Opinion
DOCKET NO. A-3476-11T3
01-09-2014
GAYLEE SCHACHTER, Plaintiff-Respondent, v. MICHAEL SCHACHTER, Defendant-Appellant.
Peter G. Bracuti argued the cause for appellant (Walder, Hayden & Brogan, attorneys; Mr. Bracuti, on the brief). Gaylee Schachter, respondent, argued the cause pro se.
NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
Before Judges Alvarez, Ostrer and Carroll.
On appeal from Superior Court of New Jersey, Chancery Division, Family Part, Essex County, Docket No. FM-07-2765-08.
Peter G. Bracuti argued the cause for appellant (Walder, Hayden & Brogan, attorneys; Mr. Bracuti, on the brief).
Gaylee Schachter, respondent, argued the cause pro se. PER CURIAM
Defendant Michael Schachter appeals from various aspects of the amended judgment of divorce entered by the Family Part on March 13, 2012. On appeal, defendant contends that the trial court abused its discretion in awarding plaintiff eighty percent of the remaining funds in the parties' retirement accounts, all of the proceeds from the sale of the marital home, and limited term alimony for four years in an amount to be determined on an annual basis. Defendant further contends that the trial court failed to address several of his other requests for relief. We have considered defendant's arguments in light of the record and applicable legal standards. We affirm.
I.
We summarize the most salient portions of the extensive testimony and evidence adduced at trial, which spanned some fifteen days between May 19, 2010, and December 13, 2010. The parties were married on June 16, 1968. They had four children, three of whom were emancipated, while the other was attending college. The parties separated in February 2008, when plaintiff left the marital home. She then filed a divorce complaint on June 5, 2008. Plaintiff was sixty-four years old at the time the divorce proceedings concluded, and defendant was sixty-five.
During the marriage the defendant worked in the jewelry business, and had a history of significant earnings. While working steadily for a variety of jewelry companies, defendant's earnings ranged between $210,000 and $250,000 per year. In 2000, defendant briefly worked for a company in California before starting a new diamond business called Diamco LLC (Diamco), with his nephew Uri Peleg, an Israeli citizen, and another individual. In June 2001, defendant and Peleg entered into a deal with an Israeli jewelry company, Fabrikant Salant (Fabrikant), as a result of which Diamco became a division of Fabrikant's subsidiary SoFaSa LLC (SoFaSa). Defendant earned $200,000 in 2001 and $250,000 in 2002, handling the sales aspect of the business, while Peleg oversaw the manufacture of the merchandise in Israel.
Throughout his career, defendant obtained patents for a variety of diamond-cutting techniques and diamond cuts. He received over $150,000 in settlements over the years after discovering violations of his patents. In late 2003, defendant discovered that Fabrikant and SoFaSa were allegedly selling one of his patented designs without permission and without paying commissions. In response, on April 30, 2004, he removed diamonds worth $4,000,000 from SoFaSa's inventory in New York City. Defendant claimed that his attorney had advised him to do this, a contention his attorney denied.
The dispute between defendant and SoFaSa went to arbitration and on April 1, 2005, the arbitrator rejected defendant's claim that he had acted on his attorney's advice. The arbitrator found that defendant had wrongfully removed the diamonds and ordered him to pay $454,000 towards SoFaSa's legal fees. A judgment was entered against defendant in the amount of $531,214. As of May 2010, this judgment, with interest, had grown to over $700,000. Defendant and Peleg subsequently retained counsel in Israel, and filed suit there against Fabrikant and SoFaSa (as well as other related entities and individuals) for, inter alia, violation of confidentiality agreements and theft of intellectual property.
Between March and September 2005, defendant worked at American Originals, another jewelry company, and earned $100,000. Plaintiff also worked there part-time for three months. Defendant claimed that plaintiff earned $2500 or $3500 per month gross at American Originals, and acknowledged that one of the reasons she was employed there was so that she would have enough quarters of employment to collect social security. Plaintiff's social security statement indicated that she earned $8275 in 2005.
In October 2005, defendant and Peleg became partners with a number of other individuals in a jewelry company called Vision Cut. In order to buy into the business, defendant and Peleg assigned all of their intellectual property (which was valued at $150,000) to Vision Cut. Defendant earned $235,000 in 2006, 2007 and 2008, which was reported as $30,000 in salary and $200,000 in consulting fees. He also received an additional $25,000 bonus in 2007. In February 2008, defendant's IRA and Keogh accounts together were worth approximately $764,000. Additionally, in 2008, defendant inherited approximately $240,000 following the death of his mother.
Plaintiff asserted, in a certification filed with the court, that defendant actually inherited $600,000 or $700,000, but no proof confirming this was presented at the trial.
Defendant received his regular salary and commissions for the first three months of 2009. In April 2009, his salary and commissions were reduced to $25,000 and $85,000, respectively. On May 1, 2009, defendant was laid off by Vision Cut.
Thereafter, defendant, who had previously undergone lumbar back surgery in 2006, activated a disability insurance policy, and received payments of $11,000 for May, June, July and August 2009. In September 2009, he began receiving regular monthly payments of $5100. This income was non-taxable. Thus, in 2009, he had $99,314 in earned income and disability payments, plus $54,000 which he withdrew from a retirement account.
