A.K. VS. D.G. (FM-16-0820-02, PASSAIC 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NOT FOR PUBLICATION WITHOUT THE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-3157-15T4
A.K.,1
Plaintiff-Respondent,
v.
D.G.,
Defendant-Appellant.
______________________________
Argued January 31, 2019 – Decided March 14, 2019
Before Judges Simonelli, O'Connor and DeAlmeida.
On appeal from Superior Court of New Jersey,
Chancery Division, Family Part, Passaic County,
Docket No. FM-16-0820-02.
Michael P. De Marco argued the cause for appellant
(De Marco & De Marco, attorneys; Michael P. De
Marco, of counsel and on the brief).
Douglas J. Kinz argued the cause for respondent.
1
We use initials in order to protect the privacy of the parties.
PER CURIAM
In this post-judgment matrimonial matter, defendant D.G. appeals from
the following Family Part orders: (1) the April 2, 2016 order directing him to
pay $68,928 to plaintiff A.K. as additional child support for the years 2010,
2011, and 2012, and $3,593.75 as reimbursement for extracurricular activities;
(2) the September 25, 2015 order denying his motion for reconsideration; (3) the
February 16, 2016 order awarding plaintiff $15,000 for counsel fees; and (4) the
March 10, 2016 order entering judgment against him in the amount of
$106,133.15.2 We affirm all orders.
I.
The parties were married in August 1993, and have four daughters who
live with plaintiff in Indiana. Their Marital Settlement Agreement (MSA),
incorporated into their April 15, 2002 final judgment of divorce, set defendant's
child support obligation at $2500 per month based on his base salary of $175,000
in 2002, which was above the then maximum amount of $150,800 under the
New Jersey Child Support Guidelines (Guidelines). Plaintiff had no income
other than the $30,000 per year she received in alimony under the MSA.
2
This amount includes $18,611.84 for a cost of living adjustment (COLA) for
the years 2010 and 2012 the court directed defendant to pay under a separate
September 25, 2015 order, from which defendant does not appeal.
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The MSA provided that child support would be recalculated using the
Guidelines if defendant's income exceeded $175,000 for the prior year. In order
to recalculate this amount, the MSA required defendant to provide
documentation of his income for the prior year by August 15 of each year. If
the recalculation revealed that the Guidelines amount exceeded $2500 per
month, defendant had to pay the difference to plaintiff in a lump sum by
September 1. The MSA included an example of how child support would be
recalculated if defendant's income was $250,000.
The child support amount did not include expenses related to the children's
extracurricular activities. Regarding this expense, the MSA provided:
The parties shall be responsible for the costs
related to the extracurricular activities for the Children
in proportion to their relative after tax income . . . from
all sources except child support, as well as any income
that may be imputed by the [c]ourt in accordance with
Miller v. Miller, [160 N.J. 408 (1999)], at any particular
time. As of the execution of this Agreement and until
such time as child support is recalculated, the Husband
shall pay [seventy-five percent] and the Wife shall pay
[twenty-five percent]. This shall include, but not
limited to, ballet lessons, swimming lessons, hobbies,
clubs, school trips and all other expenses associated
therewith. It is agreed that the Wife will obtain the
Husband's consent, which shall not be unreasonably
withheld, prior to enrolling the Children in a particular
activity such as, but not limited, to those listed above.
The Husband shall pay his share of the expenses, to the
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Wife, within seven (7) days of being presented with a
bill, invoice or to her proof of required payment.
Regarding the children's school expenses, the MSA provided:
If the parties agree that the Children should be enrolled
in pre-school and/or private school (elementary through
high school) the parties shall be responsible for all costs
associated therewith, including tuition, books,
uniforms, fees, etc., in proportion to their relative after
tax income, from all sources except child support, as
well as any income that may be imputed by the [c]ourt
in accordance with Miller v. Miller. As of the
execution of this Agreement and until such time as
child support is recalculated, the Husband shall pay
[seventy-five percent] and the Wife shall pay [twenty-
five percent].
The MSA further provided that if either party failed to cure a breach or a
default, that party would be liable for the other party's attorney's fees, "resulting
from or made necessary by the bringing of any suit or other proceeding to secure
such payment or enforce any such obligation, provided" that such suit or other
proceeding resulted in a favorable "[judgment], decree, award or order."
In September 2011, the parties exchanged their 2010 income tax returns
and W-2 forms. These documents showed that defendant's yearly income was
approximately $500,000, triggering a recalculation of defendant's child support
obligation for 2010. The parties could not reach an agreement on the amount of
child support. As a result, plaintiff filed a motion on December 27, 2011,
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seeking a recalculation of defendant's child support obligation, as well as
reimbursement for the children's extracurricular activities and counsel fees and
costs.
