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E.S.—Plaintiff v. L.R.S.—Defendant, 350249/07

Supreme Court, New York County, Part 31

Family Law

Decided: August 11, 2010

TRIAL DECISION AND ORDER

The issues in this divorce action are equitable distribution of the marital assets and liabilities; maintenance and various issues arising from the pendente lite support orders; and attorney and expert fees. A trial was conducted on October 6, 7, 8, 9, 14, 15, 16, 20, 21, 22, 23, 28 and 30, 2009. It was agreed by the parties that the issue of attorney and expert fees would be addressed in papers that were submitted by counsel. Each party submitted a post-trial brief and reply brief. The court has reviewed all submitted papers. During the trial, the plaintiff (the "Wife") presented evidence, without opposition, warranting a divorce on the grounds of constructive abandonment.

The parties married on June 27, 1981 in a religious ceremony in New York County. The Wife is 55 years old and the Defendant (the "Husband") is 58 years old. There are two children of the marriage, a son (born May 1983) and daughter (born February 2, 1985). Each child is emancipated although as of trial, the daughter still attended college on a part time basis.

Prior to the marriage, the Husband worked for his family's wholesale business, Interstate Cigar. He was fired from that job early in the marriage in 1985. He then set up his own wholesale business. The business operated under several names, including International Trade Expo ("ITE"), Allstate Clearing, Inc. ("Allstate") and, in 2000, Betlar Merchandising ("Betlar"). Except during the very early years of the business when the Husband had a partner, the Husband was the sole owner of these business entities.

The Husband's corporations engaged in what he called an opportunistic purchasing business, commonly referred to as "grey market" activity or diversion of product. Manufacturers in the United States produced and sold product overseas which the manufacturers intended for resale outside of the United States. These products were typically sold overseas for a lower price than comparable products sold within the United States. Working with agents in foreign countries, the Husband purchased the product intended for overseas markets, and upon its re-

delivery in the United States, sold the product to wholesalers at a price lower than if purchased directly from the manufacturer in the United States. Most of the products sold by the Husband's business were grocery items. The rest of the items were beauty or hair salon products.

Typically, ITE and, later, Betlar purchased the product with funds wired to overseas agents. Upon receiving the product, the company would warehouse the product, prepare it for resale (which sometimes required removing identification numbers), and deliver the product to the purchaser within the United States. Upon receiving payment for the product, the Husband calculated the percentage due to him for costs incurred and would then share profits on a deal-by-deal basis with the overseas agents. The money sent overseas might include in one transfer profits from a prior sale and payment for future product or just one or the other. ITE did not itself transfer the money overseas as a result of a lawsuit brought against ITE by Clorox. The Husband decided it was best to separate the buying and selling operations. Instead, ITE transferred money to Allstate which sent the funds overseas. Most frequently, Allstate wired money to Fortuna Trading Co. ("Fortuna"), an entity with a bank account in the Channel Islands, but other overseas business entities received funds from Allstate too. Fortuna was a business entity owned by Daniel Akerib, the Husband's primary overseas agent.

The Husband's business was run out of a studio apartment located in the same building where the parties resided, 425 East 58th Street, New York, New York (the "Studio Apartment"). Ultimately, the parties purchased the Studio Apartment.

The Wife, a college graduate, worked in sales before and early in the marriage. She sold cosmetics retail and then sold advertising for a magazine. She also worked in sales for her father's dress manufacturing business and as a secretary. She stopped working with the birth of the parties' first child. In 1991, once both children were in school, the Wife worked for the Husband's business. She became an integral part of its operation. The Husband often spent weeks traveling in Asia and Africa developing contacts with overseas agents. He testified that he traveled 25-30 percent of the time, although he traveled less in later years. The Wife managed the office. She maintained most of the companies' books and records and was responsible for wiring payments. She created and maintained the files for each deal. She tracked receipts and had contact with the various agents who worked for the business when they came to the office. She provided records to the accountant. She did not set the prices for any deal; the Husband determined the price. But the Wife spoke to the Husband, often several times a day when he was out of the country, to have him tell her at what price to buy or sell product. She then completed the deal.

The Wife also oversaw the family's finances. She deposited into the family's bank accounts all funds received from the business either as salary or distribution of profit and paid all of the family's bills. The parties maintained a joint account, but the Wife also maintained her own account. The Husband's salary received from his business over the years was typically in the range of $70-90,000 as reported on tax returns. The reported distributions received from the company averaged around $200,000-250,000 (but were significantly less in some years) (Ex. 8). The Wife testified that some of the family's bills were paid by her through the business. She testified that she also received for herself unreported "salary" of $1,700 to $1,900 a week from the business which she deposited into her own account.

At the time the parties' married, the Husband's family held stock in a company called Bambu Sales, Inc. ("Bambu"). The company manufactured and sold to wholesalers cigarette rolling paper. The rolling paper is commonly known to be used for smoking marijuana, although there is no evidence that Bambu was involved in the drug trade. The Husband did not own stock at the time of the marriage, but he received Bambu shares at three different points during the marriage: 1991, 1994 and 2005. In 1997, the Husband began to receive a salary from Bambu in the amount of $1,000 to $1,200 a week. Not only did this provide some additional money to the family, but it also enabled the parties to receive medical insurance through Bambu. The Husband also received approximately $700 a month to lease a car. As a shareholder, the Husband received distribution checks quarterly, although some portion of the distribution was used to pay taxes. The Wife testified that she often deposited the weekly salary received from Bambu into her own bank account.

From the proceeds received from the Husband's business and Bambu, the parties lived a very comfortable lifestyle. They initially lived in an apartment owned by the Husband's father at 425 East 58th Street, New York, New York. In 1989, the Husband's father gifted the apartment to the parties. In 1994, the parties sold that apartment and purchased a 3 bedroom apartment in the same building for $875,000 (the "Marital Apartment"). The parties spent $500,000 renovating the apartment. They also acquired two brownstones in the Red Hook section of Brooklyn and a vacant lot as investment properties. The parties employed a full time housekeeper/nanny. The children attended private schools, camp and participated in paid extracurricular activities. They had tutors. The couple purchased significant pieces of jewelry (although neither party placed a value on the jewelry acquired) and the Husband collected and traded motorcycles (the Wife testified that he spent approximately $350,000 on motorcycles over the years of the marriage). The parties rented vacation homes in the Hamptons for a number of years. They enjoyed occasional vacations in Italy, the Far East, and Florida, often related to business. They frequently dined in restaurants, Peter Luger's Steakhouse being a particular favorite.

By 1999, the parties experienced serious marital difficulties. The Husband came to learn that the Wife had an affair in 1996 with someone known to him. She commenced a divorce proceeding in 1999, but withdrew the action. The couple sought to reconcile and engaged in therapy. The Husband testified that as a result of learning of his Wife's infidelity, he gained significant weight and developed diabetes. He acknowledged that he too had an affair sometime after he learned of the Wife's affair. He claimed he lost interest in the business, but the evidence also revealed that the Husband created Betlar in 2000. The effort to reconcile failed. The Husband began to do less work for the business. Both parties agree that by 2005 the business was largely defunct, but they were able to draw money from the business for a time thereafter. The Husband's ownership share in Bambu had grown to 25.314 percent by 2005 and the distributions he receives have significantly increased.

Notwithstanding the reconciliation efforts, the Wife testified that she knew the marriage was dead in 1999. In 2004 she retained a divorce attorney who she met with 15 times in 2005 and 10 times in 2006. The Wife acknowledged that for several years preceding the divorce action, she alone used the Studio Apartment and that the Husband stopped coming to work. The

Husband testified that he was last in the Studio Apartment in 2006 on one occasion for a short period of time. The Wife commenced this action in 2007.

EQUITABLE DISTRIBUTION OF THE MARITAL PROPERTY

To distribute the parties' assets and liabilities, the court must first determine what constitutes marital property and the value of that property.

The Assets

Overseas Funds of ITE, Allstate and Betlar

The Wife contends that the Husband hid profits from his business in overseas accounts funneled primarily through Allstate to Fortuna in the Channel Islands, a Swiss bank account and to accounts in the Far East. She claims she did not realize the Husband was doing this until after the divorce action began when she reviewed some wire transfers. She testified that she confronted her Husband about the money and he said "You'll never find it."

In support of her position, she presented a report prepared by Holtz Rubenstein and Reminick ("HRR") (Ex. 80) and the testimony of an expert forensic accountant with that firm. After his review of the available business documents and certain depositions in this action, the accountant estimated that $13.4 million of the business' gross profits were unaccounted for. It is the Wife's position that the Husband drained this amount of money from the business.

Although copies of the business' and the parties' personal tax returns were provided, the accountant acknowledged that he had very few other business records available for review. All of the records had been maintained in the Studio Apartment. Both parties testified that a file was maintained for each deal entered into by the business. The file would include the date and cost of the purchase of product from overseas, records that the product was delivered to the warehouse, sale of the product to a wholesaler, and all wire transfers that occurred relative to the sale. Both parties concede that most of these records no longer exist. The accountant conducted his analysis relying on a limited number of pieces of files and some incomplete ledgers. The accountant also acknowledged that he did not have all of the business bank records. Moreover, he did not review any of the parties' personal bank accounts or credit card statements.

The Wife's theory fails on several grounds. Initially, the accountant opines "that $13.4 million in gross profits are unaccounted for." (Ex. 80, p. 1, emphasis added.). (In the conclusion of the report he eschews the word "gross". [Ex. 80, p. 20]). He provided a limited assessment of all of the necessary costs and overhead incurred in conducting the business. Such costs included the sharing of profits with partners to each transaction as testified to by the Husband, that would have to be deducted before determining the net profit available for distribution to the Husband's business.

The report provides the bald statement: "It would be unusual for an individual to operate in a high risk activity such as diversion of goods unless there was a potential for significant

income." (Ex. 80, p. 10). The accountant provides no basis to support this conclusion or whether this conclusion falls within the expertise of an accountant.

Furthermore, the accountant reached his conclusion of the gross profit margin for the Husband's business by comparing his business to the gross profit margins for groupings of businesses collected by The Risk Management Association. However, the businesses contained in the statistical groupings were not comparable to the husband's business. For instance, although some of the businesses in the studies sold drug sundries, some of the businesses included in the study sold pharmaceutical drugs, as well as chemicals and allied products. The Husband's business sold none of those types of products.

Even more to the point, as the accountant acknowledged, he did not provide a valuation. Rather, he merely contends that $13.4 million is unaccounted for. There is simply no evidence that these funds exist anywhere. The Wife conceded that she was unable to locate any funds in Europe or any of the entities that the Husband's companies did business with, even though she hired investigators to conduct searches.

Indeed, if anything, the evidence suggests that while the business earned profits, the parties themselves spent unreported earnings derived from the business. A review of the parties' tax returns over the years that the Husband's business flourished revealed that he regularly received a reported salary of under $90,000 and distributions that hovered around $250,000 (although in some years he received significantly less in distributions). Yet during these years, the parties purchased and, at a cost of $500,000, renovated the Marital Apartment. They purchased the Studio Apartment, as well three investment properties in Brooklyn. The children attended private schools, had tutors and attended private camp. The parties rented summer homes in the Hamptons and went on trips abroad. The Husband purchased motorcycles or parts and they each purchased jewelry. The Wife conceded that she took unreported salary for herself in the amount of approximately $100,000 each year. Furthermore, the Wife conceded that the business regularly paid many of the parties' personal expenses.¹

It is more than a little curious that most of the business records do not exist. The Wife seeks to blame the Husband for this fact, but the evidence established that the Wife had as much, if not more, control of the records. She concedes that she regularly used the Studio Apartment where the business records were located, while the Husband stopped going to that apartment in 2005. The Wife began to seriously confer with divorce attorneys in 2004. She gave no evidence regarding the state of the records at that time or why she did not secure the records then. Furthermore, the Wife had access to the business bank accounts and signed wire transmissions. She had at least as much, if not more, access and opportunity to hide business funds as did the Husband.

For all of these reasons, the court concludes that the Wife failed to prove that the Husband dissipated or hid marital assets derived from his business.

Bambu

Bambu existed long before the parties married. Originally, the Husband's father and his two siblings were the primary owners, but other family members and non-family members were shareholders (including Bambu's attorney, accountant and at least one employee of the family's other business). Over time, the Husband's parents acquired the shares held by other family members. According to the Husband's mother, these transfers were not recorded. She further testified that the company was run for a time by her son-in-law. He died in 1993 and she testified that some of Bambu's records were discarded at that time.

Although the business brings in a good income for the family now, in the 1980s and 1990s, the company was embroiled in several litigations resulting in Bambu or the Husband's mother having to pay significant sums of money to third parties. Ultimately, by buying out the other shareholders, and making the necessary legal payouts, the company stabilized. However, this process did not begin to resolve until 1997 after the Husband's uncle was bought out and litigation to dissolve Bambu was settled.²

The Husband's mother credibly testified that Bambu largely runs itself. She and her sister manage the day-to-day operation of the business. There is one manufacturer of the rolling paper, a company located in Spain. The paper is delivered to a warehouse near Newark airport. It is shipped to distributors who have worked with the company for many years. The mother testified that she sits by the phone and takes orders. Her sister writes the checks needed to pay for product or salaries and distributions. The mother signs all checks.

Both she and the Husband testified that although he is an employee of Bambu, he does no work for the company. He receives a salary so that the company can provide him health insurance. There is evidence that he attended one shareholders meeting in 1995, and that the mother may discuss the business with her children, but both the mother and Husband testified that the mother makes all business decisions. The only change in the business product was a recent effort to sell some clothing (e.g. tee-shirts) with the company logo. No credible evidence contradicted their testimony.

The Husband's Ownership Interest in Bambu

The Husband acquired Bambu shares at three different points of time during the marriage. Most recently, the Husband's mother transferred to him shares equivalent to an 8.011 percent interest in Bambu in January 2005. The mother transferred the same number of shares to her other children at that time and the gift is reflected in tax returns. The Wife concedes that these shares are the Husband's separate property.

1991 Transfer of 7.194 percent Interest in Bambu

In 1991, the mother transferred to the Husband shares equivalent to a 7.194 percent interest in Bambu. The Husband asserts that these shares are his separate property having been gifted to him by his mother. The mother testified that her husband had, before his death, given the same percentage of shares to each of the couple's two daughters. She stated that her husband believed that the daughters and mother would need income derived from the business, whereas the son was able to work and earn his own income. After her husband's death in 1989, the mother believed she had enough money to meet her own needs and wanted to equalize the number of shares each of her children owned. Accordingly, she transferred the same number of shares to the Husband in 1991 as had previously been given to his siblings. The mother claims there are no documents reflecting this transfer because the company is a small family business, they never issued stock certificates, and many early documents of the business were not preserved.

The Wife countered that not only are there no corporate documents to reflect the transfer, but the transfer is not reflected on any tax returns. She contends that the shares were given to the Husband to prevent him from going into competition with Bambu. After the Husband was fired from his family's business in 1985, he was able to buy a supply of Bambu cigarette paper from a former manufacturer of the paper in Spain. The Husband then sought to sell the paper. To avoid the potential harm to Bambu, the corporation bought the paper from the Husband in 1991 and, in return paid him cash and transferred the Bambu shares to him. It is her contention that these shares are marital property.

The Husband concedes that in 1987 he entered into an agreement to buy cigarette paper from a manufacturer in Spain who had previously produced paper for Bambu. The terms of the agreement specifically precluded sale of the product in places where Bambu held a trademark (Ex. 7). In 1987 and 1988 he filed to register the Bambu trademark for his own company in countries where the trademark had not been registered by Bambu. In 1987, his partner at the time, John Lawrence, made a two week trip to the Carribean and Central America to try to sell the product and was able to sell a small quantity of rolling paper in Barbados (Ex. 90). However, the Husband ultimately concluded that there was no market for the product in these areas and that his fledgling business could not afford to expend more money trying to sell the product or the cost of warehousing the paper. Finally, in 1991, he entered into an agreement to sell the remaining product he possessed to Bambu in return for $46,035. The payment for the product was made on behalf of Bambu by the Husband's mother and brother-in-law as reflected in a letter agreement, dated December 31, 1991. There is no mention in that letter of any transfer of stock (Ex. 86).

The court rejects the Wife's position and, from the credible evidence, concludes that these shares are the Husband's separate property. There is no evidence to support the Wife's contention that the shares were transferred to the Husband as part of the payment for the rolling paper he possessed. In the first instance, the Husband did not attempt to compete with Bambu. He did not try to infringe on Bambu's business by endeavoring to sell the product in areas where Bambu held a trademark. The Wife presented no evidence that in 1987 and 1988 when the Husband sought to register trademarks in other countries or actually sold the product that Bambu took any action. Surely if Bambu was concerned about protecting its trademark, it would have acted much sooner to come to an accommodation with the Husband to halt his activities. Indeed, as the Wife's own expert found, Bambu carefully monitors and pursues potential infringements

on its trademark (Ex. 93, Main Report, pp. 10-11) Yet it wasn't until four years after the Husband began trying to sell his product that an agreement was reached whereby Bambu purchased the rolling paper from the Husband. Given that time lag, it is more credible to believe the Husband's testimony that Bambu's purchase of his rolling paper stock merely helped him out of a bad business decision. There was no evidence presented that the Husband endeavored to sell the paper at the behest of Bambu.

The court recognizes the heavy burden that a spouse faces in establishing that an asset acquired during the marriage is separate property, Price v. Price, 69 N.Y.2d 8, 15 (1986); Davis v. Davis, 128 A.D.2d 470 (1st Dept1987); Fields v. Fields, __ N.Y.3d __, 2010 NY Slip Op 04871 (2010); and concludes that the Husband met his burden. The court finds that his mother testified credibly to the events resulting in the transfer of shares to the Husband and that there is no basis to believe the transfer was in any way connected to the Husband's sale of the rolling paper to Bambu. Given how this company operates, the lack of documentation to support the transfer does not defeat the Husband's claim that these shares are his separate property

1994 Purchase of the 2.641 percent interest in Bambu owned by Joseph Cutuli

Joseph Cutuli was a longtime employee of Interstate Cigar, handling transportation and distribution of product for that entity. For his services, he received 4.826 shares of common stock in Bambu. In 1994 he was approached by Alan Sills, an attorney representing the Husband's mother, to see if he wanted to sell his shares. Cutuli was anxious to do so. On October 28, 1994, he entered into an agreement with the Husband and his two sisters to sell the shares to them. (Ex. 87). Both Cutuli and the mother testified that the mother paid for the stock, but no documentary evidence was offered to support this claim.

The Husband argues that these shares are his separate property in light of the fact that his mother actually paid for them. The court rejects this argument. There is no evidence that this stock was acquired by the Husband as a gift from his mother. The only written document involving this sale indicates that the shares were purchased from Cutuli by the Husband and his sisters. The fact that the mother may have paid for the shares does not require a finding that the shares were a gift from her to her children. In light of the strong policy in finding property acquired during the marriage to be marital property, the Husband must meet his burden to establish that a claimed asset is separate property. The court finds that the shares owned by the Husband derived from the Cutuli purchase are marital property. Fields, supra.³

Appreciation of the Husband's Separate Property Bambu Ownership Interest

To the extent that the court finds that any of the Husband's ownership interest is separate property, the Wife contends she is entitled to a distribution of the appreciation in value of the Husband's separate property interest in Bambu. As set forth above, the court finds that the shares received by the Husband in 1991 and 2005 are the Husband's separate property.

The determination that the value of appreciation of separate property may constitute marital property was articulated in the seminal case Price v. Price, 69 NY2d 8 (1986). The Court of Appeals held that "Where separate property of one spouse has appreciated during the marriage…and where such appreciation was 'due in part' to the contributions or efforts of the nontitled spouse as parent and homemaker, the amount of that appreciation should be added to the sum of marital property for equitable distribution (§236 [B] [5]). Whether assistance of a nontitled spouse, when indirect, can be said to have contributed 'in part' to the appreciation of an asset depends primarily upon the nature of the asset and whether its appreciation was due in some measure to the time and efforts of the titled spouse." Price v. Price, 69 NY2d at17-8.

Nine years later, the Court elaborated on this holding in Hartog v. Hartog, 85 NY2d 36 (1995). Mr. Hartog, was the titled spouse of separate property family businesses. He was minimally involved in the operation of two companies. He urged the Court to find that unless the Wife could show a definitive and direct nexus between his activities and the appreciation in value of those businesses, any appreciation in value should be deemed to have accrued passively and not subject to equitable distribution. The Court disagreed and placed a lesser burden on the Wife "When a nontitled spouse's claim to appreciation in the other spouse's separate property is predicated solely on the nontitled spouse's indirect contributions, some nexus between the titled spouse's active efforts and the appreciation in the separate property is required." 85 NY2d at 46.

Mr. Hartog, in addition to being a shareholder, was a director and officer of the business, attended board of director meetings, discussed and conferred on business matters, signed checks on occasion, was a salaried employee and participated in the business profit-sharing plans. Although his participation was infrequent, these roles were sufficient to find that he was actively involved in the business and had a management role. "Through the husband's attendance at Board meetings and business discussions with family members, particularly during times of crisis, a reasonable finder of fact could determine that this active involvement contributed to the appreciated value of the businesses." 85 NY2d at 49.

This court finds that the Husband here does not have the same relationship with Bambu as Mr. Hartog was found to have with his family's business. The Husband was never an officer of the corporation. Although there is evidence that he attended one shareholders' meeting in 1995, there is no evidence that he attended any meetings of the Board of Directors. There was no evidence that he participated meaningfully in any business discussions. He does not sign checks for the company and there is no evidence that he participates in deciding the amount of distribution given to shareholders each year. The Wife's expert reported on the significant number of litigations confronted by Bambu in the 1980s and 1990s. Yet, other than innuendo raised by the Wife, there is no evidence that the Husband played any role in these matters.

The Wife argues that since the Husband received a salary from Bambu, he performed some service for the company. She relies on one response by the Husband's mother during her deposition when she said that the Husband worked for Bambu. However, at trial, the mother elaborated that since the Husband receives a salary she felt compelled to say he did something, even though he does not, to justify his receiving income and health insurance benefits. At most, it appears that on occasion the mother discusses her business plans with each of her children during informal discussions, but she and the Husband credibly testified that any business

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decision was always made by the mother. For all of these reasons, the court concludes that the Wife failed to meet her burden that she is entitled to a portion of any appreciation in the value of the Husband's separate property interest in Bambu. Golub v. Ganz, 22 AD3d 919 (3d Dept 2005); Lawson v. Lawson, 28 AD2d 795 (3d Dept 2001)

The court further notes that the Wife failed to provide convincing evidence regarding the amount of the appreciation in value of Bambu. The Wife presented the testimony of a forensic accountant who conducted a series of valuations based on the different dates of the Husband's acquisition of shares and different valuation dates depending on whether the asset was considered marital or separate property. The court finds his conclusions sufficiently biased to the Wife's benefit that they lack reliability.

The court will highlight only a few problems with the valuation. In determining a base net free cash flow figure for the 2007 or 2009 valuation dates, the expert did not take an average of the past three years of the company's financial picture but used only the most recent year. He assumed an unrealistic perpetual growth rate for Bambu and concluded an increase in the growth rate from 2007 to 2009 based on the introduction by the company of a clothing line. However, he acknowledged that the only information he had regarding the clothing line came from a newspaper article and not from financial documents. In addition, he failed to adequately account for the specific risk factors attendant to this company.⁴

Accordingly, the court finds that the even if the Wife had proven she was entitled to a portion of the appreciation of the Husband's separate property, she failed to meet her burden in proving the value of the appreciation of the separate property. Davis v. Davis, 128 AD2d 470 (1st Dept 1987).

Real Estate

The Marital Apartment

Pursuant to a stipulation entered into by the parties on October 16, 2007, the Marital Apartment was sold and the net proceeds ($3,168,400) distributed 50 percent to each party, except that the Wife deducted $50,000 from the Husband's share due to damages claimed by the buyers to have been done to the apartment. The Wife contended that, of the parties, the Husband last resided in the apartment. However, the daughter also resided in the apartment immediately prior to the sale. The buyers demanded $100,000 which the Wife negotiated down to $50,000. The Husband did not attend the closing. The Wife apparently did not conduct her own walk-through. The Wife seeks to hold the Husband fully responsible for the $50,000 liability. The Husband

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claims since he was never consulted, this amount should be distributed equally in accordance with the parties' stipulation. Contrary to the Wife's position, the court concludes that this $50,000 is marital property.

The Studio Apartment

Vacant Lot — 297 Van Brunt Street, Brooklyn, NY

The parties agree that these properties will be sold and the net profits distributed equally. Neither party has ascribed a value to these assets. The parties previously sold two other properties in Brooklyn and distributed the profits.

Motorcycles

Throughout the marriage, the Husband purchased, sold and exchanged motorcycles as a hobby. The evidence established that many times, the Husband purchased cycles in disrepair and then refurbished the bikes. Sometimes he purchased vehicles in good condition. The Husband testified that he frequently sold or traded bikes after he refurbished them. The trades or sales would occur at "swap" events attended by other hobbyists. No documentation exists of these trades. The Wife contends that the Husband expended almost $350,000 during the marriage for this hobby and, contrary to his claim, never sold or traded his bikes. She also testified that in 2003, the Husband wrote a list of motorcycles and parts with dollar values totaling $1,240,000. The Wife testified that she asked the Husband to prepare the list because she was concerned about the amount of money they had spent on motorcycles and wanted to know their value and location. She claims the list accurately assigns value to the motorcycles owned by the Husband at that time. (Ex. 18). The Husband testified that he prepared the list in 2001. He and the Wife were arguing over the amount of money he spent on motorcycles. He contended that the list included not only cycles he owned, but ones he would like to own.

The parties agreed to have the motorcycles possessed at the time of the commencement of the action valued by a neutral expert, Peter Gagan. Mr. Gagan is a motorcycle consultant and has been involved with motorcycles almost all of his life. He has written a book on motorcycles and is regularly consulted by auction houses and individual owners on the valuation of cycles. Mr. Gagan conducted his valuation using photographs provided by the Husband since the motorcycles were in different geographical locations. (Ex. T). He concluded that the value of the bikes from the inventory he was given was $28,975. (Ex. U). The court found Mr. Gagan to be a credible witness.

The Wife does not really take exception to the expert's valuation, but claims he was not given an accurate inventory to value. In particular, she claims that the Husband skewed the appearance of the motorcycles to cause the expert to downgrade their value. However, it does not appear that the Wife objected to the inventory provided to the expert prior to trial. Accordingly, the court accepts, Mr. Gagan's valuation with respect to the inventory he was asked to value. In addition, the parties stipulated to the value of $6,500 for one additional motorcycle (Harley Davidson Road King Classic) not included in the inventory.

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The Wife's primary objection is that she claims that much of the motorcycle collection has disappeared. Given the time and money spent on this hobby, she finds it incredible that the collection is gone. She notes that the inventory of bikes given to the expert to appraise consisted of only 25 bikes whereas the Husband testified that he owned as many as 58 bikes at one time. She further notes that one of the bikes was so unique it was featured on a United States postage stamp and that it is inconceivable that the Husband parted with that cycle. The Husband does not dispute the claim that he expended significant funds during the marriage on his hobby, but counters that he never possessed the collection the Wife asserts he had. In any event, the Wife's claim regarding the number and condition of the cycles goes back to at least 2003, four years before this action began. The Husband concedes that after the commencement of this action he gave 4 motorcycles, including the bike pictured on the stamp, to his former business partner, Daniel Akerib, to repay, in part, a purported outstanding loan in the amount of $200,000 extended to the Husband at the time the parties bought their marital residence in 1994. The Husband claimed that the bikes repaid $100,000 of that loan. The Husband offered no documentary evidence of that loan. Mr. Akerib, who had been on the Husband's witness list, was never called to testify. The Husband testified that the only other bikes he still possessed were the ones in the inventory, or stipulated to as marital or separate property and that any other bikes he once possessed he had swapped or traded prior to the commencement of this action.

