PATRICIA WENZ VS. DEAN WENZ (FM-13-0831-16, MONMOUTH 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NOT FOR PUBLICATION WITHOUT THE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-1703-17T2
PATRICIA WENZ,
Plaintiff-Appellant,
v.
DEAN WENZ,
Defendant-Respondent.
_________________________
Argued October 24, 2018 – Decided November 8, 2019
Before Judges Nugent and Mawla.
On appeal from the Superior Court of New Jersey,
Chancery Division, Family Part, Monmouth County,
Docket No. FM-13-0831-16.
Charles F. Shaw, III argued the cause for appellant
(Pandolfe, Shaw & Rubino, LLC, attorneys; Jeff
Thakker, of counsel; Charles F. Shaw, III, on the brief).
Thomas W. Madden argued the cause for respondent.
The opinion of the court was delivered by
NUGENT, J.A.D.
This appeal involves a post-judgment motion in a Family Part action.
Plaintiff, Patricia Wenz, appeals from an order that denied her motion to open
discovery and modify the parties' Matrimonial Settlement Agreement (MSA).
She also appeals the award of counsel fees to defendant, her ex-husband, Dean
Wenz. Plaintiff contends defendant fraudulently withheld information about his
pension benefits. She asserts the trial court erred by finding to the contrary
without giving her the opportunity to take discovery to prove the fraud.
The parties acknowledged in the MSA that discovery was incomplete,
there was an inherent risk in waiving further discovery, but despite this risk they
had instructed their attorneys to memorialize their agreement to settle their
outstanding issues. The MSA stated that information about the disability portion
of defendant's pension was currently unknown, but plaintiff nonetheless agreed
to accept a specified monthly payment for the share of defendant's pension she
would have received in equitable distribution.
Because plaintiff's claims of fraud are speculative, and because the trial
court did not abuse its discretion by denying post-judgment discovery, we affirm
the order denying plaintiff's motion to modify the MSA. We vacate the award
of counsel fees, however, because the trial court did not consider the parties'
ability to pay and did not otherwise explain, adequately, the basis of its award.
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I.
The parties presented these facts to the Family Part judge who denied
plaintiff's motion. The parties divorced after thirty-nine years of marriage.
When they divorced, their only child was emancipated. Plaintiff filed the
divorce complaint in November 2015. The court entered the Judgment of
Divorce (JOD) nine months later, in August 2016. The MSA the parties had
signed was attached to the JOD.
The MSA included the following paragraphs relevant to this appeal.
1. Incomplete Discovery. Both parties
acknowledge that discovery is incomplete. However,
both husband and wife are fully familiar with the issues
in dispute, as well as the assets and liabilities the[y]
attributed to the marriage. The parties acknowledge
that despite the incomplete discovery, they have
instructed their attorneys to memorialize their
agreement into this writing. Both parties have been
advised of their right to seek further discovery and
continue the divorce process. Both parties
acknowledge their formal waiver to seek any further
discovery and their willingness to enter into this
Agreement, despite the inherent risk of waiving further
discovery.
2. In signing this Agreement, the parties release his
or her attorney from any liability or responsibility
associated with this Agreement, for any reason, as
neither attorney has had an opportunity to review
completed discovery and that the discovery provided by
the parties is limited. The parties recognize that their
respective attorney only agreed to create this
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Agreement based upon the parties assurance that these
terms were fully acceptable to each party and that there
was no need to seek further discovery or expend time
or resources pursuing any further discovery. The
parties acknowledge that neither attorney has provided
any tax advice, nor does either attorney have any
expertise in such matters and that the parties have been
instructed to seek such advice from a qualified
professional if needed.
....
9. Equitable Distribution/Alimony Payment. The
parties acknowledge that the husband has a Post Office
Pension and a Department of Corrections Pension that
are both in pay status. The parties acknowledge that a
portion of the Dept. of Corrections pension is related to
the husband's disability, although the portion is
unknown. Despite the lack of complete discovery or
information, the wife agrees to accept a monthly
payment of [$1400] for her share of the husband's
pensions that she would have received in equitable
distribution. These payments shall be considered
support in the event the husband attempts [to] discharge
this obligation through bankruptcy. The parties
acknowledge that these payments may be subject to tax
or eligible for tax deduction as alimony.
....