In September and November 2009, and March 2010, defendant had additional surgeries on his cervical and lumbar spine. At the time of trial he was unemployed, and he claimed to be disabled and unable to work. He testified that he anticipated receiving approximately $2200 per month in social security disability retroactive to January 2010. His disability insurance payments would be reduced to $4200 per month when he began receiving his social security disability payments, and they would cease in July 2011. In light of his degenerative disc disease, he did not plan on seeking a job in the future. He explained that, while the surgeries had alleviated the sharp back and neck pain he previously experienced, he still had residual aching pain, restricted movement and nerve damage. He could not sit or walk for any extended period of time and also had trouble focusing. Defendant supported this claim with the de bene esse deposition testimony of Dr. Donald DeFabio, a licensed chiropractor who had treated him since the fall of 2009, and who had last examined him in June 2010. According to Dr. DeFabio, defendant had a limited range of motion in his cervical and lumbar spine, resulting in weakened muscles, nerve entrapment and inflammation, and residual back and neck pain. Dr. DeFabio did not believe that defendant could work any longer, although he acknowledged that, at present, defendant could still sit, stand, walk, bend, reach with his arms, and use his hands.
This amount will increase to $2700 when defendant turns seventy.
During the marriage, defendant drove luxury vehicles (four BMW's, two Jaguars, and a Porsche), while plaintiff drove expensive SUV's. Plaintiff regularly shopped at upscale stores such as Saks Fifth Avenue and Nordstrom, and the parties ate out at fine restaurants two or three times per month, as well as at other less expensive restaurants during the week. They traveled on vacations to Europe, Israel, Arizona, the Dominican Republic, and to ski out west.
Defendant represented that $256,800 per year had been required to support the parties' marital lifestyle. He acknowledged that it had cost $7433 per month (which included $5562 for the two mortgages, the real estate taxes and homeowners insurance), or $89,196 per year, just to maintain the marital residence. He admitted that after the parties separated he had opposed the sale (or rental) of the home, and that, during the pendency of the divorce, he continued to spend $14,873 per month (or $178,000 per year) to maintain his lifestyle, not including plaintiff's pendente lite support. He testified that he was currently paying $1100 per month for his car, a 2007 BMW 328.
Defendant claimed that he had spent $112,000 of his inheritance and had only $78,449 remaining in his Mijabesa account with Sovereign Bank, $8369 remaining in his TD Ameritrade account, and $44,000 in escrow with his attorney. He indicated that, as of May 16, 2010, his Merrill Lynch IRA was worth $48,205 and his Keogh account was worth $407,077, for a total of $455,282.
For her part, plaintiff, a high school graduate, had been employed as a secretary for one of the companies that employed defendant around the time that the parties first met. She stopped working when their first son was born in March 1970. Thereafter, while periodically taking time off when her second and third sons were born in 1975 and 1987, she performed general office work at her husband's business several days per week. She eventually served as the company's credit manager and, according to defendant, her maximum salary was $55,000 per year, although her social security statement indicated that she had no income from 1970 through 1980, and from 1988 through 2000. Plaintiff recalled that she ceased working altogether following the April 1990 birth of their fourth son, who required special care due to a muscle/nerve condition affecting his face and mouth that required multiple surgeries over more than a decade. Plaintiff and a friend later bought and operated a dress shop for a year or so in 1996 or 1997, but abandoned the venture when it failed to earn a profit.
Meanwhile, between November 29, 2003, and December 31, 2003, the parties deposited a substantial amount of money into their joint Merrill Lynch cash management account (the "CMA account"). Notably, this account had been substantially depleted as a result of the parties' $232,000 renovation of the marital residence throughout 2003. They refinanced the home in December 2003 by taking out an $800,000 interest-only mortgage, and received $390,109 in proceeds. They also sold the renovated Springfield house to their son Jason and deposited $256,649 into the CMA account. There was over $619,000 in the account at the end of December 2003.
Defendant variously testified that the renovation cost $232,000 or $300,000.
Thereafter, between December 2003 and October 2004, $618,000 was withdrawn from the CMA account, leaving only $805 remaining. According to defendant, $46,659.59 was paid out to finish the renovation of the marital residence. However, defendant also signed plaintiff's name to letters authorizing some eight wire transfers totaling $216,506 of these marital monies for business and litigation purposes. Defendant also signed plaintiff's name to a letter authorizing a July 6, 2004, wire transfer of $14,000 to the parties' household account, M. Schachter & Co., Inc. Additionally, defendant signed plaintiff's name on five checks totaling $69,000, drawn on the CMA account and made out to Diamco.
Although defendant initially insisted at his deposition that plaintiff actually signed all of the letters and checks, he later conceded, after she hired a handwriting expert, that she had not. He maintained, nonetheless, that plaintiff was aware of all of the parties' finances, that he had always told her when he signed checks and letters on her behalf, and that she regularly reviewed all Merrill Lynch statements and notices. Plaintiff, however, insisted that defendant forged her signature on the checks and letters without her knowledge, that she had no idea that defendant had removed these monies (which totaled $299,506.80) from the joint marital account for business and litigation purposes, and that she never reviewed the Merrill Lynch statements since defendant controlled all of their business affairs and she was only responsible for the household checking account.
