On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Hudson County, Docket No. FM-09-2617-08.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued September 21, 2011
Before Judges Axelrad, Sapp-Peterson and Ostrer.
In this appeal, defendant seeks reversal of the Family Part judge's order awarding palimony and twenty percent of the property and bank accounts to his former paramour. He argues:
(1) the recent amendment to the Statute of Frauds, N.J.S.A. 25:1-5(h) (Amendment), requiring that palimony agreements be in writing and entered with the advice of counsel, applies to this case; (2) the trial court erred in proceeding with the default hearing the same day it entered default against him for the second time; (3) plaintiff failed to establish the existence of a valid palimony agreement; (4) the palimony award was not supported by sufficient evidence; and (5) the trial court erred in failing to find defendant incompetent. We reject all of defendant's arguments and affirm.
Plaintiff filed a complaint in June 2008 seeking, among other relief, palimony. She alleged that she and defendant had "cohabitated for over twenty . . . years . . . as if they were man and wife[,]" and that during that time "defendant . . . repeatedly promised to care for . . . [her] for the rest of her life, . . . caused her to become financially dependent upon [him], . . . made representations that he would support her, and . . . in fact supported her." She alleged defendant "breached his promises of support" and that she is "now unable to support herself."
Plaintiff served defendant with a copy of the summons and complaint on June 19, 2008, but defendant failed to respond. The court entered default against him on November 17, 2008, and scheduled a proof hearing for January 12, 2009. On December 23, 2008, plaintiff filed a Notice of Application for Equitable Partition, seeking one-half the equity in property located in Bayonne, which plaintiff estimated was valued at $750,000. She also sought $400,000 in palimony as "the present value of support for [her] lifetime[.]"
Judge Maureen P. Sogluizzo scheduled the proof hearing for February 10, 2009, "unless defendant obtain[ed] an attorney to vacate the default." Defendant, along with his attorney, appeared before Judge Sogluizzo on the scheduled date, contesting the entry of default. She entered an order vacating the entry of default and permitted defendant to file an answer. At the same time, she entered a case management order directing the parties to exchange discovery.
On June 18, 2009, Judge Sogluizzo entered an order requiring defendant to have the Bayonne property appraised by July 10, 2009, and complete all discovery by July 31, 2009. At some point subsequent to the entry of this order, defendant's attorney withdrew from the case and new counsel was obtained. However, by October 14, 2009, the new attorney also withdrew his representation. In November 2009, defendant consulted with another attorney but did not retain the attorney. Rather, defendant proceeded to represent himself.
On December 1, 2009, Judge Sogluizzo entered an order finding that defendant violated discovery obligations. As a sanction for the violations, she suppressed the answer defendant filed on February 9, 2009. In addition, she entered default against defendant.
In reaching her decision, Judge Sogluizzo noted that in February 2009, she vacated the entry of default, permitted defendant the opportunity to obtain counsel and file an answer, and since that time, defendant had retained two different attorneys, both of whom had subsequently withdrawn, and defendant had not succeeded in retaining a third attorney. These events, along with his non-compliance with discovery orders, led the judge to conclude: "It's time to stop this. Your case will be dismissed for your failure to comply with the discovery requests that have been made three times upon you."
Judge Sogluizzo advised defendant that the default hearing would be conducted on January 27 and 28, 2010. Additionally, she advised defendant that at the proof hearing, he would be permitted to "ask questions on cross-examination only of the witnesses and of any experts that are put in place" by plaintiff. The judge once again ordered defendant to provide an appraisal of the Bayonne property within two weeks; otherwise, plaintiff would be permitted to obtain her own appraisal.
Because plaintiff's witnesses were present, she requested that they be permitted to provide testimony at that time. Judge Sogluizzo initially refused the request, stating that she could not "proceed on a default proceeding without giving [plaintiff] the opportunity to alert [defendant] as to what his default is about." In response, plaintiff argued that defendant had previously been given notice, and specifically referenced the December 23, 2008 notice to defendant seeking equitable partition. Since she continued to seek this relief, plaintiff argued that her notice requirements had been satisfied. The judge agreed and permitted plaintiff's witnesses to testify.
Plaintiff produced four witnesses, all of whom provided testimony that the parties presented themselves as married, including plaintiff wearing a wedding ring, being together at such events as social gatherings, shopping, and church. Defendant cross-examined the witnesses. However, his questioning consisted primarily of accusing the witnesses of lying.
