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Schmitt v. Schmitt

SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION


August 6, 2008

KARL G. SCHMITT, PLAINTIFF-RESPONDENT,
v.
LISA M. SCHMITT, DEFENDANT-APPELLANT.

On appeal from Superior Court of New Jersey, Chancery Division, Family Part, Essex County, Docket No. FM-07-2553-06.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued July 21, 2008

Before Judges Graves and Yannotti.

Defendant Lisa M. Schmitt (defendant, or the wife) appeals from an order dated November 2, 2007, which denied her "Motion For Reconsideration Of What The Parties Agreed To In Their Settlement Agreement Of April, 30, 2007 Regarding Support Of Defendant Pending The Sale Of The Marital Home." The same order awarded counsel fees to plaintiff Karl G. Schmitt (plaintiff, or the husband) in the amount of $2500. After reviewing the record and applicable law in light of the arguments advanced by counsel, we reverse and remand for a plenary hearing. The parties were married on November 11, 1994. They have two children: a daughter, born on August 26, 1996, and a son, born August 3, 1999. Prior to their divorce, the parties entered into an "Ad Interim Order" (consent order) on May 18, 2006, which provided for the sale of the marital home. In addition, paragraphs twelve and thirteen of the consent order read as follows:

12. Karl Schmitt will continue to pay property tax, and all household bills, including but not limited to: the mortgage payable to his parents (the paternal grandparents) should they so require such payment so that the marital home does not go into foreclosure, PSE&G bill, phone bill, satellite/cable television bill, DSL bill and water bill, without prejudice to any future application by the parties. . . .

13. Karl Schmitt agrees to pay $200.00 per week to Lisa Schmitt as unallocated support, without prejudice, and with the understanding that such funds will be used in part to pay for food for the children, transportation costs for the children, and the children's clothing, without prejudice for further application by either party.

On April 30, 2007, the day their divorce trial was scheduled to commence, the parties negotiated an oral agreement, which was placed on the record. During that proceeding, counsel for the wife stated: "the present order of support will continue until the closing of the house. And Mr. Schmitt will mail the supports checks on Thursday, so that Mrs. Schmitt can get them Friday or Saturday." In addition, defendant's attorney advised the court that "other than the visitation schedule, everything else will remain until the closing of the house, other than the car insurance and health insurance."

A Final Judgment of Divorce, which did not contain the terms of the oral agreement, was entered on May 4, 2007, and the parties were directed to prepare and submit an Amended Judgment of Divorce, setting forth the terms of the settlement. See R. 5:5-9 ("When a settlement is placed on the record and a judgment of divorce is entered orally, a contemporaneous written final judgment of divorce shall be entered . . . ."); see also Entress v. Entress, 376 N.J. Super. 125, 134 (App. Div. 2005) (appending transcript of oral settlement agreement to order violates Rule 4:42-1(a)(4); rather parties must "reduce their agreement to writing"). While the parties were in substantial agreement regarding the terms of their settlement, plaintiff claimed he did not agree to continue paying the mortgage, taxes, and other household expenses as outlined in paragraph twelve of the consent order, pending the sale of the marital residence. The parties sought guidance from the court and were told to submit a proposed Amended Judgment of Divorce together with a transcript of the court proceedings on April 30, 2007. Without oral argument or a hearing, the court issued a letter on August 1, 2007, which included the following:

The [c]court has reviewed submissions from both counsel as well as the transcript of the proceeding in order to determine the terms of the Final Judgment of Divorce.

It appears that the difficulty in resolving the problem is that neither party addressed the issue of the construction of Paragraph 12 of the May 18, 2006 pendente lite [o]rder post-divorce and prior to the sale of the marital home.

Paragraph 12 essentially compels the

[p]laintiff to pay not only the mortgage and taxes but all household bills including utilities, etc. To have [p]laintiff continue to do so post-judgment while [d]efendant has the exclusive use and enjoyment of the property is unfair, especially in light of the fact that there still is no contract of sale [for the marital residence].

In light of the above, the [c]court orders that retroactive to May 1, 2007,

[p]laintiff will continue to be responsible for payment of all expenses pursuant to Paragraph 12 of the May 18, 2006 [o]rder. However, as to the payment of the mortgage, taxes and insurance, [p]laintiff is entitled to be reimbursed 1/2 of the same from

[d]efendant's share of the proceeds of sale; as to the other household expenses set forth in Paragraph 12, [p]laintiff will be reimbursed for the entire amount to be paid from [d]efendant's share.

On August 1, 2007, the court entered an Amended Judgment of Divorce, which included the following paragraph:

22. The plaintiff will continue to pay for all expenses in connection with the marital home set forth in para. 12 of the May 18, 2006 order subject to his being reimbursed from defendant's share of the net proceeds of sale as follows:

A. 50% of the mortgage, taxes and insurance payments.

B. 100% of all other payments.

Defendant filed a notice of motion for reconsideration on August 17, 2007. With respect to paragraph twenty-two, which the court added to the Amended Judgment of Divorce, defendant's attorney certified "the parties never agreed to such an arrangement," but rather intended "that plaintiff would continue to provide support to defendant by payment of the mortgage, taxes, insurance and house-hold bills until the sale and closing of title to the marital home." Defendant also certified: "what I agreed was that [plaintiff] would continue paying the bills for maintaining the marital home as he had been paying up to that point until the marital home was sold and I would receive a minimum of $292,500.00."