12. The parties acknowledge their waiver to further
discovery, their right to a trial and are fully satisfied
with their entry into this Agreement. The parties
acknowledge that they are each of sound mind and not
under the influence of any substance that might alter or
inhibit their ability to fully understand this proceeding
or the magnitude of all of the provisions of this
Agreement. They further acknowledge that although
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this agreement was written in haste, at the Courthouse,
on the day of their divorce, they have each had
sufficient time to review it and that they each
understand it and intend to fully comply with all of its
terms and provisions.
Eight months after the divorce, plaintiff filed a motion seeking, among
other relief, an increase in support and equitable distribution, one-half of an
alleged award to defendant of back pay, and a period of discovery "to bring
about full financial transparency." Plaintiff filed the motion because she had
learned defendant had received a $250,000 lump sum pension payment from the
New York State and Local Retirement System (N.Y. Retirement System).
Although the motion was unopposed, the trial court denied it.
In its written decision, the court noted that a party seeking a modification
of alimony has the burden of demonstrating a change in circumstances
warranting relief from the support or maintenance obligations. The court also
noted the party seeking such a modification must make a prima facie showing
of changed circumstances to justify a plenary hearing. Finding "the parties
addressed in their MSA the very issue [p]laintiff is raising"; finding the parties
had waived discovery despite unknowns about defendant's pension; and finding
"no indication [p]laintiff entered this agreement under fraud, duress, or
coercion"; the court denied plaintiff's unopposed motion.
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Several months later, defendant filed a motion for an order finding
plaintiff in violation of litigant's rights. Defendant certified that contrary t o a
MSA provision that required the parties to fully cooperate with defendant's
efforts to modify the mortgage on the former marital home, plaintiff had
withdrawn her authorization for defendant's loan modification attorney to deal
directly with the lender. Defendant's loan modification attorney certified
plaintiff had contacted him and told him, among other things, she was angry
about the outcome of her previous motion and the order that denied the relief
she had requested. Plaintiff filed but withdrew a cross-motion seeking the same
relief she had requested in her previous motion to modify the MSA.
The Family Part judge who heard the motion granted defendant the relief
he had requested concerning his efforts to modify the mortgage. In addition,
finding "[p]laintiff's good faith is questionable," the judge awarded defendant
some of the counsel fees he had incurred.
The judge entered the order granting defendant's motion on September 22,
2017. Three days earlier, on September 19, plaintiff had filed another motion
to modify the MSA. The same judge denied the motion and granted defendant's
cross-motion for counsel fees. Plaintiff filed this appeal from the memorializing
order.
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In support of her second motion seeking modification of the MSA and a
period of discovery to obtain relevant documents from the N.Y. Retirement
System, plaintiff alleged fraud rather than changed circumstances. She filed a
certification in which she acknowledged that at the time of her divorce from
defendant she knew he was receiving monthly pension payments from the N.Y.
Retirement System and the United States Postal Service, as well as social
security. She noted that in his case information statement (CIS), defendant
represented he had no other pensions. He repeated those representations in a
memorandum he had submitted to a settlement panel. Plaintiff asserted she
relied on this information when she made the decision to forego additional
discovery and sign the MSA.
Plaintiff certified defendant had received a lump sum payment of
$251,276.09, which was reflected on one of his bank account statements as well
as a retirement account statement. Plaintiff did not explain how she had come
into possession of defendant's bank statement and retirement account statement.
She merely stated, "I received both of these documents in 2017. Needless to say
they were not given to me by the [d]efendant." Plaintiff asserted she was entitled
to "half of that money in equitable distribution."
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Plaintiff also certified she had attempted to obtain relevant documentation
from the N.Y. Retirement System, but was unable to do so without authorization
from defendant. She suggested that discovery of the information would likely
reveal defendant "knew probably more than the year before the [JOD] that he
was receiving this lump sum from the State."
Defendant filed a cross-motion seeking, among other relief, sanctions for
plaintiff's bad faith, an order compelling plaintiff to disclose under oath how she
obtained the statements, which had been mailed to him, and counsel fees and
costs. He argued that plaintiff was attempting to "skirt" her failure to move for
reconsideration or appeal from the court's May 2017 order. He alleged plaintiff
had stolen his bank statements and mail. He also alleged the issues were fully
accounted for in the MSA and previously addressed in the court's May 2017
order.
Concerning the lump sum distribution, defendant averred:
I did receive pension/disability monies in a lump sum,
but it was all known at the time of our divorce. We had
extensive discussions about the unknown quantity of
what I might receive in the future, the fact that the
disability portion would not be subject to equitable
distribution, and [plaintiff] essentially waived any right
to any distribution or receipt of additional pension
monies . . . .