Trial resumed on March 8, 2010, and continued through the next three days. Plaintiff, a native of Poland, testified she met defendant in 1988, upon arriving in the United States. They commenced cohabitating shortly thereafter. Defendant introduced her as his wife. She introduced into evidence cards and other documents people had addressed to them as a married couple. They purchased the Bayonne property in 1994 for $115,000. It was a cash transaction and plaintiff contributed $13,000 towards the purchase price. The property consisted of two houses on one lot, one of which had four apartments, and the other had three apartments. The couple lived in one apartment with their two children and rented out the other units. Defendant undertook a significant amount of renovations and financed the repairs, but they decorated the apartment together and shared in its management in all respects.
Plaintiff also worked outside the home from time to time as a caretaker for the elderly, a housekeeper, and a waitress. As a caretaker, she earned "about [$]400 to $460 a week[,]" which sometimes necessitated her staying overnight for several days at a time with a patient. Her earnings were spent on "clothing, food for the children and . . . defendant and things that [they] needed for the house[.]" Her annual income between 2001 and 2008 ranged from $8706 to $23,557. Other than the income from the rental units, defendant's only source of income was Social Security.
According to plaintiff, defendant "promised to support [her]" and planned to marry her, which is why he divorced his first wife. They "were supposed to spend [their] lives together till the end of [their] lives." Plaintiff stated she did not know what happened to defendant, but something occurred that forced her to move out. They maintained joint bank accounts, and in 2003, he completed an Affidavit of Support on her behalf in connection with immigration proceedings because she had been living in the United States illegally.
The couple had two children together. When each child was born, however, they listed defendant's former spouse as their mother so that the children would be covered on defendant's medical insurance. In 2000, both parties underwent paternity testing to confirm they were the children's biological parents and later had the children's birth certificates changed to accurately reflect plaintiff as their biological mother. Plaintiff described herself as the primary caretaker of the children; however, defendant cared for them while plaintiff was working. The couple also shared responsibility for household chores. Plaintiff obtained legal status on March 3, 2010.
Plaintiff testified she moved out of the apartment with the children in April 2008 because she was "afraid." She explained defendant "started to speak nonsense," including saying their daughter was his sister, their son was somebody else's child, and plaintiff slept with her own father. Defendant took another paternity test in 2009 that once again confirmed he was the biological father of both children. Plaintiff testified that she was now living in an apartment with her two children and working part-time at ShopRite earning $8 per hour.
Plaintiff's counsel called defendant as a witness and primarily questioned him regarding his finances. With the assistance of a Polish interpreter, defendant denied that plaintiff had contributed money towards the purchase of the Bayonne property. Although plaintiff had produced documents establishing that defendant, at one point, had $334,000 in various bank accounts, he testified that he lost all the money gambling in Atlantic City.
After four days of trial in March, it recessed and resumed on June 21, 2009, with plaintiff's counsel continuing direct examination of defendant. Plaintiff's counsel completed direct examination the next day, after which Judge Sogluizzo instructed defendant as follows:
Mr. Wykowski, again, this is your time to cross-examine yourself regarding testimony that you've given at [plaintiff's counsel]'s direction. Is there anything about what you told me through her questions that you wish to further explain[,] and I would prefer that you ask yourself a question and then answer it.
Notwithstanding the judge's instruction, defendant's testimony on cross-examination was largely responsive to questions posed to him by the judge based upon defendant's direct testimony. The following day, plaintiff briefly provided rebuttal testimony before he and plaintiff's counsel made closing arguments to the court. Judge Sogluizzo reserved decision and directed the parties to return to court on June 30, 2009.
The parties appeared as ordered, and the judge rendered a decision from the bench, followed by an order of that same date. She briefly noted that the Statute of Frauds had recently been amended to provide that a palimony agreement, in order to be enforceable, must be in writing and entered into with the advice of counsel, but found that "[t]his case far preceded" the effective date of the Amendment. With respect to plaintiff's palimony claim, she found the parties cohabited for twenty years, they "lived in a "marriage[-]type relationship[,]" and defendant's testimony to the contrary was "incredible."
