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Miller v. Miller


April 28, 2009


On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Ocean County, Docket No. FM-15-1251-06.

Per curiam.


Submitted March 25, 2009

Before Judges Parrillo, Lihotz and Messano.

In this matrimonial matter, defendant Robert Miller appeals from that portion of a final judgment of divorce (FJD) equitably distributing the parties' jointly held primary and vacation homes, claiming they are immune assets owned exclusively by him, or, alternatively, that the Family Part judge erred by overvaluing the interest of his wife, plaintiff Marie Miller, therein. Plaintiff cross-appeals from the dismissal of her Tevis*fn1 inter-spousal tort claim. We affirm.

The relevant facts are as follows. The parties were married on March 26, 1986 and after twenty years together, separated on March 13, 2006. Sixty-four-year-old defendant is a retired physician of osteopathic medicine who currently suffers from cognitive deficits. Plaintiff began working for defendant in his medical practice as office manager in 1976, and by 1983 -- three years before their marriage -- had moved in together in the same residence at 641 First Avenue, West Creek, that they continuously occupied up to the time of their separation. She is currently sixty-one years old and also suffers from health problems, namely renal failure, a blood disease of abnormal protein cells, and seizures.

The dispute over the division of assets concerns the West Creek marital home (Cedar Run), with a stipulated value of $495,000, and a Lake Tahoe vacation home investment property, with a stipulated value of $1,565,000. Both of these properties, together with the West Creek office property on Main Street, were originally owned by defendant's parents, who purchased them in the 1970's. In 1976, defendant took possession of the Cedar Run property and commenced paying his parents $850 per month toward the $35,000 plus interest defendant's parents agreed to accept before transferring legal title to their son. Before defendant made full payment however, on April 30, 1980, defendant's parents executed a deed of trust on the Cedar Run home, under which defendant was named trustee. The terms of this trust deed are unclear from the record,*fn2 but by all indications, it appears defendant was simultaneously named sole trustee and joint beneficiary. In any event, eleven years later, on December 20, 1991, defendant, acting as trustee on behalf of his parents, executed a deed transferring the Cedar Run property jointly to him and plaintiff. Before that transfer occurred, defendant's parents forgave various amounts of defendant's loan on the Cedar Run property once a year from 1987 to 1992. The second to last loan forgiveness note was written by defendant's parents on December 28, 1991, about a week after defendant executed the 1991 deed, and the final note was written on January 1, 1992, almost two weeks later. All of the notes were addressed to both parties.

As noted, the parties jointly occupied the Cedar Run property beginning in 1983, three years before marriage, and ending upon separation in 2006. When plaintiff moved into the property, it was under construction after having burned down in a fire in the late 1970's, and she, along with her sons and former husband, actually assisted in rebuilding the house. Defendant acknowledges that plaintiff contributed to the care and upkeep of the home.

In 1991 or 1992, at around the same time defendant executed the deed on the Cedar Run property, defendant recorded a deed transferring legal title to the Tahoe property jointly into both parties' names.*fn3 According to defendant, his intent for doing so, as with the marital home, was to protect his assets from potential medical malpractice judgments, and to avoid the federal estate tax in the event he predeceased his wife. Plaintiff, on the other hand, denied any such motive, and instead explained that the Cedar Run property was a gift from defendant's parents to the parties jointly, and that the inclusion of her name on the deed was to provide for her general financial well-being and to compensate for her work at defendant's medical practice. In any event, in 1990, the Tahoe property burned down and was rebuilt. The monies used for reconstruction came primarily from insurance proceeds but also from marital funds. Plaintiff traveled to Nevada to obtain building permits and oversee construction, the actual duration of her stay ranging somewhere between two to six months.

In marked contrast to the circumstances surrounding the parties' acquisition of their interests in these two properties, no one on appeal disputes that the West Creek office property, which housed defendant's medical practice, is defendant's separate asset immune from equitable distribution. This property was purchased by defendant's parents in 1976. On May 30, 1978, defendant signed a note to them in the amount of $37,000, and paid the note at the rate of $768 per month. After fourteen months, the note was deemed paid in full, but the deed to the office property was not actually transferred to defendant until December 27, 1991. At all times, plaintiff understood that defendant owned the building, and marital assets were not used for its maintenance.

Although plaintiff argued at trial that she acquired an equitable interest in the West Creek office property by virtue of her contribution to defendant's medical practice, the Family Part judge disagreed and held this asset non-"marital" and ineligible for equitable distribution. The judge reasoned that defendant had a sole equitable interest in the property prior to the marriage; the 1991 deed conveyed legal title to him alone; there was no evidence that marital assets were used to maintain the building or that defendant's parents intended to gift it to the parties jointly; and the asset was not commingled with other marital property. As noted, this ruling is not challenged on appeal.

