May 30, 2008
THOMAS CRABE, PLAINTIFF-APPELLANT,
MARY CRABE, DEFENDANT-RESPONDENT.
On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Morris County, Docket No. FM-14-1023-02.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted May 7, 2008
Before Judges Simonelli and King.
Plaintiff, Thomas Crabe, appeals pro se from part of a May 16, 2007 order of the Superior Court, Chancery Division, Family Part, directing him to continue paying $2418 per month in alimony and child support. Plaintiff argues that the May 16, 2007 order is inconsistent with a prior order of November 3, 2006, which stated that he had demonstrated a substantial change in circumstances.
We agree with plaintiff that the November 3, 2006 order appears inconsistent with the May 16, 2007 order. Although this standing alone may not be enough to sustain a remand, we find that there are genuine issues of fact with respect to plaintiff's ability to continue paying $2418 per month in alimony and child support. Thus, we remand for a plenary hearing on the issue of modification.
Plaintiff and defendant, Mary Crabe, were married in a religious ceremony in Bayonne on December 27, 1980. Two children were born of the marriage: Matthew on October 8, 1982, and Alexandra on May 8, 1987. During the marriage, plaintiff worked in the property management field. He earned about $80,000 a year, while defendant was primarily a homemaker.
Problems began in April 2000. After a failed attempt at reconciliation, plaintiff left the marital home on July 4, 2001, and eventually filed for divorce. The parties entered into a property settlement agreement (PSA) on January 23, 2003. The PSA provided that defendant would have primary residential custody of the children. Plaintiff was to pay $1500 per month in alimony and $1500 in child support. He was also to pay 65% of unreimbursed medical expenses and 50% of college expenses for both children.
At the time the parties entered into the PSA in 2003, plaintiff was no longer regularly employed due to his alleged disability.*fn1 He was, however, anticipating a rather significant inheritance from his mother's estate. Given these circumstances, the parties included the following stipulation in the PSA:
At the time of entering into this Agreement, the Husband is unemployed and anticipates receiving interest income from an inheritance. The Wife is employed as a per diem visiting nurse whose work fluctuates depending upon assignment from her employer. Therefore it is difficult to estimate incomes and therefore stipulate an appropriate allocation between alimony and child support. Accordingly, the parties stipulate that of the monthly support payment, $1,500.00 shall be allocated for alimony and $1,500.00 shall be allocated for child support. With respect to any future review, the allocation of support shall be considered but not controlling as to future adjustments. At the time of review, the parties shall consider their respective incomes and assets and college obligations.
As to the timing of this future review, the PSA further provides:
In the event of the emancipation of one of the children, child support shall be adjusted and reduced accordingly. Similarly, in the event the parties' daughter, Alexandra attends residential college away from home, at the option of either party, the support contained herein shall be reviewed. There shall be a review in five (5) years from the date of this Agreement as to the appropriate level of support to be paid. [(Emphasis added).]
Three and a half years later, on June 9, 2006, the parties entered into a consent order in which they agreed to the emancipation of their son, Matthew, no longer attending college. They also agreed to reduce plaintiff's support arrears to $0 and his total monthly support obligations to $2418. According to defendant, plaintiff made no mention of his inability to pay the $2418 during the parties' negotiations.
Shortly after this, in July 2006, the Social Security Administration (SSA) granted plaintiff's request for disability benefits and awarded him $1330 per month ($15,960 per year). The SSA determined that plaintiff had been disabled since April 2001. In August 2006 the SSA informed plaintiff that $798 would be withheld from his disability benefits to pay his child support and alimony obligations.
On August 23, 2006 plaintiff filed a motion to terminate alimony and decrease child support based on a substantial change in circumstances. Defendant filed a cross-motion for payment of support arrears and tuition and medical reimbursement.
On October 6, 2006, after considering the parties' moving papers, the judge denied plaintiff's motion without prejudice. The Statement of Reasons accompanying the order provides in pertinent part:
The movant bares [sic] burden of showing substantial and permanent changed circumstances before entitlement to modification. Lepis v. Lepis, 83 N.J. 139 (1980); Bonanno v. Bonnano, 4 N.J. 268 (1950).