Judge Sogluizzo credited plaintiff's testimony that defendant told her they bought the Bayonne property for their retirement and would "be together until something happens to one of [them]." She concluded that valid consideration for the promise existed in that plaintiff "for [twenty] years . . . helped prepare . . . meals[,] . . . shared the responsibility of the home that they lived in[,] . . . cleaned, . . . did laundry[,] . . . raised their two children[,] . . . [and] took care of the tenants in the building." The judge found that plaintiff left their home after defendant started "acting strangely" by denying his paternity of their two children, causing plaintiff to become "fearful, not only for herself but for the well[-]being of her children." Finally, she found that economic inequality existed in favor of defendant because defendant "had all of the money in his name and [plaintiff] trusted that he would take care of her."
Judge Sogluizzo awarded plaintiff $483,832.80 in palimony. Based upon plaintiff's testimony, she found plaintiff needed $3412 per month "to maintain her status quo" and that she was earning only $1212.60 each month, creating a monthly shortfall of $2200. The judge found plaintiff had a life expectancy of twenty-six years and eight months, so that the total amount of money necessary for her support, over the remainder of her life, equaled $707,520, which had a net present value of $483,833.
Judge Sogluizzo also found that the Bayonne property and joint bank accounts were devisable as joint ventures and awarded plaintiff: (1) twenty percent of the value of the property ($90,000) based on her contribution to the down payment and her earnings towards upkeep of the home, and (2) twenty percent of the established value of the bank accounts ($66,800). The total award to plaintiff was $640,633. The judge also allowed plaintiff and the children to return to the Bayonne home and deducted the value of that property, $450,000, from the judgment awarded.
On July 12, 2010, defendant, represented by yet another attorney, filed a Notice of Appeal. Four days later, he filed a motion before the Family Part judge seeking a stay of the June 30, 2010 order pending appeal. Plaintiff filed opposition to the motion, as well as a cross-motion to enforce the June 30, 2010 order. Plaintiff also sought the imposition of monetary sanctions in the event defendant failed to pay court-ordered counsel fees within five days of the court's order. On August 20, 2010, Judge Sogluizzo entered an order requiring defendant to surrender his American passport to the court by August 23, 2010, and to pay plaintiff's counsel $13,000 in legal fees and $8800 for plaintiff's support by August 31, 2010.
Defendant's motion for a stay was adjourned to September 10, 2010. On that date, defense counsel advised the judge that defendant had been evaluated by Dr. Peter M. Crain, a psychiatrist, who concluded that defendant "suffers from dementia[,]" causing an inability "to understand the [c]court proceedings." The judge noted that defendant's motion before the court sought a stay pending appeal "based upon the decision of the [c]court which [defense counsel] believe[d] was against the weight of the evidence." She then asked defense counsel if he was "arguing a new motion to set aside the trial based upon [defendant's] incompetency[.]"
Defense counsel requested a "continuance to get the medical report and to amend [the] motion . . . based on the newly discovered evidence" of defendant's mental condition. The judge gave defendant twenty-one days to file such a motion. However, based upon defendant's argument of incompetency, she required defense counsel to serve as a receiver to protect the financial assets.
Judge Sogluizzo entered an order: (1) adjourning the motion for a stay of judgment for twenty-one days; (2) ordering defendant's attorney to "take control of [d]efendant's financial affairs and pay all his bills" in order to "safeguard all of
[d]efendant's assets and person until proof has been submitted that [d]efendant is incompetent"; and (3) giving defendant until October 1, 2010, to file a motion for incompetency along with a supporting report.
On October 26, 2010, defense counsel informed the trial judge that he had been advised by the Appellate Division that his competency motion could not be heard by the trial court unless we remanded the case. Several motions were pending before us with a November 14, 2010 filing date. In the interim, defendant also obtained a full report from Dr. Crain. Defense counsel explained to the judge that once we remanded the case, he did not intend to argue that defendant was wholly incompetent in the sense that he was unable to manage his affairs. Rather, he intended to argue that defendant lacked the ability to "assist himself or his attorneys during the course of [the] legal proceeding."
Judge Sogluizzo conducted the hearing on October 26, 2010 and, at its conclusion, entered an order of the same date, which, in pertinent part, (1) denied defendant's motion for a stay of the June 30, 2010 order; (2) required defendant to immediately pay $190,633 to plaintiff or post a bond for that amount; and (3) required defendant to pay plaintiff $2200 per month, effective September 1, 2010, "until this matter is resolved."