On the other hand, the judge included both the Cedar Run and Lake Tahoe properties in the marital estate, awarding plaintiff a 45% share in the marital home and a 40% share in the vacation property. In doing so, he considered the factors enumerated in N.J.S.A. 2A:34-23.1. Regarding the Cedar Run property, the judge reasoned the marital home was maintained and improved using joint funds and that both parties contributed to its care and upkeep. Of paramount significance was the fact that, during the marriage, legal title had vested in both parties at the same time by operation of the same deed. In fact, prior to 1991, defendant never owned an outright fee simple interest in the property. Equally important, in a series of annual loan forbearance agreements issued to both plaintiff and defendant, defendant's parents had begun forgiving the loan on the Cedar Run property after the parties were married and ending roughly contemporaneous with the recordation of the deed in both parties' names. Specifically, the judge stated:

Legal title, however, actually vested in both plaintiff and defendant in the 1991 deed. The deed of transfer was a trustee's deed and it seems clear to infer that it was carrying out the wishes of his parents as well in deeding the property into both his and his wife's name. They had previously executed the various loan forgiveness agreements and made certain that Marie was a co-recipient even though there is no evidence of a loan document previously which she would have signed. At this time the marriage was in good stead and the relationship solid. There was nothing to indicate that Robert Miller likewise was not fully intending to transfer his share of any equitable interest he may have held into his wife as well.

Consequently, the judge found the Cedar Run property eligible for equitable distribution, but in recognition of defendant's pre-existent equitable interest as trustee, awarded him the larger share interest of 55%.

The judge reasoned similarly as to the Lake Tahoe property. Critical to the court's decision to include the asset in the marital estate was the fact that it appeared defendant's parents gifted the property to the parties jointly, evidenced by the loan forgiveness letters; that the parties never made any payments to defendant's parents; that plaintiff acquired a legal interest in the property by deed recorded in 1991 or 1992; that joint funds were since invested in the property and plaintiff oversaw its reconstruction; and that no prior deed was produced evidencing defendant's pre-marital ownership. Once again recognizing the origin of ownership and source of gifting, the judge awarded defendant the larger share -- 60%.

The second count of plaintiff's divorce complaint sought compensatory and punitive damages for alleged inter-spousal torts committed while the parties were married. At trial, plaintiff testified to various acts of domestic abuse occurring in February and March 2006, which included slamming her against the wall, screaming in her ear, punching her in the stomach, and putting a gun to her face. Although she produced medical records of treatment by her physician, plaintiff offered no medical experts. Defendant, on the other hand, denied causing her injuries. At the close of evidence, the judge found that plaintiff failed to "causally link any abusive behavior or misconduct with any particular injury" sustained as a result of defendant's conduct, and dismissed the claim. The judge concluded:

Plaintiff has testified to various assaults and offensive behavior by defendant; however, there is no testimony of any injuries or permanent damages sustained as a result of defendant's conduct. No expert was called to causally link any abusive behavior or misconduct [to] a particular injury.

Plaintiff testified to an extremely fragile and complex medical history detailed herein below independent of any allegation of further complications caused by defendant. The Court notes that in the course of the litigation plaintiff would have had the opportunity to retain the services of an examining physician relative to the tort litigation, but no such testimony was received at trial; accordingly, there is no evidence upon which the Court may determine that plaintiff has established a cause of action relative to the Tevis account in count two of the complaint and the Tevis action is dismissed.

On appeal, defendant argues that both the Cedar Run and Lake Tahoe properties are immune from distribution, and alternatively, that the trial court overvalued plaintiff's interest in both. Plaintiff cross-appeals, arguing that the trial court's dismissal of her Tevis claim was error. We disagree with both.

Appellate review pertaining to the equitable distribution of marital assets is narrow. Wadlow v. Wadlow, 200 N.J. Super. 372, 377 (App. Div. 1985). The standard is abuse of discretion, keeping in mind that a trial judge should not routinely or mechanistically divide the marital assets equally. Id. at 377, 382; see also Rothman v. Rothman, 65 N.J. 219, 232 n.6 (1974). Indeed, "[t]he word 'equitable' itself implies the weighing of the many considerations and circumstances that are presented in each case." Stout v. Stout, 155 N.J. Super. 196, 205 (App. Div. 1977). Those criteria are set forth in N.J.S.A. 2A:34-23.1, and in every case, the court must make specific factual findings with respect to all 16 factors. N.J.S.A. 2A:34-23.1.

To be sure, any property owned by a husband or wife at the time of marriage will remain separate property and in the event of divorce will be considered an immune asset ineligible for distribution. Valentino v. Valentino, 309 N.J. Super. 334, 338 (App. Div. 1998). By the same token, "[a]ll property, regardless of its source, in which a spouse acquires an interest during the marriage shall be eligible for distribution in the event of divorce." Painter v. Painter, 65 N.J. 196, 217 (1974). Of course, the burden of establishing immunity from distribution of a particular marital asset rests upon the spouse who asserts it. Pacifico v. Pacifico, 190 N.J. 258, 269 (2007).

