NARSAN LINGALA VS. SAROJA ALKANTIÂ (FM-12-2371-11, MIDDLESEX COUNTY AND STATEWIDE)

NOT FOR PUBLICATION WITHOUT THE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-4643-14T3
NARSAN LINGALA,
Plaintiff-Appellant,
v.
SAROJA ALKANTI, f/k/a
SAROJA LINGALA,
Defendant-Respondent.
________________________________
Submitted May 15, 2017 – Decided June 16, 2017
Before Judges Haas and Geiger.
On appeal from Superior Court of New Jersey,
Chancery Division, Family Part, Middlesex
County, Docket No. FM-12-2371-11.
Keith, Winters & Wenning, LLC, attorneys for
appellant (Brian D. Winters, on the briefs).
Bhavini Tara Shah, attorney for respondent.
PER CURIAM
Plaintiff Narsan Lingala appeals from a May 28, 2015 order
denying his post-judgment motion to set aside a matrimonial
settlement agreement ("MSA") entered into by the parties on July
10, 2012. We affirm.
Plaintiff and defendant Saroja Alkanti, formerly known as
Saroja Lingala, were married on December 2, 1995. They had two
children, a son born in 1997 and a daughter born in 2003. Plaintiff
filed a complaint for divorce on May 9, 2011. Defendant filed an
answer and counterclaim. This heavily litigated divorce action
was the subject of numerous pretrial and post-judgment motions.
The pretrial motions included several discovery enforcement
motions filed by defendant to obtain financial information
regarding plaintiff's business and income. Both parties filed
post-judgment motions to enforce various provisions of the MSA.
Prior to trial, the parties participated in a matrimonial
early settlement panel, R. 5:5-5, and economic mediation with a
private mediator, both of which were unsuccessful.
The trial began on June 25, 2012, but the parties reached a
global settlement before the trial was completed. Plaintiff takes
issue with certain events that transpired during the trial after
the trial judge learned there was an outstanding warrant for the
arrest of plaintiff for violating a final restraining order entered
against him in Massachusetts.1 Plaintiff was placed under arrest
and removed from the courtroom for processing. Plaintiff then
1
Notably, plaintiff was not a party to the Massachusetts
proceeding in which the final restraining order and arrest warrant
were issued.
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returned to the courtroom handcuffed. The trial then continued
that afternoon.
The trial was scheduled to recommence the next day at 10:00
a.m. Plaintiff was again brought into the courtroom in handcuffs.
Facing the prospect of a continued trial, the parties engaged in
lengthy settlement negotiations from approximately 10:00 a.m.
until late afternoon. Plaintiff remained handcuffed and was
restricted to the courtroom during the negotiations. He was
accompanied by his attorney and a friend who was present to help
him. After engaging in daylong settlement negotiations, the
parties reached a global settlement resolving all outstanding
issues.
Later that same day, the trial judge conducted a thorough
hearing to determine whether the parties had entered into the
agreement knowingly and voluntarily, without force or duress, and
were satisfied that the agreement was fair and equitable to both
of them. Prior to having the exact terms of the settlement placed
on the record, the trial judge cautioned the parties to "listen
very carefully" to the terms of the agreement about to be recited,
because once agreed upon, the agreement would be final, and there
would be no renegotiating or changing the agreement. The trial
judge then conducted a thorough voir dire.
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Plaintiff testified that he heard and understood the terms
recited in court, which accurately reflected his understanding of
the agreement. He indicated that the agreement resolved all the
issues between him and his wife. He stated that no one forced or
threatened him to agree to any of the terms, and that he agreed
to the terms voluntarily. He testified that he was satisfied with
the services of his attorney throughout the proceedings. He stated
that he believed the agreement was fair and equitable to both
parties under all the circumstances. He further testified that
given his general economic circumstances, he would not be able to
maintain a lifestyle after the divorce that is similar to what he
enjoyed during the marriage. Nonetheless, he was still willing
to enter into the agreement. Defendant testified similarly, except
for indicating that she would be able to maintain a lifestyle
after the divorce that is similar to what she enjoyed during the
marriage.
Based on their testimony, the trial judge found that: (1) the
parties understood the terms of the agreement; (2) the agreement
was entered into voluntarily, without coercion or duress; (3) the
parties were represented by able and extremely hardworking
counsel, with whom they are both satisfied; (4) the parties were
satisfied that the agreement was fair and equitable to both of
them; and (5) plaintiff had chosen to enter into the agreement
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freely and voluntarily even though he felt that he would not be
able to maintain the marital standard of living after the divorce.
