In the Matter of Ulrike Newsted and Gary Newsted ( 2024 )

THE STATE OF NEW HAMPSHIRE
SUPREME COURT
In Case No. 2023-0012, In the Matter of Ulrike Newsted
and Gary Newsted, the court on February 13, 2024, issued the
following order:
The court has reviewed the written arguments and the record submitted
on appeal, has considered the oral arguments of the parties, and has
determined to resolve the case by way of this order. See Sup. Ct. R. 20(2). In
this appeal from a final order of the Circuit Court-Family Division (Burns, J.),
the petitioner, Ulrike Newsted (Wife), appeals the trial court’s ruling that she
improperly redirected payments pursuant to a loan agreement from the
respondent, Gary Newsted (Husband), to herself. The Wife argues that the
family division: (1) lacked subject matter jurisdiction to divide the loan after
ruling that the loan was not marital property; (2) impermissibly rewrote the
loan agreement; (3) erred when it failed to find that the Husband waived his
rights under the loan agreement; and (4) erred when it found that the Wife was
the author of a contested email. We affirm.
The record supports the following facts. The parties were married in
April 2016, and they divorced in May 2019. In November 2016, the parties
executed a loan agreement with the Wife’s adult son. The agreement lists the
Husband as “lender,” the Wife as “co-lender,” and the Wife’s son as “borrower.”
The purpose of the loan was “to pay off five student loans that [the son] was
responsible for.” A portion of the loan was used to pay off three student loans
that the Wife had taken out to finance her son’s college education, and the
balance of the loan was used to pay off two loans that the son had taken out to
pay for college. The Husband provided the funding for the loan, which he
derived from an inheritance from his parents. Pursuant to the loan
agreement’s payment terms, the son was required to make ninety-six monthly
payments from December 2016 through December 2024 directly to the
Husband’s bank account.
From December 2016 until April 2019, the son issued monthly payments
to the Husband’s account. In April 2019, the Wife instructed her son to
redirect the monthly loan payments to her rather than to the Husband. The
son thereafter issued the monthly loan payments to the Wife. The final divorce
decree, dated May 27, 2019, did not address the loan, even though both parties
listed the loan as an asset on their financial affidavits.
In January 2022, the Husband filed a motion for contempt, alleging that
the Wife “wrongfully, and without right, redirect[ed] payments owed from a
personal loan” to herself in violation of the terms of the loan agreement. The
family division held a two-day hearing on the motion in June and July 2022.
Much of the hearing testimony centered around a May 15, 2019 email entitled
“Fini,” in which the Husband allegedly told the son: “Our divorce is final. You
are absolved of any debt to me and there will be no civil action against you.
Have a good life.” Both the Husband and the Wife denied authoring the “Fini”
email.
In its October 2022 order, the trial court ruled that the Wife had no legal
basis or authority to redirect the loan payments from the Husband to herself,
explaining that “[t]here was no writing that allowed it, and no writing that
altered the terms of the loan agreement in any way.” Although the court
acknowledged that the Husband and the Wife are both identified in the loan
agreement as lenders, it concluded that “this does not defeat [the Husband’s]
claim that he is entitled to repayment of the loan, and that [the Wife] is not so
entitled.” The court reasoned that “while [the Wife] may argue that the
inherited funds were a marital asset,” the fact that the loan benefitted the Wife
and her son by allowing them to consolidate their loans “militate[s] against
such a finding.” The court determined that allowing the Wife to “use her
husband’s inheritance to achieve the elimination of her own debt – the direct
benefit of the loan – and also achieve the direct benefit of getting repaid by her
son after divorcing her husband” would unjustly enrich the Wife.
The family division also found that “[b]ased on the weight of credible
testimony, and taking into consideration the demeanors of the witnesses,” the
Wife, not the Husband, wrote the “Fini” email, and that “[t]his email was a
false, deceitful attempt on the part of [the Wife] to alter the repayment
arrangements of the loan due to [the Husband].” The court ordered the Wife to
disgorge the loan payments she had received since April 2019 and to pay the
Husband any future loan payments she receives from her son. The court
denied the Wife’s motion for reconsideration, and this appeal followed.
We first address the Wife’s argument that the trial court acted outside of
its subject matter jurisdiction because it “adjudicated the husband’s ownership
interest in the loan proceeds after ruling that the loan was not a marital asset
and without analyzing the property division factors called for in RSA 458:16-a.”
