October 18, 2013
MARGARET DOLAN, Plaintiff-Appellant,
EDWARD DOLAN, JR., Defendant-Respondent.
NOT FOR PUBLICATION WITHOUT THE APPROVAL OF THE APPELLATE DIVISION
Submitted December 12, 2012
On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Camden County, Docket No. FM-04-1014-09.
Margaret Dolan, appellant pro se.
Adinolfi and Lieberman, P.A., attorneys for respondent (Kimberly A. Reiser, on the brief).
Before Judges Sapp-Peterson and Nugent.
Plaintiff, Margaret Dolan, appeals from certain provisions of a July 28, 2010 Final Judgment of Divorce (Amended), entered following a seven-day trial. She contends: her alimony award is inadequate; two of her sons should not be required to repay part of the debt they incurred to attend college; and she should not be responsible for certain marital debts. Plaintiff also asserts that defendant's share of the proceeds from a marital asset should be placed in trust to secure his support obligations in the event of his death, and challenges as inadequate the amount of counsel fees the court awarded to her. Having considered plaintiff's arguments in light of the record and applicable law, we affirm.
The parties married on July 24, 1982, and have three sons. Their oldest son is deceased. Their other sons are ages twenty-five and twenty-three. Plaintiff filed a complaint for divorce on January 6, 2009, and defendant filed an answer and counterclaim on February 13, 2009. Unable to resolve any of their differences, the parties tried their dispute during seven days in April 2010. They developed the following proofs during the trial.
Plaintiff, age fifty-three at the time of trial, was born in Poland where she attended school through eighth grade. She came to the United States when she was seventeen years old. She received a G.E.D. in approximately 1990 after first failing, but then passing the required test. When she met defendant in 1981, she was working as a dancer. She signed an antenuptial agreement before marrying him.
Defendant has a Bachelor's Degree in Business Administration that he received in 1978 from Widener College. Following graduation, he worked for approximately six to eight months as a project manager on a single-family-home development in Chicago, then returned to help his father with the family construction and demolition business. He also did some modeling and acting. Defendant was living in a home on Miller Avenue in Gloucester City when he met plaintiff and she moved in with him in 1981.
Plaintiff stopped dancing not long after she met defendant. She worked in retail at various places, including John Wanamaker, Cumberland Farms, and a beauty salon. After the birth of the parties' third son in February 1990, plaintiff worked at a beauty salon for approximately six months, but did not return to work as a full-time employee thereafter. During the marriage, she was primarily the family's homemaker. She cleaned the house, cared for the children, and took care of the yard, including cutting the grass and planting flowers. During the course of her marriage, she repainted the walls in every room of the parties' home. She also was involved with her children's athletic endeavors, including once going to Georgia with her youngest son when he played in a national basketball tournament.
At age forty, plaintiff developed rheumatoid arthritis. She testified during the trial that she was currently under the care of a rheumatologist, cardiologist, pulmonologist, and neurologist. She suffered from chronic pain, which worsened during the evening, making it difficult for her to sleep for more than two or three hours at night. She was also seeing a psychologist and attending an organization called Compassionate Friend to help her cope with the loss of her oldest son, who had died in December 2008. Plaintiff described her health as very poor. Before the trial began, she had undergone a vocational evaluation at defendant's request. Defendant presented neither the vocational report nor the expert at trial.
During the twenty-eight year marriage, defendant's main business, though not his main source of money, was a sports memorabilia business he operated out of a store called "Baseball Fanatic Super Store." Determining his yearly income from the store's operation was virtually impossible because he paid no income taxes between 2002 and 2008, and he was either unable to locate or unwilling to relinquish the records needed to precisely determine the business's gross profits and net income. Defendant testified that his business generated a net profit of approximately eight percent of its gross income and that his average yearly income from his business was $25, 000. He claimed to have sustained a business loss in 2002, when he had to liquidate his inventory to sell the building where his business was located, and to have lost money in 2009. In 2008, defendant's sport memorabilia business grossed approximately $71, 500 from eBay sales and $25, 400 from consignment sales. According to defendant, the most money he ever made in one year was between $45, 000 and $50, 000 in 1987 or 1988 when he worked in a family demolition business.
