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Jeffrey Menaged v. Jacqueline Menaged

SUPERIOR COURT OF NEW JERSEY APPELLATE DIVISION


March 3, 2011

JEFFREY MENAGED, PLAINTIFF-APPELLANT/ CROSS-RESPONDENT,
v.
JACQUELINE MENAGED (N/K/A JACQUELINE KUSHNER), DEFENDANT-RESPONDENT/ CROSS-APPELLANT.

On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Monmouth County, Docket No. FM-13-1571-93C.

Per curiam.

NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION

Argued January 10, 2011 -- Decided Before Judges Lisa, Reisner and Sabatino.

Plaintiff, Jeffrey Menaged, appeals from portions of an October 30, 2009 post-judgment order that (1) denied his motion for reconsideration of a provision in a prior order that increased his weekly child support arrears obligation from $50 to $150, and (2) set his child support obligation at $102 per week. Defendant, Jacqueline Kushner, formerly known as Jacqueline Menaged, cross-appeals from a provision in the October 30, 2009 order that denied her motion for reconsideration of a provision in a prior order that awarded plaintiff an $1100 counsel fee.*fn1 Our review of the record persuades us that the trial court's determinations on the discrete issues before us were not in accordance with the controlling legal principles and were internally inconsistent. Accordingly, we vacate the portions of the October 30, 2009 order that are before us and remand for reconsideration of those issues.

This is the pertinent background of the parties. They were married in 1987. They had four children, who are now twenty- three, twenty-two, twenty-one and nineteen years of age. The parties divorced in 1996.

Plaintiff left the country for a time, apparently for several years, and it is believed that he lived in Israel and Mexico during his absence. Substantial child support arrears accumulated while he was absent and, perhaps, at other times. It is undisputed that the arrears are currently about $120,000. Plaintiff has remarried and had an additional child. Defendant has also remarried. Although the particulars are unclear from the record, she has nine children with her current husband.

The parties both live in Long Branch. Plaintiff owns and operates a small business, a franchise known as Pressed4Time. This is a service by which plaintiff picks up clothing from his customers for dry cleaning, delivers them to the company designated by the franchisor for cleaning, and then returns them to the customer. He operates the business out of a van. Ninety-five percent of his customers pay by credit card. Plaintiff's wife is a school music teacher, earning about $44,000 per year.

Defendant is not employed outside the home. In addition to their home in Long Branch, defendant and her husband own a home in Florida, where they vacation periodically. According to plaintiff, defendant drives an expensive car, has housekeepers, makes (along with her husband) generous charitable contributions, and generally lives a rather lavish lifestyle.

A child support order was set in 2000, obligating plaintiff to pay $150 per week, plus $50 per week toward arrears. That was apparently based on income (actual or imputed) to plaintiff of $400 per week (or $20,800 per year). Defendant was not employed outside the home at that time. With periodic cost of living adjustments, by 2009, when the proceedings that are now before us occurred, the weekly support obligation had increased to $190 (plus the $50 toward arrears).

Plaintiff has long been estranged from his children. At the time of the motions that are the subject of this appeal, all four children were over the age of eighteen and had graduated from high school. The oldest was attending college in New York, where she was living with her grandmother. The second child had attended a one-year program in Israel after graduating from high school, and intended to enroll in college in New York, and possibly also live with her grandmother. The third child had also attended the post-high school program in Israel for a year, and was either going to return to that program or attend college in New York the following year. The fourth child had recently graduated high school and intended to attend the Israel program.*fn2

Plaintiff has had no input into the choice of colleges or other educational programs for any of the children. Other than his child support payments, he has not contributed to any college education expenses. In one of the motions contained in the record, we note that defendant sought an order compelling plaintiff to contribute to college education expenses. Applying the factors in Newburgh v. Arrigo, 88 N.J. 529 (1982), the court denied the relief and ordered that plaintiff would not be obligated in that regard unless he was fully informed of the children's plans and intentions and permitted to participate in the decision-making process. That order is not before us, but we mention it to provide further context to the orders that are before us.

The October 30, 2009 order that is before us was the third in a trilogy that included prior orders of May 27, 2009 and August 31, 2009. We now set forth the relevant aspects of the motions leading up to each of the orders and the relevant provisions of the orders.

On February 18, 2009, plaintiff moved to emancipate the three oldest children and to decrease his child support obligation, which was then $190 per week. Defendant opposed the motion and cross-moved for various items of relief. These included requests to increase the child support, to compel plaintiff to contribute to college expenses, and to require plaintiff to carry certain life insurance. She also sought an order to require plaintiff to transfer his home to her in partial satisfaction of the outstanding child support arrears and to provide an accounting of the settlement proceeds paid on behalf of the oldest child when she was much younger in settlement of a claim.

On May 27, 2009, the court denied all of the relief requested by both parties. The order included a provision granting plaintiff a period of six months to track the accounts in which the oldest child's settlement proceeds were deposited.

