January 9, 2013
ALINA GREEN, PLAINTIFF-RESPONDENT,
STAN GREENBERG, DEFENDANT-APPELLANT.
ALINA GREEN, PLAINTIFF-RESPONDENT,
STAN GREENBERG, DEFENDANT-APPELLANT,
ALINA GREEN, PLAINTIFF-APPELLANT,
STAN GREENBERG, DEFENDANT-RESPONDENT.
On appeal from Superior Court of New Jersey, Chancery Division, Family Part, Bergen County, Docket No. FM-02-1201-08.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued June 5, 2012
Before Judges Yannotti and Kennedy.
We consolidate these appeals which challenge various orders of the Family Part pertaining to post-judgment alimony and child support. In the first appeal, A-4465-09, defendant, Stan Greenberg (Greenberg), appeals Family Part orders entered on February 5 and 11, 2010,*fn1 requiring him to pay plaintiff, Alina Green (Green), $10,000 per month in alimony and $10,000 per month in child support, and setting Greenberg's arrearages for both at $148,000 as of March 1, 2010. In the second appeal, A-0108-10, Greenberg appeals an order entered August 17, 2010, setting his arrearages at $215,770.94, but finding that he only has the ability to pay $7500 per month "toward his [s]pousal [s]upport/[c]hild [s]upport obligation." That monthly obligation was to begin as of August 1, 2010.
In the third appeal, A-0933-11, Green appeals an order entered on September 23, 2011, modifying Greenberg's alimony and child support obligations and requiring him to pay $21,368 per year in alimony, effective January 3, 2011; $235 per week in child support from January 3, 2011, to May 27, 2011; and $18 per week in child support thereafter.
We reverse the orders at issue in the first and second appeals, and remand the matters to the Family Part for discovery, if necessary, and such plenary hearings as may be appropriate. We affirm the order at issue in the third appeal.
We discern the facts from the record.
Greenberg and Green were married and divorced, and married again on March 27, 1999. Two children were born of the marriage. On May 2, 2008, their second marriage was dissolved by a judgment of divorce, which incorporated the terms of a property settlement agreement (PSA) the parties had entered on November 1, 2007. Section II of the PSA, entitled "Alimony and Support of the Wife and Children," stated:
The Husband shall pay to the Wife the sum of $240,000.00 for one year as and for alimony and child support, commencing November 1, 2007, payable in equal monthly payments of $20,000.00 on the first day of each month. The aforesaid payments should be allocated as $10,000.00 in nontaxable alimony and $10,000.00 in child support. Commencing November 1, 2008, the Husband shall pay the Wife no less than $10,000.00 per month, allocated $5,000.00 as nontaxable alimony and $5,000.00 as child support. In the event, however, the Husband earns more than $300,000.00 per year, the Husband shall pay the Wife one-half of any money in excess of said $300,000.00, net of taxes, up to a maximum amount of $20,000.00 per month. The additional sum owed by the Husband shall be retroactive to November 1 of each year, and shall be allocated one-half as nontaxable alimony and one-half as child support.
The PSA also provided that the parties shared joint legal custody of the children and that Green had primary residential custody.
In accordance with his understanding of the PSA, Greenberg paid to Green $20,000 per month from November 1, 2007, and $10,000 per month, of which $5000 was allocated to alimony and $5000 to child support, as of November 1, 2008. In January 2009, however, Greenberg ceased paying the $5000 in child support because the children moved into his home and he had assumed the obligation to pay for the children's private school tuition. The children resided with Greenberg through September 2009, and Greenberg paid their school tuition through Spring 2010.
On November 18, 2009, Green filed a motion to enforce litigant's rights, alleging that Greenberg had, in fact, violated the PSA by failing to continue to pay $20,000 per month after November 1, 2008. On February 5, 2010, following oral argument, the Family Part judge entered the order which is the subject of the first appeal. The judge explained that he "cannot conclude that [Greenberg] has submitted evidence [to support the claim] that [Section II] of the PSA . . . kicks in and automatically lowers" Greenberg's obligation from $20,000 to $10,000 per month. The judge also denied a later motion for reconsideration.
