May 13, 2010
HIDESHI KUDO, PLAINTIFF-RESPONDENT,
JODY KUDO, DEFENDANT-APPELLANT.
On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Ocean County, Docket No. FM-15-568-07.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued April 14, 2010
Before Judges Sabatino and J. N. Harris.
Defendant appeals from an order of August 7, 2009, denying her motion to vacate a final default judgment of divorce. After a thorough review of the record and of the Family Part's findings, we affirm.
Plaintiff Hideshi Kudo and defendant Jody Kudo were married on March 6, 1993. During the marriage, plaintiff was employed as a manager by Mr. Good Lube, Inc., earning approximately $95,000 per year. Defendant worked from home after having earned a Bachelors Degree and Masters of Science Degree. She spent her time investing and selling several investment properties located in New Jersey and Florida.
In January 2006, plaintiff commenced divorce proceedings in the Monmouth vicinage, but venue was ultimately transferred to the Ocean vicinage. The primary investment property at issue in this case is located in Point Pleasant, Ocean County. This property had originally been purchased in June 1994 by defendant and her father, Joseph Skerbe. During the course of the marriage, the Point Pleasant property was initially held in a joint tenancy, but in 1996 title to the real property was transferred to defendant alone. This title remained solely in defendant for eleven years until March 2007, at which time defendant unsuccessfully attempted to re-convey the property to her father.
Defendant was personally served with the complaint for divorce on February 28, 2006. For reasons that still remain unclear and unexplained by defendant, she failed to respond or otherwise plead in a timely manner, resulting in the first default being entered against defendant. Defendant filed an application by order to show cause to vacate the default, which was granted. An answer and a counterclaim were finally filed on August 16, 2006.
On September 29, 2006, the Family Part entered a case management order requiring defendant to complete real estate appraisals on all of the investment properties by October 31, 2006, including the Point Pleasant property. These were never completed or provided, forcing the court to issue a follow-up case management order mandating that expert appraisals now be completed by April 15, 2007.
Throughout the litigation, despite being represented by four different attorneys at various times, defendant routinely failed to respond to numerous discovery obligations. As a result, the court in an order dated May 25, 2007, compelled defendant to "provide new and fully certified answers to interrogatories and response[s] to [a] notice to produce" by June 19, 2007. A subsequent order from the Family Part on June 26, 2007 required defendant to "certify her answers to [i]nterrogatories within [seven] days or her ans[wer] and [counterclaim] will be dismissed and default entered."
The trial was scheduled for September 2007. However, instead of the intended trial being conducted, additional delays occurred due to further discovery delinquencies by defendant. For example, in August 2007, defendant again failed to reply to inquiries regarding the necessary appraisals of the investment properties in her name.
The parties subsequently submitted to an Early Settlement Panel, but were unsuccessful in their efforts to amicably adjust the dispute. Thereafter, on November 9, 2007, the Family Part issued an order granting plaintiff access to the investment properties within ten days of the entry of the order, so that the property values could be assessed for the purposes of equitable distribution. The order explicitly stated that "[i]n the event defendant fails to comply with the [obligation to provide access], defendant's pleadings shall be stricken and her defenses suppressed, upon ex-parte application of the plaintiff." Defendant received notice of this order, but again failed to coordinate with plaintiff's attorney to arrange for the necessary inspections of the properties.
Instead of proceeding ex-parte when confronted with defendant's renewed refusal to cooperate, plaintiff filed a motion--on proper notice to defendant--to strike defendant's answer, suppress her defenses, and dismiss the counterclaim. The trial court granted plaintiff's motion and promptly scheduled "an uncontested default hearing and trial."
The trial spanned six non-successive days, commencing on February 21, 2008. Notwithstanding being aware of the matter during the entire course of the proceedings, defendant at times showed up hours late to the trial, and sometimes failed to appear at all. As a result, despite rescheduling and postponing court events in an effort to accommodate defendant's schedule, the court denied defendant's mid-trial motion to vacate the default.
After an amended final default judgment of divorce was entered on August 13, 2008, the court also ordered the sale of the Point Pleasant property--deeming it marital property--from which plaintiff was to receive his equitable share. Defendant made numerous efforts to block the listing and sale of this property, forcing the court on January 9, 2009, to declare defendant in violation of litigant's rights and granting plaintiff and his real estate brokers unlimited access to the property for the purposes of its sale.
In response, defendant filed a motion (1) to vacate the final default judgment of divorce and (2) to stay the sale of the Point Pleasant property. These post-trial motions were denied by the Family Part on August 7, 2009. On August 26, 2009, defendant filed a notice of appeal and shortly thereafter, on September 2, 2009, defendant filed a motion with this court to stay the sale of marital property. We denied this application for a stay on September 30, 2009.
