On appeal from the Superior Court of New Jersey, Chancery Division, Bergen County.
Pressler and King. The opinion of the court was delivered by King, J.A.D.
This case presents the question of the power of a court to order a party to child support litigation to disclose federal income tax returns to an adverse party where he has remarried and filed a joint return with his present spouse. Following a hearing the trial judge issued an order that "the defendant shall furnish true copies of his joint 1976 federal income tax return for 1977 to plaintiff's attorneys." Defendant's present spouse objects to this procedure because it exposes her income and other financial information to plaintiff, her counsel and perhaps others. Defendant appeals asserting that the trial judge has no authority to order disclosure.
Although this appeal was not taken from a final judgment, we consider the issue presented to be important and recurrent, thereby justifying this court's interlocutory consideration. We therefore grant leave to appeal nunc pro tunc. R. 2:4-4(b)(2).
Plaintiff Judith DeGraaff and defendant Nico DeGraaff, an attorney, were married in 1964. The only child of the marriage was born in 1966. In August 1969, in contemplation of divorce and on the advice of counsel, the parties entered into a property settlement agreement which was ultimately incorporated into the final judgment of divorce entered in September 1969. Plaintiff received custody of the child and subsequently remarried in 1971.
The agreement provided for weekly child support payments by defendant. Until the child reached age ten, defendant was obliged to pay a stated weekly installment subject to periodic biannual increments. Thereafter, the agreement provided as follows:
On June 27, 1976 the child reached ten years of age. On that date defendant began payments of $75 a week, or the minimum annual sum of $3,900 called for by the agreement. After April 15, 1977 plaintiff wrote to defendant reminding him of his obligation under the agreement and requested a copy of his 1976 federal income tax return. He refused to comply, and plaintiff filed her motion to compel disclosure
pursuant to R. 4:18-1, "Discovery and Inspection of Documents."
Defendant contends that his income tax returns are confidential and are privileged from discovery by federal law. He relies on § 6103 of the Internal Revenue Code of 1954 which provides that after returns have been filed with the government, no federal employee or officer shall disclose any information revealed by the return except to the taxpayer or his representative, with certain qualifications not here pertinent. 26 U.S.C.A. § 6103.
In support of his contention defendant cites only Peterson v. Peterson , 70 S.D. 385, 17 N.W. 2d 920 (Sup. Ct. 1945), which held that a court order issued in a divorce action requiring a party to produce copies of his tax returns was void because of the "privilege" afforded by the 1939 Code's equivalent to 26 U.S.C.A. § 6103. Peterson is at best questionable authority. It cites no other supporting cases dealing with the discovery of income tax returns in matrimonial actions. The cases upon which it does rely all consider only a court's authority to order government custodians to produce income tax records. At least one other appellate court has specifically rejected defendant's argument that his remarriage and present joint-filing status affords his return an absolute privilege. Constantine v. Constantine , 274 Ala. 374, 149 So. 2d 262 (Sup. Ct. 1963).
The reason for the federal statutory protection afforded returns is stated in Annotation, "Discovery -- Income Tax Returns", 70 A.L.R. 2d 240, ...