In opposition, defendant argued that plaintiff's request for recalculation of
child support was inconsistent with the MSA, and he should not be obligated to
pay anything additional for his daughters' extracurricular activities because he
did not consent to their enrollment in those activities.
Judge John E. Selser held a three-day hearing on non-consecutive days
between March 2014 and October 2014. Prior thereto, the parties exchanged
discovery, including their 2011 and 2012 income tax returns and W-2 forms.
At the hearing, plaintiff testified that she had remarried, had one son with
her current husband, and they lived together in Indiana with her four daughters
from her marriage to defendant. Plaintiff testified as to her economic
circumstances in 2010, 2011, and 2012. She was no longer receiving alimony,
was employed as a kindergarten teacher, and her approximate income was
$35,000 in 2010, $36,000 in 2011, and $37,000 in 2012. Plaintiff also testified
as to her monthly expenses for 2010, which totaled $6102 and included costs for
shelter, transportation, and other personal items.
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Plaintiff testified as to her current economic circumstances, which she
detailed in her March 10, 2014 Case Information Statement (CIS). The CIS
revealed that plaintiff was still employed as a kindergarten teacher at an annual
salary of $38,878, and her net worth had increased to $509,705. Her most
current monthly expenses of $8147 included costs for shelter, transportation,
and other personal items, with $6900 attributed solely to expenses for her four
daughters. Plaintiff explained that the difference in monthly expenses from
2010 to 2014 was due to the tuition for her daughters' private school and her
oldest daughter's auto insurance. In addition, plaintiff's day-to-day expenses
increased because her daughters were now teenagers.
Plaintiff testified that three of her four daughters attended Catholic school.
Plaintiff discussed the matter with defendant prior to the children's enrollment,
but he did not consent. Nonetheless, plaintiff enrolled the children in Catholic
school because she believed it was the best choice for them. Likewise, she
enrolled the parties' other daughter in public school because she believed it was
the best choice for that child.
Plaintiff also testified that during the years 2008, 2009, 2010, and 2011,
there were a number of expenses she incurred for her daughters' extracurricular
activities, including soccer, cheerleading, basketball, volleyball, Confraternity
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of Christian Doctrine classes for all four children, a class trip to Washington,
D.C. for their oldest daughter, and braces for another daughter. Plaintiff notified
defendant of these activities and sent him copies of the bills, requesting payment
of his seventy-five percent share. Defendant paid for some of the expenses, but
objected to paying for the traveling soccer program, the Washington, D.C. trip,
and the braces. Consequently, plaintiff paid one-hundred percent of those
expenses, for which she sought reimbursement from defendant.
Plaintiff also sought reimbursement for "Various Insurance Deductions."
She explained that this amount represented deductions defendant made from his
prior contributions toward extracurricular activities for the premiums he paid
for the children's health insurance. Plaintiff testified that these deductions were
improper because defendant took them after receiving notice that she had
secured other, better health insurance for the children.
Defendant testified that he had remarried and had two daughters with his
current wife. His current wife also had one daughter from a previous marriage
who lived with them in New Jersey.
Defendant testified that he was currently employed by Goldman Sachs in
New York City as Vice President in the internal audit program, and served in
that capacity for the past seven years. His annual base salary was approximately
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$225,000, and he received an average yearly bonus of $135,000 in addition to
his base salary. He also received a number of shares of stock as part of the
bonus. His approximate income was $500,000 in 2010, $440,000 in 2011, and
$320,000 in 2012.
Defendant testified as to his current monthly expenses, which included his
child support obligation, shelter, transportation, and other personal items. His
monthly expenses in 2014 totaled $9965. To cover these costs, he and his
current wife borrowed against credit cards throughout the year and then paid the
balances on those cards when he received his bonus. Defendant also testified
that his net worth was $191,240. Factors effecting that number included the
money defendant and his current wife had borrowed for their home, an in-ground
pool, and vehicles (a 2009 BMW and a 2010 Toyota).
In an April 2, 2015 order and written opinion, Judge Selser directed
defendant to pay plaintiff $68,928 as additional child support for the years 2010,
2011, and 2012, and $3,593.75 as reimbursement for extracurricular activities.
The judge reserved decision on the counsel fee issue and ordered each party to
submit a certification of services.
Defendant filed a motion for reconsideration. Plaintiff filed a cross-
motion to amend the April 2, 2015 order to require defendant to pay a COLA in
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connection with the additional child support, as well as counsel fees and costs
incurred in connection with the motions.
