ANDREW FLOCKHART VS. KAREN FLOCKHART (FM-19-0224-13, SUSSEX COUNTY AND STATEWIDE) ( 2019 )

NOT FOR PUBLICATION WITHOUT THE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-1578-16T2
ANDREW FLOCKHART,
Plaintiff-Respondent,
v.
KAREN FLOCKHART,
Defendant-Appellant.
_______________________________
Argued January 15, 2019 – Decided May 24, 2019
Before Judges Rothstadt and Gilson.
On appeal from Superior Court of New Jersey,
Chancery Division, Family Part, Sussex County,
Docket No. FM-19-0224-13.
Bonnie C. Frost argued the cause for appellant
(Einhorn, Harris, Ascher, Barbarito & Frost, PC,
attorneys; Bonnie C. Frost, of counsel and on the briefs;
Ivette R. Alvarez, on the briefs).
James P. Yudes argued the cause for respondent (James
P. Yudes, PC, attorneys; James P. Yudes, of counsel;
Elsie Gonzalez, on the briefs).
PER CURIAM
Defendant Karen Flockhart appeals and plaintiff Andrew Flockhart cross-
appeals from their judgment of divorce (JOD) that the Family Part entered after
a twelve-day trial. The JOD was accompanied by a forty-seven page decision
in which the trial court set forth the reasons for each of its determinations. In
their appeals, one or both of the parties challenge the court's rulings on alimony,
custody, child support, and equitable distribution (ED). They also challenge the
trial court's supplemental order on counsel fees and another order denying in
part their motions for reconsideration and awarding additional counsel fees. For
the reasons that follow, we affirm in part and vacate and remand in part for
reconsideration of child support and one aspect of ED.
I.
The parties met in 1987 and married in 1995. They had three children: a
daughter born in 1998; a son, born in 2000; and another son, born in 2004. The
parties separated in 2012, and plaintiff filed for divorce in November of that
year.
Prior to the marriage, plaintiff founded a successful landscaping business.
By his twenty-first birthday, his business success enabled him to purchase a
home that he and defendant lived in prior to their marriage. In approximately
1992, plaintiff expanded into the vegetative waste industry by leasing a farm
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where he could turn his landscaping business' leaf waste into compost and brush
into mulch.
Defendant, who had a graphic design degree and was employed by a
company, helped plaintiff with his landscaping business. In 1998, before the
birth of their first child, defendant stopped working at the company where she
had been employed and did not work again until 2014, when she obtained part-
time employment working ten to fifteen hours per week. At the time of trial,
she worked approximately twenty-five hours per week as a receptionist for a
physical therapy practice and made thirteen dollars per hour.
After their first child was born, plaintiff sold his home, and the parties
purchased his parents' home, where the parties lived until 2003. In 2003, they
sold that home and purchased a new larger home. Later, as described below,
they sold that home and purchased a new larger house (Skyview Property).
In 1998, after defendant sold his landscaping business, the parties formed
AKF Properties (AKF), an entity that they owned in equal shares. AKF
purchased property at 20 Cotluss Road in Riverdale for $400,000, and rented
out space in one of the buildings located on the property. Plaintiff used the
money from the sale of his landscaping business and proceeds from a loan to
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help purchase the Cotluss Road property and renovate the buildings on the
property.
Soon after forming AKF, plaintiff formed Riverdale Environmental
Recycling (RER) after representatives of the Borough of Riverdale approached
him about helping the municipality deal with its residents' vegetative waste.
RER was also owned by the parties in equal shares. RER leased property from
the borough where RER would accept vegetative waste brought by borough
residents, which RER would then process and sell as topsoil or mulch.
Eventually, the leased property was not sufficient, so plaintiff rented part of a
property on Clark Road in Wantage Township to process the vegetative waste,
which, in 2004, he purchased for $400,000 through a company he formed, named
Clark Road Realty, LLC (CRR). Plaintiff owned 100% of CRR.
Also in 2004, plaintiff formed another company, RER Supply, LLC
(RERS), this time with his mother who owned fifty-five percent while plaintiff
owned the remaining forty-five percent. Plaintiff's mother loaned the business
$200,000, which it used to purchase equipment, but there was no written
documentation of the loan.
In 2008, plaintiff acquired additional property for RER's business through
yet another company he formed. The new company, Riverdale Realty LLC (RR)
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purchased property at South Corporate Drive in Riverdale. Plaintiff owned
ninety percent of RR, and defendant owned ten percent.
By 2006, while the parties' various companies expanded, their marriage
began to unravel, especially after plaintiff admitted to having an affair.
Plaintiff's abuse of alcohol also contributed to the marriage's demise. In 2008,
plaintiff left the family home for three months. When he returned, he learned
that defendant was romantically involved with other men, causing additional
harm to the parties' relationship. The parties tried to address their issues through
counseling and the purchase of the Skyview Property. Neither effort helped
their situation. Alcohol abuse and violent behavior made matters worse. In
2012, plaintiff left the marital home, but the parties' relationship continued to
sour, giving rise to allegations of domestic violence and unsubstantiated
allegations of child abuse.
The parties' marital discord injured their relationships with their children.
Initially, after plaintiff left the marital home, he was seeing his sons regularly,
but saw his daughter only sporadically as she refused to communicate with him,
despite his sending several texts to her every day, to which she would not
respond. After plaintiff filed for divorce, he perceived that his children "started
to change the way they looked at [him], the way they acted toward [him]."
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During one episode of parenting time, plaintiff recalled that the children ran
away from his house and went back to defendant's house. Plaintiff believed
defendant was responsible for the change in his children's behavior towards him.
He claimed she prevented him from seeing the children, although they expressed
that they wanted very little to do with him.
Defendant denied preventing the children from visiting plaintiff,
explaining that it was difficult to get them to visit him. She also denied
disparaging plaintiff in the children's presence. However, according to
certifications defendant filed during the divorce, she stated that it was not her
responsibility to ensure that plaintiff had a healthy relationship with the
children, and that a relationship with their father would be harmful to their
daughter and older son.
The marital discord significantly affected their older son. He began to
struggle in school and showed signs of depression. School officials arranged a
meeting with the parties and their parenting coordinator, where the school
officials raised concerns that the older son was self-medicating and told the
parties that they should focus on their son's well-being, not his grades. A month
later, after an incident at defendant's house, the older son moved in with
plaintiff, and his grades improved. However, when defendant and the parties'
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daughter began sending him frequent text messages, he got upset and his grades
fell again.
The parties' deteriorating relationship significantly affected their ability
to communicate with each other about the children. A court order in 2012
initially prevented plaintiff from having any contact with defendant for a
significant time. According to defendant at trial, she had not spoken regularly
with plaintiff in years, which made communicating very difficult. Instead, they
corresponded via text or email, but even that was intermittent. Defendant
complained that plaintiff did not consistently tell her about the older son's
doctor's appointments and school reports. She stated that the lack of
communication made it hard on the children and that she wanted better
communication.
