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Molinari v. Molinari


April 1, 2008


On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Somerset County, FM-18-800-04.

Per curiam.


Submitted February 4, 2008

Before Judges Sabatino and Alvarez.

This is an appeal by defendant, David Molinari (the husband), from post-judgment orders requiring him to reimburse his former wife, plaintiff, Geralyn Molinari (the wife), the sum of $36,500, which was characterized in the orders as "child support." The amount represents credit card balances which plaintiff paid in full after defendant, who had agreed to indemnify her from this indebtedness in the parties' property settlement agreement (PSA) in exchange for forgiveness of child support, declared bankruptcy. Defendant's claim is that once having listed plaintiff as a creditor on his bankruptcy petition, he should be relieved from any obligation to her related to the PSA. Defendant also appeals the Family Part motion judge's refusal (1) to vacate the final judgment of divorce which incorporated the PSA, (2) to award him rehabilitative alimony, and (3) to grant him modification of the current order of visitation.

Both parties are pro se. We affirm the motion judge's initial order of September 8, 2006, as well as the reconsideration order of December 5, 2006, as modified in an order dated December 22, 2006. Our reasoning follows.

The parties have two children born of their marriage, a son born in September 1996, and a second son born in June 2000. They married on August 4, 1990. Their divorce was made final on December 6, 2004. On that date, the PSA they had previously signed on November 18, 2004, was incorporated into the divorce decree. No transcript has been supplied of the final divorce hearing. All the motions now under appeal were decided on the papers.

In reaching her conclusions, the motion judge relied upon the terms of the PSA, which relieved defendant from paying child support from March 2004, the date of the parties' separation, until January 1, 2006. The agreement specifies that, "[t]he parties acknowledge that wife is receiving a contribution for child support by way of equitable distribution of marital assets." In addition, as to equitable distribution of the parties' marital residence, the agreement states: "[i]n satisfaction of [w]ife's share of equitable distribution of the marital assets, and [h]usband's child support obligation pursuant to Article II, [h]usband shall convey to [w]ife all of his right, title, claim and interest in the former marital home." The PSA further states that plaintiff would be solely responsible for a first mortgage of $104,000, as well as a home equity loan having a balance of $60,000. The husband was obliged to "not further encumber the property." The PSA provides that should defendant "cause[] a lien to be placed on the property, then [h]usband shall indemnify and hold [w]ife harmless with respect thereto."

The PSA allocated all other assets and debts. Defendant retained a vehicle free and clear, while plaintiff was made solely responsible for the home equity loan, against which the parties had borrowed to purchase defendant's car. Plaintiff kept her pension and her deferred compensation plan; defendant retained his IRA. Defendant kept his carpentry business, together with any tools or equipment related to it.

The section in the PSA which allocated marital debts was quite detailed, reciting both the names and numbers of many credit card accounts and other debts, as well as the name of the spouse on the account, and known balances. Among the debts which defendant agreed to satisfy in full, and from which he indemnified plaintiff, were three accounts described in the PSA in the following manner:

Between February 3, and February 4, 2004, without [w]ife's knowledge or consent, [h]usband transferred outstanding balances from his business and personal credit card accounts totaling $21,115.00 into [w]ife's Rutgers MBNA Platinum Plus Mastercard (account . . .). Husband shall be solely responsible for paying this debt, and shall indemnify and hold [w]ife harmless with respect thereto. Within 10 days of the date of this Agreement, [h]usband shall transfer this balance back into credit card account(s) solely in his name.

In 2004, [h]usband opened and used [w]ife's inactive First USA National credit card account without [w]ife's knowledge or consent. Husband shall be solely liable for the outstanding balance on that account of approximately $3,829.00, incurred by him, and he shall indemnify and hold [w]ife harmless with respect thereto.

Husband shall be solely responsible to pay the following obligation[] and shall indemnify and hold [w]ife harmless with respect [to] . . . 50 percent of [w]ife's Citibank (account . . .), with a balance of $22,797.00.

Plaintiff asserts that when the PSA was signed, it was anticipated that defendant would file a bankruptcy petition to address his debts to third-party creditors. He, in fact, obtained a discharge in bankruptcy on November 30, 2005, approximately a year after the PSA was executed.

