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Ellen Hall Martignetti v. Christopher Martignetti

December 29, 2010


On appeal from Superior Court of New Jersey, Chancery Division, Family Part, Somerset County, Docket No. FM-18-427-05.

Per curiam.


Argued December 2, 2009 - Decided

Before Judges Graves, J.N. Harris and Newman.

Plaintiff Ellen Hall Martignetti and defendant Christopher Martignetti were married on August 28, 1998. One child was born of the marriage, a daughter, who is now eleven years old.

Plaintiff's complaint for divorce was filed on October 8, 2004.

The matter was tried between January 2006 and May 2007, and a dual judgment of divorce (JOD) was entered on October 5, 2007.

The trial court set forth its findings of fact and conclusions of law in a forty-nine-page written decision. Defendant appeals and plaintiff cross-appeals from several portions of the final judgment and from post-judgment orders entered on December 14, 2007, and May 9, 2008. For the reasons that follow, we affirm in part and reverse and remand in part.

Plaintiff was thirty-eight years old when she met defendant in the Summer of 1997. Plaintiff and her first husband, Gary McCulla, separated in 1995, and she was residing in Branchburg, New Jersey, with her two daughters from that marriage. Plaintiff is a college graduate with a degree in business management and a paralegal certificate. She also took some graduate courses in business but did not obtain a graduate degree. Plaintiff worked in the accounting department for a drug company until her first child was born in 1986. She was subsequently part owner and manager of a gym. However, plaintiff was not employed when the parties met, and she did not work outside of the home during their marriage.

Plaintiff testified she believed defendant was "financially successful" when she met him because he told her that he earned a yearly salary of $100,000 to $150,000 from a trucking company he owned and that he had received a $250,000 settlement from a work-related injury. In addition, plaintiff testified defendant lived in a "beautifully furnished" apartment in Westfield, New Jersey, drove a Mercedes Benz, and took her to nice restaurants and shows in New York City and Atlantic City.

On the other hand, defendant said he was not making "much at all" when he met plaintiff because he and his father were "still developing" a trucking business they had started.

According to defendant, he has "only a high school education" and his "entire career has been spent as a truck driver." Defendant testified he was earning about $500 to $600 a week when he met plaintiff, and his income from the trucking business "stayed the same because we were trying to build, buying more trucks and getting bigger."

With regard to his trucking company, defendant testified as follows:

Q. So according to your testimony you were just starting up 21st Trucking Company, correct?

A. 21st Trucking Company, right.

Q. In 1997.

A. Right.

Q. And when you incorporated 21st Trucking Company in October 1998 you were the sole shareholder, correct?

A. Yes. Yes, I was.

Q. But you were working with your father.

A. Yes.

Q. But you were the only one who owned any shares of the company, correct?

A. Yes.

Q. Now, what was the nature of the business of 21st Trucking Company?

A. 21st Trucking Company would go to the pier and pick up containers, overseas containers, and deliver them in the tri-state area.

Q. And that business was in operation for a period of approximately five years, correct?

A. Approximately five years. I would go with that.

Q. Okay. So . . . you would agree then that this was the business that was in operation through the majority of your marriage.

A. Yes, yes.

Q. And would it be fair to say, sir, that during the course of your marriage this business was growing?

A. Yes.

Q. And . . . again, turning back to when you first just started back in July of 1997, between July 1997 and August of 1998 did the business grow?

A. Well . . . it wasn't incorporated yet, but yes, we were setting things up and I'm going and getting accounts. And, you know, my dad had the one truck, and then . . . me and Ellen bought two more trucks and, you know, we started it slowly.

When plaintiff and defendant began dating, plaintiff was in the process of negotiating a property settlement agreement with her first husband, and she was looking for a new home for herself and her two children. In September 1997, defendant's mother told plaintiff about a house in Warren, New Jersey, and plaintiff contracted to purchase the home for $765,000. The closing was scheduled to take place in November 1997. Plaintiff testified her attorney had passed away and defendant recommended his attorney, Jeffrey Shapiro, Esq. Plaintiff purchased the home on November 28, 1997, using funds advanced by her first husband in anticipation of their divorce settlement. Defendant attended the closing with plaintiff, but he was not a party to the transaction and the deed identified plaintiff as the sole owner of the property.

Following the closing, defendant and his father helped plaintiff and her daughters move into the home. Defendant said he moved in the following day. However, plaintiff testified defendant began living at the Warren home in December 1997 after the lease on his apartment expired. In any event, when asked how the parties allocated their expenses while living together, defendant testified: "[Plaintiff] used to get the bills and go upstairs and pay everything on the computer."

In February 1998, plaintiff and defendant obtained a $60,000 line of credit, which was secured by a mortgage on the Warren home. They both signed for the loan and agreed to be individually responsible for the funds they used. Plaintiff testified she used the line of credit to make improvements to the home, and she paid her portion of the debt in full. Defendant continued to use the line of credit, however. At trial, defendant conceded that he utilized the funds in connection with his trucking company: "[W]e bought two trucks like two or three years later and they were $25,000 a piece, so that would be about $50,000. But I don't remember taking the whole $50,000 from the credit line. I don't know how we got the money but we did it." At the time of trial, the credit line had an outstanding balance of approximately $55,000.