. . . While the [plaintiff] has made a prima facie showing of changed circumstances as required by Lepis, the Court may look to other assets including an inheritance to determine whether the plaintiff, notwithstanding his changed circumstances, can contribute to child support and to his alimony obligation. In this regard, the Court has reviewed the Case Information Statement provided by the plaintiff. The Court finds that it is inadequate in terms of information provided to the Court relative to assets. Further, it has been argued by the defendant that plaintiff has considerable assets he received as a result of an inheritance. As such, the true measure of his assets are unknown. Thus, while the plaintiff may have met his burden relating to changed circumstances, he has not met his burden as to whether this has rendered him financially incapable of making his support obligations both by way of alimony and child support. Since child support is for the benefit of the child, the Court is particularly mindful of determining whether a parent has an ability to provide support. It is for this reason that the motion is denied without prejudice. [(Emphasis added).]
As a result, the judge ordered both parties to submit an updated case information statement (CIS) within fourteen days of the filing of the order. He granted defendant's motion for support arrears and tuition and medical reimbursement.
On November 3, 2006 the judge issued an amended order.*fn2 He did not change his basic decision denying plaintiff's motion without prejudice. He did, however, add the following Statement of Reasons:
The Court has denied the Plaintiff's request to terminate his alimony obligation because the Court finds that although there has been a permanent and substantial change in circumstances, the parties property settlement agreement is silent as to the time or events in which the parties have agreed to either terminate or recalculate the amount of alimony the Plaintiff is obligated to pay.
The Court has granted the Plaintiff his request to have his child support obligation recalculated based on the Plaintiff providing [sufficient] evidence of a substantial and permanent change in circumstance. The Plaintiff has provided the court with evidence of his permanent disability and the effect it has had on his income. However, the Court cannot determine an amount in the absence of an updated Case Information Statement by the Defendant. The Court has ordered that the Defendant submit an updated case information statement within 14 days of the filing date of this Order. [(Emphasis added).]
The judge again ordered both parties to submit an updated CIS within fourteen days of the filing of the order. The judge also corrected part of his prior order which incorrectly designated $8750 as tuition reimbursement, instead of support arrears.
On October 26, 2006, before the amended order was issued, plaintiff filed a motion for reconsideration of the October 6, 2006 order. In an accompanying certification, plaintiff stated that he is 100% disabled and that his only source of income is his social security benefits. He has two young children, ages two and four, the youngest of whom suffers from autism. Each child receives $661 per month as social security derivative benefits. As to the inheritance he received, plaintiff explained:
The inheritance is long gone and was used up to pay support prior to and after the divorce, living expenses, legal fees and a restitution payment resulting from a criminal charge against me. I have no money remaining from my inheritance and my only source of income is my social security disability. Any assets I had were sold just to survive and support my family. In addition, I have no equity in my home; it has a mortgage for the full purchase price.
Plaintiff attached to his certification a CIS dated October 24, 2006, and marked it as exhibit "D." In the CIS, plaintiff listed his total earned income as $0, and his total unearned income as $5320, which represented his monthly disability benefits to date. He checked the boxes marked "no" beside the following questions: "Do you receive cash or distributions not otherwise listed?" and "Have you received any other supplemental compensation during either the current or immediate past calendar year?" Plaintiff listed as an asset an $85,000 house, which he "jointly owned" with Joan Johnston. Plaintiff stated that he still owed $84,500 on the mortgage. Plaintiff listed his total net worth as only $500. Plaintiff also listed as assets a 1997 Nissan and 2005 Scion; their value was "unknown." Plaintiff stated that he paid $325 a month for the Scion, but did not list the amount still owed on the vehicle. The updated CIS did not contain any information regarding assets he received as a result of his inheritance.
On about November 8, 2006 defendant filed a cross-motion in response to plaintiff's motion for reconsideration. In an accompanying certification, defendant alleged that plaintiff had concealed information from the court regarding a substantial inheritance that he received in 2003. In support of this allegation, defendant submitted a May 30, 2002 letter from the Virginia attorney managing plaintiff's mother's estate. The attorney estimated the value of the estate, including real estate and personal bank accounts, to be $481,200. Plaintiff's mother also set up a living trust and transferred some of her assets, including a Charles Schwab brokerage account valued at $446,844.16, into that trust. Plaintiff was to inherit one-half of the trust, as well as two-thirds of the other assets.
Defendant also submitted copies of two real estate transactions, which purportedly show the November 19, 2002 sale of plaintiff's mother's real property to a third party for $399,500, and the December 28, 2004 sale of plaintiff's home that he purchased with his companion, Joan Johnston, for $290,000. Defendant further explained:
Plaintiff received as part of his inheritance property located at 2517 North Kenilworth Street in Arlington, Virginia and sold this property for $399,500.00 on 11/19/2002, immediately prior to the divorce. . . .