This argument requires that we analyze the family division’s jurisdiction to
effectively determine which party is entitled to the loan payments. “A court
does not have power to hear a case concerning subject matters over which it
lacks jurisdiction, and subject matter jurisdiction cannot be conferred where it
does not already exist.” Colburn v. Saykaly, 173 N.H. 162, 164 (2020). The
ultimate determination as to whether the trial court has jurisdiction in this
case is a question of law subject to de novo review. Id.As we have previously explained, “[t]he legislature established the circuit
court in 2011 by merging the former probate and district courts and the former
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judicial branch family division.” Id. at 165 (quotation omitted). It conferred the
jurisdiction, powers and duties of these former courts upon the circuit court
and divided the circuit court into three divisions: a probate division, a district
division, and a family division. Id. Although there remain statutory references
“to the probate or district courts or to the judicial branch family division,”
those references “shall be deemed to be to the New Hampshire circuit court
where it has exclusive jurisdiction of a subject matter and to the superior court
and circuit court where the circuit court has concurrent jurisdiction with the
superior court.” RSA 490-F:18 (Supp. 2023). Thus, when we refer in this
order to the family division, we necessarily refer to the circuit court.
“Because the powers and jurisdiction of the family division are limited to
those conferred by statute, we look to the relevant statutes to determine
whether the family division had subject matter jurisdiction.” In the Matter of
Muller & Muller, 164 N.H. 512, 517 (2013) (citation omitted). RSA 490-D:2
(Supp. 2023) provides, in pertinent part, that “the judicial branch family
division” has exclusive jurisdiction over “[p]etitions for divorce, nullity of
marriage, alimony, custody of children, support, and to establish paternity.”
RSA 490-D:2 (Supp. 2023). “The law is well settled that jurisdiction in divorce
proceedings is a continuing one with respect to all subsequent proceedings
which arise out of the original cause of action.” Daine v. Daine, 157 N.H. 426,
427-28 (2008) (quotation omitted). RSA 458:16-a (Supp. 2023) authorizes the
family division to distribute property that belongs to divorcing parties. See RSA
458:16-a, I (“Property shall include all tangible and intangible property and
assets, real or personal, belonging to either or both parties, whether title to the
property is held in the name of either or both parties.”). When doing so, the
court employs a two-step analysis. In the Matter of Chamberlin & Chamberlin,
155 N.H. 13, 16 (2007). First, the family division determines, as a matter of
law, which assets constitute marital property under RSA 458:16-a, I. Id.Then, the court exercises its discretion to equitably distribute those assets
pursuant to RSA 458:16-a, II. Id. The family division’s determination as to
whether certain assets constitute marital property presents a question of law,
which we review de novo, while the equitable division of property is reviewed for
an unsustainable exercise of discretion. Id.Here, the Wife argues that the family division was deprived of its
jurisdiction to resolve the parties’ loan dispute because the court concluded
either that the loan was not marital property or that a determination of
whether the loan was marital property was unnecessary. The Wife claims that
the trial court ruled that the loan was not marital property when it stated that
“while [the Wife] may argue that the inherited funds were a marital asset, the
following additional considerations militate against such a finding.” However,
the Wife misreads the trial court’s order. The court’s order distributed the loan
payments, not the Husband’s inheritance.
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The court further explained that deciding whether the loan was marital
property awarded to one party or the other at the time of the divorce “is
unnecessary, given the Court’s finding and ruling that the loan to [the son]
must be paid in accordance with its original terms, and not according to the
terms which [the Wife] attempted to re-write, without authority or legal basis.”
Contrary to the Wife’s assertion, the court did not state that deciding whether
the loan was marital property was unnecessary, but, rather, it explained that
determining whether the loan was marital property awarded to one party or the
other at the time of the divorce was unnecessary. By noting that “each party
could argue that the loan had been awarded to him or her,” the court
acknowledged that the loan was marital property but concluded that there was
insufficient evidence to decide whether the divorce decree awarded the loan to
the Husband or the Wife. Therefore, the court, at least implicitly, ruled that
the loan was marital property. Based on this ruling, the court acted within its
jurisdiction when it ordered that the loan be paid according to its original
terms.
Thus, given that the parties agree that the loan agreement concerns
marital property and because the family division has exclusive jurisdiction over
marital property, we conclude that the family division — not the superior court
— was the proper forum for addressing issues arising from the agreement. See
Maldini v. Maldini, 168 N.H. 191, 196 (2015). Accordingly, the family division
did not exceed the scope of its subject matter jurisdiction when it distributed
the loan.1
To the extent that the Wife argues that, even if the court acted within its
jurisdiction in deciding the parties’ loan dispute, the court erred by failing to
explicitly reference the factors enumerated in RSA 458:16-a, II in its final
order, we disagree. See RSA 458:16-a, IV (“The court shall specify written
reasons for the division of property which it orders.”). “The trial court’s
statutory obligation is to apportion the property equitably.” In the Matter of
Sarvela & Sarvela, 154 N.H. 426, 431 (2006). “In a divorce proceeding, marital
property is not to be divided by some mechanical formula but in a manner
deemed ‘just’ based upon the evidence presented and the equities of the case.”
