May 20, 2008
SZILVIA FUZER, PLAINTIFF-RESPONDENT,
FRANCIS Z. FUZER, DEFENDANT-APPELLANT.
On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Camden County, Docket No. FM-04-872-05D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted April 2, 2008
Before Judges Lisa, Lihotz and Simonelli.
Defendant, Francis Z. Fuzer, appeals from several portions of the final judgment of divorce, entered after a three-day trial, and the denial of his reconsideration motion. Defendant and plaintiff, Szilvia Fuzer, were married for ten years and had no children. The judgment obligated defendant to pay limited duration alimony for four years and provided for equitable distribution of marital assets, to be divided approximately equally between the parties. Defendant argues: (1) the court erred in refusing to consider his reconsideration motion and instead instructing him to file a Rule 4:50-1 motion to vacate; (2) the court erred in awarding alimony because plaintiff was cohabitating with her paramour who was supporting her, or, alternatively, the amount of alimony was not properly determined; (3) several components of the equitable distribution award to plaintiff should not have been made or were improperly calculated; and (4) the award of counsel fees to plaintiff did not accord with controlling legal principles and constituted a mistaken exercise of discretion. We agree that the trial court inadvertently double counted one item of property distributed to plaintiff, and that defendant is entitled to a $9000 credit for that item. We reject defendant's remaining arguments and in all other respects affirm.
The parties married in 1994. Defendant is about twenty years plaintiff's senior and was previously married. The parties are of Hungarian ancestry. They met in Hungary. During the marriage, they vacationed in Hungary about four weeks each year. Defendant continues to have business interests in Hungary.
Marital difficulties began in 2000 and the parties briefly separated in 2001. Plaintiff filed a divorce complaint at that time, but dismissed it. The parties separated again in September 2003. Plaintiff moved in with her paramour, Erno Pleszinger, but reconciled with defendant in January 2004. On December 1, 2004, plaintiff filed the complaint that resulted in the judgment now before us. She resumed living with Pleszinger, and continued to live with him during the pendency of the divorce proceedings.
Defendant worked as a car salesman, and was also an entrepreneur in various business enterprises. In each of the several years before the divorce proceedings began, he reported annual gross income between $114,000 and $148,000. Although he claimed his earnings subsequently decreased, the judge imputed income to him of $100,000 to $120,000 per year, which defendant does not dispute. After coming to this country from Hungary, plaintiff obtained a cosmetology license. Although she was not working at the time of the divorce, the judge imputed income to her of $30,000 per year, which she could earn as a cosmetologist. Neither party disputes that determination. The judge also imputed to plaintiff five percent interest income on the assets awarded to her in equitable distribution.
The parties lived a middle class to lower upper class lifestyle. Defendant held a 401(k) account during the entirety of the marriage, with a balance of just over $50,000 in June 2005. The parties bought and sold several homes over the years. They purchased jewelry together and shopped at boutiques or high end stores. They ate the majority of their meals away from home at very nice restaurants. They drove expensive cars. However, the parties also incurred substantial debt, depleting credit lines on two of the properties they owned, and running up significant credit card debt. They accumulated no savings.
Plaintiff claimed that defendant failed to make car payments and insurance payments for her BMW and, at the time of trial, Pleszinger made these payments. Plaintiff and Pleszinger lived together, with Pleszinger supporting her and paying most of her monthly expenses. This situation existed, according to plaintiff, because she left the marriage with only $1200 and defendant refused to pay any pendente lite support. She did not have many friends in this country to whom she could turn, and she thus lived with Pleszinger and accepted the support he provided in order to avoid being destitute. Plaintiff said that by the time of the divorce Pleszinger had paid about $30,000 to support her, but that he expected repayment and she intended to repay him once the divorce proceeding was concluded and she received what was due her. She expressed a desire to return to work once the divorce was concluded.