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In further support of his cross-motion, defendant included the certification
of the attorney he retained to seek a loan modification on the former marital
home. The attorney certified that after plaintiff withdrew her authorization for
him to speak directly to the lender, she telephoned him. During the
conversation, "[s]he specifically stated that she was angry at [defendant] for
receiving a job-related injury settlement and not giving her any of the money,
despite the fact that the [MSA] did not call for her receiving any of that money."
According to the attorney's certification, plaintiff made the statements "[o]n or
about August 15 th, 2017."
In a reply certification, plaintiff explained that one day while in the marital
home, she saw defendant's bank statement and annual pension statement opened
on the bed, so she photographed them with her cellular phone.
The Family Part judge denied plaintiff's motion. The judge noted
plaintiff's "request to reopen the terms of the MSA has previously been
addressed." The court cited language in the previous order confirming the court
"did not find [d]efendant's lump sum pension payment to be a change in
circumstances warranting a modification of the [p]laintiff's alimony or equitable
distribution." The judge also noted the finding in the previous order that
"[p]laintiff's newly discovered information regarding the [d]efendant's financial
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circumstances, namely his failure to mention a lump sum from his pension
payment plan, was addressed in terms of the MSA and was, therefore, not a
change in circumstances."
The court also determined plaintiff waived her right to further discovery
"multiple times in the MSA." The judge noted the MSA went to great length to
document the parties' knowledge that they were waiving further discovery and
protecting their attorneys from liability. The judge also noted plaintiff's
argument—defendant had failed to mention the lump sum payment—was
refuted by the MSA's reference to the disability claim. Concluding plaintiff had
failed to support her allegation that defendant committed fraud, the judge denied
the motion to modify the MSA, compel documentation concerning defendant's
pension, and compel defendant's New York counsel to turn over his file
concerning defendant's disability payments.
The judge also exercised her discretion to deny post-judgment discovery.
Concerning sanctions, the court awarded defendant some of the attorney's fees
he had requested. Citing the authority for awarding attorney's fees found in Rule
4:42-9(a)(1), (fee allowance in family actions), N.J.S.A. 2A:34-23 (authorizing
the court to award fees), and Rule 5:3-5 (authorizing the award of attorneys' fees
in certain family actions), the court found defendant had satisfied the
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requirements of the rules and statute. The court cited in its decision the factors
enumerated in Rule 5:3-5(c) a court should consider when awarding fees. In
addition, it cited case law requiring that a court presented with a fee application
consider such factors as financial need, ability to pay, good or bad faith of a
party, the nature and services rendered, and the reasonableness of the fees. Mani
v. Mani, 183 N.J. 70, 94 (2005).
The court noted that both attorneys had submitted certifications that were
compliant with the relevant rules and that the fees were reasonable. However,
the court decided that [a]fter review of the [Rule] 5:3-5(c) factors and the
Certification of Services," it should grant fees to defendant for all costs and fees
associated with the filing. Although neither party had submitted a current CIS,
the court found defendant had acted in good faith but plaintiff's good faith was
questionable, particularly considering she had filed multiple motions for the
same relief, some after her original motion was denied in May 2017. Moreover,
defendant had been "mostly successful in his request for relief," and plaintiff
had been "unsuccessful in her request for relief." The court concluded: "In total,
the factors indicate that the [c]ourt should award [d]efendant counsel fees for
this [m]otion." The court awarded defendant fees and costs of $3050.
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II.
On appeal, plaintiff argues the Family Part judge erred by failing to
modify the MSA based on defendant's failure to disclose on his pre-divorce CIS,
the memorandum he submitted to a settlement panel, or the MSA, the lump sum
payment he expected to receive. Plaintiff argues that, alternatively, the Family
Part judge should have permitted discovery concerning the lump sum payment.
Last, plaintiff argues the Family Part judge abused her discretion when she
awarded defendant counsel fees.
Defendant insists the Family Part judge did not abuse her discretion.
Rather, she properly found the MSA fully accounted for the pension issue
plaintiff now raises, and plaintiff waived discovery concerning the issue.
Defendant also contends the issue plaintiff now raises was previously decided
and she did not appeal from the memorializing order.
III.
We begin with some fundamental principles that inform our review of the
trial court's decision. "New Jersey has long espoused a policy favoring the use
of consensual agreements to resolve marital controversies." Konzelman v.
Konzelman, 158 N.J. 185, 193 (1999). That is so because "[v]oluntary
agreements that address and reconcile conflicting interests of divorcing parties
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support our 'strong public policy favoring stability of arrangements' in
matrimonial matters." Ibid. (quoting Smith v. Smith, 72 N.J. 350, 360 (1977)).
