tax arrears, the judge found that because the parties agreed in 2008 that Ralph would pay them, he must pay the property tax arrears up to the second quarter of 2012. The judge also ordered that beginning the third quarter of 2012 and until the property was sold, Ralph must pay 45% of the property taxes and Lynn 55%. The judge ordered the marital home to be sold. Ralph ultimately purchased Lynn's interest in the marital home.
Our review of a trial court's equitable distribution of marital property is strictly limited. Genovese v. Genovese, 392 N.J. Super. 215, 222 (App. Div. 2007). We should affirm an equitable distribution award provided "the trial court could reasonably have reached its result from the evidence presented, and the award is not distorted by legal or factual mistake." La Sala v. La Sala, 335 N.J. Super. 1, 6 (App. Div. 2000), certif. denied, 167 N.J. 630 (2001). Thus, we need only consider whether there was sufficient credible evidence in the record supporting the trial court's decision and whether the decision represents a proper exercise of the court's broad discretion to divide the parties' property. Sauro v. Sauro, 425 N.J. Super. 555, 573 (App. Div. 2012), certif. denied, 213 N.J. 389 (2013).
Moreover, we defer to the factual findings of family court judges because they have special expertise, Cesare v. Cesare, 154 N.J. 394, 413 (1998), and do not second-guess their exercise of sound discretion. Hand v. Hand, 391 N.J. Super. 102, 111 (App. Div. 2007). We also defer to the family court judge's credibility determinations. N.J. Div. of Youth & Family Servs. v. G.M., 198 N.J. 382, 396 (2009). However, where we review questions of law, a trial judge's findings "are not entitled to that same degree of deference if they are based upon a misunderstanding of the applicable legal principles." N.J. Div. of Youth & Family Servs. v. Z.P.R., 351 N.J. Super. 427, 434 (App. Div. 2002). Applying these standards, we discern no reason to disturb the judge's rulings.
"The goal of equitable distribution . . . is to effect a fair and just division of marital assets." Steneken v. Steneken, 367 N.J. Super. 427, 434 (App. Div. 2004), aff'd as modified, 183 N.J. 290 (2005). It is a three-step proceeding subject to the trial court's discretion, in which the court must: (1) "decide what specific property of each spouse is eligible for distribution"; (2) "determine its value for purposes of such distribution"; and (3) "decide how such allocation can most equitably be made." Rothman v. Rothman, 65 N.J. 219, 232 (1974).
It is well-settled that all property, regardless of its source, in which a spouse acquires an interest during the marriage is eligible for distribution in the event of divorce. Painter v. Painter, 65 N.J. 196, 217 (1974). Generally, however, "'property owned by a husband or wife at the time of marriage will remain the separate property of such spouse in the event of divorce and will not qualify as an asset eligible for distribution.'" Tannen v. Tannen, 416 N.J. Super. 248, 281 (App. Div. 2010) (quoting Painter, supra, 65 N.J. at 214), aff'd o.b., 208 N.J. 409 (2011). All property "legally or beneficially acquired during the marriage . . . by either party by way of gift, devise, or intestate succession . . . except . . . interspousal gifts" is also generally excluded from equitable distribution. N.J.S.A. 2A:34-23(h) (emphasis added).
However, pre-marital property may be subject completely to equitable distribution where the evidence shows the property was acquired in contemplation of marriage, regardless of whether it was acquired exclusively with one spouse's funds or titled only in one spouse's name. Winer v. Winer, 241 N.J. Super. 510, 527 (App. Div. 1990). Such property is not exempt for equitable distribution under N.J.S.A. 2A:34-23.1. Rather, when property is acquired in contemplation of marriage and the parties have adequately expressed their intention to create a marital partnership prior to the marriage ceremony, the property will be subject to equitable distribution. Weiss v. Weiss, 226 N.J. Super. 281, 287 (App. Div.), certif. denied, 114 N.J. 287 (1988).
Once the court determines what property is eligible for distribution, it must then make an equitable allocation. When considering a fair allocation, the court is required to apply the fifteen statutory factors set forth in N.J.S.A. 2A:34-23.1. See Giovine v. Giovine, 284 N.J. Super. 3, 29 (App. Div. 1995). These factors include, among others, the length of the marriage, the standard of marital living, the economic circumstances of the parties, the earning capacity and income of the parties, each party's contribution to the marital assets, and any other factors deemed relevant by the court. N.J.S.A. 2A:34-23.1. The end result must reflect that "the trial judge . . . appl[ied] all the factors set forth in N.J.S.A. 2A:34-23.1 and distribute[d] the marital assets consistent with the unique needs of the parties." DeVane v. DeVane, 280 N.J. Super. 488, 493 (App. Div. 1995).
