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Simon v. Simon


November 21, 2008


On appeal from Superior Court of New Jersey, Chancery Division, Family Part, Sussex County, FM-19-253-97.

Per curiam.


Argued October 9, 2007

Before Judges Collester and C.L. Miniman.

Defendant Iris Simon, former wife of plaintiff, Marc L. Simon, appeals from the April 13, 2006 order of the Family Part denying her motion to set aside the terms of a settlement and from a counsel fee award to plaintiff in the amount of $1,582.50. We affirm in part and reverse in part.

The case has a long history as witnessed by the voluminous record. At the outset of the relationship plaintiff was completing his surgical residency and about to start his practice as a general surgeon. Defendant was a surgical scrub nurse at Morristown Memorial Hospital. They began living together in the summer of 1983 and were married in November 1984. Two children were born of the marriage: Baylee, born on September 29, 1985, and Lindsay, born on May 18, 1988.

The parties separated in March 1991. A year later they signed a property settlement agreement (PSA), which was negotiated with the assistance of independent counsel. It provided for joint legal custody with defendant as residential custodian. Plaintiff agreed to pay child support of $1,000 per month until October 1, 1993, when his obligation increased to $2,000 a month allocated at $1,250 for Lindsay and $750 for Baylee. He also agreed to pay unreimbursed medical and dental expenses as well as an annual clothing allowance of $750 for each daughter. The PSA further provided plaintiff would pay rehabilitative alimony of $700 per month in addition to all necessary costs for defendant to obtain an R.N. degree at Morris County College. He also paid for defendant's new Volvo.

Defendant agreed to convey to plaintiff her interest in the former marital home in Sparta. A home was to be purchased for her in Millburn with plaintiff responsible for the down payment, mortgage and taxes until the termination of rehabilitative alimony. Plaintiff was then to pay $500 per month or thirty-five percent of defendant's net income, whichever was greater, toward the mortgage and taxes until defendant remarried or the house was sold. The parties took title as tenants in common with plaintiff as owner of thirty percent.*fn1 Other provisions of equitable distribution included the following:

In consideration of all the terms and conditions of the within property settlement agreement, the wife waives any claim she has or may have to equitable distribution of the husband's medical practice, the husband's interest in his MRI, the husband's 401k, IRA, etc., free from any claim of the wife whatsoever.

Each party waives any other claim he or she may have to any other assets acquired by the other during the course of the marriage and subject to equitable distribution pursuant to the laws of New Jersey.

The provision as to cost of education for the daughters read as follows:

The parties further acknowledge that it is their desire that the children obtain post-high school education, including but not limited to college, graduate school, etc. to the full extent that the children are capable. The husband agrees that he shall be solely responsible for all post-high school education expenses to be incurred on behalf of the children including but not limited to room and board, tuition, lab fees, reasonable costs of transportation, etc.

The PSA was amended three times. On March 23, 1992, it was agreed that defendant would pay an additional $13,500 toward the down payment of the Millburn house. An addendum in 1994 made plaintiff responsible for the first two years' payment of a new Saab leased by defendant, payment of defendant's automobile insurance, payment of $1,000 per year for the children's vacations, the cost of Hebrew school and a three percent annual increase in child support beginning in January 1995.

Additionally, the amendment stated that,

In the event of the wife's remarriage or cohabitation as defined by Gayet, or sale of the Millburn property, the child support shall be a total combined amount of $3,000 per month, allocated $1,875 for Lindsay and $1,125 for Baylee. The aforesaid child support of $3,000 per month will be subject to the three percent annual increase herein before referred to. Notwithstanding anything contained herein to the contrary, any obligation the husband has to contribute to the taxes and/or mortgage payment on the Millburn property shall terminate at the time the youngest child attains eighteen years or is graduated from college, which ever is later.

The third addendum was executed on September 24, 1997, the date of the divorce judgment. It increased child support to $3,500 per month allocated one half for each child and also stated:

Notwithstanding deviation from the guidelines pursuant to this Addendum, same shall not bar either party from seeking application of the "new guidelines" in connection with the subsequent modification of child support. It is further acknowledged by the parties that at the time child support was negotiated and modified as provided for herein, the parties' respective incomes at the time were and are reflected in the parties' joint federal and state income tax returns for the year 1996....