During negotiations prior to the property settlement it was requested that Plaintiff pay off the mortgage on the marital home at Budd Lake Heights Road, Budd Lake, NJ in exchange for a substantial reduction in monthly support payments. The Plaintiff did not agree to do this and instead, agreed to pay a support amount that would allow me to remain in the marital home with my children. The subsequent agreement made me heavily reliant on Plaintiff for monthly support payments. Alternatively, had Plaintiff settled on the lump sum, I could have paid my mortgage off, and would no longer be dependent on continued support from Plaintiff.
Monies received by the Plaintiff from his inheritance also enabled him to purchase a home at 30 Shin Hollow Road, Port Jervis, NY on October 7, 2002. The Plaintiff certified that he paid $225,000 for this property in a motion dated October 20, 2004.
He paid cash and carried no mortgage.*fn3 The Plaintiff and his paramour Joan Johnston lived in this home until the house was sold on December 28, 2004. . . . The Plaintiff made a profit of $75,000 from the sale of this home. There is no accounting for these proceeds in the Case Information Statement. [(Emphasis added.)]
Finally, defendant alleged in her certification that plaintiff may have transferred assets to Johnston. She points out that nine days after defendant and Johnston received $290,000 from the sale of their first home, the couple purchased another home for $82,000. Defendant questions how their new home could be mortgaged for the full purchase price after they had just sold their prior home, for which they paid cash, for $290,000. The public record also lists Johnston as the sole owner of the couple's new home, which conflicts with plaintiff's statement in his CIS that he jointly owned the property with Johnston.
On December 1, 2006 the judge, having considered the parties' moving papers, denied plaintiff's motion for reconsideration in its entirety, and ordered plaintiff to continue paying his alimony and child support obligations.
Without mention of the November 3, 2006 amended order, the judge affirmed his prior order of October 6, 2006, and provided the following statement of reasons:
The Court has denied the Plaintiff's request to terminate his alimony because the movant bears the burden of showing substantial and permanent changed circumstances before the movant is entitled to a modification of a support award. See Lepis v. Lepis, 83 N.J. 139 (1980); Bonanno v. Bonanno, 4 N.J. 268 (1950). The Court finds that the Plaintiff has not provided sufficient evidence of a substantial and permanent change in circumstances and therefore the Court has denied the Plaintiff's relief.
Following the judge's decision, defendant filed a motion for enforcement of litigant's rights on about December 19, 2006. She requested that the judge enforce his prior order directing defendant to pay $8785 in support arrears, $887 in tuition reimbursement, and $650 in medical reimbursement.
Plaintiff filed a certification in reply on January 23, 2007. He stated he did not have the funds to pay the arrears, but that he was paying his monthly obligations via income withholding. Plaintiff requested that he be allowed to pay the arrears upon receipt of a lump sum payment he expected from the SSA. He added that he paid the $887 for tuition reimbursement, rendering that issue moot.
On February 2, 2007 the judge issued yet another order directing plaintiff to pay $8785 in support arrears within a month of the order and $620 in medical reimbursement within twenty days. He found defendant's request for $850 for tuition reimbursement to be moot. The judge added the following statement of reasons:
The Court has reviewed the parties' motion papers and orders that the Plaintiff pay his support arrears within one month of the stamped filed date of this Order. The Court finds that the Plaintiff has the ability to [pay] the required payments within the time period ordered by the Court. If the Plaintiff cannot make such payments, he is entitled to file a motion setting out a payment plan that makes reasonable efforts to satisfy the support arrears that the Defendant is entitled to. If the Court finds that the Plaintiff has failed to make a good faith attempt to satisfy his arrears prior to filing, the Court will deny his request and order that the Plaintiff pay his arrears in full within days of the Court's decision. [(Emphasis added.)]
On March 16, 2007, in response to the judge's order, plaintiff filed a motion to institute a payment schedule. On April 1, 2007 he filed a motion to emancipate his daughter, Alexandra. On April 9, 2007 he apparently filed yet another motion, presumably to recalculate his support obligations. A copy of that last motion is not included in the appellate record.
Defendant filed a cross-motion on April 24, 2007 asking the judge to deny the motion to emancipate Alexandra and to enforce litigant's rights. Specifically, defendant requested that plaintiff pay an additional $325 for medical expenses, $1316.50 for half of the deposit for Alexandra's culinary school, and $11,850 for half of Alexandra's tuition.
