August 25, 2010
JOSE SANTISO, PLAINTIFF-APPELLANT/ CROSS-RESPONDENT,
GLORIA SANTISO, DEFENDANT-RESPONDENT/CROSS APPELLANT.
On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Morris County, Docket No. FM-14-747-06.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted August 17, 2010
Before Judges Sabatino and Ashrafi.
This matter involves numerous post-judgment disputes between former spouses. After reviewing competing motions filed by the parties, the Family Part entered two companion orders on August 4, 2009, granting and denying relief in various respects.
Plaintiff Jose Santiso ("the ex-husband") appeals certain aspects of those orders, and defendant Gloria Santiso ("the ex-wife") appeals other aspects of the orders.
The parties were divorced in September 2007, and concurrently entered into a Property Settlement Agreement ("PSA") that was incorporated into their final judgment of divorce. Among other things, the PSA provided for limited-duration alimony to be paid by the ex-husband to the ex-wife through the Probation Department. The PSA also addressed issues of equitable distribution, including provisions that directed the ex-husband to pay the ex-wife $597,000 for her marital interest in certain business ventures.
The PSA also contained extensive terms with respect to a residence in New Jersey and a second residence in Florida, both of which the spouses jointly owned. The PSA called for the prospective sale of both the New Jersey residence, where the ex-husband was living at the time of the divorce, and the Florida residence, where the ex-wife was living.
Among other things, the PSA specified that the ex-husband would be repaid for "any necessary costs related to the closing" in connection with the sale of the New Jersey residence, as well as "100% of any structural repairs agreed to by the parties and paid by the [ex-h]usband." As to the Florida property, the PSA specified that the ex-husband would pay the mortgage on that property until it was sold. Meanwhile, the ex-wife "agree[d] to pay the real estate taxes in 2008, if the property is not sold before 2008[.]" The parties also agreed in the PSA to equally bear, after June 2007, the condominium fees and dues for the Florida residence until it was sold.
The New Jersey residence was sold in September 2008. According to the ex-husband, he advanced the costs of several items in connection with that sale, including the real estate transfer tax and monies spent on certain structural repairs. The ex-husband alleges that his former spouse did not reimburse him for those costs, despite the terms of the PSA.
It appears from the record that the ex-wife acknowledges her obligation to bear the costs of the real estate transfer tax. However, she disputes the ex-husband's other claims for reimbursement relating to the New Jersey property, arguing that the items are not adequately documented, and, as to the alleged structural repairs, not shown to have been reasonable and necessary. The ex-wife also contends that she was not given proper advance notice of the structural repairs on the New Jersey property before they were made.
Meanwhile, the Florida property was listed on the market but remained unsold. According to the ex-husband, the ex-wife failed to pay the real estate taxes on that property in 2008, or, for that matter, in 2009. Consequently, the mortgagee for the Florida property, Merrill Lynch, paid the real estate taxes and made a corresponding upward adjustment to the ex-husband's monthly mortgage payment. The ex-husband contends that the ex-wife has refused to reimburse him for these sums, or to allow him to take a corresponding credit against his alimony obligation. The ex-husband also contends that the ex-wife has unreasonably delayed and obstructed the sale of the Florida residence, causing a loss of value in a declining real estate market.
For her own part, the ex-wife contends that the ex-husband has been substantially delinquent in his obligations to pay her alimony and certain equitable distribution payments. She opposes any credits or offsets against the alimony that is due to her.
In March 2009, the ex-husband filed a motion with the Family Part seeking relief in aid of litigants rights. Among other things, the ex-husband sought credits against his alimony obligations for the Florida real estate taxes, the unreimbursed New Jersey closing costs, and other sums that were allegedly the responsibility of his former spouse. The ex-husband also sought counsel fees.
The ex-wife filed a detailed certification contesting the ex-husband's motion. She disputed several of his factual assertions, including assertions that he had made certain alimony payments and that he was due certain credits. The ex-wife also filed a cross-motion in aid of litigants rights, demanding seventeen enumerated items of relief. Among other things, the ex-wife sought immediate payment of $25,000 in alimony arrears; $85,841.57 in equitable distribution due, plus interest; denial of credits on the New Jersey property sale; a self-executing warrant for the ex-husband's arrest; and counsel fees.
Both the ex-husband and the ex-wife specifically requested oral argument on their competing motions. Nevertheless, the Family Part did not conduct oral argument, and instead decided the motions on the basis of the written submissions.
The court issued the two aforesaid orders dated August 4, 2009, along with a two-page written statement of reasons. The court granted the ex-husband an agreed-upon $7888.81 credit*fn1 for alimony he paid and another credit of $444.52. The court also declared the ex-wife in violation of litigants rights as to the non-payment of real estate taxes on the Florida property, and directed her to bring the 2008 and the first quarter 2009 real estate taxes current. The court denied the ex-husband counsel fees and the other relief he had requested. As for the exwife's cross-motion, the court ordered the ex-husband to pay her $25,000 in alimony arrears and $85,841.57 in unpaid equitable distribution, plus interest. The court also declared that the ex-husband was not entitled to a $10,872.63 credit for costs associated with the New Jersey closing, and directed him to pay the balance he owed to the ex-wife from that sale. The court denied other relief to the ex-wife, including her own demand for counsel fees.
