MIRIAM B. STENGER VS. JAMES R. STENGER(FM-14-1206-04, MORRIS COUNTY AND STATEWIDE) ( 2017 )

NOT FOR PUBLICATION WITHOUT THE
APPROVAL OF THE APPELLATE DIVISION
This opinion shall not "constitute precedent or be binding upon any court."
Although it is posted on the internet, this opinion is binding only on the
parties in the case and its use in other cases is limited. R.1:36-3.
SUPERIOR COURT OF NEW JERSEY
APPELLATE DIVISION
DOCKET NO. A-1582-15T4
MIRIAM B. STENGER,
Plaintiff-Respondent/
Cross-Appellant,
v.
JAMES R. STENGER,
Defendant-Appellant/
Cross-Respondent.
________________________________________________
Argued March 16, 2017 – Decided September 19, 2017
Before Judges Espinosa and Guadagno.
On appeal from the Superior Court of New
Jersey, Chancery Division, Family Part,
Morris County, Docket No. FM-14-1206-04.
Jessica A. Bosch argued the cause for
appellant/cross-respondent (Dalena & Bosch,
LLC, attorneys; Ms. Bosch, on the briefs).
Jennie L. Osborne argued the cause for
respondent/cross-appellant (Einhorn, Harris,
Ascher, Barbarito & Frost, PC, attorneys;
Stephen P. Haller and Ms. Osborne, of
counsel and on the briefs).
PER CURIAM
Defendant James R. Stenger appeals from an order entered on
June 30, 2015 denying his motion for termination or modification
of his alimony obligation to plaintiff Miriam B. Stenger.
Defendant also appeals from the November 20, 2015 order denying
his motion for reconsideration. Plaintiff cross-appeals from
the portion of the November 20, 2015 order denying her motion
for counsel fees and costs.
The parties married in 1986, and divorced in 2005. Four
children were born of the marriage, all of whom are now
emancipated. During the marriage, defendant worked for
plaintiff's father in his insurance business, F.A. Bonauto and
Associates (FABA), in Morristown. Defendant's brother-in-law,
Kenneth French, also worked at FABA. In 1986, defendant and
French formed National Association Services, Inc. (NAS),
providing wholesale and retail insurance services, including
health insurance policies, to the general public.
Plaintiff filed a complaint for divorce in 2004 and
retained a forensic accountant to examine defendant's income and
the value of his interest in NAS. The parties engaged in
discovery, including depositions, interrogatories, and document
production.
In January 2005, after extensive negotiations, the parties
entered into a property settlement agreement (PSA) which
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resolved all outstanding issues. On March 31, 2005, a final
judgment of divorce was entered incorporating the PSA.
Pursuant to the PSA, defendant was obligated to pay
plaintiff permanent alimony of $162,000 per year which would
terminate upon the death of either party or plaintiff's
remarriage. Defendant was required to maintain a $1,000,000
life insurance policy, naming plaintiff as the beneficiary. Of
significance to our discussion, the PSA provides:
When the HUSBAND reaches age sixty-two (62),
assuming the WIFE has not remarried or
predeceased him, the parties shall negotiate
an adjustment in the face amount of the
insurance based on the cost of the premium,
the HUSBAND's income, the WIFE's income at the
time, if any, and actuarial considerations.
If the parties cannot reach an agreement with
respect to the amount of insurance coverage
the HUSBAND is obligated to provide to the
WIFE, either party may make application to the
Superior Court of New Jersey, Chancery
Division[.]
The PSA permitted defendant to retain his business interest
in NAS "free and clear" of any interest of plaintiff. In
consideration for this waiver by plaintiff, the agreement
obligated defendant to pay plaintiff $800,000 with interest in
quarterly installments. This amount was calculated pursuant to
a business evaluation report, which estimated that NAS was worth
approximately $1.8 million at the time of the divorce. This
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payment term was to be evidenced by a promissory note secured by
a pledge agreement of defendant's stock in NAS.
In March 2010, NAS was sold to BenefitMall Holdings, Inc.
(BenefitMall) for $10.2 million. Defendant received $5.1
million for his fifty-percent share of the company. Defendant
then made a lump sum payment of $800,000 to plaintiff pursuant
to the PSA and placed the remaining proceeds of approximately
$4.3 million in an investment account with Wells Fargo.
After the sale, defendant agreed to work for BenefitMall as
the director of business development, earning $203,733 in 2010;
$143,396 in 2011; and $73,485 in 2012. Then, at age sixty-one,
defendant retired and relocated to Florida.
In 2013, plaintiff sold the former marital home in
Morristown for $875,000 and purchased a smaller home in Morris
Plains for $640,000. Plaintiff worked part-time at a retail
store in Morristown, earning approximately $11,440 in 2013, and
$15,826 in 2014.
In March 2015, defendant filed a motion to terminate or
reduce his alimony and life insurance obligations based on the
change of circumstance of his retirement. Defendant's case
information statement indicated his net income for 2014 was
$134,356, and his monthly expenses totaled $9062. Plaintiff
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opposed the motion and sought to compel defendant to maintain
the $1,000,000 life insurance policy.
On June 30, 2015, the motion judge entered an order
accompanied by a written statement of reasons denying
defendant's motion. The judge also denied plaintiff's cross-
motion to maintain the insurance obligation and encouraged the
parties "to discuss lowering the policy amount."
Defendant moved for reconsideration and sought discovery
and a plenary hearing. That motion was denied on November 20,
2015.
