Kozel, D. v. Kozel, D. , 2014 Pa. Super. 161 ( 2014 )

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2014 Pa. Super. 161
DEBORAH L. KOZEL IN THE SUPERIOR COURT OF
PENNSYLVANIA
Appellee
v.
DAVID F. KOZEL
Appellant No. 461 WDA 2013
Appeal from the Order Entered February 12, 2013
In the Court of Common Pleas of Allegheny County
Family Court at No(s): FD 98-00761-004
BEFORE: BENDER, P.J.E., LAZARUS, J., and MUNDY, J.
OPINION BY LAZARUS, J. FILED JULY 29, 2014
David F. Kozel (Husband) appeals from the order of the Court of
Common Pleas of Allegheny County denying his motion for summary
judgment, which permitted Deborah L. Kozel (Wife) to go forward with her
petition for special relief seeking imposition of a constructive trust. After
careful review, we affirm.
The trial court summarized the underlying facts and procedural history
of the case as follows:
The parties were married on July 30, 1994, separated on
September 9, 1998 and were divorced by final decree on April 4,
2002. Master Gary Gilman held a nine-day hearing on the issues
of equitable distribution, alimony, counsel fees and contempt in
late 2004 and early 2005. Master Gilman issued Findings of Fact
Regarding Equitable Distribution, Alimony, Counsel Fees and
Conte
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exceptions were granted in part. Wife then appealed and
Husband cross-appealed to the Pennsylvania Superior Court.
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The Superior Court affirmed
2007.
On November 16, 2012, Wife presented a Petition asserting
section 3505(d) of the Divorce Code, 23 Pa.C.S. § 3505(d),
required by general rule of the Supreme Court and in
consequence thereof an asset or assets with a fair market value
of $1,000 or more is omitted from the final distribution of
property . . . [t]he Court shall grant the petition [for imposition
of a constructive trust] upon a finding of a failure to disclose the
Petition claims that Husband failed to disclose his legal or
non-disclosures necessitate the imposition of a constructive trust
as to the following assets:
a. Falcon Partners;
b. Gulf Keystone Petroleum Ltd., GPK, LLC, Gulf
Keystone, and related entities;
c. Other gas interests/wells and partnerships; and
d. Other assets of which Wife has at this time no
knowledge, but as to which she will conduct discovery
in this matter. See
Husband filed a Motion for Summary Judgment, dated December
limitations of Section 3332 of the Divorce Code, 23 Pa.C.S. §
3332, Opening or Vacating Decrees, which requires that any
action claiming intrinsic fraud be filed within 30 days of the
divorce decree and any action claiming extrinsic fraud be filed
within 5 years of the final decree.
Trial Court Opinion, 5/13/13, at 1-2. 1
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1
petition for special relief raising substantially the same issues that he raised
in his motion for summary judgment.
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order dated February 12, 2013. Shortly thereafter, Husband filed a motion
to amend the order to state that it involves a controlling question of law as
to which there is a substantial ground for difference of opinion and that an
immediate appeal may materially advance the ultimate termination of the
matter. See 42 Pa.C.S. § 702(b)(1). The court issued an order to this
effect on March 13, 2013. Husband filed a timely notice of appeal on March
petition for permission to appeal.2
Husband raises the following issues for our review:
1. Whether an action brought under the constructive trust
provision of the Divorce Code, 23 Pa.C.S. § 3505(d), seven
years after the final equitable distribution order, based solely
on allegations of fraud, is barred by the statute of limitations
provision of the Divorce Code, 23 Pa.C.S. § 3332, related to
fraud claims.
2.
motion for summary judgment where there was no genuine
Partners was fully disclosed in discovery and included in the
order of equitable distribution.
3.
motion for summary judgment where there was no genuine
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2
The order, docketed at 28 WDM 2013, provided:
Upon consideration of the Petition for Permission to Appeal, the
petition is hereby GRANTED. The matter shall proceed before
this Court at docket number 461 WDA 2013 as an appeal from
the order dated February 12, 2013.
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issue of material fact that Gulf Keystone Petroleum, Ltd., or
GPK, LLC, did not exist at the time of the marriage.
4.
motion for summary judgment where there was no genuine
well interests and partnerships was fully disclosed in
discovery and included in the order of equitable distribution.
5.
motion for summary judgment where Wife failed to state a
as
Brief of Appellant, at 6-7.
