Opinion
548 CA 20-01058
11-12-2021
Kurt E. MEHLENBACHER, Plaintiff-Appellant-Respondent, v. Stephanie MEHLENBACHER, Defendant-Respondent-Appellant.
MICHAEL STEINBERG, ROCHESTER, FOR PLAINTIFF-APPELLANT-RESPONDENT. MACHT, BRENIZER & GINGOLD, P.C., SYRACUSE (JON W. BRENIZER OF COUNSEL), FOR DEFENDANT-RESPONDENT-APPELLANT.
MICHAEL STEINBERG, ROCHESTER, FOR PLAINTIFF-APPELLANT-RESPONDENT.
MACHT, BRENIZER & GINGOLD, P.C., SYRACUSE (JON W. BRENIZER OF COUNSEL), FOR DEFENDANT-RESPONDENT-APPELLANT.
PRESENT: CENTRA, J.P., PERADOTTO, CURRAN, WINSLOW, AND DEJOSEPH, JJ.
MEMORANDUM AND ORDER
It is hereby ORDERED that the judgment so appealed from is unanimously affirmed without costs.
Memorandum: In this matrimonial action, plaintiff husband appeals and defendant wife cross-appeals from a judgment of divorce that, inter alia, distributed the marital property. We reject plaintiff's contention on his appeal that Supreme Court erred in determining that his 25% interest in Mehlenbacher Farms, LLC (LLC), was marital property. Plaintiff obtained his interest in the LLC during the marriage, and it was therefore his burden to rebut the statutory presumption that the interest was marital property (see Fields v. Fields , 15 N.Y.3d 158, 163, 905 N.Y.S.2d 783, 931 N.E.2d 1039 [2010], rearg denied 15 N.Y.3d 819, 908 N.Y.S.2d 152, 934 N.E.2d 885 [2010] ; Iwasykiw v. Starks , 179 A.D.3d 1485, 1486, 118 N.Y.S.3d 837 [4th Dept. 2020] ; Gately v. Gately , 113 A.D.3d 1093, 1093, 978 N.Y.S.2d 550 [4th Dept. 2014], lv dismissed 23 N.Y.3d 1048, 992 N.Y.S.2d 782, 16 N.E.3d 1262 [2014] ; see also Domestic Relations Law § 236 [B] [1] [c], [d] ). In light of the fact that separate property "should be construed ‘narrowly’ " ( Fields , 15 N.Y.3d at 163, 905 N.Y.S.2d 783, 931 N.E.2d 1039, quoting Price v. Price , 69 N.Y.2d 8, 15, 511 N.Y.S.2d 219, 503 N.E.2d 684 [1986] ), we conclude that plaintiff's interest in the LLC does not constitute separate property within the meaning of section 236 (B) (1) (d) (1). Despite the stated intention of plaintiff's parents to give him his interest as a gift, it is clear from the record that the LLC was formed by plaintiff, his brother, and his parents together and that nothing was actually delivered or transferred to plaintiff (cf. Hymowitz v. Hymowitz , 119 A.D.3d 736, 738-739, 991 N.Y.S.2d 57 [2d Dept. 2014] ; Spielfogel v. Spielfogel , 96 A.D.3d 443, 444, 947 N.Y.S.2d 56 [1st Dept. 2012], lv denied 21 N.Y.3d 978, 970 N.Y.S.2d 747, 992 N.E.2d 1091 [2013] ; see generally Matter of Jordan , 144 A.D.3d 1630, 1631, 41 N.Y.S.3d 850 [4th Dept. 2016], lv denied 29 N.Y.3d 908, 57 N.Y.S.3d 713, 80 N.E.3d 406 [2017] ).