At the time of the divorce trial, defendant was living in Florida. He lived with a friend in the house next door to one purchased by defendant and plaintiff. He was working at a BMW dealership.
The only witnesses at the trial were plaintiff, defendant, defendant's former wife (the mother of his seventeen-year-old daughter), and Zsalt Talnai, for whom one of defendant's businesses performed some construction work for $3000. Talnai testified that rather than pay defendant's company directly, he and defendant agreed that Talnai's mother would give $3000 to defendant's father in Hungary. Talnai further testified that defendant told him and his wife not to tell plaintiff about this payment.
At the conclusion of the trial, on June 1, 2006, Judge Holden rendered his decision. He awarded limited duration alimony to plaintiff of $300 per week for four years. He equitably distributed to plaintiff one-half of the following assets (with plaintiff's share shown in parentheses): the payment from Talnai to defendant ($1500); the imputed value of defendant's Commerce bank account, consisting of funds "which were secreted by defendant" ($56,000); funds wired by defendant from that account to Hungary ($9000); defendant's 401(k) plan ($31,101); the proceeds from the sale of the couple's first home ($57,989); and the expected refund on the couple's 2005 tax return ($5750). The judge ordered the parties to sell the Florida home and divide the net proceeds equally, with credit to be applied against plaintiff's share for any provable tax payments or physical improvements made by defendant. An arbitrator calculated the appropriate credits to be $6647.
The judge ordered plaintiff to pay off the outstanding credit card debts. Upon plaintiff's presentation of proof of payment, the judge ordered defendant to reimburse plaintiff for one-half of the amount paid. The judge also ordered the parties to sell any contested personal items and to divide the proceeds equally. Finally, in announcing his oral decision, the judge ordered defendant to pay "60% of Mrs. Fuzer's outstanding attorney fees." In the final order, issued the same day, the word "outstanding" was not included.
Defendant moved for reconsideration on June 20, 2006. He attached a lengthy certification, generally challenging each part of the final order, but in conclusory terms. Defendant also referred to the alleged discovery after trial of a joint bank account held by Pleszinger and plaintiff, characterizing it as "new evidence" of plaintiff's cohabitation and employment with Pleszinger. Defendant had new counsel, who had not read the trial transcripts and, of course, was not present for the trial testimony. Noting that his factual determinations were based largely upon his assessment of credibility, the judge commented that defendant's testimony "was unbelievable, deceptive, dishonest, duplicitous, he was vague with regard to his testimony, the documents that he presented were inconclusive, contradictory." The judge found no basis in the moving papers for reconsideration and denied the motion without prejudice, commenting that counsel could order the transcript and re-file the motion if he chose. With respect to the joint bank account of plaintiff and Pleszinger, the judge advised defendant's attorney that the proper manner to raise a "new evidence" issue was through the filing of a Rule 4:50-1 motion to vacate the judgment. The judge reviewed defendant's objection to the counsel fee award and, in his oral decision, did not refer to plaintiff's "outstanding" attorney's fees.
The judge entered an order memorializing his decision on August 31, 2006. The order contemplated the possible reconsideration of "any errors or inconsistencies between its decision and the trial record" in the event defendant filed a Rule 4:50-1 motion. Defendant did not file such a motion. Instead, he filed this appeal.
We first address defendant's argument that the judge erred in refusing to consider his reconsideration motion, instead instructing him to file a Rule 4:50-1 motion. And, for the first time on appeal, defendant argues that his application "should have been considered a request for a new trial" under R. 4:49-1. We find these arguments unpersuasive.
Upon a proper application, a trial court sitting without a jury has the authority to open the judgment, take additional testimony, and amend findings of fact and conclusions of law.
R. 4:49-1(a). The moving party can raise, among other things, "newly discovered evidence which would probably alter the judgment or order and which by due diligence could not have been discovered in time to move for a new trial under R. 4:49," or "fraud . . . misrepresentation, or other misconduct of an adverse party." R. 4:50-1(b), (c). See also Quick Chek Food Stores v. Twp. of Springfield, 83 N.J. 438, 445 (1980).