Following our order of July 1, 2010 remanding the matter, the Family Part held an ability to pay hearing over the course of four days and then entered an order on August 17, 2010, which is the subject of the second appeal. The motion judge explained that after considering the testimony, and "acknowledging" Green's lack of discovery, "the [c]court comes to the conclusion and makes factual determinations, at the present time, I believe [Greenberg] has the ability to pay $7,500 per month toward his spousal support and child support obligation." The judge also set arrearages based on the terms of the order of February 5, 2010. Greenberg appealed.
Greenberg thereafter filed a motion before the Family Part for modification of his support obligations, as well as a motion before us to remand to allow consideration of the modification motion. On January 3, 2011, the appeal was temporarily stayed to allow defendant to file a Lepis motion*fn2 to modify his alimony and child support obligations, and to permit the Family Part's consideration of the motion.
Another Family Part judge presided over a plenary hearing which was held over the course of eight days from March 2011 to July 2011. The judge entered an order on September 19, 2011, and thereafter issued an amended order on September 23, 2011, which reduced the amount defendant is obligated to pay in alimony and child support obligations. This order is the subject of the third appeal.
The judge, in a written and well-reasoned opinion, made detailed findings of fact and conclusions of law in support of her order. The judge considered the factors set forth in N.J.S.A. 2A:34-23 and opined, in part:
N.J.S.A. 2A:34-23 sets forth the non-exclusive list of factors a court must consider in making an alimony determination.
1. The Actual Need and Ability of the Parties to Pay
It is uncontroverted that the Defendant was a high wage earner during the marriage, making more than $500,000.00 annually. In 2009, the Defendant's monthly expenses totaled $16,167.00. Since then, his businesses have failed, his bankruptcy petition has been discharged and he is working at a job earning $104,000.00 per year, a reduction in income of over 80%. Likewise, he has downsized his lifestyle. He now reports his monthly expenses to be $3,260.00, a reduction of approximately 80%. While the Defendant has always been a superior wage earner, I am satisfied his earnings have suffered a significant and drastic decrease warranting modification of his alimony obligation.
Given the Defendant's inability to continue to pay the prior alimony award, it is unreasonable for the plaintiff to expect she can maintain the consumptive lifestyle she enjoyed during the marriage.
Currently, the Defendant's gross yearly income is $104,000.00, leaving him after 30% tax withholding with $72,800.00 His bare bones expenses prior to accepting residential custody of one child were $39,432.00. Adding an additional $1,000.00 per month for shelter expenses, his yearly need totals $51,432.00 yearly, leaving an additional $11,368.00 available for alimony to the Plaintiff.
2. The duration of the marriage
The parties were married nine years, but have two daughters, born five and three years prior to the marriage. They have been divorced three years.
3. The age, physical and emotional health of the parties
The Plaintiff is fifty-years-old; the Defendant forty-six-years-old. There are no indications that either party has any emotional or physical health problems . . . .
4. The standard of living established in the marriage and the likelihood that each party can maintain a reasonable comparable standard of living
Neither party can come close to the standard of living established during the marriage.
5. The earning capacities, education levels, vocation skills and employability of the parties
The Plaintiff owns a decorating business and has a real estate license . [Defendant] has the potential to earn far greater than the Plaintiff.
6. The length of absence from the job market of the party seeking maintenance
The plaintiff entered the job market after the divorce . . . .
7. The parental responsibilities for the children
The parties each have residential custody of one child. Both children are teenagers and full-time students.
8. This factor is inapplicable . . . .
9. The history of the financial or non- financial contributions to the marriage by each party including contributions to the care and education of the children and interruption of personal careers or education opportunities
The Plaintiff was the children's primary caretaker during the marriage. She is obligated, per the PSA, to pay the children's private school tuition .