Following a hearing on September 25, 2015, Judge Selser entered an order
denying defendant's motion for reconsideration and a separate order granting
plaintiff's cross-motion to amend the April 2, 2015 order to include a COLA in
the amount of $18,611.84. In a February 16, 2016 order and written opinion,
the judge directed defendant to pay $15,000 for plaintiff's counsel fees. On
March 10, 2016, the judge entered an order for judgment against defendant in
the amount of $106,133.15, which incorporated the amounts awarded to plaintiff
in the prior orders. This appeal followed.
II.
Defendant contends that Judge Selser erred in awarding plaintiff $68,928
as additional child support for the years 2010, 2011, and 2012, and denying his
motion for reconsideration. He argues the judge did not articulate what the
reasonable needs of the children were and failed to consider the standard of
living and economic circumstances of each party as required by N.J.S.A. 2A:34-
23(a)(2).
"Our review of a trial judge's factual findings, following a non-jury trial,
is limited." Elrom v. Elrom, 439 N.J. Super. 424, 433 (App. Div. 2015).
A-3157-15T4
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"Generally, 'findings by the trial court are binding on appeal when supported by
adequate, substantial, credible evidence.'" Ibid. (quoting Cesare v. Cesare, 154
N.J. 394, 411-12 (1998)). In matrimonial matters, this "[d]eference is especially
appropriate 'when the evidence is largely testimonial and involves questions of
credibility.'" Cesare, 154 N.J. at 412 (quoting In re Return of Weapons to
J.W.D., 149 N.J. 108, 117 (1997)). "Reversal is warranted only when a mistake
must have been made because the trial court's factual findings are 'so manifestly
unsupported by or inconsistent with the competent, relevant and reasonably
credible evidence as to offend the interests of justice . . . .'" Elrom, 439 N.J.
Super. at 433 (quoting Rova Farms Resort, Inc. v. Inv'rs Ins. Co. of Am., 65 N.J.
474, 484 (1974)). "Consequently, when a reviewing court concludes there is
satisfactory evidentiary support for the trial court's findings, 'its task is complete
and it should not disturb the result . . . .'" Ibid. (quoting Beck v. Beck, 86 N.J.
480, 496 (1981)). "Deference is appropriately accorded to factfinding; however,
the trial judge's legal conclusions, and the application of those conclusions to
the facts, are subject to our plenary review." Ibid. (quoting Reese v. Weis, 430
N.J. Super. 552, 568 (App. Div. 2013)). "Finally, legal conclusions are always
reviewed de novo." Id. at 433-34 (citing Manalapan Realty, L.P. v. Twp.
Comm. of Manalapan, 140 N.J. 366, 378 (1995)).
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As for the denial of a motion for reconsideration, we have determined,
Reconsideration itself is "a matter within the
sound discretion of the [c]ourt, to be exercised in the
interest of justice[.]" It is not appropriate merely
because a litigant is dissatisfied with a decision of the
court or wishes to reargue a motion, but "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."
[Palombi v. Palombi, 414 N.J. Super. 274, 288 (App.
Div. 2010) (quoting D'Atria v. D'Atria, 242 N.J. Super.
392, 401 (Ch. Div. 1990)).]
We will not disturb a trial judge's denial of a motion for reconsideration
absent a clear abuse of discretion. Pitney Bowes Bank, Inc. v. ABC Caging
Fulfillment, 440 N.J. Super. 378, 382 (App. Div. 2015). "[An] abuse of
discretion only arises on demonstration of 'manifest error or injustice[,]'"
Hisenaj v. Kuehner, 194 N.J. 6, 20 (2008) (quoting State v. Torres, 183 N.J. 554,
572 (2005)), and occurs when the trial judge's "decision is made without a
rational explanation, inexplicably departed from established policies, or rested
on an impermissible basis." Milne v. Goldenberg, 428 N.J. Super. 184, 197
(App. Div. 2012) (quoting Flagg v. Essex Cty. Prosecutor, 171 N.J. 561, 571
(2002)). Applying the above standards, we discern no reason to reverse.
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In his April 2, 2015 written opinion, Judge Selser noted that the parties'
combined income was above the maximum amount under the Guidelines. Thus,
he applied the Guidelines up to the maximum amount and recalculated
defendant's base amount of child support, finding defendant owed $5052 for
2010 ($421 a month), $4680 for 2011 ($390 a month), and $3804 for 2012 ($317
a month), for a total of $13,536. The judge then applied the factors in N.J.S.A.
2A:34-23(a) to supplement the base amount, finding it appropriate considering
defendant's increase in income. The judge recognized that "the needs of the
children are not frozen in time at the time of the divorce, but should reflect the
greater fortune of either or both parent subsequent to the divorce."
