May 13, 2008
KRISTIN RUOCCHIO, PLAINTIFF-RESPONDENT,
JAMES RUOCCHIO, DEFENDANT-APPELLANT.
On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Ocean County, Docket No. FM-15-1265-05.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued February 26, 2008
Before Judges Winkelstein, Yannotti and LeWinn.
Kristin Ruocchio (plaintiff) and James Ruocchio (defendant) were married on April 6, 2002. Plaintiff filed her complaint for divorce not quite three years later, on March 14, 2005.
They have two children, one born December 17, 2003, and the other, born one month after plaintiff filed her divorce complaint, on April 20, 2005. Following a six-day trial, between September 5 and December 1, 2006, Judge Sheldon R. Franklin rendered a decision from the bench and entered a final judgment of divorce on February 28, 2007.
Defendant appeals, raising the following issues for our consideration:
I. THE STANDARD OF REVIEW IN THE INSTANT MATTER IS WHETHER THE COURT ABUSED, OR MISTAKENLY EXERCISED, ITS DISCRETION RESULTING IN A MANIFEST INJUSTICE
II. THE TRIAL COURT ABUSED ITS DISCRETION IN AWARDING REHABILITATIVE ALIMONY TO THE WIFE WHO HAD A COLLEGE DEGREE AND WHO COULD RETURN TO HER PREVIOUS EMPLOYMENT AS A SPECIAL ED TEACHER AFTER HER MATERNITY LEAVE
III. THE TRIAL COURT ERRED AND ABUSED ITS DISCRETION WHEN IT IMPUTED INCOME TO DEFENDANT, FAILED TO IMPUTE [AN] APPROPRIATE AMOUNT OF INCOME TO PLAINTIFF, AND FAILED TO REFLECT CREDIT FOR DEFENDANT'S PRIOR CHILD SUPPORT OBLIGATION IN CALCULATING THE GUIDELINES
IV. THE TRIAL COURT ABUSED ITS DISCRETION BY DIVIDING THE PROCEEDS OF SALE OF THE MARITAL HOME EQUALLY AND WITHOUT AWARDING THE DEFENDANT ANY CREDIT FOR THE SUBSTANTIAL DOWNPAYMENT EVEN THOUGH THE HOUSE WAS PURCHASED BEFORE THE PARTIES WERE ENGAGED AND NOT IN CONTEMPLATION OF MARRIAGE
V. THE TRIAL COURT ABUSED ITS DISCRETION BY EQUALLY DIVIDING THE WACHOVIA BROKERAGE ACCOUNT CONTRARY TO DEFENDANT'S TESTIMONY AND EVEN THOUGH PLAINTIFF ACKNOWLEDGED THAT THE ACCOUNT CONSISTED, AT LEAST PARTIALLY, OF PRE-MARITAL FUNDS
VI. THE TRIAL COURT ABUSED ITS DISCRETION BY REQUIRING DEFENDANT TO CONTRIBUTE $20,000.00 TOWARDS PLAINTIFF'S COUNSEL FEES IN ADDITION TO THE FEES HE HAD PREVIOUSLY PAID
Having reviewed the entire record, we conclude that the judgment should be affirmed in all respects, for the reasons set forth in the bench decision rendered by Judge Franklin on February 28, 2007. Each of the issues challenged on appeal received thorough analysis and consideration by the trial judge, who made specific findings of fact in support of each ruling.
The standard of review applicable to such findings is well established.
The scope of appellate review of a trial court's fact-finding function is limited. The general rule is that findings by the trial court are binding on appeal when supported by adequate, substantial, credible evidence. Deference is especially appropriate "when the evidence is largely testimonial and involves questions of credibility." Because a trial court "'hears the case, sees and observes the witnesses [and] hears them testify,' it has a better perspective than a reviewing court in evaluating the veracity of witnesses." Therefore, an appellate court should not disturb the "factual findings and legal conclusions of the trial judge unless [it is] convinced that they are so manifestly unsupported by or inconsistent with the competent, relevant and reasonably credible evidence as to offend the interests of justice." The appellate court should "exercise its original fact finding jurisdiction sparingly and in none but a clear case where there is no doubt about the matter." [Cesare v. Cesare, 154 N.J. 394, 411-12 (1998)(citations omitted).]
"Because of the family courts' special jurisdiction and expertise in family matters, appellate courts should accord deference to family court factfinding." Id. at 413.
Applying these standards to the decision at issue, we conclude that Judge Franklin's resolution of all issues is "supported by adequate, substantial and credible evidence[,]" and, therefore, must be "considered binding on appeal[.]" Rova Farms Resort, Inc. v. Investors Ins. Co. of Am., 65 N.J. 474, 484 (1974).
We briefly address defendant's arguments.
