On appeal from Superior Court of New Jersey, Chancery Division, Family Part, Union County, Docket No. FM-20-000178-07.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Telephonically argued February 3, 2011
Before Judges Fuentes, Gilroy and Ashrafi.
This appeal from post-judgment orders requires us to determine whether the Family Part erred in reforming a provision for equitable distribution in the parties' divorce settlement agreement on the ground of mutual mistake. The parties had agreed that plaintiff Terry Andrews would promptly receive the proceeds from the sale of stock held in a privately-owned bank. Two years later, the sale still had not occurred, and the stock had no market or discernible value.
Defendant Clifford Andrews III appeals from an order of the Family Part reforming the settlement agreement and requiring that he pay half the designated value of the bank stock to plaintiff, plus interest from the time she filed the post-judgment motion. He also appeals from an order denying his motion for reconsideration and requiring that he pay attorney's fees. Finding no legal error or abuse of discretion in the Family Part's orders, we affirm.
Plaintiff-wife and defendant-husband were married in 1988 and divorced in 2007.*fn1 They have four children, all minors at the time of the divorce. During the marriage, they enjoyed a prosperous lifestyle. Their 2005 income tax return listed more than $3,000,000 in earned and unearned income for the year.
Husband's Case Information Statement (CIS) filed in 2007 reported total gross assets of nearly $19,000,000. Wife's CIS listed joint monthly expenses of $44,000. The divorce required disposition of numerous assets acquired during the marriage, including the marital home, a beach house, several vehicles, and many stocks, mutual funds, and investment accounts.
With the aid of their attorneys, the parties entered into a Support and Property Settlement Agreement, which was in turn incorporated into a Dual Final Judgment of Divorce entered on May 23, 2007. The settlement agreement granted to Wife sole legal and physical custody of the four children, and to Husband liberal parenting time. Several paragraphs of the agreement explicitly provided that equitable distribution of the parties' assets was intended to substitute for any obligation of Husband to pay child support or alimony. With the exception of future college expenses and unreimbursed medical expenses of the children, Husband was expressly relieved from any current or future application for child support or alimony based on an understanding that the assets distributed to Wife would provide the income she needed to maintain the children's and her economic status and lifestyle.
Paragraph twenty-seven of the agreement listed eighteen accounts and securities with a total value of more than $4,100,000 as assets to be retained by or conveyed to Wife exclusively. Among the eighteen assets was a listing for 62,000 shares of stock with a stated value of $1,085,000 in privately-owned Lydian Bank. Two notations accompanied the designation of the asset: the words "sale directed on 5-18-07" written alongside the listing, and a footnote that stated "Salesman has been directed that the proceeds be promptly wired to the Wife." None of the other listed assets included any similar notation or footnote.
Two years after the divorce, the parties disputed Husband's alleged failure to reimburse some medical expenses of the children. In July 2009, Wife filed a motion to enforce litigant's rights. Besides seeking medical reimbursement and other relief, Wife's motion sought an order: "Enforcing ¶ 27 of the parties' Agreement and directing defendant to immediately cause the sale of the Lydian Bank stock, which sale he represented was directed on May 18, 2007." Husband opposed the motion, declaring that he had fulfilled his obligation under the settlement agreement and that the Lydian Bank stock had lost its value in the recent economic downturn.
Oral argument was held on the motion, and subsequent attempts to mediate a resolution failed. After several adjournments, the Family Part held an evidentiary hearing in April 2010 "limited to the issue of the Lydian Bank stock." Three witnesses testified - Wife, Husband, and William Decker, who was the president of Lydian Bank at the time of the divorce.
Wife testified it was her understanding at the time of the settlement agreement that she would be receiving two homes and $4,000,000 in liquid assets. She stated she and her attorneys had determined she needed that amount in liquid assets to continue supporting herself and the four children. As to the Lydian Bank stock, she understood she would be getting proceeds from the sale of that stock rather than receiving the stock itself. She "believe[d] that the sale had been directed[,] past tense," and she was "expecting to receive proceeds." She testified the $1,085,000 value of the stock was taken from a statement of Lydian Bank reporting the value of their shares as of the end of 2005.
Wife did not recall a telephone call being placed during the settlement meeting to William Decker regarding sale of the bank stock. She had not spoken to Decker on that date or at any later time about the sale. She testified that once she became aware that the stock had not been sold, she spoke to an investor relations representative at the bank sometime in June or July 2007. The representative advised her the stock would "be put on the sell list."
The stock remained unsold at the time of the hearing three years after the divorce. Wife testified she did not pursue the matter earlier because the settlement agreement was intended to be "in stone" and she did not think she could "go back to court." When she approached her attorney about the medical ...