The parties had taken out a $61,000 home equity line of credit in November 2004. Plaintiff moved out of the marital home and into a small apartment on February 28, 2008. She filed her complaint for divorce on June 5, 2008. Shortly thereafter, plaintiff discovered that defendant had violated their agreement not to dissipate marital assets by withdrawing $23,000 from the line of credit. She then withdrew the remaining $37,000 and deposited it into an account in her own name. Upon learning of plaintiff's actions, defendant, in June 2008, stopped paying support to plaintiff for a period of four months, instructing her to use the home equity monies instead to support herself. In July 2008, plaintiff utilized $7000 of these monies to pay her bills.
Also in July 2008, plaintiff filed a motion for pendente lite relief seeking, among other things, to compel the sale of the marital residence notwithstanding defendant's objection. The court denied that relief without prejudice on October 3, 2008. In April 2009, defendant's girlfriend of one year moved into the home. She paid no rent but did contribute $1100 to $1300 per month toward utilities, insurance and food. That same month, she and defendant formed a new company, although they maintained that it did no business and generated no income. In July 2009 plaintiff filed a new motion, this time to compel defendant to rent out the marital home, and other relief. Defendant cross-moved for permission to buy out plaintiff's share of the home for $40,000. Both applications were denied.
On October 8, 2010, defendant sold the marital home at auction for $900,000. The vast majority of the proceeds went to satisfy the $826,475 first mortgage and the $61,820 home equity line. The net proceeds of $1709.86 were placed in an escrow account because of the lien on the house due to the judgment against defendant. Defendant and his girlfriend subsequently rented a two-bedroom, two-and-one-half-bath townhouse, with a two-car garage, for $2700 per month. Plaintiff, in contrast, testified that she was paying $1390 per month for her one-bedroom apartment.
Plaintiff noted that defendant sold the home only after the court indicated that there be no more withdrawals from the retirement account to pay her support.
According to plaintiff, her sole income was a $380 check every month from Social Security. Her IRA had been completely depleted to pay legal bills, and she had also spent all the home equity monies that had been in her possession. She stated that she lived hand-to-mouth and could not afford to go on vacation or even join a synagogue. She represented that, while the marital lifestyle had been between $20,000 and $21,000 per month, as acknowledged by defendant, she was presently only looking for enough money to "exist." Plaintiff reported that she was relatively healthy and had once again been looking, albeit unsuccessfully, for a job either in retail or as a caregiver both online and in person at the Short Hills Mall and other stores, as well as through the synagogue in town.
Plaintiff admitted to spending $1500 on spa treatments, as defendant contended.
With respect to defendant's assets, she maintained that, as of June 30, 2010, his IRA was worth $36,244 and his Keogh account was worth $442,898, for a total of $479,142. She expressed confidence that defendant, with his successful work history, could find new employment, particularly since he loved the diamond industry and his affluent lifestyle and had connections all around the world. She did not believe that his back problems would hinder him since his work was largely sedentary and he typically worked out of the house several days per week. She supported her position through the de bene deposition testimony of her own medical expert, Dr. Arthur Canario, an orthopedic surgeon, who concluded that there was no medical reason why defendant could not continue to work as a diamond dealer since this was not a strenuous job.
Plaintiff also claimed that, before she left the marital home, she discovered jewelry rolls and diamond boxes containing at least $375,000 in loose diamonds and gold chains under the floorboards in the parties' bedroom closet. She presented two rings that she allegedly removed from the stash. While she was not presently seeking a share of this jewelry, she maintained that her discovery confirmed that defendant had other resources and ways of making money. Defendant admitted that, for a time, he kept diamonds and other jewelry under a moveable floorboard in the closet, but insisted that he had long since sold all of those items and that there was presently nothing left.
Plaintiff maintained that she should not be held responsible for the $700,000 judgment against defendant since he had engaged in wrongdoing without her consent. She further asserted that defendant owed her back medical expenses totaling $14,966.19.
On December 20, 2011, the court entered a basic dual final judgment of divorce. In an accompanying oral decision, the court found that this was a long-term marriage and that the parties had lived an upper middle class lifestyle, spending $20,000 to $21,000 per month. They took frequent, expensive vacations, dined in fine restaurants, shopped in upscale stores, drove luxury cars, and resided in lavish homes that they either built or extensively remodeled. Defendant was the primary wage earner, with annual income of several hundred thousand dollars per year, while plaintiff was largely a homemaker who worked only periodically on a part-time basis at defendant's diamond business and in several other short-term ventures. The court noted that, according to plaintiff's social security statement, she had no income from 1970 through 1980 and from 1988 through 2000, and only limited income in 2001 ($1316), 2002 ($1675), and 2005 ($8275).