Because the land was a pre-marital gift, N.J.S.A. 2A:34-23(h) does not apply in this case. The statute applies only to gifts acquired during the marriage, which was not the case here. Thus, the judge did not contravene the statute.
The question, therefore, was whether Ralph acquired pre-marital property in contemplation of marriage. We do not hesitate to answer this question in the affirmative. The credible evidence in the record confirms that Ralph acquired pre-marital property contemporaneously with the parties' engagement and in contemplation of their marriage and expressed their intention to build their marital home on that property. In furtherance of their intention, they purchased additional properties and jointly planned the construction of the marital home. After the home's construction, they improved it and lived there with their children for twenty-two years. It is of great significance to us that prior to filing his divorce complaint, Ralph never took any steps whatsoever that evidenced an intent that the land and marital home were not part of the marital estate. See Pascale v. Pascale, 274 N.J. Super. 429, 435 (App. Div. 1994), aff'd in part, rev'd in part on other grounds, 140 N.J. 583 (1995). Accordingly, we are satisfied that the judge properly concluded the land and marital home were subject to equitable distribution.
We are also satisfied with the judge's equitable distribution allocation. The judge considered the factors set forth in N.J.S.A. 2A:34-23.1 in making the allocation and performed a thorough and fact-sensitive evaluation of all of the applicable relevant statutory factors. See Clementi v. Clementi, 434 N.J. Super. 529, 540-41 (Ch. Div. 2013). The judge considered the length of the marriage and the parties' ages, physical and emotional health, financial circumstances, income, and standard of living. The judge also acknowledged that Lynn had received a considerable inheritance, and recognized that Ralph should be afforded the opportunity to ultimately have the marital home. The judge's decision was reasonable, was not an abuse of discretion, and is amply supported by the record. See Sauro, supra, 425 N.J. Super. at 573.
Finally, the judge correctly required Ralph to pay the property tax arrears. When their marriage began to deteriorate in 2008, the parties reached an agreement that they would pay bills in their respective names. The property tax bill was in Ralph's name and he never disputed he was responsible to pay the property taxes. In addition, he made some payments without asking Lynn to contribute or asserting she was responsible for payments. The agreement was not invalidated because the judge subsequently determined that the marital home was subject to equitable distribution or because Lynn offered to pay 50% of the arrears if she received 50% of the marital home, which she did not receive. Accordingly, we affirm the judge's ruling concerning equitable distribution of the land and marital home and payment of property tax arrears.
College and
Graduate School Costs
The parties have three children: A.I, born in 1990, N.I., born in 1992, and F.I., born in 1994. Ralph contends that because A.I. was emancipated, the judge abused his discretion in ordering him to pay 45% of her graduate school costs. Ralph also contends that in ordering him to pay 45% of N.I.'s and F.I.'s college costs, the judge improperly relied on the child support guidelines instead of considering his ability to pay.
Although the children are now adults, we use initials to identify them in order to protect their identities.
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The record reveals that A.I. began undergraduate studies in the fall of 2008. A.I.'s college costs were reduced through scholarships, grants, and other available financial aid; however, the parties paid A.I.'s tuition for the Fall semester by redeeming a certificate of deposit and liquidating their marital savings. Ralph refused to contribute to A.I.'s college expenses after Lynn received an inheritance. Lynn paid approximately $50,000 toward A.I's college expenses from her personal funds. A.I. obtained a bachelor's degree in May 2012, and pursued a graduate degree. Despite several court orders requiring Ralph to contribute toward A.I.'s tuition and expenses, Ralph never did so. As a result, the court entered judgment against him for an amount the court previously determined he owed to Lynn for A.I.'s college expenses.
N.I. began attending a two-year college in the fall of 2010. He received financial aid that covered most of his tuition and Lynn paid for his textbooks and other fees. After completing the two-year program, N.I. transferred to a four-year college and obtained student loans to pay his college expenses. F.I. began attending a two-year college in the fall of 2012. She obtained student loans to pay her college expenses, except for a $400 fee for a summer class, which Ralph and Lynn shared.