Following oral argument on October 5, 2007, the court stated:

Now, what happened in this case was not anticipated by the parties. There was a provision in the Judgment of Divorce for the sale of the marital home. . . . There is an anticipation that the house was going to be sold in [a reasonable] time frame. That they made no provisions for the interim from the Judgment of Divorce and the actual sale of the marital home for the responsibility of continuing the expenses in connection with the marital sale, such as . . . utilities, things of this nature. And, of course, even the mortgage, taxes, insurance payments.

So, here are the options of the

[c]court. I can order a plenary hearing where the parties would spend another $10,000 or I can make the call myself. A call, quite frankly, [which] is not only in my judgment fair, it's almost boilerplate.

The defendant, fortuitously, has the use and enjoyment of the house. Neither one is responsible for the house not being sold. So isn't it fair, that there comes a point where he is paying everything that he should be reimbursed for one-half only because he gets the appreciation of the mortgage, interest and taxes. And he should be reimbursed for 100 percent of the utilities.

So the [c]court, in exercise of its discretion, didn't need a . . . hearing. It didn't need any additional facts. I had the Case Information Statements. I had the position papers. I was ready to try the case. So what would [a] . . . hearing serve except . . . to fill the pockets of attorneys . . . and exhaust the already limited resources of the [c]court?

In sum, according to the court, it "filled the gap that

[the parties] omitted." Additionally, the court awarded counsel fees to plaintiff:

THE COURT: Well, you know what? I've had enough. Take it to the Appellate Division . . . . I believe not only . . . am I right, not only is the record complete, but I'm going to award [c]counsel fees to the plaintiff for this motion to be taken from the proceeds of sale of the marital home.

[COUNSEL FOR DEFENDANT]: Based upon . . . what grounds, Your Honor?

THE COURT: On the grounds that I think this . . . motion has no substantiation.

[COUNSEL FOR DEFENDANT]: This is frivolous? . . . .

THE COURT: Yes.

The trial court entered an order on November 2, 2007, which denied defendant's motion for reconsideration, and awarded plaintiff $2500 in counsel fees.

It is well settled that the factual findings of a trial court "are considered binding on appeal when supported by adequate, substantial and credible evidence." Rova Farms Resort, Inc. v. Investors Ins. Co. of Am., 65 N.J. 474, 484 (1974). In matrimonial matters, deference is especially appropriate "[b]ecause of the family courts' special jurisdiction and expertise." Cesare v. Cesare, 154 N.J. 394, 413 (1998). Here, however, our review of the record leads us to conclude that the trial court erred in failing to conduct a plenary hearing.

Of course, a plenary "hearing is not required or warranted in every contested proceeding for the modification of a judgment or order." Murphy v. Murphy, 313 N.J. Super. 575, 580 (App. Div. 1998). On the other hand, "[d]isputes of material fact should not be resolved on the basis of certifications nor in reliance upon ambiguous terms in [the parties'] agreement. When a genuine issue of material fact exists, a plenary hearing is required." Palmieri v. Palmieri, 388 N.J. Super. 562, 564 (App. Div. 2006) (citation omitted); see also Harrington v. Harrington, 281 N.J. Super. 39, 47 (App. Div.) (Our courts "have repeatedly emphasized that trial judges cannot resolve material factual disputes upon conflicting affidavits and certifications."), certif. denied, 142 N.J. 455 (1995). When parties are in disagreement over the meaning of terms in a divorce agreement, the onus falls on "the trial judge to discern the parties' intent at the time of the divorce by probing their positions at an evidentiary hearing." Pacifico v. Pacifico, 190 N.J. 258, 267 (2007).

In the present appeal, the parties dispute the meaning of the statement by defendant's that "the present order of support [would] continue until the closing of the house." Defendant contends this statement was meant to preserve her rights under paragraph twelve of the consent order dated May 18, 2006. Plaintiff, on the other hand, contends this statement "plainly refers to child support." Thus, the court erred in resolving the disputed issue without holding a plenary hearing. We also reverse the award of counsel fees to plaintiff. In awarding counsel fees, courts must "consider the factors set forth in the court rule on counsel fees [Rule 5:3-5(c)], the financial circumstances of the parties, and the good or bad faith of either party." N.J.S.A. 2A:34-23. Moreover, "counsel fees unsupported by any findings of fact" cannot stand. Wolfe v. Malberg, 334 N.J. Super. 630, 638 (App. Div. 2000). Because the counsel fee award to plaintiff is unsupported by the requisite findings, and defendant's motion for reconsideration was not frivolous, we reverse.

Reversed and remanded for a plenary hearing. We do not retain jurisdiction.

20080806

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