Defendant was able to provide a comfortable lifestyle for plaintiff and their children primarily through the sale of fixed assets that had been conveyed to him by his father. Generally, his father would purchase real estate, convey it to him in exchange for a note, then forgive the indebtedness. In 1999, defendant sold a home that both his grandfather and father had once owned for $87, 900. In 2003, defendant sold the building in Gloucester City that housed the Baseball Fanatic Super Store. Although he had once owned the property with his brothers and sisters, then with his mother, he was the sole owner when he sold it for a net profit of approximately $450, 000. In 2006, defendant's mother, defendant, and plaintiff sold a home in Cherry Hill for $445, 000. Defendant's father, who had once owned the home with defendant's mother, had deeded his fifty percent share to defendant and plaintiff, who eventually received fifty percent of the proceeds from the sale.
Defendant's father had also financed the parties' purchase of their marital home. Before the parties were married, defendant purchased a home in Gloucester City from his parents. In January 2001, defendant built the house in Mt. Ephraim where defendant and plaintiff raised their family and where plaintiff still resided during the trial of her divorce complaint. Defendant's father purchased the lots in Mt. Ephraim from an estate. He then conveyed the lots to defendant, and also loaned defendant money to build the marital residence. Defendant gave his father a demand note in the amount of $252, 700, which his father began forgiving in 2002. Although defendant's father began forgiving the debt at the rate of $44, 000 per year, $22, 000 each to defendant and plaintiff, defendant did not know what remained on the note as of the time of trial. He could only testify that he owed his father the original demand note, plus interest, less the amount that had been forgiven.
From the Mt. Ephraim lots his father had conveyed to him, defendant not only built his marital home, but also subdivided the property and conveyed two of the lots: one on which a company he formed, Dolan Development Corporation, built a home, which it sold for $196, 000; the other that defendant sold undeveloped for $75, 000. During the course of the parties' marriage, defendant and plaintiff refinanced the marital home for $200, 000.
Defendant was unable to account for any of the money he had realized from the various sales of the houses and the commercial building, other than to say that the sale of those assets, as well as gifts from his family and loans from his family, financed his family's budget and lifestyle.
In 2007, defendant began receiving periodic payments from a trust fund established by his father. He received $79, 445 in 2007, $70, 105 in 2008, and $70, 170 in 2009. Although defendant was required to pay taxes on the distributions, he had yet to pay any taxes as of the time of trial.
The parties disputed facts about their lifestyle during their marriage. Plaintiff claimed that during their marriage they bought new cars every four or five years. She did not cook, and the family either ate out or ordered takeout "all the time." The children attended the best schools, including parochial high school. The younger two children had attended St. Joseph's University. Although plaintiff acknowledged that defendant's father had paid much of the tuition for the children's education, she maintained that the monthly family budget while the children were attending college was $19, 577.
On the other hand, defendant testified that the family had taken only three vacations in twenty-eight years. He claimed his father paid the tuitions for their younger two children to attend St. Joseph's University. According to him, the family's monthly budget was $8, 430.
Both parties testified they were in considerable debt. Plaintiff claimed defendant had not paid balances on her credit cards, as ordered by the court during pre-trial motion practice, and consequently she was being sued by creditors. She also accused defendant of withholding payments for her unreimbursed medical expenses and prescriptions. As an example, she claimed she had developed a severe tooth ache shortly before the trial began, but could not have a dentist treat it because defendant had refused to pay for it. Plaintiff also believed that defendant had stopped paying for the children's tuition because she filed the divorce complaint.
Defendant testified that he had remaining inventory from his sports memorabilia business that was worth approximately $10, 000. His father was willing to lend him and plaintiff the money for their children's tuition, but plaintiff refused to co-sign for the loan. He claimed that his indebtedness, in addition to the mortgages and taxes on the marital residence, and the taxes he owed the government, exceeded $100, 000. His debts included $5, 000 to an auction firm, $17, 000 that he borrowed to pay his son's funeral expenses, money owed to his accountant, and approximately $80, 000 in counsel fees for the litigation.
Defendant asked the court to emancipate his children. His second son had moved to Philadelphia, and though his youngest son was living in the marital residence he was not contributing to it.
