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Arnold v. Anvil Realty Investment Inc.

Decided: May 23, 1989.

JOHN M. ARNOLD, PLAINTIFF-RESPONDENT,
v.
ANVIL REALTY INVESTMENT, INC., A NEW JERSEY CORPORATION, DEFENDANT-THIRD-PARTY PLAINTIFF-APPELLANT, AND FRANCES L. URNARI ARNOLD, DEFENDANT, AND LESLIE A. DIENES, THIRD-PARTY DEFENDANT



On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Middlesex County.

Antell and Brochin. The opinion of the court was delivered by Brochin, J.s.c. (temporarily assigned).

Brochin

[233 NJSuper Page 482] John M. Arnold and Frances L. Arnold were married June 24, 1978, and divorced by a judgment entered May 17, 1988. In their divorce action, the trial court entered judgment awarding Mr. Arnold damages against Anvil Realty Investment, Inc., on

the ground that its purchase of their marital home from Mrs. Arnold, its record owner, without his knowledge or consent violated property rights conferred on him by N.J.S.A. 3B:28-3. Anvil Realty has appealed from that judgment, but we agree with the trial court and therefore affirm.

On June 3, 1987, Frances Arnold, by a deed which she alone signed, conveyed the house which she and her husband had occupied as their principal marital residence to defendant Anvil Realty, for $112,000. She had inherited the property from her mother on September 15, 1980, and had conveyed record title to herself by an executor's deed on February 5, 1987. The affidavit of title which she executed and delivered in connection with the sale to Anvil Realty disclosed to the vendee that she was married to John Arnold and that a final order under the Prevention of Domestic Violence Act, N.J.S.A. 2C:25-1 et seq. and following, had been entered February 9, 1987, granting her possession of the residence to the exclusion of her husband.

John Arnold filed a complaint for divorce on February 6, 1987. When he learned of his wife's sale of their marital home, he amended his divorce complaint to add Anvil Realty as a defendant. He alleged that his wife had conveyed their marital home to Anvil Realty without his knowledge and for an unreasonably low price. He contended that its acceptance of a deed to the property from his wife alone, knowing that he and she were still married, was tortious, and he demanded rescission of the sale or damages. Subsequently, to permit Anvil Realty to dispose of the property, an order was entered dismissing the rescission claim, but preserving the claim for damages.

The trial court found that although Mrs. Arnold had inherited the house from her mother, her husband had spent his own money for renovations to the property, causing it to appreciate in value. Therefore, the court held, Mr. Arnold was entitled to a thirty-five percent interest in the house as part of an equitable

distribution pursuant to N.J.S.A. 2A:34-23. Cf. Mol v. Mol, 147 N.J. Super. 5 (App.Div.1977). The court also found that the fair market value of the house was $150,000 when it was sold to Anvil Realty for $112,000. No party to this appeal has challenged either of those determinations.

Finally, the trial court held that Anvil Realty's knowing participation in alienating the Arnold's marital home without Mr. Arnold's consent was a violation of his rights under N.J.S.A. 3B:28-3, and Anvil and Mrs. Arnold were jointly and severally liable to him for his thirty-five percent share of the difference between the $150,000 fair market value of the property and its $112,000 sales price. Judgment was therefore entered against Anvil Realty Investment, Inc., and Frances L. Arnold, jointly and severally, for $13,300 plus interest. Anvil Realty has appealed from that judgment.

N.J.S.A. 3B:28-3 states:

As to real property occupied jointly by a married person with his or her spouse acquired on or after May 28, 1980, as their principal matrimonial residence, every married person shall be entitled to joint possession thereof with his or her spouse during their marriage, which right of possession may not be released, extinguished or alienated without the consent of both spouses except by judgment of a court of competent jurisdiction. All other real property owned by either spouse which is not the principal matrimonial residence may be alienated without the consent of both parties.

This provision establishing the rights of both spouses in their "principal matrimonial residence" was enacted concurrently with the repeal of dower and curtesy.*fn1 and the adoption of a surviving spouse's elective share in the estate of a deceased spouse.*fn2 The rights of both spouses in their ...


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