Defendant argues that discovery of the joint bank account should have required a reopening of the case because proof of a business relationship between plaintiff and Pleszinger would eliminate the factual basis underlying the alimony award and raise questions about plaintiff's future earning capacity. However, we are not persuaded that this was "new" evidence for the purposes of these rules. Defendant referred to the account in his testimony. He referred to the alleged business partnership between plaintiff and Pleszinger. The judge found the testimony unreliable and disregarded it. It is unlikely that further information regarding the bank account would alter the final decision. Pleszinger held a large amount of money in the account prior to plaintiff's addition as a signatory. Plaintiff certified that Pleszinger did not share these proceeds with her. To the extent defendant complains about plaintiff's failure to produce the subpoenaed documents, procedural steps were available to defendant of which he could have availed himself.
We also find no merit in defendant's argument regarding his reconsideration motion under Rule 4:49-2. Such a motion must state with specificity the basis on which it is made, including a statement of the matters or controlling decisions which the moving party believes the court overlooked or as to which it erred. R. 4:49-2. Defendant's application did not meet this standard, but was a list of general objections and disagreements with the judge's conclusions. We find no mistaken exercise of discretion in the denial of the reconsideration motion, and defendant has not provided any basis for vacating the judgment, reopening the trial, or granting a new trial.
We next consider the award of limited duration alimony. Alimony is neither a punishment nor a reward. "It is a right arising out of the marriage relationship to continue to live according to the economic standard established during the marriage as far as economic circumstances will allow." Aronson v. Aronson, 245 N.J. Super. 354, 364 (App. Div. 1991). Accordingly, "the marital standard of living" remains the critical starting point to any alimony determination. Crews v. Crews, 164 N.J. 11, 25 (2000); Konzelman v. Konzelman, 158 N.J. 185, 195 (1999). "The supporting spouse's obligation is set at a level that will maintain that standard." Innes v. Innes, 117 N.J. 496, 503 (1990). An alimony award should be molded with reference to the dependent spouse's needs, that spouse's ability to contribute to the fulfillment of those needs, and the supporting spouse's ability to maintain the dependent spouse at the former standard. Lepis v. Lepis, 83 N.J. 139, 152 (1980). Appropriate factors to consider in the alimony determination are listed at N.J.S.A. 2A:34-23b.
Defendant challenges the alimony award here on two bases. He argues that the trial judge erred in failing to find that plaintiff was cohabitating with her paramour who was supporting her. Alternatively, he argues that the judge erred in calculating the award and failed to provide sufficient reasons for the amount of the award. We reject these arguments.
We first observe that limited duration alimony was appropriate in this case. This was a ten-year marriage with no children. There was a substantial disparity in earnings and earning capacity between the parties. Further, the amount of the award was appropriately set in consideration of the imputed incomes of the parties and the marital lifestyle they enjoyed.
We will not interfere with an alimony award unless we are convinced the determination was so manifestly unsupported by or inconsistent with the competent, relevant and reasonably credible evidence as to offend the interests of justice. Platt v. Platt, 384 N.J. Super. 418, 425 (App. Div. 2006). We are satisfied from our review of the record that Judge Holden gave full consideration to the relevant statutory factors to mold the alimony award. In his oral decision, the judge touched upon nine of the eleven relevant criteria, and relied upon the testimony of the parties, to the extent he found it credible, and the case information statements to assess the marital lifestyle. See Glass v. Glass, 366 N.J. Super. 357, 367 n.4 (App. Div.), certif. denied, 180 N.J. 354 (2004). We reject defendant's contention that the judge did nothing more than make "naked conclusions" in explaining the alimony decision. On the contrary, the judge's findings were well articulated and based upon sufficient credible evidence in the record.