In a comprehensive written opinion, the trial court determined that the antenuptial agreement was unenforceable because it precluded a fair and equitable distribution of marital assets and also failed to provide a full and complete disclosure of defendant's financial wealth. Next, the court made its findings of fact and determined the parties had enjoyed a middle-class lifestyle during their marriage, "funded in substantial part by gifts from [defendant's] family or business deals in which [defendant] was involved that were orchestrated by his family." The court noted the difficulty it had evaluating the parties' income because of their failure to file income tax returns since 2002.
Notwithstanding whatever income defendant may have earned from his sports memorabilia business, the court determined that "to this day, the lifestyle enjoyed by either of the parties is financed as a result of an irrevocable trust created by . . . [d]efendant's father which affords the only reliable income stream the Court can look to in resolving financial issues." Lastly, the court noted the extent to which the parties and their family had suffered as a result of the death of their oldest son.
After carefully analyzing the factors relevant to alimony set forth in N.J.S.A. 2A:34-23 and controlling case law, the court awarded plaintiff alimony in the amount of $385 per week. In its analysis, the court imputed income of $26, 040 to each party, and considered that defendant received approximately $70, 000 per year from the family trust.
As to equitable distribution, the court ordered that the marital residence be promptly sold and the proceeds distributed equally to the parties. From defendant's share, $14, 500 was to be used to pay plaintiff's credit card debts. The court also ordered that from the net proceeds of the sale of the Mt. Ephraim lots, the following debts were to be paid: the balance due on the note to defendant's father; property taxes; and federal and state income taxes. The balance, if any, was to be evenly divided between the parties.
The court determined that plaintiff's equitable share in her mother's home, about which plaintiff had testified, had been a gift and was not subject to equitable distribution.
The court also ordered that the remaining inventory from defendant's sports memorabilia business was to be sold, that the parties' income taxes were to be paid, and any funds remaining were to be divided equally between the parties.
As to the parties' debts, the court ordered that they be equally responsible for income taxes for the years 2000 through 2008, since they equally enjoyed the revenue received during those years. With the exception of the debt the parties owed to defendant's father for the loan for the marital residence, the court ordered that defendant was solely responsible for any debt owed to his family.
The court emancipated the parties' children and ordered that with respect to tuition or other college expenses of either child, plaintiff was responsible for one-third of the outstanding expenses, defendant was responsible for one-third, and the child was responsible for one-third.
Lastly, after considering the factors enumerated in Rule 5:3-5(c), the court ordered that defendant pay plaintiff $2, 940 in counsel fees for the day that defendant had delayed the trial.
Plaintiff argues on appeal that her alimony award is inadequate because it is only a question of time until she becomes disabled, defendant is capable of earning more than the judge imputed to him, and defendant lives a lavish and luxurious lifestyle. Plaintiff also argues that the court erred in its allocation of marital debt. She claims the note to defendant's father for the loan to buy the marital home and surrounding property was a sham, and that because she did not know defendant was not filing tax returns and paying taxes, she should not be held accountable for income tax arrearages.
As to the debt for the children's college tuition, she asks that both she and her sons be relieved of any obligation. She asserts that her sons did not work before they entered college, or while attending college, because defendant had given them the impression that he or his family would pay for their college education. She also points out that defendant or his parents had paid for the children to attend school throughout their lives, until the divorce proceedings.
As to counsel fees, plaintiff argues that defendant should be required to pay a far greater share of her counsel fees than the court required, because he repeatedly obstructed discovery, requiring her to file numerous motions.
Defendant responds that plaintiff has established no legal grounds to support any of the arguments she has made on appeal. He contends that as to its decision on each subject the parties litigated, the court relied on all relevant factors enumerated in relevant statutes and case law, and that the court's decision was supported by the evidence the parties presented during the trial.
The standards governing our review of a decision by a Family Part judge following trial are well-settled. We recognize the special expertise of Family Part judges and accept their findings "when supported by adequate, substantial, credible evidence." Cesare v. Cesare, 154 N.J. 394, 411-12 (1998) (citing Rova Farms Resort, Inc. v. Investors Ins. Co. of Am., 65 N.J. 474, 484 (1974)). We review the "trial court's interpretation of the law and the legal consequences that flow from established facts" de novo, Manalapan Realty v. Twp. Comm. of Manalapan, 140 N.J. 366, 378 (1995), reversing only when the "court's conclusions are . . . 'clearly mistaken' or 'wide of the mark, " N.J. Div. of Youth & Family Servs. v. E.P., 196 N.J. 88, 104 (2008), or when we determine the court has palpably abused its discretion, see Cesare, supra, 154 N.J. at 412.