The judge first found that both parents knew A.I. intended to attend college for six years to obtain an undergraduate and graduate degree. After considering the twelve factors set forth in Newburgh v. Arrigo, 88 N.J. 529 (1982), the judge ruled that both parents were responsible for their children's college expenses, with Ralph paying 45% and Lynn paying 55%, retroactive to when each child entered college. The judge also ordered Ralph to reimburse Lynn $400 for A.I.'s college expenses for the Fall 2011 semester.
Trial courts have "substantial discretion" in deciding the issue of contribution to college expenses. Jacoby v. Jacoby, 427 N.J. Super. 109, 116 (App. Div. 2012). "'If consistent with the law, [the] award will not be disturbed unless it is manifestly unreasonable, arbitrary, or clearly contrary to reason or to other evidence, or the result of whim or caprice.'" Ibid. (quoting Foust v. Glaser, 340 N.J. Super. 312, 315-16 (App. Div. 2001)). If the "court ignores applicable standards, we are compelled to reverse and remand for further proceedings." Gotlib v. Gotlib, 399 N.J. Super. 295, 309 (App. Div. 2008).
As a threshold matter, the allocation of college costs is predicated on a finding that a parent is "financially capable." Newburgh, supra, 88 N.J. at 544. Accordingly, "financially capable parents should contribute to the higher education of children who are qualified students." Ibid. To evaluate a parent's obligation to contribute to the cost of higher education, our Supreme Court has established the twelve Newburgh factors:
(1) whether the parent, if still living with the child, would have contributed toward the costs of the requested higher education; (2) the effect of the background, values and goals of the parent on the reasonableness of the expectation of the child for higher education; (3) the amount of the contribution sought by the child for the cost of higher education; (4) the ability of the parent to pay that cost; (5) the relationship of the requested contribution to the kind of school or course of study sought by the child; (6) the financial resources of both parents; (7) the commitment to and aptitude of the child for the requested education; (8) the financial resources of the child, including assets owned individually or held in custodianship
or trust; (9) the ability of the child to earn income during the school year or on vacation; (10) the availability of financial aid in the form of college grants and loans; (11) the child's relationship to the paying parent, including mutual affection and shared goals as well as responsiveness to parental advice and guidance; and (12) the relationship of the education requested to any prior training and to the overall long-range goals of the child.The court considers these factors and the criteria in N.J.S.A. 2A:34-23(a), "as well as any other relevant circumstances, to reach a fair and just decision whether and, if so, in what amount, a parent or parents must contribute to a child's educational expenses." Gac v. Gac, 186 N.J. 535, 543 (2006). No one factor is determinative; all factors should be considered and weighed. Id. at 545. The judge "has an obligation under Newburgh and N.J.S.A. 2A:34-23(a) to consider all the enumerated factors." Gotlib, supra, 399 N.J. Super. at 309.
[Id. at 545 (codified at N.J.S.A. 2A:34-23(a)).]
In addition, it is well-established that a child over age eighteen enrolled in a full-time educational program requires continued support. See Gac, supra, 186 N.J. at 542 (indicating "[t]he Legislature and our courts have long recognized a child's need for higher education and that this need is a proper consideration in determining a parent's child support obligation"). Such is the case here, and the record adequately documented the children's financial need. Moreover, Ralph's argument regarding A.I.'s emancipation is irrelevant. The judge declared A.I. emancipated as of the date of the FJOD, nunc pro tunc August 16, 2012, "[f]or purposes of child support calculations" only. Consequently, A.I.'s emancipation had no effect on the judge's decision to require Ralph to pay 45% of A.I.'s graduate school costs.
Further, the judge properly analyzed the Newburgh factors and made detailed factual findings in ordering Ralph to pay 45% of the children's college costs. The judge's application of the Newburgh factors to the factual circumstances of this case was clearly adequate and not an abuse of discretion. Further, since the parties clearly anticipated that A.I. would attend graduate school, as she was involved in a six-year degree program, it was not an abuse of discretion to require Ralph to contribute to the costs of her graduate degree. As our Supreme Court recognized, "[i]n appropriate circumstances, parental responsibility includes the duty to assure children of a college and even of a postgraduate education[.]" Newburgh, supra, 88 N.J. at 544. Finally, Ralph provided no evidence he was financially incapable of contributing to college and graduate school costs.
"The Family Court possesses broad equitable powers to accomplish substantial justice" in awarding college contributions. Finger v. Zenn, 335 N.J. Super. 438, 446 (App. Div. 2000), certif. denied, 167 N.J. 633 (2001). The record contains ample credible evidence to support the judge's determination that plaintiff should be responsible for 45% of his children's college costs, and the decision was reasonable under the circumstances. The record indicates that the parties are fortunate enough to have three bright children with an aptitude for college who have been able to finance most of their undergraduate and graduate expenses through scholarships, grants, loans, and from paying the costs, in part, out of their own pocket. The parties' respective economic resources, while modest, enable them to provide for their children's college educations.