We also find no merit to defendant's argument that alimony should have been disallowed because of plaintiff's cohabitation with Pleszinger. Initially we find misplaced defendant's reliance on Rose v. Csapo, 359 N.J. Super. 53 (Ch. Div. 2002). We disagree with defendant's suggestion that there is any legal significance to the distinction between cohabitation with a paramour prior to judgment as opposed to after the entry of judgment. On the contrary, that case noted the similar goals of pendent lite support and an award of alimony. Id. at 60. Thus, whether the cohabitation issue arises pre-judgment or post-judgment, the analysis is the same.
Our Supreme Court recognizes that "the dependent spouse's cohabitation with another" may provide sufficient "changed circumstances" to warrant the modification of an alimony determination. Lepis, supra, 83 N.J. at 151 (citations omitted). The more difficult question concerns the proper circumstances in which to find "cohabitation" between the dependent spouse and a paramour. It is clear that the term does not simply entail sex. Konzelman, supra, 158 N.J. at 202. Rather, "cohabitation should be considered only as it relates to reduced financial needs." Eames v. Eames, 153 N.J. Super. 99, 105 (Ch. Div. 1976). This basic principle supports the modification of the supporting spouse's obligation if "the alleged cohabitation of plaintiff has affected her need for the support money, either because of receiving support from her paramour or the probability of her utilizing the amount sought, or a portion thereof, to support a paramour." Id. at 107; see Gayet v. Gayet, 92 N.J. 149, 153-54 (1983).
The Court has continued to develop this "economic needs" approach to determine the effect of cohabitation on the duty to continue to pay support. Konzelman, supra, 158 N.J. at 196; Gayet, supra, 92 N.J. at 153. The Konzelman Court noted that "[c]ohabitation constitutes a change of circumstances only if coupled with economic consequences; the economic benefit enuring to either cohabitor must be sufficiently material to justify relief." Konzelman, supra, 158 N.J. at 196 (discussing Gayet, supra, 92 N.J. at 154-55). The Court continued:
The ordinary understanding of cohabitation is based on those factors that make the relationship close and enduring and requires more than a common residence, although that is an important factor. Cohabitation involves an intimate relationship in which the couple has undertaken duties and privileges that are commonly associated with marriage. These can include, but are not limited to, living together, intertwined finances such as joint bank accounts, sharing living expenses and household chores, and recognition of the relationship in the couple's social and family circle.
[Id. at 202.]
Furthermore, "to constitute cohabitation, the relationship must be shown to be serious and lasting." Id. at 203.
While it is undisputed that plaintiff lived with Pleszinger in a romantic relationship, the totality of the circumstances must be evaluated and "the fairness in altering an alimony obligation in the event of cohabitation by the dependent spouse must be assessed in light of all material surrounding circumstances and will vary from case to case." Id. at 198. The judge found credible plaintiff's testimony that Pleszinger expected reimbursement for the expenses he advanced on plaintiff's behalf. The judge also credited plaintiff's denial that she was associated in business with Pleszinger. Even if the trial evidence could be construed as including reference to a joint bank account, the record also contained plaintiff's denial that she had any access to the funds in the account, which the judge also credited. Importantly, in light of defendant's refusal to pay pendente lite support, plaintiff was destitute, unemployed, living in a country in which she had few friends, and under duress resulting from defendant's threatening and potentially violent conduct toward her. Her explanation of her living arrangements with Pleszinger was reasonable, and supports the judge's conclusion that Pleszinger was not supporting plaintiff, nor was plaintiff using the alimony money to support Pleszinger, rather than to meet her own reasonable needs. Therefore, the living arrangements did not constitute the type of cohabitation that would preclude an alimony award or affect the amount. We find no error in the judge's determination, which is amply supported by the evidence.