Rule 4:50-1 is germane to motions to vacate judgments in the Family Part. Eaton v. Grau, 368 N.J. Super. 215, 222 (App. Div. 2004). On appeal, a decision pursuant to that rule is restricted by the abuse of discretion standard of review. Hous. Auth. of Morristown v. Little, 135 N.J. 274, 283-84 (1994); Del Vecchio v. Hemberger, 388 N.J. Super. 179, 186-87 (App. Div. 2006).
This rule should be used sparingly in the re-examination of judgments of the court. Such judgments will not be disturbed by us absent an abuse of discretion, Hous. Auth., supra, 135 N.J. at 283-84; Hodgson v. Applegate, 31 N.J. 29, 37 (1959). Alternatively, motions to vacate default judgments, as opposed to judgments entered after the conclusion of contested litigation, are "viewed with great liberality, and every reasonable ground for indulgence is tolerated to the end that a just result is reached[,]" Marder v. Realty Const. Co., 84 N.J. Super. 313, 319 (App. Div.), aff'd, 43 N.J. 508 (1964). This court will not disturb a default judgment unless the failure to answer or otherwise appear and defend oneself against the claims is excusable under the circumstances. Fineberg v. Fineberg, 309 N.J. Super. 205, 215 (App. Div. 1998) (citing Marder, supra, 84 N.J. Super. at 318-19).
It is noteworthy that the order of the Family Part entering default in this case was issued in response to several months of discovery delinquencies and delays. The key event was the order dated January 7, 2008, which was bottomed upon Rule 4:23-2, entering default due to defendant's failure to comply with the earlier order dated November 9, 2007. That November order required defendant to cooperate in making certain real property available for inspection and appraisal. This aspect of discovery was essential--not ministerial--because of the implications of the properties' valuations for admeasuring equitable distribution.
We do not have the same first-hand feel of the case as did the judge in the Family Part, but our independent review of the record confirms an unjustified recalcitrance on the part of defendant in participating in critical aspects of the litigation. The judge's deployment of Rule 4:23-2, coupled with plaintiff's use of a motion instead of proceeding ex-parte as the January 7, 2008 order permitted, allowed for a sufficient stop, look, and listen by the Family Part; this patience belies defendant's claims of impetuous actions on the part of the trial judge.
After a pragmatic assessment of what occurred in the Family Part for such a lengthy period, it is clear to us that based upon the conduct of defendant throughout the litigation, she did not demonstrate good cause or excusable neglect to justify a court setting aside the final default judgment of divorce. O'Connor v. Altus, 67 N.J. 106, 129 (1975).
Two defaults were entered against defendant during the course of this litigation; she failed to oppose motions submitted by plaintiff; she failed to appear in court or would repeatedly turn up tardy when she did attend proceedings; and she additionally failed to cooperate with the absolutely essential appraisal process for the investment properties. Although the spectrum of coercive incentives provides many alternatives to Family Part judges who must manage the type of dilatory conduct witnessed in this case, we cannot say that the trial judge abused his discretion in refusing to undo the final default judgment of divorce.
Defendant now attributes her lack of cooperation on the fact that the motions were sent to an address at which she no longer resided, but the record lacks any supporting documentation to show that she duly informed the court of her allegedly temporary change of address. As this court has previously found, a litigant "ha[s] an obligation to keep the court and counsel aware of his [or her] whereabouts," cf. In re Nackson, 221 N.J. Super. 187, 198 (App. Div. 1987), aff'd, 114 N.J. 527 (1989).
Defendant also partially attributes her lack of cooperation on her "series of illnesses and circumstances that establish good cause for the delay and length of the proceedings . . . and should have caused the court to provide [defendant] with additional time and consideration." However, defendant did not present any competent medical evidence or expert opinions to either confirm the existence of medical issues or provide an explanation of how they prevented her from promptly complying with court orders or from attending court proceedings. Indubitably, Rule 4:50-1 "requires that courts be indulgent of litigants who deserve such indulgences[,]" Fineberg, supra, 309 N.J. Super. at 217. Nevertheless, the record amply supports the trial court's determination that defendant's unexplained and persistent conduct did not deserve such indulgence.
In our view, the most troublesome actions by defendant were her blatant failures to cooperate with the orders lawfully entered against her by the Family Part, specifically with respect to the valuation of the investment properties. Because defendant failed to provide property values or to participate cooperatively in the litigation, the judgment of divorce entered by the court was equitable, despite the fact that defendant was not awarded alimony, as she never made a bona fide claim for such relief during the entire course of the litigation.
After witnessing a significant portion of the parties' litigational encounters, the Family Part found that defendant "has steadfastly done everything within her power to slow down the process to make it more difficult, to create every complexity or every difficulty in having the court proceed in this matter that has been within her power to do so[;] . . .
[t]here has been no good faith exhibited by Ms. Kudo throughout these proceedings." Based upon that factual finding, which warrants our deference, we determine that the Family Part did not abuse its discretion in denying the motion to vacate the final default judgment of divorce.
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