August 15, 2008
EUGENE HARVEY WOLKOFF, PLAINTIFF-RESPONDENT,
ARLETTE SARFATI WOLKOFF, DEFENDANT-APPELLANT.
On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Union County, Docket No. FM-0010-85.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued May 28, 2008
Before Judges Winkelstein and LeWinn.
Defendant Arlette Wolkoff appeals from the Family Part's January 29, 2007 order denying her request to increase the alimony and life insurance obligations of plaintiff Eugene Wolkoff, as well as her request for counsel fees.
The parties were married in 1971. Three children were born of the marriage, the youngest of whom is now twenty-eight years old. The parties were divorced on December 17, 1985. Their divorce judgment incorporated a property settlement agreement (PSA) whereby defendant received permanent alimony of $1150 per month and $900.00 per month in child support, subject to cost-of-living adjustments.
In 1989, defendant moved to increase alimony and child support claiming an increase in the children's needs; an increase in plaintiff's income; and her inability to contribute to her support as contemplated in the PSA. A plenary hearing was held on February 14, 1990, resulting in an order issued on May 21, 1990, increasing child support but denying all other relief. Upon plaintiff's motion to reconsider that order, the Family Part judge entered an order on July 27, 1990, reducing the amount of the child support increase and otherwise affirming plaintiff's support obligations.
In September 2004, defendant moved to compel production of plaintiff's tax returns from 1994 through 2003. Another Family Part judge entered an order requiring the parties to exchange their tax returns for 2001 through 2003.
On November 29, 2005, defendant filed a second motion to modify alimony based on a claim of changed circumstances. A third Family Part judge heard oral argument on February 10, 2006, and, on January 29, 2007, issued an order denying (1) defendant's request for an increase in alimony; (2) an increase in plaintiff's life insurance coverage; and (3) counsel fees.
On appeal, defendant raises the following issues for our consideration:
THE TRIAL COURT ERRED IN FINDING THAT THE MARITAL STANDARD OF LIVING WAS ESTABLISHED BY [THE 1990 JUDGE'S] DECISION, WHICH GRANTED THE DEFENDANT AN INCREASE IN CHILD SUPPORT BUT MAKES NO MENTION OF ALIMONY OR MARITAL LIFESTYLE.
THE TRIAL COURT ERRED BY FAILING TO RECOGNIZE DEFENDANT'S SUBSTANTIAL CHANGE IN CIRCUMSTANCES WARRANTING A MODIFICATION OF ALIMONY.
THE TRIAL COURT COMMITTED ERROR IN FAILING TO HOLD A PLENARY HEARING ON THE ISSUE OF RECALCULATION OF SUPPORT UPON THE EMANCIPATION OF THE CHILDREN, PURSUANT TO . . . [THE] DECEMBER 2004 ORDER.
THE COURT ERRED IN FAILING TO ENFORCE THE PARTIES' AGREEMENT AS TO THE PLAINTIFF'S LIFE INSURANCE OBLIGATION.
We concur with defendant that the Family Part judge did not establish the marital standard of living in 1990. We further concur with defendant's contention that the Family Part judge erred in failing to conduct a plenary hearing in 2006, based on defendant's claim of a change in circumstances. Therefore, we reverse the order of January 29, 2007, and remand for a plenary hearing. Because plaintiff's life insurance obligation is related to his alimony obligation, and because an award of counsel fees must abide final disposition of defendant's motion, we direct the trial court to re-visit those matters on remand.
A. The 1990 Hearing
In their motion papers as well as their testimony at the 1990 hearing, the parties presented conflicting views of the marital lifestyle.
The parties lived in Westfield, New Jersey, for the first ten years of the marriage. Throughout the marriage, plaintiff was employed by Merck and Company and/or its subsidiary. Defendant earned a bachelor's degree in architecture from the Pratt Institute in 1973, but remained unlicensed. Defendant was employed prior to the birth of the parties' first child in 1974. After the birth of their second child, defendant worked part-time as a draftsperson until becoming pregnant with the third child. Between 1980 and 1981, defendant worked as a building inspector for the town of Westfield.
In 1981, plaintiff's employer temporarily assigned him to Buenos Aires, Argentina, and the family moved there. The parties rented their Westfield home to a tenant during this time.
