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Michael Goldstein v. Marci Goldstein

SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION


January 18, 2011

MICHAEL GOLDSTEIN, PLAINTIFF-APPELLANT,
v.
MARCI GOLDSTEIN, DEFENDANT-RESPONDENT.

On appeal from Superior Court of New Jersey, Chancery Division, Family Part, Essex County, Docket No. FM-07-2234-04.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued September 15, 2010 - Decided

Before Judges Fuentes, Gilroy and Ashrafi.

Plaintiff Michael Goldstein appeals from the order of the Family Part denying his motion for a downward modification of his alimony obligation and determining the amount of arrears due to his former wife, defendant Marci Goldstein. Plaintiff argues that the court failed to give due consideration to evidence showing his significant and permanent loss of income since the time he agreed to pay defendant $22,000 a month in alimony.

After reviewing the record before us, we are unable to ascertain the basis for the trial court's ruling. The motion judge did not make specific factual findings concerning plaintiff's claims that technological innovations beyond his control have rendered him permanently incapable of earning the level of income he earned in November 2005, when he agreed to pay defendant $22,000 per month in alimony. We thus remand for the court to articulate with specificity the facts underpinning plaintiff's motion, and the legal principles governing its disposition. R. 1:7-4(a).

I

The parties were married in 1996 and had three children, a girl born in 1997, and two boys born in 2000 and 2002. During the course of the marriage plaintiff worked as a commodities trader, trading privately on a personal trading account on the New York Mercantile Exchange. Thus, in contrast to a broker or a dealer, plaintiff traded using his personal funds and conducted his trades in person on the floor, or "pit," of the Exchange. Between 2000 and 2006, plaintiff earned in excess of $1,000,000 per year, with a peak gross income of $2,647,244 in 2005.

The parties divorced through a dual Final Judgment of Divorce (JOD) entered by the court on November 2, 2005. As part of the JOD, the parties agreed that plaintiff was to pay limited duration alimony of $22,000 per month to defendant for a period of ten years, an additional $4,000 per month for child support, and numerous other expenses for the benefit of the children, including continued health insurance coverage, Hebrew school tuition, and summer camp fees.*fn1 Plaintiff remarried in April 2006; he and his current wife have a son born in 2007.

Plaintiff's inability to maintain this level of financial support first surfaced in February 2008, when defendant filed a motion for enforcement of litigant's rights, alleging that plaintiff had ceased paying alimony as of the start of 2008. In turn, plaintiff filed a motion seeking a modification of his support obligations, claiming that his earnings dropped significantly during the final months of 2007. According to plaintiff, he earned a total of $25,000 during the last seven months of 2007, and estimated this decline would continue in 2008.

Plaintiff attributed this drastic downward change in income to the introduction of mandatory computer trading, which he claims "significantly altered the commodities market" because "transactions previously open only to plaintiff and his colleagues in the 'pit' were now available to everyone in the world," and thus "[t]he benefit and trading edge that plaintiff formerly enjoyed were gone." The Family Part denied plaintiff's motion for modification of support in an order dated March 28, 2008.

In July 2008, defendant filed a second motion for enforcement of litigant's rights. Plaintiff again responded with a motion for modification of support. A different Family Part Judge temporarily reduced plaintiff's alimony support obligation to $5,000 per month pending a plenary hearing, which took place on May 27, 2009.

At the hearing, plaintiff testified that he "went from making a million dollars a year to under $100,000"; his counsel argued that it had become "simply impossible [for plaintiff] to meet [his] financial obligation to [his] former wife." According to plaintiff, as a result of his decline in income, he had been forced to sell his house, his car, and some jewelry and to apply the proceeds of these sales to pay back taxes, alimony, and child support. He and his current wife have worked to "cut costs wherever possible," including resigning as a "golf member" from their country club and no longer taking vacations.

With respect to this ability to continue to work as a commodities trader, plaintiff testified that he has started "taking [computer] classes . . . going to seminars . . . [and] doing everything [he] can to get successful again at trading." When defendant's attorney questioned him about the steps he has taken to procure alternative and more lucrative employment, plaintiff indicated that he had circulated copies of his resume and spoken with colleagues in the field, but stated that "[t]hey're not hiring jobs in [his] field, because people are getting laid off in [his] field."

Defendant testified that since the time the support order was modified from $22,000 per month to $5,000 per month in October 2008, she had worked as a substitute teacher four to five days per week as a means of supplementing her income and earned $100 per day in that capacity.

With respect to her current lifestyle, defendant testified that, although she had reduced her living expenses as much as possible since starting to receive a lesser amount of alimony, she is still unable to maintain her current standard of living without exhausting her assets. She was reluctant to seek other forms of employment affording her more work hours or higher pay because it would require expenditure for child care. According to defendant, she was unable to maintain her children at the standard of living to which they had grown accustomed.