We next address the alleged errors in the equitable distribution award. Defendant argues that the judge erred with respect to his 401(k) account by failing to deduct a loan from the account and by failing to account for the taxation of the pension at the time of withdrawal. He further argues there was no financial basis to assign a value of $112,000 to his Commerce bank account and, with regard to that account, the judge "double counted" by awarding plaintiff one-half the value of the account and also awarding her one-half of the $18,000 in wire transfers made from the account. Finally, he contends the judge erred in awarding plaintiff one-half of the $3000 for work his company performed for Talnai, without accounting for his alleged later return of that payment to Talnai.
"It is well-settled that, upon dissolution of a marriage, New Jersey law allows for 'an equitable distribution of the property, both real and personal, which was legally and beneficially acquired by . . . either [party] during the marriage. . . .'" Genovese v. Genovese, 392 N.J. Super. 215, 223 (App. Div. 2007) (quoting N.J.S.A. 2A:34-23h). Prior to the entry of any equitable distribution order, the trial judge engages in a three-step inquiry. Rothman v. Rothman, 65 N.J. 219, 232 (1974). "[O]nce the trial judge decides what specific property of each spouse is eligible for distribution," he or she "must then determine its value for purposes of such distribution, and decide the most equitable allocation between the parties after analysis of the statutory factors set forth in N.J.S.A. 2A:34-23.1." Genovese, supra, 392 N.J. Super. at 225-26 (citing Rothman, supra, 65 N.J. at 232).
As this determination falls within the equitable discretion of the trial court, this court engages in a narrow scope of review. Valentino v. Valentino, 309 N.J. Super. 334, 339 (App. Div. 1998). We will not substitute our judgment for that of the trial court, as "it is not the appellate function to decide whether the trial court took the wisest course, or even the better course." Gittleman v. Cent. Jersey Bank & Trust Co., 103 N.J. Super. 175, 179 (App. Div. 1967), rev'd on dissent on other grounds, 52 N.J. 503 (1968). Rather, "[w]e must decide whether the trial court mistakenly exercised its broad authority to divide the parties' property or whether the result reached was bottomed on a misconception of law or findings of fact that are contrary to the evidence." Genovese, supra, 392 N.J. Super. at 223.
Judge Holden found defendant's 401(k) plan to have a value of $62,203 on June 30, 2005. He ordered one-half of that value distributed to plaintiff. Defendant argues that the award was improper because the fund only contained half of that value "around" the time plaintiff filed the complaint, which was December 1, 2004. Although the court's decision to use June 2005 as the valuation date was not correct, we nevertheless find no basis for reversible error. The record does not disclose the pension's value as of December 1, 2004. The sole financial statement shows an opening balance on October 1, 2004 of $58,004.83 and a closing balance on December 31, 2004 of $61,549.06. From this information, it is reasonable to infer that the value on December 1 was slightly more than $60,000. The trial court's valuation of this asset for equitable distribution purposes does not deviate from this value to such an extent as "to offend the interests of justice," Rova Farms Resort, Inc. v. Investors Ins. Co. of Am., 65 N.J. 474, 484 (1974), and we will not disturb the result. We are mindful that the judge was dealing with incomplete, conflicting, and, at times, unreliable information. The valuation here was substantially consistent with the trial evidence.
Regarding the loan, the financial statement reflects a $30,450 loan during the period from October 1 to December 31. Defendant relies on this loan to challenge the trial court's valuation and equitable distribution of this asset. However, the loan occurred after the filing of the complaint and after the effective end of the marriage. Defendant received the loan on December 7, 2004 and allegedly later moved the funds to a separate account in connection with the closing on the Florida property. Because this loan fell after the valuation date, the judge correctly did not consider it.
With respect to the 401(k) account, defendant lastly argues that the judge erred in failing to consider the tax consequences of the proposed distribution to each party, see N.J.S.A. 2A:34-23.1j, and thus, did not award him fifty percent of the pension fund. This is because the judge ordered the payment of "pre-tax 401(k) monies with after-tax dollars" without proper adjustment. We reject this argument because the division of this asset can be accomplished without incurring any tax consequences with the use of Qualified Domestic Relations Order or, if permitted, a rollover order.
