April 29, 2011
JOSEPH D. RINDNER, PLAINTIFF-RESPONDENT,
SUSAN T. BLOIR, DEFENDANT-APPELLANT.
On Appeal from Superior Court of New Jersey, Chancery Division, Family Part, Monmouth County, Docket No. FM-13-1960-99.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued October 20, 2010
Before Judges Fuentes, Gilroy and Nugent.
Defendant Susan T. Bloir appeals from three post-judgment matrimonial orders in which the judge reduced plaintiff Joseph D. Rindner's alimony and child support obligations, imposed a child support obligation on defendant, and denied defendant's motion for reconsideration of those decisions. For the reasons that follow, we affirm in part, and reverse in part.
Plaintiff and defendant were married in August 1984 and were granted a dual judgment of divorce (JOD) in November 2001. Four children were born of the marriage: R.R. in 1985; B.R. in 1987; S.R. in 1989; and J.R. in 1991. The JOD incorporated a property settlement agreement (PSA) dated November 14, 2001, which addressed alimony, child support, and equitable distribution; and provided for joint legal custody of the children with defendant designated as the parent of primary residence.
When the parties entered into the PSA, plaintiff earned $92,000 per year and defendant earned $18,000 per year. The PSA required that plaintiff pay $271 per week in child support for the four children, and $200 per week in alimony. The parties recognized in the PSA "that once the children are in either high school, college and/or emancipated that [defendant] can be employed on a full-time basis." Consequently, the PSA provided that "[t]he youngest child's entry into high school may be considered as a change of circumstance for purposes of an alimony review for the Court." J.R., the youngest child, started high school in 2006.
Plaintiff now owns his own business selling hearing aids and accessories, and defendant holds two teaching positions. According to the parties' 2008 tax returns, plaintiff earned $79,500 and defendant earned $43,748. Plaintiff's business had gross receipts of $368,064, but an ordinary business loss of $14,277. Plaintiff paid $8,000 in alimony to defendant in 2008.
The parties filed a series of motions and cross-motions in 2007 and 2008. The family judge entered an order dated November 30, 2007, emancipating B.R., denying plaintiff's motion to terminate alimony, and increasing plaintiff's weekly child support obligation to $354; and an order dated September 26, 2008, emancipating R.R. and terminating plaintiff's alimony obligation. On November 21, 2008, the judge granted defendant's motion for reconsideration of the September order, reinstated plaintiff's alimony obligation, permitted plaintiff to file a motion to address modification of alimony, and ordered the parties to exchange current financial statements.
In December 2008 the parties filed cross-motions resulting in the judge entering a January 28, 2009 order that granted plaintiff's motion to reduce child support and alimony but did not fix a new amount for either obligation, and ordered the parties to provide updated financial information within thirty days. The order denied plaintiff's request, made in a certification but not in the notice of motion, that defendant pay child support for S.R. Finally, the order provided that plaintiff could file a motion for modification of alimony, and that either party could file a motion to address child support.
The parties subsequently filed cross-motions that resulted in an order dated August 31, 2009. The judge reduced plaintiff's weekly alimony payments to $125, ordered him to pay $168 in weekly child support for J.R., and ordered him to pay $200 per month to satisfy his support arrearages. The judge also ordered that defendant pay $108 in weekly child support for S.R. and denied her motion for reconsideration of the January 28, 2009 order. On October 30, 2009, the judge denied defendant's motion for reconsideration of the August 31, 2009 order, and granted plaintiff's cross-motion to have defendant's child support paid through the probation department by way of a wage execution. This appeal followed.
Defendant first contends the trial judge abused his discretion when he determined in the January 28, 2009 order to modify plaintiff's child support and alimony.
Alimony and child support may be modified by a court upon a showing of "changed circumstances." Lepis v. Lepis, 83 N.J. 139, 146 (1980). "Whether an alimony [or child support] obligation should be modified based upon a claim of changed circumstances rests within a Family Part judge's sound discretion." Larbig v. Larbig, 384 N.J. Super. 17, 21 (App. Div. 2006). Each motion to modify "'rests upon its own particular footing and the appellate court must give due recognition to the wide discretion which our law rightly affords to the trial judges who deal with these matters.'" Ibid. (quoting Martindell v. Martindell, 21 N.J. 341, 355 (1956)).
