On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Morris County, FM-14-1446-04.
The opinion of the court was delivered by: C.L. Miniman, J.A.D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted: October 15, 2007
Before Judges Stern, A.A. Rodríguez and C.L. Miniman.
In this quintessential palimony action, defendant Edward Diehl appeals from a December 6, 2005, judgment in favor of plaintiff Rosemary Connell awarding $107,494.40 in palimony, $70,000 as a return of an inheritance Connell received in 1997 and gave to Diehl and $15,000 in counsel fees, less a partial payment of $36,000 from Diehl to Connell after they separated. Connell cross-appeals from the quantum of the award. We affirm the judge's conclusion that Connell is entitled to palimony, but reverse the quantum of the award and remand for reconsideration of the award by the trial judge.
Connell is currently sixty-one years old and suffers from Stargardt's disease, a juvenile form of macular degeneration, which she has had since she was thirteen years old. She is legally blind, having only peripheral vision. Connell is a high school graduate and collects Social Security disability benefits, which began in 1973. When she was in her early twenties, Connell married Brian Connell and on June 8, 1970, a son, Brian Connell, Jr., was born. That year Connell and her husband divorced and she received permanent alimony of $20 every other week as well as weekly child support.
In 1972 Diehl met Connell through a dating service and they dated for two and one-half years. In 1974 they began to discuss cohabitation. Connell's parents did not want her and Diehl to live together unmarried, so she told Diehl that it would be humiliating to cohabitate without getting married. Diehl told Connell, "It isn't necessary to have a piece of paper when two people want to be together. You can have the same commitment. Honey, you know me, I would never abandon you. You don't need anything like that." Connell testified that she thought it would be okay. Diehl then told Connell that they would tell everyone that they were married, she would have a ring, nobody would know they were not married and it was no one's business anyway. Diehl gave Connell a fourteen-karat gold ring with three garnets, which was inscribed, "Always." Diehl, Connell and Brian, Jr., then began living together in an apartment in Maywood.
Once Connell and Diehl began cohabitating and telling everyone that they were married, Connell's former husband ceased making alimony payments. Connell never disputed the termination of alimony. Diehl introduced Connell to everyone as his wife and Brian as his son. Connell began to use Diehl's last name, which at that time was Pojedneck. When Diehl changed his last name, Connell began using "Mrs. Diehl." Connell's parents were the only people, except for medical providers, who came to know that the two were not legally married. Connell's cousin, Marilyn Pieretti, even sent Connell and Diehl a 25th wedding anniversary card addressed to "Mr. and Mrs. Diehl."
After they began to live together, Diehl started investing in residential real estate. Over the years Diehl acquired a number of apartment buildings, which by the time of this action contained a total of twenty-six units. Diehl's tenants all paid their rent in cash with the lowest rent being $473 and the highest being $800 per month. Diehl deposited this rental income into the joint checking account with Connell to pay their bills. Connell learned Spanish to help communicate with current and prospective tenants. She screened prospective tenants calling about vacant units and generally maintained Diehl's business calendar. Connell answered late-night calls from tenants, cleaned apartments after they were vacated and waited in empty apartments for handymen and utility workers to arrive. Diehl told Connell that the residential real estate investments were for their future retirement.
In the early 1980s Diehl purchased a stuffed-potato concession stand in East Brunswick. Connell also worked at the stand, helping where she could by scrubbing potatoes, cleaning the steam table, taking out the garbage and cleaning the soda machine. Thus, Connell assisted Diehl in all of his business ventures.
Connell used the child support payments she received and her Social Security disability benefits to purchase food for the family. When the Social Security Administration discontinued issuing checks, Connell opened a bank account for direct deposit of her disability benefits. Connell and Diehl also maintained joint banking accounts at PNC Bank. During the entire time they lived together, Diehl was the primary financial support for Connell and Brian. Connell did not work outside the home but contributed to the family by working in Diehl's business endeavors and performing household duties, such as cleaning, cooking and laundry. During their thirty-year relationship, Diehl provided for Connell in his estate plans. Ultimately, he executed a last will and testament in 1990 that made her the sole beneficiary of his estate.
In 1978 Connell and Diehl began searching for a single-family home. They looked at potential homes together. While Connell liked all the homes that they saw, Diehl ultimately choose the home that he liked best, which was located in Lincoln Park. Diehl referred to the home as "our home," but title was in his name alone. Connell never thought about the fact that her name was not on the title of their Lincoln Park home because, "I didn't have any insecurity at all being with [Diehl]. I just -- I just totally believed that he was taking care of me and always would."
After moving into the Lincoln Park home, Diehl continued to fully support the family. Connell continued to use child support and Social Security disability benefits for the family's food. Connell continued to contribute by performing household chores such as cooking, cleaning and laundry. Connell also decorated the family's home. Although they made joint decisions on carpeting and furniture choices, Connell picked out curtains, pictures, mirrors, plants and other decorations by herself.
At some point Diehl made an arrangement with Connell's former husband that permitted Diehl to claim Brian as a dependent on Diehl's income tax returns every other year. In 1987 after Connell's former husband died and the child support money ceased, Diehl claimed Brian on his tax returns annually until Brian was eighteen. Connell was never required to file income tax returns due to her low level of income. Because of her limited eyesight, she has never had a driver's license. Therefore, Diehl was her primary source of transportation.
