On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Union County, Docket No. FM-20-0979-03G.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted September 13, 2010
Before Judges Sabatino and Alvarez.
This is an ongoing post-judgment matrimonial dispute involving appellant David O. Hopkins ("the ex-husband") and respondent Yvonne A. Hopkins ("the ex-wife"). Following a trial in the Family Part and related proceedings in the United States Bankruptcy Court and the United States District Court, the parties were divorced in November 2006. The Family Part awarded $500 per week in permanent alimony to the ex-wife, who is a full-time caretaker of the parties' disabled adult son. The court further awarded the marital residence to the ex-wife, and required the ex-husband to personally assume certain tax liabilities of a business that he had operated during the marriage. The ex-wife was also awarded $40,000 in counsel fees.*fn1
When we last considered the ex-husband's appeal two years ago, we remanded the case to the Family Part "for additional fact-finding" as to certain issues of equitable distribution, alimony, and counsel fees. Hopkins, supra, slip op. at 1. Following the remand, the Family Part conducted an evidentiary hearing on February 17, 2009,*fn2 at which the ex-husband appeared, pro se. The ex-wife, also pro se, who was residing in Texas with the son, was given notice of the remand hearing but failed to appear. The ex-husband testified, but presented no other witnesses.
Following the remand hearing, the trial court suspended the ex-husband's alimony obligation retroactive to December 1, 2008, the approximate date that the ex-wife moved to Texas. The alimony suspension was imposed because the ex-wife failed to comply with the court's pre-hearing directive to update her case information statement with her certified living expenses in Texas and her current assets. The court rejected the exhusband's request for a reduction in his $26,000 annual alimony obligation, even though the ex-husband had earned less than $40,000 each year since the time of the divorce.
With respect to equitable distribution, in its remand decision, the trial court initially agreed that the ex-husband "should not bear the full burden of the tax liability" of his business. However, the court also found that the ex-husband had failed to substantiate how that significant tax liability should be allocated and his expert's correspondence did not offer an opinion on the liability issue. Since the court could not assess the allocation issue, the court determined that the tax liability remained with the ex-husband. The court further noted that the record was unclear as to whether the tax liability had been, or was going to be, discharged in bankruptcy.
Lastly, the trial court reaffirmed the $40,000 counsel fee award to the wife.
The ex-husband now appeals. He argues that, on remand, the trial court improperly imputed income to him without evidence to substantiate or justify such imputation; that it erred in continuing the $40,000 counsel fee award without proof of his ability to pay that sum; that the court wrongfully denied his adjournment request; that the assets of his business should not have been distributed because of priority claims by the Internal Revenue Service; and, that the court should have imputed income to his ex-wife.
We can appreciate the trial court's difficulty in not being provided with competent proofs definitively addressing the issues that were the subject of the remand. With respect to the tax liability, we agree with the trial court that it was incumbent upon the ex-husband, as the movant for relief, to provide sufficient evidence to support his claim that the debt should be borne, at least in part, by the ex-wife. Eaton v. Grau, 368 N.J. Super. 215, 222 (App. Div. 2004) (noting the burden for obtaining relief from a divorce judgment awarding equitable distribution). In this regard, we concur in the court's specific findings that it was "never presented with a complete picture" of the ex-husband's business, which was "formed many years before with a multitude of shareholders," and that "no clear evidence was presented as to [the company's] present status and whether any of the prior owners would be subject to [the tax] liability." Nor did the ex-husband sufficiently clarify and document whether the debt had been, or would be, fully discharged. Given these deficiencies in proof, it was not unreasonable for the judge to conclude that the ex-husband had not met his evidential burden and to deny him relief as to the equitable distribution issues. The ex-husband had proper notice of the hearing date and the denial of an adjournment was within the court's discretion. See Rocco v. N.J. Transit Rail Operations, Inc., 330 N.J. Super. 320, 343-44 (App. Div. 2000).
The alimony issue requires a different analysis. In our view, the ex-husband established a prima facie case of changed circumstances at the remand hearing, justifying a potential adjustment of his $26,000 annual alimony obligation. See Lepis v. Lepis, 83 N.J. 139, 157 (1980) (holding that the moving party must make a prima facie showing that "changed circumstances have substantially impaired the ability to support himself or herself"). The record amassed so far reflects that the ex-husband has been unable to earn more than $40,000 in any year since the divorce, that he has since lost his job, and that, although he holds a realtor's license, he has been unable to enhance or restore his earnings. These earnings shortfalls appear more persisting than short-term, temporary income fluctuations. See Larbig v. Larbig, 384 N.J. Super. 17, 22-23 (App. Div. 2006) (noting that temporary income fluctuations do not represent a change in circumstances). Even though, at the time of the remand hearing, the ex-husband continued to reside with his mother rent-free and his living expenses apparently had not materially increased, we cannot see how the ex-husband realistically can continue to be responsible for $26,000 in annual alimony payments and still have sufficient funds left for his own needs. Based upon the record before us, the alimony should not only be suspended, but most likely also should be modified.
The difficulty with the alimony issue, as the trial judge noted, is that the ex-wife has failed to supply sufficient financial documents to allow the court to assess her current needs, assets, and expenses. Compounding that problem, the ex-wife has chosen not to participate in this appeal. However, unlike the tax liability issue, the deficiency of proof as to the alimony issue is not entirely attributable to the ex-husband.
Consequently, although we affirm the continued suspension of payment of alimony as of December 2008, we also think it fair and appropriate for the trial court to re-examine the alimony issue one more time, specifically to consider whether a reduction in the permanent award is warranted and, if so, whether the effective date of the reduction should be fixed at a date before or after December 2008. If the ex-wife continues to be uncooperative in that endeavor, the trial court retains the discretion to impute her expenses from that of comparably-sized households in Texas and to make other reasonable inferences and assumptions. Reciprocally, the ex-husband should also ...