There is no evidence that he possessed any other bikes at the commencement of the action as claimed by the Wife. Moreover, when shown Ex.18, on which the Wife so strongly relies, Mr. Gagan found the listed prices for the bikes "generous."

The court cannot place a value on assets no longer in existence and cannot conclude that the Husband dissipated these assets. See, Mahoney-Buntzman v. Buntzman, 12 N.Y.3d 415 (2009). However, the court will add back to the marital property $100,000 for the motorcycles given to Mr. Akerib. Thus, the court finds the value of the motorcycle collection to be $135,475 and that this value is martial property.

Jewelry

There is a quantity of jewelry being held in a safe deposit box. Neither side had the jewelry appraised. This court initially issued an Order during trial (October 30, 2009) requiring the parties to sell the jewelry. That Order was held in abeyance in a subsequent Order dated April 20, 2010. Neither side presented sufficient evidence to establish that any jewelry is separate property. Accordingly, all jewelry held in the safe deposit box is martial property.

Brokerage Accounts/Securities

The parties agree that the following account is marital property and agree to its value:

Citibank…6218 $267,237

The parties agree on the value of the following accounts:

Citibank…0723 $530,479

*13

Citibank Annuities $582,939

The Husband contends that these two assets are 100 percent marital property. The Wife argues that she is entitled to separate property claims against these two assets.

The Wife testified that during the marriage she inherited money from her mother. Her mother died in March 2003. The Wife claimed that her mother told her to withdraw funds from the mother's bank accounts prior to her death. The Wife points to two deposits she made in December 2002 and January 2003 totaling $88,000. The Wife claims that she withdrew these funds from her mother's account. In addition, she also claims she received $390,763 from the estate after her mother passed away. It is the Wife's contention that these funds constitute her separate property. The Husband counters that to the extent the Wife received money from her mother, the funds were co-mingled with the parties' other property and have been transmuted into marital property. It is well-established that where separate assets are co-mingled with marital assets the separate property becomes transmuted into marital property. See, Popowich v. Korman, 73 A.D.3d 515 (1st Dept 2010); Wiener v. Wiener, 57 A.D.3d 241, 244 (1st Dept 2008); Glazer v. Glazer, 190 A.D.22d 951, 953 (3d Dept 1993).

The court finds insufficient evidence presented to support the Wife's contention that she

*14

received $88,000 from her mother. The Wife presented no evidence of withdrawals from her mother's account to match the deposits the Wife made into her own account.

However, the court finds that the Wife presented sufficient evidence to support her claim that she inherited $390,763 from her mother. She recalled the exact amount from her review of the mother's estate tax return. The Wife claims she deposited this amount into her separate checking account and used $268,882 of these funds to purchase an annuity. She also claimed that she loaned Betlar $100,000 and presented a check on her account for this amount. The court finds insufficient evidence to support the Wife's claim that she used her separate property to loan money to Betlar, especially given that the parties seemed to use the business and personal bank accounts interchangeably for personal expenses. However, the court is satisfied that the Wife has proven that she inherited and traced $268,882 and will accord her this claim of separate property. Pullman v. Pullman, 176 A.D.2d 113, 114 (1st Dept 1991).

Thus, the Wife is entitled to $268,882 as a separate property credit against these assets.

Bank Accounts

The parties agree that the following accounts are marital property and further agree to the vlaue of these accounts:

Citibank…8727 $36,162

Citibank Betlar…0693 $211,156

Wife's Citibank…7702 $60,791

Wife's Citibank Savings…1117 $49,946

Metlife shares

The parties agree that the 1,365 Metlife shares owned in the Husband's name are marital property. By stipulation, dated October 20, 2009, the parties agreed that the value of these shares as of the date of trial was $53,016. (Ex. KK). However, the stipulation left for trial the manner in which these assets would be distributed

Life Insurance

The parties agree that the following life insurance policies are marital property and agree to the cash value of these polices:

Met Life…060A $85,159 (Death benefit: $573,817)

Met Life…055A $229,121 (Death Benefit: $1,712,451)

New York Life…642 $237,858 (Death Benefit: $953,306)

Retirement Accounts

*15

The parties agree that the following retirement accounts are marital property and agree to the value of these accounts:

Wells Fargo IRA…2377 $7,225

Citibank ITE Profit Sharing Plan $25,681

Automobiles

The parties agree that the following vehicles are marital property and agree to their value:

1983 Mercedes Benz de minimis

2004 Mercedes Benz CLK $18,575

2005 GMC Denali $15,000

Other Property

The Husband argues that after the commencement of this action, the Wife purchased approximately $200,000 of beauty products and home supplies. He contends that she is stockpiling these products with a view to going into business to sell them. He contends that he should receive a credit against these expended funds.

The court rejects the Husband's argument and denies his claim. During this period of time, the Wife cleared out the Studio Apartment, the daughter moved into that apartment and the Wife moved into her own rental apartment. Expenditures were necessary to accomplish these purposes and were not, when taken as a whole, unreasonable. Moreover, as the Wife's attorney correctly notes, if the Wife intended to go into business, it is hard to imagine she would make the purchases from retail stores.

The Husband's HSBC Bank Accounts

The parties agree that the money deposited in the following accounts contain a portion of the Husband's share of the proceeds of the sale of the Marital Apartment and are his separate properties:

HSBC…752-8 $361,834

HSBC…442-5 $463,468

Rock Ridge Holdings LP

Each party was to use his or her share of the proceeds from the sale of the Marital Apartment to purchase a new residence for themselves, but apparently neither party did so. The Husband, instead used some of his share to invest in an entity called Rock Ridge Holdings L.P. This was a post-commencement investment. The Husband claims to have lost money. The Wife

*16

seeks no portion of this investment. The Husband bears the consequences of his loss. The amount of the Husband's holding in this asset as of the date of trial is $844,179

Security Deposit

The Husband rented an apartment post-commencement and posted a $12,000 security deposit. The Wife seeks no claim to this money. It is the Husband's separate property. (Ex. KK).

Akerib Loan

The Husband claims he borrowed money from his business associate, Daniel Akerib, at the time the parties purchased the Marital Residence, and that at the time of commencement of this action, $200,000 remained outstanding. He offered no documentary evidence of the existence of that loan or why it remained outstanding for all of these years. The court finds the loan does not exist or, if it does, the Husband is solely responsible for its repayment.

Statutory Factors

Marital property must be distributed equitably upon consideration of the circumstances of the case and the respective parties. DRL §236 (B) (5) (c). The court has considered each of the factors set forth in DRL §236 (B) (5) (d) to the extent applicable in reaching its decision.

This was a long term marriage. The parties are in their mid to late fifties. The Husband testified to be suffering from some medical issues, including diabetes (although no medical records were presented to substantiate his claims). The Wife appears to be in good health. It is unlikely that either party can achieve the same earning capacity they each previously enjoyed. At the time this action commenced, neither party was working, although the Husband received distributions and a salary from Bambu. The Husband suggested that the Wife may be receiving some income from the sale of cosmetics, but there was no evidence to support this claim. DRL §§236 (B) (5) (d) (1), (2) and (8)

The children of the marriage are emancipated. As a result, there is no need for one parent to occupy the marital residence and, in fact, the parties have already sold it and largely distributed the proceeds of the sale. DRL §236 (B) (5) (d) (3).

The retirement funds that exist are available for distribution. However, it is worth noting that the Husband will leave the marriage with a substantial separate property interest in Bambu. The Wife will lose any potential inheritance right she may have had to that asset. However, she will receive as her separate property money derived from the inheritance from her mother's estate. DRL §236 (B) (5) (d) (4)

Both parties agree that the Wife should receive an award of maintenance. They disagree on the amount and duration of that award. The court has considered its award of maintenance (see below) in fashioning the distribution of the marital property. DRL §236 (B) (5) (d) (5).

*17

Both parties fully contributed to the marriage. They worked effectively as partners in the Husband's business and contributed to its years of success. The Wife played the primary role in caring for the children of the marriage when they were young. Both parties participated in household responsibilities — the Wife took care of the family's finances; the Husband shopped for groceries and, on occasion, cooked. Each party has an equitable claim to the property acquired during the marriage. The Wife contributed to the acquisition of the martial property by her work for the husband's business and as homemaker; the Husband contributed as the primary wage earner and his help around the home in meeting the family's needs. DRL §236 (B) (d) (5) (6)

Most of the marital property is liquid, subject to division, or can be sold. To the extent that marital property, in particular the interest in Bambu, has not been valued, distribution is still possible. There has been no evidence presented that any property needs to be held intact. DRL §§236 (B) (d) (5) (8) and (9).

There is no evidence of any tax consequences to either party that needs to be considered. DRL §236 (B) (d) (5) (10).

The Wife claimed that the Husband hid business assets. The court finds there was insufficient evidence to support her contention. Similarly, the Husband contends that the Wife dissipated assets. The court concludes that although the Wife concedes taking unreported income from the business, the Husband was in a position to know of the money she expended. Moreover, it appears that she used at least some of the money for family expenses. There is insufficient evidence that she otherwise hid or dissipated assets. DRL §§236 (B) (d) (5) (11) and (12).

There is no other factor the court need consider. DRL §236 (B) (d) (5) (13).

Distribution

Upon consideration of these statutory factors, the court distributes the marital property as follows:

The parties will sell and each receive 50 percent of the net profit from the sale of the Studio Apartment and the lot located at 297 Van Brundt Street, Brooklyn, NY.

As set forth above, the $50,000 the Wife withheld from the sale of the marital property as the cost necessary to pay the buyers of the Marital Apartment is marital property. The court finds that both parties poorly handled the sale of the Marital Apartment. The Husband, as the last resident, was responsible for making sure the apartment was clean. However, nothing prevented the Wife from making sure the apartment was in good order prior to the closing. Moreover, her decision to reduce the sales price of the apartment by $50,000 without her own inspection of the property was unwarranted. Accordingly, the court finds that each party is responsible for $25,000 of this cost. The Husband is entitled to a $25,000 credit from other assets.

*18

The motorcycle collection is valued at $135,475. The Husband will keep the motorcycles and the Wife will receive $67,737.50, less $25,000 from the closing cost set forth above, for a total of $42,737.50 from other assets.

The Citibank Annuities are marital property valued at $582,939. However, the Wife is entitled to a credit for her separate property inheritance in the amount of $268,82. She is also entitled to $42,737.50 for the value of the motorcycles. Accordingly, the Wife will receive $447,279.25 and the Husband shall receive $135,659.75 of this asset. The parties shall cooperate in completing any paperwork necessary to effect this distribution. The court notes that assets need not be distributed equally. Arvantides v. Arvantides, 64 N.Y.2d 1033, 1034 (1985); Naimollah v. DeUgarte, 18 A.D.3d 268 (1st Dep't 2005). In awarding this distribution, the court has considered the Husband's separate property ownership in Bambu that will provide him significant income going forward. Moreover, awarding the Wife a greater portion of the annuities will be a factor the court will consider in awarding maintenance.

The following accounts will be distributed 50 percent to each party:

Citibank…6218 $267,237

Citibank…0723 $530,479

Citibank…8727 $ 36,162

Citibank Betlar…0693 $211,156

Wife's Citibank…7702 $ 60,791

Wife's Citibank Savings…1117 $ 49,946

Total $1,155,771

Accordingly, from these accounts the parties will each receive $577,885.50

The Husband's 2.641 percent interest in Bambu derived from his purchase of shares from Joseph Cutuli is marital property. Each party shall receive 50 percent of this asset. For the reasons previously stated, the court finds there was inadequate proof as to the value of these shares. Thus, each party shall receive a 1.3205 percent interest in Bambu. Contrary to the Husband's claim, there was no evidence that these shares are held in trust and therefore, no impediment exists to this distribution being made. The Husband shall cause appropriate documentation to be issued to the Wife to record her interest in this asset and to ensure her receipt of distributions made by Bambu.

The parties own 1,365 shares of MetLife. At the time of trial, these shares had a value of $53,016. However, in light of market fluctuations, the court finds it appropriate to distribute 50 percent of the shares in kind to each party.

The cash value of the following life insurance policies shall be distributed 50 percent to each party.

Met Life…060A $85,159

Met Life…055A $229,121

*19

Total $314,280

Accordingly, from these policies, each party will receive $157,140.

A third life insurance policy, New York Life…643, with a cash value of $237,858 and a death benefit of $953,306, shall be maintained by the Husband to protect the award of maintenance. DRL §236B (8) (a). The Wife shall be named the beneficiary. When the Husband reaches the age of 75 he shall have the right to cash in this policy or change the beneficiary. The Husband will then pay the Wife $168,929 representing 50 percent of the cash value of the policy at the time of trial. If the Husband elects to maintain the policy for the benefit of the Wife, he will not owe her this cash value. In the alternative, the parties can agree to redeem this policy immediately and each receive 50 percent of its cash value. If the parties reach this agreement, no insurance will be required to protect the maintenance award.

The value of the retirement accounts are:

Wells Fargo IRA…2377 $ 7,225

Citibank ITE Profit Sharing Plan $25,681

Total $32,906

The automobiles owned by the parties have a total value of $33,575. The Husband shall retain the cars and shall transfer 100 percent of the retirement accounts to the Wife.

The jewelry held in the safe deposit box shall be sold and each party shall receive 50 percent of the proceeds. The jewelry will be sold by an agreed upon agent within 90 days of this decision.

Maintenance

The court may award maintenance where justice requires, having regard for the standard of living established during the marriage, the lack of sufficient income and property to provide for the reasonable needs of the recipient, and the ability to pay by the other party, as well as the circumstances of the case and the respective parties. DRL §236 (B) (6) (a). This court has considered each of the factors set forth in DRL §236 (B) (6) (a) to the extent applicable in reaching its findings.

The Wife will receive distributions in cash of over $1,000,000. Some of the distribution includes annuities. She will also receive 50 percent of the marital assets that still need to be sold, including real estate and jewelry. She received $1,788,000 from the sale of the Marital Apartment. She will also receive distributions from her percentage ownership in Bambu. Although the court does not have evidence of the actual value of some of the assets to be distributed, it is reasonable to assume that the Wife will have received well over $3,000,000. Based on past performance, it appears that the Husband will continue to receive distributions and salary from Bambu. The court recognizes that the Husband's ownership interest in Bambu, as well as any appreciation in the value of his interest, has been found to be largely his separate property. DRL §236 (B) (6) (a) (1).

*20

As previously noted, this was a long-term marriage. The parties are in their mid to late fifties. The Husband testified that he suffers from diabetes. The Wife is in good health. DRL §236 (B) (6) (a) (2). The children of the marriage are grown and need no parental care. DRL §236 (B) (6) (a) (6). The Wife did not delay developing an earning capacity as the result of having foregone employment to care for the children. The Wife worked for the Husband's business after the youngest child began to attend school. The Wife made significant contributions to the marriage and her Husband's career, both as the primary homemaker and as an employee of the Husband's business. However, it is unclear that the Wife's work experience enables her to find significant employment in today's job market. Each party presented expert testimony regarding the Wife's present earning capacity. The Husband's employment expert testified that in his opinion the Wife could market herself as a sales representative and could eventually earn approximately $80,000. The Wife's employment expert testified that she could earn in the range of $25-35,000. Although it does not appear that the Husband will likely work again, he will receive significant distributions and salary from Bambu. In 2009 he received salary and distribution from Bambu of approximately $1,000,000. DRL §§236 (B) (6) (a) (3), (4),(5) and (8).

Notwithstanding the parties' contentions, the court finds no evidence exists to support a conclusion that either party dissipated marital property. Rather, the court finds that the parties regularly paid for personal expenses from business accounts. It also appears that each party on occasion used marital funds for his or her own purposes and, perhaps, against the other parties' interest. The Husband spent significant money on motorcycles. The Wife, without the Husband's consent, may have used a greater share of the proceeds of the sale of Brooklyn properties previously owned by both parties for her own purposes. The court does not find any of these expenditures to constitute wasteful dissipation. Similarly, there is no evidence of a transfer of property in contemplation of this divorce action, except to the extent that money may have been used for attorney fees. Although each party suggested that the other hid funds or drew a greater share of marital funds for his or her own purpose, the evidence presented is not of such quality as to affect this court's maintenance decision. §§236 (B) (6) (a) (9), (10). No other statutory factor warrants consideration.

From all of these factors, the court concludes that an award of maintenance is appropriate. The parties lived an above-average lifestyle and enjoyed certain luxury items. However, it was not an extravagant lifestyle. The evidence revealed that the Husband receives substantial remuneration from Bambu, sufficient to enable both parties to enjoy a comfortable lifestyle. Although it is conceivable that the Wife could obtain employment, neither expert suggested that she could ever earn sufficient income to match the marital lifestyle. Moreover, given her age, it is questionable if she could develop a career that would make her truly self supporting. It is ironic that while the Husband claims he need not work (although he never provided medical documentation to support his claim), he contends that the Wife is capable of working. However, the Wife will receive significant assets from the distribution of the marital property, including most of the parties' annuities and retirement accounts. By granting the Wife maintenance, her assets will be able to grow, providing her greater financial security as she ages.

*21

The court has reviewed the Wife's most recent net worth statement (Ex. 41) and has considered her testimony regarding her expenses. Certain of the expenses will no longer exist after the distribution of the parties' assets (e.g. the costs for the Studio Apartment). Moreover, the Wife conceded that she had been paying some of their daughter's expenses. That either parent may want to assist a grown child is admirable, but not the proper subject of a maintenance award.

In light of all of these factors, the court awards the Wife $14,000 a month in maintenance, taxable to the Wife and deductible to the Husband. This award shall be in effect from September 1, 2010 until August 31, 2013. Effective September 1, 2013, and until August 31, 2018, the Husband shall pay to the Wife maintenance in the amount $10,000 a month, taxable to the Wife, deductible to the Husband. Thereafter, the Husband shall pay permanent maintenance of $5,000 a month, taxable to the Wife, deductible to the Husband. This award shall terminate in accordance with the provisions of DRL §236 (B) (6) (c).

The Pendente Lite Maintenance Awards, Arrears, Security for Future Maintenance Payments

The parties engaged in extensive pre-trial litigation regarding the parties' assets and support for the Wife. Initially, it was agreed that the Husband would deposit a certain amount of money into the parties' joint bank account from which the Wife would draw money for her own needs and payment due on certain of the parties' assets. By order dated April 16, 2008, Justice Joan Lobis, then presiding over this case, directed the Husband to deposit $405,024 from funds distributed to him by Bambu into the parties' joint bank account and allowed the Wife to draw $200,000 from those funds for her own use. Judge Lobis further ordered at that time that if the Husband failed to deposit the requisite funds, the Husband would be required to pay $18,000 a month in tax-free pendente lite maintenance, retroactive to September 25, 2007.

The Husband did not deposit the $405,024, but instead tendered a check to the Wife in the amount of $112,000 with the explanation that the sum reflected the Wife's share of distributions paid to the Husband by Bambu, less taxes he needed to pay in connection with those distributions. Over the Wife's objection, the Husband deposited the $112,000 into the Wife's checking account.

The case was transferred to Justice Jacqueline Silbermann. In Motion Sequence 10, the Wife sought to invoke the default provision of Judge Lobis' Order requiring the Husband to pay $18,000 per month as tax free interim maintenance, plus $5,000 per month in retroactive arrears for his failure to deposit the full $405,024 in the parties' joint bank account. Judge Silbermann granted the Wife's application, but ordered that the maintenance would be retroactive only to May 1, 2008, two weeks after the date of Judge Lobis' order. Judge Silbermann based her decision, in part, on the fact that the Wife had received $112,000. Moreover, the Husband had paid taxes on the Bambu distribution. (Ex. 71)

The Wife now contends that she is entitled to arrears of the pendente lite support. The Husband did not owe the taxes in 2007 that he claimed he had to pay on the Bambu distribution. The Wife argues that she should receive $88,000 in accordance with the Husband's obligation to deposit the full amount of his Bambu distribution of $405,024 of which the Wife should have received $200,000 but only received $112,000.

*22

The Wife's application is denied. Judge Silbermann's award to the Wife of retroactive maintenance addressed the arrears owed to the Wife. The Husband was ordered to pay maintenance retroactive to the Wife to May 1, 2007. In light of the fact that the Wife had already received $112,000, Judge Silbermann did not need to address arrears before that date. In effect, the $112,000 became the $18,000 a month the Wife would have received retroactive to the date she brought her first pendente lite application.

Although the Husband had been late in meeting some of his temporary support payments, and the court finds some of the Husband's reasons for late payment without basis, as of the trial maintenance payments were up-to-date. At this time the court sees no basis to require security for the payment of the maintenance award going forward.

The Husband's application for credit for his claimed overpayment of pendente lite support is denied. Some of the Wife's expenses during the pendency of this action went to maintain joint assets (e.g., the Studio Apartment). Although the Husband complains that this asset should have been sold, the court notes that the Wife cooperated in the sale of the Marital Apartment which might not have been ordered to be sold pendente lite. As this action proceeded, the parties' daughter resided in the Studio Apartment. The Husband complained that he should not have had to bear the daughter's rental costs. However, the Husband conceded during trial that he also paid certain of the adult children's expenses. The court finds no purpose would be served in trying to parse the various expenses paid by the Wife and concludes that the award of pendente lite maintenance was appropriate. Moreover, the award of maintenance by this decision reduces the Husband's ongoing obligation.

The Wife's application for necessaries is denied. The court finds no evidence that the Wife owes money because she did not receive support. Even if she had to use savings to meet her expenses pending payments made by the Husband, he ultimately paid the support owed. As the Wife concedes, certain of her expenses were for the daughter's support for which an award of necessaries would be unwarranted. Moreover, certain of the Wife's expenditures, in particular the charges on her credit card, would not fall within the realm of "necessaries." The court is satisfied that the pendente lite award covered her costs and an award of necessaries is unwarranted. The court, therefore, need not consider the Husband's procedural arguments.

Attorney Fees

The Wife seeks attorney fees in the total amount of $582,084 and expert fees in the total amount of $266,804.04

The decision to award counsel and expert fees is left to the sound discretion of the court. Indigence is not a requirement. DeCabrera v. DeCabrera-Rosete, 70 NY2d 879 (1987). "The issue of such is controlled by the equities and circumstances of each particular case and the Court must consider the relative merits of the parties and their respective financial positions in determining whether an award is appropriate. (citations omitted)" Hackett v.Hackett, 147 AD2d 611 (2d Dept. 1989).

*23

The Wife seeks counsel fees for the representation she received from two different firms in this action. The Wife initially retained Steven J. Wohl of Stern Kaiser Panken & Wohl in December 2004. That firm continued to represent her until September 21, 2009, serving as co-counsel after the Wife retained Anthony J. Daniele on May 23, 2007 as litigation counsel. Mr. Wohl, in his affirmation, states Mr. Daniele consulted with him regarding negotiations, strategy and discovery. Mr. Wohl also met with the Wife periodically to discuss how the case was proceeding. The papers give no explanation as to why two firms were necessary to represent the Wife. The Wife paid Mr. Wohl in full. The court finds that the Wife is free to retain any number of attorneys, but no basis exists to require the Husband to pay for her desire to consult with multiple attorneys. The court awards no fees towards Mr. Wohl's costs.

Mr. Daniele claims the Wife was billed $529,141.13 by his firm. In his affirmation, he details the significant amount of motion practice and pre-trial efforts expended by counsel. From a review of his papers and those submitted by the Husband's counsel, the court cannot conclude, as the Wife suggests, that the Husband, any more than the Wife, caused this litigation to become unduly excessive.

Mr. Daniele acknowledges that the Wife has paid him $477,631.32 and that the Wife always paid her bills promptly. The Husband contends, and the evidence supports his position, that as part of her pre-litigation strategy, the Wife deposited marital funds into her own account. The court concludes that she used these funds to pay her attorneys and thus had the benefit of marital funds to pursue this litigation.

The court recognizes that as a result of his separate property interests, the Husband will have more assets than the Wife when this case is over. However, the court has awarded the Wife some separate property claims and a significant maintenance award. The marital property has largely been divided equally.

Taking all of these facts into account, the court awards $50,000 as attorney fees to be paid by the Husband to Mr. Daniele within 90 days of this decision and order.

*24

The Wife also seeks an award of $109,858.50 for the services provided by HHR, the accounting firm that conducted the evaluation pertaining to the alleged $13.4 million of business profits the Husband hid overseas. The Husband argues that the Wife aggressively pursued this claim even though she knew the claim could not be proven. Notwithstanding the Wife's control of the office and the records of the Husband's business, and her litigation planning since 2004, surprisingly few records existed for an evaluation to be done. She testified to making efforts to locate accounts overseas, but found none. Prior to retaining HHR, she retained another forensic accountant to review the existing records and then discharged him. The report prepared by HHR, concededly not a valuation, at most concluded, from a review of very limited documents, that as much as $13.4 million in gross profits were unaccounted for. The Report did not suggest that this money still existed. Inadequate consideration was given to certain costs of doing business or the parties' use of the business profits. The Wife refused to abandon her position that these funds existed even when it became evident during trial that she could not prove her position. The court finds she is solely responsible for these expert fees.

The Wife also seeks an award of $156,945.58 for the services provided by Eisner LLP for its valuation of the Husband's Bambu shares and the appreciation in value of those shares. In three separate applications before the three different judges who presided over the case, the Wife sought a neutral expert to value the Husband's Bambu interest. Each time her application was denied. The evidence available to the court strongly suggested that the Husband's interest in Bambu was his separate property (See, Ex. 71, p. 5). Although this court has awarded to the Wife a small percentage of the Bambu shares, the cost incurred by the Wife to investigate this issue are excessive. The court awards to the Wife $15,000 towards the cost she incurred.