Plaintiff and her first husband finalized their divorce on March 24, 1998. Pursuant to their property settlement agreement, plaintiff received $7.4 million. In addition, the agreement provided that plaintiff would retain all furniture and jewelry in her possession, and she would receive child support for the two minor children of the marriage in the amount of $3000 per month.

Plaintiff placed her divorce settlement funds in a brokerage account managed by Condor Capital. Plaintiff testified she received approximately $10,000 per month from the brokerage account, but she also acknowledged withdrawing additional amounts from the account for home improvements and various other expenses.

Plaintiff testified defendant never deposited any monies into her brokerage account and denied that defendant had any involvement in managing her investments. When defendant was questioned regarding the account, he acknowledged he never had any direct conversations with the account manager but said he "would watch the stock market daily" and "was watching Condor, you know, just making sure everything was okay."

In the Spring of 1998, plaintiff began making substantial improvements to the Warren home. The improvements included various landscaping projects, installing new doors and "built- ins in the closets," and completing the basement. Plaintiff testified that she paid for all of the improvements with money from her brokerage account, and that it cost approximately $150,000 to finish the basement.

Defendant claimed he and his family and friends did most of the work, particularly on the basement and landscaping. The parties disagreed, however, on the extent of defendant's involvement. Plaintiff said she gave defendant cash and checks "to pay people," but she denied that defendant did any of the work himself.

Although the parties resided together in the Warren home, plaintiff said she "did not plan on getting married" and was surprised when defendant proposed in June 1998. Prior to the marriage, which took place on August 28, 1998, plaintiff testified she had a discussion with defendant regarding the Warren home and told him "this is my home with the girls."

According to plaintiff, defendant "a hundred percent agreed," and the parties further agreed as follows:

And when we live [here], we live separately as far as finances are concerned because Chris owned and operated a trucking company. Chris said he had a home down in Florida. He had his own assets. They were kept separate, and that's how we agreed to run everything. This is my home. I take care of this home. I take care of my expenses and the home expenses.

And this is Chris' business. This is his income. He takes care of his expenses, his bills or whatever. This is how things were treated.

On February 1, 1999, plaintiff executed various estate planning documents, including a will that left most of her estate to her daughters. None of the documents mentioned defendant.

A few weeks later, on February 13, 1999, plaintiff made an offer to purchase a home on Long Beach Island (LBI) for $597,500, and the offer was accepted. Plaintiff withdrew the funds to purchase the home from her brokerage account, and the deed identified plaintiff as the sole owner of the property. Plaintiff also withdrew funds from her brokerage account to pay for improvements to the LBI home. Plaintiff testified the bulkhead was replaced, the property was landscaped, a loft was built in the garage, and new kitchen appliances were installed. Once again, the extent of defendant's involvement with the improvements was disputed. In a pretrial certification, and at trial, defendant stated that he personally performed many of the improvements:

I helped build a huge loft in the garage. I painted the garage floor and installed shelving to hang the bicycles and organize the garage. I performed a great deal of the landscaping myself. I bought and paid for four truckloads of topsoil and spread it out all around the property and had [four] loads of stones spread out around the property. I cut down twenty-two fifty foot pine trees all around the property and grinded out the roots. My cousin and I insulated the pipes. I installed the outdoor floodlights and the water system in the back. I put all new vents underneath the house. I maintained the decks and bulkheads every year (power washing and staining them). I participated with the plaintiff in furnishing and decorating the home and did many other things.

The parties' daughter was born on September 27, 1999. On the first day of trial, the parties agreed to joint legal custody of their daughter and a shared physical custody arrangement. However, they were unable to reach an agreement on child support, and that issue was decided by the trial court.

Plaintiff testified defendant began demanding that she add him to her estate plan and that she place the deed to the Warren home in both their names as joint owners after their daughter was born. In addition, she claimed she received demanding letters from James Yudes, Esq., defendant's attorney, regarding her estate plan and the Warren home.

In support of her claim, plaintiff produced copies of letters that Yudes wrote to Steven L. Friedman, Esq., the attorney who prepared plaintiff's 1999 estate plan. In a letter dated January 4, 2002, Yudes claimed he had written to Friedman "on several occasions" with no response:

Dear Mr. Friedman:

I have written to you on several occasions with regard to the above captioned matter to determine whether or not your client has done what she promised her husband she would do concerning her estate and the current transfer of property to my client. To date, I have not received any response from you.

As my client believes he and his wife were working towards a good faith resolution of economic issues between them, I had hoped to receive some cooperation from you.

My client's wife reported to him that she has sat down with you and that you do have a response. Would you like to share it with me? Would you like to sit down with me to discuss this matter or would you like to simply ignore my letters?

Please advise.

On May 23, 2002, plaintiff executed a revised estate plan. When asked why she revised the plan, she said she "was being forced by Chris and Mr. Yudes" to make changes to her estate. Plaintiff's revised estate plan complied with the elective share law, N.J.S.A. 3B:8-1 to -19, and Friedman testified he drafted the plan in accordance with plaintiff's wishes.

Defendant testified that in June 2003 he received a copy of plaintiff's revised estate plan and reviewed it with Yudes. He was unhappy with the plan because he expected to receive more than the elective share, and because he thought the plan ...

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