On June 16, 2009, defendant moved for reconsideration of the denial of all of the relief she had requested. Defendant included in that motion a request that plaintiff's arrearage obligation be increased from $50 to $150. The basis for that request was that at the rate of $50 per week, it would take almost fifty years for plaintiff to pay off the nearly $122,000 then due. She contended that plaintiff had not produced a tax return or Case Information Statement (CIS), and therefore the court should "presume an ability to pay arrears of at least $150.00 per week." Defendant opposed the motion and filed a CIS dated July 16, 2009. That CIS reflected his income for 2008 at $26,784. Plaintiff also requested a counsel fee award, contending that defendant had no basis for her reconsideration motion and was merely rearguing all of the same points that had been previously rejected.

On August 31, 2009, the court entered an order denying defendant's reconsideration motion, but granting her request to increase plaintiff's weekly arrearage obligation from $50 to $150. The court reasoned that although plaintiff reported on his CIS an annual salary of $26,784, because he was self-employed and had not provided a tax return, the court could not determine with confidence the profits plaintiff earned from his business. The court stated that "[g]iven the substantial amount of the arrears, the [c]court grants [d]efendant's request in connection to the child support arrears and [p]laintiff is to pay $150 per week towards the arrears" effective June 16, 2009, the date on which the motion was filed.

In the August 31, 2009 order, the court also dealt with plaintiff's counsel fee request. First, the court denied the request with respect to defendant's prior motion. However, the court then stated:

With respect to this present motion, [p]laintiff is awarded counsel fees. He has incurred additional counsel fees defending an unnecessary motion. Defendant recites the exact arguments made in her prior cross-motion and she does not present new information or evidence to the [c]court. In addition, the relief for the arrears could have been brought to probation. Defendant has the ability to pay [p]laintiff's counsel fees. Though the [c]court does not have [d]efendant's CIS or other financial documents, [d]efendant co-owns [a business] with her current husband.

On September 22, 2009, plaintiff filed a motion which sought the following relief: (1) reconsideration and vacation of the provision in the August 31, 2009 order that increased his weekly arrearage obligation to $150; (2) reduction of his weekly child support obligation from $190 to $50; and (3) counsel fees.

Along with this motion, plaintiff filed a copy of his 2008 tax return. He explained that he had obtained an extension for filing the return and it had not yet been prepared and filed prior to the previous round of motions. It was prepared and filed in the interim, and he now submitted it to the court. The tax return reflected total income to plaintiff for 2008 of $14,761. Therefore, he had overstated his income on the CIS previously filed by about $12,000. Plaintiff also filed other documentary evidence from his business to substantiate that he was not hiding income or claiming business expenses or deductions that would distort his true income.

Plaintiff asserted that this new information, which was not previously available, was material and should be considered with respect to the reasonableness of the increase in his arrearage obligation. Indeed, the combined amount of his weekly child support obligation and his arrearage obligation significantly exceeded his total income. Further, the child support obligation had been established many years earlier with his income set at $400 per week, or $20,800 per year. He was now making much less, and, based upon further documentation he submitted, his 2009 income to date was on a track to result in even lower income than 2008. Based upon those financial circumstances, as well as his remarriage and having another child (then three-and-one-half years old) that he was obligated to support, plaintiff asserted a substantial change in circumstances justifying a decrease in child support.

On October 15, 2009, defendant filed opposition to plaintiff's motion. She also moved for reconsideration of that portion of the August 31, 2009 order that ordered her to pay $1100 for plaintiff's counsel fees. She contended that she acted in good faith, and that, contrary to the court's statement of reasons, she had contacted the probation department seeking to increase plaintiff's arrearage obligation and was told that she would need a court order. Further, she contended that her family business had been defunct for some time, and there was no basis for a finding that she could afford to pay plaintiff's counsel fees.

On October 30, 2009, the court denied plaintiff's reconsideration motion with regard to the $150 per week arrearage obligation. The court basically adopted defendant's rationale for the drastic increase, stating: "If the earlier arrears rate were paid down, to be paid down at the rate of $50 per week, it would take over 47 years for this debt to be brought to a zero balance. At a rate of $150 per week, it would be 16 years." The court continued that "it is the enormity of the debt, as well as the fact that there has been nothing provided to this [c]court by the plaintiff, no new evidence, that presents a valid reason to modify its earlier order. It does not meet any of the tests for reconsideration."

The court then turned to the child support obligation and granted plaintiff's request for a substantial reduction. The court noted that the tax return reflected income substantially lower than that previously shown in the CIS and that plaintiff's additional child was also a change in circumstances. Thus, the court was satisfied that the plaintiff has made out a prima facie change for the recalculation of child support. The [c]court uses the plaintiff's business profit as it was reported in 2008 as his income. And the defendant's income was imputed using the New Jersey minimum wage. In addition, the [c]court factored in the income of the plaintiff['s] spouse.

The court then did a calculation applying the child support guidelines. In doing so, the court used plaintiff's income as reported on his tax return, $14,761, which the court obviously accepted as reliable and factual. The guideline calculation resulted in a weekly support obligation of $102. That is what the court ordered.

