July 15, 2010
NELLY MARQUEZ, PLAINTIFF-RESPONDENT,
MARCELO GABRIEL CABRERA, DEFENDANT-APPELLANT.
On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Hudson County, Docket No. FM-09-375-09.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued May 12, 2010
Before Judges Fisher and Sapp-Peterson.
In this appeal, defendant, Marcelo Gabriel Cabrera (Cabrera), seeks reversal of the Family Part order denying his motion for relief from judgment pursuant to Rule 4:50-1 based upon his claim that the property settlement agreement (PSA) incorporated into the final judgment of divorce (FJOD) was procured by fraud. Because we conclude that there were genuinely disputed factual issues raised by the parties' certifications and other documentary evidence, we reverse and remand for a hearing.
Cabrera and plaintiff, Nelly Marquez (Marquez), were married on August 26, 2003. During the marriage, the couple owned two principal assets: a co-op in North Bergen, New Jersey (the North Bergen co-op) and a condominium in Argentina (the Argentina condominium). Marquez had acquired the North Bergen co-op prior to the marriage, and the title and mortgage were in her name only. The couple purchased the Argentina condominium as an investment property during the marriage. It was purchased for $50,000, using a loan from Cabrera's credit union which Marquez allegedly co-signed.
Marquez filed for divorce on July 17, 2008. Cabrera never responded to the complaint, and default was entered against him on April 13, 2009.*fn1 Following the entry of default, plaintiff served defendant with a notice of motion for proposed equitable distribution and final judgment in accordance with the provisions of Rule 5:5-10. According to Marquez, on June 18, 2009, the couple executed their PSA. The PSA provided that Marquez would receive the North Bergen co-op and the Argentina condominium "with no [b]uy-out to the [h]usband." She would also be "solely responsible for the mortgage payments" on the North Bergen co-op, although Cabrera would be required to "[pay off] the said [$50,000] personal loan [from the credit union], within forty-five (45) days from the date this Agreement is signed."
The court conducted a proof hearing on June 30, 2009, at which Cabrera made no appearance. At its conclusion, the court entered the FJOD and incorporated the PSA into the order. According to Cabrera, he received a copy of the FJOD on August 12, 2009, and filed a motion seeking relief from the judgment the following month.
In his certification submitted in support of his motion, Cabrera acknowledged that he signed a PSA on June 18, but claimed that he did not sign the version submitted to the court that was later incorporated into the FJOD. He indicated further that the PSA he signed would have allowed him to keep the Argentina condominium, provided he paid off the $50,000 credit union loan within two years of the contract date.*fn2 Cabrera accused Marquez of removing the signature page from the PSA he signed and appending it to the PSA she ultimately submitted to the court. He also pointed out to the court "that there is no Certification from the Notary that he witnessed my signature. In addition, the last two pages of the purported Agreement are both numbered as Page 7."
Marquez opposed the motion and also filed a cross-motion seeking the entry of judgment in the amount of $5332.71 against Cabrera representing a debt he incurred with the United Nations for which she was also being held responsible. In her certification in opposition to Cabrera's motion and in support of her cross-motion, Marquez concedes she was initially open to the idea of Cabrera keeping the Argentina condominium. She explained that she changed her position when Cabrera began missing payments on the credit union loan, causing funds to be deducted from her personal bank account. Once Cabrera stopped making the loan payments, she believed "it would not be just for me to solely pay for the line [of] credit and the Defendant to keep the property in Argentina." She contends that she discussed the matter with Cabrera, who in turn, via email, agreed that she should retain the Argentina property.
Cabrera requested oral argument only if there was opposition to his motion, while Marquez requested oral argument "as to all issues" raised in her papers. On October 1, 2009, the return date of the motion, prior to rendering an oral decision, the court asked the attorneys if there was anything they wanted to add. Both attorneys declined the offer. The court then placed its decision on the record. Beginning with Cabrera's fraud claim, the court found "there is no proof before the [c]court that he did not sign the document and was not aware of it. . . . All of the documents that have been produced lead me to believe that Ms. [Marquez] . . . is giving me a correct statement." Regarding Marquez's claim for $5332.71, the court held that "[h]e also needs to reimburse the sum of $5332.71 for the lack of dependency allowance because he did not file the appropriate documents."*fn3 Finally, regarding Marquez's claim for attorney's fees, the court concluded: "I would also . . . allow Ms. Marquez to receive attorney's fees [because] Mr. Cabrera's veracity is questionable regarding this motion. I see nothing that leads me to believe that his version of the events is the correct version." The ensuing appeal followed.
On appeal, Cabrera raises the following points for our consideration:
THE ORDER BELOW SHOULD BE REVERSED BECAUSE DEFENDANT ESTABLISHED A PRIMA FACIE CASE ENTITLING HIM TO A HEARING FOR THE RELIEF HE SOUGHT.
THE COURT BELOW ERRED IN MODIFYING THE PSA TO REQUIRE DEFENDANT TO PAY THE DEBT TO THE UNITED NATIONS WHEN SUCH DEBT WAS NOT LISTED ON PLAINTIFF'S NOTICE OF EQUITABLE DISTRIBUTION AND PLAINTIFF DID NOT ESTABLISH ANY BASIS FOR SUCH MODIFICATION UNDER [RULE] 4:50-1.
THE COURT BELOW ERRED IN AWARDING PLAINTIFF COUNSEL FEES WITHOUT REQUIRING A CERTIFICATION OF COUNSEL AND WITHOUT EXAMINATION OF THE REQUIRED FACTORS.