The trial judge granted a dual judgment of divorce and incorporated
the terms of the oral agreement into the final judgment of divorce.
The terms of the settlement were also set forth in a seven-
page handwritten agreement that was prepared and signed by both
parties and their attorneys while in court. Two weeks later,
plaintiff executed a formal typed version of the MSA incorporating
the terms of the July 10, 2012 handwritten agreement with some
additional terms. By that point, plaintiff was no longer under
arrest or incarcerated.
As part of the MSA, plaintiff agreed to pay child support of
$358 per week in accordance with the child support guidelines,
based upon imputed annual income of $162,500 and defendant's W-2
income of $47,000. The agreement further provided that for
purposes of funding secondary education, the minimum income to be
imputed to plaintiff is $150,000.
Plaintiff is the sole owner of a closely held Subchapter S
Corporation, LMN Solutions, Inc. Plaintiff did not retain an
expert to value his business and testify at trial. The equitable
distribution negotiations took into account the valuation of his
business by defendant's expert, Michal H. Karu, CPA/CFF. In his
preliminary report, Karu opined that the "fair value" of
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plaintiff's business was $214,000. Karu did not testify at the
trial because the parties reached a global settlement during
plaintiff's case. Under the terms of the settlement, plaintiff
retained full ownership of his business, free and clear of any
equitable distribution claim of defendant. Plaintiff waited until
2014 to retain an expert to appraise his business. His expert
valued the business at $50,000.
Following their divorce, the parties engaged in extensive
post-judgment motion practice resulting in the following orders
that are pertinent to this appeal: (1) an October 26, 2012 order
denying plaintiff's motion to declare the MSA void, and to
recalculate child support and spousal support; (2) a December 21,
2012 order denying plaintiff's motion for reconsideration of the
October 26, 2012 order; (3) a February 11, 2013 consent order
enforcing certain provisions of the MSA; (4) an April 18, 2013
consent order imposing a qualified domestic relations order (QDRO)
on an investment account, and further ordering "that all other
provisions of the [MSA] shall remain in full force and effect;"
(5) an April 3, 2014 order denying plaintiff's motion to reduce
child support. The December 21, 2012 order stated that plaintiff's
motion for reconsideration was denied because he had "failed to
demonstrate a change of circumstances since the date of signing
the [MSA] sufficient to merit reconsideration."
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Thereafter, in October 2014, more than twenty-six months
after he entered into the MSA, plaintiff moved for fifteen
different forms of relief, including a "reevaluation" of his
"financial situation based on the new forensic accounting report
and, if appropriate, recalculating plaintiff's child support and
alimony obligations." Plaintiff requested a plenary hearing to
address the voluntariness and alleged unconscionablity of the MSA.
Plaintiff contends that he did not enter into the MSA
voluntarily because it was the product of undue pressure and
duress. He claims that the undue pressure and duress resulted
from the following circumstances: (1) the trial judge's negative
attitude and hostility toward him; and (2) being handcuffed during
a portion of the trial and the negotiation of the MSA. Plaintiff
further contends that the MSA is unfair, inequitable, and
unconscionable because his income and the value of his business
were overstated.
After hearing extended oral argument, the motion judge issued
a May 28, 2015 order and five-page statement of reasons denying
the aspects of plaintiff's motion which are the subject of this
appeal without prejudice, including his request for a plenary
hearing.
Plaintiff raises the following arguments on appeal:
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POINT ONE
SCOPE OF REVIEW.
POINT TWO
THE PARTIES' MATRIMONIAL SETTLEMENT AGREEMENT
CANNOT BE ENFORCED AND MUST BE SET ASIDE
BECAUSE THE SAME WAS BOURNE OF DURESS AND/OR
IS UNCONSCIONABLE.
POINT THREE
TRIAL COURT ERRED IN FAILING TO FIND THAT
PLAINTIFF HAD A PRIMA FACIE SHOWING OF CHANGED
CIRCUMSTANCES WARRANTING A REVIEW OF ALIMONY
AND CHILD SUPPORT.