Accordingly, it is hereby

ORDERED, that the parties shall sell and each receive 50 percent of the net profit from the sale of the Studio Apartment and the lot located at 297 Van Brundt Street, Brooklyn, NY. The process of selling these assets shall begin forthwith; and it is further

ORDERED, that Defendant shall receive a $25,000 credit as his portion of the $50,000 Plaintiff withheld from the sale of the Marital Residence; and it is further

ORDERED, that Defendant shall retain possession of the motorcycle collection; and it is further

ORDERED, that Plaintiff shall receive $447,279.25 and Defendant shall receive $135,659.75 of the Citibank Annuities. Each party shall receive a proportionate share of any accrued interest. Plaintiff's portion of this asset reflects her 50 percent distribution plus $268,882 representing her separate property inheritance and $42,737.50 representing her portion of the value of the motorcycle collection after crediting the Defendant $25,000 derived from the sale of the Marital Residence. The parties shall cooperate in completing any paperwork necessary to effect this distribution; and it is further

ORDERED, that each party shall receive $577,885.50, plus an equal distribution of any accrued interest, derived from the following accounts: Citibank…6218; Citibank…0723; Citibank…8727; Citibank Betlar…0693; Plaintiff's Citibank…7702; Plaintiff's Citibank Savings…1117. The parties shall cooperate to complete any paperwork necessary to effect this distribution; and it is further

ORDERED, that Defendant shall cause to be transferred to the Plaintiff a 1.3205 percent interest in Bambu. Defendant shall cause appropriate documentation to be issued to the Plaintiff to record her interest in this asset and to ensure her receipt of distributions made by Bambu; and it is further

ORDERED, that each party shall receive 682.5 shares of their MetLife stock. The parties shall cooperate in completing the necessary paperwork to effect this distribution; and it is further

ORDERED, that the cash value of the following life insurance policies shall be distributed 50 percent to each party: Met Life…060A and Met Life…055A. From this distribution each party shall receive $157,140 plus any accrued cash value to be distributed 50 percent to each party. A third life insurance policy, New York Life…643, with a cash value of $237,858 and a death

*25

benefit of $953,306, shall be maintained by the Defendant to protect the award of maintenance. DRL §236B (8) (a). The Plaintiff shall be named the beneficiary. When the Defendant reaches the age of 75 he shall have the right to cash in this policy or change the beneficiary. If he does so, Defendant shall then pay the Plaintiff $168,929 representing 50 percent of the cash value of the policy at the time of trial. If Defendant elects to maintain the policy for the benefit of Plaintiff, he will not owe her this cash value. In the alternative, the parties can agree to redeem this policy immediately and each receive 50 percent of its cash value. If the parties reach this agreement, no insurance will be required to protect the maintenance award. The parties shall cooperate to complete any necessary documents to effectuate this Order provision; and it is further

ORDERED, that the Plaintiff shall receive 100 percent of the following retirement accounts: Wells Fargo IRA…2377 and Citibank ITE Profit Sharing Plan for a total value of $32,906. The parties shall cooperate to effectuate a transfer of these assets; and it is further

ORDERED, that Defendant shall retain possession and sole ownership of the marital property automobiles; and it is further

ORDERED, that the jewelry held in the safe deposit box shall be sold and each party shall receive 50 percent of the proceeds. The jewelry will be sold by an agreed upon agent within 90 days of this decision and order; and it is further

ORDERED, that the following assets are the Defendant's separate property: the 7.194 percent interest in Bambu he received in 1991; the 8.011 percent interest in Bambu he received in 2005; 100 percent of the funds in his HSBC…752-8 and HSBC…442-5 accounts; 100 percent of his interest in Rockridge Holdings LLP; the $12,000 security deposit for his present renal apartment; and it is further

ORDERED, that the Defendant is 100 percent liable for the Daniel Akerib loan in the amount of $200,000; and it is further

ORDERED, that Defendant shall pay to Plaintiff $14,000 a month in maintenance, taxable to the Plaintiff and deductible to Defendant, effective from September 1, 2010 until August 31, 2015. Effective September 1, 2015, and until August 31, 2018, Defendant shall pay to Plaintiff maintenance in the amount $10,000 a month, taxable to the Plaintiff, deductible to Defendant. Effective September 1, 2018 Defendant shall pay permanent maintenance of $5,000 a month, taxable to the Wife, deductible to the Husband. This award shall terminate in accordance with the provisions of DRL §236 (B) (6) (c); and it is further

ORDERED, that Defendant shall pay to Plaintiff's counsel Anthony Daniele $50,000 as attorney fees on behalf of Plaintiff, said fees to be paid within 90 days of this Decision and Order without further notice; and it is further

ORDERED, that Defendant shall pay to Plaintiff $15,000 for the fees she incurred in retaining Eisner LLP, said fees to be paid within 90 days of this Decision and Order; and it is further

*26

ORDERED, that any relief requested that is not specifically granted has been considered by the court and is hereby denied.

This opinion constitutes the decision and order of the court.

1. These expenses were paid primarily through money earned from the Husband's business. The parties did not receive salary from Bambu until 1997 and it wasn't until after the Husband's business largely ceased operations that he received substantial distributions from Bambu.

2. The Wife's own expert noted: "Legal and professional fees as reflected in Bambu's tax returns for the period 2003 through 2008 have stabilized and have not exceeded $60,000 in any year during such period indicating that legal matters from the former S. entities that hampered Bambu's operating profits in earlier years have diminished." (Ex. 93, Main Report, p. 11).

3. The court finds that the Husband provided insufficient evidence to establish that these shares are held in trust. No trust documents were proffered. Thus, there is no impediment to the distribution of the shares.

4. Although found by this court to be marital property, the expert's valuation of the Cutuli shares was problematic. In determining the original acquisition price of the stock, the accountant failed to consider contemporary transactions of sale of Bambu stock, including the stock sold by Mr. Cutuli, David Fund (Bambu's lawyer) and a court-determined valuation arising from litigation in 1995. The expert placed a value on the stock received by the Husband from the Cutuli purchase at $1.1 million whereas all three of the actual transactions around that times had values of $1.8 to $1.9 million. The difference in these numbers would significantly affect the valuation.

Continue reading "Recent Case Regarding Equitable Distribution and Maintenance" »

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August 17, 2010

LA Dodgers Dealing with Divorce

Posted By Brian Perskin

High net worth divorces can be especially messy. For Frank and Jamie McCourt, many wait to see what detriment their divorce will have on their baby of six years, The Los Angeles Dodgers.

The McCourts were teenage lovebirds, married for thirty years; they flourished as partners in real estate and purchased the Dodgers together in 2004. Nevertheless, the marriage dissolved in 2008. In the midst of this bitter divorce, an outstanding question awaiting resolution is whether the Dodgers will go with Mommy McCourt or with Daddy.

The McCourt divorce demonstrates, on a larger scale and from a more public sphere, what occurs in any family dealing with divorce and the difficulties that may arise with equitable distribution. The fate of the ownership of the team now rests in the hands of the Court system.

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July 16, 2010

Getting a Divorce on your iPhone?

Posted By Brian Perskin

Technology makes advances in the matrimonial field as divorce and the iPhone tie the knot. A divorce lawyer and an app developer team collaborated to create two new iPhone applications, Cost & Prep and Estate Divider, to help those who are thinking about or who are already in the process of divorce. The Cost & Prep application allows divorcees to calculate the costs of divorce while the Estate Divider categorizes assets and liabilities and then suggests how best to divide them.

These divorce apps can transform an iPhone into a personal digital divorce attorney. Though these virtual iPhone applications can be viewed as a threat to real divorce lawyers, it was not created with the intent of being competition. The iPhone applications are just helpful tools for those preparing for a divorce or those who want to simplify and speed up the time-consuming aspects of the process. In fact, even lawyers are taking advantage of these new apps. Lawyers can use the Cost & Prep application, for example, as a quick and easy way of determining how much a client should owe.

Informative and innovative, divorce apps on the iPhone have the potential to do wonders for both divorce attorneys and clients alike. Coming soon from DivorceApps.com are the Estate Divider Template, Child Possession Calendar, and Child Support Calculator.

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July 08, 2010

Judge Rejects Divorce Based on Insufficient Grounds: How New No-Fault Divorce Bill Would Have Made a Difference

Posted By Brian Perskin

A Nassau Supreme Court Justice rejected a man's petition for divorce on the grounds of abandonment. The husband claimed that his wife refused to have sex with him for almost 12 years. Meanwhile, the wife's testimony undermined and counteracted her husband's. She refuted her spouse's claims, stating that she was actually going to resume sexual relations with him despite his current residence with another woman, whom he had dated during their marriage. The wife brings further conflicting evidence to the table as she describes their usual infrequency of sexual relations due to the husband's bad liver. Because the wife's statements were equally as credible as her husband's, the judge had no choice but to dismiss the action on the basis of "the [wife's] conflicting testimony and the husband's failure to establish fault."

This case reveals the problem with requiring grounds for divorce. In this case, the husband attempted to prove abandonment. He was unsuccessful because it is difficult to find evidence for and to prove beyond a doubt that the wife refused him sex. The sexual relationship between a husband and a wife is a private matter, in which a witness would be almost impossible to find. In the end, it is "one spouse's words against another's."

This sparks interest in light of the recent passing of the no-fault divorce bill in New York. This revolutionary bill permits divorce after a marriage has been deemed "irretrievably broken down for at least six months or more." This bill eliminates the need to identify a fault, such as abandonment. In accordance with this new bill, the aforementioned case would have been simply settled by stating that the relationship was beyond repair; the marriage would have been dissolved without putting either spouse at fault.

To view the case, see below:

SUPREME COURT OF THE STATE OF NEW YORK

COUNTY OF NASSAU

Before this court is a grounds trial which was conducted on April 21, 2010. The verifiecomplaint consist of one cause of action, Constructive Abandonment.

Plaintiff, J.S., and defendant, D.S., were married in a civil ceremony on November 21, 1989. This action was commenced on November 9, 2009. Plaintiff has been a resident of the State of New York for a continuous period of two years immediately prior to the commencement of this action. At the time of the marriage, both parties were over the age of 18. No judgments of divorce, separation or annulment have been granted to either party in this state or any other jurisdiction. There is one emancipated child of this marriage, whose date of birth is May 8, 1979, who resides in Atlanta, GA and no other children are expected. The marriage between the parties was not solemnized by a person specified in Domestic Relations Law §11(1). There is no other action or proceeding for a divorce or other dissolution of the said marriage of the parties pending in this or any other jurisdiction.

The verified complaint alleges that the parties have not sexually cohabited with each other as husband and wife for a period commencing on September 1, 1998 and continuing through the present time and during the said period of time the defendant has not so sexually cohabited or engaged in sexual relations with the plaintiff as husband and wife despite the plaintiff's willingness and despite his repeated requests to do so. That the defendant's refusal to so sexually cohabit with the plaintiff and engage in sexual relations with the plaintiff was not caused or provoked by any conduct on the part of the plaintiff and said conduct of the defendant was without the plaintiff's consent. Upon information and belief, the defendant has not suffered from any mental or physical disability that would prevent or inhibit the defendant from so sexually cohabiting and engaging in sexual relations with the plaintiff. By reason of the foregoing, the said conduct on the part of the defendant constitutes a constructive abandonment of the plaintiff.

Plaintiff testified that his current address is X, NY and that the defendant resides at the marital residence located at X, NY, that the parties resided at that residence for 13 years from 1988 until 2001. Plaintiff testified that all information in the verified complaint was true to the best of his knowledge and that the allegations were still true as of the date of this grounds trial. Plaintiff testified that he is presently married to defendant and that their date of marriage was on November 21, 1989 and the marriage was performed in Queens Court, he has one child with defendant, her date of birth is May 8, 1979 and she is 31 years of age and self supporting. Defendant still resides at X, NY.

Plaintiff testified that he and the defendant enjoyed a satisfactory sexual relationship from 1988 through 1998. Plaintiff also testified that they stopped having sexual relations on or about September 1, 1998 when the relationship deteriorated. Plaintiff testified that he would initiate sexual relations on occasion after taking defendant out to dinner, drinking or being out with friends. Plaintiff stated that defendant infrequently initiated sexual relations. Plaintiff testified that there was never a time that he refused defendant sexual relations. Plaintiff testified that defendant refused him sexual relations for no valid reason. Plaintiff testified that even after defendant refused to have sexual relations, that he tried to have conversations with defendant regarding same. Plaintiff and defendant belong to Jehovah Witness and plaintiff sort the advise of the Elders as to how to handle the deterioration of his marriage.

Plaintiff removed himself from the marital residence on or about June or July 2001. Plaintiff testified that the defendant's mental and physical health appeared normal and that there was no cause not to have sexual relations. Plaintiff testified that he made several attempts on various occasion to have sexual relations with defendant. He would take her to dinner, bring her flowers, take her out for drinks with friends, go away to the Pocono's with friends from their Jehovah Witness fellowship, but defendant still refused to have sexual relations with plaintiff.

Upon cross examination of the plaintiff, he first stated that he stopped having sexual relations with the defendant in 2000 then changed it to 1998, however, he left in June or July of 2001. Plaintiff was questioned as to his 2008 Federal Income Tax return wherein he has his current girlfriend listed as a dependant/sister. Defendant's counsel questioned plaintiff as to his health and defendant's health and stated that in his prior testimony, he stated that they were both in good health. Defendant's counsel did point out that defendant, does in fact, have hepatitis B which is a communicable disease and could be spread through sexual relations, to which plaintiff agreed. Plaintiff was questioned as to who X is and he stated that she is his girlfriend of the past 9 or 10 years and that he currently resides with her. When asked why plaintiff's 2008 Federal Tax Return lists Ms. X as an exemption and as the plaintiff's sister, plaintiff stated that it must be a mistake.

Defendant testified on direct examination that she was present during plaintiff's testimony and based upon her knowledge, the plaintiff's testimony was not true. Defendant testified that she never denied plaintiff sexual relations and that on several occasion when she initiated sexual relations, plaintiff refused. Defendant testified that they had an active sexual relationship up until when the plaintiff left the marital residence which was in June 2001. Defendant further testified that on one occasion, after sexual relations, plaintiff fell asleep and defendant looked at his cell phone which was unlocked and she called the phone number for X. Defendant and Ms. X had a long conversation and when plaintiff awoke, defendant presented plaintiff with his telephone. When plaintiff realized that the defendant and Ms. X had conversed, it was at that time that plaintiff left the marital residence.

Defendant acknowledged that the sexual relationship was infrequent, however, she stated that plaintiff was not that physical of a person and that she was okay with the

infrequent sex as plaintiff's liver is not in good shape as a result of the hepatitis B.

Defendant stated that she never refused to have sexual relations with defendant and that she was always willing to resume her sexual relationship with the defendant and does not want to pursue a divorce.

After plaintiff admitted to his relationship with Ms. X, defendant went to her doctor

and was told that she had a vaginal infection. As plaintiff and defendant had a doctor in

common, the doctor advised defendant that she should receive an injection because of her husband's hepatitis B. Defendant refused the injection due to plaintiff removing himself from the marital residence. Defendant states that she did not request plaintiff leave. Defendant stated that she has been lied to before and that her heart is not in this divorce. She forgives her husband and has always been willing to have and resume sexual relations with defendant.

Constructive Abandonment

"It is well settled that to establish a cause of action for a divorce on the ground of constructive abandonment, the spouse who claims to have been constructively abandoned must prove that the abandoning spouse unjustifiably refused to fulfill the basis obligations arising from the marriage contract and that the abandonment continued for at least one year" (Lyons v. Lyons, 187 A.D.2d 415, 416, 589 N.Y.S.2d 557 (2nd Dept. 1992); see also, George M. v. Mary Ann M., 171 A.D.2d 651, 651-652, 567 N.Y.S.2d 132 (2d Dept. 1991); Caprise v. Caprise, 143 A.D.2d 968, 970, 533 N.Y.S.2d 622 (2nd Dept. 1988). In order to rise to the level of constructive abandonment, the refusal must be "unjustified, willful, and continued, despite repeated requests from the other spouse for resumption of cohabitation'" (Caprise v. Caprise, supra, at 970, 533 N.Y.S.2d 622 quoting Scheinkman, Practice Commentaries, McKinney Cons. Laws of N.Y. Book 14, Domestic Relations Law C170:7, at 608 [emphasis in original]). Where there is no proof that one spouse repeatedly requested a resumption of sexual relations, evidence that the other spouse refused a single request to engage in sexual relations is insufficient to sustain a cause of action for divorce on the grounds of constructive abandonment (see, Caprise v. Caprise, supra, Silver v. Silver, 253 A.D.2d 756, 677 N.Y.S.2d 593 (2nd Dept. 1998). Evidence that a party refused sexual relations for the required period and that the refusal was willful, continued, and unjustified would be sufficient (see Gulati v. Gulati, 50 A.D.3d 1095, 857 N.Y.S.2d 643 (2nd Dept. 2008); Ostriker v. Ostriker, 203, A.D.2d 343, 344-45, 609 N.U.S.2d 922, (2nd Dept. 1994); Gunn v. Gunn, 143 A.D.2d 393, 532 N.Y.s.2d 556 (2nd Dept. 1998); Benarroch v. Benarroch, 55 A.D.2d 943, 391 N.Y.S.2d 138 (2nd Dept. 1977).

The party seeking the divorce has the burden of demonstrating marital misconduct. See, Salomon v. Salomon, 102 Misc.2d 427, 423 N.Y.S.2d 605 (Sup. Ct. Suffolk Co. 1979) (generally); and Wolfson v. Wolfson, 39 A.D.2d 724, 331 N.Y.S.2d 844 (2nd Dept.).app. dism., 31 N.Y.S.2d 671, 336 N.Y.S.2d 907, 288 N.E.2d 808 (1972) (with regard to abandonment). Entitlement to a divorce for construction abandonment must be based upon a showing in part, that the refusal to engage in marital relations is unjustified, willful and continuous. Diemer v. Diemer, 8 N.Y.2d 206, 203 N.Y.S.2d 829, 168 N.E.2d 654 (1960). See, also, Chase v. Chase, 208 A.D.2d 883, 618 N.Y.S.2d 94 (2nd Dept. 1994); and Lyons v. Lyons, 187 A.D.2d 415, 416, 589 N.Y.S.2d 557 (2nd Dept. 1992).

To determine whether a witness is telling the truth is sometimes a difficult issue for the Court to decide. In the instant action, both the plaintiff and the defendant seemed credible. Their demeanor and testimony seemed truthful, but since they both testified to a different set of facts regarding the same events only one can be telling the truth.

In a similar case, (Sullivan v. Sullivan, 180 Misc.2d 433, 440, 689 N.Y.S.2d 378, 383 (Sup. Ct. Suffolk Co. 1999)), the Judge eloquently described this type of testimony as follows: "Only two witnesses testified on the trial of this matter: the parties. On the one hand, plaintiff testified that he requested and was rebuffed. On the other, defendant testified to an active sexual relationship until ... [the defendant moved out.] On balance, these competing versions of the relationship of the parties, in and of itself, is a wash. Put another way, plaintiff has not established a fair preponderance of the credible evidence that there was a constructive abandonment here. Where there is an even balance of evidence, the Court is required to find for defendant. See, Rinaldi & Sons, Inc. v. Wells Fargo Alarm Service, Inc., 39 N.Y.2d 191, 383 N.Y.S.2d 256, 347 N.E.2d 618 (1976)."

As a result of the foregoing and adopting the controlling case law cited above, this Court finds that the plaintiff simply has not met his burden of proof to establish grounds for a divorce pursuant to DRL §170(2).

The only two (2) witnesses that testified were the parties herein. The plaintiff testified he requested to have sexual relations with the defendant and was refused. The defendant testified she enjoyed having sexual relations with the plaintiff and did not refuse and was still willing to have sexual relations.

For the foregoing reasons, the action is dismissed.

This constitutes the decision and Order of the Court.

Dated: May 24, 2010

Mineola, New York

Continue reading "Judge Rejects Divorce Based on Insufficient Grounds: How New No-Fault Divorce Bill Would Have Made a Difference" »

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June 17, 2010

No Fault Divorce is Moving Forward

Posted By Brian D. Perskin

New York State has moved closer to enacting the no fault divorce law by overcoming the hurdle of passing in the Senate. The law would allow couples to be granted divorce without having to prove grounds like adultery or cruel and inhuman treatment.

William Glaberson of The New York Times writes:

For decades, New York State's divorce system has been built on a foundation of winks and falsehoods. If you wanted to split quickly, you and your spouse had to give one of the limited number of allowable reasons - including adultery, cruelty, imprisonment or abandonment - so there was a tendency to pick one out of a hat.

"What the fault divorce system has done is that it has institutionalized perjury," said Malcolm S. Taub, a veteran Manhattan matrimonial lawyer. "This play-acting goes on and everybody looks the other way and follows the script."

On Tuesday, the State Senate approved a bill that would permit divorce without a claim that either side is at fault, and on Wednesday the State Assembly Speaker, Sheldon Silver, said his members were discussing the details of similar legislation. "I support the concept," Mr. Silver said.

For judges, New York's requirement of fault when the rest of the country has abandoned that requirement creates a series of problems. One of them is the need to listen to private information some of them feel is none of their business.

Acting State Supreme Court Justice Jeffrey S. Sunshine, the supervising matrimonial judge in Brooklyn, said it seemed somewhat 19th century to have people testifying about "constructive abandonment," the legal term for rebuffing intimacy for a year or more.

"Should we really," Justice Sunshine asked, "in the 21st century be having people get on the stand and testify that 'my spouse refused to have sex with me'?"

Aside from the intrusion, Justice Sunshine added, it is not a subject that lends itself to an easy decision, since there are often no witnesses to what goes on in private. "Some of the claims may be dubious," he said.

If the truth gets a workout in cases where both sides want to part, it can be wrenched completely out of shape in contested divorces. The facts can be leverage, lawyers say, and denying them can be used to stop a divorce case in its tracks.

Several divorce lawyers said there are multimillionaires in New York who have not been faithful but who are keeping their spouses in loveless pairings so as to avoid a division of wealth. They simply deny adultery.

Court battles over fault are destructive, said Norman S. Heller, the head of the matrimonial practice at the law firm Blank Rome. "It's ugly," he said. "It's expensive. It poisons the relationship."

New York law has long allowed people who agree to a divorce to get one if they both sign a separation agreement and live apart for a year. A new provision could do away with the need for the agreement.

The senate package passed 32-29 and also includes a measure that sets post-marital income guidelines for maintenance awards. It also contains a bill that creates a "rebuttable presumption" that a partner with disproportionately greater financial means should pay the legal costs of his or her spouse. The package now awaits Assembly approval.

It is important to hire a lawyer who stays up to date on the latest developments in the law. For further information about The Law Offices of Brian D. Perskin please click here.

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June 11, 2010

Mother Jailed for Interfering with Father's Visitation Rights

Posted By Brian Perskin

An unexpected twist occurred in the shared custody of two children as a Supreme Court Justice in Nassau County sentenced the mother, the Plaintiff, to spend six weekends in jail for her frequent attempts to estrange her ex-husband, the defendant, from their daughters. She blatantly undermined the Court order that decided the father's visitation rights. The Plaintiff created obstacles that hindered the father from seeing his daughters during scheduled visits. Due to her efforts, she was able to keep the father from his children for six weeks during the winter of 2007. The Plaintiff even went so far as to accuse the father of sexually abusing the children; no evidence was found to support such allegations. Nevertheless, the Court found the evidence of the Plaintiff's interference with the father's visitation rights and her mindful violation of the couple's stipulation of settlement to be overwhelming. Consequently, the Long Island judge ordered the Plaintiff to spend every other weekend this summer at Nassau County Correctional Facility.

The judge's ruling on this case is an example for other spouses who are going through a divorce, in which there are children involved. By trying to manipulate the relationship between her ex-husband and the children, the mother did not have "the children's best interests at heart." She did her best to pry her daughters away from their father; the mother, thus, unnecessarily exposed her children to and entangled them within her messy relationship with the ex-husband. Couples who have strained relations must remember to be conscious of how their behavior with their spouse or ex-spouse can affect their children.

To view the case see below:

NASSAU COUNTY
Family Law

Decided: May 25; 203699-02

The continuing jurisdiction of the Supreme Court to modify or annul its custody and visitation judgments and orders, is set forth in Domestic Relations Law §240. Such authority is similarly provided to the Family Court pursuant to Family Court Act §467. In post judgment proceedings regarding a modification of custody and visitation, the standard is the "best interest of the child," when all of the applicable factors are considered. See, Friederwitzer v. Friederwitzer, 55 NY2d 89.

Parental access, commonly referred to as "visitation," is an important right of the non-custodial parent and the child. See, Weiss v. Weiss, 52 NY2d 170. In a scenario where one parent is demonstrated to have interfered with the custodial rights of a parent, a number of mechanisms exist [see, Scheinkman, New York Law of Domestic Relations, Second Edition, §23.14] to aid in the enforcement of custody orders and judgments, including:

1. Criminal Sanctions, pursuant to Penal Law §135.45 and 135.50;

2. Suspension of alimony or maintenance, pursuant to Judiciary Law 750,753;

3. Tort action for custodial interference;

4. Orders of Protection, pursuant to Domestic Relations Law §240.

While the most factually apparent ground to change existing custody arrangements involves physical danger, the act of alienating a child against a parent presents a nefarious form of conduct that must be met with careful consideration and immediate, comprehensive remediation by a Court (see, Zafran v. Zafran, 306 AD2d 468; Lew v. Sobel, 46 AD3d 893). A change in custody should not be permitted solely as a means for punishing a recalcitrant parent (see, Lew v. Sobel, supra), but always requires due consideration of all of the other custodial factors. See, Robert T.F. v. Rosemary F., 148 AD2d 449.

While mindful of the consequential future effect of this determination (see, Lauer v. City of New York, 95 NY2d 95, 100), inasmuch as a Court's finding of willful interference "per se raises a strong probability that the custodial parent is unfit" (see, Young v. Young, supra; Glenn v. Glenn, supra), when a pattern of alienation by the custodial parent is proven in any prior proceeding, that alienating conduct must [emphasis added] be considered and addressed by the Court in any subsequent proceeding involving custody/parental access. See, Audobon v. Audobon, 138 AD2d 658; Martin R.G. v. Ofelio G.O., 24 AD3d 305. Also, see CPLR §4213[b]; Robert T.F. v. Rosemarie F., 148 AD2d 449.

The doctrine of res judicata bars the issue of whether alienation occurred in the subsequent change of custody hearing ordered herein. See, O' bdoherty@chat.nyc.amlaw.corp Brian v. City of Syracuse, 54 NY2d 353, 357; Matter of Waldman v. Waldman, 47 AD3d 638; Braunstein v. Braunstein, 114 AD2d 46, 53; Town of New Windsor v. New Windsor Volunteer Ambulance Corps, Inc., 16 AD3d 403. Considering that parental alienation of a child from the other parent has been determined to be "an act inconsistent with the best interest of the child (Bobinson v. Bobinson, 9 AD3d 441; Stern v. Stern, 304 AD2d 649; Zafran v. Zafran, 28 AD3d 753; Zeis v. Slater, 57 AD3d 793), and that it has been proven in this contempt proceeding - - the "strong likelihood of unfitness" becomes a "factor" that must be considered in the change of custody hearing ordered herein.

Protraction or delay in parental alienation cases often serve to reinforce the offending conduct and potentially undermine any remediation that a court could fashion with appropriate therapy, parent coordination, and/or, a change in custody. See, Steinberger, Father? What Father? Parental Alienation And Its Effect on Children, NYSBA Family Law Review, Spring 2006; Johnston, J.R., Children of Divorce Who Reject a Parent And Refuse Visitation: Recent Research & Social Policy Implications for the Alienated Child, 38 Fam. L.Q. 757, 768-769. Under the circumstances of this case, this Court's finding of a willful violation of an existing order of custody in the form of parental alienation requires a prompt evidentiary hearing to determine whether the children's best interests, under the totality of the circumstances, warrant modification of the previously entered custody order. See, Friederwitzer v. Friederwitzer, 55 NY2d 89; Corigliano v. Corigliano, 297 AD2d 328; Martin R.G. v. Ofelio G.O., 24 AD3d 305; Carlin v. Carlin, 52 AD3d 559.