On appeal, we review a trial court's order denying relief from judgment in accordance with our abuse of discretion standard of review. Hous. Auth. of Morristown v. Little, 135 N.J. 274, 283 (1994). "A motion under Rule 4:50-1 is addressed to the sound discretion of the trial court, which should be guided by equitable principles in determining whether relief should be granted or denied[,]" and "[t]he decision granting or denying an application to open a judgment will be left undisturbed unless it represents a clear abuse of discretion." Ibid.
Rule 4:50-1 provides that "[o]n 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 . . . (c) fraud[.]" Moreover, where the basis for the relief sought is premised upon a claim of fraud, the party objecting to the judgment must establish the fraud by clear and convincing evidence, demonstrating that "a material misrepresentation [was] made with intent that it be relied on, coupled with actual detrimental reliance." Nolan v. Lee Ho, 120 N.J. 465, 472 (1990)
Additionally, where the nature of the relief sought is to set aside or modify a divorce judgment, a trial judge should ordinarily conduct a plenary hearing and take oral testimony if genuinely disputed factual issues are raised by the parties' affidavits. Tancredi v. Tancredi, 101 N.J. Super. 259, 262 (App. Div. 1968). "'Only by such procedure can a court make certain that it has fully explored the issue and correctly adjudged it.'" Ibid. (quoting First Nat'l Bank of Freehold v. Viviani, 60 N.J. Super. 221, 225 (App. Div. 1960)).
A plenary hearing, however, is not mandated in every case where there are competing affidavits. Shaw v. Shaw, 138 N.J. Super. 436, 440 (App. Div. 1976). "It is only where the affidavits show that there is a genuine issue as to a material fact, and that the trial judge determines that a plenary hearing would be helpful in deciding such factual issues, that a plenary hearing is required." Ibid. Indeed, if hearings were required in every case, it "would impede the sound administration of justice, impose an intolerable burden upon our trial judges, and place an undue financial burden upon the litigants." Ibid. Thus, "[w]hile it is axiomatic that all material factual disputes must be resolved on testimony, the [party seeking relief from a judgment] nevertheless has the threshold burden to establish a prima facie case to obtain a hearing on a motion for relief from the terms of an agreement." Dworkin v. Dworkin, 217 N.J. Super. 518, 525 (App. Div. 1987) (internal citations omitted).
Here, Cabrera not only vehemently denied that he signed the PSA incorporated into the FJOD but produced documentary evidence in the form of two pages numbered "7," which happen to be signature pages, to support his contention that the signature page he executed was removed from the version of the PSA he actually signed and then appended to another PSA that was presented to the court. We also observe that the PSA is obviously one-sided in favor of Marquez, allowing her to have sole ownership of the two major assets of the marriage, but holding Cabrera personally liable for the debt incurred to secure one of the properties.
In rejecting Cabrera's claim, the trial court placed considerable weight upon the fact that the PSA was executed before a notary who Cabrera failed to produce:
Now he says I never signed that document, I never -- I don't know who that person was who notarized my signature, but oddly enough, he doesn't call the gentleman into question. He doesn't bring Mr. Silva before the [c]court, doesn't notice him, doesn't serve a subpoena upon him, doesn't say a thing, just states I did not sign it.
While Cabrera was not precluded by any court rule from attempting to secure an affidavit from the notary in support of his contention that he did not sign the document, the failure to do so at this stage of the proceeding should not have been dispositive. If, as Cabrera claims, the PSA incorporated in the FJOD was fraudulently procured, the notary may not have voluntarily cooperated with Cabrera in submitting an affidavit supporting Cabrera's claims. And, contrary to the trial court's holding, Cabrera was not entitled to subpoena the notary until such time as a plenary hearing was ordered. Welch v. Welch, 401 N.J. Super. 438 (Ch. Div. 2008). Hence, the court accorded too much weight to the lack of a sworn statement from the notary and insufficient weight to the questionable signature page which Marquez, in her thirty-eight-paragraph certification in opposition to Cabrera's motion, made no attempt to explain.
Likewise, the emails referenced in Marquez's certification, purportedly from Cabrera's sister, were hearsay and not competent evidence the court should have considered for purposes of determining whether Cabrera had established a prima facie case of fraud sufficient to warrant a plenary hearing. Rule 1:6-6 provides:
If a motion is based on facts not appearing of record, or not judicially noticeable, the court may hear it on affidavits made on personal knowledge, setting forth only facts which are admissible in evidence to which the affiant is competent to testify and which may have annexed thereto certified copies of all papers or parts thereof referred to therein. The court may direct the affiant to submit to cross-examination, or hear the matter wholly or partly on oral testimony or depositions.
In short, we are satisfied that the affidavits of Cabrera and Marquez established genuinely disputed issues of material fact sufficient to warrant a plenary hearing as to Cabrera's claim of fraud and the trial court mistakenly exercised its discretion in resolving the disputed issues solely upon the papers.
For these same reasons, the award in favor of Marquez in the amount of $5332.71 must also be set aside. Marquez's cross-motion in this regard could not be resolved without a plenary hearing.
In summary, we vacate the denial of Cabrera's motion for relief from judgment and the award of the $5332.71 judgment in favor of Marquez and remand for a plenary hearing.
In view of our decision, we also vacate the award of counsel fees in favor of Marquez. Further, because the motion judge made credibility determinations and "may have a commitment to [her] findings," the plenary hearing must be conducted before a different judge. Carmichael v. Bryan, 310 N.J. Super. 34, 49 (App. Div. 1998).
The October 9, 2009 order of the Family Part is vacated and the matter remanded for a plenary hearing consistent with this opinion. We do not retain jurisdiction.