The court observed that, on April 1, 2005, the arbitrator found that defendant had wrongfully misappropriated $4,000,000 worth of diamonds that belonged to SoFaSa and ordered him to pay $454,000 towards SoFaSa's legal fees. The judge further noted that the arbitrator had found defendant not credible. A judgment was entered against defendant that, with accrued interest, presently totaled some $700,000. Defendant subsequently spent hundreds of thousands of dollars of marital monies to bring suit against his former employer and business partners in Israel.
According to the court, the assets subject to equitable distribution included: (1) the proceeds from the sale of the marital home which totaled $1709.86; (2) the $405,000 remaining in defendant's two retirement accounts (his IRA and Keogh account) as of June 2010; (3) the $860 remaining in the parties' joint CMA account; (4) the parties' jewelry; (5) miscellaneous personal property; and (6) any potential recovery in the Israel litigation. The court first awarded all of the proceeds from the sale of the marital home to plaintiff based upon its findings that: (1) most of the proceeds went to "pay off the mortgage . . . and liens" on the home; and (2) defendant's wrongful conduct in taking $4,000,000 of assets belonging to SoFaSa deprived plaintiff "of her share of what would have been net equity in the home, if . . . any had existed when the home was sold." The court observed that there were creditors who had judgments against defendant who were seeking a portion of the proceeds.
Next, the court found that plaintiff was entitled to eighty percent of the monies remaining in defendant's two retirement accounts ($324,000) based upon: (1) defendant's wrongful conduct in taking $4,000,000 of assets belonging to SoFaSa which precipitated expensive litigation that depleted the parties' assets and resulted in a lien against the marital home; (2) defendant's dissipation of marital monies held in the joint CMA account without plaintiff's knowledge or consent; (3) defendant's unreasonable refusal to sell the marital home (which cost $89,000 to maintain annually) for over two years during the pendency of the divorce, thereby further dissipating marital assets; and (4) its decision regarding alimony. The court was satisfied that defendant had deprived plaintiff of what would have been a nest egg for her later years by signing her name to checks and wire transfers drawn on the CMA account without her knowledge. The court also awarded plaintiff the entirety of the $860 remaining in the CMA account based upon defendant's wrongful depletion of this account.
The court ruled that plaintiff's "engagement ring" was exempt from equitable distribution except to the extent that she had used $10,000 of marital monies to acquire a more valuable substitute ring. Defendant was accordingly entitled to a $5000 credit for the engagement ring, as well as a second $5000 credit representing the difference in value between his jewelry and plaintiff's other jewelry. The court further ruled, without explanatory comment, that all remaining personal property was to either be divided on an equal basis or sold with any proceeds to be split equally. Finally, the court determined that any recovery in the Israel litigation was also to be divided equally.
Regarding alimony, the court first found that this was a long-term marriage, and that plaintiff had need of a support award because of her "minimal ventures" into the workforce over her lifetime, her limited education, experience and skills, and her age (sixty-four). Although plaintiff could obtain some training, her ability to become employed was limited. Defendant, by contrast, was a successful businessman in the diamond industry whose earnings had allowed his family to enjoy an affluent lifestyle for decades. Additionally, while plaintiff had been awarded the bulk of the parties' remaining marital assets, these assets were relatively meager due to defendant's wrongful conduct.
However, the court recognized that defendant was now sixty-six years old, had undergone multiple back surgeries, and had been declared disabled for social security purposes and was therefore entitled to a rebuttable presumption that he could no longer work. Nonetheless, the court concluded that the evidence established that defendant was not prevented by his physical condition from continuing to work in the diamond industry in some capacity, and that, had the parties remained married, defendant would have worked until age seventy. The court believed that defendant was a resourceful person who was attached to his upscale lifestyle and that he would somehow find a way to fund that lifestyle going forward. It noted that defendant's lifestyle was far superior to plaintiff's during the pendency of the litigation, and that he had recently made several trips to jewelry tradeshows and had also started a new business with his girlfriend.
The court found itself unable to set a specific amount of monthly alimony since, at that time, defendant was on a fixed income. Accordingly, the court directed defendant to continue paying the previously-ordered pendente lite support to plaintiff until the retirement assets were distributed. At that point, that support obligation would terminate and defendant would thereafter be required to pay plaintiff thirty percent of any income he earned until he reached age seventy. The court required that defendant prove his income by providing copies of his tax returns to plaintiff's counsel and also filing copies with the court on or before May 1st of each year.
The court also ordered defendant to pay $15,000 towards plaintiff's unreimbursed medical expenses based upon the receipts submitted by plaintiff at trial. It also indicated that it intended to award some amount of counsel fees to plaintiff following its review of counsel's Affidavit of Services.
On March 13, 2012, the trial court entered an Amended Dual Final Judgment of Divorce which incorporated the particulars of the court's oral decision. The judgment specifically provided that plaintiff would only be entitled to alimony for 2011, 2012, 2013 and 2014, and that she was not responsible for the judgment against defendant. The court also entered judgments against defendant: (1) in the amount of $14,400 for unpaid support for November 2011 through February 2012; and (2) in the amount of $6743.36 for unpaid medical premiums for March 2011 through December 2011. On October 3, 2012, the trial court issued an order, with an appended statement of reasons, awarding plaintiff $9338.50 in counsel fees. This appeal followed.