Thus, "fair and definitive arrangements arrived at by mutual consent should not
be unnecessarily or lightly disturbed." Id. at 193-94 (quoting Smith, 72 N.J. at
358).
Nonetheless, "'the law grants particular leniency to agreements made in
the domestic arena,' thus allowing 'judges greater discretion when interpreting
such agreements.'" Pacifico v. Pacifico, 190 N.J. 258, 266 (2007) (quoting
Guglielmo v. Guglielmo, 253 N.J. Super. 531, 542 (App. Div. 1992)).
This leniency is derived from the terms of the marital
agreement and the nature of some post-judgment issues,
such as custody of children and financial support for the
family, that may require modification of the marital
agreement over the years as events occur that were
never contemplated by the parties. Nevertheless, the
court must discern and implement the common
intention of the parties[,] . . . and enforce [the mutual
agreement] as written[.]
[Quinn v. Quinn, 225 N.J. 34, 46 (2016) (citations
omitted.]
In cases where equitable reasons for applying "normal tenets of contract
interpretation" do not exist, the Supreme Court has recognized that "[a] narrow
exception to the general rule of enforcing settlement agreements as the parties
intended is the need to reform a settlement agreement due to 'unconscionability,
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fraud, or overreaching in the negotiations of the settlement[.]'" Id. at 46, 47
(quoting Miller v. Miller, 160 N.J. 408, 419 (1999)). Thus, "while spousal
agreements are presumed valid, any agreement may be set aside 'when it is the
product of fraud or overreaching by a party with power to take advantage of a
confidential relationship.'" Guglielmo, 253 N.J. Super. at 541 (internal citation
omitted).
A motion to modify the equitable distribution provisions in a property
settlement agreement may be brought under Rule 4:50-1 entitled "Relief from
Judgment or Order." See Connor v. Connor, 254 N.J. Super. 591, 601 (App.
Div. 1992). The standard under Rule 4:50-1(f) "is quite different from the
changed circumstances standard of Lepis v. Lepis, 83 N.J. 139, 145-49 (1980)
which only applies to the modification of support." Ibid. (citing Schwartzman
v. Schwartzman, 248 N.J. Super. 73, 77 (App. Div. 1991)). Rather, relief from
a negotiated equitable distribution scheme "is not available absent exceptional
and . . . compelling circumstances." Ibid. Because "[a] motion under Rule 4:50-
1 is addressed to the sound discretion of the trial court," the court's decision to
grant or deny the motion "will be left undisturbed unless it represents a clear
abuse of discretion." Hous. Auth. of Morristown v. Little, 135 N.J. 274, 283
(1994).
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Here, plaintiff has failed to demonstrate such exceptional and compelling
circumstances as to persuade us the trial court abused its broad discretion by
denying her motion. In her previous motion, she alleged defendant's pension
payments had increased, which had resulted in the lump sum payment, and she
was thus entitled to, among other relief, an increase in alimony. The court
rejected that argument, so she now asserts defendant fraudulently withheld
information about his pension. Her allegations of fraud, however, are
speculative.
The MSA states expressly:
The parties acknowledge that a portion of the Dept. of
Corrections pension is related to the husband's
disability, although the portion is unknown. Despite
the lack of complete discovery or information, the wife
agrees to accept a monthly payment of [$1400] for her
share of the husband's pensions that she would have
received in equitable distribution.
Plaintiff does not claim that, put on notice that defendant would be
receiving a portion of his pension related to a disability, she made any inquiry
about the nature of the disability itself: its inception, its duration, or the method
by which the amount of disability would be computed. Rather than pursuing
available discovery to determine these issues, and for reasons not entirely clear
from the record, plaintiff chose to forego discovery, finalize the divorce, and
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accept monthly payments of $1400 for the share of defendant's pension she
would have received in equitable distribution.
Plaintiff's argument that she relied on defendant's CIS and a memorandum
he submitted to a settlement panel is unavailing. Plaintiff produced no evidence
that defendant knew anything more at the time he prepared those documents than
when he signed the MSA.
Plaintiff argues that the time between defendant's execution of the MSA
and his receipt of the lump sum payment is evidence defendant knew before
signing the MSA the amount he would receive. In her challenge to the court's
denial of her application, however, she implicitly concedes that only after seeing
defendant's pension documents will she know when he knew about the lump sum
and whether he committed fraud. Absent any other information concerning the
nature of the payment, whether it resulted from a disputed proceeding, resulted
from an increase in benefits as plaintiff once alleged, or how the lump sum was
computed and agreed upon, plaintiff's allegations are merely speculative.
