October 16, 2013
ROBERT E. BUTLER, Plaintiff-Respondent/ Cross-Appellant,
TRACEY H. BUTLER, Defendant-Appellant/ Cross-Respondent.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Argued September 10, 2013
On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Essex County, Docket No. FM-07-1035-06.
Patrick T. Collins argued the cause for appellant/cross-respondent (Franzblau Dratch, attorneys; Mr. Collins, on the brief).
Julie L. Kim argued the cause for respondent/cross-appellant (Cohn Lifland Pearlman Herrmann & Knopf LLP, attorneys; Joshua P. Cohn, of counsel and on the brief; Ms. Kim, on the brief).
Before Judges Alvarez and Carroll.
Defendant Tracey H. Butler appeals from a March 26, 2012 Family Part order modifying child support payable by plaintiff Robert E. Butler, and the subsequent denial of reconsideration of that order. For the reasons that follow, we vacate the child support modification, remand for a plenary hearing to be conducted after a ninety-day discovery period, and do not retain jurisdiction.
Plaintiff and defendant were divorced on April 5, 2007, at which time their property settlement agreement (PSA) was incorporated into the judgment. Plaintiff, who had previously earned over $500, 000 annually, was then between jobs. Nevertheless, he agreed in the PSA to pay defendant $3000 monthly in support for the parties' three children, in addition to contributing to certain enumerated expenses. Plaintiff works in foreign exchange, while defendant is a self-employed interior decorator.
On August 20, 2008, the parties entered into a consent order which recognized plaintiff's ongoing difficulties in securing employment comparable to that which he held during the marriage. The consent order reduced plaintiff's child support obligation to $1500 per month effective May 1, 2008, based on plaintiff's reduced wages of $125, 000 annually. It also provided:
In the event Plaintiff realizes in excess of $125, 000 in a given year, Plaintiff shall pay additional child support to Defendant directly and not through Probation, in accordance with a schedule to be agreed upon by the parties in a separate Order.
The parties never agreed upon a "schedule" or a "separate Order."
Although plaintiff disputes this claim, defendant alleges that she did not learn that his earnings exceeded the $125, 000 threshold until approximately November 2011 when she filed a motion to compel reimbursement of certain child support expenses. It is her position that she was aware that plaintiff had finally secured better employment, but that he did not disclose that his earnings exceeded the $125, 000 benchmark.
The judge who decided the motion increased plaintiff's monthly child support obligation by $500 effective November 14, 2011, the motion filing date, bringing plaintiff's total obligation to $2000 monthly. Partial discovery of plaintiff's financial situation, however, had revealed that he earned $150, 000 starting in November 2009, at least $200, 000 in 2010, and approximately $314, 000 in 2011. The judge heard oral argument on defendant's original application but refused her request for a plenary hearing. No oral argument was conducted on defendant's reconsideration motion.
The entirety of the judge's findings on the child support modification is as follows:
The husband was unemployed longer than the parties anticipated so on August 20th, 2008, there was a consent order which adjusted the child support effective May 1, 2008, which was reduced to $1500 per month effective May 1, 2008, which brought Plaintiff current with child support payments through August 31st, 2008. And those $1500 per month were to be payable to the Essex County Probation Department directly.
It states, ["]In the event Plaintiff realizes in excess of 125, 000 in a given year Plaintiff shall pay additional child support to Defendant directly and not through probation in accordance with a schedule to be agreed upon by the parties in a separate order.["] That schedule was never agreed upon in any separate order.
So along comes an application now submitted by the [defendant] for increased child support which was filed November 14th, 2011, and the [defendant] is arguing that she's entitled to additional child support retroactive even to the years of 2010 because the husband earned income in excess of [$125, 000] in 2010 and certainly in 2011 when he made $314, 000.
The husband opposes that application saying that he did disclose income to the wife. There was no notice of this request in the notice of motion and there was no --nothing set forth in the agreement as to who initiated the process. No schedule was ever agreed upon.
