On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Morris County, Docket No. FM-14-634-97.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Before Judges Wefing, Grall and Messano.
In this post-judgment Family Part action, plaintiff Terry J. Hart appeals from various provisions of three orders: 1) the July 9, 2008 order (the July order) denying his motion for a downward modification of his alimony obligation and granting other relief to his ex-wife, defendant Wendy M. Hart; 2) the October 30, 2008 order (the October order) denying his motion for reconsideration, and granting defendant further relief; and 3) the December 9, 2008 order (the December order) that followed defendant's motion for reconsideration and that compelled the production of an unredacted copy of plaintiff's 2005 tax return, and granted defendant additional relief. We have considered the arguments raised in light of the record and applicable legal standards. We reverse and remand the matter to the trial court for further proceedings consistent with this opinion.
This is the second time the matter is before us based upon plaintiff's post-judgment request to modify his alimony obligations. We reference the essential background facts as set forth in our earlier opinion. See Hart v. Hart, No. A-5252-05 (App. Div. November 27, 2007).
Plaintiff and defendant were married in 1975 and have two adult children. They separated on October 15, 1996, and were divorced on May 12, 1999 when both were fifty-two years old. Id. (slip op. at 2). "Plaintiff holds an engineering degree from Lehigh University, and masters degrees from MIT and Rutgers University." Id. (slip op. at 3). From 1978 to 1984, plaintiff participated in NASA's astronaut program, and relocated the family to Houston, Texas. Ibid. Upon returning to New Jersey, "plaintiff was employed by Bell Labs/AT&T." Aside from some part-time jobs, "defendant did not work outside the home[,] [and] [i]nstead . . . car[ed] for the home and support[ed] her husband's career." Ibid. "The parties enjoyed a comfortable lifestyle," "lived in a five-bedroom home in Morris Plains[,]" plaintiff was a member at a private country club, and "[b]oth children attended private schools." Ibid.
In 1997, "AT&T sold its satellite company to Loral SpaceCom, [and] plaintiff was hired as president of the new division, Loral SkyNet." Ibid. In 1998, the year before the divorce, plaintiff earned $312,538. Id. (slip op. at 4). In the property settlement agreement (PSA) incorporated in the divorce judgment, plaintiff agreed to pay defendant $6250 per month in permanent alimony until the parties' youngest child graduated from college, and thereafter alimony payments would increase to $8000 per month. Ibid. The marital home was to be sold, and the net proceeds divided. Ibid.
After the divorce, defendant purchased and lived in a condominium, but eventually moved into a rented apartment. Ibid. Plaintiff remarried, purchased and moved to a seven-acre property in Pennsylvania adjacent to a country club, joined the club, and adopted a newborn child. Ibid. "[P]laintiff's income continued to escalate [after the divorce], and he continued to maintain a very comfortable lifestyle . . . above that which he and defendant experienced during their marriage." Id. (slip op. at 5).
In 2004, plaintiff's company filed for bankruptcy and he was terminated from his position; at the time, his salary was $380,000, "and he received an eighteen-month severance package . . . ." Ibid. As the severance package neared expiration in February 2006, plaintiff moved for modification of the PSA to reduce his alimony payments. Id. (slip op. at 8). He set forth his efforts to locate other employment, which were unsuccessful, except that he obtained a full-time teaching position at his alma mater commanding a salary of $80,000. Id. (slip op. at 5-6). Plaintiff's CIS that accompanied the motion demonstrated that he had a net worth of $2.6 million, and gross income for the year 2004 from various sources that approximated $1 million.*fn1
Id. (slip op. at 7). An amended CIS filed by plaintiff indicated that his income for 2005 was more than $525,000. Id. (slip op. at 8).
Defendant opposed the motion, and cross-moved for other relief. Although both parties requested oral argument, the judge decided the issues on the papers. Ibid. The judge concluded plaintiff had sufficient assets to meet his alimony obligations; he denied defendant's requests. Id. (slip op. at 9). Both parties sought reconsideration, once again asking for oral argument; without granting oral argument, the judge denied plaintiff's motion, but granted defendant some limited relief and counsel fees. Id. (slip op. at 10-11).
Plaintiff again sought reconsideration and defendant again opposed and cross-moved to enforce litigant's rights. Id. (slip op. at 12). The judge denied plaintiff's motion, granted defendant's cross-motion, and ordered plaintiff to provide defendant with all the tax information that supported his applications to the court. Ibid. He further ordered plaintiff to pay defendant's counsel fees and found that plaintiff violated defendant's rights by failing to pay alimony. Ibid. Plaintiff appealed.
We found plaintiff's argument supporting a downward modification of the PSA based upon changed circumstances to be "unpersuasive." Id. (slip op. at 14). We further found no basis to set aside the motion judge's conclusion that "considering the substantial assets plaintiff acknowledged owning, the income imputed from these assets, and plaintiff's earned and unearned income, there was a sufficient basis for continuation of the $8,000 per month alimony figure." Id. (slip op. at 15). We affirmed the orders under review. Id. (slip op. at 16). After we subsequently denied plaintiff's motion for reconsideration, the Supreme Court denied his petition for certification.
Less than three weeks later, plaintiff again moved for a downward modification of his alimony obligations under the PSA, specifically seeking a reduction to $3000 per month, retroactive to March 1, 2006. He requested oral argument.
The certification in support of the motion rehashed much of what we have set forth above. Plaintiff claimed to have made $88,961 in 2007 while working as a professor at Lehigh University and a consultant "in the satellite industry." He documented the efforts he had made to find executive positions with various corporations during 2006 and 2007.
