December 30, 2008
LISA THEILLER, PLAINTIFF-RESPONDENT,
JAMES T. THEILLER, DEFENDANT-APPELLANT.
On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Sussex County, FM-19-143-05.
The opinion of the court was delivered by: Per Curium
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued January 16, 2008
Before Judges Wefing, Parker, and R. B. Coleman.
Defendant James T. Theiller appeals from a final judgment of divorce dated September 22, 2006, from plaintiff Lisa Theiller, now known as Lisa Killion. Plaintiff filed a complaint for divorce based on extreme cruelty on September 27, 2004. After a stream of motions to enforce litigants' rights the case culminated in a highly acrimonious and protracted trial over seven days between January 30 and April 18, 2006.
The final judgment of divorce, executed on September 22, 2006, provided: (1) the parties would share joint legal custody of the four children, with plaintiff having physical custody of the three youngest and defendant having physical custody of the oldest child; (2) defendant was to pay child support in the amount of $314 per week until July 1, 2006, based on defendant's income of $58,079 and plaintiff's imputed income of $35,000, and after July 1, 2006, the oldest child would be deemed emancipated and defendant was to pay child support in the amount of $282 per week for the three youngest children; (3) plaintiff was to retain the petting zoo business, including the animals and paraphernalia, which was valued at $25,000; (4) the marital residence was to be listed for sale with the proceeds split equally; (5) until the residence could be sold, the parties were to share equal responsibility for taxes and homeowner's insurance and plaintiff was to be responsible for household expenses; (6) defendant was to pay plaintiff limited-duration non-taxable alimony in the amount of $150 per week for five years from May 15, 2006; (7) defendant was to pay plaintiff $6,800 from his retirement plan; (8) defendant was to pay $3,500 in counsel fees as ordered November 14, 2004, and $10,000 in counsel fees from the net proceeds of the sale of the marital property; and (9) each party was permitted to claim two children as dependants for tax purposes. Defendant was also ordered to continue medical insurance coverage for the children.
By separate order dated September 22, 2006, and filed October 4, 2006, defendant's motion for reconsideration of the alimony and child support awards and to clarify equitable distribution was denied, as was plaintiff's cross-motion for additional support denied for insufficient proof. Defendant filed a notice of appeal on November 22, 2006. We affirm the award of alimony and counsel fees, but we remand for a more definitive statement of the basis for the child support calculation.
Defendant and plaintiff were married on April 12, 1997. They have four children ranging from eight to seventeen years of age. At the time of trial, defendant was employed by D&N Auto Body and earned between $55,000 to $63,000 a year. Plaintiff worked part-time as a school bus driver, earning about $15,000 a year. She also bred animals and ran a petting zoo business on the marital property which generated upwards of $20,000 per year.
Defendant raises the following issues on appeal:
I. THE COURT ERRED IN ITS RULING BASED ON PLAINTIFF'S CREDIBILITY AND/OR FAILURE TO DISCLOSE ASSETS. (defendant's point I. and II.)
II. THE COURT ERRED IN ITS EQUITABLE DISTRIBUTION AWARD. (defendant's point III.)
III. THE COURT ERRED IN ITS CALCULATION OF CHILD SUPPORT AND ALIMONY. (defendant's point IV.)
IV. THE COURT ERRED IN AWARDING COUNSEL FEES TO PLAINTIFF. (defendant's point V.)
We discuss each in turn.
Defendant contends that he was denied a fair trial due to plaintiff's refusal to honestly and fairly disclose marital assets, and that plaintiff's lack of truthfulness to both the trial court and defense counsel led to an inequitable result. We find defendant's argument unpersuasive on this point.
Generally, we defer to the trial judge's credibility determinations because of his or her ability to see and observe witnesses and evaluate their veracity. Pascale v. Pascale, 113 N.J. 20, 33 (1988). Absent a decision that is wholly unsupported by competent, relevant, and reasonably credible evidence in the record, we will affirm a trial court's findings on credibility. Rova Farms Resort, Inc. v. Investors Ins. Co., 65 N.J. 474, 483-84 (1974). Here, we find no abuse of discretion in the trial judge's determination that the credibility of both parties to this matrimonial action was questionable. Hence, we reject the claim by defendant that the court committed reversible error by unduly crediting plaintiff's proofs.
As to plaintiff's failure to disclose assets. there is no evidence in the record that defendant deposed plaintiff, nor did he seek relief from the court regarding plaintiff's alleged obstruction of discovery. Under such circumstances, defendant's overall ill-preparedness for trial was in substantial part due to his own omissions.