Based on plaintiff's testimony and CIS, which Judge Selser found
credible, the judge determined that the needs of the children were $6900 per
month. The judge explained that:
It is always difficult to figure out child support for a
current year, [much] less to go back in time three to five
years . . . . The [CISs] available to the court on behalf
of the plaintiff were from January of 2010 and February
2014. Obviously the years in question fall right in
between those years. This is to say that the children's
needs were greater than the 2010 [CIS] but something
less than what was stated in 2014. In her calculations,
the plaintiff expressed the belief that the needs of the
children, after factoring out of the A B C expenses
herself, were approximately $6,910 a month. The court
accepts this number.
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The court has independently run figures of the
children's needs for the years 2010, 2011, and 2012.
Undoubtedly the expenses varied during those years,
however, this court does believe that an average
expense list for the children for those years would total
$6,900 per month.
The judge found that $6900 reflected a "'typical' financially conservative mid -
west lifestyle" and the children were "not living any sort of an extravagant
lifestyle . . . ."
Judge Selser then described the parties' finances to which they testified,
and noted the very significant disparity in their income. Plaintiff's source of
income was her teaching job, and defendant's source of income was his job as
Vice President of the internal audit program at Goldman Sachs, at which he
earned significantly more income then he did at the time of the divorce. The
judge found both parties had assets and debts that seemed "pretty commensurate
with their incomes and lifestyle[s]."
In determining the child support amount, Judge Selser calculated the
difference between the income available to plaintiff on a monthly basis (her
salary plus child support) and the children's monthly expenses of $6900 for
2010, 2011, and 2012. The judge determined the total unsatisfied amount was
$55,392 ($18,288 for 2010; $18,516 for 2011; and $18,588 for 2012). Thus, the
judge concluded defendant's total additional child support obligation
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(Guidelines-based amount plus supplemental amount) was $68,928 for the years
2010, 2011 and 2012.
The trial court must apply the Guidelines when considering an application
to establish or modify child support. R. 5:6A. However, "[i]f the combined net
income of the parents is more than $187,200 per year, the court shall apply the
guidelines up to $187,200 and supplement the guidelines-based award with a
discretionary amount based on the remaining family income (i.e., income in
excess of $187,200) and the factors specified in N.J.S.A. 2A:34-23." Pressler
& Verniero, Current N.J. Court Rules, Appendix IX-A to R. 5:6A, at paragraph
20(b) (2019). "The key to both the Guidelines and the statutory factors is
flexibility and the best interest of children." Pascale v. Pascale, 140 N.J. 583,
594 (1995). It is well established that "where the parties have the financial
wherewithal to provide for their children, the children are entitled to the benefit
of financial advantages available to them." Isaacson v. Isaacson, 348 N.J. Super.
560, 579 (App. Div. 2002). "Children are entitled to not only bare necessities,
but a supporting parent has the obligation to share with his children the benefit
of his financial achievement." Id. at 580.
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In this regard, a judge is afforded a great deal of discretion, Caplan v.
Caplan, 182 N.J. 250, 264 (2005), but the discretion must be guided by
consideration of the factors specified in N.J.S.A. 2A:34-23(a):
(1) Needs of the child;
(2) Standard of living and economic circumstances of
each parent;
(3) All sources of income and assets of each parent;
(4) Earning ability of each parent, including
educational background, training, employment skills,
work experience, custodial responsibility for children
including the cost of providing child care and the length
of time and cost of each parent to obtain training or
experience for appropriate employment;
(5) Need and capacity of the child for education,
including higher education;
(6) Age and health of the child and each parent;
(7) Income, assets and earning ability of the child;
(8) Responsibility of the parents for the court-ordered
support of others;
(9) Reasonable debts and liabilities of each child and
parent; and
(10) Any other factors the court may deem relevant.
In the context of high-income parents whose ability to pay is not an issue,
"the dominant guideline for consideration is the reasonable needs of the
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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." Isaacson, 348 N.J. Super. at 581. The consideration of children's
needs must include their age and health — with the understanding that infants'
needs are less than those of teenagers — as well as the children's assets or
income. Ibid.Determining a child's "needs" in a high-income earning family presents
"unique problems." Id. at 582. As we have instructed:
First, a balance must be struck between reasonable
needs, which reflect lifestyle opportunities, while at the
same time precluding an inappropriate windfall to the
child or even in some cases infringing on the legitimate
right of either parent to determine the appropriate
lifestyle of a child. This latter consideration involves a
careful balancing of interests reflecting that a child's
entitlement to share in a parent's good fortune does not
deprive either parent of the right to participate in the
development of an appropriate value system for a child.