POINT FOUR
THE TRIAL COURT ERRED AS A MATTER OF LAW AND/OR
ABUSED ITS DISCRETION BY DECIDING THIS MATTER
ON THE BASIS OF CONFLICTING FACTUAL
CERTIFICATIONS; RATHER, THE COURT SHOULD HAVE
CONDUCTED A PLENARY HEARING.
We have considered plaintiff's arguments in light of the
record and applicable law, and are not persuaded by any of them.
We affirm substantially for the reasons expressed by Judge
Christopher D. Rafano in his well-reasoned statement of reasons
attached to the May 28, 2015 order. We add the following comments.
"[W]hile settlement is an encouraged mode of resolving cases
generally, 'the use of consensual agreements to resolve marital
controversies' is particularly favored in divorce matters."
Weishaus v. Weishaus, 180 N.J. 131, 143 (2004) (quoting Konzelman
v. Konzelman, 158 N.J. 185, 193 (1999)). Spousal agreements "are
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essentially consensual and voluntary in character and therefore
entitled to considerable weight with respect to their validity and
enforceability notwithstanding the fact that such an agreement has
been incorporated in a judgment of divorce." Petersen v. Petersen,
85 N.J. 638, 642 (1981). "For these reasons, 'fair and definitive
arrangements arrived at by mutual consent should not be
unnecessarily or lightly disturbed.'" Konzelman, supra, 158 N.J.
at 193-94 (quoting Smith v. Smith, 72 N.J. 350, 358 (1977)). "A
settlement agreement will be reformed, however, where a party
demonstrates that the agreement is plagued by 'unconscionablity,
fraud, or overreaching in the negotiations of the settlement.'"
Weishaus, supra, 180 N.J. at 143-44 (quoting Miller v. Miller, 160
N.J. 408, 419 (1999)). Courts have continuing power to oversee
divorce agreements, and the discretion to modify them on a showing
of changed circumstances that render their continued enforcement
unfair, unjust and inequitable. Konzelman, supra, 158 N.J. at 194
(citing Lepis v. Lepis, 83 N.J. 139, 154-55 (1980)).
Plaintiff contends that his child support and spousal support
obligations were based on an overstated imputed income level.
Plaintiff stipulated to an imputed annual income of $162,500 for
child support purposes, and an imputed income of no less than
$150,000 for purposes of calculating responsibility for the cost
of the children's secondary education. Stipulations serve as a
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tool that enables parties to avoid the expense, trouble, and delay
of adducing proofs on facts that, absent a stipulation, are
contestable. Negrotti v. Negrotti, 98 N.J. 428, 432 (1985). As
a general rule, "litigants should be held to their stipulations
and the consequences thereof." Ibid.Furthermore, a movant is entitled to a plenary hearing only
where he clearly demonstrates the existence of a genuine issue of
material fact entitling the party to relief through competent
supporting documents and affidavits. Lepis, supra, 83 N.J. at
159; Eaton v. Grau, 368 N.J. Super. 215, 222 (App. Div. 2004).
Motions to reopen or set aside a judgment are governed by
Rule 4:50-1, which provides:
the court may relieve a party or the party's
legal representative from a final judgment or
order for the following reasons: (a) mistake,
inadvertence, surprise, or excusable neglect;
(b) newly discovered evidence which would
probably alter the judgment or order and which
by due diligence could not have been
discovered in time to move for a new trial
under R. 4:49; (c) fraud (whether heretofore
denominated intrinsic or extrinsic),
misrepresentation, or other misconduct of an
adverse party; (d) the judgment or order is
void; (e) the judgment or order has been
satisfied, released or discharged, or a prior
judgment or order upon which it is based has
been reversed or otherwise vacated, or it is
no longer equitable that the judgment or order
should have prospective application; or (f)
any other reason justifying relief from the
operation of the judgment or order.
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"As a general matter, judgments and orders in family actions are
covered by this rule." Pressler & Verniero, Current N.J. Court
Rules, comment 6.1 on R. 4:50-1 (2017). "Regardless of the basis,
vacation of a judgment under Rule 4:50-1 should be granted
sparingly." In re Guardianship of J.N.H., 172 N.J. 440, 473-74
(2002).
Relief under R. 4:50-1(f) "is available only when truly
exceptional circumstances are present and only when the court is
presented with a reason not included among any of the reasons
subject to the one year limitation." Baumann v. Marinaro, 95 N.J.