At the time of trial, the older son continued to live with plaintiff and
plaintiff wished to maintain that arrangement. The younger son lived with
defendant and plaintiff saw him every other weekend and one day during the
week. Plaintiff realized that he could not force his daughter to have a
relationship with him and cut back on his attempts to interact with her.
During the marriage, the family lived a very comfortable lifestyle and, in
addition to the businesses, acquired various assets. Their marital home, the
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Skyview Property, was eventually listed for sale at approximately $900,000, but
was encumbered by a mortgage in almost the same amount. They also owned a
timeshare in Florida, which was also encumbered by a mortgage in the amount
of $254,385.24 at the time of trial, and they owned a lot on Lake Mohawk that
was valued at $6500.
In addition to real property, plaintiff claimed he left $100,000 in cash in a
safe in the basement, which he later admitted was $60,000 in 2012, and believed
defendant had taken that money. Although defendant initially said that she did
not take any money from the basement safe, she later admitted taking $7000 to
$8000 from the safe for a trip. Defendant claimed that plaintiff took her
engagement and wedding rings from her personal safe and took a Mercedes S550
owned by AKF out of the garage while she was away.
Plaintiff filed his complaint on November 21, 2012, and defendant filed
an answer and counterclaim on February 5, 2013. For the next approximately
four years, the parties engaged in contentious motion practice, with the trial
court entering numerous orders finding defendant in violation of litigant's rights
by not complying with court orders, including those directing her to cooperate
with the court-appointed parenting coordinator and with the sale of the Skyview
Property. In several of the orders, the court awarded plaintiff counsel fees. A
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September 4, 2015 order barred defendant from presenting an expert witness
because she failed to serve any expert reports.
At trial, in addition to the parties, various fact witnesses testified. Plaintiff
also produced expert witnesses. A former friend of both parties testified on
behalf of plaintiff. She described herself as having once been one of defendant's
best friends. She primarily testified about her observations of defendant
interfering with plaintiff's relationship with the children, including involving
them in the litigation and coaching them as what to discuss with experts during
evaluations. In addition, she shared her knowledge of defendant's extramarital
affairs, her attempts to stall the sale of the marital home, and defendant's
admission that she took the $60,000 from the basement safe. The friend also
testified about defendant's alleged failure to properly parent her children,
including allowing the parties' daughter to post inappropriate photos on the
Internet and to have parties with alcohol at her home.
Plaintiff also presented the testimony of the court-appointed parenting
coordinator, who appeared as a neutral third party. She described her meetings
with and evaluations of the parties as well as her attempt to work with them to
encourage the children to maintain good relationships with their parents. She
also described her contact with and assessment of the children.
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The parenting coordinator was concerned that defendant was causing the
children's alienation from plaintiff. She observed that the children were unable
to give concrete reasons for not wanting to see their father and that they repeated
things that defendant had told the parenting coordinator, using the exact same
words. She testified that she witnessed defendant engage the children in
negative conversations about plaintiff and that she found that defendant would
not follow the parenting coordinator's recommendations.
Plaintiff also called as expert witnesses a certified public account (CPA),
who evaluated the businesses and prepared a "cash flow" analysis of plaintiff's
income, and two real estate appraisers, one for the real estate the parties owned
and the other for the timeshare.
The CPA conducted an evaluation of RER and RERS, which he stated
were "intimately intertwined," requiring that they be valued jointly. He
concluded that as of March 14, 2012—when plaintiff's mother gave him her
share of RERS—their value was $830,000, but as of the date of the divorce
complaint, it was $656,000,1 due to a significant decline in income in 2012,
1
On cross-examination, the CPA testified, over plaintiff's objection, that he met
with defendant's valuation expert, who did not testify at trial, and they agreed
that RERS and RER should be valued jointly at $600,000.
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attributable to a poor economy and the need to purchase new equipment to
maintain operations.
In his cash flow analysis, the CPA determined that plaintiff's average pre-
tax cash flow for 2011 through 2013 was $331,182, and his average post-tax
cash flow was $289,434. In 2013, his monthly post-tax cash flow was $17,421.
Plaintiff's monthly payments for defendant and the children totaled $18,661,
creating a monthly deficit of $1240 without considering any of plaintiff's own
expenses, which required him to borrow money from his companies.
As of November 21, 2012, plaintiff had borrowed approximately $37,000
from the companies in the form of a shareholder loan, but by December 31,
2014, the amount had increased to $445,817, the majority of which was
borrowed to pay for the divorce, plaintiff's pendente lite support obligations, and
his own living expenses. The companies obtained that money from a line of
credit that was completely drawn down. Plaintiff was individually liable to the
companies for the loan, and his payments covered interest due to the bank. If
plaintiff did not pay the loan, that money would be treated as taxable income.
The CPA explained that he treated plaintiff's mother's $200,000 loan to the
company as income to plaintiff because the money did not go directly into one
of the companies, which increased his cash flow.
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As to the value of the real estate, plaintiff presented a licensed real estate
appraiser, who was qualified as an expert in commercial real estate valuation.
He appraised the properties located at Clark Road, Cotluss Road, and South
Corporate Drive.
Using the sales comparison approach, he valued Clark Road at $600,000.
That property was encumbered by a $200,000 interest-only mortgage. He valued
Cotluss Road using both a sales comparison approach and the income approach,
and concluded the property should be valued at $1,335,000. The balance of the
mortgage encumbering that property was $824,969 when the divorce complaint
was filed, and $779,859.20 at the time of trial. The expert appraised South
Corporate Drive at $934,000. The property had a mortgage of $599,979.06 at
the time of the divorce complaint and $591,231.65 at the time of trial .2
A different expert, a certified residential appraiser who was qualified as
an expert in appraising timeshare properties, observed that it was "almost
impossible" for an individual to sell a timeshare. He appraised the parties' five-
week interest in the Florida timeshare at $45,000 based on three comparable
sales. The timeshare had a mortgage of $254,385.24 at the time of trial.
2
As discussed below, at trial, the parties entered various stipulations that
included their agreements as to the amount of the balance of each mortgage.
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Defendant presented five fact witnesses who offered testimony about the
parties' relationship and their relationships with their children, including the
parties' daughter, defendant's father and sister, and a family friend. Another
witness explained that he was friends with the family, had purchased plaintiff's
landscaping business, and worked with plaintiff in RER. His testimony focused
on the manner in which plaintiff maintained two sets of accounting records, one
for customers who paid using credit cards and the other for those who paid in
cash.
On September 29, 2016, the court entered a dual judgment of divorce,
accompanied by its comprehensive statement of reasons in which it made
detailed findings as to all of the statutory factors relating to each of its decisions.