Wife filed her petition for special relief based on section 3505 of the
Divorce Code, which provides in relevant part:
§ 3505. Disposition of property to defeat obligations
(d) Constructive trusts for undisclosed assets. If a party fails
to disclose information required by general rule of the Supreme
Court and in consequence thereof an asset or assets with a fair
market value of $1,000 or more is omitted from the final
distribution of property, the party aggrieved by the
nondisclosure may at any time petition the court granting the
award to declare the creation of a constructive trust as to all
undisclosed assets for the benefit of the parties and their minor
or dependent children, if any. The party in whose name the
assets are held shall be declared the constructive trustee unless
the court designates a different trustee, and the trust may
include any terms and conditions the court may determine. The
court shall grant the petition upon a finding of a failure to
disclose the assets as required by general rule of the Supreme
Court.
23 Pa.C.S. § 3505(d).
ownership of certain property brings her petition for constructive trust within
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Husband disagrees, and argues that the relief Wife seeks is controlled by
section 3322 of the Divorce Code, which provides:
§ 3322. Opening or vacating decrees
A motion to open a decree of divorce or annulment may be made
only within the period limited by 42 Pa.C.S. § 5502 (relating to
modification of orders) and not thereafter. The motion may lie
where it is alleged that the decree was procured by intrinsic
fraud or that there is new evidence relating to the cause of
action which will sustain the attack upon its validity. A motion to
vacate a decree or strike a judgment alleged to be void because
of extrinsic fraud, lack of jurisdiction over the subject matter or
a fatal defect apparent upon the face of the record must be
made within five years after the entry of the final decree.
Intrinsic fraud relates to a matter adjudicated by the judgment,
including perjury and false testimony, whereas extrinsic fraud
relates to matters collateral to the judgment which have the
consequence of precluding a fair hearing or presentation of one
side of the case.
23 Pa.C.S. § 3322.
Initially, we note that Wife does not seek to vacate the divorce decree,
which is the relief provided under section 3322. Rather, she seeks a
constructive trust, which is the relief provided under section 3505. Major v.
Major, 518 A.2d 1267 (Pa. Super. 1986), supports the proposition that
section 3505 is an alternative and distinct cause of action to section 3332.
In Major, wife sought relief under the predecessor to section 3322,3 seeking
to reopen equitable distribution because husband had failed to mention his
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3
1980, April 2, P.L. 63, No. 26 § 602 (23 P.S. § 602).
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4
Id. at 1269. This Court held
that wife was not entitled to relief under the predecessor to section 3332
not argued that fraud was perpetrated; [and] 3) she presents no new
evidence relating to the cause of act Id. at 1272. Nevertheless, this
Court held that the appropriate remedy was a constructive trust under the
predecessor to section 3505.5
court of competent jurisdiction is presented with facts warranting its
Id. at 1274.
Importantly, the facts warranting impo
not include a requirement that the failure to disclose an asset be a deliberate
or intentional effort to avoid subjecting funds to the equitable distribution
Creeks v. Creeks, 619 A.2d 754, 757 (Pa. Super. 1993). The
intent of the party who fails to disclose the assets is of no moment. Id.
Husband relies on Hassick v. Hassick, 695 A.2d 851 (Pa. Super.
is not entitled to relief. We disagree because significant distinctions exist
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4
Major involved a bifurcated divorce. The divorce decree was entered on
December 2, 1982. The equitable distribution order was entered on March
29, 1983, and wife sought to reopen equitable distribution on October 17,
1983.
5
1980, April 2, P.L. 63, No. 26 § 403 (23 P.S. § 403).
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between the instant matter and Hassick, where, fourteen years after the
parties executed a property settlement agreement, wife filed a petition for
special relief alleging that her husband fraudulently concealed a pension.
id.
at 853, but relied on Major, Creeks, and section 3505 to grant wife a fifty
percent interest in the pension, and imposed a constructive trust until the
pension reached pay status. On appeal, this Court reversed, in part because
Majors and Creeks did not involve allegations of fraud, and in part because
an excessive period of time had passed between the final decree and the
petition for relief. The Court further noted that relief was only available
under section 3505(d) if a party had failed to disclose information regarding
as was then required by section 3505(b). Because neither party in Hassick
of a constructive trust.6 In summary, Hassick is not a section 3505(d)
case, and accordingly, it cannot serve as a basis for denying Wife the
opportunity to seek relief under section 3505(d).
Husband further argues that sections 3505 and 3323 should be read in
pari materia, pursuant to section 1932 of the Statutory Construction Act, 1
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6
The inventory and appraisment formerly required under 23 Pa.C.S. §
3505(b) has been suspended and is now governed by Pa.R.C.P. 1920.33,
which provides for filing of an inventory of all assets and a pre-trial
statement containing a valuation of those assets.