PROCEDURAL HISTORY

By Order to Show Cause dated December 14, 2007, defendant sought an order to have the plaintiff held in contempt for her willful and deliberate failure to comply with the Stipulation of Settlement, dated October 30, 2003, in that she allegedly interfered with his right to frequent and regular visitation with and telephone access to the parties' children, D. and N.; and by alienating the children from the defendant through numerous acts of disparaging the defendant to the children. The Court granted defendant's motion by its Amended Decision and Order dated September 9, 2008, to the extent that a hearing was ordered. This contempt hearing was held before me on May 15, 21, July 13, 15, 16, August 3, 4, 5, 6, 17, 18, 19, September 17, 2009, January 4, 5, 6, 7, 8, 11, 12, 19, February 3, and 22, 2010.

The parties' Stipulation of Settlement was incorporated but not merged into the parties' Judgment of Divorce (Stack, J.). Pursuant to the unequivocal terms of the Stipulation, she was prohibited from "alienating the children from the defendant, plac[ing] any obstacle in the way of the maintenance, love and affection of the children for the defendant," or to "hinder, impair or prevent the growth of a close relationship between the children and their parents, respectively, or cause others to do so." Moreover, in sharing joint legal custody of the children, she was specifically required to consult with the defendant regarding decisions affecting the children's education, health and religion. That Stipulation also clearly provided that each of the parties was to "exert every effort to maintain free access and unhampered contact," "to foster a feeling of affection," and not to "do anything which may estrange the children from [the defendant] or injure the children's opinion as to the Father which may hamper the free and natural development of the children's love and affection for the [Defendant]."

To sustain the defendant's application regarding contempt, he must demonstrate that the plaintiff has violated a clear and unequivocal court order which actually defeated, impaired, impeded or prejudiced the other party's rights (see, Great Neck v. Central, 65 AD2d 616) or were calculated to affect those rights (Stempler v. Stempler, 200 AD2d 733). The movant must meet this burden by clear and convincing evidence (Bulow v. Bulow, 121 AD2d 423). The Court may not hold a party in contempt where payment may be enforced by other enforcement procedures (Wiggins v. Wiggins, 121 Ad2d 534), unless such remedies would be an exercise in futility or ineffectual (Farkas v. Farkas, 209 AD2d 316). Upon a finding of contempt, the Court may impose a period of commitment to jail (Powers v. Powers, 86 NY2d 63) or fine, or both.

In this instance, a lawful court order, in the form of a Judgment of Divorce incorporating the parties' stipulation of settlement, was in effect. The plaintiff was shown to have actual knowledge of its terms. Ottomanelli v. Ottomanelli, 17 AD3d 647; Freihofner v. Freihofner, 39 AD3d 465; Kawar v. Kawar, 231 AD2d 681, 682. This order of parental access was not only in effect before and during the hearing, but unsuccessful efforts were made during the course of the hearing to utilize counseling and parenting coordination to remediate the alienating conduct of the plaintiff. See, Lew v. Sobel, 46 AD3d 893. See, also, Judiciary Law §753; Massimi v. Massimi, 56 AD3d 624.

CONTEMPT

The Court's findings here were based, in part, upon an assessment of the credibility of the witnesses and their character, temperament and sincerity. Matter of Carl J.B. v. Dorothy T., 186 AD2d 736; see, also, Klat v. Klat, 176 AD2d 922; Leistner v. Leistner, 137 AD2d 499. I have also considered the extensive post-hearing submissions of each of the parties and the attorney for the children.

Here, the defendant's burden of proof in this matter was met so overwhelmingly, as to exceed the burden of proof required (see, Bulow, supra). Instead, it was proven "beyond a reasonable doubt" [cf., Rubackin v. Rubackin, 62 AD3d 11]. The acts perpetrated by the plaintiff were not only in willful violation of the Stipulation of Settlement, as incorporated into the Judgment of Divorce, but such as to demonstrate a continuing and calculated effort to violate the parental access of the defendant to the infant issue. The movant here demonstrated that the plaintiff violated a clear and unequivocal Court order, thereby prejudicing his rights. See, Judiciary Law §753[A][3]; Vujovic v. Vujovic, 16 AD3d 490. The specific findings of fact are detailed herein, and considering the extent, nature, and continuing pattern of alienation perpetrated by the plaintiff, it is clear that plaintiff's conduct was calculated to and did, in fact, impair, impede or prejudice the rights and remedies of the defendant herein. See, Silverman v. Silverman, N.Y.L.J., 11-22-95, p. 26, col. 1; McCain v. Dinkins, 84 NY2d 216; Hoglund v. Hoglund, 234 AD2d 794.

FACTUAL FINDINGS ANDINSTANCES OF ALIENATION

Plaintiff intentionally scheduled their child's (N.'s) birthday party on a Sunday afternoon during defendant's weekend visitation, and then refused to permit defendant to attend. She demanded that N. be returned home early, in order to "prepare" for her party, but D., the other child, was enjoying the time with her father and wished to remain with him until the party began. Plaintiff castigated N. for "daring" to invite her father to take a picture of her outside her party. According to the plaintiff, "this doesn't work for me!" Plaintiff threatened to cancel N.'s party, and warned her that her sister, too, would be punished "big time" for wanting to spend time with her father. Plaintiff's taped temper tantrum, offered into evidence, vividly detailed one instance of how D. and N. have been made to understand that enjoying time with their father will be met with their mother's wrath and threat of punishment.

Plaintiff conceded that when she completed N.'s registration card for XXX., she wrote that defendant is "not authorized to take them. I have custody. Please call me." At trial, she claimed to fear that defendant would retrieve the girls directly from school. However, she later admitted that defendant had never even attempted to pick them up at school. Her testimony at trial sharply contradicted her sworn affidavit dated January 23, 2008, in which she stated that "the defendant consistently attempts to pick up the girls unannounced from their schools and activities, which disrupts not only the girls, but those in charge of the aforementioned." In her sworn affidavit, plaintiff claimed that she completed the registration card because defendant sought to attend the end of D.'s art class and then had the audacity to drive his daughter home. The art class "incident" occurred well after the registration card was completed by the plaintiff. Moreover, nothing in the parties' agreement prohibits the defendant from visiting the children at extra-curricular events or from driving them to or from such events. In point of fact, there was no dispute that D.'s Friday art class in Huntington ended as defendant's alternate weekend visitation commenced.

Plaintiff wrote to Dr. L.¹ (then the XXX. principal) and Ms. T. (N.'s fifth grade teacher), demanding that they restrict their conversations with the defendant to N.'s academics, as plaintiff is "solely responsible for her academic progress and emotional well being. Notwithstanding the nature of their joint legal custody plaintiff insisted before me that, "I have custody, he has visitation."

The plaintiff made/completed an application for admission to XXX on behalf of N. in October, 2007. On the application, she checked the box "Mother has custody," rather than the box directly below which says "Joint custody." She identified her new husband, R. L., as N.'s "parent/guardian," and she failed to mention the defendant. During cross examination, plaintiff insisted that she only omitted reference to the defendant for fear that his financial circumstances would adversely impact N.'s chances for acceptance. However, no financial information was requested anywhere on the application. Moreover, plaintiff acknowledged that none was required until after an applicant was invited to attend.

By applying to XXX without defendant's knowledge - - but with N. completely involved in the process, plaintiff orchestrated the decision to be made, as well as alienating the child. Had the defendant not consented to N.'s attendance at XXX, after the fact, N. would be angry with him for purportedly interfering with the enrollment, even if defendant's objections to a private school placement were sound. In no event was he consulted as to this educational decision.

When asked how she might handle things differently now, plaintiff did not indicate that she would first discuss the possibility of a private school with the defendant, as she is obligated to do pursuant to the Stipulation.

In a similar pattern of being advised "after the fact," defendant testified that there were countless times when plaintiff deliberately scheduled theater tickets, family events and social activities for the girls during his visitation, and he was compelled to consent or risk disappointing the girls. These occurrences continued even during the time span of proceedings before me.

Plaintiff was forced to concede at trial that the defendant was prevented from enjoying his visitation rights after he returned with the girls from his niece's Bat Mitzvah until this Court granted defendant's emergency application to compel the plaintiff to allow the defendant to take D. and N. for the ski trip he had scheduled for his half of the Christmas recess. Plaintiff insisted that it was D. and N. who refused to see their father, because they were angry with the 'choices" he had made on their behalf, including his objection to N. attending XXX. Defendant was made aware of the children's position because they parroted their mother's demands on several occasions. D. even read from a script during the brief dinners he was permitted. As plaintiff wrote in one e-mail when she was describing her role with respect to the children: "I am in charge here, not them. What I [sic] say goes. They may bring their shoes. You are responsible for the rest. End of story."

In vivid testimony, the defendant recalled how the plaintiff willfully prevented him from exercising his rights to visitation with the children from November 4, 2007 through December 21, 2007. I observed the plaintiff smirk in the courtroom as defendant emotionally related how he was deprived of spending Hanukkah with his children, and was relegated to lighting a menorah and watching his daughters open their grandparents' presents in the back of his truck at the base of plaintiff's driveway on a December evening.

The fact that the children were as angry as they were with the defendant in November and December, 2007, demonstrates, in my view, that efforts to alienate the children and their father were seemingly effective. The children demanded that defendant meet "their" demands before they would permit him to visit with them again. They demanded that defendant permit N. to attend F. A., that he withdraw his objection to their participation in therapy with their mother's therapist, and that he pay for 75% of D.'s Bat Mitzvah but limit his invitations to a handful of guests and have no role in the planning of the event. Plaintiff's contention that she had no involvement in these children's "demands" was belied by the very fact that the children had intimate knowledge of their mother's position on all of these issues. The children, in effect, were evolved into plaintiff's sub-agents and negotiators, having specific details of the financial demands of the plaintiff, and information as to the marital agreement.

The mother alluded to the ambivalence of the children in seeing the defendant. But such abrogation to the children's wishes, under these circumstances, was in violation of the agreement. It was wholly improper for the mother to adhere to the children's wishes to forego visitation with their father (see, Matter of Hughes v. Wiegman, 150 AD2d 449).

Plaintiff half-heartedly testified that she wants the children to have a relationship with the defendant. Her view of the defendant's role was a numbing, desired nominality, evident by her actions that were without any semblance of involvement by the defendant - - notwithstanding the clear joint custodial provisions. At critical points in the cross-examination, plaintiff was noticeably off balance - - hesitating and defensive - - with answers that dovetailed to either narcissism, or, a poor grasp of the affects of her conduct. The plaintiff was dispassionate, sullen, and passively resistant to the alienating efforts of the plaintiff. The continued litany of instances of alienating conduct, turned repression of the defendant's joint custodial arrangement into farce. The endurance in recounting instance upon instance of alienating conduct herein, was as daunting as it was indefensible.

Plaintiff relegated the defendant to waiting endlessly at the bottom of her long driveway. When defendant drove up her driveway on October 26, 2007, so that the children would not have to walk down with their heavy bags in a torrential rain, plaintiff ran down the driveway where she had left her car, drove up the driveway and blocked defendant's vehicle. The children watched as the police listened to their mother angrily demand that their father be arrested and, when the police refused, heard their mother scream that she is a taxpayer and the police work for her. She frequently disparaged the defendant in the presence of the children, calling him a "deadbeat," "loser," "scumbag," and "f---g asshole." On one particular occasion, while holding N. and D. in her arms, plaintiff said to the defendant, "We all hope you die from cancer." Just this past summer, when defendant insisted that D. retrieve her clothes from plaintiff's home in preparation for their visit to N. on her camp visiting day, plaintiff urged to defendant that "Judge Ross will not be around forever, d___." Before the beginning of each of defendant's vacations with the children, the plaintiff staged prolonged and tearful farewells at the base of the driveway, during which plaintiff assured the children that they will return to "their family soon," and if "things get too bad, they can always tell Daddy to bring them home."

The crescendo of the plaintiff's conduct involved accusations of sexual abuse. Plaintiff falsely accused defendant of sexual misconduct in June, 2008, shortly after defendant moved to Huntington and the children's friends were enjoying play dates at defendant's home. Plaintiff testified that D. shared that she was uncomfortable when the defendant tickles her, and conceded that she knew there was nothing "sexual" involved. Undaunted by the lack of any genuine concern for D.'s safety, plaintiff pursued a campaign to report the defendant to Child Protective Services. To facilitate this, she spoke with W. M, the psychologist at the school D. attended. Plaintiff also "encouraged" D. to advise Dr. C. (the chidren's pediatrician) that defendant inappropriately touched her - - but he saw no signs of abuse. Plaintiff also advised Dr. A., Ms. M., Dr. R. (the children's prior psychologist) and family friends of the allegations and, ultimately, the Suffolk County Department of Social Services opened a file on June 3, 2008, and began an investigation.

According to the Case Narrative contained in the New York State Case Registry, a complaint was made that "On a regular basis, father inappropriately fondles 13 year old D.'s breasts. This makes D. feel very uncomfortable. Last Sunday, Father hit D. on the breast for unknown reason… " When the caseworker and Suffolk County detectives interviewed D. on June 3, 2008, she reported only that her father tickles her on her neck and under her arms, and she categorically denied her father ever fondled her breasts. She admitted that her father was not attempting to make her uncomfortable, but that he still regards her to be a tomboy. The detectives closed their investigation.

Thereafter, and significantly, when the CPS caseworker met with plaintiff on August 19, 2008, plaintiff was quick to state that her ex-husband "did it again." Plaintiff claimed that the defendant hugged D. too hard. According to the caseworker's notes, the caseworker repeatedly cautioned the plaintiff not to bring the children into her disputes with the defendant. This warning was contained in CPS records.

Although unfounded child abuse reports are required to be sealed (see, Social Services Law §422[5]), such reports may be introduced into evidence,"by the subject of the report where such subject… is a plaintiff or petitioner in a civil action or proceeding alleging the false reporting of child abuse or maltreatment" (Social Services Law §422[5][b][1]). Allegations that defendant had injured the child were found to be baseless and, by making such allegations, plaintiff needlessly subjected the child to an investigation by Child Protective Services, placing her own interests above those of the child. This report was not made in "good faith" - - rather, the investigating agency warned the mother not to re-utilize the allegations and her children in her custodial litigation with the defendant.

The concern of a pending contempt proceeding did not affect the plaintiff's conduct. For example, knowing that defendant had parenting access with D. on July 3, 2009, plaintiff invited D.'s close friend, C. C., to a country club for a fireworks display and advised D. of this invitation. She then instructed D. to tell her father she was invited to a friend's party on that date. Another example occurred on June 13, 2009, when plaintiff quietly escorted D. from Alice Tulley Hall during the intermission, ignoring the instructions from the G. Y. Orchestra staff that everyone remain until the conclusion of the entire program. Plaintiff purported she was unaware that defendant attended this special program in Lincoln Center. Defendant, who was in attendance at the concert, was left waiting at the stage door with flowers for D. Plaintiff ignored his text messages questioning where his daughter was. The plaintiff, when confronted with the notion that she may have precipitously ushered her daughter away before her father was able to give her flowers, retorted to the Court that "it was not her responsibility to make plans for T."

The evidence before me demonstrates a pattern of willful and calculated violations of the clear and express dictates of the parties' Stipulation of Settlement, incorporated but not merged into their Judgment of Divorce. The extensive record is replete with instances of attempts to undermine the relationship between the children and their father and replace him with her new husband, manipulation of defendant's parenting access, utter and unfettered vilification of the defendant to the children, false reporting of sexual misconduct without any semblance of "good faith," and her imposition upon the children to fear her tirades and punishment if they embrace the relationship they want to have with their father. The unfortunate history here also reflects the plaintiff's hiring and firing of three different counsel, expressed disdain towards the children's attorney, and utter disregard for the authority of the Court.

CHANGE OF CUSTODYPROCEEDING TO BE HELD

There was no request in the moving papers for a change of custody. During the course of the extensive hearing held before me, application was made by the defendant for an immediate change of custody. It is improper for a trial court to take action and grant relief without appropriate notice to one of the parties affected. Such notice during the course of the proceeding for undemanded relief does not constitute adequate notice, and could serve to prejudice the plaintiff. Siegel Practice Commentary, McKinney's Consol. Law of New York, Book 7B, CPLR 3017.6. The Court did not grant the relief for a change in custody in the course of the hearing for contempt. However, Domestic Relations Law §240 provides that upon an application, the Court may modify a previous direction with respect to the right of visitation "after such notice to the other party… .and given in such manner as the Court shall direct." See, Domestic Relations Law §240. The request for a change in custody during the course of the contempt hearing clearly has provided adequate notice by which to schedule a hearing. The request during the hearing to amend the motion to conform to the evidence presented at this hearing, is now granted, to the extent of ordering a prompt hearing on a modification of custody. Heintz v. Heintz, 28 AD3d 1154; cf. Sipos v. Kelly, 66 AD2d 1022. See, also, Fisk v. Fisk, 274 AD2d 691.

The parties are to appear before me on June 4, 2010 to be heard on selection of a forensic examiner and to be heard on allocation of fees. See, Uniform Rules §202.7; also see, Ragone v. Ragone, 62 AD3d 772; Domestic Relations Law §237(d)(4). The scheduling of the modification of custody hearing will be facilitated at that time.

THE COURT'S ROLE INADDRESSING ALIENATION

Differing "alienation" theories promoted by many public advocacy groups, as well as psychological and legal communities, have differing scientific and empirical foundations. However, interference with the non-custodial parent's relationship with a child has always been considered in the context of a "parent's ability to encourage the relationship between the non-custodial parent and a child," a factor to be considered by the Court in custody and visitation/parental access determinations. See, Eschbach v. Eschbach, supra. Our Appellate Courts recognize such factor, as they have determined that the "interference with the non-custodial parent and child's relationship is an act so inconsistent with the best interests of a child, as to, per se, raise a strong probability that the offending party is unfit to act as a custodial parent." See, Leistner v. Leistner, 137 AD2d 499; Finn v. Finn, 176 AD2d 1132, 1133, quoting Entwistle v. Entwistle, 61 AD2d 380, 384-385, appeal dismissed 44 NY2d 851; Matter of Krebsbach v. Gallagher, 181 AD2d 363, 366; Gago v. Acevedo, 214 AD2d 565; Matter of Turner v. Turner, 260 AD2d 953, 954; Zeiz v. Slater, 57 AD2d 793.

Where, as in the instant case, there is a finding of a willful violation of a court order demonstrated by a deliberate interference with a non-custodial parent's right to visitation/parental access, the IAS Court, as a general rule, must schedule an evidentiary hearing before making any modification of custody. See, Glenn v. Glenn, 262 AD2d 885. See, also, Entwistle v. Entwistle, 61 AD2d 380; Young v. Young, 212 AD2d 114; Matter of LeBlanc v. Morrison, 288 AD2d 768, 770, quoting Matter of Markey v. Bederian, 274 AD2d 816; Matter of David WW v. Lauren QQ, 42 AD3d 685; Goldstein v. Goldstein, 2009 N.Y. Slip Op. 08995 [Dec. 1, 2009].

SENTENCE

An imposition of sentence upon a finding of contempt should contain a language permitting the contemnor an opportunity to purge. See, Heyn v. Burr, 19 AD3d 896; Stempler v. Stempler, 200 AD2d 733; Cooper v. Cooper, 21 AD3d 869. Under the circumstances here, where determination is made of a past violation of an order of parental access/joint custody, there can be no purge since it is no longer within the plaintiff's power to perform the act. See, Kruszczynski v. Charlap, 124 AD2d 1073; Young v. Young, 129 AD2d 794. Moreover, the use of remedial intervention - - parenting coordination/counseling - - during the course of the trial was unsuccessful, and even if re-utilized here, the Court cannot condition release from imprisonment upon future compliance. See, Martinez v. D.S.S., 44 AD3d 945.

Accordingly, and after careful consideration of the circumstances of the nature and extent of the multiple instances of violation of the court order, the plaintiff is sentenced to a period of incarceration for six weekends, to be served on the first and third weekends of each month for the months of June, July and August, 2010. Prior to these weekends of the plaintiff's incarceration, she shall transport the children to the defendant's home to assure their continued care and well being. See, Marallo v. Marallo, 128 AD2d 710; Gordon v. Janover, 238 AD2d 545; Munz v. Munz, 242 AD2d 789; Kruszczynski v. Charlap, supra; Barcham-Reichman v. Reichman, 250 AD2d 609.

COUNSEL FEES

Given the finding of a willful violation of the Judgment of this Court (Stack, J.) Dated March 26, 2004 [erroneously dated as 2003], and given the fees requested ($134,352.92 for defendant's counsel, $11,287.50 for Attorney for the Children's fees, and $19,833.32 for Parenting Coordinator fees, shall be the object of a hearing to be held before me on June 4, 2010. While the parties consented to such determination on submission, the issues presented lend themselves to the Court's assessment of the parties' finances. To facilitate a complete record, a hearing is ordered herewith. See, Judiciary Law §773; Gordon v. Janover, supra.

On the Court's own motion, this decision and order will be stayed until June 4, 2010 to afford the plaintiff an opportunity to seek Appellate Review, if so advised, and it is

ORDERED, that the plaintiff, L. R., is adjudged to be in civil contempt of the Judgment of Divorce dated March 26, 2004; and it is further

ORDERED, that the parties and their counsel shall appear before me for sentencing on June 4, 2010 at 9:30 a.m., which date may not be adjourned without written order of this Court; and it is further

ORDERED, that the plaintiff, L. R., is sentenced to a period of six weekends imprisonment in the Nassau County Correctional Facility, pursuant to the schedule set forth herein; and it is further

ORDERED, that this order and execution of this sentence shall be stayed until June 4, 2010; and it is further

ORDERED, that this decision shall be deemed an order and/or warrant of commitment pursuant to and in accordance with Judiciary Law §772; and it is further

ORDERED, that a copy of this Decision and Order shall be served upon the Sheriff of Nassau County and/or the Warden of the Nassau County Correctional Facility to facilitate the schedule of weekend incarceration, to be imposed as follows:

Friday, June 11, 2010 at 6:00 p.m. to Sunday, June 13, 2010 at 6:00 p.m.;

Friday, June 25, 2010 at 6:00 p.m. to Sunday, June 27, 2010 at 6:00 p.m.;

Friday, July 9, 2010 at 6:00 p.m. to Sunday, July 11, 2010 at 6:00 p.m.;

Friday, July 23, 2010 at 6:00 p.m. to Sunday, July 25, 2010 at 6:00 p.m.;

Friday, August 6, 2010 at 6:00 p.m. to Sunday, August 8, 2010 at 6:00 p.m.;

Friday, August 20, 2010 at 6:00 p.m. to Sunday, August 22, 2010 at 6:00 p.m;

and it is further

ORDERED, that this Court finds that the conduct of the plaintiff was calculated to, or actually did, defeat, impair or prejudice the defendant's rights or remedies.

This constitutes the decision and order of this Court.

1. This witness retired from his position, and returned to New York to testify at this hearing.

Decision of the Day

Family Law

203699-02

Supreme Court, Nassau County

Decided: May 25

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June 09, 2010

Late-Life Divorce: Al and Tipper Gore

Posted By Brian Perskin

Al and Tipper Gore made the shocking announcement that they are going to separate after 40 years of marriage. This separation comes as such a surprise not only because Al and Tipper seemed to epitomize wedded bliss, but also because they are splitting up at such late stages in their lives.

Usually divorces occur either during the first two years of marriage or between the fifth and seventh year. After a long- term marriage, such as Al and Tipper's, the couple's lives are intertwined-- the spouses share a home and there are children and grandchildren. To most, a divorce at that point just seems inconvenient.

While some might scratch their heads at the thought of divorcing after the age of sixty, divorce lawyers are unmoved by the age at which Al and Tipper decided to part ways. Divorce attorneys have recently been witnessing the steady increase in the divorce rate among people in their 40s, 50s, and 60s.

Due to developments in science and medicine, people's life spans have been extended. These longer life spans encourage married couples to choose divorce so late in life. These extra years are an opportunity to find someone new, to gain a sense of individual freedom, or to just enjoy one's retirement years without the unpleasantness of arguing with a spouse.

With longer and healthier lives, late-life divorces are growing to be more and more accepted. Having been a well -known couple, Al and Tipper have enlightened the public and shed light on this developing trend.

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June 07, 2010

Facebook Profiles Swaying Divorce Cases

Posted By Brian Perskin

Social media websites, such as Facebook, contain a bounty of personal information. Thus, according to CNN.com's "Divorce Attorneys Catching Cheaters on Facebook," these websites have become an effective tool for divorce attorneys, who are looking to dig up dirt on their clients' spouses. Divorce lawyers can easily access one's Facebook page. For example, lawyers use websites like Flowtown.com, on which they can type in an email address and subsequently view various social media profiles; or, the attorney could find one's profile by hiring a private investigator.

Once attorneys gain access to a profile, they scroll through wall posts and personal information, read status updates, and sift through photos to find any kind of evidence that catches the client's spouse in a lie. Mutual friends of the spouses are usually the most valuable resources. Most often, while the couple is going through a divorce, they de-friend each other, but they forget about their mutual friends. These shared friends "can play detective" and obtain information from either spouse's profile.

As a result of "social media stalking," divorce attorneys are able to poke holes in the credibility of the client's spouses. With the information that an attorney retrieves from a social media website, whether it be uncovered affairs or the exhibition of unacceptable behavior online, the lawyer could sway the outcome of the entire trial.

According to a professor of psychology at Bridgewater College in Massachusetts, people do not see the harm in displaying information online because they believe that no one would ever really look at it. Nevertheless, the number of divorce cases that utilize social media sites have spiked over the last five years. In order to protect one's information, one must become familiar with privacy settings.

For those who use Facebook and are going to be involved in a divorce or custody battle, double check your profiles, edit them, tighten their privacy, be careful of what you post, and take heed of Facebook friends who might not truly be your friends. Or, to undoubtedly ensure the protection of your personal information, it would be easiest to just deactivate your Facebook account.

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May 20, 2010

Irreconcilable Differences Nearing Reconciliation in New York

Posted By Brian D. Perskin

For the past twenty-five years, New York has been the only state in the country without a no-fault--irreconcilable differences--divorce. It seems as that may finally change as a bill that aims to reform domestic relations law, by adding irreconcilable differences as a ground for divorce, has advanced in the state Senate Judiciary Committee this week.

Another bill approved by the Senate committee would create guidelines for determining the amount and duration of maintenance payments to the "non-monied" spouse. However, Judges would have discretion to depart from the guidelines if they state their rationale in writing.

Currently, a divorce can only be granted if a plaintiff alleges and proves one of the five grounds contained in Domestic Relations Law section 170 such as abandonment, adultery, and cruel and inhuman treatment. David King, of The Gotham Gazette, writes that "proponents of no-fault divorce say that forcing couples to accuse each other of wrongdoing, abuse, infidelity, neglect, can make a difficult process even worse -- not only for the couple but for the children involved and also can lead to tremendous legal costs. 'No one cares about no-fault divorce until their marriage is falling apart and they find out, "Oh, my god, there is no no-fault option",' said Sen. Liz Krueger, who supports the Hassell-Thompson legislation. 'Couples find out they have to allege something that may not really be true.'"

With the change in law, a party can simply allege that irreconcilable differences have arisen and there is no prospect of reconciliation. If a couple lives separate and apart for a period of one year, there is a presumption that there is no prospect of reconciliation. This ground will enable a party to obtain a divorce without proving fault, instead, the party will establish that the marriage is over and there is no prospect for reconciliation.