The court first granted plaintiff sole legal custody of the two sons with
physical custody of the older son to plaintiff, and physical custody of the
younger son to defendant. The court noted that it did not transfer physical
custody of the younger son to plaintiff because plaintiff did not seek his custody.
The court emancipated the parties' daughter effective September 1, 2016, but
left open the possibility that she could be unemancipated if she attended college.
Next, the trial court addressed support. Using the court's guidelines for
child support, it ordered plaintiff to pay defendant $224 per week in child
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support for the younger son and defendant to pay plaintiff $380 per week in
support for their older son. Thus, defendant would pay $156 per week in net
child support to plaintiff until the older son was emancipated, after which time
plaintiff would pay defendant $224 per week. The court explained that since
this was the first time a support award was being ordered by the court for the
children, the court "used the [guidelines'] teen adjustment because [the younger
son was] currently over twelve years old."
After establishing the child support amount, the court addressed alimony.
The court ordered plaintiff to pay defendant $2500 per week in alimony until
the older son was emancipated, at which time the payment would be reduced to
$1950 per week. The alimony obligation would last for seventeen years and five
months, the length of the marriage.
The court turned to the Mallamo3 adjustments sought by plaintiff and
made detailed findings that led to its conclusion that plaintiff was entitled to a
credit in the amount of $155,290 for overpayment of support pendente lite. The
court offset that amount by $25,085.09, which it found plaintiff was obligated
to pay pendente lite for certain expenses, but failed to do so.
3
Mallamo v. Mallamo, 280 N.J. Super. 8, 12 (App. Div. 1995).
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The trial court addressed ED by incorporating many of the same findings
it stated when discussing support. The court considered the establishment and
evolution of the parties' businesses and the acquisitions of their real estate and
concluded that the assets should be apportioned equally between the parties.
After accounting for various credits, the court awarded plaintiff the RER
companies and the Clark Road, South Corporate Drive, and Florida timeshare
properties. It awarded defendant the Cotluss Road property, which had equity
of almost $510,030.97, and the Lake Mohawk lot. The court also ordered
plaintiff to pay defendant $161,039.10 to make up the remainder of what she
was due under ED.
Excluded from the calculation was the marital home. The court noted that
neither party presented any expert testimony as to the Skyview Property's value.
It ordered defendant to vacate the marital home so that it could be sold without
interference, and granted plaintiff a limited power of attorney to have it listed
and sold. The court required that upon sale, plaintiff was to pay from the
proceeds the balance of the mortgage at the time the complaint was filed and
then equally share with defendant any remaining proceeds.
The JOD directed the parties to file their applications for counsel fees
post-judgment. However, as part of the JOD, the trial court required defendant
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to reimburse plaintiff for $15,500.97 in fees he had paid for forensic accountants
on her behalf, because they never produced reports.
After the submissions were made, on November 17, 2016, the court issued
an order supported by a written decision that required defendant to pay plaintiff
$2000 in attorneys' fees related to prior violations of litigant's rights and $2500
in expert fees incurred for the parenting coordinator. As indicated by the court,
"this Order in conjunction with the Judgment of Divorce constitute a final
Judgment effective the date of this Order."
Both parties filed motions for reconsideration of the JOD, including
counsel fees. On December 2, 2016, the court entered an order partially granting
and partially denying the parties' motions for reconsideration. The court
awarded plaintiff an additional $1000 in attorneys' fees for defendant's failure
to comply with the divorce judgment. These appeals followed.
II.
In our review, we defer to a trial court's factual findings, which "are
binding on appeal when supported by adequate, substantial, credible evidence."
Cesare v. Cesare, 154 N.J. 394, 412 (1998). We "do not weigh the evidence,
assess the credibility of witnesses, or make conclusions about the evidence."
Slutsky v. Slutsky, 451 N.J. Super. 332, 344 (App. Div. 2017) (quoting
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Mountain Hill, LLC v. Twp. of Middletown, 399 N.J. Super. 486, 498 (App.
Div. 2008)). This is particularly so in divorce proceedings because they
"involve[] the Family Part's 'special jurisdiction and expertise in family matters,'
which often requires the exercise of reasoned discretion." Ibid. (quoting Cesare,
154 N.J. at 413).
Our "[d]eference is especially appropriate when the evidence is largely
testimonial and involves questions of credibility." Ibid. (alteration in original)
(quoting Cesare, 154 N.J. at 412). "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.'" Cesare, 154
N.J. at 412 (alteration in original) (quoting Pascale v. Pascale, 113 N.J. 20, 33
(1988)). Thus, we will not disturb a trial court's factual findings unless we are
"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." Ibid. (quoting Rova Farms Resort, Inc. v. Investors Ins. Co., 65 N.J.
474, 484 (1974)).
III.
We first address defendant's challenge to the trial court's custody
determination. On appeal, she argues that the court's custody arrangement with
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respect to the younger son was not in his best interests and was unworkable
because although she is his custodial parent, she "is foreclosed from information
or decision making regarding [his] health, education and welfare." She asserts
that the court should have awarded joint legal custody because there was
insufficient evidence to support its findings that she and plaintiff were incapable
of communicating and cooperating with respect to the children and that she was
attempting to alienate them from plaintiff. Defendant also argues that the court
should have, sua sponte, interviewed both sons regarding their custodial
preferences. We disagree.
In its written decision, the court reviewed each of the statutory factors
under N.J.S.A. 9:2-4(c) relating to custody and made specific findings about the
parties' relationship with their children and their ability to parent together. The
court recognized that plaintiff and defendant had at one time agreed to a
parenting plan when the divorce complaint was filed, and although it was never
implemented, the court found that the agreement was evidence of each parent's
willingness to accept custody. It found that plaintiff and defendant were unable
to cooperate and that forcing them to communicate would be counterproductive.
The court ruled out an award of joint legal custody because it would not
be in the best interests of the children. It also found that defendant "conduct[ed]
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a malicious campaign" to alienate the children from plaintiff and that her
"alienation tactics casts a giant shadow over the whole custody assessment ."
According to the trial court, since the parties' separation, defendant "perpetuated
in the children's minds th[e] image of their father as a violent uncontrolled
person," which was unsupported by the evidence.
Turning to the children's preferences, the court noted that the daughter did
not want to see her father, the older son chose to live with his father , and as to
the youngest child, he was living with his mother and having alternate weekends
and a mid-week visit with his father without any problems.
We review a custody award under an abuse of discretion standard, giving
deference to the court's decision provided that it is supported by "adequate,
substantial, credible evidence" in the record. Cesare, 154 N.J. at 412. "[T]he
decision concerning the type of custody arrangement [is left] to the sound
discretion of the trial court[.]" Nufrio v. Nufrio, 341 N.J. Super. 548, 555 (App.
Div. 2001) (second and third alteration in original) (quoting Pascale v. Pascale,
140 N.J. 583, 611 (1995)). Therefore, "the opinion of the trial judge in child
custody matters is given great weight on appeal." Terry v. Terry, 270 N.J. Super.