At the conclusion of this evidentiary hearing, the motion judge indicated that plaintiff had not met his burden of demonstrating a change in financial circumstances warranting a permanent modification of his support obligations. Despite this, the court reduced plaintiff's alimony obligation to $5,000 per month, to continue through the end of 2009, at which time it returned to the original level of $22,000 per month. The court also entered an order fixing alimony arrearages at $13,505. The judge gave the following explanation in support of her ruling:

Well, after having heard everything that's been presented today, Mr. Goldstein, I don't find that you met the burden to have a permanent reduction or modification of alimony or child support. What I propose is that I will continue my order that I entered back in October where I reduced your alimony obligation to $5,000 a month. I will continue that until the end of the year to allow you another six months to continue, one, either continue, if you think you're [going to] become successful and successful in this field and go back to earning what you were earning or similar to what you were earning as opposed to $60,000. And if not, then you need to look for a different job in a different profession, because you have an obligation to support these children. You have an obligation to live up to the terms under the property settlement agreement. And I understand that the world has changed and our economy has changed, and everybody right now, most people are suffering. And, quite honestly, that's why I'm giving you another six months, because if we weren't in this current economic times, I probably would deny your motion right now. But I will give you another six months to do that, but understand, come the end , that it's [going to] go back to the $22,000 a month. So you need to either accelerate your learning curve or you need to find another job. That's the bottom line.

II

In calculating an initial alimony award, a court must consider the lifestyle to which the supported spouse has become accustomed during marriage and set the alimony at a level that will best allow the supported spouse to continue to live at that same level. Crews v. Crews, 164 N.J. 11, 24-25 (2000). Thereafter, alimony awards should "receive continued enforcement without modification only so long as they remain fair and equitable." Lepis v. Lepis, 83 N.J. 139, 149 (1980). A court may modify an alimony award if it finds a change in circumstances. Innes v. Innes, 117 N.J. 496, 503 (1990); N.J.S.A. 2A:34-23. One factor that may potentially constitute a change in circumstances warranting modification of a support order is a decrease in the financial resources or income of the supporting spouse. Martindell v. Martindell, 21 N.J. 341, 355 (1956).

The party seeking a modification of the award has the burden of establishing a change in circumstances that would warrant such relief. Lepis, supra, 83 N.J. at 157. The moving party must first present a prima facie case of changed circumstances, and if this burden is met, courts may then order further discovery of the parties' financial statuses. Ibid. A determination is then made as to whether the change in circumstances is such that the ability of the moving party to support himself or herself has been "substantially impaired." Crews, supra, 164 N.J. at 28 (quoting Lepis, supra, 83 N.J. at 157).

General factors that courts must consider in determining whether modification is proper include "the dependent spouse's needs, that spouse's ability to contribute to the fulfillment of those needs, and the supporting spouse's ability to maintain the dependent spouse at the former standard." Lepis, supra, 83 N.J. at 152. When considering a motion for a downward modification in alimony, "the central issue is the supporting spouse's ability to pay." Miller v. Miller, 160 N.J. 408, 420 (1999).

A reviewing court must take into account the supporting spouse's "potential to generate income" through employment earnings as well as "[r]eal property, capital assets, investment portfolio, and capacity to earn by 'diligent attention to . . . business. . . .'" Id. at 420-21 (quoting Bonanno v. Bonanno, 4 N.J. 268, 275 (1950)). The court must also consider whether the claimed change in financial circumstances is temporary or permanent. Innes, supra, 117 N.J. at 504.

In deciding a motion for modification of support payments based on changed financial circumstances, "[t]he trial court must consider . . . what is equitable and fair in all the circumstances." Donnelly v. Donnelly, 405 N.J. Super. 117, 130 (App. Div. 2009). This determination "requires not only an examination of the parties' earnings but also how they have expended their income and utilized their assets." Ibid.

From this record, we are unable to discern the facts upon which the motion judge relied in reaching her ultimate conclusion that plaintiff had not met his burden of proof. Because the court conducted an evidentiary hearing, we presume that it found that plaintiff had established a prima facie case of changed circumstances. Based on this, the court needed to determine the validity of plaintiff's claims that his skills as a trader are no longer marketable or relevant because technology has redesigned the way commodities are traded. If the court finds a sufficient basis to accept such a claim, plaintiff has the burden of showing whether technological training or education in other areas of endeavor are feasible options given his age, general education, professional background, and any other factors that may bear upon his employability. We leave it to the discretion of the trial court to determine if plaintiff needs to present expert testimony in any of these areas in order to meet his burden of proof.

The trial court's conclusory statements cannot be sustained because they were not tethered to specific factual findings. As required by Rule 1:7-4(a), the trial court must make the findings and analysis necessary to enable this court to conduct meaningful appellate review.

Reversed and remanded. We do not retain jurisdiction.


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