December 8, 2010
KEVE STEVENS, PLAINTIFF-APPELLANT,
MARCIA STEVENS, DEFENDANT-RESPONDENT.
On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Morris County, Docket No. FM-14-1026-08.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted: November 17, 2010
Before Judges Fisher and Fasciale.
In this post-divorce judgment matrimonial action, plaintiff Keve Stevens appeals from an August 3, 2009 order denying his motion in aid of litigant's rights. He sought to enforce Article XI paragraph two of the parties' property settlement agreement (PSA) that required defendant Marcia Stevens to file joint tax returns in 2007. We conclude that the tax provision of the PSA is unenforceable, and affirm.
The parties incorporated the PSA into their judgment of divorce dated March 3, 2008. During the negotiations leading up to the PSA, Keve represented to Marcia that prior tax returns had been or would be filed. Marcia relied on that representation and agreed to the language in Article XI of the PSA that provided in part:
1. If either party is advised of an audit on any prior jointly filed tax returns, then he or she will immediately notify the other party and the parties will then jointly decide how they will proceed.
2. The parties will file joint Federal and State tax returns for the 2007 tax year and will equally share any refunds/tax liabilities associated therewith.
In May 2008, Keve requested that Marcia execute their 2005 joint tax returns. Marcia understood, based on Keve's representations, that he had filed these returns previously, but she executed the documents nevertheless. In January 2009, the State alerted Marcia that she owed fees and penalties regarding their 2005 tax return. Marcia paid the deficiencies to protect her own credit. Concerned about the status of their tax returns, Marcia contacted the Internal Revenue Service and learned that Keve failed to file their federal tax returns for 2005 and 2006.
Marcia acknowledged that the PSA obligated her to file the 2007 tax returns jointly, but notified Keve that she intended to file her own individual tax return for the year 2007. Marcia's attorney explained to Keve's attorney:
As you are undoubtedly aware, during the pendency of this divorce action, there were ongoing problems with regard to [Keve's] failure to timely and appropriately file tax returns. That being the case, and given the fact that [Keve] did not do as he was obligated to, timely file the parties' joint 2007 tax return, [Marcia] has taken the initiative and is filing solely.
Marcia maintained that she no longer trusted Keve to file tax returns timely and decided that she would file by herself.
The family part judge denied Keve's motion in aid of litigant's rights to compel Marcia to file jointly and stated:
Although the PSA states [that] the parties shall file a joint return for 2007, the court declines to enforce that provision as [Keve's] conduct in regard to 2005 and 2006 renders that provision inequitable. [Marcia] expressed concern that the 2005 and 2006 returns were not filed. The only proof [Keve] has submitted is there was a payment voucher for 2006 received by the IRS on February 17, 2009. There is no proof of the filing of either state or federal tax returns for 2005 and 2006, only the payment voucher. Draft returns were sent to the defendant on May 27, 2008 (2005) and July 21, 2008 (2006). For 2005, the amount of $5,829 was due to the IRS and $1,895 due to New Jersey. For 2006, the amount due the IRS was $15,304 and $1,041 due New Jersey. Nothing was paid until February 2009, almost one year after the Judgment of Divorce.
[Marcia] is understandably concerned about the tax liability to herself. She filed her own 2007 tax return. Even now, [Keve] has not proven he filed the 2005 and 2006 federal and state tax returns to this court.
On appeal, Keve argues that the judge erred by failing to (1) enforce the PSA; (2) conduct a plenary hearing; (3) conduct oral argument; and (4) grant his request for attorney's fees. We disagree.
"The scope of appellate review of a trial court's fact-finding function is limited. The general rule is that findings by the trial court are binding on appeal when supported by adequate, substantial, credible evidence." Cesare v. Cesare, 154 N.J. 394, 411-12 (1998). Furthermore, due to the family courts' special jurisdiction and expertise in such matters, we defer to a family judge's fact-finding. Id. at 413.
The findings made by the motion judge are supported by sufficient credible evidence. Marcia expressed concern that the 2005 and 2006 returns were not filed and she was understandably concerned about her own tax liability. The judge found that Keve failed to file the parties' joint tax returns for 2005 and 2006. We see no reason to disturb that conclusion.
Keve's motion to compel Marcia to file jointly was made with "unclean hands." This equitable maxim holds that "[a] suitor in equity must come into court with clean hands and he must keep them clean after his entry and throughout the proceedings." A. Hollander & Son, Inc. v. Imperial Fur Blending Corp., 2 N.J. 235, 246 (1949); Chrisomalis v. Chrisomalis, 260 N.J. Super. 50, 53-54 (App. Div. 1992); accord Johnson v. Johnson, 212 N.J. Super. 368, 384 (Ch. Div. 1986). In other words, "a court should not grant relief to one who is a wrongdoer with respect to the subject matter in suit." Faustin v. Lewis, 85 N.J. 507, 511 (1981).
A trial court has the discretionary authority to compel parties in a divorce action to file tax returns jointly, but "should avoid compelling parties to execute joint tax returns because of the potential liability to which the parties would be exposed." Bursztyn v. Bursztyn, 379 N.J. Super. 385, 398 (App. Div. 2005). Under the circumstances of this case, the judge did not abuse his discretion by refusing to enforce the tax provision in the PSA.
We also reject Keve's argument that it was an abuse of discretion to deny his requests for oral argument, conduct a plenary hearing, or grant him attorneys fees. The judge stated that he declined oral argument because "the issues were clear and there would be no benefit to the parties to incur additional cost." We agree.
The court "shall ordinarily grant requests for oral argument on substantive . . . motions." Rule 5:5-4(a). However, a court has discretion to deny a request for oral argument. Palombi v. Palombi 414 N.J. Super. 274, 286-88 (App. Div. 2010) (trial court properly denied several motions requesting oral argument because each motion either failed to raise a "substantive" issue; failed to timely file opposition papers; or the parties failed to provide an adequate factual basis for the court to make a determination on the issues presented); Kozak v. Kozak, 280 N.J. Super. 272, 275 (Ch. Div. 1994) (denying oral argument where no basis existed to grant the relief sought by defendant), certif. denied, 151 N.J. 73 (1997). There was no abuse of that discretion. After reviewing voluminous submissions by the parties, the judge stated, "[e]ven now, [Keve] has not proven he filed the 2005 and 2006 federal and state tax returns to this court." There is no substantive issue about whether Keve filed the returns. Oral argument therefore would be "unnecessary" or "unproductive advocacy."
We review the trial court's determination whether or not to conduct a plenary hearing pursuant to the abuse of discretion standard. Hand v. Hand, 391 N.J. Super. 102, 112 (App. Div. 2007). Here, we conclude that there was no abuse of discretion by not conducting a plenary hearing.
In matrimonial cases, awarding counsel fees is left to the sound discretion of the trial judge. Salch v. Salch, 240 N.J. Super. 441, 443 (App. Div. 1990). There was no abuse of discretion to deny Keve's request for fees.
© 1992-2010 VersusLaw Inc.