March 4, 2010
ROBIN RUDNITSKY, PLAINTIFF-APPELLANT/ CROSS-RESPONDENT,
GARY RUDNITSKY, DEFENDANT-RESPONDENT/CROSS-APPELLANT.
On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Essex County, Docket No. FM-07-1549-07.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued February 3, 2010
Before Judges Axelrad, Fisher and Espinosa.
In this matrimonial appeal, we examine a number of determinations made by the Family Part judge at the conclusion of an eight-day trial. We affirm in part, modify in part, and remand for the entry of an amended judgment.
The record reveals that plaintiff Robin Rudnitsky and defendant Gary Rudnitsky were married in 1987. At the time of the marriage, Robin was thirty years old. She had previously earned a bachelor's degree in business and communications, and was employed as a commercial leasing broker. Gary, at the time of the marriage, was twenty-five years old. He had previously completed dental school, and worked as a cosmetic dentist. Prior to the birth of their first child in 1991, Robin left the workforce; their second child was born in 1993. Robin remained primarily responsible for the children's care during the remainder of the marriage.*fn1
In her appeal, Robin argues that the judge erred: in fixing the amount of alimony; in suggesting that Gary's contributions toward the children's Bar and Bat Mitzvahs could be considered in the future when allocating college costs; in determining that Gary's retirement would constitute a changed circumstance that would terminate alimony; and in finding that Gary's interest in Sedana Realty LLC (Sedana), was a passive immune asset. She also argues that, should there be a remand, another judge should be assigned to the matter. In his cross-appeal, Gary argues that the judge erred in disposing of the parties' claims for counsel fees.
Alimony is "an economic right that arises out of the marital relationship." Mani v. Mani, 183 N.J. 70, 80 (2005). When sought, the judge must consider the following factors:
(1) The actual need and ability of the parties to pay;
(2) The duration of the marriage or civil union;
(3) The age, physical and emotional health of the parties;
(4) The standard of living established in the marriage or civil union 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 or civil union 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. [N.J.S.A. 2A:34-23(b).]
In reviewing an alimony award, we must give due deference to the judge's factual findings because family judges possess specialized expertise; those findings must be affirmed on appeal if supported by substantial, credible evidence based on a review of the record as a whole. Mani, supra, 183 N.J. at 92; Genovese v. Genovese, 392 N.J. Super. 215, 222 (App. Div. 2007); Cox v. Cox, 335 N.J. Super. 465, 473 (App. Div. 2000).
The judge awarded Robin permanent alimony of $6000 per month. Robin contends that this award was insufficient and the judge's findings inadequate. We disagree.
In implicitly focusing on the statutory factors, the judge recognized that at the time of trial Robin was not earning any income, but he found she had the capacity to generate income. In addition, the evidence revealed that Robin's parents made contributions to a trust for her benefit and had, during the course of the marriage, gifted her anywhere from $12,000 to $28,000 per year, which she spent on jewelry, clothing or other items. Robin's mother also paid for many of her vacations, including a trip to Italy in 2006, and trips to Florida, California, the Caribbean and London in 2007. In light of this and other information, the parties stipulated that Robin had a gross annual income of $80,000.
Gary is a cosmetic dentist with offices in Manhattan and New Jersey. At the time of trial, Gary's schedule included working Monday through Thursday in Manhattan and Friday in New Jersey. The parties stipulated that Gary had a gross annual income of $400,000.
The parties had been married for twenty years at the time Robin filed this divorce action. At that time, Robin was forty-nine years old and Gary was forty-four years old.
The record also revealed that Robin has experienced significant health problems. When she was seventeen, Robin was diagnosed with Hodgkin's disease, for which she underwent a year of radiation and chemotherapy, and, as a result, developed a thyroid disease. In 1991, after the birth of the first child, Robin underwent surgery to repair what was referred to as a hole in her heart. In 2001, she was diagnosed with breast cancer, had a double mastectomy, and endured a lengthy breast reconstruction process. She also developed alopecia areata, for which she received approximately fifty cortisone injections, and suffers from a herniated disk. In 2006, Robin developed an arrhythmnia for which she was hospitalized and eventually underwent a catheter ablation.