10. . . .
The parties divided their assets at the time of the divorce . . . .
11. The income available to either party through investment of any assets held by that party
Currently, the Plaintiff's assets exceed those of the Defendant. She owns her home, but carries a substantial mortgage. The Plaintiff maintains $50,000.00 in her IRA and $500,000.00 in a foreign bank account.
The Defendant's IRA has been depleted; his remaining assets seized by the bankruptcy trustee. He claims $5,000.00 in assets.
12. The tax treatment and consequences to both parties of any alimony award, including the designation of all or a portion of the payment as a non-taxable payment
The alimony payments are taxable to both.
13. Any other factors which the Court may deem relevant None[.]
In consideration of the aforementioned factors, and the analysis of the parties' needs and ability to pay, the Court awards the Plaintiff an alimony award in the amount of $11,368.00 per year.
The Defendant's child support obligation pursuant to New Jersey Child Support Guidelines for two children shall be $253.00 per week . . . .
Greenberg argues on appeal that the first Family Part judge erred by misinterpreting the PSA, in issuing the February 2010 orders, and by overlooking credible evidence, failing to conduct a plenary hearing and failing to make findings of fact and conclusions of law. We agree.
The relevant language of the PSA provided the following:
The Husband shall pay to the Wife the sum of $240,000.00 for one year as and for alimony and child support, commencing November 1, 2007, payable in equal monthly payments of $20,000.00 on the first day of each month.
The same paragraph further provides that:
Commencing November 1, 2008, the Husband shall pay the Wife no less than $10,000.00 per month, allocated $5,000.00 as nontaxable alimony and $5,000.00 as child support. In the event, however, the Husband earns more than $300,000.00 per year, the Husband shall pay the Wife one-half o any money in excess of said $300,000.00, net of taxes, up to a maximum amount of $20,000.00 per month.
The PSA thus sets forth two distinct timeframes within which Greenberg was required to pay two different amounts for alimony and child support. For the first year of the divorce, which the parties defined as commencing November 1, 2007, and ending November 1, 2008, the PSA required Greenberg to pay $20,000 per month. It is undisputed that Greenberg paid that amount.
Next, the PSA provides for an automatic reduction in Greenberg's support obligations to no less than $10,000 per month commencing November 1, 2008. Under the PSA, Greenberg's obligation would increase beyond that level only in the event his income exceeded $300,000, net of taxes. The terms of the automatic reduction in support were clear and unambiguous, and further, the parties agreed in writing that they both understood the meaning of the terms.
Notwithstanding the clear language of the PSA, however, the judge erroneously concluded that Greenberg was obligated to continue to pay $20,000 per month after the first year of the divorce. The judge thus erred by misinterpreting the plain language of the PSA and, consequently, the orders requiring Greenberg to continue to pay $20,000 per month, and setting arrears based on that figure, after November 1, 2008, must be reversed.
Additionally, the judge set Greenberg's support obligations and fixed arrears at amounts inconsistent with evidence in the record and without a plenary hearing. Greenberg presented evidence that he suffered a significant decrease in his business holdings, and lost nearly all of the resultant business income, which depleted his assets following the divorce. Greenberg's tax returns suggest that his income was not only below the $300,000 mark that would automatically trigger any increase in support, but was also below the level that would have required him to pay $20,000 per month. Green, on the other hand, offered no evidentiary support for her expansive claims that Greenberg was hiding assets and other business income.
We give deference to a trial court's findings regarding alimony if they are supported by the record. Reid v. Reid, 310 N.J. Super. 12, 22 (App Div.), certif. denied, 154 N.J. 608 (1998). Regarding the calculation of alimony in particular, we will not overturn such awards unless we conclude that the trial court "clearly abused its discretion, failed to consider all the controlling legal principles or . . . [are] well satisfied that the findings were mistaken or that the determination could not reasonably have been reached on sufficient credible evidence after considering the proofs as a whole." Heinl v. Heinl, 287 N.J. Super. 337, 345 (App. Div. 1996) (citing Rolnick v. Rolnick, 262 N.J. Super. 343, 360 (App. Div. 1993)).