Child Support
Ralph contends that the judge abused his discretion by not ordering Lynn to pay child support after a change in custody for N.I. and F.I., effective December 2012. We have considered this contention in light of the record and applicable legal principles and conclude it is without sufficient merit to warrant discussion in a written opinion. R. 2:11-3(e)(1)(E). However, we make the following brief comments.
The judge determined that, during the marriage, Lynn was the children's primary caregiver. The judge deemed A.I. emancipated and designated Lynn as the parent of primary residence (PPR) for N.I. and F.I. After Lynn left the marital home on December 2, 2012, N.I. and F.I. split their time between their parents' residences. Because N.I. and F.I. would "come and go as they pleased" and "took care of themselves," the judge found the children's living situation in "equipoise." Therefore, the judge granted the parties joint custody of N.I. and F.I. and did not designate either parent as the PPR or require either of them to pay child support. However, because Lynn had paid for N.I.'s and F.I.'s clothing, cell phones and car insurance, the judge designated her as their "primary caregiver." After N.I. and F.I. moved in with Ralph in January 2014, the court awarded him child support. According to Lynn's her merits brief in this appeal, the children had been residing solely with her "[f]or the past several months." Thus, there was no reason to award Ralph child support.
Attorney's Fees and Costs
We reject Ralph's final contention that the judge abused his discretion in awarding Lynn counsel fees and costs. "An award of counsel fees is within the discretion of the trial court" and will not be overturned unless there is a clear abuse of discretion or a clear error in judgment. Harte v. Hand, 433 N.J. Super. 457, 465-66 (App. Div. 2013). An abuse of discretion "arises when a decision is made without a rational explanation, inexplicably departed from established policies, or rested on an impermissible basis." Flagg v. Essex Cnty. Prosecutor, 171 N.J. 561, 571 (2002).
The setting of an award of counsel fees in a matrimonial action is controlled by Rule 5:3-5(c) and N.J.S.A. 2A:34-23. When reviewing an application for counsel fees, the court must "consider the factors set forth in the court rule on counsel fees, the financial circumstances of the parties, and the good or bad faith of either party." N.J.S.A. 2A:34-23. In a family action, Rule 4:42-9(a)(1) authorizes the award of counsel fees and refers to Rule 5:3-5(c), which provides that a court should consider the following factors:
(1) the financial circumstances of the parties; (2) the ability of the parties to pay their own fees or to contribute to the fees of the other party; (3) the reasonableness and good faith of the positions advanced by the parties both during and prior to trial; (4) the extent of the fees incurred by both parties; (5) any fees previously awarded; (6) the amount of fees previously paid to counsel by each party; (7) the results obtained; (8) the degree to which fees were incurred to enforce existing orders or to compel discovery; and (9) any other factor bearing on the fairness of an award.In addition, while the financial circumstances of the parties is a very significant factor, if a party is found to have acted in bad faith, relative economic positions have less relevance. Yueh v. Yueh, 329 N.J. Super. 447, 461 (App. Div. 2000).
[R. 5:3-5(c).]
Here, the judge considered the relevant Rule 5:3-5 factors, and concluded that "this case cries out for attorney fees" due to Ralph's "wholly unsupportable position" regarding college costs and the lack of a reasonable, good faith or legal basis to contest equitable distribution of the land and marital home. The judge emphasized that despite receiving advice pre-trial that his positions on equitable distribution and college expenses were untenable, Ralph nonetheless proceeded in bad faith to try these issues. Accordingly, the judge ordered Ralph to pay 90% of Lynn's counsel fees and costs, for a total of $9825. In addition, because Ralph failed to reimburse Lynn for the children's college costs, as required by the FJOD, the judge assessed an additional $500 attorney's fee pursuant to Rule 1:10-3.
We are satisfied that the judge properly considered the relevant Rule 5:3-5 factors and correctly awarded counsel fees to Lynn based on Ralph's bad faith in pursuing issues that were utterly devoid of any merit whatsoever. The judge's award of counsel fees and costs to Lynn was neither a clear abuse of discretion, nor a clear error in judgment.
Affirmed. I hereby certify that the foregoing is a true copy of the original on file in my office.
CLERK OF THE APPELLATE DIVISION