Notwithstanding her considerable medical history, Robin's testimony revealed that she then had no complaints that would impact on the fixing of alimony. For example, Gary's counsel asked on cross-examination whether she had recently incurred any expenses resulting from her health problems:
Q: Do you have any health issues at the present time that require you to have funds available to you [sic] access the [trust] funds?
A: Well, I've been told that my heart -- I have a weak heart by my doctor.
Q: That's not my question.
Q: My question is -
A: Health problems right now?
Q: -- do you have problems now where you need money for your health -
Q: -- expenses?
A: Not this second.
The judge also considered the parties' marital lifestyle. He found -- and the evidence overwhelmingly supports the finding -- that the parties lived an extravagant lifestyle in which they spent everything they received. In examining this factor, the judge rejected the notion that the award of alimony should permit Robin an extravagant lifestyle by impoverishing Gary:
[a]s to alimony, it is clear that these parties spent every dollar that [Gary] earned during the intact portion of the marriage. Crews v. Crews[,] 164 N.J. 11 (2000) talked about maintaining the marital lifestyle for both parties. This does not mean that [Gary] gives his pool of earnings to his soon to be former wife and lives without available monies for himself. Both are entitled to have vacations, not just [Robin].
In addition, the judge considered Robin's access to a trust, with a corpus valued at the time of trial at $1,100,952.30, which was established by her parents for her sole benefit. Robin also had an interest in a pension plan that was valued at $266,632. The judge also considered Gary's interest in Sedana.
Robin argues that the trial judge failed to cite to the many factors outlined in N.J.S.A. 2A:34-23(b). It may be true that the judge's decision did not set forth a mechanical description of each factor and the judge's specific finding as to each. But we have no doubt from his recitation of the critical facts and the entire tenor of his written decision, that the experienced Family Part judge considered all the relevant statutory factors and critically analyzed those factors in making a permanent monthly alimony award to Robin of $6000.*fn2
As the judge explained, the alimony award would, when added to her stipulated gross annual income of $80,000, provide Robin with a gross income of $152,000. In addition, the judge indicated that the deduction of the alimony payments from Gary's gross annual income would leave him with a gross annual income of $328,000. The judge then considered the effect of federal income taxation, which would leave Gary with a net available annual income of slightly more than $200,000, and Robin with a net available annual income of $119,880. And, when factoring the annual child support payment of $31,200, as the judge explained, the parties were essentially left in equal economic positions, i.e., Gary would be left with an annual net income of $168,945 and Robin with an annual net income of $151,080.
In carefully reviewing the record in light of the parties' arguments, we conclude that the judge applied the statutory factors and achieved "the goal of a proper alimony award" by providing both parties with "a lifestyle that is reasonably comparable to the one enjoyed" prior to their separation. Steneken v. Steneken, 183 N.J. 290, 299 (2005) (quoting Crews, supra, 164 N.J. at 16).
II. COLLEGE EXPENSES
Robin also argues that the judge erred in determining that Gary's $220,000 contribution to the Bar and Bat Mitzvahs of the children, which came from Gary's interest in Sedana, could be considered in the future when allocating college costs.
At the time of the judge's decision, the oldest child was still in high school and only at the point of applying to colleges for admission. In anticipating a future dispute about the allocation of colleges expenses for that child, as well as the youngest child, the judge stated in his decision that Gary had singularly paid for the children's religious celebration[s] (Bar and Bat Mitzvah) with over $200,000 in immune assets from Sedana Realty. The parties had the ability to share this obligation, yet [Gary] alone bore these costs. The court determines that [Robin] has the ability to use her assigned assets [i.e., the trust fund] and further has the ability to gain employment. While college costs are only one year away, the court must know the actual costs before assessing payment contribution. Both parents will be participating in these costs.
Th[ey] should strive to reach agreement on this issue to avoid the need for court intervention. The prior use of [Gary's] assets for the children should also be considered in determining the allocation of each parent's responsibility for these costs for their children.