Despite the deference owed family courts on these issues, it is clear the judge's decision here was in error because he incorrectly interpreted the plain language of the parties' PSA, and his finding that defendant could afford to pay $20,000.00 per month - even though the PSA did not provide for that amount - was not predicated upon findings of fact following a plenary hearing.
We are aware that "not every factual dispute that arises in the
context of matrimonial proceedings triggers the need for a plenary
hearing." Harrington v. Harrington, 281 N.J. Super. 39, 47 (App. Div.)
(citing Adler v. Adler, 229 N.J. Super. 496, 500 (App. Div. 1988)),
certif. denied, 142 N.J. 455 (1995). However, our review of the record
convinces us that the facts relating to Greenberg's diminution of
income required exploration at a plenary hearing. That he may actually
have less income does not necessarily mean he is entitled to a
reduction in alimony. In addition, the judge must consider all of the
other factors related to alimony, including other sources of income,
in making a determination on a motion such as this one. Additional
discovery may be necessary prior to the plenary
hearing, so that all issues can be explored further.*fn3
Given our conclusion, we also reverse the judge's order with
respect to counsel fees and we remand the matter to the Family Part.
In Greenberg's second appeal, A-0108-10, in which he challenges the order of August 17, 2010, Greenberg argues the judge erred because he failed to make specific findings of fact and conclusions of law and, further, the decision was not supported by credible evidence in the record. We agree that the judge failed to make adequate findings of fact and conclusions of law and therefore we cannot ascertain the basis of the judge's ruling. However, in light of our reversal of the orders entered in February 2010, we must also reverse the order of August 17, 2010, because that order was predicated on the earlier orders.
In addition, the judge's failure to make adequate findings of fact and conclusions of law, makes it impossible to determine whether the judge erred in his decision. The failure of the judge to make findings of fact and set forth his conclusions of law violates Rule 1:7-4(a). The critical importance of adhering to the requirements of this rule cannot be overemphasized. Not only is such a failure a disservice to the litigants and the appellate court, Curtis v. Finneran, 83 N.J. 563, 569-70 (1980), but also it interferes with the discharge of our appellate duties.
In the third appeal, A-0933-11, Green argues that Greenberg "dismantled" his business interests for the "purpose of ridding himself of his alimony obligation . . . ." Green tries to support this allegation by stating that Greenberg had "filed for personal bankruptcy" and then "quickly arranged to take a position as a W-2 wage earner . . . ." We reject these arguments.
It is well-established that trial courts have "broad equitable powers . . . to review and modify alimony and support orders at any time." Weitzman v. Weitzman, 228 N.J. Super. 346, 353 (App. Div. 1988). N.J.S.A. 2A:34-23 further provides that in "any matrimonial action . . . the court may make such order as to the alimony or maintenance of the parties . . . as the circumstances of the parties and the nature of the case shall render fit, reasonable and just . . . ." N.J.S.A. 2A:34-23(b) sets forth a non-exhaustive list of thirteen factors that the judge should consider in making any award.
Once the plenary hearing stage is reached, there is no firm rule governing when an existing support obligation has ceased to be "'equitable and fair'"; rather, courts are to weigh several factors dependent on the nature of each case. Lepis, supra, 83 N.J. at 153 (quoting Smith v. Smith, 72 N.J. 350, 360 (1977)). These factors include whether the change in circumstance is temporary or permanent; whether the change was voluntary; whether it was motivated by bad faith or a desire to avoid payment; and whether the change in circumstance renders the former spouse unable to pay. See Larbig v. Larbig, 384 N.J. Super. 17, 23 (App. Div. 2006) (finding a reduction in income to be temporary); Kuron v. Hamilton, 331 N.J. Super. 561, 572 (App. Div. 2000) (finding the movant's good faith to be an "ingredient" to consider); Deegan v. Deegan, 254 N.J. Super. 350, 355 (App. Div. 1992) (finding that a voluntary change such as retirement may sometimes justify a modification).
