On appeal from the Superior Court of New Jersey, Chancery Division, Monmouth County, Docket No. C237-07.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted: January 14, 2009
Before Judges Axelrad and Messano.
Plaintiff, Estate of Bernard Ritterman (Estate), appeals from summary judgment dismissal of its complaint against decedent's wife seeking a constructive trust on the proceeds of the sale of the marital home she received following his death during the pendency of a divorce action. We affirm.
The parties were married in l978. It was the second marriage for both and while each had children from their prior marriages, they did not have any children together from this marriage. Shortly after the parties' marriage, husband retired and the parties lived on their assets, with their only income being social security. In l982 they purchased their marital home in Ocean Township as tenants by the entirety for the sum of $100,000, with no mortgage.
The parties each had health issues and wife claimed hers was exacerbated by the interference of husband's daughter from his first marriage. Accordingly, at the age of seventy-eight, wife left the marital home and went to her son's house, filing for divorce on January 30, 2007. Husband was eighty-nine years old at the time. Through counsel, the parties attempted to negotiate the equitable distribution of assets, the largest being the marital home.
It is undisputed that husband wanted to remain in the home and buy out wife's ownership interest after obtaining a reverse mortgage. Counsel attempted to reach an agreement on these and other issues and circulated several draft pendente lite consent orders; however, no agreement was signed. Regardless, in order to expedite husband's application for a reverse mortgage, on March 28, 2007, wife's counsel forwarded to husband's counsel a deed executed by wife signing over her share of the marital home for $226,937, consistent with the terms of the enclosed draft order, to be held in escrow until closing of the mortgage and payment of wife's interest.*fn1
Husband's counsel did not execute any consent order because, as she certified on January 28, 2008, "there were a few loose ends unrelated to the house," primarily involving confirmation of some accounts.*fn2 By their last meeting prior to June l4, 2007, "the resolution of the entire case was about 90% complete." Husband's counsel explained:
A few additional discovery requests were to be taken care of. The prior agreement concerning the house was confirmed except that the issue was raised on behalf of Mr. Ritterman that the mortgage appraisal had come in lower than the originally agreed upon market value and we were advised that Mrs. Ritterman and her attorney would consider taking a lower amount for the buyout since they acknowledged that the market had gone down. At all relevant points[,] however, the agreement was firm that Mr. Ritterman would buyout Mrs. Ritterman's share of the marital home for $226,937 or possibly less and that Mrs. Ritterman had executed the Deed already and the reverse mortgage proceeds would be used to pay this amount subject to any offsets owed Mr. Ritterman for the various accounts.
By early June, however, wife had received no notice of husband's obtaining a mortgage commitment, no closing date was set, the period for obtaining the mortgage was about to expire, and no pendente lite consent order or property settlement agreement had been signed. Counsel appeared at a case management conference on June 4, 2007, and an order for discovery was issued. A Matrimonial Early Settlement Panel (MESP) was scheduled for July 16, 2007. Husband died of a heart attack on June l4, 2007, and the MESP was adjourned to September. At that time, husband's counsel informed the court she would not be participating because of her client's death.
On August l0, 2007, wife, as owner of the marital home by operation of law, entered into a contract to sell the property to the next door neighbor for $415,000. The Estate recorded a lis pendens on September 6, 2007, however, it was not picked up by the title company until after closing on September 26, 2007.*fn3
On or about August l3, 2007, the Estate filed a complaint against wife in Chancery Division, Probate Part, to equitably divide the marital assets, essentially seeking imposition of a constructive trust on the proceeds from the sale of the marital property to effectuate the monetary equivalent of specific performance of the deed held in escrow by husband's counsel.*fn4
Wife filed a motion for summary judgment for dismissal of the lis pendens and the Estate's complaint for failure to state a cause of action. Wife argued that upon husband's death prior to the adjudication of divorce, all issues of equitable distribution abated and she became the sole owner of the marital residence they owned as tenants by the entirety with right of survivorship by operation of law. As a result, she retained her right to convey the property to the third party. Wife emphasized that there was no comprehensive agreement or divorce decree, and the deed was inoperative until closing of title of the reverse mortgage and payment of $226,937 to her, which did not occur prior to husband's death, or for that matter, at any time thereafter. She further contended there was no evidence of unjust enrichment or fraud warranting the imposition of a constructive trust as she and decedent had purchased the property in l982 and shared it for twenty-five of their ...