Defendant certified that, while living in Argentina, the parties rented a home for $6000 per month. She described the home as 6000 square feet in size, with five bedrooms, five bathrooms, two kitchens, a pool and a separate home for a live-in maid. Defendant certified that the parties belonged to a country club, dined out several times a week, employed a driver and a bodyguard, and had the children attend private school.
Defendant certified that the marital lifestyle was a privileged one even prior to moving to Argentina. While living in Westfield, according to defendant, the parties frequented the St. Regis Hotel in New York City and "dined out regularly and saw virtually every show on Broadway." Defendant certified that the parties traveled first class for plaintiff's business trips and "regularly stayed in the best hotels and resorts[.]" Moreover, defendant certified that the parties were able to amass savings.
In contrast, plaintiff certified that the marital lifestyle was "modest and not the exaggerated lifestyle set forth in [d]efendant's [c]ertification." According to plaintiff, when the family lived in Argentina, Merck and/or its subsidiary paid all of their rent except for approximately $800 per month. The parties were only able to maintain the Westfield residence by renting it out. Plaintiff contended that defendant's reference to the St. Regis Hotel was "a one-time perk provided for by [Merck]" because the parties were transitioning from Westfield to Argentina at the time.
The parties separated in late 1982, and executed their PSA on November 21, 1983. Defendant moved back into the Westfield home with the children upon the parties' separation. The PSA provided that plaintiff would pay defendant $900 per month in child support, allocated as $300 per child. The PSA provided that plaintiff's child support obligation would decrease by one-third upon each child's emancipation.
Regarding alimony, the PSA provided that plaintiff would pay defendant $1150 per month. The agreement provided further that if defendant could not "provide for her own support and maintenance upon the emancipation of the three children . . . the amount of support and maintenance [plaintiff] is then providing for [defendant] shall be renegotiated."
The PSA also provided that plaintiff would "continue to maintain [defendant] as a beneficiary of [a] term insurance policy as provided by his employer[.]" In the event of plaintiff's termination by Merck, the PSA obligated him to obtain a term policy in an equal amount naming defendant as beneficiary.
By way of equitable distribution, defendant received full interest in the Westfield residence. Plaintiff retained the parties' personal property located in the Buenos Aires home. The PSA provided that "[plaintiff] agrees to be responsible [for $1500 of defendant's legal fees in connection with the PSA and] for any additional legal fees in connection with any subsequent divorce proceedings."
Defendant certified that, since 1982, her employment was sporadic. She worked as an architect for the City of Jersey City in 1984 for less than one year, and later worked part-time for an architect in private practice until February 1986. After that employment, she had various non-architect related jobs, none of which lasted for any significant period of time.
Defendant certified that she could no longer work as an architect because she had difficulty concentrating. Defendant's treating physician, Dr. Paul Syracuse, testified that she had a diagnosis of "severe unipolar depressive illness."
In addition to testifying about the parties' marital lifestyle while they lived in Argentina, defendant also testified as to the children's and her then-current living conditions. Defendant submitted a case information statement (CIS) setting forth monthly expenses for herself and the three children of $6746. Notwithstanding that defendant listed these monthly expenses under the "marital lifestyle" column on the CIS (as opposed to the "current lifestyle" column), she testified that the reported expenses represented the "absolute minimum" she and the children could live on. The following colloquy ensued between defendant and her attorney:
Q: So you're saying that the standard of living reflected on Pages 4 and 5 of your Case Information Statement is even less than that you were able to enjoy during the marriage?
A: Yes, it is.
Q: Now, you updated your budget expenses from the prior Case Information Statement which you filed; correct?
Q: And what do these expenses as set forth on Pages 4 and 5 represent to you?
A: Probably the absolute minimum we could live on I suppose.
Plaintiff testified about his employment history, his tax returns, and his income. He also briefly testified about some conditions of the marital lifestyle, as noted.
In her decision of April 18, 1990, the trial judge set forth the following findings:
In establishing the elements of changed circumstances, the Court, in Lepis [v. Lepis, 83 N.J. 139 (1980)] recognized that an increase in the supporting spouse's income may warrant modification of support. Additionally, supporting spouses do have an obligation to contribute to the support of the dependent at the standard of living formally shared. However, after the elements of support and maintenance have been established, such factors alone will not justify a modification of support. Procedurally, not only does the party seeking modification have the burden of showing "changed circumstances," they also must demonstrate that changed circumstances have substantially impaired the party's ability to support himself or herself.