With respect to the Commerce bank account, defendant argues there was no factual basis for the judge's valuation of this "secret" account at $112,000 or the conclusion that defendant improperly transferred this amount for non-marital purposes. Based upon bank records, the judge found that between 2003 and 2005, $112,000 of marital funds were secretly deposited into the account. Thus, the court awarded plaintiff $56,000 for these improperly transferred and secreted funds.
Defendant claimed that he used the deposited funds for marital purposes, including the down payment on the Florida property and renovation of marital homes in New Jersey. When the judge requested documentation to verify these expenses, defendant's counsel admitted the failure to comply with discovery demands for such documents. Defendant also admitted on cross-examination that the exhausted lines of credit, not this bank account, provided the source for the remodeling.
Under the circumstances, the judge was confronted with a difficult situation in which he had to determine the final destination of these marital assets without any documentary evidence as to their use. Defendant did not cooperate with discovery. From plaintiff's perspective, there is an obvious proof problem regarding disposition of funds from an account for which the other party has sole possession of the documents pertaining to the account and refuses to disclose them, despite the court's threat of contempt. An adverse inference against defendant would naturally and reasonably occur in these circumstances, and we find no error in the court's treatment of this asset.
However, in addition to awarding plaintiff one-half of the $112,000 in marital assets dissipated through this account, the judge also awarded plaintiff one-half of $18,000 in wire transfers by defendant to Hungary from this account. This was apparently an inadvertent oversight by the court and constituted an improper double counting of the wire transfers as a separate asset. Morsemere Fed. Sav. & Loan Ass'n v. Nicolaou, 206 N.J. Super. 637, 645 (App. Div. 1986). On this limited point, we remand for entry of an amended judgment of divorce to modify the judgment by deleting the $9000 award to plaintiff attributable to the wired funds.
Finally with respect to equitable distribution, we reject as lacking sufficient merit to warrant discussion in a written opinion defendant's argument that plaintiff was improperly awarded one-half of the $3000 he received through a surreptitious routing arrangement through relatives in Hungary of the $3000 payment to his company by or on behalf of Talnai.
Defendant challenges the counsel fee award on two grounds.
First, he argues that because in his initial oral decision on June 1, 2006, the judge awarded sixty percent of plaintiff's "outstanding" counsel fees, the award should be limited to the amount due at that time, not the total fees she incurred in the litigation. Second, defendant argues that the judge failed to articulate adequate reasons for the counsel fee award and that the award was a mistaken exercise of discretion. We disagree.
At the reconsideration motion, the judge reaffirmed that the award, as written in the June 1, 2006 order, was sixty percent of plaintiff's counsel fees, not merely her outstanding counsel fees. No remand is necessary to clarify this issue.
With respect to the amount of the award, we are satisfied that the judge provided a sufficient explanation of the factual basis for the award, giving due consideration to the relevant factors set forth in N.J.S.A. 2A:34-23 and Rule 5:3-5(c). We are also satisfied, contrary to defendant's argument, that the fee application was in proper form, containing a certification of counsel setting forth his hourly rate and an itemized list of services rendered. Our standard of review on a counsel fee award is limited to whether or not the award constituted a mistaken exercise of discretion. Martindell v. Martindell, 21 N.J. 341, 356 (1956). Our review of the record satisfies us that defendant's arguments regarding the counsel fee award are unpersuasive, the award is well supported by the record, the judge considered all appropriate factors, and the judge properly articulated his findings in support of the award. We have no occasion to interfere.
The matter is remanded for the limited purpose of amending the judgment of divorce to delete the $9000 award to plaintiff as equitable distribution attributable to the $18,000 in wired bank funds. In all other respects, the judgment of divorce and the order denying defendant's motion for reconsideration are affirmed.
Affirmed as modified.
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