Here, defendant claims both the Cedar Run and Lake Tahoe properties are immune from distribution because he owned them prior to the marriage and did not have the requisite donative intent to create marital assets since the deeds evidencing plaintiff's legal interests therein were executed simply to protect his assets from medical malpractice liability. On this score, whether a party's conveyance to a spouse constitutes a gift to "break the traceable chain of separate property" depends on whether there is "(a) donative intent on the part of the donor[;] (b) actual (or symbolical) delivery of the subject matter of the gift[;] and (c) an absolute relinquishment by the donor of all ownership and dominion over the subject matter of the gift, at least to the extent practicable or possible, considering the nature of the thing given." Canova v. Canova, 146 N.J. Super. 58, 61 (Ch. Div. 1976).

Defendant's claim fails for a number of reasons. First and foremost, he has not met his burden of proving he owned the properties in question in fee simple prior to the marriage. Concerning the Cedar Run property, the deed of trust from his parents, if anything, evidences an intent not to convey full legal title until defendant paid his parents full value. Corroborative of this intent are the parents' annual agreements forgiving defendant's loan on the property, and naming plaintiff as a co-recipient. Although plaintiff was not a party to the original loan, the parents' inclusion of her in the loan forbearance agreements clearly evidences an intent to in effect "gift" the property to the parties jointly. Since defendant held title only as trustee until 1991 while still receiving loan forgiveness, it is more likely defendant transferred the Cedar Run property as trustee to the parties jointly because his parents intended such a result.

But even if he owned the property outright prior to the marriage, the preponderant proofs admit of the requisite donative intent, and defendant's assertion to the contrary was discredited by the trial judge, a finding to which we usually defer. State v. Locurto, 157 N.J. 463, 470-71 (1999); Cesare v. Cesare, 154 N.J. 394, 412 (1998). Indeed, the parties were married at the time of the deed's execution in 1991, which presumes a partnership, Pascale v. Pascale, 140 N.J. 583, 609 (1995), and at that time the trial judge found the relationship to be strong.

Moreover, "[p]roperty 'clearly qualifies for distribution' when it is 'attributable to the expenditure of effort by either spouse' during marriage." Ibid. (quoting Painter, supra, 65 N.J. at 214). Here, the parties occupied the premises jointly for 23 of the 30 years that defendant possessed it prior to separation; and plaintiff contributed to rebuilding the property after it burned down and to maintaining the property throughout the time she lived there. The parties used marital funds to maintain and improve the property, and plaintiff acquired legal title five years into the marriage. Because marriage is viewed as a shared enterprise, ibid., we find this property clearly falls within the category of a marital asset.

We are also satisfied that the 55%-45% split of the Cedar Run property was a proper exercise of the court's discretion for these very same reasons. Defendant acquired possession of the property in 1976 yet only lived in it by himself for six years until 1983, when the parties occupied it jointly. Thus, the trial court's division of slightly more than half to defendant accurately reflects this comparison, and recognizes that while defendant acquired an equitable interest in the property before plaintiff moved in, even prior to the marriage plaintiff devoted effort to rebuilding the house once it burned down, and during the marriage, joint assets were used to maintain it. What is more, the parties held legal title to the property for the same period of time, beginning in December 1991.

This same reasoning applies to the Lake Tahoe property. Legal title to this property was held jointly by plaintiff and defendant beginning in 1991 or 1992. Defendant, however, produced no documentary evidence to show that he owned the property before that time as no deed was ever produced. As with the Cedar Run property, the Lake Tahoe property was likely transferred to the parties jointly as a gift, there being no credible evidence in the record contradicting that determination.

Having established joint ownership, the court's division of the Lake Tahoe property properly recognized each party's contribution to its acquisition and preservation. N.J.S.A. 2A: 34-23.1(i). In this regard, although no marital assets were used to acquire the property, some marital funds were invested to reconstruct and maintain it after the fire. Moreover, plaintiff spent several months in Nevada hiring and overseeing contractors, and acquiring building permits, no doubt a valuable service to the marriage at the time. Thus, the court's 60%-40% split properly reflected plaintiff's significant contribution toward preserving the marital asset while at the same time recognizing its originating source. We find no error in this equitable distribution.

Nor do we perceive error in the dismissal of plaintiff's Tevis claim. "[T]ortious conduct generally encompassing not only conventional negligence but also intentional acts, as well as other forms of excessive behavior such as gross negligence, recklessness, wantonness, and the like," are excepted from inter-spousal immunity. Tevis v. Tevis, 79 N.J. 422, 426 (1979). Thus, some non-economic marital fault may be compensated in appropriate cases. Id. at 434.

Here, although plaintiff testified to several acts of abuse by defendant during the marriage, she produced no medical proof explaining her injuries or establishing the cause thereof. As the judge adeptly noted, her documented injuries could have resulted from plaintiff's myriad health problems. Thus, absent the requisite medical proof as to the nature, origin and cause of plaintiff's injuries, the dismissal of her Tevis claim was proper.


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