On May 16, 2007 the judge consolidated these various motions and issued an order directing plaintiff to continue paying $2418 per month in alimony and child support. The judge further ordered that plaintiff pay an additional $500 per month toward his support arrears in the amount of $21,816. The judge explained:
Child Support & Alimony
The Court orders the Plaintiff to continue making his child support and alimony payments in the amount of $2,418 per month. The Court cannot modify the Plaintiff's obligation in the absence of a change in circumstances or a consent order signed and agreed to by both parties. The Court is aware of the arrears in the amount of $21,816 and orders the Plaintiff to pay an additional $500 per month until his arrears is satisfied.
The judge denied plaintiff's motion to emancipate Alexandra, finding that her vocational training constitutes secondary education for which plaintiff is still responsible. The judge granted defendant's motion for $350 in medical reimbursement and $13,166.50 in tuition expenses, provided that defendant submit to plaintiff of Alexandra's enrollment. And, finally, the judge denied the parties' request for oral argument.
On June 29, 2007 plaintiff filed a notice of appeal. He also filed a motion for leave to appeal as an indigent, which was granted on August 1, 2007.
Plaintiff argues on this appeal that the judge's order of May 16, 2007 directing him to continue paying $2418 per month in alimony and child support, is inconsistent with his prior order of November 3, 2006 which stated that he had demonstrated a substantial change in circumstances. Plaintiff further argues that the judge never reevaluated his support obligations despite its findings on November 3, 2006.
Agreements between divorcing spouses as to alimony and child support are always subject to review and modification based on a showing of changed circumstances. Lepis v. Lepis, 83 N.J. 139, 145-49 (1980); Berkowitz v. Berkowitz, 55 N.J. 564, 569 (1970). The party seeking modification has the burden of showing such changed circumstances to warrant relief from their current support obligations. Lepis, supra, 83 N.J. at 157. When a supporting spouse brings an application for a downward modification of support, the main focus is the supporting spouse's ability to pay. Miller v. Miller, 160 N.J. 408, 420 (1999). In determining whether a downward modification is appropriate, the judge may consider the supporting spouse's income, as well as the respective assets. Id. at 422.
On October 6, 2006 the judge denied plaintiff's request for modification of alimony and child support without prejudice. The judge found that although plaintiff had made a prima facie showing of changed circumstances, he had not yet demonstrated his inability to pay. The CIS that plaintiff submitted was deficient because it did not contain sufficient information regarding his assets, including assets he may have received from his mother's estate. The judge ordered both parties to submit an updated CIS within fourteen days.
Defendant submitted an updated CIS and plaintiff submitted an updated CIS along with his motion for reconsideration. It is unclear whether the judge had access to those documents when he issued an amended order on November 3, 2006.
Under the November 3, 2006 amended order, all aspects of the prior order remained intact with the exception of the $8750 award for tuition which was changed to $8570 for support arrears. The judge then provided a totally different statement of reasons in support of his decision denying plaintiff's request for modification of his support obligations. As to alimony, the judge stated that he could not reevaluate alimony because the PSA did not provide a date upon which to do so. This was not accurate because the PSA stated that plaintiff's support obligations would be reevaluated within five years, and because support obligations are always subject to review based upon a showing of changed circumstances. Lepis, supra, 83 N.J. at 146. As to child support, the judge found that plaintiff had provided sufficient evidence of a substantial and permanent change in circumstances, but stated that it could not make such a determination without an updated CIS from defendant. We question whether this was a typographical error because at the time of the amended order, we do not think the judge rendered this decision based on plaintiff's updated CIS. Nevertheless, this statement left plaintiff with the impression that he had sustained his burden of showing a substantial change in circumstances, and that he was merely waiting on defendant to provide her financial information.
The judge then issued an order on December 1, 2006 denying plaintiff's motion for reconsideration of its October 6, 2006 order. At that time, the judge had at its disposal an updated CIS from each party, as well as certifications, and other data. Based on this information, the judge stated that plaintiff had not met his burden of showing a substantial change in circumstances. He then affirmed his prior order of October 6, 2006, which required plaintiff to submit sufficient evidence regarding his ability to pay. However, the judge made no mention of the November 3, 2006 order.
In this circumstance we conclude that the best resolution is a remand for a plenary hearing on the issue of modification of alimony and child support because of the inherent confusion created by the various orders and because there certainly are genuine issues in dispute. See R. 5:5-4. This result comports with the parties' intent expressed in the PSA, which provides that plaintiff's support obligations be reviewed within five years anyway. A plenary hearing should clarify a rather murky situation and perhaps provide finality.
Remanded for a plenary hearing.