On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Bergen County, Docket No. FM-02-2179-00.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted December 5, 2007
Before Judges Cuff and Lisa.
Defendant, Paul Sender, appeals from provisions of a post-judgment order that reduced his child support and alimony obligations and allocated the obligations of him and his former wife, plaintiff, Eileen Sender, for the education expenses of their children. Defendant argues that the judge erred by failing to order greater reductions in defendant's child support and alimony obligations and in allocating an excessive portion of the education expenses to him. We find merit in some of the arguments advanced by defendant and remand for further proceedings.
The parties married on November 15, 1987. Two children were born of the marriage, Kira on April 16, 1988, and Michael on August 18, 1990. Defendant was a medical doctor, licensed to practice medicine in New Jersey and New York. He maintained a private practice in Teaneck.
The parties divorced on November 8, 2000. Pursuant to the Property Settlement Agreement (PSA) entered into at the time of the divorce, defendant agreed to pay $2,000 per month in child support and $3,250 per month in alimony. In 1999, defendant earned $217,000*fn1 from his medical practice, and in 2000, $178,000. Although plaintiff received a small income ($10,000 in 1999) as an employee in her husband's medical practice prior to the divorce, she did not work outside the home (other than occasional part-time employment) after the divorce.
The PSA provided that plaintiff's entitlement to alimony was of limited duration and would end on August 31 of the year in which the younger child graduates from high school. The record does not reveal when Michael will graduate from high school. He will turn eighteen in August 2008. Although an individual of that age would typically graduate from high school in June 2008, plaintiff's attorney suggested at oral argument before the trial court and again in his appellate brief that Michael's graduation will be in 2009.
The PSA provided that the child support obligation was based upon the Child Support Guidelines and that:
The parties agree that child support shall continue at this same rate until the older child enters into college, at which time it shall be renegotiated, with the understanding that it will be less than the Guidelines if HUSBAND is substantially contributing to the college expenses of the older child. Similarly, there shall be further reduction and/or elimination of the child support at the time the second child enters into college.
In the years following the divorce, defendant's income from his medical practice steadily declined. In 2001, he earned $180,000, in 2002, $145,000, and in 2003, $129,000. During this time, as a result of a number of cases in which defendant's care of patients fell below acceptable standards, defendant's license to practice medicine was in jeopardy. Regulatory proceedings in New Jersey resulted in an interim consent order on July 29, 2004 providing for the surrender of defendant's New Jersey license. On September 14, 2005, the New Jersey Board of Medical Examiners suspended defendant's license for a total of five years, of which two years would consist of active suspension, with the remaining three years to be served as probation with the suspension stayed. Although the record does not contain documentation of these proceedings, it appears from a certification by defendant that the active suspension period was from September 2005 to September 2007. Defendant was also ordered to pay a $50,000 fine, which remained due at the time of the trial court proceedings.
When the interim consent order was entered on July 29, 2004, defendant was required to terminate his New Jersey practice. He obtained employment at a hospital in New York on October 1, 2004, but was terminated on February 28, 2005 because the hospital was no longer able to bill for defendant's services, as the health insurance companies no longer permitted defendant to participate in their plans as a result of the surrender of his New Jersey license. In 2004, defendant's split income from two sources ($48,000 from his practice and $30,000 from the New York hospital) totaled $78,000. In 2005, he earned $23,000 from the hospital before he was terminated, and then received $8,000 in unemployment compensation over the next twenty-six weeks, for a total that year of $31,000. Defendant's New York license to practice medicine was revoked on May 30, 2006.
Prior to the regulatory problems with defendant's license, as a result of his declining income, the parties entered into a consent order on September 9, 2003, reducing defendant's child support obligation to $1,543 per month and his alimony obligation to $2,507 per month, effective March 26, 2003.
When defendant became unemployed, he continued paying his child support, but stopped paying alimony. On June 7, 2006, plaintiff filed a motion to enforce litigant's rights. To the extent applicable to the appeal issues, she sought an order requiring defendant to pay outstanding alimony arrears which then exceeded $32,000, imputating income to defendant of $200,000 per year, and requiring defendant to pay 85% of Kira's college expenses for the upcoming school year at the University of Maryland, where Kira was about to matriculate as a freshman. On July 19, 2006, defendant cross-moved seeking, as applicable to the appeal issues, an order eliminating or reducing his alimony obligation, reducing his child support obligation, and imputing income to him of $40,000 per year. He supported the income imputation argument with the report of an employability expert, who concluded that defendant's best option to return to the labor force was to obtain employment in sales, paying $32,000 to $45,000 per year. The expert ...