Plaintiff's tax returns and appointment books were introduced at trial and defendant had the opportunity to cross-examine plaintiff extensively on that evidence. Also, while plaintiff's disclosures regarding the petting zoo business may not have been readily forthcoming, the court's decision to impute income to plaintiff from the business shows that defendant was somewhat successful in his attempt to demonstrate that the business was profitable. The court imputed income from the business in the amount of $20,000 and rejected plaintiff's claim that profits were negligible. More telling was the trial judge's direct assessment of both parties. The court questioned the credibility and conduct of both parties, but it did not exhibit favoritism or bias in favor of either party.
Defendant next contends the trial court failed to assign proper values to certain assets in the equitable distribution award, and that plaintiff received the "lion's share" of the distribution. From the petting zoo, defendant received only a tractor and one horse and he claims he should have been given more of the farm assets or, alternatively, an offset.
In determining an equitable distribution of marital assets, the court must engage in a three-step process. First, it must decide what property of each party is eligible for distribution. Rothman v. Rothman, 65 N.J. 219, 232 (1974). Next, it must determine the value of each piece of property. Ibid. Last, the court must decide how an allocation between the two spouses can most equitably be made. Ibid. This three-step process has been incorporated by the Legislature in N.J.S.A. 2A:34-23.1, which requires that "in every case, the court shall make specific findings of fact on the evidence relative to all issues pertaining to asset eligibility or ineligibility, asset valuation, and equitable distribution . . . ." To that end, the trial judge "must receive, and must insist upon having, the full cooperation of the litigants." Rothman, supra, 65 N.J. at 233. Moreover, in advance of trial, counsel for both parties must ensure that their clients "have carefully reviewed all eligible property interests they possess and that they come to court prepared to testify fully and accurately with respect thereto." Ibid.
A trial judge has broad discretion in determining how to divide marital assets that have been identified by the parties to the action. Wadlow v. Wadlow, 200 N.J. Super. 372, 377 (App. Div. 1985). There is no presumption that marital assets should be distributed equally. Rothman, supra, 65 N.J. at 232 n.6. However, it is presumed that each party contributed to the marital enterprise. Perkins v. Perkins, 159 N.J. Super. 243, 247 (App. Div. 1978). Even if the acquisition of property may be traced more directly to one party than the other, the distribution must reflect both the non-pecuniary and the pecuniary contributions to the marriage. Ibid. This reflects "the concept that marriage is a shared enterprise, a joint undertaking, that in many ways it is akin to a partnership." Rothman, supra, 65 N.J. at 229.
Statutory equitable distribution is based on the philosophy that marriage is a joint enterprise in which the interest in and entitlement to its underlying property is also joint and mutual. The entitlement to marital property is not dependent on economic contributions as such. Less tangible efforts are recognized as equally valuable to the overall prosperity of the familial entity. [Carr v. Carr, 120 N.J. 336, 347 (1990).]
An abuse of discretion will not be found simply because the lower court failed to distribute the property in accordance with its origin of acquisition. Pascale v. Pascale, 274 N.J. Super. 429, 435 (App. Div. 1994), aff'd in part, rev'd in part on other grounds, 140 N.J. 583 (1995). From the record it can be determined that plaintiff was the sole operator of the petting zoo business and that defendant was not involved in the daily operations. The court valued the business assets at $25,000 and connected such allocation of value with the limited-duration alimony awarded to plaintiff. Despite the conflicting testimony of the parties regarding the valuation of the petting zoo business, the court cannot be said to have abused its discretion in valuing the business or in awarding the petting zoo business as an ongoing operation to plaintiff alone. Moreover, after a careful review of the record, we are satisfied that the conclusions of the trial judge are adequately supported as to the total value of assets eligible for distribution, and we find no basis to disturb the allocation to each party.
Defendant next argues that the alimony and child support awards were "improperly calculated" and "inconsistent" with the guidelines.
In our consideration of the challenge to the award of alimony, we must keep in mind its purpose. The basic purpose of alimony is "to assist the supported spouse in achieving a lifestyle that is reasonably comparable to the one enjoyed while living with the supporting spouse during the marriage." Crews v. Crews, 164 N.J. 11, 16 (2000). "The supporting spouse's obligation is set at a level that will maintain that standard." Innes v. Innes, 117 N.J. 496, 503 (1990) (citing Lepis v. Lepis, 83 N.J. 139 (1980)). "Bare survival is not the proper standard, it is the quality of the economic life during the marriage that determines alimony." Hughes v. Hughes, 311 N.J. Super. 15, 31 (App. Div. 1998).