II.
"Generally, the special jurisdiction and expertise of the family court requires that we defer to factual determinations if they are supported by adequate, substantial, and credible evidence in the record." Milne v. Goldenberg, 428 N.J. Super. 184, 197 (App. Div. 2012). This court owes "particular deference" to the family courts because of their "special jurisdiction and expertise in family matters." Ibid. (quoting Cesare v. Cesare, 154 N.J. 394, 413 (1998)). Such deference will be "disturbed only upon a showing that the findings are 'manifestly unsupported by or inconsistent with the competent, relevant[,] and reasonably credible evidence' to ensure there is no denial of justice." Ibid. (quoting Platt v. Platt, 384 N.J. Super. 418, 425 (App. Div. 2006)).
"The Family Court possesses broad equitable powers to accomplish substantial justice." Finger v. Zenn, 335 N.J. Super. 438, 446 (App. Div. 2000), certif. denied, 167 N.J. 633 (2001). This court "accord[s] great deference to discretionary decisions of Family Part judges." Milne, supra, 428 N.J. Super. at 197. Such discretion "takes into account the law and the particular circumstances of the case before the court." Ibid. (internal quotation marks omitted). This court, however, will not defer to a family court's decision where the court abused its discretion. See, e.g., State ex rel. J.A., 195 N.J. 324, 340 (2008). "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. Milne, supra, 428 N.J. Super. at 197 (quoting Flagg v. Essex Cnty. Prosecutor, 171 N.J. 561, 571 (2002)). The family judge's legal decisions are subject to this court's plenary review. Crespo v. Crespo, 395 N.J. Super. 190, 194 (App. Div. 2007).
Family "judges are under a duty to make findings of fact and to state reasons in support of their conclusions." Heinl v. Heinl, 287 N.J. Super. 337, 347 (App. Div. 1996); see R. 1:7-4(a). "'Meaningful appellate review is inhibited unless the judge sets forth the reasons for his or her opinion.'" Strahan v. Strahan, 402 N.J. Super. 298, 310 (App. Div. 2008) (quoting Salch v. Salch, 240 N.J. Super. 441, 443 (App. Div. 1990)). "Naked conclusions do not satisfy the purpose of [Rule] 1:7-4. Rather, the trial court must state clearly its factual findings and correlate them with the relevant legal conclusions." Curtis v. Finneran, 83 N.J. 563, 570 (l980).
A. Equitable Distribution
With these principles in mind, we first address defendant's contention that the trial court erred in its distribution of the marital assets. He argues that the trial court's inequitable division of these assets was based on its erroneous findings that: (1) the judgment against defendant deprived plaintiff of her share of the net equity in the marital home; (2) defendant's delay in selling the marital residence forced the needless expenditure of marital monies; and (3) defendant depleted marital assets by signing plaintiff's name to certain checks and wire transfers. Defendant also insists that the trial court failed to properly factor in plaintiff's removal and "dissipation" of $37,000 from the home equity line of credit. We disagree.
The goal of equitable distribution is to bring about a "fair and just division of marital assets." Steneken v. Steneken, 183 N.J. 290, 299 (2005) (internal quotation marks and citation omitted). When distributing marital assets, a court must, (1) identify the property subject to equitable distribution; (2) determine the value of each asset; and (3) decide how to allocate each asset most equitably. Rothman v. Rothman, 65 N.J. 219, 232 (1974). "In every case, . . . the court shall make specific findings of fact on the evidence relevant to all issues pertaining to asset eligibility or ineligibility, asset valuation, and equitable distribution . . . ." N.J.S.A. 2A:34-23.1. A court should apply all the factors set forth in N.J.S.A. 2A:34-23.1, and distribute marital assets consistent with the parties' unique needs. DeVane v. DeVane, 280 N.J. Super. 488, 493 (App. Div. 1995). "Equitable" does not necessarily mean "equal." Rothman, supra, 65 N.J. at 232 n.6. An appellate court will affirm an equitable distribution 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).
Here we conclude that the trial court's decision to award plaintiff eighty percent of the retirement assets was not a mistaken exercise of discretion. In doing so, the court, among other reasons, cited defendant's wrongful conduct in (1) taking $4,000,000 in diamonds belonging to SoFaSa which precipitated expensive arbitration and litigation, and (2) signing plaintiff's name to certain checks and wire transfers. Both of these actions had resulted in the substantial depletion of the parties' marital assets. The trial court's conclusions are adequately supported by substantial credible evidence in the record. Defendant admitted that he forged plaintiff's signature on checks and letters that resulted in the release of at least $299,506.80 from the joint CMA account for defendant's business and litigation purposes. The court was entitled to accept plaintiff's claim that she had no knowledge of these transfers. Where one spouse has "dissipated the marital assets, or otherwise disposed of them in fraud of the other," a court properly imposes a debt on the dissipating "spouse in favor of the other." Kothari v. Kothari, 255 N.J. Super. 500, 510 (App. Div. 1992).