We thus turn to plaintiff's contention the court erred by not permitting her
to take discovery concerning the lump sum pension payment to defendant. The
discretion to grant or deny post-judgment discovery in family matters rests
within the sound discretion of the trial court. Welch v. Welch, 401 N.J. Super.
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438, 446 (App. Div. 2008). The parties seeking discovery are required to make
a preliminary showing concerning its necessity. To permit unfettered post -
judgment discovery would convert motion practice into unwieldy mini -trials
resulting in lengthy delays, a situation Rule 5:5-4 was specifically adopted to
avoid. Ibid.
Here, we find no abuse of discretion on the trial court's part, particularly
because of the clear, unequivocal, repeated representations by plaintiff in the
MSA that she was knowingly and voluntarily waiving any right to additional
discovery.
IV.
We turn to plaintiff's challenge to the trial court's award of fees to
defendant. Rule 4:42-9 authorizes a court to award fees in family actions
pursuant to Rule 5:3-5(c). Rule 5:3-5(c) requires a judge to consider 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
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incurred to enforce existing orders or to compel discovery; and (9) any other
factor bearing on the fairness of an award. Thus, in evaluating a fee application,
a court must consider whether the party requesting the fees is in financial need;
whether the party against whom the fees are sought has the ability to pay; the
good or bad faith of either party in pursuing or defending the action; the nature
and extent of the services rendered; and the reasonableness of the fees. Mani,
183 N.J. at 94-95.
The court in Kelly v. Kelly, 262 N.J. Super. 303 (Ch. Div. 1992),
explained the circumstances warranting the imposition of fee shifting in
matrimonial matters when bad faith is demonstrated:
Fees in family actions are normally awarded to permit
parties with unequal financial positions to litigate (in
good faith) on an equal footing. Anzalone v. Anzalone
Bros.[,] Inc. and Anzalone, 185 N.J. Super. 481, 486-
[8]7 (App. Div. 1982). With the addition of bad faith
as a consideration, it is also apparent that fees may be
used to prevent a maliciously motivated party from
inflicting economic damage on an opposing party by
forcing expenditures for counsel fees. This purpose has
a dual character since it sanctions a maliciously
motivated position and indemnifies the "innocent"
party from economic harm. Fagas v. Scott, [251 N.J.
Super. 169, 194, 197-200 (Law Div. 1991).]
[Id. at 307.]
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Here, in awarding fees, the court acknowledged it was "not in a position
to make any assumptions regarding [the parties'] financial circumstances." The
court noted plaintiff's good faith was questionable. Finally, the court noted
defendant's relative success in requesting relief, in contrast to plaintiff, who had
been relatively unsuccessful in requesting relief. The court's analysis was
inadequate to make an award of fees to defendant.
The court was aware from the record that defendant had received a lump
sum payment of $250,000. Moreover, the court was aware from the MSA that
plaintiff had received virtually nothing in equitable distribution other than a
future payment to transfer her interest in the marital home to defendant and the
$1400 monthly payment she would receive from defendant's pension payments.
Those factors suggest a disparity in financial positions that in and of itself was
a basis for either denying counsel fees or requiring the parties to submit
additional financial information.
Moreover, unlike plaintiff's conduct when she attempted to thwart
defendant's refinancing the marital home, there was no evidence plaintiff filed
her motion in bad faith. It is not insignificant that defendant could have easily
resolved questions about the nature of his lump sum payment by producing
relevant documents. He produced no such documents in response to either of
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plaintiff's motions. Thus, though the trial court exercised its discretion in
denying plaintiff post-judgment discovery, that does not resolve the question of
whether plaintiff pursued such discovery in good or bad faith.
For the foregoing reasons, we vacate that portion of the court's order
awarding attorney's fees to defendant. We do so without prejudice to defendant
to refile the application, supported by documentation relevant to his financial
condition and the parties' good or bad faith, including the nature of the lump
sum payment he received, how it came about, and when he first applied for it.
If plaintiff opposes the motion based on ability to pay, she must also file current
financial information. Upon receipt of the required information from both
parties, the court should be in a position to make an accurate determination about
whether defendant is in financial need, whether plaintiff has the ability to pay,
and whether plaintiff acted in good or bad faith in pursuing her motion. Mani,
183 N.J. at 94-95.
Affirmed in part and vacated in part. We do not retain jurisdiction.
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