According to King, Assemblymember Jonathan Bing replied that "the legislation will decrease domestic violence by helping the abused partner get out of a bad marriage quickly. 'I think for years there was concern that women in a lesser financial situation than their spouse would be in a bad position,' said Bing, 'But we've seen it work in other states, and it has reduced rates of domestic violence and the cost of divorce, because people aren't spending years in litigation.'"

It is important to hire a lawyer who stays up to date on the latest developments in the law. For further information about The Law Offices of Brian D. Perskin please click here.

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May 12, 2010

The Significance of Signatures

Posted By Brian D. Perskin

SUFFOLK COUNTY
Supreme Court

Justice MacKenzie

SUMMARY
There is a bright line rule of law that an agreement lacking the proper acknowledgment is unenforceable. It is undisputed that the parties were married September 27, 2003 and separated January 5, 2007, and negotiated a Separation Agreement which was ultimately signed by defendant on September 12, 2007 and her signature properly acknowledged. Said agreement was forwarded to plaintiff who also signed but failed to have his signature properly acknowledged. Defendant received a copy of the agreement with plaintiff's unacknowledged signature approximately one year later with plaintiff's handwritten changes. Defendant notified plaintiff by letter dated September 15, 2008 of the acknowledgment issue, revoked her signature and objected to any attempt by plaintiff to remedy the invalid execution of the Agreement.

Plaintiff moves this Court for an order granting him summary judgment, divorcing the parties pursuant to DRL §170(6) and granting plaintiff an award of counsel fees. Alternatively, plaintiff seeks an order dismissing defendant's counterclaims for equitable distribution and maintenance and sanctioning defendant based on defendant's submission of an alleged false Statement of Net Worth. Plaintiff states that the parties entered into a Separation Agreement on September 12, 2007 and lived according to said agreement thereafter. Plaintiff states that upon notification by the defendant in a letter in September of 2008, wherein she revoked her signature and objected to plaintiff rectifying the problem, plaintiff realized that his signature was not properly acknowledged as per DRL §236(B)(3). Shortly thereafter, plaintiff had his signature acknowledged and filed the Agreement with the County Clerk on July 30, 2009. Accordingly, as the parties have lived separate and apart for over one year, plaintiff avers that a conversion divorce should be granted. Plaintiff argues that any efforts by defendant to abandon said Agreement and change the terms therein are meritless and nothing more than an opportunistic change in position. Plaintiff challenges defendant's Statement of Net Worth and her claimed income.

Defendant cross moves for an order denying plaintiff's application; granting summary judgment in favor of defendant and dismissing plaintiff's first, fifth and sixth causes of action. Defendant states that she gave plaintiff the Agreement after she signed and acknowledged same and never received a copy of such from defendant until one year later. Further, defendant argues that plaintiff's subsequent acknowledgment is irrelevant as he did so only after she revoked her signature. Accordingly, defendant avers that a divorce can not be granted on the basis of an invalid agreement. Additionally, defendant asserts that the requests for counsel fees and sanctions must be denied as same are based on provisions contained in an invalid agreement.

Plaintiff argues that a subsequent acknowledgment is acceptable if such complies with DRL §236(B)(3). Further, plaintiff stresses that the parties lived in accordance with the Agreement thus ratifying same.

Defendant argues that plaintiff made notable changes to the Agreement upon receiving same from defendant and that the defendant was not aware of those changes. Finally, defendant reiterates that the Agreement was acknowledged by plaintiff only after defendant's revocation of her signature.

A motion for summary judgment shall be supported by affidavit, by a copy of the pleadings and by other available proof, such as depositions and written admissions. The affidavit shall be by a person having knowledge of the facts; it shall recite all the material facts; and it shall show that there is no defense to the cause of action or that the cause of action or defense has no merit. The motion shall be granted if, upon all the papers and proof submitted, the cause of action or defense shall be established sufficiently to warrant the court as a matter of law in directing a judgment in favor of any party (CPLR §3212(b)).

An agreement by the parties, made before or during the marriage, shall be valid and enforceable in a matrimonial action if such agreement is in writing, subscribed by the parties, and acknowledged or proven in the manner required to entitle a deed to be recorded (DRL §236(B)(3). An agreement lacking said acknowledgment prerequisite is unenforceable (Matisoff v. Dobi, 90 NY2d 127 (1997)). An unacknowledged nuptial agreement which is acknowledged on a subsequent date is enforceable in a matrimonial action if the later acknowledgment is in compliance with DRL §236(B)(3) (Arizin v. Covello, 17 Misc.2d 453 (NY County Supreme Court, 1998)). While a revocable offer to a bilateral contract may be revoked at any time prior to acceptance, that revocation or rejection is effective at the moment of receipt (Buchbinder Tunick & Co. v. Manhattan National Life insurance Co., 219 Ad2d 463 (1st Dept. 1995), citing Calamari & Perillo, Contracts §2-20 at 114). An agreement is deemed ratified when a party accepted the benefits of such and substantially complied with its terms (Brennan v. Brennan, 305 AD2d 524 (2nd Dept. 2003)).

It is undisputed that the parties were married September 27, 2003 and separated January 5, 2007. Further, the parties negotiated a Separation Agreement which was ultimately signed by defendant on September 12, 2007 and her signature properly acknowledged. Said agreement was forwarded to plaintiff who also signed but failed to have his signature properly acknowledged. Defendant received a copy of the agreement with plaintiff's unacknowledged signature approximately one year later with plaintiff's handwritten changes. Defendant notified plaintiff by letter dated September 15, 2008 of the acknowledgment issue, revoked her signature and objected to any attempt by plaintiff to remedy the invalid execution of the Agreement.

First, at the time of defendant's revocation, plaintiff's signature had not been properly acknowledged and, thus, there was no effective Agreement. There is a bright line rule of law that an agreement lacking the proper acknowledgment is unenforceable, supra, (Matisoff v. Dobi at 135,36). It follows that a revocation received prior to a proper acknowledgment shall be given effect as there can be no valid acceptance without meeting the statutory requirements for execution.

Second, in the case at bar, it is clear that plaintiff made certain changes and notations to the parties' Agreement subsequent to defendant's signature and acknowledgment on September 12, 2007 and prior to the acknowledgment of his own signature on September 18, 2008. Specifically, there is a two page insert between pages 15 and 16 of the Agreement wherein plaintiff writes that certain terms are unacceptable with a date of 10-12-07, one month after defendant signed the Agreement. These, in addition to changes or notations made by plaintiff on pages 1, 3, 4, 5, 6 and 13, are not initialed by defendant which initials would serve to indicate that she reviewed and accepted same. Plaintiff altered the terms of the Agreement by making the above noted changes, terms that were not presented to defendant until she received a copy of the "amended" Agreement approximately one year later. As such, defendant's written revocation to plaintiff dated September 15, 2008 was effective upon receipt by the defendant, which he admits, for two reasons: one, the Agreement was not properly executed when the revocation was received; and, two, defendant had never accepted the new terms of the "amended" Agreement. Plaintiff's efforts to acknowledge his signature three days after revocation do not make the Agreement enforceable as no agreement had been reached between the parties. Thus, there can be no substantial compliance as required by statute.

For reasons cited herein, the Court finds the plaintiff's arguments with regard to ratification and/or estoppel to be without merit.

Further, this Court rejects plaintiff's challenges to defendant's statement of net worth in that same are based on an appraisal of defendant's business by an appraiser retained by plaintiff using incomplete discovery.

The remainder of plaintiff's arguments with regard to any benefits defendant received will be considered in the context of this matrimonial litigation.

Accordingly, it is

ORDERED, that plaintiff's application is DENIED in its entirety; and it is

ORDERED, that defendant's application to grant her summary judgment with regard to plaintiff's first, fifth and sixth causes of action in the Second Amended Verified Complaint and dismissing same is GRANTED in that all are based on the parties' Separation Agreement being deemed valid. This Court has declared said Agreement to be invalid thereby making these causes of action without merit; and it is

ORDERED, that counsel and the parties shall appear for a conference in this matter on May 17, 2010.

The foregoing constitutes the order of this Court. ¦

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May 12, 2010

Chutzpah in Marital Jurisprudence

Posted By Brian D. Perskin

In a recent decision by Judicial Hearing Officer Stanley Gartenstein, the Court strongly considered the believability of a party's poverty claim in its award of maintenance and child support. In New York matrimonial and family law cases, it is essential to remember that Judges will examine an individual's expenses and lifestyle in determining maintenance, child support, and equitable distribution. Below find the text of the decision.

Judicial Hearing Officer Stanley Gartenstein

NASSAU COUNTY
Supreme Court

Judicial Hearing Officer Gartenstein

DECISION

J ¹ 's efforts to beat the system represent a new zenith in chutzpah. ²

After a long and bitterly contested trial, this complex litigation may best be summed up as a well crafted but legally bankrupt claim of "sudden poverty", a disease which seems to infect matrimonial litigants with particular frequency. Apart from the time, effort and expense to which J has put his wife to penetrate the smoke screen he has so skillfully created-and we must begrudgingly give him credit for that-his schemes are a house of cards constructed by a self-indulgent individual intent upon his own gratification at the expense of all those innocent persons who have given of themselves to him and who had a right to expect more.

THE MARRIAGE

The parties ("N' and 'J") were married in 1980 in a religious ceremony. There are three children, A, born XXXX; S, born XXXX; and E, born XXXX. A is past the age of emancipation; S will reach that age in less than a half year; E has XXXXX and XXXXX traits. She has undergone surgery for XXXXX.

JURISDICTION

This action was commenced on September 26, 2005. It has tortuously wound its way through the Court and been referred to the undersigned, a Judicial Hearing Officer, who conducted the trial upon a hear and determine stipulation. The trial commenced on June 1, 2009 and concluded on October 28, 2009. Closing submissions are now complete.

CHUTZPAH/CREDIBILITY

Because the "sudden poverty" defense makes credibility the central issue in any matrimonial action, we are called upon to assess the motives of the respective parties and their incentive or lack of it to color the truth or lie outright. Our insight into J must therefore, at least to some extent, be governed by the chutzpah he has demonstrated.

It doesn't take chutzpah to cheat on one's spouse. But J didn't just cheat on N. He diverted marital income to take his girlfriend on luxury vacations which he charged to a credit card knowing that the bill would necessarily come to his home and be opened by N. He refused to give up this meretricious affair or leave the marital home even after this action was commenced, insisting instead on humiliating N by carrying it on openly and notoriously while living under the same roof with her and the children.

Nor does it take chutzpah to claim poverty while bedecking oneself in $5,300 designer jeans from Tyrone's in Roslyn Village. But J's "explanation" would have the Court believe that these designer jeans in particular were purchased solely to comply with a one day per week dress-down code allegedly prevailing in his new work environment.

It doesn't take chutzpah to devise a scenario of "sudden poverty'. But J closed down one of New York's premier stationery stores on the eve of trial, thereby putting 24 faithful employees on the unemployment lines.

Nor does it take chutzpah to steal from one's own father. But J plundered his dying father's estate as he suffered from Parkinson's disease and lacked the physical and mental capacity to "lend" the money J claims to have "borrowed". And when caught by his father's executor with his hand in the cookie jar, J brazenly advanced the interesting proposition that N of all people should shoulder part of the responsibility to make restitution.

It doesn't take chutzpah to demand custody of the children. But J litigated for custody of two estranged sons who barely speak to him and as he was about to face cross-examination, his demand mysteriously evaporated.

Nor does it take chutzpah not to get along with one's in-laws. But J hired a detective to dig up actual or imagined dirt on his 84 year old father-in-law. This at the same time he was scheming to avoid paying maintenance by claiming that N's father, the very same 84 year old father he was trying to discredit, would obtain employment for her thereby taking him "off the hook".

It doesn't take chutzpah to claim poverty while maintaining membership in the exclusive Muttontown Golf Club. But J maintained his membership first; then took a leave of absence conveniently timed for his application for downward modification; then, after its denial, reinstated himself until the eve of trial; and then conveniently "canceled" so that he could again claim poverty.

These acts raise the bar. They establish a new standard in chutzpah, even for matrimonial actions.

The issues of this litigation are so intimately interwoven with J's alter-ego business entity that the Court's ultimate decision will necessarily center on its assessment of that entity's inner structure. For this reason, detailed analysis of AS, J's alter ego, must constitute a required threshold to any decision addressed to the financial equities between the parties.

AS, a thriving retail and wholesale office supply on Madison Avenue and 40th Street in New York City, was founded by defendant's grandfather. It was then owned and operated by his father, B. J, representing the third generation, worked there, effectively assuming control during years in which his father grew old. He forced his brother S out of the business on one day's notice over some personal issue. He and his sister, J, now effectively own all the assets of AS in whatever form they now exist; J's husband and J now operate what remains of AS.

In view of J's pained outcry that AS is worthless, it is interesting that, "poverty" and all, he recently purchased his brother's 16 percent share of AS for $350,000

On the eve of trial, J, claiming that AS had suffered devastating losses which mandated that he close the store, reinvented the business with an elaborate structure which basically, notwithstanding his claims to being destitute, kept his flow of income intact while showing an illusory business decline. He accomplished this by closing his Madison Avenue store, making his business an independent contractor of one of the country's largest buying offices, WLG, into whose office he physically moved. In so doing, he took advantage of the tremendous discounts generated by WLG's purchasing volume while virtually eliminating overhead expenses.

J's new corporation is known as GM, LLC. He owns 51 percent thereof. He is also the owner of 50 percent of AS and 50 percent of ABC, a separate entity created to fill customers' demand for coffee and bottled water. It is claimed that AS's only income is from a licensing agreement with GM, the net effect of which provides that GM make certain payments for the good will, name, phone number, etc. of AS.

As pointed out in plaintiff's closing argument, J had certain concerns on the eve of trial:

1. He and his sister J were liable for a line of credit with HSBC in the sum of $250,000;

2. If his new business arrangement with WLG did not succeed, he would then be compelled to resume business with his former supplier, UN, to which AS had a running remaining balance of $474,480;

3. A $205,000 shareholder's "loan" which he could "repay" by distributing to himself and his sister tax free;

4. AS's $2,428,000 loss carry forward which would allow it to write off income, to the extent of this loss.

J's incorporation of GM was immediately followed by an independent contractor's agreement on its behalf with WLG on September 25, 2008 which provided that GM would purchase supplies through WLG which offered substantial purchase discounts. The contract provided that GM and WLG would divide gross sales revenues forty (40 percent ) percent to GM and sixty (60 percent ) percent to WLG. Additionally, for the first three years, GM is paid an additional bonus by WLG equal to ten (10 percent ) percent of the gross profit. WLG assumed payment for GM's staff salaries up to $35,000 per year for each million dollars of GM's gross annual sales. The contract with WLG provides that for the first year (October 1, 2008 through September 30, 2009) this amount would be based on $5 million of sales or $175,000 of salary paid to the GM staff. Thereafter, it is to be adjusted pro rata in accordance with the actual gross sales of GM.

GM, J, J, and a small staff then physically moved in with WLG and now operate from there.

Following execution of the contract, AS then delivered a promissory note (November 12, 2008) to its former supplier UN Stationers in the aggregate sum of $474,480. By its terms, as of February, 2010 the balance due thereon is $158,160. Although not required to do so, on November 15, 2008, three days following execution of the promissory note by AS, J personally guaranteed payment of it.

This assumption of personal liabilities furthered J's scheme to preserve the valuable assets remaining in AS, including the shareholder's loans and loss carry forward as well as the ability to structure other tax and business benefits.

On September 24, 2008, AS entered into a "Licensing Agreement" with GM (both totally controlled and dominated by J wherein GM agreed to pay $26,200 per month ($314,400 per year) to AS for the use of AS's name, telephone number, website and customer list. J admitted under oath that this sum was determined solely by him and that it was based upon AS's debt. ³

D, CPA, a respected evaluator, testified that the licensing fee of $26,200 per month was obviously established to enable GM to reduce its taxable income by deducting this so-called "fee" paid to AS as a business expense. AS could then offset this income from GM against its $2,428,000 loss carry forward. This results in a double deduction for D's related companies, and enables him to manipulate the taxable income of both entities in violation of IRS Code Section 1201.

In getting from Point A to Point B, AS suddenly changed the method of preparation of its December 2008 financial statement from a "review" standard, which requires investigation and verification of all financial information provided, to a "compilation" standard for the last financial statement dated December 31 2008. This latter standard is based solely upon J's representations concerning his financial transactions. He never produced a "reviewed", much less "audited", financial statement for December, 2008, the only six month period in which AS reported a "loss". ⁴

D prepared an analysis of cash flow of GM and AS. In the first year of operation, GM received $508,266 in commissions, plus a bonus of $132,465. Thus, its total income for the first year of operation was $640,733. After various deductions including deducting the so-called "licensing fee" paid to AS, the resulting total cash flow was $549,933. Fifty percent of this figure, viz, $274,966 would reasonably flow as income to J for the first year of operation based upon the assumption that the UN note would be paid in full. Plaintiff urges that this is the appropriate income to be imputed to J as the basis for her claim for maintenance and child support. She asserts no claim in equitable distribution to any part of this business, whatever format is in current use. Her closing argument points out that the balance due on the UN note is $158,160. J's own filings outline his tax refunds of $248,280 received (or shortly to be received) pursuant to his filings in the Fall of 2009. Accordingly, after payment in full of J's share of the HSBC line of credit ($125,000) being held pursuant to this Court's Order), he will have available, by reason of tax refunds, an additional $113,848, a sum more than sufficient to fully satisfy his obligations to UN. This would make available to his business entity a full line of credit which has been unavailable for years.

Assuming arguendo that J continues paying the so-called "licensing fee", he will then have the wherewithal to repay himself and his sister the outstanding shareholder's loans of $205,000 tax free any time he so desires. This will reduce the tax liability of GM by having it make payments to AS which bear no proportionate relationship to AS's assets and will artificially reduce GM's income so that AS will receive tax free income by deducting it against its $2,428,000 loss carryover. All this rests in J's uncontrolled discretion. He is in effect taking money from one pocket and putting it in another. He has masterfully manipulated the shadow entities created at his direction to present an illusion of legitimacy. Thus everything which has or will happen boils down to J and only J.

In the face of J's "sudden poverty" claim that his business has been in a downward spiral first because of 9-11, second because of competition from Staples, it is appropriate to note the amounts reported as business income on his tax returns as follows:

2000 $214,960

2001 $206,052

2002 $206,967

2003 $210,475

2004 $214,310

2005 $227,864

2006 $239,476

2007 $241,388

J's companies have also consistently logged increasing gross profits in the face of his claim that business was dramatically declining. The evidence shows that reported gross profits were:

2001 32.45 percent

2002 36.25 percent

2006 35.9 percent

2007 36.13 percent

2008 33 percent

During GM's first year of operation gross profit percentages were shown to be consistent with AS's as follows:

October 2008 32 percent

November 2008 34 percent

December 2008 30 percent

January 2009 32 percent

February 2009 32 percent

March 2009 32 percent

April 2009 30 percent

May 2009 31 percent

It is also painfully clear from the evidence that virtually all personal expenses, credit cards, bills, groceries, life insurance, disability insurance, cell phone, automobile, long term care, and commutation expenses for J have been paid through these business entities in a total expenditure which dwarfs his declared earnings.

The totality of the evidence paints a picture of J's undiminished wealth and an almost obsessive single-mindedness on his part to do N, his long-term wife and mother of his children, out of her just entitlement. His testimony, obviously contrived for the trial, was pedantic, often condescending. J made sure to lecture the Court about how his elderly father-in-law, as he tells it, the source of all his problems, ruined his life in some vague and unspecified manner. The Court was often called upon to strike his gratuitous remarks and cut off seemingly endless monologues. At one point, it became necessary to call a recess and instruct him to leave the courtroom temporarily and return "without the attitude".

It is indeed rare that a court is presented with a tissue of ready-made fabrications so extensive and far reaching that it literally mandates disbelief of a witness' entire testimony.

LIFESTYLE

Where, as here, the transcendent issue is maintenance, it is appropriate that the lifestyle of the parties be considered first. In this connection, it is relevant to point out that in the original enactment of DRL §236, et seq., the standard of living of the parties while married was listed as one of the enumerated factors to be considered by the trial court. The Legislature, later finding that consideration of lifestyle as one factor among many was "feminizing poverty', removed it as one of the in seriatum factors and inserted it in the preamble of subsection 6 thus granting it transcendent effect.

N's evidence of lifestyle was not effectively contraverted at the trial or in defendant's closing memorandum. Indeed, the thrust of J's closing argument once again disingenuously postulates without basis that the parties always lived beyond their means during their marriage. J's flow of income absolutely belies this. We therefore track herein plaintiff's recitation of the evidence as set forth in her closing argument.

At the time they were married, N and J moved to an apartment in New York. They immediately obtained full golf memberships at the Muttontown Country Club where they dined on weekends and where J would play golf. They also regularly dined at expensive New York City restaurants. On their many vacation trips, they hired private tour guides and routinely shopped at exclusive stores (Armani, Bottega Venetta, Gucci, Fendi, etc.).

N worked for her father in his jewelry business until their first child, A, was born on XXXX. Thereafter, she managed a Tiffany account part-time on recommendation from her father. She earned between $35,000 and $45,000 in 1989 and 1990 solely from commissions without relationship to time actually worked.

In 1988, N and J purchased a home and moved to Roslyn. The down payment came from proceeds of the sale of their New York City apartment and from gifts totaling $75,000 from N's parents and grandmother. N asserts no separate property claim for these monies.

In 1989, the parties gutted their home, adding 1,500 square feet (new kitchen, master bedroom and bath; windows and siding; new heating system; hot water heater and additional air conditioning zone) at an approximate cost of $300,000. In addition to the Muttontown membership, they also joined Pines Pool Club and the Atlantic Beach Club.

J and N employed a live-in housekeeper and sent the children to exclusive day and sleep-away camps. They also took lavish vacations-Vail, Colorado (rental of house and skiing); Lion's Head (approximately $12,000); Venetian Resort and Spa, Scottsdale, Arizona, ($10,000); Beaver Creek, ($12,000); Boca Raton, (numerous occasions); Disney World (numerous occasions); Sandy Lane, Barbados (five star hotel $12,000); Las Vegas, Ritz Carlton ($17,000); Italy: Hassler Hotel, Rome; Lugano Hotel, Florence; Bauer Hotel, Venice, ($18,500 hotels alone); Hawaii, Four Seasons Hotel ($11,500); Blacombe, Canada, Whistler Hotel, ($22,000); Anguilla ($22,000).

In May, 2005 N and J traveled to London twice to see a rock and roll group, purchasing tickets costing $800 each, (total concert cost $3,200, total with hotel, $15,000).

Needless to point out, J also took numerous trips with "friends," without N, including: Greece (with girl friend); Brandon Dune, Oregon; South Carolina (twice); Las Vegas, Bellagio Hotel (with girlfriend); Miravel Spa, Arizona (with girlfriend); Cancun; Sandy Hill, Nebraska; Miami (with girlfriend); South Carolina (golf trip). Numerous additional golf trips were elicited during trial.

N was primary caretaker of the children, responsible for the household's functioning. She was active in the children's education and sustained them in their medical issues which included A's XXXXX disorders, S's XXXXX and L's XXXXX, XXXXX and XXXXX.

N is 51 and in good health. J is 52.

Immediately prior to commencement, J entered into contracts and obtained estimates for additional renovation of the marital residence in an approximate sum of $100,000, to include the boys' bedrooms, new furniture, redoing the master bath and bedroom and redesigning the front entrance. He retained an architect (Spring, 2005) to carry these forth, while advancing a claim to the Court in bad faith that his business was failing. Indeed, when N learned of his extramarital affair, and upon his refusal to end it, it was N who stopped the work on the house and commenced this action.

N demands spousal maintenance of $5,416.67 per month ($65,000 per year) for fifteen years (citing DRL §236(B)(6)(a); DiBlasi v. DiBlasi, 48 AD3d 403), emphasizing her long-term marriage (cf. Chalif v. Chalif, 298 AD2d 348) and the luxurious standard of living enjoyed by the parties during marriage (Hartog v. Hartog, 85 NY2d 36 (1995)..

An award of maintenance, amount and duration thereof, is an issue vested in the sound discretion of the trial court.

In Hartog v. Hartog, supra, the parties, as here, were married for twenty years and were substantially the same age as N and J. Mrs. Hartog received substantial equitable distribution in excess of that which N's ultimate award will be here. The Court of Appeals reversed the Appellate Division's grant of non-durational maintenance to Mrs. Hartog, citing Domestic Relations Law §236, et seq. which required that the Court give special consideration to the marital standard of living. It reinstated the trial court's decision calling for non-durational maintenance owing to Mrs. Hartog's inability to become self-supporting at a level commensurate with the marital standard of living. Holding that the legislative history of the statute unequivocally demonstrated the legislature's intent with regard to the pre-separation standard of living, Hartog emphasized that

"…the Wife's ability to become self-supporting with respect to some standard of living in no way obviates the need for the court to consider the pre-divorce standard of living, and does not create a per se bar to lifetime maintenance."

To be sure, N is capable of earning some money now. She currently works in a clerical capacity in a doctor's office earning minimal income ($12 per hour). Her claimed 'contacts" in the jewelry industry, stemmed primarily from her aged father and have dried up. She is untrained and uncredentialed. N will never have the capacity to earn sufficiently to resume her pre-separation standard of living. In the face of N's testimony that she might be capable of becoming self supporting in a lesser period of time, we respectfully believe her estimate to be overly optimistic and not supported by reality.

The Court declines to follow the conclusions of defendant's vocational expert who testified at the trial which were speculative and apparently tailored to minimize an appropriate award of maintenance to N.

The Court of Appeals in Summer v. Summer, 85 NY2d 114 (1995), reversing an appellate reduction of non-durational to durational maintenance and reinstating the trial court's decision held that "because Supreme Court's determination that the wife is incapable of becoming self-supporting at a level roughly commensurate with the marital standard of living comports with the weight of the evidence, we reinstate its judgment insofar as it awarded the wife permanent maintenance."

In Phillips v. Phillips, 182 AD2d 746, the Appellate Division in this Department affirmed an award of non-durational maintenance to a forty-nine year old wife based on a twenty-nine year marriage in which, the wife served as homemaker and sacrificed her career to care for three children. The husband, an attorney, earned between $100,000 and $200,000, the wife $15,400 with little apparent likelihood that her salary would increase to a point where she could become self-supporting. This holding closely approximates the facts before us.

In Bogannam v. Bogannam, 60 AD3d 985, the Second Department awarded ten years' maintenance following a twenty year marriage (husband's earnings $200,000).

Finally, in Kriftcher v. Kriftcher, 59 AD3d 392 the Second Department held that

"…although the wife earned a teaching license during the course of the marriage, she is, at present, primarily a homemaker, who works only part-time as a substitute teacher earning approximately $10,000 per year…. Considering, among other factors, the standard of living of the parties during the marriage, the distribution of marital property, the health of the parties, the present and future earning capacity of both parties and the ability of the party seeking maintenance to be self-supporting…a maintenance award…for ten years is appropriate."

