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Good v. Nedza

SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION


December 8, 2009

DAVID R. GOOD, PLAINTIFF-APPELLANT,
v.
DENISE M. NEDZA, DEFENDANT-RESPONDENT.

On appeal from Superior Court of New Jersey, Chancery Division, Family Part, Monmouth County, Docket No. FM-13-0968-02-A.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Submitted September 16, 2009

Before Judges Payne, C.L. Miniman and Waugh.

Plaintiff David R. Good appeals from the denial of his April 14, 2008, motion for an increase in child support retroactive to January 1, 2006. In that motion, he alleged that defendant Denise M. Nedza made a fraudulent representation to him and the court about her income that caused him to enter into a January 11, 2006, consent order, which in part established her child-support obligation at $125 per week for the parties' three children, retroactive to January 1, 2006. Because the time for relief from the January 2006 order expired after one year pursuant Rule 4:50-2, and because plaintiff failed to demonstrate a change in defendant's income subsequent to that date, we affirm.

I.

On November 7, 2002, a final dual judgment of divorce was entered dissolving the parties' marriage. Three children were born to the marriage: a daughter in 1990, a son in 1991, and another daughter in 1995.

At the time of the divorce, plaintiff was employed in a lucrative position and defendant was the homemaker. In the Property Settlement Agreement (PSA) incorporated into the divorce judgment, the parties agreed they would share joint legal custody of their children and that defendant would have primary residential custody of the children. Plaintiff agreed to pay $330 per week in child support, which would be reviewed three years after execution of the PSA, if appropriate.

Subsequently, a July 20, 2004, order was entered upon joint application of the parties granting plaintiff residential custody of the parties' son, with defendant retaining residential custody of their daughters. The order further provided:

The parties agree that the current child support arrangements shall continue until such time as modified pursuant to the Final Judgment of Divorce. Husband acknowledges that until such time as the modification occurs, and the same is anticipated in August of 2005, he will not be in need of child support from the wife. He shall continue to pay the current level of child support to wife which he is now paying to her.

When it came time for the August 2005 review, plaintiff alleged defendant misrepresented her employment status by claiming that she was unemployed when she had actually been working as the manager of a recording studio in New York City since the summer of 2003. Further, plaintiff sought a transfer of custody of the parties' two daughters. In support of plaintiff's claim that defendant misrepresented her employment status, plaintiff attached an article published in New York Magazine on November 10, 2003, that identified defendant as the manager of The Studio in New York City. Additionally, plaintiff engaged a private detective service that verified defendant was then employed by The Studio and that she "ran the place" when the owner was not present.

On August 11, 2005, defendant submitted a certification in opposition to plaintiff's motion in which she stated that she was "totally reliant upon . . . alimony," and that she was "not currently employed but [was] seeking full-time employment." In an updated Case Information Statement (CIS) dated August 12, 2005, defendant certified that she was to start a new part-time job on September 12, 2005, at which she expected to earn $300 per week in addition to the $450 weekly alimony she was receiving. Defendant's 2004 federal income tax return showed her only income to be $23,400 in alimony plus $46 in taxable interest.

On September 7, 2005, a consent order was entered transferring residential custody of the parties' two daughters to plaintiff. That order terminated plaintiff's child-support obligation. It further provided that defendant's child-support obligation was to be based upon plaintiff's annual income of $150,000 and defendant's imputed annual income of $25,000, pending review at a plenary hearing. The parties thereafter engaged in discovery, including a deposition of defendant in which she was confronted with the New York Magazine article and the report of the private investigator. After discovery was completed and in anticipation of the scheduled plenary hearing, the parties consented to a January 11, 2006, order setting defendant's weekly child-support obligation at $125 per week for the three children retroactive to January 1, 2006.

On April 14, 2008, plaintiff filed an application seeking an increase in child-support payments based on an imputed income to defendant of "$85,000.00 per year direct salary plus $25,000 subsidized life style (free apartment, Jaguar, vacations)." In the application, plaintiff claimed that increased child-support payments should be made retroactive to January 1, 2006, because defendant's "income was erroneously imputed at $25,000.00 as a direct result of [d]efendant's misrepresentation as to her true income." Plaintiff also moved for [c]hild [s]upport arrears to be calculated retroactive for the period July 1, 2004 through December 31, 2005 - when defendant misrepresented her employment status and failed to disclose that she had been employed for one year as of July 2004.