Id. (quotation omitted). “The court need not consider all of the enumerated
factors [in RSA 458:16-a, II] or give them equal weight.” Id. Indeed, RSA
458:16-a, II(o) grants the court discretion to consider “[a]ny other factor that
the court deems relevant.” Here, the court issued a narrative order and ruled
on the parties’ requests for findings of fact and rulings of law. In its order, the
court determined that allowing the Wife to retain and receive the loan
1 The Wife also asserts that the trial court’s lack of citation to the factors enumerated in RSA
458:16-a, II (Supp. 2023), pertaining to the equitable division of marital property, is “but further
indication that the Family Division exceeded the scope of its statutory jurisdiction.” However, we
fail to see how any alleged deficiencies in the trial court’s order deprived the court of jurisdiction to
decide the instant dispute.
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payments would “fl[y] in the face of fundamental fairness,” and that, “[i]f
allowed, this Court believes she would be unjustly enriched.” Thus, we
conclude that the court complied with its statutory obligation to explain the
bases for the distribution it ordered. See id. at 433.2
The Wife also argues that the trial court erred by finding that she
authored the “Fini” email and by failing to find that the Husband waived his
rights under the loan agreement. We will affirm the trial court’s factual
findings unless the evidence does not support them or they are legally
erroneous. In the Matter of Martel & Martel, 157 N.H. 53, 62 (2008). The trial
court found that the Wife was the source of the “Fini” email that allegedly
released the son from his obligations under the loan agreement. The trial court
concluded that “[b]ased on the weight of credible testimony, and taking into
consideration the demeanors of the witnesses, . . . [the Husband] did not
author the Fini email, and [the Wife] did.” The court credited the Husband’s
testimony that he would never have forgiven the loan and could not have sent
the email because it was sent at a time when he did not have access to the
internet or his email account. The court also found that the Wife had access to
the Husband’s email account and “had a motivation to have sent such a
message to her son.” Further, the court determined that the “style and nature
of the email . . . would have been totally out of character” for the Husband
based upon the other emails introduced as evidence.
The court also credited the Husband’s testimony that he would not have
entitled an email “Fini” because he did not speak any languages other than
English. On the other hand, the court noted that the Wife spoke multiple
languages at least at a basic level, including German, French, and Italian. “As
the fact finder, the trial court was entitled to accept or reject, in whole or in
part, the testimony of any witness or party, and was not required to believe
even uncontroverted evidence.” In the Matter of Henry & Henry, 163 N.H. 175,
181 (2012). Here, the trial court credited the Husband’s testimony over the
Wife’s, and we will not disturb its decision to do so.
Finally, the Wife asserts that the absence of any correspondence between
the Husband and the son from May 2019 to January 2022 regarding the loan
payments evidences a waiver of the Husband’s right to pursue the payments.
“To establish waiver, the plaintiff must show either explicit language indicating
the defendant’s intent to [forgo] a known right, or conduct from which it may
be inferred that the defendant abandoned this right.” Gianola v. Continental
Cas. Co., 149 N.H. 213, 214 (2003).
2 The Wife further argues that the trial court erred by impermissibly rewriting the loan agreement.
However, because we conclude that the loan was marital property and that the family division did
not err by awarding the loan in its entirety to the Husband, we need not reach the merits of this
argument.
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The trial court found that the Husband did not waive his right to seek
payments on the loan. In reaching this finding, the trial court reasoned that
the Husband “testified credibly that he would never have forgiven the loan . . .
especially in light of the many other emails contained in the exhibits in which
he discusses the loan at length.” There is evidence in the record that the
Husband repeatedly emailed the Wife’s son in March and April 2019 regarding
the loan payments. We defer to the trial court’s judgment on such issues as
resolving conflicts in the testimony, measuring the credibility of witnesses, and
determining the weight to be given evidence. In the Matter of Henry & Henry,
163 N.H. at 183. Therefore, we conclude that the trial court’s finding is
supported by the evidence and thus affirm its conclusion that the Husband did
not waive his rights under the loan agreement.
Affirmed.
BASSETT, HANTZ MARCONI, and DONOVAN, JJ., concurred.
Timothy A. Gudas,
Clerk
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