July 11, 2011
MAUREEN BRADY-ROSENSTRAUCH, PLAINTIFF-APPELLANT,
ROBERT ROSENSTRAUCH, DEFENDANT-RESPONDENT.
On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Essex County, Docket No. FM-07-2459-07.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted November 30, 2010
Before Judges Carchman and Waugh.
Plaintiff Maureen Brady-Rosenstrauch*fn1 appeals from certain provisions of a final judgment of divorce dated December 10, 2009. She asserts that the judge failed to make adequate findings of fact and erred in the distribution of property, award of child support and alimony, improperly established a quantum of life insurance coverage and failed to set forth certain criteria for emancipation as well as exemptions. We affirm in part, reverse in part and remand for further proceedings.
We adduce the following facts from the record.
Plaintiff and defendant, Robert Rosenstrauch, were married in 1989. Two children were born of the marriage, Kara and I.R.*fn2
Plaintiff is a freelance graphic designer, and received an associate's degree from the Academy of Art College in San Francisco in the late 1970s. Plaintiff recently started an online degree program in the hopes of obtaining a permanent position. Defendant, who has a Bachelor of Science degree, previously worked in the construction renovation business. In the mid-90's, defendant became a real estate appraiser and owns and operates his own business.
Kara, who was nineteen years old at the time of the trial, had graduated from high school and attended college for one semester. She left college and began working at a restaurant.
Both parties agreed that Kara planned to attend community college, and I.R. would attend college after high school.
Early in the marriage, the parties agreed that after they had children, plaintiff would stay at home and start her own business. They lived in a rented house, which they purchased in 1995. The down payment on the house was $25,000, $15,000 of which came from plaintiff and $10,000 from defendant's mother. The house is currently mortgaged for approximately $117,000. The mortgage payment on the house was $2316 per month, which defendant paid. Defendant also paid other monthly bills, including electricity, gas, water, sewer. Defendant's total monthly payment was $3288. According to plaintiff, she paid for cell phones, transportation costs, and personal expenses totaling approximately $9000 per month. From 1995 to 2002, a tenant rented the first floor, but when the tenant moved out, the parties occupied the entire house. Plaintiff now lives upstairs, and defendant lives downstairs.
After the birth of their children and consistent with the parties' marital plan, plaintiff stayed at home and worked approximately twenty-nine hours per week. The parties began having marital problems in 1995, and eventually separated in March 2007. In May 2007, plaintiff filed a complaint for divorce.
From 2003 to 2006, plaintiff reported the following yearly income: $39,950 in 2003, $39,884 in 2004, $57,424 in 2005, and $67,664 in 2006. During the same years, defendant reported the following income: $89,985 in 2003, $88,104 in 2004, $99,947 in 2005, and $104,592 in 2006. In 2007, plaintiff filed a separate tax return with a gross income of $62,368. The five-year average reported income for plaintiff was $53,458, and $92,411 for defendant.
According to plaintiff, during the marriage, the parties made independent financial decisions. Plaintiff opened her own checking account in 1996. Prior to that time, plaintiff and defendant had always shared a joint account. After 1996, plaintiff's only contribution to the joint finances was the inheritance from her mother, which she deposited in a joint savings account.
The parties maintained two joint Bank of America accounts: a savings and a checking account. Defendant also opened a third money-market savings account with $8210 from the parties' joint savings account. The parties had approximately $25,000 in their joint savings account when plaintiff's mother died. Plaintiff inherited approximately $240,000 in two parts: an annuity and life insurance payment first, and the proceeds for the sale of the mother's home a few months later.
The first portion of the inheritance was spent on income taxes, funeral bills, home improvements, two family vacations, and two IRAs, one for each party, in the amount of $5000 each. The remaining funds, approximately $55,000, were placed in a Raymond James investment account. Plaintiff noted that, at a status conference, the judge "spontaneously" ordered the fund liquidated and divided pendente lite, without fact-finding, to fund Kara's college and defendant's counsel fees.
The second portion of the inheritance was used to purchase two "CollegeAccess 529" funds: one for $60,000 and one for $40,000. Plaintiff was designated "owner" of both, and indicated that these accounts were college funds for I.R. and Kara.
At the two-day trial, the parties were the only witnesses. The trial court first settled the custody issue, which is not before us on appeal. Second, the court concluded that the parties were to equally divide all marital assets. The court ordered that each party retain their Raymond James IRAs. The court stated, "With regard to the Plaintiff's Roth IRA, whatever funds are remaining in it are to be divided between the parties on a 50/50 basis."
The court also concluded that the college accounts were exempt from equitable distribution, and that the joint account was to be equally divided. The court denied plaintiff's request for reimbursement from the prior division of the Raymond James account.
With regard to child support, the court calculated that the guidelines recommended that plaintiff should pay defendant $559 per month. However, the trial court did not attach or include the worksheet used in the order. The court also ordered defendant to pay $600 per month to plaintiff in alimony. Finally, the court denied counsel fees.
A supplemental order, dated April 13, 2010, ordered each party to obtain life insurance in the amount of $500,000. The order also stated that "each party shall be responsible for his/her own health insurance."
On appeal, plaintiff asserts that the judge failed to make findings of fact, included plaintiff's Roth IRA despite an agreement between the parties that each was to keep their respective IRAs, failed to consider that the CollegeAccess 529 accounts were exempt and not subject to equitable distribution, ordered an inadequate amount of spousal support, failed to include a child-support guidelines worksheet with the final judgment, failed to make findings regarding counsel fees, failed to set forth the emancipation events for health insurance, ordered excessive life insurance and omitted the exemptions from the final judgment.