The trial court ordered defendant to pay plaintiff rehabilitative alimony in the amount of $575.00 per week for a period of eighteen months, terminating on September 15, 2008. It was undisputed at trial that plaintiff was, and remains, the primary caretaker of the parties' young children. Prior to the marriage, plaintiff was employed as a special education teacher in the Tom's River School System; in that position she earned approximately $37,000.00 per year. Plaintiff went on maternity leave in November 2003, shortly before the birth of the parties' first child, and did not thereafter return to employment. At the time of trial, plaintiff was attending Georgian Court College, where she was working towards a master's degree and certification as a Learning Disabilities Teacher Consultant. Plaintiff testified that once she obtained this master's degree and certification, she would be able to earn approximately $60,000 to $65,000 per year. She anticipated completing her studies by December 2007 and obtaining employment at the start of the new school year in September 2008.
In his ruling on rehabilitative alimony, the trial judge noted:
In addition to her absence from the workplace for over three years, Kristin has made an extremely reasonable decision in contemplation of her marital dissolution to enhance her income-producing capability. Kristin's plan to obtain a Master's and a certification by attending Georgian Court . . . is well thought out and of relatively short duration [and she] expect[s] to be working at a salary of at least $60,000 per year by September 2008.
The trial judge concluded that "this is a perfect case for rehabilitative alimony[,]" relying upon Cerminara v. Cerminara, 286 N.J. Super. 448 (App. Div.), certif. denied, 144 N.J. 376 (1996). In that case, we held that "rehabilitative alimony may be employed where one spouse has been out of the workplace, usually raising a family and maintaining the marital home, thereby allowing the other spouse to pursue career goals. Upon separation, the unemployed spouse needs time and assistance to recover from [his/her] absence from the workplace." Id. at 460; see also Cox v. Cox, 335 N.J. Super. 465, 475 (App. Div. 2000). Moreover, because rehabilitative alimony is ordinarily ordered for a brief period of time, it "may well be for a sum greater than would have been awarded as permanent alimony." Turner v. Turner, 158 N.J. Super. 313, 318 (Ch. Div. 1978).
Under the circumstances, the trial judge's award of rehabilitative alimony for a period of eighteen months, commensurate with the period of time it would take plaintiff to return to the work force in a higher-paying position, was proper. The amount of alimony was calculated by the judge following his thorough analysis of each party's financial situation.
In that regard, we also reject, as without merit, defendant's argument that the judge erred in his imputation of income to each party. The income imputed to plaintiff was based upon her actual earnings as of the time of trial, while she was caring for two young children and pursuing her master's degree and certification. Under those circumstances, plaintiff's income-earning capacity was limited to tutoring and preparing individual education plans for the school district. Fortunately for both parties, this situation will be of limited duration; very shortly, plaintiff will be in a position to obtain employment at a significantly higher salary range than her employment at the time of the marriage.
Regarding defendant's income, we find no abuse of discretion in the trial judge's imputation. During the marriage, in 2002, defendant was employed at Lexus/Nexus Matthew Bender, and earned $61,742.33. He was fired from that company in 2004. As of the time of trial, defendant was employed at the Bureau of National Affairs (BNA) where he earns a salary of $30,000 plus 20% commission on all sales that he accomplishes.
The judge noted that defendant's sales at BNA went "from a high of 83.9 percent to 54.3 percent of quota[,]" commencing in October 2005. His year-to-date gross income of $15,305.45 through April 2, 2005 extrapolated to gross annual income of $60,722.71. Noting that defendant "has offered no explanation as to why he cannot earn from his job as a salesman what he earned in 2002," the judge found that defendant "has the present capacity to earn $64,000 per year as a salesman." The judge further found that defendant could earn an additional $6,000 per year through his boat detailing business. The judge noted that this estimate was "arbitrary," but cited defendant's "discovery deficiencies . . . that make it appropriate to consider the evidence negatively against [defendant]" and to impute this amount of business income to him. The judge therefore concluded that defendant had the capacity to earn $70,000 per year.
Plaintiff testified that defendant had previously earned as much as $120,000 per year as a salesman for Lexus/Nexus. She further testified that she believed defendant engaged in a deliberate "strategy" to reduce his earnings in order to reduce his child support obligation for his daughter from a prior relationship. However, plaintiff produced no evidentiary support for these allegations.
Based upon the trial record, we conclude the trial judge's imputation of income to each party was not an abuse of discretion. Plaintiff's imputed income was based upon her actual earnings under her current circumstances. Defendant's income was based on the trial judge's reasonable assessment of what defendant could earn, given his employment history along with his side business of boat detailing.
We turn next to defendant's claim that the trial judge erred in awarding plaintiff one half the net equity in the marital residence, by way of equitable distribution. Defendant had acknowledged that the parties were living together at the time they purchased this property. They placed the house in both of their names at closing and opened a joint bank account from which the mortgage payments were made. It is undisputed that defendant made a down payment of $26,850 from his own funds. However, it is also undisputed that plaintiff used approximately $10,000 of her own funds to purchase furnishings and other items for the home.