Around the time of defendant's discharge in bankruptcy, plaintiff contends she was notified by MBNA and Citibank and informed that if she did not pay the outstanding balance of $48,000 combined, a lien would be placed on the home she and the children occupied. Since these accounts were in plaintiff's sole name, the creditors' demands were of significant concern to her. According to the statements made in her appellate brief, $36,500 of that debt was specifically defendant's, pursuant to the PSA. These amounts approximate debts from which defendant indemnified plaintiff, specifically: the Rutgers MBNA Platinum Plus Mastercard totaling $21,115; the First USA National credit card account totaling $3,829; and half of plaintiff's Citibank account, or $11,396.

In any event, after plaintiff was notified by MBNA and Citibank about the prospect of a lien being placed on her home, she refinanced her home mortgage in order to satisfy the creditors. Plaintiff contends that a result of the refinancing, her monthly mortgage payment increased by $700. The increase in payment was due, not only to the increase in principal necessary to pay the credit card debts, but also to the higher interest rate on the loan charged to plaintiff because of her poor credit rating. She attributes this credit rating, at least in part, to defendant's failed business ventures and to the fact that he accumulated such significant balances in her name or their joint names, during the marriage.

Plaintiff asserts in her brief*fn1 that she attempted to obtain child support from defendant in January 2006 when permitted to do so by the PSA. When defendant refused to pay voluntarily, she filed a motion to enforce litigant's rights in March 2006 and again in July 2006. As she failed to submit appropriate documentation, neither of her initial attempts met with success. It was not until she retained counsel and re-filed for support that she obtained both the judgment for $36,500 and the current order of weekly support. Defendant is now required to pay $122 per week in child support plus an additional $25 per week towards the $36,500 judgment. The entry of the child support order triggered defendant's filing of cross-motions seeking rehabilitative alimony, reductions in child support and enforcement of litigant's rights as to visitation.

The civil case information statement defendant attached to his notice of appeal listed issues for our consideration other than those that he addressed in the brief. An issue not briefed is deemed waived. In re Bloomingdale Convalescent Ctr., 233 N.J. Super. 46, 48 n.1 (App. Div. 1989). Moreover, legal issues must be argued under point headings. R. 2:6-2(5). We will therefore only address the issues discussed in the brief, although their resolution may incidentally resolve the other issues listed in the case information statement. See Nieder v. Royal Indem. Ins. Co., 62 N.J. 229, 234-35 (1973).

Defendant first contends that the PSA should be vacated as "being inequitable and contrary to law." He offers no reason to vacate the agreement other than the bare assertion that he was coerced into signing it. He makes the argument without any citation to the record. Defendant claims that his attorney rushed him into the PSA, offering him no guidance or support. In the absence of the transcripts of the divorce proceeding or any other proof in the record on appeal, these claims have not been shown to have merit. See State v. Hild, 148 N.J. Super. 294, 296 (App. Div. 1977).

The PSA did take into account defendant's inability to pay child support, while at the same time paying debts he accumulated in his name and in plaintiff's. Defendant was therefore excused from the obligation to make any child support payments from March 24, 2004 to January 2006. By virtue of his discharge in bankruptcy, and retention of his IRA, tools of trade and his vehicle, he was afforded an opportunity to make a fresh start. "Given the absence of unconscionability, fraud, or overreaching in the negotiations of the settlement, . . . no legal or equitable basis exists to reform the parties' property settlement agreement." Miller v. Miller, 160 N.J. 408, 419 (1999).

Defendant also contends that the orders on appeal entered against him for $36,500 were made without "concrete evidence or proof of this figure, and therefore was bias [sic] in its decision and unfair." Actually, the figure is less than the total indebtedness which the PSA required defendant to satisfy, namely the sums he borrowed without his wife's knowledge or consent. There is no basis for vacating the judgment on those grounds. We were not provided with copies of plaintiff's moving papers, and will therefore rely on the motion judge's findings of fact.