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rules of statutory construction, the necessity of applying the rule as to the
construction of statutes in pari materia exists only where the terms of the
Oliver v. City of Pittsburgh, 11
A.3d 960, 965 (Pa. 2010) (citing AM.JUR.2D Statutes
words of a statute are clear and free from all ambiguity, the letter of it is not
1921(c). Here, the language of section 3505 is unambiguous. When a party
fails to disclose information required by a general rule of the Supreme Court,
such as the Rules of Civil Procedure governing identification and valuation of
assets, and as a result of the nondisclosure an asset with a fair market value
of $1000 or more is omitted from the final distribution, the aggrieved party
at any time petition the court granting the award to declare the
3505(d) (emphasis added). Accordingly, the plain language of section
in pari
materia with section 3332. Oliver, supra.
Having concluded that Wife properly sought relief under section
t the trial court erred in denying
his motion for summary judgment.
Our standard of review of an order granting or denying a motion for
summary judgment is well-settled:
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We view the record in the light most favorable to the nonmoving
party, and all doubts as to the existence of a genuine issue of
material fact must be resolved against the moving party. Only
where there is no genuine issue as to any material fact and it is
clear that the moving party is entitled to a judgment as a matter
of law will summary judgment be entered. Our scope of review
order will be reversed only where it is established that the court
committed an error of law or abused its discretion.
Daley v. A.W. Chesterton, Inc., 37 A.3d 1175, 1179 (Pa. 2012) (citation
omitted).
Pa.R.C.P. 1035.2 governing motions for summary judgment provides:
After the relevant pleadings are closed, but within such time as
not to unreasonably delay trial, any party may move for
summary judgment in whole or in part as a matter of law
(1) whenever there is no genuine issue of any material
fact as to a necessary element of the cause of action
or defense which could be established by additional
discovery or expert report; or
(2) if after the completion of discovery relevant to the
motion, including the production of expert reports,
an adverse party who will bear the burden of proof
at trial has failed to produce evidence of facts
essential to the cause of action or defense which in a
jury trial would require the issues to be submitted to
a jury.
Pa.R.C.P. 1035.2.
Here, the trial court determined there are genuine issues of material
fact that require discovery, and therefore it denied Husba
summary judgment.
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With respect to the existence of disputed material facts regarding
court, which noted:
The Master found that Husband transferred his interest in 1998
to his brothers for no consideration. See
Recommendations, p. 10, footnote 3. The Master found that
-Six Thousand Eight
Hundred Eight Dollars ($46,808) based on the assertion by
Husband that he did not have current or ongoing interest in the
asset. See [Id.], paragraphs 79-85, pp. 23-24. Wife claims
that shortly after the entry of the final Trial Court order of
September 27, 2005 disposing of the Exceptions and Cross-
in Falcon to an entity called Pioneer I Associates Trust, a trust of
which Husband is the beneficiary. See
paragraph 17. Wife asse
would provide Husband all of the rights and benefits of actual
ownership in the interim, and Todd would then convey Falcon to
Husband as soon as his divorce was concluded. See
Petition. This Court acted within its discretion in determining
that an issue of genuine material fact exists with regard to both
ivorce planning. These are
issues for discovery in accordance with the standard for
summary judgment set forth in Pa.R.C.P. 1032.2.
Trial Court Opinion, 5/13/13, at 9-10.
In her petition, Wife avers that prior to separation on September 9,
1998, and afterward, Husband had a legal and/or equitable ownership
interest in Gulf Keystone and related entities that he failed to disclose. See
Robert Kozel, in which he states
that Gulf Keystone was established in approximately 1997. However,
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Husband asserts that he could not have had such an interest because Gulf
Keystone did not exist until January 2000. See Motion for Summary
Judgment, at paragraph 44. Even assuming this to be true, Husband
trial, and therefore had an affirmative duty to disclose this interest. See
Pa.R.C.P. 1920.33. Accordingly, the trial court did not err or abuse its
discretion in finding there were genuine issues of material fact that need to
be determined through additional discovery.
Wife also sought relief on the basis that Husband may have owned
more gas wells and related interests than he disclosed in his inventory,
marital asset summary and pretrial statement. See -
40. She based her claim on averments in a lawsuit for specific performance
unrelated plaintiffs aver that on April 1, 2004, Husband and his brothers
agreed to sell approximately 592 natural gas wells. Id. Based on this
information, Wife has established a genuine issue of material fact as to when
Husband acquired his interest in these assets. Furthermore, even if the sale
of these assets was completed on April 1, 2004, it occurred before the
equitable distribution hearing and thus should have been disclosed pursuant
Section
3505(d). Accordingly, the trial court did not err or abuse its discretion in
all his interests in natural gas wells.
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discretion by not
granting his motion for summary judgment where Wife failed to state a
cause of action for a constructive trust on assets not otherwise specified. If
Wife had simply sought a constructive trust on unspecified assets, we might
have been p
finding that Husband engaged in divorce planning, the trial court did not err
as a matter of law or abuse its discretion in denying summary judgment,
thus allowing the parties to engage in discovery.
Order affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 7/29/2014
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