Hence, the award of spousal support is broadly discretionary. Steneken v. Steneken, 367 N.J. Super. 427, 434 (App. Div. 2004), aff'd in part, 183 N.J. 290 (2005). However, such discretion is not limitless. N.J.S.A. 2A:34-23(b) sets forth "guidelines and objective standards which frame the exercise of the court's discretion." Ibid. Thus, in determining whether alimony is appropriate and, if so, in setting the type, amount and duration of an award, the court must consider the following statutory criteria, insofar as they are relevant:
(1) The actual need and ability of the parties to pay;
(2) The duration of the marriage;
(3) The age, physical and emotional health of the parties;
(4) The standard of living established in the marriage and the likelihood that each party can maintain a reasonably comparable standard of living;
(5) The earning capacities, educational levels, vocational skills, and employability of the parties;
(6) The length of absence from the job market of the party seeking maintenance;
(7) The parental responsibilities for the children;
(8) The time and expense necessary to acquire sufficient education or training to enable the party seeking maintenance to find appropriate employment, the availability of the training and employment, and the opportunity for future acquisitions of capital assets and income;
(9) The history of the financial or non-financial contributions to the marriage by each party including contributions to the care and education of the children and interruption of personal careers or educational opportunities;
(10) The equitable distribution of property ordered and any payouts on equitable distribution, directly or indirectly, out of current income, to the extent this consideration is reasonable, just and fair;
(11) The income available to either party through investment of any assets held by that party;
(12) The tax treatment and consequences to both parties of any alimony award including the designation of all or a portion of the payment as a non-taxable payment; and
(13) Any other factors which the court may deem relevant.
An appellate court "'give[s] deference to a trial judge's findings as to issues of alimony, if those findings are supported by substantial credible evidence in the record as a whole.'" Cox v. Cox, 335 N.J. Super. 465, 473 (App. Div. 2000), (quoting Reid v. Reid, 310 N.J. Super. 12, 22 (App. Div.), certif. denied, 154 N.J. 608 (1998)). An alimony award will not be disturbed unless it is "manifestly unreasonable, arbitrary, or clearly contrary to reason or to the evidence, or the result of whim or caprice." Raynor v. Raynor, 319 N.J. Super. 591, 605 (App. Div. 1999).
Trial courts have a duty, however, to make specific findings of fact and to state reasons on the record that support their conclusions. R. 1:7-4; Heinl v. Heinl, supra, 287 N.J. Super. at 347. "Naked conclusions are insufficient . . . [a] judge must fully and specifically articulate findings of fact and conclusions of law." Ibid. Where the imputation of income is concerned, this "is a discretionary matter not capable of precise or exact determination but rather requiring a trial judge to realistically appraise capacity to earn and job availability." Storey v. Storey, 373 N.J. Super. 464, 474 (App. Div. 2004) (citing Tash v. Tash, 353 N.J. Super. 94, 99 (App. Div. 2002)).
Here, the trial judge was convinced that defendant had demonstrated, through credible evidence, that the petting zoo business generated income in at least the amount of $20,000 per year. That, in addition to the $15,000 per year income from plaintiff's employment as a bus driver was the basis of the trial court's determination that limited-duration, rehabilitative alimony in the amount of $150 a week was warranted. The trial judge considered the age, health and education of the parties. Also, the judge noted that prior to the marriage, plaintiff had been employed full-time in a secretarial position earning $18,000 per year. The trial judge found no reason that would limit plaintiff's capacity to increase her income by full-time employment, or alternatively, reduce her economic dependency on defendant by maintaining or growing the petting zoo business. These findings are consistent with the preference expressed in our opinions for rehabilitative alimony and the factors used by the trial judge to calculate the amount were appropriate. Heinl, supra, 287 N.J. Super. at 347. The alimony for a five-year term is affirmed.
As to child support, defendant claims that the court erred in its calculation based on plaintiff's imputed income of $35,000. Defendant asserts the "various proofs show Plaintiff's income to be higher." These "proofs," as we understand defendant's argument, included photographs of large amounts of cash allegedly belonging to plaintiff, plaintiff's "undisclosed" Sussex Bank account that had approximately $30,000 in deposits made in 2005, and evidence that some petting zoo receipts were never deposited. The trial court found that evidence was neither reliable nor persuasive. Defendant contends, however, that $35,000 is not an accurate attribution of income for plaintiff, and that the child support award was in error under the guidelines because the court failed to explain how it arrived at the figures. Further, defendant claims, there is no "good cause" to depart from the guidelines in this case.
We agree with defendant that the child support guidelines should control. Indeed, "a child support order following the Guidelines 'is assumed to be the correct amount of child support unless a party proves to the court that circumstances exist that make a guidelines-based award inappropriate in a specific case.'" Capaccio v. Capaccio, 321 N.J. Super. 46, 52-53 (App. Div. 1999) (quoting Appendix IX-A(2)). In Capaccio, we explained that good cause must be shown to justify a disregard or adjustment of the guidelines:
The court may disregard the Guidelines or adjust a Guidelines-based award: if a party shows, and the court finds, that such action is appropriate due to conflict with one of the factors set forth in sections 4, 7, 10, 13, 14, 15, or 20 of Appendix IX-A, or due to the fact that an injustice would result due to the application of the guidelines in a specific case. The determination of whether good cause exists to disregard or adjust a guidelines-based award in a particular case shall be decided by the court. [Ibid.]
