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Gruber v. Rixford

May 16, 2007


On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Passaic County, FM-16-827-04.

Per curiam.


Argued October 17, 2006

Before Judges Coburn, Axelrad and R. B. Coleman.

Plaintiff Richard L. Gruber appeals from orders of the Chancery Division, Family Part, Passaic County, entered on February 25, 2005, and April 18, 2005. The February 25, 2005 order in favor of defendant Scott E. Rixford, dismissed Gruber's complaint, and discharged a previously filed notice of lis pendens. Whereas the February 25, 2005 order reserved judgment for forty-five days on the issue of Rixford's counterclaim, the April 18, 2005 order dismissed the counterclaim, without prejudice to defendant's right to re-file if plaintiff should succeed on the appeal. The dispute arises out of an alleged agreement and understanding between the parties regarding their respective interests in a townhouse in Wayne acquired during their mutually acknowledged long-term committed relationship. At issue is whether, as alleged by plaintiff, real property acquired solely in defendant's name was in actuality a joint asset in which each was to share equally in any appreciation, or whether, as defendant alleges, plaintiff was only entitled to be reimbursed money he loaned defendant to make it possible for defendant to acquire the property.

Although defendant had filed a pre-trial motion for summary judgment, the court entered an order dated December 3, 2004, that reserved decision until completion of plaintiff's case. By a separate order, also dated December 3, 2004, the court granted leave to extend discovery and party depositions were ordered to be completed by December 31, 2004. That order also filed a peremptory trial date of January 24, 2005 and memorialized plaintiff's withdrawal of any asserted claim for palimony.

Thereafter, by notice, dated January 20, 2005, defendant purported to renew his motion for summary judgment, returnable on short notice on January 24, 2005, the date for which the peremptory trial was set.

On January 31, 2005, when the trial actually commenced, the court refused to entertain the motion for summary judgment, observing that there is no provision in the rules for such a motion on short notice. The court reiterated its direction that defendant make his motion at the end of plaintiff's case. Thus, at the end of plaintiff's submission of proofs at trial, defendant again moved successfully this time, for what the trial participants characterized as summary judgment.*fn1 Because we are convinced that there existed genuine disputed issues as to material facts and that the trial court made factual findings that were impermissible at that stage of the proceedings, we reverse and remand for further proceedings. See R. 4:46-2(c) and R. 4:37-2(b).

Plaintiff and defendant were a homosexual couple who were in an on-and-off relationship between 1993 and 2002. When they first met in September 1993, plaintiff, an attorney, lived in Fort Lee and defendant, a teacher, lived in an apartment in Manhattan. Initially, plaintiff would spend nights in defendant's Manhattan apartment. Later, the lease on the Manhattan apartment was amended to add plaintiff's name. In 2000, they looked at a few properties together and on October 17, 2000, the property on Black Briar Lane in Wayne was purchased in defendant's sole name.

Defendant paid the initial deposit of $1,000, but plaintiff, who served as the closing attorney, advanced $55,000 for the down payment and closing costs. Actually, plaintiff did not pay the $55,000 directly; instead, he wired that sum to defendant's father who then wired it to defendant, ostensibly as a gift, the same day. Plaintiff also helped defendant to pay off credit card debts of between $10,000 to $15,000 so that defendant would be better qualified for a mortgage. Plaintiff also paid for an outstanding tax bill of approximately $1,300 that defendant received approximately two months after the closing.

The initial mortgage of $220,000, like the deed, was obtained solely in defendant's name and, about one year later, in 2001, the townhouse was refinanced at a lower interest rate and for a shorter term, from thirty years to fifteen. Again, the transaction was conducted solely in defendant's name; however, before the refinancing in June 2001, plaintiff alleges he provided $5,000 to pay down the principal of the mortgage.

While plaintiff made substantial financial contributions to facilitate the acquisition and improvement of the townhouse, plaintiff had significant financial and professional problems. He had failed to pay personal income taxes for years and there were substantial Internal Revenue Service (IRS) liens and civil judgments against him. Consequently, plaintiff recognized, and he was told by a bank representative, that he would not have been eligible for a mortgage and that he could not prudently take title jointly with the plaintiff. Plaintiff testified, however, that he and defendant had made a commitment to each other and that "[a]t any time I asked [defendant] he had always swore to me he would put my name on the deed." Defendant denies any such promise and denies, as well, any intent to have joint ownership of the townhouse.

After the men moved into the townhouse together in 2000, they set up what they mutually referred to as a joint account, for shared expenses including mortgage payments. Again, that account was solely in defendant's name. From October 2000 to June 2002, plaintiff and defendant contributed $4,500 and $3,500 per month respectively toward the shared expenses. However, in or about July 2002, plaintiff ceased making any contributions to the joint account.

Between early and mid-2002, the parties' romantic relationship became strained, but they continued to live together in the townhouse, and they began to discuss the unraveling of their financial interests, the repayment of plaintiff's down payment and his "investment" in the Wayne property. Toward that end, defendant wrote a letter to plaintiff, which defendant left on the breakfast table for plaintiff in May 2002, to express his views on a variety of issues. Responding to, among other things, a suggestion by plaintiff that defendant record a second mortgage in plaintiff's favor, defendant wrote:

[w]hile I never have and-nor never will-deny the initial investment you have made in this house . . . it has been many years since you personally filed income taxes [and] . . . any recorded mortgage in your favor could be attached should anything happen with the IRS for instance.

In that same letter, defendant stated that "[t]he amount of funds due to you for your personal investment in the house dating back to ...

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