105, 118 (App. Div. 1994). Nevertheless, "we must evaluate that opinion by
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considering the statutory declared public policy and criteria which a trial court
must consider[.]" Ibid.Under the statutory factors, courts have discretion to order joint legal and
physical custody, sole custody to one parent with parenting time for the other
parent, or "[a]ny other custody arrangement as the court may determine to be in
the best interests of the child." N.J.S.A. 9:2-4(a) to (c). The "paramount
consideration" in determining custody "is to foster the best interests of the
child." Beck v. Beck, 86 N.J. 480, 497 (1981). We generally "leave the decision
concerning the type of custody arrangement to the sound discretion of the trial
court[.]" Pascale, 140 N.J. at 611.
Joint custody requires that the parents "exhibit a potential for cooperation
in matters of child rearing." Beck, 86 N.J. at 498. The parents do not need to
have an "amicable relationship," but must "be able to isolate their personal
conflicts from their roles as parents" and ensure "that the children be spared
whatever resentments and rancor the parents may harbor." Ibid.Our review of the record demonstrates that although not a usual result, the
evidence supports the trial court's decision awarding plaintiff legal custody of
the parties' sons and there is nothing in the record to indicate that the
arrangement was contrary to their best interests. The court conducted an
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extensive evaluation of the applicable factors set forth in N.J.S.A. 9:2-4,
emphasizing the discord between the parties and defendant's attempts to alienate
the children from plaintiff, which the court found prevented them from being
able to maintain joint custody of their children. It made specific credibility
findings and rejected defendant's denials and explanations for her conduct that
was described in detail by other witnesses, including the parenting coordinator.
We reject defendant's contention that the trial court should not have
reached its determination without interviewing the parties' sons. While it is true
that when making a custody determination, "the preference of the children of
'sufficient age and capacity' must be accorded 'due weight,'" Beck, 86 N.J. at
501 (quoting N.J.S.A. 9:2-4), we discern no abuse in the court's discretion in not
doing so here. See D.A. v. R.C., 438 N.J. Super. 431, 455 (App. Div. 2014)
("the decision whether to interview a child in a contested custody case is left to
the sound discretion of the trial judge"). In this case, neither party asked for the
interviews and there was no question as to the sons' preferences, as the trial court
found that they "made their choices known" through their actions that included
the older son leaving defendant's home to live with plaintiff, where he resided
for over a year and a half before the trial, and the younger son living with
defendant and visiting with plaintiff without incident.
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IV.
We turn our attention to the issues raised about the court's child support
award. Defendant contends that the court erred by calculating child support
solely with reference to the Child Support Guidelines (Guidelines), Pressler &
Verniero, Current N.J. Court Rules, Appendix IX-A to R. 5:6A,
www.gannlaw.com (2019), even though the parties' combined net income was
more than $187,200, the highest amount to which the Guidelines apply. Plaintiff
acknowledges that the parties had a net combined income of more than
$187,200, but argues that defendant waived this argument because she did no t
raise it at trial and, in any event, the court had discretion not to make a
supplemental award above the amount contemplated by the Guidelines. We
disagree with plaintiff.
A trial court has "substantial discretion" when making a child support
award. Jacoby v. Jacoby, 427 N.J. Super. 109, 116 (App. Div. 2012) (quoting
Foust v. Glaser, 340 N.J. Super. 312, 315 (App. Div. 2001)). The court,
however, must exercise its discretion in accordance with the law. Ibid. "If
consistent with the law, such an award will not be disturbed unless it is
manifestly unreasonable, arbitrary, or clearly contrary to reason or to other
evidence, or the result of whim or caprice." Ibid. (quoting Foust, 340 N.J. Super.
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at 315-16). "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.'" Ibid. (quoting Flagg v. Essex Cty. Prosecutor, 171
N.J. 561, 571 (2002)).
Absent limited circumstances, parties by their conduct may not waive
their children's right to support. "The right to child support belongs to the child
and 'cannot be waived by the custodial parent.'" Pascale, 140 N.J. at 591(quoting Martinetti v. Hickman, 261 N.J. Super. 508, 512 (App. Div. 1993)). In
other words, "the responsibility to support runs from parent to child, not parent
to parent[.]" Id. at 592. A court must base its child support decision on an
evaluation of the child's needs and interests, not on the parents' conduct. Id. at
591.
As already noted, the trial court conducted a detailed analysis of the
statutory factors relating to an award of child support under N.J.S.A. 2A:34-23.
However, it did not address the Guidelines' requirements for parents with a
combined net income of more than $187,200. When confronted by an above-
the-Guidelines income, a "court shall apply the [G]uidelines up to $187,200 and
supplement the [G]uidelines-based award with a discretionary amount based on
the remaining family income (i.e., income in excess of $187,200) and the factors
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specified in N.J.S.A. 2A:34-23." Child Support Guidelines, Pressler &
Verniero, Current N.J. Court Rules, Appendix IX-A to R. 5:6A,
www.gannlaw.com (2019); see also Caplan v. Caplan, 182 N.J. 250, 271 (2005).
In considering the above-Guidelines amount, the law calls for the court to
"consider the factors set forth in N.J.S.A. 2A:34-23(a) to determine the amount
of the supplemental support award and then combine that amount with the
[G]uidelines-based award." Caplan, 182 N.J. at 271. "'[T]he dominant guideline
for consideration is the reasonable needs of the children, which must be
addressed in the context of the standard of living of the parties. The needs of
the children must be the centerpiece of any relevant analysis.'" Strahan v.
Strahan, 402 N.J. Super. 298, 307 (App. Div. 2008) (quoting Isaacson v.
Isaacson, 348 N.J. Super. 560, 581 (App. Div. 2002)).
Here, the court did not apply the law in its calculation of child support. It
neither calculated a supplemental amount for support nor did it explain why it
did not follow the requirements for high-income families. Under these
circumstances, we are constrained to remand for reconsideration of child support
to determine the amount of a supplemental award, if any. See Elrom v. Elrom,
439 N.J. Super. 424, 443 (App. Div. 2015).
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V.
Next, we address both parties' challenges to the trial court's alimony
determinations. Defendant argues that the court erred by ordering a reduction
in her alimony after their older son is emancipated and in relying upon plaintiff's
CIS for the parties' marital lifestyle. Plaintiff argues on cross-appeal that the
court erred because it failed to consider the income defendant will receive from
the Cotluss Road property, which it awarded to her in ED. We find no merit to
these contentions.