380, 395 (1984). "Whether exceptional circumstances exist is
determined on a case-by-case basis according to the specific facts
presented." J.N.H., supra, 172 N.J. at 474. The movant must
demonstrate that continued enforcement of the judgment would be
"unjust, oppressive or inequitable." Quagliato v. Bodner, 115
N.J. Super. 133, 138 (App. Div. 1971). Plaintiff has not met this
burden.
Rule 4:50-1 motions "shall be made within a reasonable time,
and for reasons (a), (b) and (c) of R. 4:50-1 not more than one
year after the judgment, order or proceeding was entered or taken."
R. 4:50-2. In Rogan Equities, Inc. v. Santini, 289 N.J. Super.
95, 112-13 (App. Div.), certif. denied, 145 N.J. 375 (1996), the
defendant sought to attack a final judgment of foreclosure on the
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ground that she had not been properly served. However, the
defendant had actual knowledge of the action but delayed more than
two years before asserting that the judgment and the ensuing
sheriff's sale were void. Ibid. The trial court held that the
defendant's motion to set aside the judgment had not been made
within a reasonable time, as required by R. 4:50-2. Id. at 113.
We affirmed the ruling, holding "in some circumstances a motion
to vacate a void judgment can properly be denied as untimely."
Id. at 114. See also Last v. Audubon Park Assocs., 227 N.J. Super.
602, 607-08 (App. Div. 1988), certif. denied, 114 N.J. 491 (1989)
(rejecting a mortgagee's attempt to void a foreclosure judgment
that had been delayed for two years despite having knowledge of
the judgment).
Plaintiff was aware of the facts and circumstances upon which
he relies in support of his motion at the time they occurred in
2012. He was aware of his treatment by the trial judge, his
arrest, his appearance in court for a portion of the trial and the
negotiation of the MSA while in handcuffs, and his income level.
The financial information and records needed to prove his actual
income level or an appropriate imputed income, and to value his
business, were readily available to him during the pendency of the
divorce. Despite these circumstances, plaintiff offers no
explanation or excuse for filing his motion more than twenty-six
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months after executing the MSA and the entry of the final judgment
of divorce. By any measure, plaintiff did not file his motion
within a reasonable time. Consequently, his application is time-
barred. R. 4:50-2.
We discern no abuse of discretion by Judge Rafano in ruling
on plaintiff's motion without a plenary hearing and in denying the
motion as both time-barred and without merit. See Eaton, supra,368 N.J. Super. at 222 (noting that a "trial judge's decision
whether to allow or deny such relief on one of the six specified
grounds in Rule 4:50-1 should be left undisturbed unless it results
from a clear abuse of discretion"); see also Schwartzman v.
Schwartzman, 248 N.J. Super. 73, 77-78 (App. Div.), certif. denied,
126 N.J. 341 (1991).
The divorce proceeding was fully contested, with extensive
pretrial motion practice and two days of trial before the
settlement was reached. Both parties were represented by
experienced counsel throughout the proceedings. Plaintiff is a
highly educated, sophisticated businessman who owns an information
technology company. He was financially capable of retaining a
forensic accountant while the divorce action was pending. As
noted by Judge Rafano:
He could have hired an expert, provided that
expert with all of the necessary information
to prepare a report, and presented the
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expert's valuation in Court or used the
expert's valuation as a base for negotiations
with the Defendant. Instead, despite having
clear warning that the Defendant intended to
hire an expert, the Plaintiff made a tactical
decision to call his accountant instead. He
cannot now decide that he would like to go
back and litigate his case in a different
fashion because he is unhappy with the
results.
Plaintiff was not ill or under the influence of intoxicants
during the trial or the negotiation of the settlement agreement.
Defendant did not conceal or fraudulently transfer marital assets.
Nor did she fail to disclose her income.
Defendant did not subject plaintiff to duress, coercion or
threats. As further noted by Judge Rafano:
The Defendant had no say in whether a warrant
was issued for Defendant's arrest and no
control over whether he was released. If,
after consulting with counsel, the Plaintiff
had felt he was unable to proceed or felt that
his incarceration was preventing him from
thinking calmly and clearly about the
situation, he could have requested an
adjournment of the trial until he was
released. However, the transcripts do not
indicate that such a request was made. In
fact, both parties agree that the Plaintiff
instead called a friend to come to the court
to help him evaluate the settlement proposals
and that he spent several hours, with the
benefit of the advice of his friend and
counsel negotiating the terms of the Marital
Settlement Agreement.