Diehl and Brian had a very good relationship. Brian admired Diehl and considered him to be his father. Brian never showed Diehl any lack of respect and there was never any fighting or arguing between them. Diehl attended Brian's school events and drove him to places he needed to go. Diehl also attended Brian's high school graduation. Connell, Diehl and Brian ate their dinner meals together every night. Over the years, Connell, Diehl and Brian took family vacations together, and Connell and Diehl would also take vacations with each other, some outside the United States. Diehl paid for all of the vacations. They spent holidays together, and were always together for other family events such as weddings, christenings, birthday parties, anniversary parties and other family parties. Connell and Diehl gave joint gifts, signing the cards, "Mr. and Mrs. Pojedneck" or "Mr. and Mrs. Diehl," just as the invitations had been addressed.
When Connell's mother died in 1997, her father having died years earlier, Connell received an inheritance of $70,000, which she gave to Diehl to pay for various household items and some major home remodeling. Diehl placed the money in a joint Scudder account, but then moved it to an account in his name only. Diehl used the money for office equipment consisting of a computer, scanner, printer, desk and chair; a complete remodeling of the kitchen including all new appliances; new landscaping; and new household furniture for the living room, dining room and breakfast nook. The remainder of the inheritance money went into an investment account in Diehl's name alone.
Connell and Diehl frequently discussed their future and potential locations for their retirement, such as South America. Connell completely trusted that her relationship with Diehl was permanent. Diehl had promised to take care of Connell for her entire life, as he would a wife. Diehl told Connell that he loved her, that they would remain together as they got older and that she knew what kind of a man he was. Connell was very happy with Diehl and felt very fortunate to have him, because he provided for her and took care of her and her son. Connell always believed that the relationship was permanent and that Diehl would always take care of her no matter what. Connell testified, "It never occurred to me that we ever could break up. I knew I certainly would never leave him. It never occurred to me."
In 2002, Diehl started a new business, The Big Finger, a novelty-item business, which Diehl thought he could market on the internet through sources such as eBay. Diehl used Connell's credit to finance this business venture, borrowing $30,000 in Connell's name. This would ultimately lead Connell to bankruptcy.
Beginning in 2002 Connell and Diehl's relationship began to deteriorate. Prior to that time Diehl was generally satisfied with Connell's homemaking abilities. However, Diehl began accusing her of losing papers and magazines when she would tidy up the home. Connell testified that Diehl left things all over the home and she would keep things tidy in little piles for him. However, Diehl would wake her up at 3:00 or 4:00 in the morning, accusing her of losing things and making her search for them, sometimes even through their garbage cans outside. Diehl began to ignore Connell and, when he did speak to her, he would have outbursts where he cursed at her and was verbally abusive. He had never done this before.
In the Spring of 2002 Connell and Diehl started eating dinners at various local restaurants on Sunday afternoons for a few months, because she believed it was the only way for the two of them to spend time together. Diehl had begun to avoid her and not spend much time with her. Connell used the joint checking account to pay for the dinners by writing checks payable to herself and cashing them. However, Connell hid these expenses by writing in the check register that the check was for a Sears Roebuck or Macy's bill. They spent approximately $200 per month on restaurant dinners. Diehl was extremely angry when he learned that Connell was using the joint checking account for their dinners and stated that, if he had known about the source of the money, he would not have agreed to go out to eat with her. As a result of the incorrect entries, Diehl did not deposit enough money into the joint checking account to cover the amount of checks and the overdraft line of credit linked to the account was used to cover the overdrawn amounts.
Just before Connell's fifty-ninth birthday during the Winter of 2002, Diehl told her that he no longer wanted her to live with him and suggested that he take her to Florida to live because the cost of living there was lower than in New Jersey. Connell refused because she did not know anyone in Florida. Sometime later Diehl brought Connell to the PNC bank where they had a joint bank account to have Connell sign a form removing herself from their joint account. The bank employee instructed Connell where to sign and asked her if she knew that she was removing herself from the account and giving up her right to the balance in it. Connell admitted that she knew what she was doing but assumed that there would be a new joint account. Diehl did not create such an account.
When the novelty items sold by The Big Finger were not enough to pay back the loans, Diehl told Connell at the end of 2002 to file for bankruptcy rather than use his own money to pay back the loans taken in her name. He found a bankruptcy attorney for her, took her to the attorney's office and told her how to answer the questions for the bankruptcy paperwork. Connell did not indicate that she had any claim against Diehl in the bankruptcy petition. She filed the petition in 2003 and was discharged in bankruptcy on December 26, 2003.
In January 2004 Diehl told Connell that she had to move out of their home. Connell begged Diehl to change his mind but he would not do so. On March 4, 2004, Connell secured counsel and paid a $5000 retainer. Connell had difficulty finding an apartment due to her inadequate monthly income and her recent bankruptcy. Although Diehl suggested she get Section Eight housing and other governmental services, she instead found a trailer in Tom's River where her uncle lived. Diehl secured the trailer for her with a $26,000 down payment. Connell wanted to purchase the trailer solely in her name but was unable to do so due to her poor credit rating and low income. Therefore, Nick and Pat Hervonovich, friends or ...