ANDRIENNE E. MORRIS VS. ASMAR J. CAPERS (FD-02-0898-17, BERGEN 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NOT FOR PUBLICATION WITHOUT THE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-3181-18T2
ANDRIENNE E. MORRIS,
Plaintiff-Appellant,
v.
ASMAR J. CAPERS,
Defendant-Respondent.
Argued telephonically September 15, 2020 -
Decided September 23, 2020
Before Judges Yannotti and Natali.
On appeal from the Superior Court of New Jersey,
Chancery Division, Family Part, Bergen County,
Docket No. FD-02-0898-17.
Philip Petrullo argued the cause for appellant (Russo
Petrullo Law Group, LLC, attorneys; Philip Petrullo, on
the briefs).
Brian D. Iton argued the cause for respondent.
PER CURIAM
Plaintiff appeals from an order entered by the Family Part on December
28, 2018, which granted defendant's motion for the award of attorney's and
expert's fees. Plaintiff also appeals from an order dated March 8, 2019, which
denied her motion for reconsideration. We affirm in part, reverse in part, and
remand for further proceedings.
I.
We briefly summarize the pertinent facts and procedural history of this
dispute. The parties were involved in an intimate relationship but never married,
and in June 2013, a child was born of the relationship. In March 2017, plaintiff
filed a complaint for custody and child support. Defendant filed a counterclaim
for custody and parenting time. In April 2017, the parties appeared before a
child support hearing officer.
Thereafter, the trial court entered an order dated April 5, 2017, which
designated plaintiff as parent of primary residence and required defendant to pay
child support in the amount of $195 per week. The court also referred the issues
raised in defendant's counterclaim to mediation. Mediation was not successful.
Defendant then issued subpoenas to verify the amount of plaintiff's
income, and plaintiff filed a motion to quash the subpoenas. At the hearing on
the motion, plaintiff represented to the court that her only income from all
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sources was $852.50 per week. The court entered an order dated May 25, 2017,
denying plaintiff's motion to quash the subpoenas based on the court's oral
decision on the record.
In February 2018, defendant filed a motion seeking a downward
modification of child support, sanctions, attorney's fees, increased parenting
time, and other relief. The court entered an order dated May 4, 2018, which
required plaintiff to provide her personal and business tax returns for 2014 to
2017.
Thereafter, the parties exchanged discovery regarding their incomes. In
June 2018, defendant retained an expert to perform a forensic review of
plaintiff's bank statements and tax returns for 2016 and 2017. The court
scheduled the matter for a plenary hearing.
The parties later agreed to the entry of a consent order dated August 31,
2018. Among other things, the order stated that the parties shall continue to
have joint legal custody of the child and plaintiff shall be designated the parent
of primary residence.
The dispute over parenting time was referred to the Bergen Family Center
(BFC), and the parties agreed to the amounts of income that would be imputed
to them for purposes of calculating child support. The order also resolved issues
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regarding the payment of unreimbursed medical expenses, use of the child tax
exemption, and life insurance. The order stated that the parties had not been
able to resolve the issue regarding reimbursement of childcare and
extracurricular expenses, or the issues of attorney's and expert's fees.
Thereafter, defendant filed a motion seeking the award of attorney's and
expert's fees. Plaintiff opposed the motion and filed a motion seeking
reimbursement of childcare and extracurricular expenses and the award of
attorney's fees.
On December 28, 2018, the judge entered an order granting plaintiff's
motion for reimbursement of childcare and denying plaintiff's request for certain
extracurricular expenses. The judge required plaintiff to pay defendant's
attorney's fees of $39,505.19, and defendant's expert fees of $9,375. In the rider
appended to the order, the judge set forth her reasons for her decision regarding
counsel and expert fees.
The judge reviewed the factors for the award of attorney's fees in Rule
5:3-5(c). The judge noted that the analysis performed by defendant's expert
indicated she earned $160,005 in 2006 and $146,664 in 2017, whereas defendant
earned $83,228 in 2006 and $70,918 in 2017. The court found both parties had
not been candid regarding their respective incomes but determined that
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plaintiff's actions substantially outweighed those of defendant. The judge stated
that plaintiff had withheld relevant financial information, which required
defendant to file his motion to reduce child support.
The judge also noted that both parties had claimed they were unable to
pay their own fees or contribute to the fees of the other party. The judge stated,
however, that the ability of a party to pay his or her own fees is not relevant
when a party acts in bad faith. The judge found plaintiff acted in bad faith by
misrepresenting the amount of her income and rejected plaintiff's contention that
her failure to disclose all of her income was due solely to advice she received
from her prior counsel.