Although the supporting spouse's income earned through employment is central to the modification inquiry, it is not the only measure of the supporting spouse's ability to pay that should be considered by a court. Real property, capital assets, investment portfolio, and capacity to earn by "diligent attention to . . . business" are all appropriate factors for a court to consider in the determination of alimony modification. Innes v. Innes, 117 N.J. 496, 503 (1990).
As we noted earlier, we will not overturn such awards unless we conclude that the trial court "clearly abused its discretion, failed to consider all the controlling legal principles or . . . [are] well satisfied that the findings were mistaken or that the determination could not reasonably have been reached on sufficient credible evidence after considering the proofs as a whole." Heinl, supra, 287 N.J. Super. at 345. Here, the Family Part's findings are well supported by sufficient credible evidence in the record and will not be disturbed.
Green also argues that the Family Part erred in imputing income to her. She claims that she had been a flight attendant prior to the marriage and that, thereafter, she was "a homemaker." This argument is without merit.
After the parties' divorce, Green earned $97,000.00 as commission working as a real estate broker for two friends in 2008. However, she contends her income as a real estate broker "was sporadic at best and was only reliant on the goodwill of her two friends who just happened to be purchasing expensive apartments at the time." Green testified she did not earn any commissions in 2009 and argues the Family Part abused its discretion by imputing an income of $50,000.00 annually to her.
The trial court's decision to impute income to plaintiff must be upheld if supported by adequate, substantial and credible evidence. Ibid. The trial court made the following findings:
No income was imputed to the Plaintiff at the time of the divorce. Alimony and child support were set at $20,000.00 per month. Her purported monthly expenses in 2009 exceeded that by $7,859.00 [sic] per month. At no point since the Judgment of Divorce would alimony have met her alleged expenses, nor would her alleged expenses have been met with the addition of $98,000.00, her highest income. The Plaintiff could never have funded this lifestyle on what has been divulged to the Court and it is suspect.
The Plaintiff attended college in Russia and worked as a flight attendant before the marriage. She holds a real estate license that she uses to her advantage when buying and selling her own homes or when wealthy friends purchase property. She has been associated with Friedberg Properties in New Jersey and Citi Habitats in New York City. In 2008, she earned $98,000.00 on a real estate commission selling a home for a friend and in 2009, she earned $57,000.00 on another real estate commission. In 2010, she also claimed $21,774.00 income from her work as an interior designer. She also testified that she shops in the US for wealthy friends living abroad and they repay her with gifts.
Ironically, the Plaintiff testified that she can't earn any income from real estate because of the downturn in the real estate market. The credibility of that statement wanes with me, given the fact that she contests the failure of the Defendant's real estate businesses.
Given the Plaintiff's education and ability to generate income from real estate sales, imputation of $50,000.00 per year, an average over three years, is appropriate.
This determination is well supported by evidence in the record and is consistent with our caselaw. See Strahan v. Strahan, 420 N.J. Super. 298, 312 (App. Div. 2008).
The sufficient credible evidence adduced during trial supports the court's decision to impute income to Green in the amount of $50,000.00. The Family Part's decision did not constitute an abuse of discretion and is affirmed.
We have considered Green's other arguments and conclude that they are without sufficient merit to warrant discussion in a written opinion. R. 2:11-3(e)(1)(E).
We reverse the orders at issue in A-4465-09 and A-0108-10, and we remand the matter to the trial court for further proceedings in conformity with this opinion. We affirm the order at issue in A-0933-11.