It is specifically agreed that in addition to modification of child support as provided for by statute, court rules, case law and as otherwise provided for herein, child support for both children shall be reviewed at the time a child commences college, taking into account husband's contribution for college, as provided for in the property settlement agreement.

On August 29, 2003, almost six years after the divorce, plaintiff filed his first motion to modify child support, unreimbursed medical, and his college contribution payments. He certified that he was remarried with another child and that his income was reduced from over $300,000 to about $216,000 while defendant's income subsequently increased from $22,000 to $120,000. He added that Baylee was about to enter college which would cost him about $35,000 per year. Alleging changed circumstances, he sought modification of the PSA to reduce his child support obligation and require defendant to pay forty percent of the cost of the daughters' college educations.

Defendant filed a cross-motion for child support arrearages accumulated as a result of the PSA addendum for an annual increase of one and one-half percent.*fn2

The motion judge ordered a plenary hearing on child support but denied a revision of the PSA as to unreimbursed medical expenses and cost of college educations. He added:

The parties entered into an agreement. There is no reason that has been given that I can find, no true change of circumstances that would warrant changing that.

Plaintiff's motion for reconsideration was denied. During oral argument counsel for defendant stressed that the issue at the plenary hearing would be plaintiff's application to reduce child support and not modification of plaintiff's college contribution. Counsel for plaintiff agreed.*fn3

Between June 2004 and February 2005, four discovery motions were filed by defendant. During oral argument on November 12, 2004, counsel for defendant stated:

Dr. Simon continues to mislead the court by stating what is his issue at the plenary hearing. He continues to say that its a reduction of child support and his college contribution. That second issue has been adjudicated by this court and its been denied. So that is not a pending issue.

Dr. Simon has one pending issue at the plenary hearing. And that is whether he is entitled to a child support reduction, if any amount is warranted.

Counsel for plaintiff responded,

And as far as the college expense issue, judge, that was part of his application. That's the reason it was mentioned to the court.

However, the issue of his college contribution was repeatedly raised by plaintiff. In the motion hearing of December 17, 2004 defendant, then pro se, had the following colloquy with the motion judge:

MRS. SIMON: Another very disturbing, and there's only one more thing, is Your Honor justly ruled that I had no obligation to college expense. It was part of the divorce agreement, the settlement between Dr. Simon and I. It is mentioned continually, in almost every motion, in every motion. In this motion, Your Honor, it is mentioned five times. Your Honor, it is always coupled with a request for a reduction in child support and a reduction in child expense obligation. It is in the notice of motion. It is in Mr. Baldwin's memorandum of law. It is in the certification. It is the order that he left blank... for Your Honor to sign.

THE COURT: It's actually kind of interesting. Because if a party, you know, says that he has an agreement that he is supposed to be making college contribution, and then he comes back and says he has changed circumstances, that at least on its face-and let me finish before you jump in, the argument can be made that I'm supposed to look at this case called Newburgh v. Arrigo, and determine what the parties' contribution to college should be and that I might have to modify it based on it. But, big but, if I do that, then I have to reform the whole agreement, because if there was give and take in the agreement that he was going to pay for college in exchange for you giving up equitable distribution, I have to look at that.

MRS. SIMON: Anyway, Your Honor, that was the case. I gave up everything for those things.

Following that hearing the judge reduced plaintiff's child support obligation from $3,500 to $3,375 per month but added:

Any further reduction, if any, must await hearing... plaintiff suggests $1,000 per month based on guidelines for one child (plus a slight additional amount) when this is clearly not, nor has it ever been a guideline case. The parties agreed on a level of child support that was subsequently in excess of guidelines. That agreement was partially in consideration of rehabilitative alimony as compared to some other form of equitable distribution whereby plaintiff received the marital residence and defendant's waiver of any interest to plaintiff's medical practice, interest in his MRI, 401k, IRA, etc. Plaintiff therefore has the burden to prove a modification is warranted, and that must await hearing....

Additionally, if the court does modify child support... then the PSA needs to be reformed as to alimony and equitable distribution.

