April 29, 2010
LORRAINE MALANDRUCCOLO, A/K/A LORRAINE SACHS, PLAINTIFF-APPELLANT,
MICHAEL MALANDRUCCOLO, DEFENDANT-RESPONDENT.
On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Bergen County, Docket No. FM-02-1884-00.
The opinion of the court was delivered by: R. B. Coleman, J.A.D.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted February 23, 2009
Before Judges R. B. Coleman and Simonelli.
Plaintiff Lorraine Malandruccolo, pro se, appeals from a post-divorce order dated March 14, 2008, that decided monetary issues that were disputed between plaintiff and her ex-husband, defendant Michael Malandruccolo. Among other things, the order (1) denied plaintiff's request for reimbursement of a bill for braces for the parties' daughter; and (2) granted in part and denied in part plaintiff's request for reimbursement of college expenses. The order directed reimbursement of $1,000 for the January 2006 semester's college expenses for the oldest son, but it denied, without prejudice, plaintiff's request for future contributions of college expenses for both sons.*fn1
On the return date of the motion, the judge announced his determination that $1,000 was owed by defendant under the Consent Order of November 7, 2005, but he reserved decision on whether defendant was entitled to a credit because of social security payments made to the minor which were in excess of the sum defendant would have been required to pay according to the child support guidelines. The judge issued a supplemental opinion, dated March 14, 2008, in which he concluded that "any credit regarding child support [to which defendant might be entitled] would, in fact refer to child support and not any other obligations such as medical and/or college." Defendant did not cross-appeal that determination. For the reasons that follow, we remand for an amplification of the court's reasons for denying reimbursement of the orthodontic charges, and although we affirm the award of the $1,000 agreed upon by the parties, without prejudice, for the 2005-2006 semesters, we direct that a plenary hearing be conducted for the remaining semesters if the dispute cannot be resolved by and between the parties.
At the outset, we noted that the record of this case discloses an early determination by the judge who first presided over the divorce proceedings that a plenary hearing was needed to resolve economic issues between the parties and to determine defendant's ability to pay child support and to contribute to other expenses, including the college education of the three children born to the marriage. The Inter-spousal Agreement incorporated into the Amended Final Judgment of Divorce, entered on July 27, 2001, provided that the parties would "pay to the best of [their] respective ability all post secondary education costs for the [c]hildren, including, but not limited to, tuition and room and board." The Inter-spousal Agreement also stated that "[a]ll unreimbursed health insurance costs, including but not limited to medical, dental, psychological, optometric and orthodontic costs for the [c]hildren shall be shared equally between the parties."
The issue of orthodontic costs was the subject of an order of the court entered on July 27, 2005. At that time, the court ordered defendant to pay one half of the costs of braces for the parties' daughter. That order set forth a schedule for payments of the sums representing defendant's one half share and ordered that defendant pay the specified sums directly to Dr. Gwen S. Cohen, D.D.S. Defendant failed to make those payments and instead he filed a petition for bankruptcy under Chapter VII, listed Dr. Cohen as a creditor and purported to discharge, pursuant to 11 U.S.C.A. § 727(b), the debt to her for his daughter's orthodontic work.
The exceptions to dischargeable debts are contained in Sections 5 and 15 of 11 U.S.C.A. 523(a). Those exceptions are characterized as any debt:
(5) for a domestic support obligation; . . . .
(15) to a spouse, former spouse or child of the debtor and not of the kind described in paragraph (5) that is incurred by the debtor in the course of a divorce or separation or in connection with a separation agreement, divorce decree or other order of a court of record, or a determination made in accordance with State or territorial law by a government unit.
Notwithstanding that each of the parties was to pay his or her half of the debt, plaintiff paid Dr. Cohen's entire bill and appeals herein the denial of her motion for reimbursement of defendant's one half. It is not clear from the record when those payments were made by plaintiff or what she knew at the time.