Defendant further argues that because only $360,109.43 remained in his retirement "account" in April 2012, plaintiff's award of $324,000 amounted to 90%, rather than the specified 80%, of the account (a $36,000 difference). The record does not support this argument. In advancing this contention, defendant ignores that by deciding to value the two retirement accounts as of June 2010, the court essentially forgave the $105,000 defendant was permitted to withdraw from the accounts for his own and plaintiff's support in 2009 and early 2010, which amounts were supposed to be credited against his share of equitable distribution. In any event, our review of the record indicates that as of June 2010, defendants' two accounts were actually worth $479,142, rather than $405,000 as found by the trial court, so that plaintiff actually received $59,313 less than eighty percent. Additionally, it appears that defendant has improperly omitted the value of his IRA in making his unsubstantiated claim that his "account" was worth only $360,109 in April 2012. Notably, plaintiff was awarded eighty percent of the combined value of both of defendant's retirement accounts, not just the Keogh account.
The trial court also distributed the entire net proceeds from the sale of the marital home to plaintiff. While we disagree with the trial court's reference to the lien of the outstanding judgment against defendant, since it does not appear to have lessened the amount of the net proceeds the parties received, we nonetheless view the other factors cited by the judge as sufficient to justify this award. In addition to defendant's dissipation of assets, the court was wholly justified in finding that his opposition to the sale of the marital home in 2008 forced the needless expenditure of large sums of marital monies. Moreover, at the time of its sale the marital home was virtually worthless, netting only $1709.86 from its $900,000 sales price. Were defendant's position adopted, i.e., that these net proceeds should have been divided equally, the difference in the amount received by plaintiff would have been $845.93. While we hesitate to characterize this relatively insignificant amount as trivial, it hardly warrants a more extended discussion.
We similarly find to lack merit defendant's insistence that the trial court failed to properly factor into its equitable distribution decision plaintiff's removal and "dissipation" of $37,000 from the home equity line of credit. Here again defendant ignores that: (1) he first drew upon this line of credit without advising plaintiff and in violation of their agreement not to touch these monies; (2) he never accounted for the $23,000 he took; (3) he stopped paying support to plaintiff for a period of four months and directed plaintiff to use the money she withdrew to support herself; and (4) plaintiff testified that she did, in fact, use the monies for her own support and to pay her attorney. Given these facts, there was no reason for the court to have taken plaintiff's withdrawal into consideration in making its equitable distribution award.
Finally, defendant argues that the trial court failed to make necessary findings of fact in support of its distribution of the parties' remaining personal property, and also did not consider defendant's exempt property. Defendant prepared a list of all remaining undistributed personal property. However, the only item he identified as exempt was a Rosenthal vase of unidentified value, which he claimed he received as part of his mother's estate. Plaintiff however, testified that there were two Rosenthal vases, and that they were not part of his mother's estate, but gifts given to both parties during the marriage. Plaintiff expressed her willingness to split all of the items on the list with defendant, including the vases, or to sell the items and split the proceeds. Since defendant failed to prove that any of the items were in fact exempt, and plaintiff's approach was more than reasonable (particularly since most of the items on the list do not appear to have been valuable), the court's decision to adopt plaintiff's approach was appropriate.
B. Alimony
Defendant contends that the trial court erred in awarding plaintiff alimony. He argues that the trial court improperly ordered a "hypothetical alimony amount based upon defendant's potential hypothetical earnings without regard to plaintiff's need" and without determining precisely what type of future income defendant would have to share with plaintiff. He further asserts that the court failed to make the necessary findings regarding the marital lifestyle, plaintiff's need for support, and her ability to contribute toward that need. Again we disagree.
Alimony is a claim arising upon divorce, which is rooted in the prior interdependence occurring during the parties' marital relationship. "[A]limony is neither a punishment for the payor nor a reward for the payee." Mani v. Mani, 183 N.J. 70, 80 (2005) (citations omitted).
In Mani, supra, the Court traced the history of alimony, concluding today's awards reflect the "economic right . . . aris[ing from] the marital relationship[,]" 183 N.J. at 78-80, designed to give a financially dependent spouse "'a level of support and standard of living generally commensurate with the quality of economic life that existed during the marriage.'" Id. at 80 (quoting Stiffler v. Stiffler, 304 N.J. Super. 96, 99 (Ch. Div. 1997)); see also Crews v. Crews, 164 N.J. 11, 24 (2000) (holding the goal of an alimony award is to allow the dependent spouse the ability to continue the standard of living established during the marriage (citation omitted)).
It has long been held that alimony is awarded because of an "actual economic dependency" and not because of one's status as a spouse. Lepis v. Lepis, 83 N.J. 139, 155 (1980). The Legislature delineated considerations to be weighed when reviewing a claim for alimony. See N.J.S.A. 2A:34-23 (detailing a non-exclusive list of factors considered when determining whether to award alimony). Consequently, the statutory factors emphasize facts reflecting need and the ability to pay. Resolving whether a dependent spouse can continue to provide for his or her support at "[t]he standard of living established in the marriage[,]" N.J.S.A. 2A:34-23b(4), requires a trial court to assess the current financial earnings and assets of each party, and consider each person's future ability to earn and contribute to his or her support.