The judge noted that the court had not previously awarded fees to either
party and the results obtained were reflected in the consent order entered on
August 31, 2018. In addition, the court found that defendant filed his motion to
recalculate child support based on the parties' actual income. The judge stated
that defendant "was required to retain forensic review and analyze [p]laintiff's
business and personal income to determine [p]laintiff's business income and
expenses."
The judge also found that plaintiff's continued reluctance to disclose her
income accurately "contravened the spirit and policy" of having disputes
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regarding child support resolved in a summary proceeding. The judge stated
that defendant's attorneys had devoted a reasonable amount of time to the
litigation, and the legal services were necessary to expose plaintiff's
misrepresentations. The judge found defendant's attorney's hourly rates were
reasonable, and the fees were incurred to prevent defendant from overpaying
child support, noting that the fee was not contingent and no minimum fee was
charged.
The judge also addressed defendant's request for an award of expert fees,
stating that under the attorney's retainer agreement, defendant was responsible
for the payment of the expert's fees. Furthermore, the expert's agreement set
forth the scope of services and the fee to be charged.
The judge found that, based on the consideration of all of the relevant
facts, plaintiff's motion for an award of attorney's fees would be denied and
defendant's motion for the award of counsel and expert fees would be granted.
The judge further found that plaintiff is capable of paying defendant's attorney's
and expert's fees.
Plaintiff thereafter filed a motion for reconsideration. The judge heard
oral argument and placed her decision on the record stating that plaintiff had not
met the standard for reconsideration. The judge noted that her prior decision
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was not made on a palpably incorrect or irrational basis and she had considered
all relevant, competent evidence. The judge pointed out the disparity between
the income plaintiff initially reported to the hearing officer and the amounts
reflected in plaintiff's business and personal income tax returns. The judge
entered an order dated March 8, 2019, denying the motion for reconsideration.
This appeal followed.
II.
On appeal, plaintiff argues that the trial court erred by awarding defendant
attorney's and expert's fees. She contends the trial court's decision was based
on incorrect reasoning.
Our review of the trial court's award of attorney's fees is limited. Such
determinations should be reversed on appeal "only on the rarest occasions, and
then only because of a clear abuse of discretion." Rendine v. Pantzer, 141 N.J.
292, 317 (1995). "A trial court decision will constitute an abuse of discre tion
where the decision [was] made without a rational explanation, inexplicably
departed from established policies, or rested on an impermissible basis." Saffos
v. Avaya, Inc., 419 N.J. Super. 244, 271 (App. Div. 2011) (alteration in original)
(citations omitted).
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N.J.S.A. 2A:34-23 provides that a Family Part judge may award counsel
fees in a matrimonial case where the circumstances of the case render them
reasonable and just. The court conducts its analysis using the factors set forth
by Rule 5:3-5(c). The rule states that the court should consider:
(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.
[R. 5:3-5(c).]
Plaintiff argues that the Family Part judge erred by basing the award
primarily on her failure to disclose all of her income. The record shows that in
March 2017, when plaintiff filed her complaint for custody and child support,
she reported she earned gross weekly income of $852.50. In April 2017, at the
child support hearing, plaintiff again testified that her sole income in 2017 was
$852.50 per week.
Moreover, in support of her motion to quash defendant's subpoenas for
her financial records, plaintiff stated in a certification that she had reported her
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income for child support purposes at $874 per week, based on the paystub she
had provided. She also stated she had been "completely truthful" about her
income.
In May 2018, after defendant filed his motion seeking, among other relief,
a reduction in child support, plaintiff asserted that she had not misrepresented
the amount of her income. Furthermore, in a certification submitted to the trial
court in August 2018, plaintiff stated that her only income was the income
reported on her W-2 form. She asserted that as of March 2017, she had no
independent contracting work or consulting income to report.
The business bank statements that defendant obtained in discovery
showed, however, that in 2016, plaintiff earned about $160,000 in income from
her consulting business. The statements also showed that in 2017, plaintiff
earned about $146,000 in such income. Plaintiff later agreed to the entry of the
consent order, which provided that for purposes of calculating child support, her
annual income was $127,000.
Plaintiff maintains, however, that in March 2017, when she filed her initial
application for custody and child support, she was not represented by counsel.
She asserts that although the financial statement she submitted at that time only
referred to her salary of $852.50 per week, she provided her 2014 tax return
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which disclosed that she had about $53,000 of income from her consulting
business. Plaintiff claims her only income in March 2018 was the income
reported on her W-2 tax form. She asserts that she had been forthright in
disclosing her income.
The record shows that plaintiff did not retain counsel until defendant
served his subpoenas seeking disclosure of her financial records. She claims her
attorney at that time did not advise her that the rules of court require full and
complete disclosure of all relevant facts and evidence that may lead to the
discovery of relevant information. Plaintiff contends her former attorney did
not advise her that the income from her consulting business was relevant or that
she needed to disclose that income.