"Alimony and support obligations may not be discharged in bankruptcy." Schorr v. Schorr, 341 N.J. Super. 132, 137 (App. Div. 2001). "In making its determination the courts are not bound by the label which the parties ascribe to any provision in the agreement." Ibid. As explained in Schorr, supra:
In order to ascertain the parties' intent at the time of the settlement, the court must analyze the following three principle factors:
1) the language and substance of the agreement in the context of surrounding circumstances, using extrinsic evidence if necessary;
2) the parties' financial circumstances at the time of the settlement; and
3) the function served by the obligation at the time of the divorce or settlement. [341 N.J. Super. at 137-38 (quoting Gianakas v. Gianakas, 917 F.2d 759, 762 (3d Cir. 1990)).]
These same factors are relevant to the purpose and intent of the court's order allowing or directing that payments be made to a third-party provider who was not a party to the divorce proceeding in which the court's order was entered.
Plaintiff takes the position in her appellate brief that she had no knowledge of defendant's 2005 bankruptcy until defendant filed his certification dated February 13, 2008, in response to plaintiff's motion. Plaintiff argues that sums owed by defendant are not discharged by bankruptcy as they are in the nature of child support. Plaintiff also contends that defendant was not candid with the court and, thus, the order directing defendant to pay the doctor directly rather than to pay through the probation department or to reimburse plaintiff should be unenforceable. Cf. In re Forrest, 158 N.J. 428, 435 (1999) (noting that to withhold material information can prevent an arbitrator or a court from properly discharging its responsibilities).
Defendant contends his obligation was not to plaintiff, but rather that he was indebted directly to the doctor. He argues further that since the doctor was a third party to the marriage arrangement, the debt was properly dischargeable in bankruptcy. The validity of those arguments may, of course, rest upon an assessment of whether the court and defendant's adversary were not deceived into taking a position they would not have taken were the true facts known.
At oral argument on plaintiff's motion concerning reimbursement of college expenses, both parties asserted that a plenary hearing was needed to determine defendant's ability to pay and the appropriate amount of such expenses. Counsel for defendant explained to the judge that there had been many discussions about a plenary hearing, but the plenary hearing "kept getting postponed." Counsel then suggested "[t]his case cries out for a plenary hearing. That was [the original judge's] intent in the Orders that were entered more than two years ago. And it was up to this particular Plaintiff to come before the Court and ask for a plenary hearing. That was never done." When the court asked plaintiff why she had not moved for a plenary hearing on the matter, plaintiff responded: "I never knew I had to put forth a request for it. I thought it was automatically done. . . . I didn't know I had to do that."
Because plaintiff's motion had not specifically requested that the court decide future college expenses and defendant's ability to pay, the court confined its decision to the enforcement of the Consent Order. That order reflected only the parties' provisional agreement that defendant would pay $1,000, for the 2005-2006 semesters, without prejudice to either party's position as to what is truly the fair and reasonable amount. The judge aptly observed that "[t]here is nothing in this order which says he is to pay $1,000 per semester until [the older son is] out of college." Ultimately, the judge told plaintiff, "I cannot rule on -- with what you've given me, I cannot rule on any future expenses regarding college."
While the judge was accurate in his observations and he regarded himself technically limited by the scope of the notice of motion, both parties were urging a more comprehensive resolution of an issue that had been looming since the Inter-spousal Agreement was incorporated into the Judgment of Divorce in 2001. Under such circumstances, Rule 1:1-2 provides ample authority for the court to proceed in a manner compatible with the purpose of "secur[ing] a just determination, simplicity in procedure, fairness in administration and the elimination of unjustifiable expense and delay." The core issue should be addressed and decided. We do not express any view on the outcome of a plenary hearing, but we have no hesitation in directing that such hearing be convened in order that defendant's obligations for college expenses and his ability to pay can be appropriately defined.
Because the motion judge did not elaborate on his reasons for denying plaintiff reimbursement, we remand for a clear expression of his reasons for denying reimbursement. In light of the longstanding disagreement on the issues related to defendant's ability to pay college expenses and the amounts, if any, to be paid, we direct that a plenary hearing be convened, unless the issues can be resolved by agreement between the parties. We do not retain jurisdiction.