In his appeal, the ex-husband argues that the Family Part erred in deciding the motions without oral argument and without a plenary hearing to resolve the factual disputes raised by the parties' conflicting certifications. He also asserts that the court improperly denied him a credit against alimony for the unreimbursed New Jersey real estate transfer tax, and for other expenses he paid in connection with the New Jersey sale. As to the Florida property, the ex-husband argues that the trial court should have allowed him to offset his alimony obligations by the sums he has paid, either directly or through the increased mortgage, for the Florida realty taxes.
The ex-wife cross-appeals. She argues that the trial court erred in declaring her in violation of litigants rights because of her failures to pay the Florida realty taxes and other obligations. She asserts that such failures were directly attributable to, and excused by, the ex-husband's own failure to timely pay her what he owed in alimony and equitable distribution installments. She further argues that the trial court should have held the ex-husband in violation of litigants rights because of his allegedly "blatant refusal" to comply with the PSA. The ex-wife further maintains that the trial court should have awarded her sanctions and counsel fees.
Having considered, in light of the applicable law, the parties' competing arguments and the various documents in the record, we are satisfied that this matter must be remanded to the trial court for oral argument and for a plenary hearing on the disputed factual issues.
The denial of oral argument was in error. Although we appreciate that the issues raised by the parties' motions were predominantly financial in nature and did not involve more subjective or dynamic issues such as child custody, the trial court was nevertheless obligated to afford both counsel, as they had mutually requested, a chance to advocate their respective points in court. The motions were substantive in nature, and did not concern matters of calendaring or routine discovery applications. See R. 5:5-4(a); see also Mackowski v. Mackowski, 317 N.J. Super. 8, 14 (App. Div. 1998).
This is not the rare case where oral argument on substantive issues would have been "unnecessary and unproductive." Cf. Palombi v. Palombi, ____ N.J. Super. ____, ____, (App. Div. 2010) (slip. op. at 12-15) (holding that oral argument on post-judgment motions was not required where the motions failed to present substantive issues in a proper manner for the court's determination, and where, in light of those manifest deficiencies, such argument would have been unproductive and unnecessary). Indeed, the fact that both parties here obtained a measure of success on their respective motions is indicative that their motions were not groundless or hopelessly plagued with procedural deficiencies. It may well be that the court would have reached exactly the same outcome if counsel had been allowed to voice their positions in open court. Even so, it would have been preferable to grant that live opportunity as a matter of process.
We also are satisfied that the disputed factual issues of offset and reimbursement--particularly concerning the New Jersey closing and pre-closing costs--warranted a plenary hearing, with testimony from the parties and any other relevant witnesses and appropriate credibility findings by the court. For example, the ex-wife contended that she was not told in advance about the structural repairs needed for the New Jersey house and that the repairs that were undertaken by the ex-husband were unnecessary and too expensive. The ex-husband certified to the contrary. That factual disagreement, and others like it, should have been explored at a plenary hearing, at which the parties could be examined and cross-examined. See Conforti v. Guliadis, 128 N.J. 318, 322 (1992)(requiring plenary hearings to resolve material factual disputes); see also Palko v. Palko, 150 N.J. Super. 255 (App. Div. 1976), rev'd on dissenting opinion, 73 N.J. 395 (1977); Barrie v. Barrie, 154 N.J. Super. 301, 303 (App. Div. 1977), certif. denied, 75 N.J. 601 (1978). In such a proceeding, the court will have a chance to assess the credibility of each movant's assertions, as tested through the rigors of cross-examination. Eaton v. Grau, 368 N.J. Super. 215, 222 (App. Div. 2004). Consequently, a remand for a plenary hearing is necessary.
With respect to the ex-husband's claim that any credits to which he can demonstrate entitlement should be offset from his alimony obligations, we defer to the trial court's discretion in granting or denying that particular relief on remand. Depending upon the parties' relative current financial and cash flow positions, it may be more equitable to offset those credits against any remaining equitable distribution that may be due to the ex-wife, or to treat those offsetting sums as an adjustment at an eventual closing on the Florida property, rather than to deduct those sums from alimony, which the ex-wife may need for her day-to-day living expenses. The trial court shall have the discretion to consider the relative equities, based upon an updated record with mutual financial disclosures, and to fashion appropriate relief in the remand proceeding.
We discern no merit in the ex-wife's cross-appeal. The denial of counsel fees to her was well within the court's discretion under Rule 5:3-5, and the denial of other sanctions was likewise not a misapplication of discretion. However, the ex-wife is not foreclosed from renewing before the trial court a demand for sanctions based on the record as it is further developed in the remand proceedings, or for additional counsel fees incurred on the remand.*fn2
Affirmed in part, and remanded in part. We do not retain jurisdiction.