Regarding his assets, plaintiff referred to the CIS that accompanied the motion, and claimed a net worth of $1,651,899, the lion's share of which was his "half interest" in the home that he owned with his new wife. There was now no mortgage on the property. Plaintiff argued that defendant "should have no claim" to his home and his pensions, which defendant shared as part of equitable distribution, or his inheritance from his mother. Plaintiff sought a downward modification of his alimony obligations, or, alternatively, a plenary hearing on the issue, and counsel fees.
Defendant opposed the motion and cross-moved for relief, also seeking oral argument. She noted that plaintiff continued to violate prior orders as well as the award of counsel fees we made after plaintiff's unsuccessful appeal. Defendant noted that plaintiff had "unilaterally decided" not to pay the $8000 per month alimony obligations required under the PSA, and, instead began paying only $3000 per month after he lost his position with Loral. Defendant asked the judge to "set arrears at $132,000 as of June 1, 2008 . . . and enter judgment against plaintiff for this amount."
Defendant also asked the judge to "freeze" plaintiff's "retirement plans and garnish the payments [she] [wa]s entitled to receive," as well as plaintiff's salary. Defendant also contended that plaintiff failed to pay her the portion of his military pension to which she was entitled under the PSA, failed to make her the recipient of the pension's survivor benefits, and failed to furnish the 2005 tax return ordered to be provided by prior court order in 2006. Defendant also noted that plaintiff had failed to pay counsel fees of more than $13,000 as a result of the 2006 motion practice and appeal.
Plaintiff's reply certification sought to rebut defendant's claim that he led a "jet-setter" lifestyle. He argued that defendant was not entitled to survivor benefits under his military pension. Regarding his 2005 tax return, plaintiff contended that because it was a joint return and contained his new wife's personal information, he should not be required to provide it to defendant. In sum, plaintiff argued that he was entitled to a "retroactive and/or downward modification of alimony" based upon more than "two years of making a fraction of [his] earnings at the time the [PSA] was entered . . . ."
The motion judge entered an order on July 9, 2008, along with an accompanying written statement of reasons. He explained that he "d[id] not need to conduct oral argument in order to decide the issues in contest[,]" further finding that the "papers submitted present[ed] [no] genuine matter in dispute[,]" and "that oral argument w[ould] [not] . . . assist [him] in reaching a decision." We limit our discussion to those paragraphs of the July order that are the subject of plaintiff's appeal.
In paragraph 1, the judge denied plaintiff's request for a downward modification of alimony, ordered him to "take all steps necessary . . . to pay $8,000 per month[,]" and denied plaintiff's "request for a plenary hearing" (paragraph 3). The judge found plaintiff to be "in violation of litigant's rights for failing to pay alimony pursuant to . . . [the PSA] and post-judgment orders" (paragraph 4), and set "arrears at $132,500, the amount of alimony . . . . plaintiff failed to pay [defendant] through June 2008 . . . ." (Paragraph 5). The judge entered judgment in favor of defendant against plaintiff in that amount (paragraph 6), and granted defendant counsel fees in the amount of $4,266.06 to be paid within thirty days. (Paragraph 15).
The judge reasoned that plaintiff had failed to make a prima facie showing of changed circumstances to warrant a reduction in alimony, concluding that "[a]lthough the supporting spouse's income earned through employment is central to the modification inquiry, it is not the only measure of the supporting spouse's ability to pay . . . ." Based upon the CIS, the judge found that plaintiff had assets totaling $1.65 million and no longer maintained a mortgage on his home. He concluded that "during the period when plaintiff claimed that he was unable to meet his $8,000 monthly alimony obligation . . . [,] he was able to afford mortgage payments of $25,769 per month on average ($670,000 mortgage/26 months)." Citing Miller v. Miller, 160 N.J. 408 (1999), and Stiffler v. Stiffler, 304 N.J. Super. 96 (Ch. Div. 1997), the judge concluded that "[p]laintiff did exactly what our case law provides he cannot do -- he insulated his assets from the alimony calculus by investing those assets in a non-incoming producing manner." The judge was also unconvinced that plaintiff continued to actively pursue other employment, noting "his most recent job search letter was sent in July 2007."
Plaintiff moved for reconsideration on July 31 and again sought oral argument. After noting that his current monthly alimony obligations were $9600 ($8000 $1600 arrears per month), plaintiff reiterated the financial circumstances regarding his "income and earnings history." He argued that the judge had failed to analyze in any detail "the sum total of his assets." Plaintiff contended that any imputation of income available to supplement his significant decrease in earnings should be limited to only certain assets. As a result, plaintiff argued that only $41,175 of additional income per year was available to meet his alimony obligations, making the total available income $173,495, an amount that was forty-five percent less than his income at the time of his divorce. Lastly, plaintiff argued that his decision to use his inheritance and other assets to pay down his mortgage was wise given his unemployed status at the time; additionally, he provided further proof of his fruitless search for an executive position.
Once again, defendant opposed the motion and cross-moved to enforce litigant's rights. She noted that plaintiff's alimony arrearages were $146,000 as of September, and that her continuous need to respond to plaintiff's motions had caused her to incur yet additional legal fees.
Plaintiff filed another reply certification, much of which re-iterated his initial assertions. He advised for the first time, however, that Pennsylvania had commenced enforcement actions against him, and, as a result, he faced incarceration if he failed to pay $15,000 immediately ...