The party seeking modification has the burden of showing changed circumstances. Lepis, supra, 83 N.J. at 157. If a prima facie showing of changed circumstances is made, a court will order discovery. Ibid. If, after a review of the discovery, the court determines that there is a genuine issue of material fact in dispute, a plenary hearing will be held. Id. at 159.
Although equity demands that spouses be afforded an opportunity to seek modification, the opportunity need not include a hearing when the material facts are not in genuine dispute.... [A] party must clearly demonstrate the existence of a genuine issue as to a material fact before a hearing is necessary. Without such a standard, courts would be obligated to hold hearings on every modification application. The application of the equitable principles we have outlined does not require elaborate procedures in every case. Courts should be free to exercise their discretion to prevent unnecessary duplication of proofs and arguments. The volume of postjudgment litigation provides additional, practical support for this approach.
In determining whether a material fact is in dispute, a court should rely on the supporting documents and affidavits of the parties. Conclusory allegations would, of course, be disregarded. Only statements to which a party could testify should be considered. Thus, if the sole dispute centered around the supporting spouse's earnings, the disclosure of income tax returns might render a hearing unnecessary. [Ibid. (internal citations omitted).]
The family judge did not abuse his discretion by determining that there had been a prima facie showing of changed circumstances warranting a modification of alimony and child support. The judge evaluated the parties' financial information, including their case information statements and 2007 income tax returns. It was undisputed that R.R. had been emancipated, and the PSA's provision that "[t]he youngest child's entry into high school may be considered as a change of circumstance for purposes of an alimony review for the Court" had been triggered. These considerations justified the judge's rulings that changed circumstances had occurred, that plaintiff could file a motion for a modification of alimony, and that either party could file a motion to address child support.
Defendant argues the judge should not have made a determination to reduce child support and alimony until he received the updated financial information. Having determined that plaintiff demonstrated a prima facie case of changed circumstances, the judge ordered that the parties produce 2008 financial information and he waited until he received the updated information before calculating modifications to child support and alimony. Consequently, the error, if any, was harmless. R. 2:10-2.
Defendant next contends that the trial judge erred by not conducting a plenary hearing. We disagree. A plenary hearing is only required if a party "clearly demonstrate[s] the existence of a genuine issue as to a material fact." Lepis, supra, 83 N.J. at 159. Defendant did not request a plenary hearing before the January 16, 2009 motion return date, and did not suggest on the return date that a plenary hearing was needed to resolve factual issues. There was no disputed fact about R.R. being emancipated or the youngest child entering high school. Considering those circumstances, there were no disputed facts requiring a plenary hearing.
Defendant also contends that the motion resulting in the January 28, 2009 order was procedurally flawed because it was a limited motion for reconsideration of a previous order, not a motion for the relief granted in the January 28, 2009 order. Defendant misunderstands the nature of the motion. Plaintiff sought reconsideration of a previous order, but also sought other relief. Defendant's arguments concerning procedural deficiencies are without sufficient merit to warrant further discussion. R. 2:11-3(e)(1)(E).
The parties subsequently provided 2008 financial statements and the judge calculated new child support and alimony on August 31, 2009. He ordered plaintiff to pay $168 per week for child support for J.R. and $125 per week in alimony; required defendant to pay $108 per week in child support for S.R.; and denied defendant's motion for reconsideration of the January 28, 2009 order. Defendant argues that the judge erred in denying her motion for reconsideration of the January 2009 order.
The judge denied the motion because it was not filed within twenty days as required by Rule 4:49-2. The time limit in Rule 4:49-2 does not apply to interlocutory orders. See Sullivan v. Coverings & Installation, Inc., 403 N.J. Super. 86, 96-97 (App. Div. 2008); see also Pressler & Verniero, Current N.J. Court Rules, comment 1 on R. 4:49-2 (2011). The error, however, does not require reversal in view of our conclusion that the judge did not abuse his discretion in deciding that changed circumstances warranted a modification of alimony and support.