We are convinced, however, that there is sufficient credible evidence in
the record to support the judge's finding that while both parties had not been
entirely forthright in disclosing their respective incomes, plaintiff's
misrepresentations substantially outweighed defendant's actions. The record
supports the judge's finding that because plaintiff failed to disclose all of her
income, defendant sought discovery, filed his motion to reduce child support,
and retained a forensic expert to analyze plaintiff's business and personal
income.
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The judge noted that plaintiff had attempted to shift responsibility to her
former attorney for her failure to fully disclose her income, but plaintiff failed
to disclose her business income in her initial filing while she was self-
represented. Although plaintiff submitted a tax return from 2014 that reported
some business income, she repeatedly asserted that her only income in 2017 was
the income reported on her paystubs and W-2 form. The record shows that
plaintiff's statements regarding her income were not accurate.
Thus, there is sufficient credible evidence in the record for the trial court's
finding that plaintiff knew she was required to disclose all of her income and
acted in bad faith by failing to do so. The court did not err by relying on this
finding as support for the decision to award defendant counsel and expert fees.
III.
Plaintiff further argues that the trial court erred by requiring her to pay all
of defendant's counsel fees and the fees for the forensic expert. She contends
the trial court awarded attorney's fees for the pursuit of issues upon which she
prevailed and on issues the parties amicably resolved. She further argues that
the amount of attorney's fees incurred was disproportionate to the limited
reduction in child support that defendant obtained by consent.
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Here, the trial court did not mistakenly exercise its discretion by awarding
defendant attorney's fees for the time defendant's attorney reasonably devoted
to the dispute regarding child support. As noted, in April 2017, when plaintiff
filed her motion for custody and child support, she claimed her only income was
$852.50 per week, or about $44,330 per year.
Defendant thereafter sought discovery concerning plaintiff's income and
sought a reduction in child support. In discovery, defendant obtained records
that showed plaintiff had not disclosed all of her income. He also retained an
expert, who opined that plaintiff's adjusted gross income for 2017 was $145,664,
which included ordinary business income of $134,824.
Plaintiff later stipulated that for purposes of calculating child support, her
income was $127,000 per year. This was substantially higher than the amount
of income she initially reported in March 2017. The judge found that the
resulting modification in child support would save defendant from overpaying
between $81,798 to $113,508, depending upon the results of the parenting time
evaluation. The record supports that finding.
We are convinced, however, that the court erred by awarding all the
attorney's fees defendant incurred in the litigation. The dispute concerning the
amount of child support was not the only matter in dispute. As stated previously,
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before the scheduled plenary hearing, the parties resolved many issues and their
agreement was reflected in the consent order dated August 31, 2018.
Here, the trial court erred by failing to determine the amount of attorney's
fees defendant incurred for issues on which he prevailed and on those issues on
which plaintiff prevailed. When making an award of attorney's fees, the court
may exclude time "spent litigating claims on which the party did not succeed
and that were distinct in all respects from claims on which the party did
succeed." Rendine, 141 N.J. at 335 (quoting Rode v. Dellarciprete, 892 F.2d
1177, 1183 (3d Cir. 1990)).
Although defendant obtained a favorable result on his motion for a
reduction in child support, plaintiff prevailed on her claim regarding work-
related childcare expenses. She did not, however, prevail on her claim for
reimbursement of extracurricular expenses. Moreover, the court did not
consider whether plaintiff or defendant prevailed on the issues resolved by
settlement. As to those issues, the court should have considered whether either
party achieved "some of the benefit" he or she sought in the litigation. R.M. v.
Supreme Court of N.J., 190 N.J. 1, 10 (2007) (quoting Hensley v. Eckerhart, 461
U.S. 424, 433 (1983)).
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We therefore reverse the award of fees in the amount of $39,505.19 and
remand the matter to the trial court for reconsideration of the amount of the fees
to be awarded. The award should be limited to attorney's fees for litigating
issues on which defendant prevailed.
We also conclude the trial court did not err by awarding defendant the fees
charged by the forensic accountant. The judge found that defendant "was
required to retain forensic expert review" to analyze plaintiff's financial records
and determine the amount of plaintiff's "business income and expenses." There
is sufficient credible evidence in the record to support the court's finding that
plaintiff should bear this expense.
On appeal, plaintiff further argues that the award of counsel and expert
fees is contrary to public policy, which favors settlement of disputes; the award
is inconsistent with the applicable court rules; the court failed to make
appropriate findings of fact and conclusions of law; and the court erred by
denying her motion for reconsideration. In view of our decision remanding the
matter to the trial court for further review of the amount of attorney's fees to be
awarded, we need not address these arguments.
Affirmed in part, reversed in part, remanded to the trial court for further
proceedings in accordance with this opinion. We do not retain jurisdiction.
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