On appeal, defendant argues the motion judge erred in
failing to order discovery and a plenary hearing as he made a
prima facie showing of changed circumstances, and the parties
conflicting certifications demonstrated a clear dispute of fact.
Defendant also claims he established that his earned income had
been reduced from $700,000 per year to zero as a result of his
retirement and he was unable to continue to pay alimony to
plaintiff at a rate of $13,500 per month. Defendant also
maintains that plaintiff no longer has an ongoing need for that
amount of alimony, and the parties had contemplated his
retirement at age sixty-two in the PSA. Finally, defendant
claims the judge erred in determining that he has the ability to
pay based on monies defendant received from the sale of NAS.
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The general rule is that findings by the trial court are
binding on appeal when supported by adequate, substantial,
credible evidence. Gnall v. Gnall, 222 N.J. 414, 428 (2015). We
do not disturb the "factual findings and legal conclusions of
the trial judge unless . . . convinced that they are so
manifestly unsupported by or inconsistent with the competent,
relevant and reasonably credible evidence as to offend the
interests of justice." Cesare v. Cesare, 154 N.J. 394, 412
(1998) (quoting Rova Farms Resort, Inc. v. Investors Ins. Co. of
Am., 65 N.J. 474, 484 (1974)). "Because of the family courts'
special jurisdiction and expertise in family matters, [we]
accord deference to family court factfinding." Id. at 413.
However, our review of a trial court's legal conclusions is
plenary. Manalapan Realty, L.P. v. Twp. Comm. of Manalapan, 140
N.J. 366, 378 (1995).
We review a decision on a motion for reconsideration under
an abuse of discretion standard. Fusco v. Bd. of Educ. of
Newark, 349 N.J. Super. 455, 462 (App. Div.), certif. denied,
174 N.J. 544 (2002). An abuse of discretion "arises when a
decision is 'made without a rational explanation, inexplicably
departed from established policies, or rested on an
impermissible basis.'" Flagg v. Essex Cty. Prosecutor, 171 N.J.
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561, 571 (2002) (quoting Achacoso-Sanchez v. Immigration &
Naturalization Serv., 779 F.2d 1260, 1265 (7th Cir. 1985)).
"Motions for reconsideration are granted only under very
narrow circumstances[.]" Fusco, supra, 349 N.J. Super. at 462.
Reconsideration should be used only for those
cases which fall into that narrow corridor in
which either (1) the Court has expressed its
decision based upon a palpably incorrect or
irrational basis, or (2) it is obvious that
the Court either did not consider, or failed
to appreciate the significance of probative,
competent evidence.
[Ibid. (quoting D'Atria v. D'Atria, 242 N.J.
Super. 392, 401 (Ch. Div. 1990)).]
Defendant argues that his retirement constitutes a changed
circumstance as his earned income was reduced to zero. He also
claims the previously referenced provision in the PSA mandating
an adjustment in the amount of insurance coverage when he
reached age sixty-two indicates the parties anticipated he would
retire at that age.
The motion judge rejected this argument and held the
provisions in the PSA relating to alimony and insurance coverage
were "clearly separable," and defendant's argument to the
contrary was "at best misplaced, and at worst grossly
disingenuous."
A property settlement agreement is governed by basic
contract principals. J.B. v. W.B., 215 N.J. 305, 326 (2013).
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The language of the PSA is clear that the parties intended to
reevaluate the life insurance policy when defendant reached the
age of sixty-two because, at that age, the premium increases
from $1463.75 to $27,968.15. Based on this increase, it is
apparent why defendant would have negotiated for this clause in
the PSA. Nowhere in the document is there an indication that
defendant intended to retire or renegotiate alimony at this age.
The judge noted that defendant voluntarily sold his
interest in NAS in 2010, and in the four years following the
divorce, his average income substantially exceeded the income
figure utilized in the PSA to calculate his alimony obligation.
Of more significance is the judge's conclusion that defendant
failed to provide sufficient documentation to allow him "to
scrutinize the investment portfolio and determine the level of
passive income being generated by the account."
Defendant's response to this finding is that the judge
should have ordered a plenary hearing in order to obtain the
needed information. This cart-before-the-horse approach is
fundamentally at odds with the settled principle that the party
moving for modification bears the burden of making a prima facie
showing of changed circumstances. Lepis v. Lepis, 83 N.J. 139,
157-59 (1980). This showing must be made before a court
considers whether to order a plenary hearing. Id. at 159. The
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judge's finding that defendant failed to provide sufficient
documentation finds ample support in the record and we see no
reason to disturb it.
Finally, defendant claims the motion judge erred in
considering proceeds from the sale of his business when weighing
defendant's ability to pay his alimony obligation, and should
have limited his inquiry to defendant's "current income" and
excluded any income flowing from the sale of his business. We
disagree.
"Although some assets may be exempt from those subject to
equitable distribution (such as an inheritance), income derived
from those excludable assets may be considered in the initial
alimony decision or modification of an alimony award." Miller v.
Miller, 160 N.J. 408, 422 (1999). There is no indication in the
PSA that the parties intended to exclude the proceeds or income
generated from the proceeds of the sale of defendant's business.
Even if the parties had exempted the proceeds, "the income
generated by [an exempted asset] is no different from income
generated by any other asset, exempt or otherwise, for an
alimony analysis." Aronson v. Aronson, 245 N.J. Super. 354, 363
(App. Div. 1991).
The remaining arguments presented by defendant lack
sufficient merit to warrant further discussion in our opinion,
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as does plaintiff's claim that the judge erred in denying her
request for counsel fees and costs. R. 2:11-3(e)(1)(E).
Affirmed.
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