Additionally, plaintiff sought to compel defendant to contribute to the children's unreimbursed medical expenses and college tuition and related expenses. He further sought the transfer of certain funds to the children's savings accounts, repayment of a duplicate child-support payment, contribution to the eldest daughter's automobile, and other relief.

The relief sought was opposed by defendant, who cross-moved to reduce her child-support obligation, to clarify the parties' entitlement to income tax deductions and credits, and to obtain other relief. Defendant denied ever misrepresenting her income and asserted that all of the issues respecting same "were definitely and conclusively resolved by the January 11, 2006, order." Defendant sought recalculation of child support based on plaintiff's 2007 income of $185,648 and her 2007 income of $26,064. The motion and cross-motion were argued on June 6, 2008.

II.

On June 12, 2008, the judge placed an oral decision on the record and entered an order that day, which partially granted and partially denied plaintiff's motion. Specifically, the judge denied plaintiff's motion to impute income to defendant and retroactively apply the imputed income to defendant's child-support obligation because the motion was untimely under Rule 4:50. The judge permitted recalculation of child support after an exchange of financial information, "including Case Information Statements, 2007 tax returns, W-2's, 1099's and the last three current pay stub[]s."*fn1 The new child-support obligation would be retroactive to April 15, 2008, the filing date of plaintiff's motion. The judge found an overall lack of evidence to support plaintiff's contentions about defendant's employment status, in part because he found the private detective's report speculative and conclusory. Moreover, the January 11, 2006, consent order was executed by plaintiff in January 2006 after he had full knowledge of the allegations again being raised in his 2008 motion.

Next, the judge applied the doctrine of laches to deny plaintiff's application for payment of certain unreimbursed medical expenses for 2006 and 2007. Additionally, the plaintiff failed to provide defendant with proper notice of the charges, failed to prove that payment by the insurance carrier was denied, and failed to account for the first $250 of medical expenses as being included in child-support payments. Defendant's request for reimbursement of a double support payment made in 2004 was also denied based on laches.

Regarding payment of the eldest daughter's college expenses, the judge concluded that defendant should be responsible for "twenty-five percent of her share unless she demonstrates a modified ability to pay at the time of the calculation for support." The judge ordered defendant to transfer the children's bank accounts to plaintiff. Finally, plaintiff's motion to compel defendant to contribute to the eldest daughter's automobile was denied as not included in the shared expenses to which the parties agreed in the PSA.

Plaintiff filed this appeal before child support was recalculated by the judge because "[u]nless [there is] a full- blown hearing on the issues raised in [his] application[,] there can be no salutary resolution." Plaintiff contends on appeal that a plenary hearing on the issue of defendant's income was required; the limited discovery allowed was insufficient to disclose defendant's fraudulent conduct, depriving him of due process; and the Family Part judge erred by not asserting the State's parens patriae jurisdiction to prevent defendant's continuing fraud, prejudicing their children's right to receive adequate child support and a college education.

Defendant contends the judge properly refused to consider plaintiff's claims of fraud and misrepresentation, but urges that he erred in requiring her to pay twenty-five percent of college expenses. However, she did not file a cross-appeal of that ruling and it is not properly before us.

III.

Our review of the denial of plaintiff's application for modification of the January 11, 2006, order based on continuing fraud and misrepresentation by defendant since the summer of 2003 is plenary because such an application is governed by Rule 4:50, the interpretation and application of which is purely a question of law. Manalapan Realty, L.P. v. Twp. Comm. of Manalapan, 140 N.J. 366, 378 (1995). Rule 4:50-1 provides:

On motion, with briefs, and upon such terms as are just, the court may relieve a party or the party's legal representative from a final judgment or order for the following reasons: (a) mistake, inadvertence, surprise, or excusable neglect; (b) newly discovered evidence which would probably alter the judgment or order and which by due diligence could not have been discovered in time to move for a new trial under R. 4:49; (c) fraud (whether heretofore denominated intrinsic or extrinsic), misrepresentation, or other misconduct of an adverse party; (d) the judgment or order is void; (e) the judgment or order has been satisfied, released or discharged, or a prior judgment or order upon which it is based has been reversed or otherwise vacated, or it is no longer equitable that the judgment or order should have prospective application; or (f) any other reason justifying relief from the operation of the judgment or order.