The plenary hearing commenced on May 9, 2005. In the opening statement by plaintiff's counsel the issue of child support was once again linked with plaintiff's obligation to pay all college expenses. Plaintiff testified that he agreed to pay 100 percent of college when he signed the PSA because he was then earning about $300,000 a year while defendant was earning only $21,000. He said that his income had decreased to about $273,000 while defendant's increased to $186,000. He attributed his income reduction to both the increased cost of malpractice insurance and the imposition of managed care by insurance companies. He further claimed a reduction in his net worth with approximately $150,000 in tax liens and substantial loans to pay for Baylee's first and second years of college at Northwestern University. He was cross-examined at length by defendant in an attempt to show that he had hidden income and had minimized the value of his assets.

On the following day, May 10, 2005, the trial judge asked if the parties would agree to settlement discussions with the assistance of the court. Both parties agreed. Since defendant was pro se, the settlement conference was conducted on the record, and the record was sealed. Plaintiff's initial proposal was to equally divide the cost of education in addition to a significant reduction in child support. Defendant's first proposal was that plaintiff pay 100 percent of the children's education as provided in the PSA, but she was willing to accept some reduction in child support. With both parties present, the judge summarized their respective positions as follows:

Her position is as follows, Ms. Simon's position: We had an agreement. The agreement says that he is to pay for all college, plus he is supposed to pay $3,500 a month for the child support for the children. At the point that a child begins college, the child support is supposed is to be recalculated. And when its recalculated, its obviously, since the other child is still at home, Lindsay is still at home, so I'm still going to get child support of $1,750, and with respect to benefits Baylee, he's going to pay all of her college, plus pay me child support somewhere between zero and $1,750.... Your argument, from his point of view, his argument is: If we were doing this all today and we were looking at your respective incomes, we would just put them both on the board, see what the expenses were of college and raising the children, in a proportion to your net income, that's how much you would be paying and contributing in very broad strokes, that's what would be happening. So, your obligation would probably be to pay a substantial chunk of the college education, but for the agreement.

During the course of the settlement negotiations the judge asked questions of both parties as to their expenses and the expenses for the two daughters. Later in discussing the matter with defendant outside the presence of plaintiff and his attorney, the court explained the process:

I'm trying to do settlement and so I'm going to talk to you and I'm going to talk to them. Then I'll ask you to leave the room. But you need to know as part of what you're thinking about, as part of your thinking process, you need to know what I'm going to do if I try the case to conclusion. If I try the case to conclusion, forgetting the credibility issues because you've already pointed out very well, by the way, where they've got credibility gaps. And they do. He has major credibility gaps in terms of his income.

But the one thing you're not going to be able to overcome and surmount is the fact that your income went from zero to sixty in ten seconds, or whatever you want to call it... And that's a consideration.

That's a change of circumstances that I need to consider. And as part of the change of circumstances if I step back and do this objectively, I'm going to say you're going to wind up making some of the college contributions. So if you're going to make some of the college contributions, and I'm saying to you that I think that that would be the ultimate outcome, you need to see if you can offer to pay something that is less than I would order if I actually tried the case. If I try the case, you're probably going to get stuck with a contribution close to your percentage, which is 43%. So 43% of $40,000 per year is $17,000.

You need to be thinking for the purposes of settlement-when you are trying the case you need to be aggressive and litigate it to the fullest. But in terms of settlement, you need to be able to figure out, forgetting that you're Iris Simon, the litigant, I'm Iris Simon the attorney, and I'm advising my client how this case is going to come out if the judge decides it and what I can do to minimize my client's losses.

So instead of-you're emotional about it, and I understand you're emotional, but you've got to be able to divorce yourself... from what you're doing here and step back and look at yourself as a litigant, as if you're representing her and tell her what is the best advice you can give her. And I'm telling you where you're standing right now is not the best advice you should be giving yourself.

The judge then spoke to plaintiff and his attorney and was able to secure another offer, which he described to defendant as follows:

They're proposing that you pay toward the college of the children room and board but not less than $12,000 a year, which is what you told me her room and board was.... With respect to support it would go down to $2,250 effective January 1 of this year. So you would have four months that you have to make up. It would go to $1,250 on September 1 of 2006 when Lindsay in theory starts college. It would go to $500 when Baylee graduates from college and of course it would go down to zero when Lindsay graduates from college. I think that's a pretty fair proposal and I think its in your favor to accept it, but you've got to think about it....