This is a critical tension that may develop between
competing parents. Ultimately, the needs of a child in
such circumstances also calls to the fore the best
interests of a child.
[Ibid. (citation omitted).]
"Judges must be vigilant in providing for 'needs' consistent with lifestyle
without overindulgence." Id. at 583. Even with high-income parents, the court
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still must "determin[e] needs of a child in a sensible manner consistent with the
best interests of the child." Id. at 584.
Plaintiff testified at length about the reasonable needs of the children,
which were also reflected in her CIS. Regarding her Schedule A (shelter)
expenses, plaintiff testified as to the cost of her home and the cost of maintaining
it on a monthly basis, and indicated the entire family unit, including her current
husband and son, shared the expenses listed. Plaintiff indicated the amount
listed on her Schedule B (transportation) expenses included only her and her
oldest daughter's vehicles. Both vehicles were owned outright, and thus, the
only recurring expenses plaintiff listed were for maintenance and fuel. Although
one of the two vehicles belonged to plaintiff, she testified that she used the
vehicle primarily for the children's benefit — to get back and forth to work as
well as to drive the children to all their extracurricular activities and doctor's
appointments. Plaintiff also indicated the amount listed on her Schedule C
(personal) expenses pertained only to her and her four daughters.
Plaintiff testified that to calculate that exact amount for her Schedule C
expenses, she took her family's monthly expenses and recorded only five-
sevenths of the total, but recorded one-hundred percent of the costs listed for
"school lunches," "private school costs," "orthodontic," and "sports and
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hobbies" for the parties' daughters. Plaintiff admitted that approximately one-
half of the listed medical expenses were attributable to her treatments for breast
cancer. Plaintiff also testified that one-fifth of the remaining expenses,
including food, household supplies, restaurants, and entertain ment, were
attributable to her. She then described in detail what each of those expenses
represented. For example, as regarding the $366 per month restaurant expenses
she listed, plaintiff testified that she and her family dined out "maybe once a
week" at "[an] Applebee's or Friday's, family dining kind of establishment."
Plaintiff also testified that she and her current husband used a Quicken computer
software program to record these expenses, and they categorically recorded
every receipt and cash withdrawal on a daily basis.
Thus, plaintiff testified that her total expenses for her four daughters was
$6900 per month. To cover these monthly expenses, she used the $2500 in child
support, her $2500 in income, and her current husband covered the remaining
amount. Plaintiff also indicated that she and her current husband had taken from
savings to cover these expenses.
Judge Selser found that plaintiff's testimony was "very credible and
indicated . . . that the children [were] not living any sort of an extra vagant
lifestyle in Indiana." The judge found that an average expense listed for the
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children for the years 2010, 2011 and 2012 would total $6900 per month. This
was not a random figure, but an amount the judge found was fair based on
plaintiff's credible testimony and CIS. Thus, contrary to defendant's assertions,
the judge sufficiently articulated what the reasonable needs of the children were.
Defendant argues the judge erred in using the $6900 figure, and $6102
was a more accurate figure. However, as plaintiff testified, $6900 was the
approximate amount she spent per month on the parties' daughters, and the judge
found that testimony credible.
Defendant further argues the judge ignored his testimony that plaintiff
listed $2129 in expenses on her Schedule C for prescription drugs, medical,
medical insurance, private school costs, contributions, life insurance,
savings/investment, and professional expenses that did not pertain to his
children. However, except to express his disagreement with some of plaintiff's
choices, such as sending three of their children to Catholic school, defendant did
not testify as to what should or should not have been included in plaintiff's
monthly expenses. The bulk of his testimony pertained to his income and assets.
Nonetheless, regarding prescription drugs and medical expenses, plaintiff
testified that approximately one-half of the medical expenses were related to her
treatment for breast cancer, and Judge Selser considered that fact when arriving
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at his decision. In addition, plaintiff testified that under the MSA, defendant
was responsible for the children's medical insurance until she became employed,
and she could add the children to her plan if she could secure medical insurance
at a lower rate. Plaintiff indicated that her current husband's medical insurance
was better, low-cost insurance, so after they married, she added the children to
that plan. Plaintiff also explained that she was having difficulty using
defendant's insurance in Indiana. She notified defendant, but he did not cease
insuring the children under his plan. Because of plaintiff's decision, medical
insurance was a monthly expense for her. In response to this, defendant testified
that plaintiff's insurance was not comparable to his insurance, and there were
some unique differences within the policies that still made his insurance more
advantageous.
Judge Selser considered this monthly expense when recalculating the
amount of child support. Although defendant disagrees with the judge, the
judge's decision was based on credible evidence in the record, which defendant
cannot refute.