Finally, the court denied plaintiff's motion to reconsider the $1100 counsel fee award.

Granting a motion for reconsideration is a matter that is within the sound discretion of the court. Cummings v. Bahr, 295 N.J. Super. 374, 384--85 (App. Div. 1996). This discretion should only be exercised when required in the interest of justice. Id. at 384. Generally, a motion for reconsideration requires the movant to "state, with specificity the basis on which it is made, including a statement of the matters or controlling decisions which counsel believes the court has overlooked or to which it has erred." R. 4:49-2. The rule applies when "the court failed to consider evidence or there is good reason for it to reconsider new information." Pressler & Verniero, Current N.J. Court Rules, comment on R. 4:49-2 (2010) (citing Cummings, supra, 295 N.J. Super. at 384--85).

Reconsideration should be utilized only for those cases which fall into that narrow corridor in which either 1) the [c]court has expressed its decision based upon a palpably incorrect or irrational basis, or 2) it is obvious that the [c]court either did not consider, or failed to appreciate the significance of probative, competent evidence. Said another way, a litigant must initially demonstrate that the [c]court acted in an arbitrary, capricious, or unreasonable manner, before the [c]court should engage in the actual reconsideration process. [D'Atria v. D'Atria, 242 N.J. Super. 392, 401 (Ch. Div. 1990).]

Further, a litigant may bring new, previously unavailable evidence to the court's attention. Ibid. ("[I]f a litigant wishes to bring new or additional information to the Court's attention which it could not have provided on the first application, the [c]court should, in the interest of justice (and in the exercise of sound discretion), consider the evidence.")

Upon submission of his motion for reconsideration, plaintiff produced financial documents which were not available at the time of the motion underlying the August 31, 2009 order. His 2008 tax return was filed on September 17, 2009, between the time that the arrears payment was increased and the motion to reconsider was submitted.

Defendant contends that plaintiff's tax return should be discounted because, as a self-employed person, he is in a position to easily obfuscate his earnings. See Larbig v. Larbig, 384 N.J. Super. 17, 23 (App. Div. 2006) ("[I]t is the self-employed obligor who is in a better position to present an unrealistic picture of his or her actual income . . . ."). However, this credibility issue is one for the court to weigh in its discretion when considering evidence. Presumably, the court found the evidence credible because it used it to calculate the reduced child support obligation. As permitted by D'Atria, plaintiff produced additional probative data that was unavailable for the trial court's initial consideration.

The August 31, 2009 order was based on the court's belief that plaintiff's salary was $26,784, and the statement of reasons specifically noted that the court was unable to view his tax return. On the motion for reconsideration, plaintiff produced his tax return which demonstrated that his income was actually $12,000 less than the previously stated amount upon which the court had based its decision to increase the arrears obligation. In the October 30, 2009 decision, the court failed to acknowledge any new evidence, and did not discuss whether or not the evidence produced was sufficient to justify reconsideration of the arrearage issue. However, the court did compute a reduction in plaintiff's child support obligation utilizing that very evidence.

It is readily apparent that the court's rationale was internally inconsistent. Based upon the same evidence, the court found no basis to revisit the tripled arrearage obligation, yet it found a sufficient basis to demonstrate material changed circumstances warranting a large reduction in the child support obligation. The court's reasoning does not accord with the principles guiding reconsideration applications that we have described. It is apparent that the court failed to consider the new information, which the court obviously found reliable as to the support issue, in analyzing the arrearage obligation. Further, the result, which cut the child support obligation nearly in half and, at the same time, tripled the arrearage obligation, all based on the same evidentiary record, cannot be reconciled.

Likewise, the resulting order obligates plaintiff to pay about eighty-nine percent of his income in child support and arrears. We recognize that the income of plaintiff's current wife can be considered in this connection. See Hudson v. Hudson, 315 N.J. Super. 577, 583-84 (App. Div. 1998).

Nevertheless, with such a high percentage, some reasonable analysis and rationale should be expressed. We also find flawed the rationale for increasing the weekly arrearage obligation from $50 to $150 because it would take forty-seven years to pay it off at the lower amount. Plaintiff was not seeking a long-term restoration of the lower amount, but only a temporary modification until his child support obligation ends. Considering the ages and circumstances of the children, that should occur in the not-too-distant future. Plaintiff acknowledges that an increase would then be appropriate.

The court gave no reason for denying defendant's reconsideration motion regarding the $1100 counsel fee award assessed against her. The court did not consider defendant's contentions that her family business was defunct and she could not afford to pay, nor did it consider her assertion that she attempted to seek an increase in plaintiff's arrearage obligation by going directly to the probation department, only to be told that she needed to apply to the court. Most notably, what the court characterized as defendant's "unnecessary" motion, resulted in very substantial relief in favor of defendant, namely, a tripling of the arrearage obligation.

We are therefore constrained to vacate the three aspects of the October 30, 2009 order that are before us. These are the amount of the child support obligation, the amount of the arrearage obligation, and the $1100 counsel fee award. We remand for further proceedings in accordance with this opinion. We do not retain jurisdiction.


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