I think this is a good deal, Mrs. Simon. I don't think this is a bad thing for you. And it does a lot for you. One thing for sure, it takes away all the uncertainty of the trial....

You've done a yeoman's job in this case, Mrs. Simon. Now its time, as I said before, to separate out the two people that you are, one the litigant and one the attorney and try to figure out whether the attorney is giving the correct advice to the litigant.

MRS. SIMON: Well, to be honest with you, I think that an attorney would tell me, that knew the whole history of this, which you don't, Iris, you go all the way because he'll get nothing. You really wouldn't give him anything if I showed you everything. And I can. Okay? I think truly that's what an attorney would say to me.

THE COURT: Well, your attorney, because of what I said to you before, would be giving you, I think bad advice, because... the one thing that I told you before that is critical in this thing is that there are really two major things the court can look at in terms of change of circumstances. One is whether he had changes in his income position. The other is changes in your income position. And you do have a change. You can't argue that period.

After discussing the matter further, defendant agreed to pay the cost of room and board for college up to the amount of $15,000 and split summer costs and other minor matters.

Defendant then left the courtroom, and plaintiff and his attorney re-entered. After hearing the counteroffer, plaintiff said he would agree provided that he receive $2,500 as a credit. With both parties present, the judge set forth the terms of the agreement as follows:

[E]ffective 1/1/05, plaintiff's child support is reduced from $3,375 to $2,250 per month. Effective 9/1/06 plaintiff's child support is further reduced to $1,250 per month. Effective with the month following Baylee's graduation from college (Bachelor's degree) child support is further reduced to $500 per month.... Effective with Lindsay's graduation from college with a bachelor's degree, plaintiff's child support will terminate.

Plaintiff shall pay all college costs for the parties' children, except as provided hereinafter. Defendant will pay all fees for college entrance exams, college application fees and text books as she has previously done. In addition, defendant shall pay the fees charged by Baylee's sorority, including without limitation, fees for room and board, but in no event less than $1,200 per year toward Baylee's costs at Northwestern University.

Similarly, when Lindsay starts college, defendant shall contribute by paying the full amount of her room and board, but not less than $12,000 per year. If the cost of room and board for either child at school does not rise to $12,000 for any school year, the defendant shall contribute the difference, that is, $12,000 minus the school's room and board for the child, toward the other college costs of said child.

Notwithstanding the above, defendant's obligations for room and board for each child per school year is capped at $15,000.... In consideration of defendant's claim for contribution from plaintiff for Baylee's and Lindsay's 2005 scheduled summer activities, plaintiff is waiving one half or $2,250 of the $4,500 reimbursement due plaintiff for the reduced child support effective 1/1/05.

The agreement was set forth in a form of order, and each party testified to its acceptance. Defendant then took the witness stand and confirmed her acceptance of the agreement.

THE COURT: Ms. Simon, you have the document in front of you. You signed it, correct?

A: Yes.

Q: You've had the terms read to you by the court, correct?

A: Yes.

Q: And you've read the consent order itself, is that right?

A: Yes....

Q: [The consent order] just reflects the changes that were done to child support and college contribution, you understand that?

A: Yes.

Q: Under all the circumstances do you believe that the provisions are fair?

A: Yes, I do.

Q: Do you feel you've had enough time to reflect on [the settlement]?

A: Yes, I do.

Q: And you're satisfied with it, is that correct?

A: Yes I am.

The order of settlement was then signed by the motion judge. Almost six months later on November 2, 2005, defendant filed a notice of motion seeking relief under Rule 4:50-1 to vacate the provision of the settlement for her to pay a portion of college tuition and for an evidentiary hearing. Her grounds for relief included a claim that the hearing judge was misled by plaintiff's counsel to consider the college expense obligation at the plenary hearing and the judge mistakenly advised her to pay a portion of college educations based upon the incorrect assumption that the obligation related to child support as opposed to equitable distribution. She further argued that no compelling change of circumstances was advanced by plaintiff to justify modification of the PSA and that he committed fraud and perjury by misstating his income, assets, and liabilities.