Plaintiff testified that the children's private school costs were justified
because Catholic school was a better choice for three of her four daughters.
Judge Selser considered those costs as well in his recalculation of child support.
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Although defendant disagreed with plaintiff's decision to enroll his three
daughters in private school, he did not provide any evidence to support his
argument that the children should have attended public school. Consequently,
it cannot be said the judge abused his discretion by including this expense as
part of the children's reasonable needs.
Plaintiff testified that the amount listed on her CIS for "contributions"
represented donations made to their church. Because the children attended
Catholic school and were raised in a Catholic household, these donations
benefitted the children, and thus, it was not improper for the judge to include
this expense as part of the children's reasonable needs.
Regarding the cost for a life insurance premium, plaintiff testified that
although her current husband is the primary beneficiary, her children are
contingent beneficiaries and would benefit from this policy in the event of
plaintiff's untimely death because they currently reside with plaintiff and her
husband in Indiana. The same was true for the amount listed under "savings and
investment."
Finally, plaintiff testified that her "professional expenses" represented the
amount paid to her financial advisor, who helped her and her current husband
manage their money accounts, which benefits the children directly because they
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depend on plaintiff to cover day-to-day expenses and will need plaintiff to help
them pay for college.
Even if there were some incidental benefit to plaintiff from the inclusion
of the above-listed expenses, "the law is not offended if there is some incidental
benefit to the custodial parent from increased child support payments."
Isaacson, 348 N.J. Super. at 584. The law is offended, however, where there is
"overreaching in the name of benefiting a child . . . ." Id. at 585. There is no
evidence to suggest that plaintiff was overreaching in her monthly expenses. As
Judge Selser found, plaintiff's budget reflected a "'typical' financially
conservative mid-west lifestyle." Nothing listed in plaintiff's Schedule A, B, or
C expenses was extravagant. All of plaintiff's expenses were reasonable.
Although she testified she would like to provide her children with more luxuries,
the amount the judge awarded did not provide for that. Instead, the judge
calculated the amount of child support to meet, not exceed, the needs of the
children.
Lastly, defendant argues that Judge Selser erred by failing to consider the
standard of living and economic circumstances of each parent. The judge,
however, did consider those factors. Specifically, the judge noted the amount
of the parties' income and sources of income. He also noted that both parties
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"have assets and debts that seem pretty commensurate with their incomes and
lifestyles" and that "neither party is unreasonably wallowing in debt way above
their means."
Although it is true that plaintiff's net worth is higher than defendant's, the
figures do not truly reflect the parties' economic circumstances. For example, a
substantial portion of plaintiff's current net worth is traced to assets contributed
by her current husband, such as the Ameriprise brokerage account. Also
included in plaintiff's net worth are the children's Section 529 accounts, which
had over $90,000 at the time plaintiff completed her CIS, and which would
ultimately reduce defendant's share of the children's college expenses under the
MSA.
In actuality, defendant's finances were in better shape than he claimed. As
reflected in his CIS, he had approximately $58,000 in cash available in his
checking and savings accounts, whereas plaintiff had $10,200 in cash available.
In addition, defendant's Goldman Sachs 401k plan was worth $212,953, whereas
all of plaintiff's retirement plans totaled approximately $110,000.
Moreover, although plaintiff had less debt than defendant, that was
because she borrowed less than he did. Defendant spent more than plaintiff on
several Schedule C items, including food and household supplies, restaurants,
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and clothing. Defendant also lived in a larger and more expensive home, had an
in-ground pool with custom diving stone, and drove more expensive vehicles.
As Judge Selser succinctly stated, both parties "have assets and debts that seem
pretty commensurate with their incomes and lifestyles."
In sum, Judge Selser based his award of additional child support on all the
evidence presented and clearly did not abuse his discretion in this case. His
decision was fair and amply supported by the record.
III.
Defendant argues that because he did not provide the requisite consent for
his daughters to participate in extracurricular activities, Judge Selser erred in
directing him to reimburse plaintiff for the cost of certain extracurricular
activities. Defendant also argues the judge made no finding that the withholding
of such consent was unreasonable. We disagree with these arguments.
Plaintiff testified that at the time of the divorce, and as memorialized in
the MSA, she and defendant agreed that the children's extracurricular activities
would be a separate cost. Plaintiff was responsible for twenty-five percent of
those expenses and defendant was responsible for seventy-five percent. That
percentage was based on the parties' incomes at the time of the divorce.
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However, if the parties' incomes were to later change, the MSA provided for an
adjustment of the percentages in proportion to their after tax incomes.