In determining an award of alimony, the trial court considered the factors
under N.J.S.A. 2A:34-23B and made specific findings as to each. While
addressing alimony, the trial court also made specific credibility findings. The
court found that defendant had "credibility issues throughout the entire trial." It
stated that "[t]here were constant issues of [defendant] testifying one way and
then being impeached by her own deposition testimony when she was being
cross examined." In addition, "[s]he could not remember virtually anything that
had occurred as much as four or five years previously when questioned by
plaintiff's attorney. Yet on direct testimony she was able to describe in great
detail things from twenty years ago." The court devoted two pages to addressing
defendant's credibility, giving examples and adding that it "could go on for
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pages about the gaps in [defendant's] credibility . . . ." For these reasons, when
addressing the parties' standard of living, the court gave "little credence" to the
information provided by defendant. For instance, she testified that her credit
card expenses were $5000 to $7000 per month, but the billing statements showed
expenses closer to $4000. The court therefore relied on plaintiff's CIS for the
standard of living.
The court recognized that the various businesses and properties it
allocated through ED "might be liquidated or sold to provide investment income
going forward." The court, however, "expect[ed] that much of what is liquidated
will be exhausted on attorneys' fees and experts' fees."
In its calculation of alimony, the trial court imputed $300,000 in income
to plaintiff, and $27,040 to defendant. As to defendant, the court found that she
was underemployed, "not really gainfully employed," while working twenty-
five hours per week, making $13 per hour. Nevertheless, it used that hourly rate
for a forty-hour week, fifty-two weeks per year, to establish her imputed income.
In determining plaintiff's income, the court found that the CPA
"understated" plaintiff's average income at $230,000. The court found that
although plaintiff's average income on his 1040 forms for 2012 to 2014 was
$226,280, the businesses also paid personal expenses, and he might have
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received unreported income as cash. The court explained that plaintiff's initial
CIS pegged the family's marital expenses at $17,218 per month, equal to
$206,616 per year, which the court determined would require income close to
$300,000 per year. The court credited plaintiff's and the CPA's testimony that
the companies had little debt prior to the pendente lite order, meaning that
plaintiff's income was sufficient to cover the marital expenses. Based on that
reasoning, which was supported by the CPA's cash flow analysis, the court
imputed income of $300,000 to plaintiff.
The court concluded that defendant needed alimony and plaintiff had the
ability to pay. It ordered plaintiff to pay defendant $2500 per week in alimony,
equal to $130,000 per year. The court explained that after combining the
alimony payment with defendant's imputed income, accounting for taxes and
child support, defendant would have net income of $2044 per week, which was
equal to $8857.33 per month or $106,288 per year. Comparing that sum with
her monthly expenses of $9515 would leave her "short" $657.67 per month.
With respect to plaintiff, his net income, after accounting for child support and
alimony payments, would be $2316 per week, totaling $10,036 per month or
$120,432 per year. Comparing that amount with his monthly expenses of
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$10,691 would leave plaintiff "short" $655 per month. The court advised that it
did "the best it [could] to place the parties in equipoise."
The court further explained that "[i]t would be inequitable for [defendant]
to continue to receive $2500 once [the older son] is emancipated . . . ." At that
point, defendant's weekly net income would be $2424 per week, or $10,504 per
month, almost $1000 more than her expenses. Thus, the court ordered a
reduction in the weekly alimony payment to $1950 after the older son's
emancipation. At that time, defendant's weekly net income would be $2123,
equivalent to almost $9200 per month, leaving her "short" $315 per month.
Plaintiff, by contrast, would be "short" $275. Again, the court explained that
the alimony reduction would put the parties "in substantial equipoise." Thus,
accounting for alimony and child support, plaintiff was obligated to pay
defendant $2344 per week until their older son was emancipated. After his
emancipation, plaintiff's alimony payment would be reduced to $1950 per week,
plus $284 per week in child support for the younger son, for a combined payment
of $2234 per week. The court determined that defendant was entitled to alimony
for a length of time equal to the duration of the marriage, seventeen years and
five months, beginning at the time of the first pendente lite payment in February
2013 and continuing through July 2030.
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In our review of an alimony award, we defer to a trial court's findings as
long as they are supported by substantial credible evidence in the record. Reid
v. Reid, 310 N.J. Super. 12, 22 (App. Div. 1998). Applying that standard here,
we find no reason to disturb the trial court's alimony award.
"Alimony relates to support and standard of living; it involves the quality
of economic life to which one spouse is entitled, which then becomes the
obligation of the other." Gnall v. Gnall, 222 N.J. 414, 429 (2015). "The basic
purpose of alimony is the continuation of the standard of living enjoyed by the
parties prior to their separation. The supporting spouse's obligation is set at a
level that will maintain that standard." Innes v. Innes, 117 N.J. 496, 503 (1990)
(citation omitted).
Alimony awards are governed by N.J.S.A. 2A:34-23(b), which sets forth
a list of non-exhaustive factors for a court to consider. If the court determines
that one factor is more or less relevant than the other factors, or that one factor
should be elevated over another factor, the court must "make specific written
findings of fact and conclusions of law" in that regard. N.J.S.A. 2A:34-23(b).
Initially, as we observed earlier, the trial court here conducted an
exhaustive analysis of the statutory factors. Although defendant argues that the
trial court did not properly evaluate the parties' standard of living on appeal, she
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concedes that the $2500 initial alimony award is appropriate. In doing so, she
also admits that after her child support obligation for her older son ends, the
alimony amount will exceed her requirements for support.
In any event, as to defendant's challenge to the trial court's reliance upon
plaintiff's CIS, we are satisfied that court fully explained that it relied on
plaintiff's CIS because of defendant's credibility issues. Indeed, the court found
that defendant overstated her credit card expenses in an apparent attempt to
overstate the marital standard of living, which was already substantial.
Turning to plaintiff's contention that the court erred by failing to consider
in its alimony calculation the income that defendant would receive from tenants
to the Cotluss Road property, we conclude it is unsupported by any evidence
that such income existed. Plaintiff relies exclusively on his expert's appraisal,
arguing that it shows that the Cotluss Road property generates approximately
$164,169 in rental income per year, requires $51,541 to maintain and operate,
and therefore has a net operating income of over $104,000. After accounting
for the approximately $63,401 per year in mortgage payments, plaintiff contends
that defendant should have a net income from the property of just over $41,018.
Plaintiff first raised this issue in his motion for reconsideration, which the
court rejected. In its oral decision, the court explained that at trial, plaintiff
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"minimized the income received from the property." For instance, plaintiff's
expert "indicated the cash flow income [from the property] was de minimis."
Moreover, citing Steneken v. Steneken, 183 N.J. 290 (2005), the trial court noted
that because plaintiff's real estate appraiser used an income approach to appraise
the property, there was a question "whether income used in calculating a value
of a property for equitable distribution should be used again in a calculation of
alimony." The court concluded:
If, in fact, it is shown down the road that defendant has
income from her operation of . . . Cotluss Road, it may
be a basis for a prayer for modification, but the Court
actually does not expect her to operate the property, but
expects that she's going to sell it. Even if she doesn't,
though, it's premature.