. . . [U]nder Lepis, notwithstanding that an increase in a supporting spouse's income is a "changed circumstance," this criteria alone will not warrant a modification of support. The defendant must allege with specificity the increase in her own and her children's needs.
The defendant is relatively young (forty years old) and skilled. Although she does offer evidence of major depressive illness and medical problems such as sacroileitis, the Court is not convinced that they are substantial enough that they thwart the defendant's ability to work in low-pressure positions on a part-time basis. Further, the Court finds that the defendant offers no evidence that she has made every attempt to seek such employment taking into consideration her physical and emotional disabilities.
. . . . The defendant offers no evidence that plaintiff is not substantially fulfilling [his] obligations. . . . [T]he Court is satisfied with the plaintiff's oral testimony during which he stated that he voluntarily paid for Bar Mitzvahs and Hebrew School. He also purchases clothes for the children, and sends $100.00 per month to the children as an allowance for lunch. The Court is satisfied that the plaintiff not only substantially fulfills his current obligations under the divorce judgment, but he voluntarily provides additional support as well. However, the Court does note the increased expenses for three children.
Accordingly, the defendant's request for modification is granted in part.
Plaintiff is ordered to pay $1500 additional support per month allocated as child support, effective October 27, 1989. This additional support shall be paid along with payments for Hebrew School, summer camps, school lunch, clothing and summer vacations.
It is further ordered that plaintiff shall pay to defendant the amount of $4000 for 1989 summer camp fees by June 1, 1990, if payment of said fees has not yet been made. With regard to legal fees, plaintiff shall contribute towards payment of defendant's legal fees in the amount of $5000. . . . All other portions of the Agreement incorporated into the Final Judgment of Divorce shall remain in effect, including the cost of living adjustment provision. . . .
It is further ordered that the defendant shall submit to the Court, on a monthly basis for a period of one year, proof of applications filed for part-time or full-time positions in which she could annually earn at least $8,000 to $9,000.
On June 27, 1990, the trial judge supplemented her decision, stating, in part:
In the opinion of April 18, 1990, the Court painstakingly examined both parties' case information statements which reflected their current expenses. The court also reviewed the case information statement submitted by the defendant in 1984, the basis of the pre-existing support arrangement. Based on the review of the case information statements, the court determined that there had been an increase in the children's needs between 1984 and 1990 which would justify the plaintiff contributing an increased amount of child support as calculated and set forth in the April 18, 1990 decision.
Plaintiff filed a motion to stay the portion of the order increasing his child support and ordering counsel fees. On July 27, 1990, the trial judge modified her prior order, notwithstanding her determination that plaintiff's motion had not been timely filed. The trial judge modified her order so as to eliminate or modify [her] Order to have Mr. Wolkoff pay the additional $1500 per month, to eliminate or modify the direction by the Court that voluntary payments heretofore made by the plaintiff to the defendant now be made mandatory. . . .
[T]o eliminate or modify that portion of the Order which directed plaintiff to pay the sum of $10,125 by no later than September 30, 1990 which represented the retroactive support from October 27, 1989. And, . . . to eliminate that portion of the Order with regard to the attorneys fees.
. . . . [This motion] will be granted in part. The $1500 per month amount shall now be reduced to $1,248 a month. This is based upon the fact that the Court has reviewed again the Case Information Statements for [defendant] and the children which were filed in 1984 against the Case Information Statement which was filed by Mrs. Wolkoff in 1990. . . .
The Court has now reviewed the 1990 adjusted net expenses for the children versus the 1984 net adjusted expenses for the children, and the difference is $1,248. The Court has determined that in its original decision and its modification that the Court overcharged [plaintiff], and that the appropriate amount that is necessary to cover the increased needs between 1984 and 1990 for the children is $1,248.
Therefore, the amount of $1500 per month additional support shall now be changed to read $1,248.
The trial judge's decision of May 21, 1990 (as modified) remained in effect until defendant's 2005 motion.
In 2000, the Social Security Administration (SSA) determined that defendant was permanently disabled as the result of a closed-head injury she had suffered in a 1989 automobile accident. The SSA determined that defendant's disability was effective as of March 1999 and, in March 2000, defendant began receiving Social Security Disability Insurance (SSDI) benefits of $524 per month.
B. The 2005 Motion
Defendant filed a CIS in support of her 2005 motion.