"Trial judges are under a duty to make findings of fact and to state reasons in support of their conclusions." Heinl v. Heinl, 287 N.J. Super. 337, 347 (App. Div. 1996); R. 1:7-4. "'Meaningful appellate review is inhibited unless the judge sets forth the reasons for his or her opinion.'" Strahan v. Strahan, 402 N.J. Super. 298, 310 (App. Div. 2008) (quoting Salch v. Salch, 240 N.J. Super. 441, 443 (App. Div. 1990)). "Naked conclusions do not satisfy the purpose of R. 1:7-4. Rather, the trial court must state clearly its factual findings and correlate them with the relevant legal conclusions." Curtis v. Finneran, 83 N.J. 563, 570 (1980).
"The absence of adequate findings . . . necessitates a reversal. . . ." Heinl, supra, 287 N.J. Super. at 347. "We ordinarily remand to the trial court to make findings of fact if the trial court failed to do so." Strahan, supra, 402 N.J. at 310. However, if the trial court's findings of fact are supported by substantial credible evidence on the record, this court is bound by that decision. State v. Elders, 192 N.J. 224, 243 (2007).
We easily dispose of some of the issues raised. In reference to CollegeAccess 529 accounts, the judge made adequate findings that these were not exempt from equitable distribution even though received from plaintiff's inheritance. The judge found that the funds were comingled. We find no basis to intervene as the judge's findings were based on adequate support in the record. Elders, supra, 192 N.J. at 243.
We reach the same result regarding counsel fees. While the judge did not explore the issue at length, we are satisfied that the judge's denial of counsel fees was supported by the facts adduced at the hearing.
As to the failure of the judge to include a child support guidelines worksheet, Rule 5:6A requires the filing of the worksheet with the order. On remand, the worksheet shall be provided.
In addition, plaintiff claims that her Roth IRA was distributed despite an agreement to the contrary. Our review of the record fails to disclose any meaningful discussion of plaintiff's Roth IRA during the hearing, and the judge made no finding as to this IRA other than a brief mention that it should be divided equally. On remand, plaintiff may move to modify the judgment as to this asset, and absent a challenge to the application, the judge shall amend the judgment accordingly. If there is a disagreement as to the merits of plaintiff's claim, the judge may hold a hearing to resolve the issue.
We now address the issue of the alimony. N.J.S.A. 2A:34-23(b) sets forth the relevant factors that must be considered in awarding alimony. In awarding alimony, courts must consider the standard of living enjoyed by the parties during the marriage. See Crews v. Crews, 164 N.J. 11, 24 (2000) (noting that the "general considerations are 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"). See also Cox v. Cox, 335 N.J. Super. 465, 472-73 (App. Div. 2000). Although the judge reviewed the relevant statutory factors, the basis for a $600 per month alimony award is unclear. Together with the other obligations imposed on plaintiff such as child support as well as health insurance and life insurance, the award of $600 may be illusory. In essence, the award is a conclusion without explanation or reasons other than the reference to the statutory considerations. An award must consider, among other things, the disparity in income as well as the assets available to the parties. While the equitable distribution was based on an equal division of assets, some of those assets no longer existed. On remand, the judge should consider and set forth in detail the relative financial positions of the parties and how that impacts on the award. We recognize that the judge made findings as to the statutory factors. Yet, that is not sufficient. On remand, the judge shall perform a financial analysis regarding the award.
Plaintiff also challenges that portion of the April 13, 2010 post-judgment order*fn3 that requires the parties to "obtain life insurance in the amount of $500,000 to cover his/her respective alimony/child support obligation."
A court may order the maintenance of life insurance as a means of securing both alimony and child support. N.J.S.A. 2A:34-25; Konczyk v. Konczyk, 367 N.J. Super. 551, 557 (Ch. Div. 2003), aff'd o.b., 367 N.J. Super. 512 (App. Div. 2004).
The quantum of life insurance, however, must bear some relationship to the amounts secured. Here, the judge ordered that both parties maintain $500,000, yet their respective obligations differ both in length of obligation and potential exposure for payment. Defendant is obligated to pay permanent alimony to plaintiff in the amount of $600 per month or $7200 per year. Plaintiff is obligated to pay child support in the amount of $559 per month or $6708 per year; however, the child support obligation is limited by the age and status of the children. Kara is now 21 and her educational status is uncertain. I.R. is now 17, and the parties' parenting time with him is likewise unsettled. As to the imposition of a life insurance obligation on plaintiff, we fail to discern the basis for imposing a requirement that she maintain $500,000 in insurance. Even assuming that the judge considered college expenses, some of the expenses have been accounted for; nevertheless, the child support obligation, which conservatively may be extant for another five to seven years, does not approximate the ordered amount.
On remand, the judge should revisit the quantum of life insurance required to be maintained by plaintiff.
In addition, plaintiff correctly notes that the dependant exemptions should be addressed and resolved by the judge on remand. Absent agreement by the parties, the judge should determine, as a matter of equity, which parent should have the benefit of the dependant exemption.
Finally, we disagree with plaintiff that the judge was obligated to "make factual findings, discussion and explanation of emancipation of the children and its definition." Emancipation operates as a matter of law and is fact-sensitive depending on the children's circumstances. See Filippone v. Lee, 304 N.J. Super. 301, 308 (App. Div. 1997) (noting the "well-settled principle" that "[i]n the end the issue [of emancipation] is always fact-sensitive"). We find no fault with the judge's order to maintain health insurance without further explanation as to when it terminates. That determination shall abide the children's circumstances.
We affirm in part, reverse in part, and remand for further proceedings consistent with this opinion. We do not retain jurisdiction.