[R. 4:50-1.]

Defendant's allegations of fraud and misrepresentation fall within the scope of Rule 4:50-1(c). None of the other subsections apply to plaintiff's claim for relief from the January 11, 2006, order. That being so, plaintiff's claim is governed by Rule 4:50-2, which provides that any motion for relief from an order or judgment under Rule 4:50-1(a), (b), or (c) shall be made "not more than one year after the judgment, order or proceeding was entered or taken." Plaintiff's application for relief from the January 11, 2006, order failed to comply with the mandate of Rule 4:50-2 and the Family Part judge correctly denied the relief requested as untimely.

Furthermore, even if the time constraint of Rule 4:50-2 could be relaxed, and we do not suggest that it could, plaintiff would be a poor candidate for such relief. Plaintiff had litigated the alleged fraud and misrepresentations by defendant before he settled his claims for increased child support in 2006. He consented to the entry of the January 11, 2006, order prior to a plenary hearing that would have allowed him to present his claims for judicial determination. Having settled those claims in 2006, he may not revive them now. Kelleher v. Lozzi, 7 N.J. 17, 26 (1951). As a result, plaintiff was clearly not entitled to a plenary hearing on his application for retroactive modification of child support.

IV.

With respect to prospective modification of child support from the date plaintiff filed his motion, April 15, 2008, he contends the Family Part judge unduly restricted the scope of discovery allowed. Specifically, the judge required an exchange of current financial information, including case information statements, tax returns, W-2s, 1099s, and the last three current pay stubs. The judge found plaintiff met the test for demonstrating changed circumstances under Lepis v. Lepis, 83 N.J. 139 (1980), and no appeal has been taken from that portion of the June 12, 2008, order. Indeed, in a cross-motion defendant also sought a recalculation of child support.

An application for increased child-support payments based upon changed circumstances need not include a hearing when the material facts are not in genuine dispute. We therefore hold that a party must clearly demonstrate the existence of a genuine issue as to a material fact before a hearing is necessary. . . . Without such a standard, courts would be obligated to hold hearings on every modification application. . . .

In determining whether a material fact is in dispute, a court should rely on the supporting documents and affidavits of the parties. Conclusory allegations would, of course, be disregarded. Only statements to which a party could testify should be considered. Thus, if the sole dispute centered around the supporting spouse's earnings, the disclosure of income tax returns might render a hearing unnecessary. [Lepis, supra, 83 N.J. at 159 (internal citations omitted).]

Thus, the first step to be taken after a party has made the threshold showing of changed circumstances under Lepis is to require the exchange of financial information. That is precisely what the Family Part judge did here. In fact, the parties had already exchanged that information and had only to produce their pay stubs for the three weeks preceding June 12, 2008. Plaintiff presented no new information that would suggest any further discovery was warranted, and the information he did present were not statements within his personal knowledge but were mere conclusory allegations not meriting a plenary hearing. Ibid. Moreover, as the dispute centers around defendant's earnings, the exchange of income tax returns renders a plenary hearing on that issue unnecessary. Ibid. In any event, the judge did not foreclose the possibility of a future plenary hearing to resolve disputed issues in the event the financial information did not "render a hearing unnecessary." Ibid.

The facts of this case are entirely distinguishable from those in Von Pein v. Von Pein, 268 N.J. Super. 7 (App. Div. 1993) and Rolnick v. Rolnick, 290 N.J. Super. 35 (App. Div. 1996). In Von Pein, the supporting spouse engaged in fraudulent conduct to conceal income and assets that were only discovered after the final judgment of divorce was entered. Von Pein, supra, 268 N.J. Super. at 12-13. Alimony and equitable distribution had been ordered after a full trial of the issues in the divorce proceeding. Id. at 10-11. In Rolnick, the fraud was discovered during the course of a plenary hearing on an application to enforce a PSA. Rolnick, supra, 290 N.J. Super. at 39. Here, all of the facts on which plaintiff relies to support his claims of fraud and misrepresentation were discovered by him before he consented to the entry of the January 11, 2006, order. Having settled those claims by agreeing to a final child-support amount based on defendant's imputed income of $25,000, plaintiff may not now seek to litigate them anew. Kelleher, supra, 7 N.J. at 26. Rather, he was required to submit evidence of fraud or misrepresentation in connection with the 2008 application.

Affirmed.


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