J's affidavit of Net Worth as of commencement, received in evidence listed the parties' monthly expenses at $28,521. On the eve of trial, his updated Net Worth Statement as of December, 2008 acknowledged "after-tax" monthly expenses of $20,341.34 ($244,092 per year). It included no expense for medical insurance, an additional cost to N to follow this divorce. DRL §236(B)(6)(11) as amended effective September 14, 2009, now requires the Court to consider "the loss of medical insurance" as a factor in awarding maintenance. ⁵

The Court has considered the mandatory factors made relevant by DRL §236, et seq. to the extent set forth without adhering to a slavish repetition thereof. N is awarded $65,000 per year as demanded based upon her needs and expenses as conceded by J in both sworn net worth statements. The parties' home has been sold. N has moved to an apartment with the children. Her rent and expenses while deviating from those listed in connection with the house by J in his net worth statement, do not appreciably alter her need for the award as requested.

Notwithstanding the request for 15 years of maintenance, N will reach the age of full eligibility for Social Security in 14 years on her 65th birthday. The duration of our maintenance award to her differs slightly from her request in that our award runs to her 65th birthday, no later.

While maintenance is usually taxable to the wife unless stated to the contrary by the Court, the Appellate Division in this Department has ruled that any award relieving the recipient spouse of taxable liability for it must articulate a reason (cf. Grumet v. Grumet, 37 AD3d 534). The award of maintenance herein to the wife shall be tax free to her. We rely here upon the testimony of D to the effect that J's scheme with reference to "goodwill" payments to ASs is illegal under the Internal Revenue Code. We believe it inconsistent with public policy to provide him with yet another outlet to minimize the entitlement of the taxpayers to their fair share of his earned income. We do not perceive the morality of rewarding him for this dubious practice by providing yet another opportunity for him to manipulate his funds to the detriment of the taxpayers.

J's true income as projected by D is $274,966 less FICA and Medicare totaling $10,311. Deducting $65,000 awarded herein for maintenance from J's base salary for CSSA purposes, yields a total of $199,655. It is conceded that both boys are emancipated leaving L as the only child requiring an order of support. The statutory percentage of 17 percent is applied to the CSSA net income (less maintenance) of $199,655 yielding a total figure for child support of $34,000 per annum. We respectfully believe it appropriate to apply this percentage, notwithstanding the statutory "cap', to the total base figure in view of L's special needs. All applications to impute income to N for purposes of computation are denied as being without basis in fact or law.

We reiterate here that which we have indicated during trial that from a review of the credible evidence, D's figure is a conservative estimate not approaching our own estimate of J's actual income. Nevertheless, we are bound by propriety not to exceed the demand on record, lacking any showing that the demanded amount is inadequate to meet L's needs.

AUXILIARY DIRECTIVES

All monies now being held by J's attorneys in escrow or otherwise shall be transferred into custodial accounts and earmarked for college for S and L with N as custodian pursuant to stipulation dated August 21, 2009. Should these funds be inadequate to pay tuition, room and board in accordance with standards prevailing at SUNY (Binghamton campus), all additional funds shall be paid by the parties on a 90/10 allocation basis. This order is effective retroactive to the Fall, 2009 semester.

J is directed to obtain and keep in effect a life insurance policy of $4,000,000 to secure maintenance and child support payments. Duplicate premium notices addressed to N shall be arranged for by J.

J shall maintain medical and dental coverage for the unemancipated child and be responsible for 90 percent of all unreimbursed expenditures. To the extent feasible by law, no out-of-network providers shall be used without J's or, in the alternative, the court's approval.

J is ordered to pay the overdue sum of $18,250 to Doctor S for N's dental work. Failing same, the Court will direct entry of judgment against him upon appropriate application.

The funds now held by Oppenheimer representing an IRA of approximately $30,000 and a 401K in AS/GM of approximately $64,000 shall be divided equally. This directive shall be implemented by retention of Lexington consultants to draw appropriate QDRO orders with fees for same split equally between the parties.

N is awarded $60,699.50 representing 50 percent of the marital Madoff funds taken by J (cf. Exhibit 11) for his own purposes.

Counsel for defendant now holds $155,410 in escrow pursuant to written stipulation dated March 16, 2009. The husband's share of this escrow fund has been properly disbursed in accordance with this stipulation. The balance thereof belongs to N and shall be distributed accordingly.

During the trial, J moved for downward modification in the face of a "so ordered" stipulation to the effect that the applicable standard for modification would be "extreme hardship" and the further fact that he had already unsuccessfully moved for this relief once. This second motion which had been referred to the trial by the undersigned is denied.

The parties have disposed of the marital domicile by sale. A stipulation dealing with distribution of various sums of money not necessarily pertaining to the sale itself has been executed by the parties and is approved.

COUNSEL FEES

Plaintiff's application for counsel fees to the firm of B and R in the sum of $340,000 is granted based upon the equities of the case (O'Shea v. O'Shea, 83 NY2d 187); the relative circumstances of both parties (Charpie v. Charpie, 271 AD2d 169); the added burden imposed upon counsel by unreasonable and groundless claims (Brancoveanu v. Brancoveanu, 177 AD2d 614); the presence of imputed or hidden income (Steinberg v. Steinberg, 59 AD2d 702); the unnecessary prolongation of litigation by one party (Ventimiglia v. Ventimiglia, 36 AD2d 899); and attempts by one party to frustrate, discourage and otherwise intimidate the other (Schussler v. Schussler, 109 AD2d 875; Lowinger v. Lowinger, 245 AD2d 490). Counsel has fully complied with the appropriate rules promulgated by the Office of Court Administration. We find that counsel possesses the stature, ability, reputation and respect appropriate for these fees. The time charges claimed for performance of counsel's duties are reasonable, even conservative.

All claims, if any, for arrears or for retroactive effect to be extended to any order herein shall be brought on by motion in writing with supporting affidavits computing same with specificity prior to submission of final judgment.

Stipulations between the parties resolving a number of issues as presented with final submissions are approved. All issues addressed in the final submissions unresolved as of that time are now deemed fully resolved.

All prayers for relief by either party not addressed by this decision are hereby denied.

The foregoing constitutes the decision and order of this Court.

Settle final judgment on notice.

The Clerk shall retain all exhibits pending expiration of time to appeal.

1. Removed.

2. "Chutzpah (Yiddish)-unbelievable gall; insolence; audacity; cheekiness, impertinence, impudence, crust, gall, the trait of being rude and impertinent, inclined to take liberties."

Collins English Dictionary-6th edition, 2003

The Court of Appeals has encountered the necessity of expressing itself with this metaphor (cf. People v. Campbell, 97 NY2d 532).

3. D, CPA, an expert witness who evaluated those entities prior to trial, citing IRS Code Section 482, testified that the only legal method to determine the value of a licensing fee is upon an arm's length transaction for the value of the licensed assets, a proposition whose validity was acknowledged by J's own bankruptcy expert witness SP, Esq. Thus, if J is to be believed that AS "went out of business" or had "no value" as of the Fall of 2008, there could be no "fair market value" for the Licensing Agreement and certainly no consideration for it. Furthermore, the "Licensing Agreement" permitted the parties thereto, AS and GM, both alter egos of J, to change the licensing fee at will.

4. AS's "reviewed" financial statements from 2000 through June 30, 2008 have been received in evidence.

5. In addition to any monetary award, J is directed to fully cooperate in N's attempts to obtain COBRA coverage. ¦

SUPREMECourt

J.H.O. Gartenstein

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April 30, 2010

Discovery Denied

Posted By

In the case below from the New York Court of Appeals, the court finds no "egregious fault" in a case where a woman gave birth to a child of her paramour and lied to her husband about it for three years. By not finding an "egregious fault" the court precluded the possibility of obtaining discovery on the issue. In dissent Judge Piggot points out that the Court of Appeals is putting the cart before the horse, deciding whether there has been "egregious fault" before there was discovery that could substantiate or disprove that claim. The courts ruling will effectively deny discovery on all but the most extreme claim's of "egregious fault."

Howard S. v. Lillian S.

04-30-2010

Opinion by Chief Judge Lippman. Judges Ciparick, Graffeo, Read, Smith and Jones concur. Judge Pigott dissents in an opinion.

Decided: April 29; 71

LIPPMAN, Ch.J.—The dispute in this matrimonial action centers on the extent of discovery that should be permitted into issues of marital fault. As set forth in the complaint, plaintiff husband and defendant wife were married in May 1997. Defendant had one child from a previous relationship, who was later adopted by plaintiff. Three other children were born during the course of the marriage. The youngest child, born in 2004, was the product of an extramarital affair between defendant and an unidentified man. Plaintiff, unaware of his wife's infidelity until the child was over three years old, has raised that child as his own. Plaintiff alleges that, although defendant knew or should have known that the child was not plaintiff's, she withheld that information from him.

In 2007, defendant allegedly commenced another extramarital affair with an individual who was initially named as a co-respondent in this action. Plaintiff confronted defendant with his suspicions of her infidelity, but she denied that she was unfaithful. Defendant maintained that there were no grounds for divorce and the parties entered into the collaborative law process at her suggestion. Several months later, plaintiff obtained the results of a DNA marker test revealing that he was not the biological father of the youngest child.

Soon thereafter, plaintiff commenced this action asserting two causes of action for divorce—based on grounds of cruel and inhuman treatment and adultery—and a cause of action for fraud, seeking compensatory and punitive damages. The fraud allegations stated that defendant represented that she had been faithful to plaintiff and that he continued to participate in the marriage in reliance upon those representations to his financial detriment. He sought to recover damages under the fraud claim based upon costs he incurred due to defendant's failure to disclose her adultery—specifically, the amounts he expended in support of the youngest child, profits from marital investments that he would have deferred and fees for the collaborative law process. Among other things, plaintiff sought equitable distribution of the marital property, alleging that the bulk of the property should be awarded to him due to defendant's egregious fault. Defendant answered and asserted a counterclaim for divorce on the ground of abandonment.

Defendant moved to dismiss or sever the fraud cause of action and plaintiff cross-moved for liberal discovery relating to his fraud claim and to the issue of defendant's egregious fault for purposes of equitable distribution.1 Supreme Court denied defendant's motion to dismiss and found that the complaint stated a cause of action for fraud, but limited plaintiff's available damages to his pecuniary loss in the form of collaborative law process fees. The court also denied plaintiff's cross motion for liberal discovery, finding that defendant's actions did not rise to the level of egregious fault.

A majority of the Appellate Division affirmed, agreeing that defendant's behavior did not constitute egregious fault such that it could be considered for purposes of equitable distribution (62 AD3d 187 [1st Dept 2009]). The Court further found that plaintiff could only pursue his claims of actual pecuniary loss under the fraud cause of action and rejected the claims for lost profits, child support and punitive damages. One Justice dissented and would have allowed plaintiff to obtain liberal discovery on the issue of egregious conduct. The Appellate Division granted plaintiff leave to appeal, and we now affirm.

Domestic Relations Law §236 (B) (5) (d) sets forth the factors a court must consider when making an equitable distribution award. The statute does not specifically provide for consideration of marital fault, but does contain a catch-all provision that allows a court to consider "any other factor which the court shall expressly find to be just and proper" (Domestic Relations Law §236 [B][5][d][14]). We have, however, rejected the notion that marital fault is a "just and proper" factor for consideration, "[e]xcept in egregious cases which shock the conscience of the court" (O'Brien v. O'Brien, 66 NY2d 576, 589-590 [1985]). This rule is based, in part, upon the recognition that marriage is, among other things, an economic partnership and that the marital estate should be divided accordingly. We also observed that "fault will usually be difficult to assign and [that] introduction of the issue may involve the courts in time-consuming procedural maneuvers relating to collateral issues" (O'Brien, 66 NY2d at 590).

Although we have not had occasion to further define egregious conduct, courts have agreed that adultery, on its own, does not ordinarily suffice (see e.g. Newton v. Newton, 246 AD2d 765, 766 [3d Dept 1998]; Lestrange v. Lestrange, 148 AD2d 587, 588 [2d Dept 1989]). This makes sense because adultery is a ground for divorce—a basis for ending the marital relationship, not for altering the nature of the economic partnership. At a minimum, in order to have any significance at all, egregious conduct must consist of behavior that falls well outside the bounds of the basis for an ordinary divorce action. This is not to say that there can never be a situation where grounds for divorce and egregious conduct will overlap. However, it should be only a truly exceptional situation, due to outrageous or conscience-shocking conduct on the part of one spouse, that will require the court to consider whether to adjust the equitable distribution of the assets (see e.g. Levi v. Levi, 46 AD3d 520 [2d Dept 2007] [attempted bribery of trial judge]; Havell v. Islam, 301 AD2d 339 [1st Dept 2002] [vicious assault of spouse in presence of children]).2 Absent these types of extreme circumstances, courts are not in the business of regulating how spouses treat one another.

The complaint alleges that defendant committed adultery and that, as a consequence of that conduct, she conceived a child that she knew or should have known was fathered by another man and that she kept that information from plaintiff. Even taking these allegations as true, plaintiff has essentially stated a cause of action for adultery. While adultery, and many of its unintended consequences, will undoubtedly cause a great deal of anguish and distress for the other spouse, it does not fit within the legal concept of egregious conduct. Moreover, plaintiff's cause of action for fraud,3 is based entirely upon defendant's alleged adultery and on plaintiff's reliance upon the denial of that behavior. Plaintiff cannot obtain discovery for what is essentially an allegation of marital fault.4

Although CPLR 3101 provides for "full disclosure of all matter material and necessary in the prosecution or defense of an action," Domestic Relations Law §236 (B)(5)(d) is the specific statutory provision that governs equitable distribution in marital actions. Despite the general policy in favor of liberal discovery, this Court has interpreted the more specific section of the Domestic Relations Law to allow for consideration of marital fault in only a limited set of circumstances involving egregious conduct. In the absence of those circumstances, liberal discovery on issues of marital fault—at variance with O'Brien—should not ordinarily be permitted, though there may be exceptions in rare circumstances (see e.g. Anonymous v. Anonymous, 71 AD2d 209, 214 [1st Dept 1979]). Despite the availability of protective orders if courts were to consider these matters on a case by case basis, there remains significant potential for abuse and harassment as a result of such discovery, as well as the possibility that parties will be induced to enter into disadvantageous settlements rather than litigate these types of intensely personal issues.

Plaintiff's contentions pertaining to permissible damages with respect to his fraud cause of action are without merit.

1. The parties indicate that they have stipulated to a divorce on the ground of constructive abandonment. A copy of that stipulation was not included in the record on appeal.

2. Although the Appellate Division opinion below generally stated the correct standard, to the extent that it can be read to limit egregious conduct to behavior involving extreme violence, the definition should not be so restrictive.

3. We note that since defendant did not cross appeal the denial of the motion to dismiss the fraud cause of action to the Appellate Division, the issue of whether or not plaintiff stated a cause of action for fraud was not presented to that Court and is not before us.

4. This holding, of course, has no impact on a party's ability to seek discovery for the dissipation of marital assets (see Domestic Relations Law §236 [B][5][d][12]).

Accordingly, the order of the Appellate Division should be affirmed, with costs, and the certified question answered in the affirmative.

PIGOTT, J. (dissenting)—I respectfully dissent because, in my view, it is premature to rule that wife's behavior does not, as a matter of law, constitute egregious misconduct for purpose of equitable distribution under the Domestic Relations Law. Therefore, husband is entitled to discovery on his claim.

It is well-settled that parties are entitled to "full disclosure of all evidence material and necessary in the prosecution and defense of an action" (CPLR 3101 [a] [1]). This provision makes no exception for matrimonial actions. Further, as the majority recognizes, this Court has held that marital fault may be considered under factor 13 of Domestic Relations Law §236 [B] [5] [d] [13], which provides that a court may consider "any other factor which the court shall expressly find to be just and proper" (maj. opn. at 4 citing O'Brien v. O'Brien, 66 NY2d 576 [1985]). We limited such consideration of fault to "egregious cases which shock the conscience of the court" (id. at 589-590). It is within the court's discretion to determine whether a spouse's misconduct is so egregious to justify consideration for purposes of equitable distribution. In my view, the court should make this determination with full disclosure of the misconduct.

The majority finds that discovery on the issue of fault is precluded in this case. Although neither party affirmatively moved for a ruling on the egregious misconduct claim, the majority reasons that the conduct alleged by husband is not so egregious as a matter of law to be considered for purposes of equitable distribution. In my view, this is putting the cart before the horse. Indeed, the majority has implicitly accepted the view of the First and Second Departments that a party is required to make a motion for discovery on the issue of fault (see Ginsberg v. Ginsberg, 104 AD2d 482 [2d Dept 1984]; McMahan v. McMahan, 100 AD2d 826 [1st Dept 1984] [two Justices dissenting]). I disagree with this approach, and rather, take the view of the Third and Fourth Departments that have no general prohibition of pretrial discovery on fault, relying on our liberal discovery rule (see Nigro v. Nigro, 121 AD2d 833 [3d Dept 1986]; Lemke v. Lemke, 100 AD2d 735 [4th Dept 1984]). Under that rule, husband is entitled to discovery on the issue of fault, albeit with the court overseeing and preventing abuses by asserting its protective power (see CPLR 3101 [authorizing the court to issue a protective order "to prevent unreasonable annoyance, expense, embarrassment, disadvantage, or other prejudice to any person or the courts"]). By first permitting discovery on the issue, the court may adequately consider whether the misconduct alleged does indeed "shock the conscience of the court" so as to warrant consideration for purposes of equitable distribution.

Further, I cannot agree with the majority's reasoning for imposing a rule that would require a party to first seek permission from the court to obtain discovery on egregious fault. The majority reasons that, despite the court's protective power, "there remains significant potential for abuse and harassment as a result of such discovery" (maj. opn. at 7). However, considerations of abuse and harassment may be found in any contentious litigation. Further, fault is almost always an issue in a matrimonial case as a finding of fault or the living apart of the spouses are the only grounds for divorce in New York. Matrimonial cases often involve issues of a sensitive nature, and courts are well equipped to deal with the potential problems associated with them. Thus, disclosure should be permitted with restrictions imposed on a case-by-case basis, when problems peculiar to the particular case arise (see Connors, Practice Commentaries, McKinney's Cons Laws of NY, C3101:15 [noting that CPLR 3101 [a] permits courts to restrict disclosure in specific cases where problems exist]).

Further, the majority believes there is a "possibility that parties will be induced to enter into disadvantageous settlements rather than litigate these types of intensely personal issues." At least one matrimonial scholar disagrees: "Often, the pretrial examination can motivate settlement and avoid the far more bitter confrontation of the parties at trial, thereby paving the way for more harmonious post-divorce relationships. In any event, there would appear to be no valid reason to force matrimonial litigants to trial with less opportunity for disclosure and preparation than in any other civil action" (2 New York Matrimonial Law and Practice §16:29).

Assuming wife moved for a protective order limiting husband's discovery on the issue of fault, I think the issue would be close. While adultery has generally been held not to be an act so egregious as to become a factor to be considered when distributing marital property, it may be a factor if it amounts to "egregious" misconduct. Here, wife not only committed adultery on more than one occasion, she also had a child out of wedlock and deceived both husband and child as to that child's birth parent. In my view, it is premature without additional discovery to conclude at this junction that wife's misconduct is not so egregious to warrant consideration for purposes of the Domestic Relations Law.

♦

Order affirmed, with costs, and certified question answered in the affirmative. Opinion by Chief Judge Lippman. Judges Ciparick, Graffeo, Read, Smith and Jones concur. Judge Pigott dissents in an opinion.

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April 29, 2010

Sandra Bullock and Jesse James’ Divorce Begets the Issue of Child Custody

Posted By Brian D. Perskin

Sandra Bullock has filed for divorce from her husband Jesse James, which raises an important question: What about the children?

The divorce is complicated because of the issue of child custody and visitation regarding the three children James and Bullock have from James' first marriage. Bullock has a major caretaking role with them. Bullock also has a three-and-a-half month old adopted son, Louis. Joanna Grossman of Findlaw delves into the case of Sunny, the youngest, with whom Bullock has formed a maternal relationship since her birth in 2004:

As Sunny's stepmother, Bullock is neither a legal parent, nor a co-custodian... And a stepmother, for the most part, suffers the same fate with respect to a stepchild, when she divorces the child's legal parent: After the divorce, she is generally a legal stranger to the child. Fortunately, in California - as I explain below - that is not quite the case...The distinction between legal parents and legal strangers is paramount in determining the rights various adults have with respect to the care, custody, and visitation of children. A battle for custody between two legal parents, neither of whom has been declared legally unfit, is straightforwardly about the best interests of the child. The court asks: Given a variety of factors, which parent is best suited to have custody? But a battle between a parent and a non-parent is completely different.

It is virtually impossible for a non-parent to successfully obtain legal custody of a child who has at least one fit parent. Visitation is sometimes possible - but may be hard to come by.

The leading ruling on visitation was handed down in 2000 by the U.S. Supreme Court in Troxel v. Granville. That case concerned a Washington State law that allowed any third party to petition for visitation with a child at any time. It also permitted courts to grant such petitions over parental objection as long as it was in the best interests of the child. (The statute was not limited to any special situations - such as where one parent had been declared unfit or was divorced or widowed.)

In Troxel, a father had committed suicide, and a court had imposed a very expansive visitation schedule for his parents - the children's paternal grandparents - to see their grandchildren. However, the mother objected to the schedule. The Court held that, as applied in this case, the statute was unconstitutional. It cited the substantive due process right of parents to make decisions regarding the care, custody, and control of their children unless they have been declared unfit: The law must presume that fit parents act in the best interests of their children and give "special weight" to their decisions about, among other things, who should be able to spend time with their children.

In the wake of Troxel, many state courts have ruled on the validity of their respective third-party visitation statutes. As I have discussed in previous columns (here and here), many – but not all – such statutes survived review. Those that survived built in a strong preference for deferring to a legal parent's decision about visitation with third parties.

In California, where Bullock and James live, the state's highest court upheld the state's grandparent visitation law, in In re Marriage of Harris, against a Troxel challenge. (I discussed the ruling in a previous column.) Importantly, the statute requires that courts apply a rebuttable presumption that visitation with a third-party over the objection of a legal parent is not in the best interests of the child. It also requires proof of a pre-existing bond between grandparent and grandchild as a prerequisite to an order of visitation.

These two features of the statute seem to honor the constitutional protection for parental rights that was emphasized by the Supreme Court in Troxel. Thus, the California Supreme Court likely made the right call in upholding the statute.,, This visitation, however, may not be ordered if it would "conflict with a right of custody or visitation of a birth parent who is not a party to the proceeding."... Broader relationships between stepparents and stepchildren after a divorce tend to be the product of mutual agreement, rather than court order. So ironically, attempting civil or even friendly relationships with James and Lindemulder [the biological mother] might be Bullock's best chance to maximize her visitation with Sunny... The bottom line: Sandra Bullock has an uphill battle if would like to divorce James and maintain a parental-type relationship with Sunny. While court-ordered visitation is possible – and on the facts, I think, even probable – Bullock may not legally be able to regain the kind of relationship she has had with Sunny without Lindemulder's and/or James's consent.

Another issue is the custody of Louis, the 4-month-old son Bullock has just adopted. Joanna Molloy of USA Today writes:

In almost every case of adoption of a newborn in this country today, the new parent is chosen by the birth parent," says Adam Pertman, executive director of the Evan B. Donaldson Adoption Institute. And though most birth parents probably would choose a married couple, Pertman says, many types of families are chosen for adoption today, and divorce may not signal the end of an adoption process.

"For almost all states, the standard is: Is the adoption in the best interests of the child?" says Bonnie Rabin, a New York trial lawyer with experience in adoption cases. Considering the tabloid and entertainment magazine reports of infidelity by Jesse James, "it's unlikely the court is going to find that anyone other than (Bullock) doing it alone would be in the child's best interest."

The lag between baby Louis' arrival in the Bullock household in January and Wednesday's announcement is common, Rabin says: Courts want to study the child in the custody of the person or family seeking to adopt. The length of time between guardianship and final adoption varies according to state and adoption type.

All these machinations being kept under wraps for so long is "extraordinary," Rabin says. Bullock "must have so many people around her who wanted to make sure this adoption could go through without a lot of drama."

It is important to hire a lawyer who stays up to date on the latest developments in the law. For further information about The Law Offices of Brian D. Perskin please click here.

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February 16, 2010

Man Faces Jail Time for Taking Daughter to Church

Posted By Brian D. Perskin

According to an ABC News report , a veteran of the war in Afghanistan could find out today if he'll get jail time for taking his daughter to church in defiance of a Chicago family court order obtained by his estranged wife.

The two are in a bitter divorce battle, and the question of what faith their child should be raised in is pushing the boundaries of child custody arrangements.

Reyes' decision to baptize his daughter without his wife's permission resulted in what some are calling an extraordinary court order: The Hon. Edward R. Jordan in the Circuit Court of Cook County, Ill., imposed a 30-day restraining order forbidding Joseph Reyes from, according to the document, "exposing his daughter to any other religion than the Jewish religion."

The couple married in 2004. Joseph Reyes was Catholic, but he converted to Judaism -- he said the decision wasn't "voluntary" -- to please his in-laws.

Despite his conversion, Reyes, 35, said he never stopped practicing Catholicism.

Man Baptized Daughter Without Informing Estranged Wife

When the marriage fell apart, Rebecca Reyes, 34, got custody of their daughter. The girl, now 3, has been raised Jewish and attended a Jewish preschool.

Her father decided to baptize his daughter without consulting his wife.

Joseph Reyes sent his wife pictures and an e-mail documenting the occasion. Rebecca Reyes responded by filing for the temporary restraining order, which the judge granted.

Stephen Lake, Rebecca Reyes' attorney, said his client was shocked at her estranged husband's actions.

"Number one, it wasn't just a religious thing per se, it was the idea that he would suddenly, out of nowhere without any discussion and have the girl baptized," Lake said. "She looked at it as basically an assault on her little girl."

Furthermore, Joseph Reyes had never been a particularly devout Christian, Lake added.

When the girl's father took her to church again -- in violation of the order, he called the media to witness the event.

A court could rule today on whether Reyes should be jailed for criminal contempt, but he contends he did nothing wrong. He is moving to have the judge removed.

"Going to church, I don't think I violated the order," he told "Good Morning America." "In terms of Judaism, based on the information I was given, Catholicism falls right under the umbrella of Judaism."

Woman's Lawyer Accuses Reyes of 'Power Play' With Baptism

In a YouTube video of the subsequent visit to church, Joseph Reyes says, "I am taking her to hear the teachings of perhaps the most prominent Jewish rabbi in the history of this great planet of ours."

Lake, Rebecca Reyes' attorney, said Joseph Reyes had never been a particularly devout Christian.

"This was just something that he knew was going to have a negative effect on [Rebecca Reyes], and I think that's why he did it," Lake said, speaking of Reyes' church visits with the little girl.

"I think he was just trying to exert some power," Lake said.

But Reyes, who is studying law, said he only wants to be a good father to his daughter and expose her to his faith. That's something the courts usually allow in divorce cases, experts say.

Eugene Volokh, a professor at the UCLA School of Law, said a parent who has visitation rights "usually has the right to expose the child to his religious beliefs, teach the child his religion, to take the child to religious services, unless there seems to be likely psychological or physical harm stemming from that exposure."

Family court law expert Lynne Gold-Bikin said Reyes should have followed the court order, but also said, "If this couple made an agreement about what religion to raise their child, then it's an inappropriate order."

Reyes: Conversion Wasn't 'Voluntary'

Reyes said his faith is important to him.

Explaining his conversion, he said, "I did it because, one, my mother- and father-in-law would not accept me any other way and two, because they would not accept me, it was putting a lot of burden on the marriage."