Also on October 26, 2010, defendant filed a motion with the Appellate Division seeking a remand to the trial court for a determination as to his competency. On November 22, 2010, we entered an order granting defendant's motion for a temporary remand to determine his competency. We denied plaintiff's cross-motion for counsel fees and costs without prejudice.
On December 2, 2010, defendant sought leave to file an emergent motion with the Appellate Division, seeking a stay of the June 30, 2010 order "until the competency hearing is decided at the trial level[.]" By order dated December 3, 2010, we denied this motion, with instructions to defendant to "make a new app[lication] to [the] trial court" as the "October 26, 2010 order is ambiguous on whether a stay is granted as to the entire order or not."
On December 14, 2010, plaintiff filed a motion for an order to show cause, which the trial judge converted to a motion to enforce litigant's rights, returnable January 7, 2011. She denied defendant's motion for a stay, finding "no immediate or irreparable harm to people or property."
On January 7, 2011, Judge Sogluizzo entered an order requiring defendant to either immediately pay $190,633 to plaintiff's attorney, to be held in a trust account, or post a bond for that amount, to be held until after the competency hearing. Additionally, the judge ordered defendant to pay $13,800 in outstanding support to plaintiff and to continue the $2200 monthly support payment. That same day, she entered an order denying defendant's motion for a stay of the June 30, 2010 judgment.
Also in January, plaintiff filed a Notice in Lieu of Subpoena seeking an order directing defendant to produce pertinent financial information, contact information for tenants of the Bayonne property "from December 2009 to the present[,]" and an accounting of all rents collected since December 2009. Defendant filed a motion to quash the subpoena on January 25, 2011.
The competency hearing took place on January 31, 2011. There was some debate as to whether the matter should proceed under Rule 3:12 or Rule 4:86-1 to -12. Judge Sogluizzo ultimately concluded Rule 4:86-2 applied and found defendant failed to meet his requirement of submitting the affidavits of "two physicians . . . or . . . of one . . . physician and one licensed practicing psychologist." The judge, nonetheless, permitted defendant to present the testimony of Dr. Crain.
Dr. Crain testified that he examined defendant in September 2010 "to determine whether or not he was mentally competent to understand the proceedings against him, assist in his own defense in the trial that took place from December 1, 2009[,] through June 23, 2010." He concluded defendant was "incompetent mentally[,] [i]ncapable of preparing an adequate defense to the palimony [claim], and representing himself in the trial." He opined that defendant suffered from a "delusional disorder" that contributed to his belief that he was not the biological father of his children and his additional delusion that plaintiff and the children attempted to poison him. With respect to the trial, Dr. Crain expressed the opinion that defendant understood the roles of the attorneys and the judge, but was "not capable of grasping the distinction between questioning the witness and giving his own personal testimony."
After the parties concluded their direct and cross-examinations of Dr. Crain, the judge questioned the doctor regarding his opinions related to defendant's competency. Dr. Crain opined that defendant "can handle his affairs" and "does not require a guardian to take care of his affairs."
At the conclusion of Dr. Crain's testimony, plaintiff urged the judge to dismiss the competency proceeding. Plaintiff argued defendant had failed to provide either two physicians or one physician and one psychologist to testify as to his competency. Judge Sogluizzo granted plaintiff's application, noting Dr. Crain did not express the opinion that defendant was incapacitated, as defined by N.J.S.A. 3B:1-2. She also granted plaintiff's application for counsel fees in connection with the proceeding.
On February 7, 2011, the judge entered an order declaring that defendant's motion to quash was now "moot." The order also placed a lien on defendant's vehicles as security for the $26,373 in support owed to plaintiff and the children.
On February 22, 2011, the judge entered an order incorporating, into its most recent order, the terms of the September 10, 2010 order, in which she appointed an attorney-in-fact for purposes of transferring the Bayonne property. By a separate order entered that same day, the judge ordered defendant to vacate the Bayonne property within seven days and turn over all rents received for January and February 2011. She ordered plaintiff to notify the tenants that she owned the property. Also on February 22, 2011, the judge issued an arrest warrant for defendant based upon his failure to comply with her order directing him to pay the $26,373 by February 22, 2011.
On March 3, 2011, defendant filed a motion in the Appellate Division to stay the appellate proceedings due to his incarceration. We denied defendant's motion by order dated April 5, 2011. By separate order, we denied plaintiff's request for counsel ...