The judge found that "both parties made financial contributions towards the furnishings and improving of" the marital residence. In light of the fact that the parties were already living together at the time of purchase, that title was taken in both their names, and that joint funds went towards the carrying costs and other expenses of the residence, the judge concluded that the property was acquired in contemplation of marriage, and relied upon Weiss v. Weiss, 226 N.J. Super. 281 (App. Div.), certif. denied, 114 N.J. 287 (1988). In that case, we recognized: that a date prior to the marriage ceremony can, in appropriate circumstances, qualify as the date of commencement of the marriage for the purpose of deciding whether property is a marital asset subject to equitable distribution. . . . [F]or the purpose of triggering a right of equitable distribution a marital partnership may be found to have commenced prior to the marriage ceremony, where the parties have adequately expressed that intention and have acquired assets in specific contemplation of their marriage. This conclusion recognizes that the "shared enterprise" of marriage may begin even before the actual marriage ceremony through the purchase of a major marital asset such as a house and substantial improvements to that asset. [Id. at 287.]
The record in this case supports the conclusion that these parties engaged in the "shared enterprise" of marriage, by the manner in which they purchased and furnished this home, resided there together and met expenses with joint funds for the next thirteen months until their marriage. On this record, we find no abuse of discretion in the trial judge's equitable distribution of this asset.
We turn next to defendant's argument that the trial judge erred in equitably distributing his Wachovia brokerage account. This claim is without merit. Defendant contended at trial that this account was, at least in part, a pre-marital asset and, therefore, immune from equitable distribution. However, the burden of establishing such immunity from equitable distribution rests upon the party asserting it. Pascale v. Pascale, 140 N.J. 583, 609 (1995).
The trial judge made a concerted effort to trace the origins of defendant's Wachovia account as well as the origins and timing of deposits into that account. However, defendant failed to provide clear documentation on these issues. This led the trial judge to make the specific finding that defendant had failed to carry his burden of proof of the degree, if any, to which this asset was premarital and, therefore, immune from equitable distribution. In light of the deficiency of defendant's proofs, we conclude that the trial judge properly resolved this issue.
We next consider defendant's argument that the trial judge erred in failing to grant him a credit for his child support obligation for a daughter from a prior relationship. Although it was undisputed that defendant did have a daughter from such a relationship, he failed to produce any documentation of a current child support obligation to that child.
Defendant produced an order dated May 20, 2003, from the Gloucester County Family Part, setting his child support obligation at $169.00 per week. However, the record established that defendant's daughter had entered college since the entry of that 2003 order, and there was no indication of his current child support obligation in light of that changed circumstance. In a footnote to his appellate brief, defendant stated that his child support was "reduced to $57.00 per week since the trial."
However, there is no probative evidence of record documenting his actual child support obligation as of the time of trial.
Pursuant to the New Jersey Child Support Guidelines: "Since previously ordered child support of other relationships represents income that is not available for determining the current child support obligation, the amount of such orders must be deducted from the obligor's weekly [income]." Child Support Guidelines, Pressler, Current N.J. Court Rules, Appendix IX-B to R. 5:6A at 2333 (2008). However, as noted, defendant failed to document the current amount of such an order as of the time of trial. Therefore, the trial judge properly denied him this credit in calculating child support.
Finally, we turn to defendant's argument that the trial judge erred in awarding plaintiff $20,000 in counsel fees, to be deducted from defendant's share of the proceeds of sale of the marital residence. Judge Franklin engaged in a thorough discussion of this issue and fully analyzed and applied the pertinent factors in the court rules.
In his analysis, the judge noted that defendant "has taken positions and conducted himself with respect to finances in such a way as to tremendously escalate [plaintiff's] legal fees in this case. In several respects, [defendant's] conduct has been the result of bad faith." The judge then proceeded to identify numerous incidents of defendant's conduct in the record to support that finding, such as: (1) secretly withdrawing $28,994.79 from the parties' Barnegat Bay Boating account and depositing those funds in a separate bank account in his name only; (2) secretly transferring ownership of Barnegat Bay Boating, previously in the name of both parties, to himself alone; (3) failing to respond to discovery requests for the production of bank statements for Barnegat Bay Boating, along with numerous other discovery abuses; and (4) failing to provide plaintiff and the children with adequate support during the pendente lite period, while maintaining his own living expenses.
Defendant argues that the trial judge imposed "double punishment" upon him for this conduct by (1) denying him reimbursement of his $26,850 down payment on the marital residence; and (2) imposing this counsel fee obligation upon him. However, as noted, the trial judge's equitable distribution decision on the marital residence was based primarily upon the judge's determination that the purchase and furnishing of that residence constituted a "joint enterprise" into which both parties invested personal funds. To the extent that the trial judge referred to defendant's dissipation of funds in relationship to equitable distribution of the marital residence, such reference was in the nature of additional commentary and not the sole basis for that equitable distribution decision.
In addition to setting forth his findings of bad faith on defendant's part, the trial judge also noted that plaintiff had to borrow $15,000 from her parents to help pay her counsel fees. The judge noted further that, although defendant appeared pro se at trial, he had previously retained counsel to whom he had paid over $9,000 in fees "during the early portions of this case." By contrast, plaintiff had incurred counsel fees of $40,365.55 as of September 1, 2006, before trial had even commenced, and a significant portion of those fees was incurred in discovery efforts.
We conclude the trial court did not abuse its discretion in requiring defendant to pay $20,000 towards plaintiff's counsel fees. This award was clearly based on substantial credible evidence of record. Rova Farms Resort, supra, 65 N.J. at 483-84.
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