Defendant next contends the trial court erred by miscalculating plaintiff's business income under the Child Support Guidelines (Guidelines), Pressler and Verniero, Current N.J. Court Rules, Appendix IX to R. 5:6A (2011), and by requiring her to pay support for S.R. She argues plaintiff's business income was miscalculated for child support purposes because plaintiff deducted automobile expenses of $5,116 and entertainment expenses of $415. She also argues that the judge did not consider a $39,840 "loan to officer" as potential cash flow to plaintiff.
The Guidelines have been adopted to assist judges in determining a parent's child support obligation. R. 5:6A. Under the Guidelines, income from self-employment is measured by the gross income minus ordinary and necessary expenses required for self-employment or business operation. Child Support Guidelines, Pressler and Verniero, Current N.J. Court Rules, Appendix IX-B to R. 5:6A at 2455 (2011). Personal income from the operation of a business includes income sources from the business plus "potential cash flow resulting from loans taken from the business." Ibid. Additionally, not all expenses that are considered ordinary and necessary by the IRS are included in the expenses that can be deducted from gross income for purposes of the Guidelines, particularly entertainment and automobile expenses. Ibid.
We will not disturb the factual findings and legal conclusions of the trial judge concerning items that should and should not be included in calculating income for purposes of the Guidelines if the findings are supported by sufficient credible evidence. See Elkin v. Sabo, 310 N.J. Super. 462, 468 (1998). Here, the judge's findings are unsupported by sufficient credible evidence.
For purposes of the Guidelines, plaintiff improperly deducted automobile and entertainment expenses from his company's gross income. That error is harmless because the business would have suffered a loss even if those deductions were excluded. However, the same cannot be said for the "loan to officer."
The Guidelines recognize that personal income from the operation of a business includes all income and potential cash flow resulting from loans taken from the business. In his "Statement of Reasons" supporting the August 31, 2009 order, the trial judge did not discuss the "loan to officer." In a responding certification in his motion papers, plaintiff averred that the "$39,840 flows through my 1120S Form on my tax statement and onto my personal tax return, Schedule E." That information is inadequate to determine whether the loan should be considered as potential cash flow for purposes of the Guidelines.
We express no opinion as to whether the loan should or should not have been included as potential cash flow for purposes of the Guidelines. This issue has to be reviewed and decided by the trial judge. If included for purposes of the guidelines, the loan would have resulted in a significant increase of potential cash flow to plaintiff and may have affected the judge's decision to reduce plaintiff's child support and alimony. Accordingly, we reverse and remand for the judge to determine whether the loan provides additional potential cash flow to plaintiff.
Next, defendant argues the judge erred in requiring her to pay child support to S.R. We conclude that a hearing should have been conducted on this issue before the judge issued the August 2009 order requiring defendant to pay child support. Plaintiff did not formally request child support for S.R. in a notice of motion. In his certification and during the January 2009 oral argument, he stated that S.R. now lived with him and he felt that defendant should have a child support obligation for S.R. The judge denied that request "because there is no proof that [S.R.] resides with the plaintiff full time[,] [and] [d]efendant argues that [S.R.] spends equal time with both parties."
The parties' subsequent certifications as to where S.R. spent most of his time, and most nights, were conflicting. S.R. was commuting to college. Plaintiff stated in one certification that S.R. stayed with him six out of seven nights. Defendant responded that S.R. spent at least three nights with her. Plaintiff submitted a subsequent certification acknowledging that S.R. spent "approximately two (2) days per week" with defendant, but stayed with him the rest of the time. The trial judge accepted plaintiff's second certification that S.R. spent two days with defendant. This was a disputed fact that should not have been resolved on the conflicting certifications and required a hearing as to precisely how much time, day and night, S.R. spent with each party. Accordingly, we remand for a hearing on that issue.
We have considered defendant's remaining arguments and find them to lack sufficient merit to warrant discussion in a written opinion. R. 2:11-3(e)(1)(E).
Affirmed in part, reversed in part, and remanded for further proceedings consistent with this opinion. We do not retain jurisdiction.
© 1992-2011 VersusLaw Inc.