Absent a showing of good cause for deviation, a judge establishing or modifying child support must apply the guidelines. Diehl v. Diehl, 389 N.J. Super. 443, 452 (App. Div. 2006). To do so, "[a]fter determining the income of each parent, the trial court must use the guidelines worksheet to calculate the exact amount of the child support order." Larrison v. Larrison, 392 N.J. Super. 1, 20 (App. Div. 2007).
Here, the trial judge found that defendant's yearly income was $58,079 and plaintiff's yearly income was $35,000. The court then ruled, without further explication, that defendant was to pay $314 per week for four children until July 1, 2006, and $282 per week for three children thereafter. The court did not attach worksheets showing the calculation under the guidelines and did not further explain how those figures were calculated. As such, it is unclear to us whether or not the child support guidelines were, in fact, followed. On the present record, therefore, there is insufficient evidence to permit a reliable review of the figures on appeal or to determine whether the court followed or deviated from the guidelines. The absence of a guidelines worksheet makes review of the trial court's findings in this regard an impossible task. The financial information, already stale in 2006 when the decision was made which prompted this appeal, is by now likely to be wholly unreliable. Accordingly, in the interest of fairness and expediency, we remand the issue of child support so that a new calculation of child support, using updated financial data, may be made as expeditiously as possible, but not more than forty-five days from the date of this opinion. Any adjustments in payments under the judgment of divorce shall be made by the trial court.
Finally, defendant contends that the trial court erred in awarding plaintiff $3,500 in pendente lite counsel fees and $10,000 in counsel fees to be paid from the proceeds upon the sale of the marital property.
"[T]he award of counsel and costs in a matrimonial matter rests in the discretion of the court." Williams v. Williams, 59 N.J. 229, 233 (1971); Heinl v. Heinl, supra, 287 N.J. Super. at 349-50; Fellerman v. Bradley, 191 N.J. Super. 73 (Ch. Div.), aff'd, 192 N.J. Super. 556 (App. Div. 1983), aff'd, 99 N.J. 493 (1985). Absent a clear abuse of discretion, a trial court's award of counsel fees should not be disturbed. Chestone v. Chestone, 285 N.J. Super. 453, 468 (App. Div. 1995).
Pursuant to N.J.S.A. 2A:34-23, the trial court may "order one party to pay a retainer on behalf of the other for expert and legal services when the respective financial circumstances of the parties make the award reasonable and just." In considering such an application, whether pendente lite or for a final award, the court is required to "review the financial capacity of each party to conduct the litigation and the criteria for award of counsel fees that are then pertinent as set forth by court rule . . . and the good or bad faith of either party." Ibid.
Rule 4:42-9 authorizes an award of legal fees and refers to Rule 5:3-5, which lists factors to be considered in awarding legal fees in a matrimonial matter. To the extent relevant here, in determining such an application, the court must consider the requesting party's need, the other party's ability to pay, the good and bad faith of each party, and the reasonableness of the positions advanced by them. R. 5:3-5(c). Bad faith includes (1) unwillingness or intransigence during litigation to negotiate equitable distribution of marital property, (2) pursuit of relief to which one knew or should have known that he or she was not reasonably entitled under the facts or the law, (3) intentional misrepresentation of facts or law to avoid or unfairly limit equitable distribution, and (4) vexatious or wanton acts or acts initiated to oppress one's opponent. Borzillo v. Borzillo, 259 N.J. Super. 286, 293-94 (Ch. Div. 1992).
The trial court ruled that defendant should pay the $3,500 counsel fee award previously ordered and an additional $10,000 in counsel fees from the net proceeds of the sale of the marital property. The court stated:
I'm satisfied that on balance, despite herself, the positions advanced by [plaintiff] are sufficient to warrant an award of counsel fees beyond that which was awarded pendente lite. More is sought, but I'm satisfied that the positions of [defendant] were sufficiently meritorious to reduce the amount of counsel fees that might ordinarily have been paid had those positions not been found to be meritorious.
We, likewise, are satisfied that the record supports the trial judge's award of counsel fees and the reasons given therein were sufficiently articulated. The court did not abuse its discretion.
In summary, all awards are affirmed except the award of child support which is remanded for an expedited hearing and recalculation, to be conducted within forty-five days from the date of this opinion, in accordance with the child support guidelines. We do not retain jurisdiction.
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