Plaintiff claimed that defendant failed to pay his share of extracurricular
expenses, and thus, requested reimbursement in the amount of $3593. Judge
Selser awarded plaintiff this amount, finding the records plaintiff kept of her
expenses were "extensive and quite accurate" and she "ke[pt] very careful track
of her expenditures."
It is readily apparent from Judge Selser's decision that he found
defendant's withholding of consent unreasonable, and the record supports that
finding. Plaintiff testified at length as to the reasons why she enrolled her
daughters in a traveling soccer program, why she allowed her oldest daughter to
go on a class trip to Washington, D.C., and why her youngest daughter needed
braces. The parties specifically contemplated these extracurricular activities in
the MSA, and, as the judge found, they were reasonable. Defendant's objections,
given his high income, were simply not credible. Based on defendant's income,
he had the ability to pay his share of these expenses, and therefore, it was not
unreasonable for Judge Selser to award plaintiff the amount she requested.
Lastly, in a brief one sentence, defendant argues that plaintiff included the
extracurricular activities expenses in her Schedule C expenses. However, there
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is no documentary support for this argument. Rather, the various insurance
deductions ($1,726.90), the amount plaintiff spent on braces ($435.94), and the
amount she spent for the class trip ($478.50) were one-time only expenses, and
based on plaintiff's credible testimony, were not included in her most recent
compilation of monthly expenses.
Regarding the travel soccer and private school expenses, which totaled
$952.41 for the years 2010 and 2011, defendant presented no evidence to suggest
that plaintiff included his portion of these expenses in her Schedule C expenses.
Plaintiff testified that she prepared a compilation of what she believed defendant
owed for his seventy-five percent share of the expenses, and in support of her
position, she presented a list of expenses and receipts. Plaintiff did not say that
these expenses were also included in her monthly budget, and again, defendant
presented no evidence to the contrary. Thus, there is no reason to disturb Judge
Selser's decision on this basis. Moreover, plaintiff only asked that defendant
reimburse her for seventy-five percent of the extracurricular expenses, whereas,
pursuant to the MSA, she was entitled to more in light of defendant's increased
income. For example, in 2010, defendant earned ninety-two percent of the total
family income, yet plaintiff only requested a contribution of seventy-five
percent.
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Judge Selser awarded only what plaintiff requested, nothing more, which
was supported by her testimony as well as her careful documentation. The
record supports his decision.
IV.
Defendant argues that because he did not have a greater ability to pay and
his position was not unreasonable, Judge Selser erred in awarding plaintiff
attorney's fees. We reject this argument.
Plaintiff requested $24,535 in counsel fees. Judge Selser awarded her
$15,000, finding:
[I]t is the opinion of this court that a fee award to
[plaintiff's attorney] of $15,000 would be appropriate.
It is not that plaintiff has no ability to pay her fees. She
has some ability, however, given her income as
opposed to the defendant's income, her income is
certainly less than the full ability to pay fees that the
defendant possesses.
The position taken by the defendant proved to be
a position that did not allow this matter to settle. His
position really brought this matter to the [p]lenary
hearing. It is only fair that he absorb most of the fees.
An award of counsel fees in matrimonial matters rests in the discretion of
the trial court. R. 4:42-9(a)(1); R. 5:3-5(c); Williams v. Williams, 59 N.J. 229,
233 (1971). "Discretion, however, means legal discretion, 'in the exercise of
which the judge must take account of the law applicable to the particular
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circumstances of the case and be governed accordingly.'" Alves v. Rosenberg,
400 N.J. Super. 553, 562-63 (App. Div. 2008) (quoting State v. Steele, 92 N.J.
Super. 498, 507 (App. Div. 1966)).
When reviewing an application for counsel fees, a court must "consider
the factors set forth in the court rule on counsel fees, the financial circumstances
of the parties, and the good or bad faith of either party." N.J.S.A. 2A:34-23. In
a family action, Rule 4:42-9(a)(1) authorizes the award of counsel fees and
refers to Rule 5:3-5(c), which provides that a court should 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 incurred to
enforce existing orders or to compel discovery; and (9)
any other factor bearing on the fairness of an award.
All applications for counsel fees in family actions must also address the
factors set forth in R.P.C. 1.5(a). R. 4:42-9(b). These include the
reasonableness of the fees charged given the task and the skill level of the
attorney. R.P.C. 1.5(a). "In addition, the party requesting the fee award must
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be in financial need and the party paying the fees must have the financial ability
to pay, and if those two factors have been established, the party requesting the
fees must have acted in good faith in the litigation." J.E.V. v. K.V., 426 N.J.
Super. 475, 493 (App. Div. 2012).