We agree with the trial court's conclusion. Moreover, we observe that
plaintiff's expert's cash flow analysis stated that plaintiff had no net income from
the property in 2012 and 2013. The expert explained that there was income in
2011, but it was due primarily to pre-existing cash in the bank and money
borrowed when the mortgage was refinanced, not from rental income. The
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testimony of plaintiff's own expert established that the Cotluss Road property
generated little or no rental income. 4
VI.
We next focus on the parties' challenges to the trial court's ED
determinations. Defendant argues that the court erred by: (1) denying her the
opportunity to present expert testimony on the valuation of the businesses; (2)
awarding plaintiff Mallamo credits for pendente lite support; (3) requiring her
to assume any of the debt associated with the timeshare in Florida; and (4)
finding that she took $60,000 out of the basement safe. On cross -appeal,
plaintiff argues that the court erred by failing to provide him with a credit for
his pay down of the mortgage on the Cotluss Road property. He also argues that
the court erred by failing to provide him with a credit for the cost of repairs to
the marital home and failing to require defendant to share any loss from the sale
of the house.
4
In the supplemental appendix plaintiff filed with his reply brief, he i ncludes
post-trial certifications defendant filed with the trial court in which she stated
that the Cotluss Road property generated income. Defendant, in her reply brief,
argues that the property was in disrepair and that she had to expend significant
funds to upgrade it and to refinance the mortgage on the property as plaintiff
requested; she includes in her supplemental appendix pictures of the property
and invoices that were not part of the trial record. The arguments advanced in
the parties' reply briefs are based on materials in the supplemental appendices
that were not before the trial court; therefore, they are not considered on appeal.
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A.
We begin our review of the ED award by addressing defendant's
contention about the trial court barring her from producing an expert. We
discern the following facts from the record.
On September 4, 2015, the court barred plaintiff from presenting a
forensic accountant. The court explained that it "reluctantly" entered the order
after "having given the defendant multiple opportunities to provide a valid
expert report on the issue of the business valuation only to have her present in
the summer of 2015 a document the [c]ourt concluded was nothing more than a
net opinion."5
The "multiple opportunities" began early in the matter. Throughout the
pendency of the matter, the trial court entered orders enabling plaintiff to pay
for an expert, as long as defendant retained an expert with courts approval. The
court made clear that defendant was free to retain an expert of her choosing, but
if she wanted plaintiff to advance sums for that purpose, she had to make
application to the court. Rather than follow the court's procedure, in 2013,
defendant chose to retain unilaterally her own forensic accountant, and paid him
5
Although defendant refers to the court's comment in her appellate brief, she
does not set forth any argument about why the court was wrong, nor did she
provide us with a copy of the report in her appendix.
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a $5000 retainer. She then filed a motion seeking reimbursement from plaintiff,
which the court denied.
By May 2015, defendant did not serve an expert report. On May 3, 2015
and May 29, 2015, the court entered orders requiring defendant to provide
plaintiff with her expert's report by July 3, 2015. Despite having paid the expert
$9000, defendant retained a new expert to replace him and paid another $5000
retainer. Yet, defendant never produced a report.
Under these circumstances, we find no abuse of the trial court's discretion
in barring defendant from relying upon expert testimony. Pomerantz Paper
Corp. v. New Cmty. Corp., 207 N.J. 344, 371-72 (2011). Even if we did, we
would find the error harmless. R. 2:10-2. The trial court's reliance on plaintiff's
experts was more prejudicial to plaintiff than defendant. If defendant was
correct, the court's reliance on plaintiff's experts' values resulted in plaintiff
receiving overvalued assets in satisfaction of his ED award. For example,
plaintiff's CPA valued the business at $656,000, which was higher than the value
purportedly ascribed by defendant's own expert. Similarly, if defendant is
correct that $1,335,000 was a "low-ball" value for Cotluss Road, that valuation
also benefitted her because the court awarded her that property in ED.
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Moreover, plaintiff has produced no evidence in the record that she suffered any
harm.
B.
Next, we address defendant's contention that the court erred by providing
plaintiff with a Mallamo credit for overpayment for pendente lite support. In
Mallamo, we explained that pendente lite support awards may be entered based
upon the parties' submissions without a plenary hearing, and are subject to
modification prior to final judgment based on the actual evidence adduced at
trial. Mallamo, 280 N.J. Super. at 12. Defendant claims that the court based its
decision to award plaintiff Mallamo credits on its misunderstanding of the
shareholder loans plaintiff took out from the businesses. We disagree.
Contrary to defendant's contention, the court did not base its decision on
the loans. In fact, in its decision, the court indicated that it was not awarding
plaintiff any credit for the shareholder loans specifically because it awarded him
Mallamo credits. Instead, under Mallamo, the court found that plaintiff had
overpaid defendant's pendente lite support based on the evidence adduced at trial
about the marital lifestyle, defendant's needs, and plaintiff's ability to pay. As
explained by plaintiff and his expert, the loans were taken so that plaintiff could
pay support for defendant and the children pendente lite, as well as to pay his
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own expenses, which included his legal fees. Defendant's arguments that
somehow the true nature of the loans were hidden or disguised are simply
without any merit.
C.
We turn to the parties' contentions about the errors made by the trial court
in distributing their property. At the outset, we acknowledge that "[a] Family
Part judge has broad discretion . . . in allocating assets subject to equitable
distribution." Clark v. Clark, 429 N.J. Super. 61, 71 (App. Div. 2012). We will
"reverse only if we find the trial judge clearly abused his or her discretion, such
as when the stated 'findings were mistaken[,] . . . the determination could not
reasonably have been reached on sufficient credible evidence present in the
record[,]' or the judge 'failed to consider all of the controlling legal
principles[.]'" Id. at 72 (alterations in original) (quoting Gonzalez-Posse v.
Ricciardulli, 410 N.J. Super. 340, 354 (App. Div. 2009)).
In its calculation of the properties' values, the trial court applied various
stipulations that the parties agreed to pre-trial. Those stipulations included the
following facts: the Lake Mohawk lot was worth $6500; the Florida timeshare
had a mortgage of $273,000 at the time of the complaint, which plaintiff paid
down to approximately $254,385 during litigation; the Clark Road property
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owned by CRR was encumbered by a $200,000 mortgage; the Cotluss Road
property had a mortgage of approximately $824,969 6 as of the date of the
complaint; and the South Corporate Drive property had a mortgage balance of
approximately $599,979 at the time of the complaint that plaintiff paid down
during litigation to $591,232.
In determining the properties' values, the court relied solely upon
plaintiff's experts' testimony as defendant did not present any evidence to refute
their opinions. As a result, it determined the timeshare's value was $45,000; the
Clark Road property's value was $400,000; the Cotluss Road property's was
$510,000; and South Corporate Drive was $934,000.