Here, the judge enumerated the factors set forth in N.J.S.A. 2A:34-23b. Contrary to defendant's contentions, the court's oral decision clearly set forth its findings that this was a marriage of long duration, that the parties lived an upper middle class lifestyle, that plaintiff was in dire need of support, and that she could not contribute to her own support in any significant way. Nonetheless, in recognition of defendant's age and disability, the court declined to award permanent alimony or, indeed, alimony in an amount commensurate with the marital lifestyle. Rather, the court simply awarded plaintiff thirty percent of all gross income "earned" by defendant for a period of four years based upon its entirely reasonable finding that defendant would seek out some limited employment to supplement his income. The court in no way suggested that defendant would have to pay plaintiff thirty percent of any income derived from previously distributed assets. Although defendant suggests otherwise, there exists little likelihood that this small award, which was of short duration and no way guaranteed, could ever exceed plaintiff's need, given her age, meager social security payment, and limited employability. Further, when defendant reaches age seventy, plaintiff will have no alternative but to rely on equitable distribution proceeds to support herself.
The court has great latitude in crafting an appropriate alimony award. See Steneken v. Steneken, 367 N.J. Super. 427, 434-35 (App. Div. 2004), aff'd in part and modified in part, 183 N.J. 290 (2005). While outside the norm, under the facts present here, the judge did not abuse her discretion in crafting this alimony award. Nor do we see how defendant is unfairly prejudiced, since if he is unable to work, as he contends, he will have no earnings to share with plaintiff.
C. Counsel Fees
Defendant next argues that the trial court erred in awarding an unspecified amount of counsel fees to plaintiff without engaging in the required analysis. He further contends that the award was purely punitive in nature based upon the court's misperception that he had engaged in wrongdoing during the marriage and caused the depletion of marital assets both during the marriage and during trial. We do not agree.
At the conclusion of her December 20, 2011, oral decision, the judge addressed the matter of counsel fees, as follows:
Finally, with regard to counsel fees. This has been an expensive litigation for both parties. Unfortunately, they didn't have a whole lot of assets or income to work with and, unfortunately, through the course of this litigation they have depleted some of those assets to . . . fund their . . . litigation.
I find that the defendant's conduct during the marriage . . . [and] during the pendency of this litigation . . . led to a depletion of marital assets . . . depriving plaintiff [of] . . . a nest egg, in the sense of having equity from the marital home that she [could] . . . live on for the next several years[.] . . . [H]e's deprived her of all that. [I further find] [t]hat he was the primary wage earner during the . . . marriage[, and] [t]hat she was limited in her skills and training [and] [r]eally didn't work and was not a main contributor, financially, . . . in the marriage. [As such,] . . . he is going to be responsible for a portion of her attorney fees. And I will . . . go through [the most current affidavit of services] and I will issue a separate Order with that amount that he's going to pay towards plaintiff's attorney fees.
On February 11, 2011, plaintiff's counsel submitted an updated certification of services indicating that plaintiff had been billed a total of $176,343.89 in fees and costs, of which $107,500 had been paid, leaving a balance of $68,843.89. Of the amount paid, $15,500 had been paid by defendant, $25,000 had been withdrawn from a marital asset (defendant also was permitted to take $10,000 from a marital asset), and $67,000 was paid by plaintiff who liquidated her IRA retirement account.
On October 3, 2012, the trial court issued an order awarding plaintiff $9338.50 in counsel fees. In an appended statement of reasons, the court identified the factors it was obliged to consider. It then found that: (1) plaintiff, who was unemployed despite good faith efforts to find a job, had minimal income and had already depleted her IRA in order to pay some of her legal fees, had no ability to pay the remainder of her fees; (2) defendant, who continued to live a more upscale life than plaintiff as evidenced by his residence in a roomy townhouse and payments of $1100 per month towards a BMW, did have the ability to pay since he had greater employment resources, a much larger income (even on disability), and access to non-marital inheritance monies; and (3) plaintiff had been forced to incur certain pre-trial fees because of motions filed by, and other positions taken by, defendant that were unreasonable and in bad faith. The court explained:
Defendant during the course of this litigation caused plaintiff to incur fees because of his conduct. For instance, he stopped paying plaintiff support forcing her to file a motion for pendente lite support, which resulted in the October 3, 2008 Order that granted her interim support. Defendant filed a motion to terminate support which was denied by the court in an order dated July 17, 2009. Another example is defendant's position pre-trial that plaintiff had signed checks authorizing withdrawals in the approximate amount of $344,000 from the parties' joint account. Because of defendant's false assertion, plaintiff had to incur legal fees to retain a handwriting expert and to refute that untruthful allegation. Even though defendant changed his position at the time of trial, plaintiff still had to incur those pre-trial litigation fees.