While he acknowledged that his actions -- flouting the court order and involving the media -- didn't help to end the conflict, he said he has to take a stand.

"I've made every concession that I possibly can make for Rebecca, and I have to draw the line in the sand somewhere and this is where I choose to draw it," he said.

It is important to hire a lawyer who stays up to date on the latest developments in the law. For further information about The Law Offices of Brian D. Perskin please click here.

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February 05, 2010

Have a Divorce Pending? Hire a Private Investigator Says the Court!!!

Posted By Brian D. Perskin

In the decision below the court found that a husband hiring a private investigator to follow the wife and document her proclivities did not constitute harassment. The husband had a legitimate right to prepare his defense and his counterclaim. This was despite a restraining order that the wife had against the husband. This decision effectively sanctions hiring personal investigators to follow spouses in marital disputes.

Anonymous v. Anonymous, xxxxx

Supreme Court, Orange County

Justice Debra J. Kiedaisch

Decided: Jan. 27, 2010

The respondent husband has brought a motion for summary

judgment1 dismissing the wife’s petition which alleged the

husband violated an order of protection entered on February

26, 2009 pursuant to a settlement stipulation in Family Court.

The order of protection, entered without any finding of fault

against the husband, directs him to refrain from committing a

family offense or criminal offense against the wife and to stay at

least 1000 feet away from the residence and place of employment

of the wife except for court-ordered child visitation or to

attend church services on Sundays. The wife’s violation petition,

supplemented by her affidavits filed on this motion, allege

the husband retained a private investigator who recorded

on DVD the wife entering a motel and having an affair with

one Father L., a priest assigned to the Church, where the wife

was employed. The wife alleges the husband furnished the

DVD to her superiors at the Church resulting in the wife being

forced to resign. The wife contends, in effect, there was no

legitimate purpose in the husband having her followed by a

private detective and delivering the DVD to Church officials

and that doing so was intended by the husband to cause her to

lose her employment and cause her personal humiliation and

suffering. The wife claims such conduct constitutes a violation

of the February 26, 2009 order of protection2. On November 10,

2008 the wife had filed a divorce action against the husband

which has also been assigned to the undersigned in the IDV

Part, Supreme Court. On or about January 15, 2009, the husband

filed an answer and counterclaims for divorce against the wife

alleging the wife was having sexual relations with a certain

individual. Subsequently, on or about November 5, 2009, the

husband filed a motion in the matrimonial action to amend

his answer and counterclaims alleging the wife was committing

adultery with Father L.3 In opposition to the husband’s

motion to dismiss the petition the wife’s attorney alleges the

husband hired the private detective after he filed his answer

and counterclaims in the divorce action. The wife’s attorney

contends the husband was not legally bound to turn over

the DVD to Church officials. The wife’s attorney contends the

husband violated the order of protection by acting through

an agent, the private detective he hired, to follow and record

the wife’s activities, and then turning over the DVD to the

church causing the wife to lose her employment.

On this summary judgment motion, it is not disputed the

wife was having an affair with Father L. The investigator avers

he gave his report, photos, and DVD proving such affair only

to the husband in August, 2009. The husband averred Father

L. routinely administered Sunday mass to the husband, the

wife, and their child while they attended church, together,

and continued to do so on two occasions in September, 2009

after the husband learned of their relationship. The husband

avers he was so upset that it was Father L. who was administering

mass to him and his family that he returned the host

to another priest, Father A., explaining why he could not

accept communion from Father L. The husband states that

in his anguish he told Father A. of the photos. The husband

states he pleaded with Father A. not to tell Father B., who is

Father’s A.’s superior, as the husband did not want a scandal

and did not want to embarrass his child. The husband states

he reluctantly agreed at the insistence of Father A. to discuss

the matter with Father B. upon Father A. explaining it was

Father B.’s duty to investigate the matter and take appropriate

action. The husband states Father B. came to the husband’s

house on or about September 2, 2009 to discuss the matter

and at the request of Father B. the husband gave him a copy

of the DVD obtained from the investigator.

If the proponent of a summary judgment motion to dismiss

the petition establishes a prima facie entitlement to judgment

as a matter of law, the petition must be dismissed upon

the failure of petitioner to raise a triable issue of fact which

would preclude such judgment (Alvarez v. Prospect Hosp., 68

NY2d 320; Jackson v. New York University Downtown Hosp,

__ N.Y.S.2d__, 2010 WL 190294, N.Y.A.D. 2 Dept., 2010.) Generally,

a party bound to obey an order enjoining the party from

committing certain acts or conduct may be guilty of contempt

of such order by abetting others to violate the order without

the party personally violating the order directly (Mayor of City

of New York v. New York & S.I. Ferry Co., 64 N.Y. 622). A person

bound by the injunction may not hire others to do what he

or she may not do and evade the injunction by connivance

(Neale v. Osborne, 15 How.Pr. 81). In Leggio v. Leggio, 190

Misc 2d 571, the respondent was ordered to stay away from

the petitioner’s residence. The respondent enlisted persons

to enter the residence and remove petitioner’s property. The

court held that respondent violated the order of protection

by enlisting other persons to act on his behalf to commit acts

he was proscribed from committing. The court in Leggio, in

effect, found that enlisting others to enter the petitioner’s

residence and remove her property constituted an unlawful

intrusion upon the rights secured to petitioner by the order of

protection for which the respondent could be held in contempt

(Samuksnis v. Priest, 21 AD3d 3814).

It was not improper, per se, for the husband to retain the

services of a private investigator. The hiring of a professional

licensed private investigator in a matrimonial action to gather

evidence is for a proper and legitimate purpose. No case is

brought to the attention of the court in which the hiring of a

private investigator for such purpose has been held, per se,

to be a criminal act including harassment or stalking in violation

of the Penal Law (Penal Law 240.26; Penal Law 120.45).

The husband had the right to gather evidence up to the date

of trial in defense of the matrimonial action and in support

of his own counterclaims. The husband was not required to

accept that the wife had necessarily ceased her extramarital

affair merely upon her assurance to him that she had. In

fact, such representation proved to be false as the wife does

not controvert that the private investigator disclosed as the

result of his investigation that she was continuing to have an

affair with Father L. Under the circumstances, the hiring of

the private investigator, in and of itself, was not an unlawful

intrusion upon the rights of the wife secured by the order or

protection (Samuksnis v. Priest, 21 AD3d 381).

The next inquiry is whether delivering the DVD to the Church

officials, which was not necessary for the husband to defend or

prosecute the divorce action, raises a triable issue of fact that

the husband in having the wife followed and recorded by a

private investigator intended to inflict emotional and financial

harm upon the wife which might constitute a violation of the

order of protection. Although harassment in the second degree

often involves conduct which places a person in fear of their

physical safety, the language of the statute does not limit itself

to only physical threats (Penal Law 240.26). If the husband had

the wife followed and recorded by a private investigator for

the purpose of gathering embarrassing material to deliver

to her employer with the intention to cause her to lose her

employment such might qualify as conduct which alarms or

seriously annoys another person, and serves no legitimate

purpose, constituting harassment in the second degree (Penal

Law 240.26[3]). In Eck v. Eck, 44 AD3d 1168, the conduct complained

of as constituting harassment in the second degree

consisted of respondent making disparaging remarks and

accusations concerning petitioner to petitioner’s employer.

The appellate court in affirming the dismissal of the petition

stated it did so in deference to the Family Court’s credibility

determinations that the proven conduct did not support a finding

of harassment in the second degree. The appellate court did

not expressly rule that communications to the other person’s

employer calculated to cause that person to be terminated from

employment could not as a matter of law constitute harassment,

if sufficiently proved. However, it is uncontroverted in

this case that Father L. continued to administer communion

to the husband, the wife, and the parties’ child on Sundays,

after the affair became known to the husband. Under such

circumstances, the husband has prima facie demonstrated

a legitimate and justifiable purpose in communicating with

Church officials about the relationship between his wife and

Father L. The husband avers he resisted turning over the DVD

to Church officials fearing it would embarrass the parties’ child,

but that Father A. and his superior, Father B., prevailed upon the

husband to do so. Such averment that Church officials pressed

to receive the DVD appears credible as it would be expected

that Church officials would seek to obtain definitive proof, if

it existed, concerning allegations that one of their priests was

committing adultery with a Church employee, who was also

the wife of a parishioner. Such conduct, if true, would be of

moral and ethical concern to the Church officials as well as

engendering a risk of exposing the Church to potential litigation

and liability. The averments by the husband concerning how

the turnover of the DVD occurred are not based on evidence

exclusively within the husband’s knowledge. There are other

witnesses to such conversations concerning how the DVD

came to be given to Father B., namely, Father A. and Father

B. The wife makes no request for discovery or depositions of

such witnesses prior to determination of this summary judgment

motion or articulates any basis for concluding that such

discovery would yield different evidence (Pistolese v. William

Floyd Union Free Dist., __ N.Y.S. 2d__, 2010 WL 187702, N.Y.A.D.

2 Dept., 2010; Stagg v. City of New York, 39 AD3d 533).

The husband in his motion papers has prima facie demonstrated

his entitlement to summary judgment dismissing the

petition by evidence showing he did not retain the private

investigator for an improper or illegitimate purpose such as

harassment or stalking under the Penal Law or intend to make

improper use of the private investigator’s work product DVD.

Upon the failure of the wife to demonstrate the existence of

a triable issue of fact that the husband committed a crime or

family offense against her or otherwise violated the order of

protection, summary judgment dismissing the petition should

be granted.

Accordingly, it is hereby

ORDERED that the petition and above captioned proceeding

are dismissed on the merits.

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February 04, 2010

Is Virtual Visitation an Option?

Posted By Brian D. Perskin

The issue of virtual visitation has entered the realm of custody rights and may have an effect on visitation arrangements. That effect may be extremely positive or negative depending on the relations between the parents. The reality is that communication vis-a-vis technology like instant messaging and video conferencing enables a divorced parent to connect with his or her child.

Just this month Illinois examined the issue. According to The Chicago Tribune:

Language added to an Illinois law this month includes virtual visitation among the rights of noncustodial parents, making it enforceable by a judge. According to the measure, parents are entitled to electronic visits unless the court believes that contact would be harmful to the child.

The visits can be made by telephone, e-mail, instant messaging and video conferencing. While some parents have long worked out such arrangements, the new language creates a legal right for cases when parents cannot agree. "We really want parents to be invested in the daily lives of children and this gives them another venue," said state Sen. Pamela J. Althoff, R-McHenry, who carried the bill after it was introduced by a former colleague.

The law is similar to a handful passed in other states over the last six years, according to David Meyer, associate dean at the University of Illinois College of Law.

Meyer said the extent of visitation rights is still for a judge to determine. "There's been some who have been wary of these laws either on the grounds that they will provide an excuse to bar in-person visitation or that they will be used to promote contact where it would not be good for children," Meyer said.

Larry Baum, 44, said texting has helped ease the stress of divorce for his 12-year-old daughter. Baum, a sales manager, lives just 15 minutes from his three children, so he sees them most evenings. Still, two years ago Baum began texting with his eldest, even though it's not part of a formal settlement.

"It helps a ton," Baum said. Because of the constant contact with both parents, "the fact that she's living in two houses is not stressful for her," he said.

While Baum has not needed video conferencing yet to keep up with his kids, he took the idea into consideration when he bought a new laptop — just in case he ever needs to travel more for work.

"I'm acutely aware of how stressful some situations might be for my kids. ... Being able to communicate instantly takes the stress out of it," Baum added.

Chicago family law attorney Jeffery Leving, who said he helped write and lobby for the changes to the law, said he hopes the changes help noncustodial fathers and open up opportunities for children to be in contact with incarcerated fathers.

"The electronic visitation — primarily the cell phone and now the computer — in my opinion, is a psychological lifeline for the child," said Leving, whose firm specializes in fathers' rights.

Bruce Boyer, director of the Loyola Civitas ChildLaw Clinic, said virtual visitation has been helpful in custody cases involving parents who are great distances from each other or in cases where a parent should not have physical proximity to his or her children but would still like to visit and have a relationship.

But, he cautioned, virtual visits should not take the place of in-person interaction whenever safe and possible. "It's a lesser alternative to face-to-face contact," Boyer said. "If you don't have a better alternative, it can be a very good way of maintaining contact."

Baddick and Isabella's mother divorced in 2003, and the father recalls the emptiness he felt when he first drove away from the family home. His daughter, he said, also remembers.

"It was horrible. It took me a while to get over it," he said. "I struggled for years and years."

But then the father and daughter adjusted, and in recent years, they discovered virtual visitation. In the Baddicks' case, the visits aren't part of an official custody agreement, but rather worked out informally between Isabella's parents.

Isabella likes the video phone. "It's really cool that you get to talk to your dad and see him," she said.

Baddick recently called his daughter on Skype, an application that allows people to talk and see each other at the same time, from his hotel room at the Hyatt Regency O' Hare where he was preparing to begin a weeklong meeting.

"How was school?" Baddick asked into the computer screen. After having trouble hearing his daughter, he put her on speaker from his cell phone but kept the video going so he could see her face. Baddick asked her which friends were coming over that night. She told him.

"You have to get your homework done first," Baddick reminded. Isabella told him that she planned to join the soccer team. She promised to send her father a picture of her new horse, Gretta. (A photo quickly arrived over his cell phone.)

Then Isabella said that her best friend was moving away because of her parents' divorce. "Like with me and Mommy, sometimes divorce happens," Baddick said. "It will be OK. You be strong."

Since Baddick remarried a Russian woman, Isabella and her father have a saying before they hang up: "Do svidaniia," goodbye in Russian. On this particular evening, they both said it. They said they loved each other. Then they hung up.

What about New York? Is the issue of virtual visitation addressed legally? The answer, in short, is yes and no. The Buffalo News sorts this out:

While nothing has been written into New York State law here, Emilio Colaiacovo, a matrimonial/family law attorney and partner with the Bouvier Partnership in Buffalo, says that virtual visitation “does occur here with greater frequency than I think people are aware of.”

Unlike Illinois, “parents do not have an affirmative, legal right for this by statute” in New York, said Colaiacovo. “But if the court believes the child would benefit from virtual visitation, the court will order that. I just finished a case where the parent lives in Austin, Texas, and the child lives in Buffalo,” and the court ordered that a Webcam and Internet access be installed and used for regular virtual visitation .

Even without “a statute that puts any teeth behind this,” said Colaiacovo, “the court, by virtue of its own decisions, can make this virtual visitation happen.”

Colaiacovo has had virtual visitation arranged in many cases where parents live in another city, including for one military parent who was deployed to Baghdad. “He needed to have that visual contact with the child, which is very important,” Colaiacovo said. “Where you have a noncustodial parent living out of the area, you see virtual visitation more often than not.”

In the 10 years he has been practicing family law, Colaiacovo says he has seen text-messaging access become as commonly mentioned as telephone access. “The Webcam stuff is new,” he says, “because now most computers come equipped with that technology. That’s new in the past two or three years.”

The Illinois law is similar to a handful passed in other states over the last six years, according to David Meyer, associate dean at the University of Illinois College of Law.

Meyer said the extent of visitation rights is still for a judge to determine.

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February 01, 2010

Fair Warning for those who Contribute Little to a Marriage

Posted By Brian D. Perskin

In the below decision from Suffolk County Supreme Court Justice Gargiulo denies equal distribution in a case where the wife contributed nothing to the economic partnership, neither through her work or her by contributing her own money. In this case the Judge found that the wife had been siphoning off company funds throughout the marriage. The Judge also denied counsel fees on the theory that it was plainly obvious that the wife was not entitled to the requested relief and as such the Judge would not grant counsel fees merely to allow the wife to play with "house money" in trying to receive a larger degree of equitable distribution. This warning is fair warning to those who put nothing into an economic partnership, but intend to take half of everything with them when they leave.

S v. S, 29475-2007
Decided: January 26, 2010

Justice Garguilo

This is an action for Absolute Divorce commenced by the plaintiff, A.S., against the defendant, E.S. The Court took testimony as to grounds and makes its findings hereinafter allowing divorce on the basis of constructive abandonment (DRL §170(2)). Thereafter, the trial was held before this Court ending on November 6, 2009.

The court has had a full opportunity to consider the evidence presented with respect to the issues in this proceeding including all the testimony offered and all exhibits received. Furthermore, the Court observed the demeanor of the witnesses and has made determinations concerning the credibility of these witnesses. The Court makes the following Findings of Fact and Conclusions of Law:

FINDINGS OF FACT:

A. GROUNDS:

1. The parties were married on August 7, 1999 within the State of New York.

2. The Action for Divorce was commenced on or about October 10, 2007.

3. The plaintiff-wife, at the time of trial, was 47 years old. The defendant-husband, at the time of trial, was 57 years old. The health of the parties is not in issue.

4. There are no children of the marriage. Both were previously divorced and do have children of their prior marriages. In 2002, the plaintiff had commenced an action for divorce which was discontinued.

5. At the time of the commencement of this action, both plaintiff and defendant were residents of the State of New York and both had prior thereto continuously resided in the State of New York for a period in excess of two years. Neither the plaintiff nor the defendant are in the military service of the United States, and there is no judgment or decree of divorce, separation or annulment granted with respect to this marriage by this Court or any other court of competent jurisdiction and no other actions are pending at the present time.

6. Both parties agree to take, prior to the entry of a filed Judgment, all steps solely within their power to remove any barrier to the other's remarriage following divorce. The Court finds it has jurisdiction of the parties and the subject matter.

7. The Court finds that the defendant knowingly, intelligently and voluntarily constructively abandoned the plaintiff with respect to the grounds alleged by the plaintiff in her Verified Complaint. The Court finds credible the testimony of the plaintiff that since on or about March, 2006, and continuing, the defendant, without just cause or provocation, willfully refused to co-habit with the plaintiff as man and wife and to have normal sexual relations with the plaintiff, despite plaintiff's repeated requests of the defendant to resume normal sexual relations. Both plaintiff and defendant are physically capable of engaging in same and neither party suffers from any physical or mental disability which would preclude marital relations. The Court finds that said refusal has been continuous, unjustified and unprovoked. Consequently, the plaintiff proved, and the Court finds as fact, those allegations as set forth in paragraphs Eighth, Ninth and Tenth of her Verified Complaint dated April 20, 2009. Oral applications to conform the pleadings to the proofs were granted. The defendant has neither admitted and/or denied the allegations.

B. DISPOSITION OF PROPERTY:

8. Marital property is defined in Domestic Relations Law §236B(1)(c) as "All property acquired by either or both spouses during the marriage." The issues both prosecuted and defended by the parties, in large measure, concern the identity of the property (marital vs. separate) and the relative share of each party.

The following are the properties at issue:

a) 3 Frances Lane, Port Jefferson, New York (the marital residence).

b) Home Companion Services of New York, Inc. ¹

c) Home Companion Services of Florida, Inc.

d) Access Home Care, Inc.

e) Arcadia Management, Inc.

f) Green Fields East Holding, LLC.

g) Janney Montgomery Scott accounts:

i. XXXX-0213

ii. XXXX-0116 (529 Plan)

iii. XXXX-0170 (Roth IRA)

iv. XXXX-0045

v. XXXX-2840 (profit sharing)

vi. Arcadia Management (401K)

h) HSBC Accounts:

923XXXXXX

253XXXXXX

I) ING Account:

73322014

j) Time Shares:

I. Manhattan Club

ii. Bahamas

k) Vehicles:

I. 2003 Nissan

ii. 2009 Nissan X-terra

iii. Mercedes-Benz (leased)

DISCUSSION

The plaintiff seeks a 50 percent share of the marital portion of all the business interests in accordance with the stipulated values determined by the neutral appraiser. As to the marital residence, the plaintiff seeks a 50 percent share of its value in accordance with the stipulated value determined by the neutral appraiser and exclusive occupancy of said residence until such time as the home is sold. Additionally, plaintiff seeks a 50 percent share of all retirement accounts and all the other enumerated funds. Green Fields East Holding, LLC controls defendant's share of realty located in Aquebogue, New York. The plaintiff is seeking a 50 percent share "of the equity in the property located in Aquebogue, in accordance with the stipulated value determined by the neutral appraiser." The plaintiff seeks title to the Bahamas time share as well as a distributive award and/or credit in the sum of $11,500 representing the balance of her claimed 50 percent share in the two marital time share units. Lastly, the plaintiff seeks exclusive title and possession of the 2003 Nissan vehicle.

The defendant does not suggest any percentage as concerns the distributive award aspects of the case. However, the defendant, in his post-trial memorandum, suggests "plaintiff herein was clearly not a contributing member of an economic partnership with defendant." In stark contrast, the plaintiff, in her post-trial memorandum, characterizes her contributions in phrases such as "the expansive nature of her ongoing contributions is clear;" "her direct and daily involvement in the business…vast indirect contributions;" "Allison's (plaintiff) significant direct and indirect contributions to the success and viability of the businesses;" and, "significant and unquestioned contributions to her husband and the businesses."

The Domestic Relations Law contemplates an equitable division of assets based upon the parties' respective contributions to the marriage (see, Domestic Relations Law §236(B)(5)(d)(6)). The distribution of the assets depends not only on the financial contributions of the parties, "but also on a wide range of non-remunerated services to the joint enterprise, such as homemaking, raising children and providing the emotional and moral support necessary to sustain the other spouse in coping with the vicissitudes of life outside the home," (Price v. Price, 69 NY2d 8, 14 [1986]).

The Court has considered the marital history and will enumerate the factors considered in arriving at an equitable distribution of marital property (DRL §236(B)(5)(d)). At the time of the marriage, the defendant was (and currently remains) the driving, tireless source of the success of the business interests. He came to the marriage as a responsible entrepreneur earning a handsome living. The plaintiff came into the marriage with poor credit. This is borne out as the trial testimony indicated that the marital home, purchased days before the wedding, was purchased solely with defendant's money. The plaintiff could not participate in the purchase as she had bad credit. The record is quite clear that the plaintiff offered virtually nothing to enhance the growth of the business interests and/or the accumulation of additional assets.

The marriage, as noted earlier, was the second marriage of both parties. This marriage is of relatively short duration as the wedding occurred on August 7, 1999 and the action commenced in October of 2007.

There being no children of the marriage, the issue of a "custodial parents [need] to occupy or own the marital residence and to use or own its household effects," is not a consideration.

Neither party offered evidence reflecting DRL §236(B) (5) (d)(4), (7), (9), (10) or (12). Nonetheless, the Court does note that liquidity issues (DRL §236(B)(5)(d)(7) pose no compelling considerations.

Pursuant to DRL §236(B)(5)(d)(13), the Court may consider "any other factor which the court shall expressly find to be just and proper." Given the credible testimony of the non-party witnesses, it is an affront to the sensibilities of the finder of fact to suggest the plaintiff to be or have been anything but a consumer, user and abuser of her status as the boss's wife. To claim the plaintiff to be an element in any way responsible for the defendant's success in business and/or investments is equally an affront. The plaintiff has not demonstrated to any degree the contribution of non-remunerated services to the joint enterprises.

During the course of this short, rocky relationship, nothing tied the plaintiff to the marital home. There is no rearing of children, maintaining the marital abode and/or active participation in fostering the growth of defendant's enterprises. At the time the plaintiff took employment with her husband's companies, she abused her stature as the boss's wife. She came and went as she pleased and neglected accounts, costing the business dearly. She engaged in self-dealing by secretly siphoning money.

On the home front, she allowed her sons from a prior marriage to run amok, damage, soil and show no respect for the defendant's proprietary rights. In short, to suggest any kind of symbiosis between the plaintiff and defendant is sheer fiction. The plaintiff's presence, as suggested by the record, was parasitic.

It is elementary that equitable distribution does not necessarily mean equal distribution, Rizutto v. Rizutto, 250 AD2d 892 (1998). Equitable distribution presents issues of fact which the Court must resolve,Teabout v. Teabout, 269 AD2d 719 (2000). In partitioning property, the Court should consider the separate contributions of each party to the acquisition and improvement of the property, Quattrone v. Quattrone, 210 AD2d 306 (1996). The Court must also consider the parties' respective contributions to the family economic enterprise, Johnson v. Johnson, 49 AD2d 348 (2008).

THE MARITAL RESIDENCE

The marital residence at 3 Frances Lane, Port Jefferson, New York was purchased by the defendant prior to the marriage (August 5, 1999). The purchase price was $425,000. The sum of $145,000 came directly from proceeds of a sale of defendant's condominium. The home, upon closing, was encumbered with a $280,000 mortgage solely in defendant's name. The plaintiff did not contribute money to the acquisition of the home.

During March of 2005, the defendant conveyed his interest in the marital home to himself and the plaintiff as tenants by the entirety. There was no consideration for the transfer.

The neutral appraiser, Given Associates, valued the residence at the time of the transfer at $900,000. Shortly before commencement of this trial, the neutral appraiser determined the value of the premises to be $765,000. The marital residence declined in value by $135,000 from conveyance to trial. The sum of $40,000 paid for improvements is reflective of improvements made wholly with funds supplied by the defendant. Those funds came from his income earned post marriage. The record is further clear that all funds to carry the home were derived from defendant's self employment.

The plaintiff seeks 50 percent distribution of the net value after crediting defendant with the sum he actually spent to take possession of the house ($145,000) citing Coffey v. Coffey, 119AD2d 620 (2nd Dept.1986). The Court deciding Coffey in remanding the matter to determine the increase in value from the date the transferring spouse acquired the separate property to the date of transfer to his spouse clearly found the pre-transfer appreciation to be relevant. Why so? The Court noted:

At the outset, it is important to note that there is no requirement that distribution of each item of marital property be on an equal basis (see, Arvantides v. Arvantides, 64 NY2d 1033, 1034; Parsons v. Parsons, supra.; Ackley v. Ackley, supra.; Rodgers v. Rodgers, 98 AD2d 386, 390-391, appeal dismissed 62 NY2d 646). Rather, property acquired during the marriage should be distributed "in a manner which reflects the individual needs and circumstances of the parties" (mem of Governor Carey, 1980 McKinney's Session Laws of NY, at 1863). To this end, courts possess the flexibility required to mold a decree appropriate to a given situation, with fairness being the ultimate goal (see, Rodgers v. Rodgers, supra., at p 391).

The court went on to further comment:

In accordance with these principles, in the case at bar, the husband should receive a credit for the contribution of his separate property toward the creation of the marital assets (see, Parsons v. Parsons, 101 AD2d 1017; Duffy v. Duffy, 94 AD2d 711; Domestic Relations Law §236(B)(5)(d)(10)).

The Coffey court noted that the record was "devoid of evidence of the value of the marital residence at the time of the 1973 conveyance." The 1973 conveyance was the one that created marital property as the husband deeded the property to himself and his wife as tenants by the entirety.

The matter before this Court suffers no lack of evidence similar to Coffey. As noted earlier, the property was acquired, pre-marriage, separately. It was valued at $425,000. At the time of the conveyance to plaintiff, it was valued at $900,000. At or near the time of trial, it was valued at $765,000. As a finding, the Court concludes that the value of the marital residence declined $135,000 during its tenure as marital property. Worthy of note is the fact that the defendant-husband paid virtually all carrying charges on the home from his earned income.