According to this CIS, defendant's net income for 2004 was $43,857. Her combined monthly expenses totaled $13,014. The expense figures were listed in the "current lifestyle" column rather than the "martial lifestyle" column, which was left blank.
At the conclusion of oral argument on February 10, 2006, the trial judge observed, regarding the prior judge's 1990 opinon:
Well, [the prior judge] in the opinion doesn't say a whole lot about alimony. Clearly, she denied an increase in alimony, but she doesn't do a lot of discussion about it. So I'm not sure how much I can take from [the prior judge] and say, yes, she made lifestyle determinations which weren't required at the time, and that she made other determinations that one might infer from some of the things that she's saying, but aren't stated. That's somewhat of a leap.
. . . . . . . I don't believe that there's sufficient basis in [the prior judge's] letter for me to conclude that she made that lifestyle determination to the extent that Crews [v. Crews, 164 N.J. 11 (2000)] would have required it. . . . And in dealing with legal issues, I'm going to have to reconcile those concerns if the case is not resolved.
The trial judge then ordered the parties to attend a Matrimonial Early Settlement Panel (MESP) in an effort to resolve the pending issues. When MESP proved unsuccessful, the judge issued an order on January 29, 2007, denying defendant's request for modification of alimony "without prejudice." Regarding life insurance, the order required plaintiff to continue to maintain a $500,000 policy on defendant's behalf "without prejudice to either party requesting modification of said amount upon submission of appropriate actuarial calculations." The judge also denied defendant's counsel fee request.
Notwithstanding his comments at the conclusion of oral argument, the trial judge found in his written decision that, "[h]aving reviewed various materials from the 1990 motion for modification . . . [he was] satisfied that the marital standard of living was adequately established at that time." The judge noted that defendant's CIS contained specific instructions to list expenses reflecting the "standard of living during the marriage," and that defendant's attorney, throughout the 1990 hearing, argued that defendant was entitled to be maintained at the marital standard of living "as reflected by her CIS."
The judge further concluded that the prior judge had analyzed the evidence and "largely accepted the figures presented by [d]efendant, and specifically noted those items that she found to be inflated." The trial judge found further that the judge in 1990 had established the marital lifestyle by relying "primarily upon [d]efendant's representation of the marital standard as reflected in her own CIS and made adjustments to [d]efendant's figures based upon the evidence presented at the 1990 hearing." The judge noted further that defendant's 2005 CIS listed expenses for her alone that "total nearly three times the amount found by [the prior judge] for defendant and the three children."
The judge ruled that defendant failed to meet her burden of establishing "changed circumstances that substantially impair" her ability to maintain the marital standard of living. The judge acknowledged plaintiff's increase in income, but concluded that defendant had failed to meet her burden of demonstrating "a particularized showing of [her] circumstances[,]" as required by Crews, supra, 164 N.J. at 32.
We acknowledge the deference generally accorded to the fact finding of Family Part judges, given their "special expertise" in the field of domestic relations. Cesare v. Cesare, 154 N.J. 394, 412-13 (1998). Where such fact finding is based upon competent substantial evidence of record, we will not disturb the result. Rova Farms Resort, Inc. v. Investors Ins. Co. of Am., 65 N.J. 474, 483-84 (1974).
However, where the trial court's fact finding is not so firmly derived from "competent substantial evidence of record[,]" we are not bound by those fact findings. Such is the case here. The fundamental flaw in the proceedings below is that the record is devoid of any meaningful judicial fact finding as to the parties' marital lifestyle. In Crews, supra, 164 N.J. at 17, the Supreme Court defined the standard for weighing an alimony modification request as "whether the supported spouse can maintain a lifestyle that is reasonably comparable to the standard of living enjoyed during the marriage."
We recognize that Crews was decided long after the decision of the 1990 judge. However, a comparable standard existed at that time pursuant to the mandate of Lepis, supra, providing that an alimony obligation is premised upon "the quality of economic life during the marriage" and that a supporting spouse has a "continuing obligation to contribute to the maintenance of the dependent spouse at the standard of living formerly shared."
83 N.J. at 150, 152. Applying that standard to the 1990 decision, we find no articulation of the actual "standard of living formerly shared" during the parties' marriage. The 1990 judge noted that she had "painstakingly examined both parties' case information statements which reflected their current expenses." (Emphasis added). That judge also reviewed defendant's 1984 CIS as "the basis of the pre-existing support arrangement." At no point, however, did the prior judge set forth any findings as to the marital lifestyle purportedly reflected in those case information statements.