Here, the trial judge applied appropriate legal standards and his findings were supported by substantial credible evidence in the record as a whole. Plaintiff argues that the judge over valued her imputed income because she will likely be permanently disabled in the future, and undervalued defendant's imputed income. Imputing income to a party involves discretionary decision-making that is not capable of precision or exactness, but nevertheless requires "a trial judge to realistically appraise [both one's] capacity to earn" and the availability of relevant jobs. Storey v. Storey, 373 N.J.Super. 464, 474 (App. Div. 2004). "A trial judge's decision to impute income of a specified amount will not be overturned unless the underlying findings are inconsistent with or unsupported by competent evidence." Id. at 474-75.
Plaintiff argues that the trial judge failed to consider that she will likely be totally disabled in the future. The judge considered her current testimony concerning her medical condition. She introduced no medical evidence concerning any future impairment or disability. The judge was certainly not required to speculate about future problems plaintiff might encounter.
Plaintiff also contends the judge undervalued defendant's imputed income, particularly in view of his college degree and the fact that he had once owned his own business. But defendant had earned his degree more than twenty years earlier, and there was no evidence presented during the trial to suggest that he had either maintained the knowledge he once had, or retained the skills he had developed when studying for his college degree. Moreover, there was no evidence that defendant could continue to successfully run a sports memorabilia business. The trial evidence suggested otherwise.
Plaintiff's argument that defendant's father's demand note was a sham was contradicted by defendant's testimony as well as documentary evidence. When reviewing a trial judge's factual determinations, "[w]e do not weigh the evidence, assess the credibility of witnesses, or make conclusions about the evidence." Mountain Hill, L.L.C. v. Twp. of Middletown, 399 N.J.Super. 486, 498 (App. Div. 2008) (quoting State v. Barone, 147 N.J. 599, 615 (1997)). "Because a trial court 'hears the case, sees and observes the witnesses, [and] hears them testify, ' it has a better perspective than a reviewing court in evaluating the veracity of witnesses." Pascale v. Pascale, 113 N.J. 20, 33 (1988) (alteration in original) (quoting Gallo v. Gallo, 66 N.J.Super. 1, 5 (App. Div. 1961)). We discern nothing in the record that would lead us to question the trial judge's determination that defendant's father's demand note was valid.
Nor do we see any reason to disturb the judge's conclusion that plaintiff was responsible for one-half of the delinquent federal and state income taxes. When a Family Part judge decides how a marital estate should be equitably distributed, the judge "must take into account the liabilities as well as the assets of the parties." Monte v. Monte, 212 N.J.Super. 557, 567 (App. Div. 1986). Moreover, "if the assets are to be divided between the parties, the debts incurred in obtaining those assets should likewise be allocated between the parties[, ] . . . [but] it may not be an abuse of judicial discretion to divide the assets of the parties equally without requiring them to share the debts." Ibid. (citations omitted). Cf. Hughes v. Hughes, 311 N.J.Super. 15, 37 (App. Div. 1998) (explaining that the defendant, who did not receive the benefit of one-half of plaintiff's income, should not have been required to pay one-half of the taxes, because "otherwise [the plaintiff] would be required to pay a substantial portion of the taxes on the income that plaintiff alone enjoyed").
In the case before us, there was ample evidence from which the judge could have concluded that plaintiff enjoyed her middle-class lifestyle in part because of the income defendant earned, on which he paid no taxes. The judge did not abuse his discretion by ordering that both parties bear the tax burden equally.
Plaintiff's remaining arguments are without sufficient merit to warrant discussion in a written opinion. R. 2:11-3(e)(1)(E). We add only the following. In addressing the debt resulting from the children's attendance at St. Joseph's University, the court was confronted with debt that had already been incurred, not the parents' prospective obligation to provide a college education for their children. There was ample evidence in the record to support the judge's treatment of the debt that had been incurred as a marital debt. Further, there was ample evidence in the record, including the evidence that plaintiff had refused to make a good faith attempt at settlement, to support the fee award. The judge considered appropriate factors and did not abuse his discretion by failing to award plaintiff a greater amount.