Defendant further contends that the Bankruptcy Reform Act of 1994, 11 U.S.C.A. § 523(a)(15), relieves him of any further responsibility for the marital debts. As the motion court correctly held, debts relating to alimony, maintenance and support cannot be discharged in bankruptcy. Schorr v. Schorr, 341 N.J. Super. 132, 137 (App. Div. 2001) (citing 11 U.S.C.A. § 523(a)(5)); Stein v. Fellerman, 144 N.J. Super. 444, 449 (App. Div. 1976), certif. denied, 73 N.J. 50 (1977). The burden of proof as to whether a discharged debt is in fact alimony, maintenance, or support is borne by the party claiming the debt is non-dischargeable. Schorr, supra, 341 N.J. Super. at 137 (citing In re Midnet, 84 B.R. 776, 778 (Bankr. M.D. Fla. 1988); Fed. R. Bankr. P. 4005). In making that determination, courts are not bound by the labels employed by the parties; rather the courts must look beyond those labels to determine the true intent of the parties and the "'true nature'" of their agreement. Ibid. (quoting In re Gianakas, 917 F.2d 759, 762 (3d. Cir. 1990)). Three factors must be weighed in the balance to make the necessary determination: "1) the language and substance of the agreement in the context of surrounding circumstances, using extrinsic evidence if necessary; 2) the parties' financial circumstances at the time of the settlement; and 3) the function served by the obligation at the time of the divorce or settlement." Id. at 137-38 (quoting Gianakas, supra, 917 F.2d at 762-63).

We are satisfied that the parties intended, without question, that defendant's assumption of the bulk of the credit card debt would be in lieu of child support for a defined period. He assumed full responsibility for some of the debts, and, in exchange, was granted forgiveness for any responsibility to pay weekly child support for two young children for nearly two years.

Although the parties knew that defendant planned to claim bankruptcy, they did not intend that defendant's indebtedness, which was incurred solely in plaintiff's name, would thereby become plaintiff's responsibility. That was the very purpose of the contrary provision in the PSA which states that, in the event of a declaration of bankruptcy, each party would "remain personally liable to the other for any and all expenses incurred by him/her, either in connection with the defense of any suit(s) instituted by a creditor or in connection with the payment of any monies to a creditor." As the PSA further specified, the parties did not intend that the filing of a bankruptcy would "act to the financial detriment of the other spouse."

Because the indebtedness defendant sought to discharge was in plaintiff's name, absent her joining him in the filing of a bankruptcy, there is no equitable way that he could avoid the debt, once the creditors turned to plaintiff for payment. In fact, his failure to satisfy that indebtedness could have jeopardized the very home in which plaintiff and the children resided. And allowing the children to remain in the marital home was also a form of support contributed by defendant for the children. See Winegarden v. Winegarden, 316 N.J. Super. 52, 61 (App. Div. 1998).

We are therefore satisfied that the motion judge correctly concluded that the assumption of debt and the "hold harmless" agreement was in the nature of support and therefore not dischargeable in bankruptcy by defendant. A reason separate from the exemption in bankruptcy law from discharge of support obligations is that to do otherwise would inequitably shift defendant's liability to plaintiff. "To now permit defendant to renege on his express agreement would be contrary to case law and an injustice to plaintiff" and the children. Schorr, supra, 341 N.J. Super. at 140.

Defendant also asserts that because at the time of divorce and thereafter, he has been unemployed or minimally employed, that he should have received alimony. He maintains this circumstance is another reason the PSA should be modified or vacated. Defendant is college educated and healthy. He operated his own business prior to the separation of the parties. He is at least capable, as the court found, of earning $10 per hour. On the date of this finding, plaintiff's annual salary was $72,254. It would be inequitable, indeed, to require plaintiff to pay defendant alimony given that she is the principal source of support for the parties' young children. Defendant waived all rights to alimony in the PSA, and his position that alimony should have been paid to him is an argument that does not warrant further discussion in a written opinion. R. 2:11-3(e)(1)(A), (E).

The relief defendant seeks as to the children is not clear from either the case information statement or his brief. We discern the following. Defendant is unhappy that the plaintiff is not bringing the children to see him in Pennsylvania, where he now resides. He attached a list to his moving papers showing he has visited the children since the divorce some twenty-one occasions in New Jersey, while plaintiff has taken the children to visit him in Pennsylvania only six times. In her September 8, 2006 statement of reasons, the motion judge required the parties to select a new visitation supervisor. It is troubling that no supervisor has been agreed upon. The parties were also directed to participate in parenting mediation and to each pay for half the cost. It is equally troubling that the parties have not participated in mediation because defendant claims he is unable to pay mediator fees. On this record, we cannot say any error occurred as to visitation. The judge's decision that a mediator should first attempt to assist the parties in developing the details related to visitation is therefore affirmed.


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