In addition, several other factors militate strongly against
plaintiff's position. Plaintiff did not seek an adjournment of
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the trial on the day he was arrested or the following day when the
MSA was negotiated and agreed upon. He does not claim that his
counsel was ineffective. He waited more than twenty-six months
to file his motion to set aside the MSA. He offers no explanation
or excuse for the delay. Plaintiff is bound by his imputed income
stipulation. Negrotti, supra, 98 N.J. at 432.
Moreover, both plaintiff and defendant filed post-judgment
motions to enforce various aspects of the MSA during the
intervening two years. As also noted by the motion judge:
The Plaintiff cannot pick and choose which
portions of the Agreement he wishes to follow
and to have the Court hold the Defendant
responsible for, while arguing that his
financial responsibilities should be abated
because his incarceration made it impossible
for him to consent to the Agreement freely.
In addition it is disingenuous for the
Plaintiff to abide by and seek to enforce the
terms of the parties' Marital Settlement
Agreement for the almost two and a half years
since the parties' divorce and then return to
Court seeking to have a portion of the
Agreement vacated because he has decided to
now present evidence that was available to him
at the time of the trial.
"It is well recognized that a litigant who accepts the
benefits of a judgment is estopped from attacking it on appeal."
Tassie v. Tassie, 140 N.J. Super. 517, 524 (App. Div. 1976). The
rule is but a corollary to the established principle that any act
of a litigant "by which he expressly or impliedly recognizes the
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validity of a judgment operates as a waiver or surrender of his
right to appeal therefrom." Id. at 525. Plaintiff benefitted
from various aspects of the MSA incorporated into the final
judgment of divorce during the years following its entry. He
filed motions to enforce the terms of the MSA.
Plaintiff was represented by an experienced attorney in the
negotiation of the settlement agreement as well as advised by an
accountant. He understood the terms of the agreement. There are
no substantiated allegations of fraud, unconscionablity or
overreaching in the negotiations of the MSA. Given the absence
of such circumstances, we agree with the motion judge that there
is no legal or equitable basis to set aside the parties' settlement
agreement. See Miller, supra, 160 N.J. at 419. Judge Rafano
correctly denied plaintiff's motion without conducting a plenary
hearing.
Although we decline to set aside the MSA, we must nonetheless
determine whether plaintiff made a sufficient showing to warrant
a plenary hearing before deciding his application to reduce his
child support obligation based on changed circumstances. Support
provisions contained in settlement agreements or judicial orders
are subject to the same standard of judicial modification based
on substantially changed circumstances. See generally Lepis,
supra, 83 N.J. 147-48; Smith, supra, 72 N.J. at 360.
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An increase in support becomes necessary
whenever changed circumstances substantially
impair the dependent spouse's ability to
maintain the standard of living reflected in
the original decree or agreement. Conversely,
a decrease is called for when circumstances
render all or a portion of support received
unnecessary for maintaining that standard.
[Lepis, supra, 83 N.J. at 152-53.]
Plaintiff contends that he made out a prima facie case for a
reduction in his support obligations. He argues that his motion
should not have been decided based on conflicting affidavits
without a plenary hearing.
Judge Rafano determined that plaintiff failed to make a prima
facie showing of changed circumstances sufficient to warrant a
modification of the support obligations imposed by the MSA. He
further determined that a plenary hearing was not necessary. The
judge explained:
Although the Plaintiff briefly states that
"the IT business is not what it used to be
just a few years ago and many of my former
clients have outsourced their business" he
does not substantiate these claims and seems
to rest the remainder of his certification and
his attorney's legal arguments on the idea
that the Court should reevaluate his financial
circumstances as they existed at the time of
the divorce. Therefore, since he bases his
motion on events that existed at the time of
the parties' divorce, he has not shown a
change in circumstances and therefore has not
sufficiently demonstrated to the Court that a
plenary hearing is necessary to resolve a
dispute of material facts.
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We agree. Plaintiff did not make a prima facie showing of
changed circumstances following the entry of the final judgment
of divorce. A plenary hearing was not required.
The trial judge's and the motion judge's findings are amply
supported by the record. The denial of plaintiff's motion without
conducting a plenary hearing was appropriate.
Affirmed.
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