Both the consent order and the property settlement agreement don't talk about --excuse me. There's been no separate order that was agreed upon in the schedule. Court will increase the child support, but it will be as of the date of this application which is November 14th, 2011. The Court will increase the child support award to $2, 000 per month, effective November 14th, 2011. In addition thereto the defendant -- excuse me, I keep interchanging the plaintiff and the defendant -- the husband will be responsible for paying $375 a month towards the vehicle and the insurance.
As a general rule, "findings by the trial court are binding on appeal when supported by adequate, substantial, credible evidence." Cesare v. Cesare, 154 N.J. 394, 411-12 (1998). Appellate courts should "exercise [their] original fact finding jurisdiction sparingly and in none but a clear case where there is no doubt about the matter." Rova Farms Resort, Inc. v. Investors Ins. Co. of Am., 65 N.J. 474, 484 (1974). The factual findings and legal conclusions of the trial court should not be disturbed unless they are "so manifestly unsupported by or inconsistent with the competent, relevant and reasonably credible evidence as to offend the interests of justice." Fagliarone v. Twp. of N. Bergen, 78 N.J.Super. 154, 155 (App. Div.), certif. denied, 40 N.J. 221 (1963).
As a threshold matter, we are satisfied that the judge erred in determining the date from which increased payments were due as the motion filing date. There is no prohibition against a retroactive increase of a support order. Keegan v. Keegan, 326 N.J.Super. 289, 291 (App. Div. 1999). Moreover, here the parties had entered into a contract in which they defined the triggering event for modification. That date should have been used in calculating arrears.
"It is well established that matrimonial agreements are basically contractual in nature." Barr v. Barr, 418 N.J.Super. 18, 31 (App. Div. 2011). They should be interpreted fairly and in a common-sense fashion. Ibid. (citing Hardy ex. rel. Dowdell v. Abdul-Matin, 198 N.J. 95, 103 (2009)). Simply stated, the fair and common-sense interpretation of the language in the consent order requires that the date for retroactive modification be fixed as of the time plaintiff commenced earning in excess of $125, 000 annually. Thus the modification date should have been November 2009, when plaintiff's salary increased beyond the $125, 000 mark. We cannot discern any reason from the record that another date should have been employed, and the judge did not explain his decision.
Furthermore, the agreement imposed an obligation upon plaintiff to notify defendant of the date his earnings exceeded $125, 000 annually. Any other reading of the consent order would be nonsensical. Only plaintiff would have knowledge of his increased income, as the consent order did not include a mechanism for him to make financial disclosure to defendant. It was not unreasonable for her to assume that if she dealt with plaintiff in good faith, and voluntarily agreed to a reduction by half of his obligation, that he would also deal with her in good faith. Clearly, defendant agreed to a reduction in child support in acknowledgment of plaintiff's straitened financial circumstances to his benefit. That accommodation should not result in the loss of income available to the children because plaintiff failed to timely inform defendant of his increased wages at the time the increase occurred.
With little explanation, the judge set the new amount of support at an additional $500 a month, when plaintiff's annual income exceeded the $125, 000 cut-off by nearly $200, 000 in 2011 alone. Modification of the amount required at least some analysis of the parties' financial circumstances and the children's needs pursuant to the child support guidelines, N.J.S.A. 2A:34-23, and relevant caselaw. Furthermore, the court failed to make findings as to his calculations of the amount as required by Rule 1:7-4, an omission that seems particularly puzzling in light of the equities involved. See Ducey v. Ducey, 424 N.J.Super. 68, 74 (App. Div. 2012) ("In matrimonial matters, judges should enter final judgments accompanied by the underlying factual findings and reasoning."). This too was error.
Lastly, the parties agree that in order for any plenary hearing to be meaningful, defendant's financial circumstances must also be disclosed. Accordingly, during the ninety-day discovery period, the parties shall file updated case information statements, answer interrogatories, and otherwise make full disclosure of their financial status.
Although we reverse, plaintiff shall continue to pay at the current rate until a final decision is made after a plenary hearing regarding his obligation. It is not our purpose to reduce available funds to the parties' children as a result of defendant prevailing on appeal. Until such time as a new order is entered retroactive to November 2009, and new calculations made based on both parties' true income, plaintiff shall pay $2000 per month in support. Appropriate adjustments shall be made after the entry of the order.
Reversed and remanded. We do not retain jurisdiction.