Moreover, where one party pursues a position in bad faith, the court may
award reasonable attorney's fees to the other irrespective of the parties' relative
economic health "because the purpose of the award is to protect the innocent
party from unnecessary costs and to punish the guilty party." Yueh v. Yueh,
329 N.J. Super. 447, 461 (App. Div. 2000).
Here, contrary to defendant's argument, plaintiff's finances were not
superior to his finances. As Judge Selser found, defendant's yearly income
during the relevant time-period was substantial. Specifically, defendant had an
annual base salary of approximately $225,000 in addition to an average bonus
of $135,000. Plaintiff, on the other hand, earned approximately $37,000 a year
as a school teacher. Although defendant may have had a "fairly good amount of
debt," he still had better means to afford counsel fees than plaintiff.
Further, we agree with Judge Selser that defendant's position was
unreasonable. Defendant maintained throughout this matter that the MSA
limited the recalculation of child support to the maximum support award under
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the Schedule of Child Support Awards set forth in Appendix IX-F. Defendant
posited that since the MSA required the parties to apply the Guidelines in
recalculating child support, the child support obligation should be limited to the
maximum support amount prescribed for a combined net income of $187,200
per year. Thus, defendant asserted his additional child support obligation for all
three years should be only $7346.
Rule 5:6A provides, in pertinent part:
The guidelines set forth in Appendix IX of these
Rules shall be applied when an application to establish
or modify child support is considered by the court. The
guidelines may be modified or disregarded by the court
only where good cause is shown. . . . In all cases, the
determination of good cause shall be within the sound
discretion of the court.
A completed child support guidelines worksheet
in the form prescribed in Appendix IX of these Rules
shall be filed with any order or judgment that includes
child support that is submitted for the approval of the
court. If a proposed child support award differs from
the award calculated under the child support guidelines,
the worksheet shall state the reason for the deviation
and the amount of the award calculated under the child
support guidelines.
Paragraph 21 of Appendix IX-A provides that "[i]n all cases, the decision
to deviate from the guidelines shall be based on the best interests of the child.
All deviations from the guidelines-based award and the amount of the
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guidelines-based award must be stated in writing in the support order or on the
guidelines worksheet." Paragraph 22 of Appendix IX-A requires:
In accordance with R. 5:6A, if a child support amount
in a stipulated or consent agreement differs from an
award calculated using the support guidelines, the
parties or their representatives shall state on a child
support guidelines worksheet: (a) the amount of support
that would have been awarded if calculated using the
guidelines and (b) the reason that the stipulated amount
differs from the guidelines-based award.
Paragraph 20(b) of Appendix IX-A specifically provides for "extreme
parental income situations" such as those here:
If the combined net income of the parents is more than
$187,200 per year, the court shall apply the guidelines
up to $187,200 and supplement the guidelines-based
award with a discretionary amount based on the
remaining family income (i.e., income in excess of
$187,200) and the factors specified in N.J.S.A. 2A:34-
23. Thus, the maximum guidelines award in Appendix
IX-F represents the minimum award for families with
net incomes of more than $187,200 per year. An award
for a family with net income in excess of $187,200 per
year shall not be less than the amount for a family with
a net income of $187,200 per year. Because estimates
on the marginal cost of children in intact families with
net incomes of more than $187,200 per year are either
unreliable or unavailable, the court shall not extrapolate
the Appendix IX-F schedules (statistically or by adding
amounts from different income ranges) beyond that
dollar limit.
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The MSA does not indicate that the parties intended to restrict the
recalculation of child support to the maximum combined net income under the
Schedule of Child-Support Awards set forth in Appendix IX-F and eliminate
any discretionary-based award if their combined net income exceeded the
maximum set forth in the Schedule. Rather, the MSA indicates the parties
anticipated defendant's income would increase and unequivocally provides that
if his income was "in excess of $175,000 for the prior year, child support shall
be recalculated using the . . . Guidelines." Thus, by agreeing to recalculate
defendant's child support obligation using the Guidelines, the parties bound
themselves to using the Schedule of Child Support Awards up to the maximum
level of their combined income and then applying the factors in N.J.S.A. 2A:34-
23 to determine an additional discretionary amount if their combined net income
exceeded the maximum under the Schedule.
Defendant's position to the contrary was clearly unreasonable. As Judge
Selser noted, it was "pointed out to [defendant] through counsel on several
occasions prior to the [p]lenary hearing that the [Guidelines] provide for a
supplement to child support when the parties combined [income] well exceeded
the maximum amount under the Guidelines." Nonetheless, defendant refused to
settle and forced the matter to proceed to a plenary hearing, which required
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plaintiff to incur travel and legal expenses. Accordingly, we conclude that the
award of attorney's fees in this case was entirely appropriate and not an abuse
of discretion.
Affirmed.
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