The 2006 trial judge recognized this deficiency in the record at the conclusion of oral argument on February 10, 2006. That judge noted that the prior judge "denie[d] an increase in alimony, but she [didn't] do a lot of discussion about it." The judge concluded that it was "somewhat of a leap" to find that the prior judge had "made lifestyle determinations which weren't required[.]" Further, the judge noted "that where there is an alimony issue, the Court has to engage in a lifestyle determination."
Notwithstanding these statements, the 2006 trial judge made no independent findings in his written decision as to the parties' lifestyle. Rather, that judge stated that he was "satisfied that the marital standard of living was adequately established [in 1990]." The 2006 judge based this determination upon the 1990 judge's reliance on defendant's "representation of the marital lifestyle as reflected in her own CIS[.]"
However, as noted, in the 1990 hearing defendant clarified that the expenses listed in her CIS did not reflect the "marital lifestyle" despite the column in which those expenses were listed on the form. Rather, those CIS expenses reflected the "absolute minimum" she and the children were able to subsist on at that time. The judge's conclusion also ignored the significant discrepancy between the parties' respective depictions of the marital lifestyle in their 1990 motion -- a discrepancy that was never resolved by either court.
In the absence of any definitive finding as to "the standard of living enjoyed during the marriage[,]" Crews, supra, 164 N.J. at 17, we conclude that the order denying defendant's request for modification of alimony is fatally flawed. Therefore, we remand for a hearing to determine this standard.
We further remand for reconsideration of defendant's claim of "changed circumstances" warranting modification of alimony. Defendant contends that the SSA's 2000 determination that she is permanently disabled constitutes a change in circumstances warranting an increase in support. Plaintiff contends that the existence of defendant's disability was presented to the prior judge in 1990 and, therefore, defendant has failed to establish a prima facie change of circumstances. In 1990, defendant's evidence "of major depressive illness and medical problems such as sacroileitis" led that judge to conclude that "they are [not] substantial enough that they thwart the defendant's ability to work in low-pressure positions on a part-time basis." However, the 2000 SSA determination that defendant is permanently disabled impacts that finding.
Defendant contends that, although the automobile accident that caused the closed head injury occurred before the 1990 hearing, the "full magnitude and extent of [her] injuries [were] not immediately known" at that time. We have recognized that the deterioration of a pre-existing medical condition constitutes "a change in circumstances which substantially impair[s a supported spouse]'s ability to support herself." Adler v. Adler, 229 N.J. Super. 496, 500 (App. Div. 1988).
An SSA adjudication of permanent disability may, in certain circumstances, constitute a prima facie showing in a matrimonial action that a party is disabled and therefore "unable to be gainfully employed[.]" Golin v. Golin, 344 N.J. Super. 337, 342-43 (App. Div. 2001). The SSA decision awarding defendant disability benefits indicated that defendant became permanently disabled as of September 30, 1998, and was entitled to monthly disability benefits effective March 1999. On August 23, 2003, the SSA determined that defendant's permanent disability continued. Therefore, defendant is entitled to a plenary hearing as to the nature and extent of her disability and whether modification of alimony, as a result of that disability, is warranted.
We note that this record is replete with factual disputes. For example, plaintiff questions defendant's inability to work, noting that her 2004 tax return showed gross receipts of $2144 as a consultant. Plaintiff also contends that the amount of defendant's monthly SSDI benefit is approximately equal to the amount the judge imputed to her in 1990 as earnings from part-time employment. In addition, the parties dispute the proper calculation of any cost of living adjustment to which defendant may be entitled. Defendant argues that plaintiff's support has not received a cost of living adjustment since 2002. Plaintiff contends that several expenses in defendant's CIS are inflated, and further argues that she has sufficient assets to enable her to live at the marital lifestyle standard. There is also some dispute in the record as to the proper determination of plaintiff's income. These unresolved contentions underscore the need for a plenary hearing. Lepis, supra, 83 N.J. at 159.
Finally, as noted earlier, we remand the issues of life insurance coverage and counsel fees for review and reconsideration at the plenary hearing.
Reversed and remanded.
© 1992-2008 VersusLaw Inc.