In determining the parties' businesses' values, the court accepted the
CPA's $656,000 valuation of the two RER companies, though the court found
the valuation "suspect" because it was done for negotiation purposes . The court
found it significant and "somewhat astounding" that on cross-examination,
defendant's counsel elicited testimony from the CPA that defendant's forensic
6
Plaintiff argued that he was entitled to a credit for paying down the mortgage
during litigation, but the court did "not recall the evidence that support[ed] the
pay down amount and the stipulation only ha[d] the amount of the mortgage as
of the date of the complaint."
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accountant, who did not testify, agreed with him that the RER companies should
be valued at $600,000.
The trial court calculated and applied credits to which plaintiff was
entitled before reaching a bottom line as to ED. Among them was the Mallamo
credit in the net amount of approximately $130,205, and a credit for $30,000 for
one-half the $60,000 the court found defendant took from the safe in the
basement. The court also credited plaintiff approximately $15,500 for money
he paid to the court-appointed forensic accountant on defendant's behalf and to
defendant's forensic accountant directly, neither of whom produced a report.
The court then apportioned all assets equally between the parties. It added
up the net value of all of the properties and businesses and divided that amount
in half, finding that each party was entitled to the equivalent of $953,275.95.
Next, it subtracted $100,000 from defendant's portion, representing her share of
the negative equity in the Florida timeshare. It further subtracted from her share
the various credits owed to plaintiff. Accounting for those adjustments,
defendant was due the equivalent of $677,570.07 in ED.
In a divorce judgment, courts are directed to "effectuate an [ED] of the
property, both real and personal, which was legally and beneficially acquired by
them or either of them during the marriage." Steneken, 183 N.J. at 299 (quoting
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38
Painter v. Painter, 65 N.J. 196, 205 (1974)). The goal of ED "is to effect a fair
and just division of marital [property]." Elrom, 439 N.J. Super. at 444
(alteration in original) (quoting Steneken, 183 N.J. at 299). Courts must
"identify the marital assets, determine the value of each asset, and then decide
'how such allocation can most equitably be made.'" Ibid. (quoting Rothman v.
Rothman, 65 N.J. 219, 232 (1974)).
Under N.J.S.A. 2A:34-23.1, courts are required to make "findings of fact
on the evidence relevant to all issues pertaining to asset eligibility or
ineligibility, asset valuation, and [ED]" after considering the factors delineated
in the statute.
Florida Timeshare
Defendant asserts that the court erred by awarding plaintiff the Florida
timeshare and requiring her to contribute $100,000 towards the outstanding
mortgage and at the same time depriving her of the use of the timeshare. We
disagree.
As already noted, before trial, the parties stipulated to the mortgage
balance on the timeshare. Plaintiff's expert appraised the five-week timeshare
interest at $45,000, so it had negative equity of $209,385.24. In its ED award,
the court calculated the equity in the timeshare by subtracting the amount of the
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39
outstanding mortgage from the value of the property, an approach that defendant
does not question for any of the other properties. The only difference was that
the mortgage on the timeshare was higher than its appraised value, so whichever
party received the timeshare was entitled to a credit from the other party for half
the amount of the negative equity. Because the court awarded the timeshare to
plaintiff, he was entitled to the credit.
We find no merit to defendant's contention that since she had to contribute
to the debt, she should be allowed to use the timeshare. First, at trial, plaintiff
testified to the significant expenses required to use the timeshare over and above
the mortgage payments, including approximately $20,000 per year in dues, plus
an additional $24,000 for activities and food. The fact that the mortgage was
netted out from the value and defendant had to share in the negative equity did
not give rise to a right to use the distributed property, especially without sharing
in its expenses. Second, and more important, "[i]t seems almost doctrinal that
the elimination of the source of strife and friction is to be sought by the judge in
devising the scheme of [equitable] distribution, and the financial affairs of the
parties should be separated as far as possible." Bowen v. Bowen, 96 N.J. 36, 41
(1984) (quoting Borodinsky v. Borodinsky, 162 N.J. Super. 437, 443 (App. Div.
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1978)). Defendant's argument, if accepted, would insert plaintiff and defendant
back into each other's financial affairs, which ED was intended to eliminate.
The Safe
Defendant argues that there was insufficient evidence to support the
court's finding that she took $60,000 from the safe in the basement, and that the
court therefore erred by awarding plaintiff a credit of $30,000.
We conclude that defendant's argument is without sufficient merit to
warrant discussion in a written opinion. R. 2:11-3(e)(1)(E). Suffice it to say,
the trial court did not abuse its discretion in relying upon the evidence it found
credible rather than accepting defendant's inconsistent explanations about the
money in the safe. The court's credibility determinations were supported by
credible evidence, and there is no basis to question them on appeal.
Cotluss Road Property Mortgage Pay Down
On cross-appeal, plaintiff contends that the court erred by not granting his
motion for reconsideration and amending the judgment to account for a
$60,057.23 reduction of the mortgage on the Cotluss Road property during
litigation. Plaintiff argued that he was entitled to a credit for paying down the
mortgage during litigation.
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The trial court did "not recall the evidence that supports the pay down
amount and [noted that] the stipulation only has the amount of the mortgage as
of the date of the complaint." The court also stated there was no testimony at
trial about the reduction, as confirmed by the fact that plaintiff, who now had
the benefit of the trial transcripts, could "not reference a transcript page with
any information regarding the issue." The court acknowledged that plaintiff
identified "footnote 12 of 18 footnotes on the case information statement [ t]o
reach his final number of $60,[0]57.23, [and that plaintiff] attaches a document
not part of the trial record," but refused to accept that as evidence adduced at
trial since there was no testimony about either.
A motion for reconsideration is governed by Rule 4:49-2 and "is a matter
within the sound discretion of the [c]ourt, to be exercised in the interest of
justice." D'Atria v. D'Atria, 242 N.J. Super. 392, 401 (Ch. Div. 1990). Litigants
"should not seek reconsideration merely because of dissatisfaction with a
decision of the [c]ourt." Ibid. Instead,
[r]econsideration should be utilized only for those cases
which fall into that narrow corridor in which either 1)
the [c]ourt has expressed its decision based upon a
palpably incorrect or irrational basis, or 2) it is obvious
that the [c]ourt either did not consider, or failed to
appreciate the significance of probative, competent
evidence.
[Ibid.]
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On reconsideration, a litigant must specify "the matters or controlling
decisions which counsel believes the court has overlooked or as to which it has
erred[.]." R. 4:49-2. Reconsideration "cannot be used to expand the record . . ."
Capital Fin. Co. of Del. Valley v. Asterbadi, 398 N.J. Super. 299, 310 (App.
Div. 2008). It is "designed to seek review of an order based on the evidence
[that was] before the court . . . , not to serve as a vehicle to introduce new
evidence in order to cure an inadequacy in the . . . record." Ibid. The court may
consider new evidence "in the interest of justice" only if it "could not have
[been] provided on the first application[.]" D'Atria, 242 N.J. Super. at 401.