Defendant certified that a few days after the settlement date she spoke to a former attorney who told her that while a change of circumstances could warrant modification of support or alimony, it should not warrant a change in equitable distribution contained in a PSA. She further certified that the federal tax lien against plaintiff had been paid off shortly after the settlement and that other information obtained from her forensic accountant indicated that defendant's testimony at the plenary hearing was willfully false. Plaintiff filed papers in opposition and sought a counsel fee award. Following argument on April 13, 2006, the motion judge denied defendant's motion in its entirety and granted plaintiff's application for a counsel fee in the sum of $1,582.50. This appeal followed.

Defendant presents the following arguments for our consideration:




Much of defendant's arguments rest on her contention that because of prior denials of plaintiff's motions to modify his PSA obligation for payment of all college expenses, the issue was not properly raised at the plenary hearing, which was to deal only with child support. However, the estimated cost of college for the two daughters obviously related to plaintiff's application to reduce support, and defendant was fully aware that plaintiff would not settle on the amount of child support unless he was relieved of the entire burden of college education.

Furthermore, defendant is incorrect in her assumption that the cost of college education equated to equitable distribution and was thereby unalterable. The concept of equitable distribution relates to assets acquired during the marriage. See Painter v. Painter, 65 N.J. 196 (1974); Chalmers v. Chalmers, 65 N.J. 186 (1974); N.J.S.A. 2A:34-23.1. Contribution by one or both of the parties to a college education is an aspect of child support which may be modified upon a showing of a significant and unanticipated change of circumstances. See Lepis v. Lepis, 83 N.J. 139 (1980); Newburgh v. Arrigo, 88 N.J. 529 (1982).

Defendant now asserts that during negotiations leading to the 1992 PSA, she agreed to take less equitable distribution and support in exchange for defendant assuming the entire cost of college educations. However, nothing in the agreement so indicates, and there is no so-called "anti-Lepis" provision preventing modification based on changed circumstances. See Morris v. Morris, 263 N.J. Super. 237, 241-43 (App. Div. 1993); Smith v. Smith, 261 N.J. Super. 198, 199-200 (Ch. Div. 1992). Furthermore, based on the record before us, we cannot find that the equitable distribution and rehabilitative alimony received by defendant did not constitute fair consideration to defendant leaving aside plaintiff's assumption of all college expenses. Defendant's argument that she is entitled to relief from the court's order of May 10, 2005, based upon newly discovered evidence of alleged fraudulent misrepresentations by plaintiff is without merit. Plaintiff's financial position was hotly disputed by defendant prior to the settlement, and she was aware prior to settlement that plaintiff may have hidden income or assets from her because she did not secure adequate discovery.

The following colloquy between defendant and the hearing judge is illustrative of the point.

DEFENDANT: But should I consider that there's partnerships and things that have not been disclosed? I mean-

THE COURT: Well, are you going to be able to prove all that?



DEFENDANT: But we-but-

THE COURT: How much do you think-let me ask you that way: How much do you think that his income really is?

DEFENDANT: $100,000 more a year.

Despite these suspicions that her former husband was not truthfully disclosing his finances, defendant knowingly and voluntarily agreed to the settlement.

Settlement of litigation is in accord with the public policy of this State and settlement should be encouraged especially in Family Court actions. Puder v. Buechel, 183 N.J. 428, 438 (2005); Ziegelheim v. Apollo, 128 N.J. 250, 263 (1992); Nolan v. Lee Ho, 120 N.J. 465, 472 (1990); Peskin v. Peskin, 271 N.J. Super. 261, 274-75 (App. Div. 1994); Davidson v. Davidson, 194 N.J. Super. 547, 550 (Ch. Div. 1984). A settlement agreement is a contract and is to be enforced despite a change of heart or mind. Nolan, supra, 120 N.J. at 472; Pascarella v. Bruck, 190 N.J. Super. 118 (App. Div. 1983). A settlement will be set aside only if it is clearly the result of coercion, fraud, deception, or undue pressure. See Nolan, supra, 120 N.J. at 472; Peskin, supra, 271 N.J. Super. at 276. Defendant has not shown sufficient proof for any such finding.

After review of the record, we find that defendant was not improperly coerced or unduly pressured by the trial judge. She was told numerous times that she did not have to enter into a settlement and that the case would otherwise go forward and give her the opportunity to present her proofs. Nor was she misled by the judge's comments that a decision could well impose upon her the obligation to pay part of the college educations for her daughters.