Robin argues that the judge was mistaken in concluding that Gary's payment toward the religious celebrations may constitute a credit against any future obligation he may have toward the payment of college expenses. Although Robin's argument is certainly colorable, we need not reach its merits. Counsel advised at oral argument that the parties have so far consented to the allocation of those college expenses incurred to date without consideration of the cost of the religious celebrations. Moreover, we hold that the judge was premature in assessing whether this should be a factor in any future court-imposed allocation of college expenses. Because the issue had not ripened into an actual controversy at the time of decision, the judge's comments on this point were purely advisory and should not be binding on any future determination.
III. RETIREMENT AS A CHANGED CIRCUMSTANCE
Robin also argues that the judge erred in concluding that Gary's future retirement would constitute a changed circumstance that would terminate alimony. Specifically, the judge found that [r]etirement shall be a change of circumstances in regard to permanent alimony.
When [Gary's] earned income ends, [Robin] has sufficient access to assets which can serve as "replacement alimony." [Gary] may make an application for elimination or reduction of alimony at the time of his retirement and the court at that time will consider the value of all the assets accumulated and available to the parties.
We agree that the judge was premature as to what ought to occur whenever Gary, who was forty-six years old at the time of trial, retires. Such "prospective termination provisions" are inappropriate. Boardman v. Boardman, 314 N.J. Super. 340, 346 (App. Div. 1998). Whether or to what extent Gary's future retirement impacts his alimony obligation should be determined upon the actual circumstances then existing and not on a prognostication of what should happen years from now. Ibid.
We, thus, conclude that this part of the judge's decision was also advisory and should have no bearing whenever Gary's future retirement may occur.
IV. ROBIN'S REMAINING ARGUMENTS
In the fourth point of her brief, Robin argues that the judge erred in concluding that Gary's interest in Sedana, which was a gift from his father, was a passive immune asset and that any increase in its value was not subject to equitable distribution. And, in her fifth and last point, Robin contends that "the trial judge's dislike of [her] trial positions affected his decisions and requires that [any] remand be assigned to another judge." We find insufficient merit in these arguments to warrant discussion in a written opinion. R. 2:11-3(e)(1)(E).
V. GARY'S CROSS-APPEAL
In his cross-appeal, Gary argues that the judge erred in resolving the parties' competing claims for counsel fees. The judge found that Robin had incurred $366,000 in counsel and expert fees, and that Gary had incurred $283,000 in counsel fees. Robin's mother had paid $305,000 of her fees; the remainder was outstanding at the time of trial.
The experienced judge made the following observations about the parties' counsel fees in his written decision of October 16, 2008:
When fees become this high, it is difficult for the case to settle, because the issue of fees becomes larger than the issues in the case. These cases, where the fees are unaffordable and where the fees extinguish a significant portion of the assets[,] are very difficult for a judge to make a decision that is fairly balanced. While not bad faith, a position with little chance of being successful or prevailing under the facts by application of the law should not be encouraged or reimbursed.
While here, [Gary] has the greater level of earnings, it was [Robin's] pursuit of Sedana Realty and its unnecessary valuations that caused much of these fees.
In [Robin's counsel's] letter of October 8, 2008 he states... "the issues in the case that consumed the majority of the time and fees were the complex valuation issues related to Sedana and the issues involving the immunity of Sedana and [Robin's] trust. The court in reviewing the negotiation history can only conclude that pursuit of this immune asset was done to cause capitulation on the alimony issue.
While the court believes that [Gary] has the greater ability to reacquire assets due to his higher earnings, [Robin] expended nothing from her holdings as her mother has been the benefactor in paying all her fees.
As a result of these and other facts, the judge exercised his discretion and ordered that Gary pay Robin $50,000, i.e., only fourteen percent of the total fees she incurred.
We find no abuse of the judge's exercise of discretion in disposing of the fee applications, Williams v. Williams, 59 N.J. 229, 233 (1971), and affirm the counsel fee determinations substantially for the reasons set forth in the judge's written decision of October 16, 2008.
Affirmed in part; modified in part; and remanded for the issuance of an amended judgment in conformity with this opinion.*fn3