Contrary to plaintiff's further contention, we conclude that defendant met her burden of establishing the value of plaintiff's interest in the LLC (see Alper v. Alper , 77 A.D.3d 694, 696, 909 N.Y.S.2d 131 [2d Dept. 2010] ; Murtari v. Murtari , 249 A.D.2d 960, 961, 673 N.Y.S.2d 278 [4th Dept. 1998], appeal dismissed 92 N.Y.2d 919, 680 N.Y.S.2d 459, 703 N.E.2d 271 [1998], cert denied 525 U.S. 1072, 119 S.Ct. 805, 142 L.Ed.2d 665 [1999] ). " ‘[T]here is no uniform rule for fixing the value of a going business for equitable distribution purposes’ " ( Lazar v. Lazar , 124 A.D.3d 1242, 1245, 999 N.Y.S.2d 626 [4th Dept. 2015], quoting Burns v. Burns , 84 N.Y.2d 369, 375, 618 N.Y.S.2d 761, 643 N.E.2d 80 [1994] ). Rather, "valuation is an exercise properly within the fact-finding power of the trial courts, guided by expert testimony" ( Burns , 84 N.Y.2d at 375, 618 N.Y.S.2d 761, 643 N.E.2d 80 ), and the court has "broad discretion in accepting or rejecting all or part of any expert testimony" regarding the value of marital property ( Madonna v. Madonna , 265 A.D.2d 455, 455, 697 N.Y.S.2d 119 [2d Dept. 1999] ; see Scully v. Scully , 104 A.D.3d 1137, 1139, 961 N.Y.S.2d 646 [4th Dept. 2013] ). Here, defendant presented expert testimony establishing the value of the assets owned by the LLC, and the court's valuation of the LLC and plaintiff's 25% interest therein was based on that expert testimony (see Madonna , 265 A.D.2d at 455, 697 N.Y.S.2d 119 ). Plaintiff presented "no expert testimony that would support a different valuation," and "[t]he determination of a fact-finder as to the value of a business, if it is within the range of the testimony presented, will not be disturbed on appeal where the valuation of the business rested primarily on the credibility of expert witnesses and their valuation techniques" ( Scala v. Scala , 59 A.D.3d 1042, 1043, 873 N.Y.S.2d 787 [4th Dept. 2009] [internal quotation marks omitted]).
We reject plaintiff's contention that the court abused its discretion in awarding $50,000 to defendant for attorney and expert witness fees (see DeCabrera v. Cabrera-Rosete , 70 N.Y.2d 879, 881, 524 N.Y.S.2d 176, 518 N.E.2d 1168 [1987] ; Haggerty v. Haggerty , 169 A.D.3d 1388, 1391, 92 N.Y.S.3d 773 [4th Dept. 2019] ). A court in a divorce action may award counsel fees and expert witness expenses to a spouse to enable that spouse "to carry on or defend the action or proceeding as, in the court's discretion, justice requires, having regard to the circumstances of the case and of the respective parties" ( Domestic Relations Law § 237 [a] ). Here, the bulk of defendant's counsel fees and expert witness expenses were incurred defending against plaintiff's separate property claim concerning his interest in the LLC.
With respect to the cross appeal, we reject defendant's contention that the court abused its discretion in setting the monthly payment for the distributive award owed to her. Defendant correctly observes that, although the court determined that the $272,831 distributive award would be paid to her over 15 years in monthly installments at five percent interest, the figure for monthly payments awarded by the court, $1,590, is inaccurate if the interest is compounded monthly. Rather than compounding the interest monthly, however, it appears that the court divided the amount of the distributive award by the total number of months to arrive at an interest-free monthly payment of $1,515. Then, in determining the monthly payment owed to defendant, the court simply added five percent of $1,515 to each monthly payment to calculate the amount awarded. A trial court has the discretion to fashion an appropriate distributive award " ‘based on what it view[s] to be fair and equitable under the circumstances’ " ( Betts v. Betts , 156 A.D.3d 1355, 1356, 65 N.Y.S.3d 842 [4th Dept. 2017], quoting Mahoney-Buntzman v. Buntzman , 12 N.Y.3d 415, 420, 881 N.Y.S.2d 369, 909 N.E.2d 62 [2009] ; see Simmons v. Simmons , 159 A.D.2d 775, 777, 551 N.Y.S.2d 997 [3d Dept. 1990] ). Based on the size of the distributive award, the nonliquid nature of plaintiff's assets, and plaintiff's ability to pay, we see no basis to disturb the monthly payment set by the court despite the unusual manner in which it calculated the interest thereon.
Contrary to defendant's further contention on her cross appeal, the court did not err in declining to award maintenance to her. "[A]s a general rule, the amount and duration of maintenance are matters committed to the sound discretion of the trial court" ( Keshav v. Singh , 175 A.D.3d 1055, 1056, 108 N.Y.S.3d 618 [4th Dept. 2019] [internal quotation marks omitted]), and we conclude that the court did not abuse its discretion in light of the size of the distributive award (see Chalif v. Chalif , 298 A.D.2d 348, 348-349, 751 N.Y.S.2d 197 [2d Dept. 2002] ). For the same reason, we further conclude that the court did not err in reducing plaintiff's child support obligation from his pro rata share of the presumptively correct amount of child support (see Holterman v. Holterman , 3 N.Y.3d 1, 13-14, 781 N.Y.S.2d 458, 814 N.E.2d 765 [2004] ; see also Domestic Relations Law § 240 [1-b] [f] ).
We have reviewed defendant's remaining contention and conclude that it does not warrant modification or reversal of the judgment.