Accordingly, the court ordered defendant to pay the fees incurred by plaintiff: (1) for her pendente lite support motion; (2) in opposing defendant's motion to terminate support; and (3) to refute defendant's false claim that plaintiff had signed checks for withdrawals from the parties' joint account. The court noted that "[t]hese fees are all directly related to defendant's wrongful act or lack of action and therefore, defendant and not plaintiff should bear the legal cost of same." The court reiterated that defendant was in a better financial position than plaintiff to pay these fees "especially since they are [the] direct result of his conduct of unilaterally stopping support, seeking to terminate support after it was ordered by the court and making false claims as to withdrawals from the parties' joint account[]."
A judge in a matrimonial action may award a party reasonable attorney's fees and costs, and in making that determination "shall 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; see R. 5:3-5(c). The decision to award counsel fees "in a matrimonial action rests in the discretion of the trial court[,]" Addesa v. Addesa, 392 N.J. Super. 58, 78 (App. Div. 2007), and will be disturbed "only on the 'rarest occasion,' and then only because of clear abuse of discretion." Strahan, supra, 402 N.J. Super. at 317 (quoting Rendine v. Pantzer, 141 N.J. 292, 317 (1995)).
We find the trial court's findings amply supported by the record. Given our deferential standard of review, we find no error in the court's limited counsel fee award.
D. Unaddressed Prayers for Relief
Finally, defendant contends that the trial court failed to address many of his requested prayers for relief, and/or made inadequate findings. While the court did not address various of these claims, most of which sought monetary reimbursement from plaintiff, we conclude that they lack sufficient merit to warrant extended discussion, Rule 2:11-3(e)(1)(E), and that reversal on this basis is not warranted. We only add the following comments as to certain of these claims.
Defendant argues that the trial court "ignored" his request for a retroactive reduction of his pendente lite obligation due to his "prolonged disability and inability to work." Defendant is correct that, under Mallamo v. Mallamo, 280 N.J. Super. 8, 12 (App. Div. 1995), pendente lite support orders are subject to modification prior to the entry of final judgment. However, any retroactive reduction would be entirely inappropriate in this case. While it is true that defendant lost his job, decided to activate a disability insurance policy, and was ultimately declared disabled for social security disability purposes, it cannot be overlooked that at the same time defendant: (1) unilaterally chose to continue residing in a home that cost some $90,000 per year to maintain; (2) paid $3997 towards the primary mortgage on that home, none of which reduced the principal balance, and which amount exceeded plaintiff's base support; (3) admittedly spent a total of $14,873 per month to fund his lifestyle alone through October 2010 when the marital home was sold; and (4) included in that lifestyle payments of $1100 towards his BMW. Moreover, it again bears noting that defendant depleted the parties' retirement accounts in order to preserve his lifestyle and pay plaintiff's pendente lite support. Since the court elected to value these accounts, for equitable distribution purposes, as of June 2010 and not some earlier date, defendant was thus not penalized for his wasteful management of the parties' money.
Next, defendant contends that the court "fail[ed] to address defendant's immune assets within its findings regarding equitable distribution." However, plaintiff was not awarded any of defendant's inherited monies. To the extent that defendant is suggesting that he was entitled to some reimbursement of inheritance monies he paid out pendente lite, we cannot agree. The record reflects that defendant was repeatedly permitted, subject to an accounting at the end of the case, to use joint retirement monies, not inheritance monies, to pay plaintiff's support and to fund his own unreasonably expensive lifestyle. That accounting does not appear to have transpired. Given defendant's depletion of the retirement accounts pendente lite, as well as his earlier depletion of the CMA account, and plaintiff's limited means, plaintiff was under no obligation to reimburse defendant for any portion of the inheritance monies he chose to spend for whatever purpose during the pendency of this case.
Although defendant also finds it "troubling" that the trial court, following a post-judgment motion, directed the release to plaintiff of a portion of his escrowed inheritance monies to pay support arrears and owed medical premiums, he has not appealed from the relevant order of May 8, 2012, and offers no actual argument in support of his position.
--------
Finally, defendant contends that the trial court erred in failing to exclude plaintiff's jewelry expert's opinion as to value as a net opinion. Our scope of review of a trial judge's evidential rulings requires that we grant substantial deference to the judge's exercise of discretion. State v. Morton, 155 N.J. 383, 453 (1998). Rulings on evidence will not provide a basis for reversal unless they reflect an abuse of that discretion. Benevenga v. Digregorio, 325 N.J. Super. 27, 32 (App. Div. 1999), certif. denied, 163 N.J. 79 (2000). Reversal is not warranted unless the trial judge's ruling was "so wide of the mark that a manifest denial of justice resulted." State v. Carter, 91 N.J. 86, 106 (1982). Here plaintiff's expert possessed the necessary qualifications, and he explained his method of valuing plaintiff's jewelry. In short, he "g[a]ve the why and wherefore" of his opinion. See Jimenez v. GNOC, Corp. 286 N.J. Super. 533, 540 (App. Div.), certif. denied, 145 N.J. 374 (1996).
Affirmed.
I hereby certify that the foregoing is a true copy of the original on file in my office.
CLERK OF THE APPELLATE DIVISION