The central fact remains that defendant accepted the settlement and acknowledged under oath that she did so without coercion and with understanding of its terms. Accordingly, the motion judge properly denied her Rule 4:50 motion to vacate the settlement.

Defendant has also appealed the order of April 13, 2006, awarding plaintiff $1582.50 for counsel fees in connection with his opposition to defendant's motion. The judge placed his decision on the record on March 31, 2006, and made the following factual findings:

Simply stated, there is nothing here which warrants a review of this matter or a grant of relief to the Defendant based upon my exhaustive review of the record and pleadings filed in this matter. It's both an exhaustive review, as well as an exhausting review. I am not satisfied that there is any merit whatsoever to the application brought by the Defendant. Viewing this even in a light most favorable to the Defendant pro se, I have to conclude that the application is devoid of any merit, either factually or legally, that it's frivolous. And accordingly, I award counsel fees to the Plaintiff in connection with what I find to be a settlement agreement which was freely and voluntarily entered into by both parties.

The review sought by Ms. Simon has engendered considerable time and legal expense and under the circumstances, a reasonable counsel fee should be awarded. Mr. Baldwin, you can supplement your prior filings with a certification of services and I'll consider that information. And that should be provided in a separate order under the Five Day Rule, and provide copies to Ms. Simon in that regard.

These fact-findings do not meet the requirements of Rule 1:7-4(a), which provides that a judge has a duty to make findings of fact and conclusions of law "on every motion decided by a written order that is appealable as of right." R. 1:7-4(a). "Failure to perform that duty constitutes a disservice to the litigants, the attorneys, and the appellate court." Curtis v. Finneran, 83 N.J. 563, 569-70 (1980) (quotations omitted). Moreover, "[n]aked conclusions do not satisfy the purpose of R. 1:7-4." Id. at 570. Here, the judge's fact-findings are no more than naked conclusions.

The judge's fact-findings also do not comply with N.J.S.A. 2A:34-23, which mandates that the court "shall consider the factors set forth in the court rule on counsel fees, the financial circumstances of the parties, and the good or bad faith of either party." It is only where the first two factors have been established that the court may consider the good or bad faith of either party. Chestone v. Chestone, 322 N.J. Super. 250, 256 (App. Div. 1999). Here, the judge made no findings at all with respect to the financial circumstances of the parties and did not discuss the factors set forth in the applicable court rule.

Rule 5:3-5(c) governs the award of counsel fees in a family-part matter and provides in pertinent part:

In determining the amount of the fee award, the court should consider, in addition to the information required to be submitted pursuant to R. 4:42-9, the following factors: (1) the financial circumstances of the parties; (2) the ability of the parties to pay their own fees or to contribute to the fees of the other party; (3) the reasonableness and good faith of the positions advanced by the parties; (4) the extent of the fees incurred by both parties; (5) any fees previously awarded; (6) the amount of fees previously paid to counsel by each party; (7) the results obtained; (8) the degree to which fees were incurred to enforce existing orders or to compel discovery; and (9) any other factor bearing on the fairness of an award.

Here, the judge considered only the third and seventh factors listed in this rule, yet N.J.S.A. 2A:34-23 and Rule 5:3-5(c) clearly require much more. Because the failure to apply the factors required by the statute and rule presents a question of law, the judge's conclusions are not subject to review for an abuse of discretion. Manalapan Realty, L.P. v. Township Comm. of Manalapan, 140 N.J. 366, 378, (1995) ("A trial court's interpretation of the law and the legal consequences that flow from established facts are not entitled to any special deference.").

We are satisfied that the judge erred in limiting his consideration of the application to only two of the nine factors, especially because we have held that a counsel-fee award may not be used to sanction a litigant who files a meritless motion in the Family Part. Chestone, supra, 322 N.J. Super. at 259; Ridley v. Dennison, 298 N.J. Super. 373, 381-82 (App. Div. 1997).

Although the judge found that the defendant's application was devoid of merit, and we here affirm the outcome he reached on that application, we reverse the $1582.50 award for counsel fees and remand the matter only for entry of an order vacating that award. We are satisfied that the financial circumstances of the parties prohibit an award of fees in favor of plaintiff. Chestone, supra, 322 N.J. Super. at 259.

Affirmed in part and reversed and remanded in part for entry of an order consistent with this opinion.

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