We conclude that the trial court was incorrect in denying reconsideration.
During trial, plaintiff testified that as of September 2015, the mortgage on the
Cotluss Road property was $779,859.20, and referenced a bank statement
attached to his CIS that showed the amount outstanding on the loan. The amount
was $45,109.83 7 less than the stipulated amount that existed at the time plaintiff
7
Neither plaintiff's testimony, nor the CIS and bank statements, however,
supported his claim that he paid the Cotluss Road mortgage down by
$60,057.23. The evidence only supported a pay down amount of $45,109.83.
Although plaintiff attempted to justify the higher amount by attaching the bank
statement from July 2016, that document was not part of the record at trial.
Plaintiff may not introduce new evidence on a motion for reconsideration that
he could have introduced at trial. Asterbadi, 398 N.J. Super. at 310.
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43
filed his complaint. Plaintiff further testified at trial, referring to his CIS,
including footnote twelve, that the property was worth approximately $555,141,
representing the $1,335,000 "appraised value of the property net of the mortgage
balance of seven seventy-nine eight fifty-nine." Thus, there was testimony
highlighting plaintiff's contention and documentary evidence, consisting of the
CIS and attached bank statement, which were admitted into evidence. Since the
court inadvertently overlooked the evidence, it should have granted that aspect
of plaintiff's motion for reconsideration. For that reason, we must remand the
matter for the court to recalculate the ED net amount owed by plaintiff to
defendant.
Repairs and Sale of Marital Home
Plaintiff contends that reconsideration was also improperly denied
because he was entitled to a credit for repairs to the marital home and that the
court should have apportioned half of any loss from the sale of the house to
defendant. On appeal, he claims, without any evidentiary support, that at the
recommendation of the realtor he spent $60,000 to repair the marital home .
Plaintiff also includes in his appendix the Closing Settlement Statement (HUD-
1 form) from the November 3, 2017 sale of the Skyview Property, indicating its
sale for $910,000.
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We conclude that plaintiff's contention that he is now entitled to repair
credits under the JOD is without sufficient merit to warrant discussion in a
written opinion. R. 2:11-3(e)(1)(E). We only note that we agree with the trial
court that at trial, plaintiff "provide[d] no information" or "evidence" about any
repairs to the house. Moreover, at the time of reconsideration, there was no
evidence that any actual repairs had been made or were needed in order to sell
the house. His motion was inappropriate for reconsideration and premature.
VII.
Defendant and plaintiff both challenge the court's ruling on counsel fees.
Defendant argues that the court erred by failing to require plaintiff to pay her
legal fees and by ordering her to pay a portion of his legal fees due to her
violations of litigant's rights. Plaintiff argues on cross-appeal that the court
erred by failing to order defendant to pay him additional attorneys' fees because
of her bad faith litigation tactics throughout trial. We disagree with both parties'
contentions.
During the course of the litigation, the trial court entered orders at various
points requiring defendant to pay plaintiff's counsel fees totaling approximately
$4500, attributable to her failure to abide by court orders. On November 17,
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45
2016, the court entered a supplemental order on counsel fees that awarded
plaintiff $2000 in additional fees.
In the trial court's statement of reasons accompanying its November 16
order, the court explained that it was "unfortunate" that the parties incurred legal
fees approaching one million dollars, but "not surprising due to the level of
hostility." The court stated it was "loathe to shift fees based upon
unreasonableness of positions alone when both parties contributed to negotiation
stalemates." It rejected both parties' requests for additional attorneys' fees. It
found the award of any additional fees to either party "problematic" because
they both took unreasonable positions and would be "hard pressed" to pay their
own legal fees.
The court was also troubled by the "disparity in hours and fees
disproportionately heavy for plaintiff," observing that defendant retained four
different attorneys, and they billed for approximately 644 hours of time , while
plaintiff retained two attorneys, who billed approximately 2180 hours.
Defendant's attorneys charged in the range of $185 to $375 per hour, and
plaintiff's attorneys charged in the range of $250 to $550. Plaintiff incurred
approximately $740,000 in attorneys' fees, and defendant incurred
approximately $230,000. Plaintiff paid his attorneys almost $400,000, and
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would "struggle to pay [defendant's] Court ordered support and then the balance
of his fees." Defendant paid approximately $75,000, and would "struggle to pay
the unpaid portion of her fees and repay the loans" provided by her father.
However, the court found that defendant was partially responsible due to her
bad faith tactics, which included alienating the children, violating court orders,
and consistently retaining new counsel. The court consequently awarded
plaintiff an additional $2000 in counsel fees, and indicated that it would have
assessed more if plaintiff had been able to document his additional fees that were
attributable to defendant's conduct. The court also ordered defendant to pay
$2500 for the parenting coordinator's fees.
We defer to a trial court's determination on counsel fees in a matrimonial
action, and will only disturb it "on the 'rarest occasion,' and then only because
of clear abuse of discretion." Strahan, 402 N.J. Super. at 317 (quoting Rendine
v. Pantzer, 141 N.J. 292, 317 (1995)).
A trial court may award reasonable attorney's fees in actions in the Family
Part. N.J.S.A. 2A:34-23; R. 5:3-5(c); see also R. 4:42-9. When deciding if
attorney's fees should be awarded, "the court must look at the requesting party's
need, the other party's ability to pay and the good and bad faith of each party."
Heinl v. Heinl, 287 N.J. Super. 337, 349 (App. Div. 1996).
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Rule 5:3-5(c) also provides that:
the court should consider, in addition to the information
required to be submitted pursuant to R[ule] 4:42-9, the
following factors: (1) the financial circumstances of the
parties; (2) the ability of the parties to pay their own
fees or to contribute to the fees of the other party; (3)
the reasonableness and good faith of the positions
advanced by the parties both during and prior to trial;
(4) the extent of the fees incurred by both parties; (5)
any fees previously awarded; (6) the amount of fees
previously paid to counsel by each party; (7) the results
obtained; (8) the degree to which fees were incurred to
enforce existing orders or to compel discovery; and (9)
any other factor bearing on the fairness of an award.
Applying these guiding principles, we conclude that the parties' arguments
about counsel fees are without merit and that the trial court did not abuse its
discretion in limiting the award of counsel fees in this matter, substantially for
the reasons expressed by the court in its statement of reasons.
VIII.
In sum, we affirm almost every aspect of the trial court's thoughtful
determinations. We are constrained to vacate its award of child support and
remand for recalculation using above-the-Guidelines considerations. We also
vacate the ED award of the net amount payable by plaintiff to defendant and
direct that the amount be reduced by one half of the reduction in the Cotluss
Road property or $22,555.
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48
Affirmed in part; vacated and remanded in part for further proceedings
consistent with our opinion. We do not retain jurisdiction.
A-1578-16T2
49