The logic of the Coffey court in holding that the grantor spouse should "receive a credit for the contribution of his separate property toward the creation of the marital assets" and thereafter remanding the matter to take "evidence of the value of the marital residence at the time of the conveyance" compels this Court to find the defendant-husband's contribution of his separate property is $900,000. As the asset depreciated, the plaintiff is ORDERED to execute a quit claim deed (without any payment from the defendant) transferring her interest in the marital premises to the defendant-husband, fee simple absolute.

In deciding this case, the Court referenced Granade-Bastuck v. Bastuck, 249 AD2d 444, 671 NYS2d 512(App. Div. 2d Dept., 1998). A prime consideration of that court in sustaining a 50 percent award of the husband's non-business properties was that the wife made non-economic contributions to the marriage which allowed the couple to "amass a substantial marital estate." No such contributions were made by the plaintiff herein.

The marital home herein was improved by construction projects. Those improvements are incorporated into the appraisal of the home and the funds were derived wholly from defendant-husband's post-marriage income. The defendant-husband is directed to pay to plaintiff the sum of $10,000 representing a distributive award concerning the improvements. Both the quit claim deed and payment of funds shall occur within thirty (30) days of service of a copy of the decision and order with notice of entry. The plaintiff is ORDERED to vacate the premises no later than thirty (30) days after service of a copy of the decision and order with notice of entry.

BUSINESS INTERESTS

The plaintiff seeks a 50 percent share (distributive award) of the marital value of her husband's business interests. Plaintiff claims such an award:

"[i]s appropriate, given the magnitude of her contributions, and the manner in which her labor, services and indirect contributions helped grow the business into the successful enterprise it is today."

The record supports an extremely different scenario. Testimony of Susan Farrar (an employee of the defendant) was credible. She has been an employee of the defendant for approximately twenty (20) years. The witness testified that the labor, marketing and networking skills of the defendant transformed his chiropractic practice into a thriving home companion business. The plaintiff, herself, acknowledged Home Companion Services of New York was conceived through defendant's insight. Testimony of S F and D K, another employee, demonstrated that the plaintiff engaged in affirmative bad acts in drawing checks payable to cash and deleting same from the operating account register to avoid detection. Plaintiff's assertion that same was done with the consent of the defendant is patently incredulous. Why would the defendant, the boss, encourage his wife to write checks to cash and delete same from the register? Perhaps to give his auditors something else to do?

Financial Appraisal Services, Ltd., the neutral, court-ordered forensic accountant, found an appreciation of $1,146,000.00 of Home Companion Services of New York during the marriage. The company was founded three (3) years before the marriage. The plaintiff's contributions to the growth of that entity is undetectable. It is the decision of the Court that plaintiff's distributive award of the business entities is zero dollars. As noted earlier, the plaintiff's cavalier approach to work attendance, misfeasance, malfeasance and disruptive nature substantiate the finding herein consistent with Granade-Bastuck v. Bastuck (249 AD2d 444) in correlating a distributive award to the party's non-economic contributions to the marriage which allowed the couple to "amass a substantial marital estate."

The Court's determination concerning business interests applies to those entities noted herein at B, (b), (c), (d), (e) and (f).

INVESTMENT PORTFOLIOS

Several investment portfolios and bank accounts were the subject of the distribution claims. The testimony remains uncontroverted that all monies represented by the accounts came from income generated by the husband. However, a good deal of said income was earned during the marriage. That income used to fund the investment vehicles is marital property.

The plaintiff seeks a 50 percent distributive award of all the funds. The defendant concedes a distribution "consistent with the respective financial contributions of the parties."

Clearly the plaintiff made no financial contributions to these accounts. However, it is clear that monies represented in the accounts are a marital asset as that term is defined. The Court awards the plaintiff as follows:

J M S accounts:

1. XXXX-0213—10 percent of the value at the date of commencement of this action.

2. XXXX-0116 (529 Plan)—0 percent

3. XXXX-0170 (Roth IRA)—10 percent of the value at the date of the commencement of this action.

4. XXXX-0045—10 percent of the value at the date of commencement of this action.

5. XXXX-2840 (profit sharing)—10 percent of the value at the date of commencement of this action after crediting the defendant $32,719.59. The Court has carved out that sum as the defendant's separate property, the sum of $32,719.59 being defendant's monies in the Janney accounts pre-marriage and therefore separate property.

6. Arcadia Management (401K)—10 percent of the value at date of commencement of this action.

The accounts with HSBC and ING are marital property. The plaintiff shall receive as her distributive award 10 percent of the value of each account at the date of commencement.

In awarding the plaintiff a portion of the accounts, the court has given weight to her testimony concerning some domestic responsibilities assumed during the marriage. The plaintiff testified working with decorators involving drapery, the living room, painting, carpeting and bedding (pillows). Additionally, the plaintiff offered testimony concerning her work in cleaning the home as well as serving breakfast and dinners. The Court, in seeking equity, despite all else, chose to credit plaintiff for her services.

The two time shares will be sold. The proceeds shall be divided 10 percent to the plaintiff, 90 percent to the defendant. In lieu of sale, either party may buy the other's interest at a gross valuation of $30,000 (Manhattan Club) and $7,000 (Bahamas). More particularly, the defendant may buy out the plaintiff by tendering 10 percent of the gross values as set forth hereinabove.

The plaintiff is awarded the 2003 Nissan motor vehicle. All other vehicles are awarded to the defendant.

425 OLD TOWN ROAD PROPERTY

The real estate and building housing the defendant's business (425 Old Town Road, Port Jefferson Station, New York) was acquired by the defendant some ten (10) years before the marriage. It is separate property. The plaintiff offered no testimony concerning value, appreciation or the like. The property shall remain the defendant's separate property.

MAINTENANCE

The plaintiff is seeking an award of maintenance in the sum of $3,000 per week for a period of five (5) years. The defendant has been paying the plaintiff $500 per week in pendente lite spousal support, retroactive to October 16, 2007. The duration of this marriage is approximately eight (8) years.

Plaintiff cites Fuchs v. Fuchs, 276 AD2d 868, 714 NYS2d 381 in support of her claim. The marriage of Mr. and Mrs. Fuchs endured for thirty (30) years. They reared four (4) children. That court restated the accepted proposition that:

It is well settled that determination of whether one of the parties in a matrimonial action is entitled to maintenance and, if so, the amount to be awarded falls within the broad discretionary powers of Supreme Court (see, Domestic Relations Law §236[B][6][a]; Cohen v. Cohen, 154 AD2d 808, 809; Donnelly v. Donnelly, 144 AD2d 797, 798, appeal dismissed 73 NY2d 992).

The marriage before this Court is of a short duration. The plaintiff's contributions were at best de-minimus. Her acts of misfeasance and malfeasance have been addressed. She came into the marriage with "bad credit" and no testimony reflects any separate property except perhaps a child support entitlement from a prior marriage. She is currently under-employed and as noted hereinabove has received pendent lite spousal support for almost three (3) years. During that three (3) year period, the record is clear that the plaintiff has taken few steps to attain some form of self-sufficiency.

In lieu of any future maintenance, the defendant is directed to pay 50 percent of plaintiff's credit obligations, not to exceed $27,950. Said sum representing 50 percent of plaintiff's credit obligations on the date of commencement. In consideration of said payment, the defendant shall be discharged from any alleged arrears for unpaid medical bills limited to $1,000.

COUNSEL FEES

The plaintiff seeks a separate counsel fee award of $47,467.02. To date, defendant has paid $16,000 toward plaintiff's counsel fees.

In support of her application for counsel fees, plaintiff correctly points out:

Domestic Relations Law Section 237 expressly authorizes the award of legal fees. To discourage the use of litigation as a form of economic harassment, courts must grant reasonable and substantive awards of counsel fees that will reflect the current value of legal services, and the nature of the services that must be rendered.

The matter at bar presents itself as one where the plaintiff's demands for an equal distribution of all marital properties is preposterous. It is preposterous given the facts which were known to the parties going into trial. The defendant is successful. His properties are very valuable. Is the award of counsel fees in the best interest of all when it becomes apparent that a party's mind set is to proceed to trial and play with the "house's money"? In this case, the "house's money" is embodied in the prospect that win, lose or draw, we can count on Mr. S to pay his wife's cover charge.

The Court denies the plaintiff's fee application

It is, therefore, the ORDER of this Court that within thirty (30) days after service of a copy of this Order with Notice of Entry that:

1. The plaintiff will deliver a quit claim deed to the marital premises to the defendant and vacate the premises.

2. That the defendant will pay the plaintiff the sum of $10,000 representing marital property (money) paid for improvements of the marital home.

3. That all the business interests shall become the separate property of the defendant.

4. That the defendant shall tender the appropriate sums of money from the various retirement investment and bank accounts consistent with this decision.

5. That the defendant shall tender all documents necessary to transfer the 2003 Nissan vehicle to the plaintiff.

6. That the defendant shall tender the sums of money to the plaintiff to resolve the credit card obligations consistent with this decision.

Furthermore, the parties are directed to submit, on notice, proposed Judgments consistent with the Court's determination on or before MARCH 5, 2010.

The foregoing constitutes the ORDER of this Court.

1. Items (b) through (e) are collectively referred to as the "Business Interests."

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September 09, 2009

New Rule In Divorce Actions

Posted By Brian D. Perskin

New Rule In Divorce Actions

Recently a new rule has gone into effect for matrimonial cases. Starting September 1, 2009 automatic orders will now go into effect whenever someone is served with both a summons and a copy of the automatic orders. These automatic orders are largely concerned with preserving the status quo of the parties' finances. The orders are both relatively simple and at the same time encompass much of what could be done by one party to financially harm the other.

The orders are broken down into five sections; the first restricts a party from disposing of property in any way without the court's or parties' consent. The second restricts any funds, stocks or other assets from being disposed or altered. The third section prevents unreasonable debts from being incurred against the parties' interests or property. The fourth section mandates that all health insurance policies be maintained and unaltered for the parties and their families. The fifth section mandates that all life, home and auto insurance policies will be maintained and unaltered.

These automatic orders should lower the need for early motions to restrict such funds and property in divorce actions. They may also change the calculus for when a lawyer seeks to serve the summons and automatic orders. Below is the full text of the Amendment of the Rule.

AMENDMENT OF RULE

Uniform Civil Rules for the Supreme and County Courts

Pursuant to the authority vested in me, and with the advice and consent of the Administrative Board of the Courts, I hereby promulgate, effective September 1, 2009, new section 202.16-a of the Uniform Civil Rules for the Supreme and County Courts, relating to automatic orders in matrimonial actions, to read as follows:

Â§ 202.16-a Matrimonial Actions; Automatic Orders

(a) Applicability. This section shall be applicable to all matrimonial actions and proceedings in the Supreme Court authorized by section 236(2) of the Domestic Relations Law.

(b) Service. The plaintiff in a matrimonial action shall cause to be served upon the defendant, simultaneous with the service of the summons, a copy of the automatic orders set forth in this section in a notice that substantially conforms to the notice contained in Appendix F. The automatic orders shall be binding upon the plaintiff immediately upon filing of the summons, or summons and complaint, and upon the defendant immediately upon service of the automatic orders with the summons.

(1) Neither part shall sell, transfer, encumber, conceal, assign, remove or in any way dispose of, without the consent of the other party in writing, or by order of the court, any property (including, but not limited to, real estate, personal property, cash accounts, stocks, mutual funds, bank accounts, cars and boats) individually or jointly held by the parties, except in the usual course of business, for customary and usual household expenses or for reasonable attorney's fees in
connection with this action.

(2) Neither party shall transfer, encumber, assign, remove, withdraw or in any way dispose of any tax deferred funds, stocks or other assets held in any individual retirement accounts, 401K accounts, profit sharing plans, Keogh accounts, or any other pension or retirement account, and the parties shall further refrain from applying for or requesting the payment of retirement benefits or annuity payments of any kind, without the consent of the other party in writing, or
upon further order of the court.

(3) Neither party shall incur unreasonable debts hereafter, including but not limited to further borrowing against any credit line secured by the family residence, further encumbrancing any assets, or unreasonably using credit cards or cash advances against credit cards, except in the usual course of business or for customary or usual household expenses, or for reasonable attorney's fees in connection with this action.

(4) Neither party shall cause the other party or the children of the marriage to be removed from any existing medical, hospital and dental insurance coverage, and each party shall maintain the existing medical, hospital and dental insurance coverage in full force and effect.

(5) Neither party shall change the beneficiaries of any existing
life insurance policies, and each party shall maintain the existing life
insurance, automobile insurance, homeowners and renters insurance
policies in full force and effect.

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July 08, 2009

Dismissing Divorce Actions

Posted By Brian D. Perskin

There are generally two ways to start a divorce action, one is by Complaint and the other is by serving a Summons with Notice. One of the benefits of starting an action by serving a Summons with Notice is that according to CPLR Rule 3217(a)(1) a Summons with Notice can be discontinued at any time, without cause or judicial involvement. The case below affirms that notion and adds to it that even where their has been a stipulation that the divorce would be uncontested, that does not constitute ones waiver of their right to dismiss such an action at their discretion.

Ressa v. Ressa, 350291/06
Decided: November 8, 2007
Justice Jacqueline W. Silbermann

NEW YORK COUNTY
Supreme Court

Defendant brings two applications by Order to Show Cause: (1) to vacate the Notice of Discontinuance filed by the Plaintiff in this matrimonial action and for restoration of the case; and (2) for accountants, appraisers and counsel fees pursuant to DRL §237. The Plaintiff submitted papers opposing the motion to vacate the Notice of Discontinuance. In response to the fee application, the Plaintiff submitted a letter asserting that the motion for interim counsel and expert fees "should be marked as being disposed of as moot."1

The Motion to Vacate the Notice of Discontinuance

Defendant's motion to vacate the Notice of Discontinuance poses a novel question of first impression to this Court, that is: whether a stipulation made in a preliminary conference order, to the effect that the issue of fault is resolved and that the Defendant was entitled to take a divorce against the Plaintiff on the grounds of constructive abandonment, constitutes a waiver of the Plaintiff's right to discontinue the action pursuant to CPLR Rule 3217(a)(1), prior to service of pleadings.

This action was commenced by the filing of a Summons with Notice for a Divorce on May 16, 2006. No complaint was served either with the Summons with Notice or at any subsequent time. During the preliminary conference held on December 5, 2006, a preliminary conference order was negotiated between the parties which includes a stipulation that: "the Parties agree that Defendant shall proceed with [an] uncontested divorce against Plaintiff on the grounds of constructive abandonment". The signatures of each of the parties and their attorneys immediately follow that stipulation, on the same page of the preliminary conference order.

Some months after the preliminary conference, the Defendant made an application for pendente lite relief seeking over $300,000 as interim counsel fees, real estate appraisal fees and forensic accounting fees. That application was withdrawn and is now resubmitted. Shortly after receiving Defendant's fee application, the Plaintiff filed a Notice of Discontinuance pursuant to CPLR Rule 3217(a)(1). The Defendant seeks to vacate the discontinuance and to have the case restored.

In support of her motion, Defendant asserts that Plaintiff's stipulation, in the preliminary conference order, that "Defendant shall proceed with an uncontested divorce on the grounds of constructive abandonment," constitutes a binding waiver by Plaintiff of his right to discontinue the action pursuant to CPLR Rule 3217(a)(1). There is precedent for the enforcement of such a stipulation in Pappas v. Pappas, 294 A.D.2d 121, 171 N.Y.S.23d 404 (1st Dept' 2002), where the Appellate Division, First Department held that a stipulation to the effect that the issue of fault was resolved, was binding on a record showing that the Plaintiff had been represented by counsel who had clear authority to sign open-court stipulations, that the Plaintiff was present and participated in discussions on the resolution of the issue of fault at time the stipulation was made. Similarly, in the present case, the Plaintiff was present in court, with counsel, during the preliminary conference and both Plaintiff and his lawyer signed the page containing the stipulation indicating that fault was resolved. However, the Pappas decision does not address the present circumstance where a notice of discontinuance was filed after the stipulation waiving grounds for the divorce was made but prior to the service of a complaint.

The Plaintiff relies upon his absolute and unconditional right to discontinue the action prior to service of a complaint without seeking judicial permission, pursuant to CPLR Rule 3217(a)(1), as recognized by the Court of Appeals in Battaglia v. Battaglia, 59 N.Y.2d 778, 451 N.E.2d 472, 464 N.Y.S.2d 725 (1983). See also, McMahon v. McMahon, 279 A.D.2d 346,348, 718 N.Y.S.2d 353 (1st Dep't 2001).

In Giambrone v. Giambrone, 140 A.D.2d 206, 208, 528 N.Y.S.2d 58 (1st Dep't 1998), the First Department held that the plaintiff's statutory right to discontinue the action, prior to service of a responsive pleading, is unconditional and that the court should not invoke its equitable powers absent special circumstances indicating deviousness, trickery or fundamentally unfair conduct. Here, Defendant offers no evidence of such special circumstances while Plaintiff explains his conduct in discontinuing the action as an attempt to promote a marital reconciliation with the Defendant.

Defendant asserts that Battaglia, McMahon, Giambrone and that line of cases are inapposite because they did not involve circumstances where resolution of the issue of fault, including how the parties would proceed, had been stipulated in a preliminary conference order. Defendant asserts that the stipulation as to grounds constitutes a waiver of the right to discontinue the action. "Waiver is an intentional relinquishment of a known right and should not be lightly presumed." Gilbert Frank Corp. v. Federal Ins. Co., 70 N.Y.2d 966, 968, 525 N.Y.S.2d 793 (1988). See also, Silverman v. Silverman, 304 A.D.2d 41, 46, 756 N.Y.S.2d 14 (1st Dep't 2003); Ess & Vee Acoustical & Lathing Contractors, Inc. v. Prato Verde, Inc., 268 A.D.2d 332, 702 N.Y.S.2d 38 (1st Dep't 2000).

In this case, there is no evidence of a clear manifestation of an intent to waive a known right, i.e. the right to discontinue the action under CPLR 3217(a)(1). The stipulation was silent as to that rule. There is no evidence that the Plaintiff understood that his signature below the stipulation as to grounds would act as a waiver of his rights under CPLR Rule 3217(a)(1). Under the circumstances of this case, there is no basis to find that the Plaintiff intentionally and knowingly waived his right to discontinue the action prior to the filing of a responsive pleading. Therefore, the motion to vacate the Notice of Discontinuance must be denied.

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November 07, 2007

Should I Appeal?

Posted By Brian D. Perskin

A divorce trial is time consuming and expensive. Many times the appellate division only makes minor adjustments to a written decision by a Judge in New York State. Many people appeal and lose, not only time but a lot of money...

Kaplan v. Kaplan, 21 A.D.3d 993, 801 N.Y.S.2d 391 (Second Dept. 2005)(2005 WL 2292997)(2005 N.Y. Slip Op. 06777)(Sep 19, 2005):

Supreme Court, Appellate Division, Second Department, New York.

David KAPLAN, appellant,

Nicole Turano KAPLAN, respondent.

Sept. 19, 2005.

HOWARD MILLER, J.P., BARRY A. COZIER, DAVID S. RITTER, and STEVEN W. FISHER, JJ.

In an action for a divorce and ancillary relief, the father appeals from so much of a judgment of the Supreme Court, Nassau County (LaMarca, J.), entered September 1, 2004, as, after a nonjury trial, awarded the mother custody of the parties' child and permitted her to relocate, and awarded child support in the sum of $3,925 per month, maintenance in the sum of $7,500 per month for 5 years, and an attorney's fee in the sum of $100,000.

ORDERED that the judgment is modified, on the law, the facts, and as a matter of discretion, by (1) deleting the provision thereof awarding child support to the mother in the sum of $3,925 per month and substituting therefor a provision awarding her child support in the sum of $2,836 per month, (2) adding thereto a provision directing that, upon the termination of the father's maintenance obligation, the father's child support obligation shall be upwardly modified to the sum of $4,112 per month, and (3) adding thereto a provision directing that (a) the parties shall jointly consult with each other with respect to the child's education and health, including, but not limited to, decisions pertaining to his special needs arising from his hearing disability, and (b) the parents in their consultation shall always use their best efforts and good faith to arrive at a joint decision in the best interests of the child, but that the mother shall have final decision-making authority; as so modified, the judgment is affirmed insofar as appealed from, without costs or disbursements.

In a child custody determination, a court must decide "what is for the best interest of the child, and what will best promote its welfare and happiness" (Domestic Relations Law ? 70[a]; Eschbach v. Eschbach, 56 N.Y.2d 167, 171; Miller v. Pipia, 297 A.D.2d 362, 364). Factors to be considered include "the quality of the home environment and the parental guidance the custodial parent provides for the child, the ability of each parent to provide for the child's emotional and intellectual development, the financial status and ability of each parent to provide for the child, the relative fitness of the respective parents, and the effect an award of custody to one parent might have on the child's relationship with the other parent" (Miller v. Pipia, supra at 364). The "existence or absence of any one factor cannot be determinative on appellate review since the court is to consider the totality of the circumstances" (Eschbach v. Eschbach, supra at 174; see Miller v. Pipia, supra at 364; Young v. Young, 212 A.D.2d 114, 118). The trial court's determination must be "accorded great deference on appeal, since it had the opportunity to assess the witnesses' demeanor and credibility" (Miller v. Pipia, supra at 364, see Eschbach v. Eschbach, supra at 173). Only where the determination "lacks a sound and substantial basis" should it be disturbed (Miller v. Pipia, supra at 364).

Given that the mother was supportive of visitation, that both parties are fit and loving parents, each capable of caring for the child, that the mother was available to care for the child and address his special needs, and that the mother was the primary caretaker since the child's birth, the trial court properly awarded custody of the parties' child to the mother (see Cohen v. Merems, 2 AD3d 663; Miller v. Pipia, supra; Forzano v. Scuderi, 224 A.D.2d 385). However, given the foregoing, we deem it appropriate to modify the judgment to add a provision directing that the parties, in good faith, jointly consult with each other regarding decisions pertaining to the child's education and health, with the mother having final decision-making authority.

Contrary to the father's contention, the trial court properly weighed the relevant factors set forth in Matter of Tropea v. Tropea (87 N.Y.2d 727), and determined that the mother's relocation to Chappaqua, in Westchester County, will serve the best interests of the child.

Further, in calculating the amount of the child support award pursuant to the Child Support Standards Act (hereinafter CSSA) (see Domestic Relations Law ? 240[1-b] ), the trial court opted to apply the child support percentage (in this case 17%) to the combined parental income over $80,000. The father contends that the Supreme Court erred in failing to articulate a reason for applying the statutory percentage to the combined parental income over $80,000. We disagree. The court's 50-page decision after trial meticulously described the parties' respective circumstances, and there is "sufficient record indication" that application of the statutory percentage was justified (see Matter of Cassano v. Cassano, 85 N.Y.2d 649, 655). The mother was not working at the pertinent time, and was attending to child care, including the child's special needs. The father was working, and was earning in excess of $400,000 per year. We conclude that the Supreme Court providently exercised its discretion in capping his annual income at $300,000. Thus, as the Supreme Court correctly concluded, the combined parental income was $300,000, and the father's percentage obligation for child support was 100%. However, in making its child support determination, the Supreme Court failed to deduct from the father's income the amount of maintenance ($90,000 per year) that he was ordered to pay to the mother (see Domestic Relations Law ? 240[1-b][b][5] [vii] ). The court further erred in its FICA calculation.

Rather than remit the matter to the Supreme Court, Nassau County, for a recalculation of child support, in the interest of judicial economy, we do so. Thus, after deducting from the annual income of $300,000, the sums of $90,000 for maintenance and $9,768 for FICA, and applying the 17% statutory rate, we conclude that the father's child support obligation should be the sum of $2,836 per month. Upon termination of the father's maintenance obligation, his child support obligation shall be upwardly modified to the sum of $4,112 per month (see Domestic Relations Law ? 240[1-b][b][vii][C] ).

The mother was awarded maintenance in the sum of $7,500 per month for 5 years. Contrary to the father's contention, the maintenance award was a proper exercise of the trial court's discretion, taking into consideration the relevant factors, including the parties' pre-separation standard of living, the separate property retained by each party and their respective net equitable distributive awards of marital property, the mother's absence from the work force as a certified social worker for most of the period following the birth of the parties' special needs child on January 19, 2001, the mother's continued role as the primary caretaker of a special needs child, the father's significantly higher earning capacity as a successful partner in a radiology practice, and the short duration of the parties' marriage (see Domestic Relations Law ? 236[B][6][a]; Comstock v. Comstock, 1 AD3d 307; Alvares-Correa v. Alvares-Correa, 285 A.D.2d 123; Finkelson v. Finkelson, 239 A.D.2d 174; Milewski v. Milewski, 197 A.D.2d 562).

The attorney's fee award to the mother was a proper exercise of the trial court's discretion (see Domestic Relations Law ? 237[a]; Charpie v. Charpie, 271 A.D.2d 169; Vicinanzo v. Vicinanzo, 193 A.D.2d 962; Sclafani v. Sclafani, 178

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August 18, 2007

A Dozen Things to Consider Before You File

Posted By Brian D. Perskin

A Dozen Things To Consider Before Filing For Divorce
posted: 6:42 pm on Sunday, May 6th, 2007
filed in: Property
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The Maine Divorce Law Blog suggests a “Dozen Things to Consider Before Filing for Divorce”.

You know the numbers. It’s projected right now that about half of all new marriages end up in divorce. It’s a horrible statistic that doesn’t begin to suggest the emotional and financial strain that it puts on families. Other than the death of your spouse, divorce is probably the most stressful event you’ll ever face. I’ve had women discussing their divorce in my office become violently ill. I’ve seen hardened fishermen cry in open court during their divorce hearing. Make no mistake – divorce is hell.

So what have I learned after being a lawyer for nearly 30 years and helping many folks go through this difficult process? If you believe that a divorce is in your future, here are 12 things think about:

1. Don’t do it. If you feel there is any chance that you can save your marriage, try it. See a marriage counselor, talk to a therapist, seek spiritual help, eat some humble pie – whatever, but don’t take the step of filing for a divorce lightly. In all my years as a lawyer, I’ve never seen a divorce that wasn’t emotionally grueling on the parties and their children. If there is any chance at all of saving your marriage, give it a shot – even if it doesn’t work, you’ll feel better later on knowing that you tried everything possible.

2. Get a lawyer. In most states, divorces involve lots of paperwork and a dizzying array of legal decisions. You need to know your legal rights and responsibilities and should talk to an attorney BEFORE you are ready to begin proceedings. Be wary of books giving you legal advice. Divorce laws vary greatly in the United States and you need to speak with a lawyer familiar with the laws in the state where you live.

3. Kids First. If you have children, it’s never too early in the divorce proceeding to consider their needs. How and when are you going to tell them about your decision to file for divorce? Will you tell them yourself, or with your spouse? It’s important to make sure that they are told in such a way that it is clear to them that they are not the cause of the divorce, that they are still loved by both of you and that they’ll still be taken care of. Children suffer the most during a divorce so it’s important that their routines be changed as little as possible. Get or keep involved in their everyday activities. Don’t say anything negative about your spouse in front of them. Don’t take out the anger and frustration you may feel toward your spouse out on your children. Make them your top priority. Give your children all the love, attention, emotional and financial support you can during this stressful time.

4. Copy Important Financial Documents. Anything that has to do with your finances should be copied:
* Federal and state tax returns;
* Recent Pay Stubs;
* Bank and credit card statements;
* Deeds and real estate appraisals;
* Mortgage documents and statements;
* Investment and retirement statements;
* Wills and life insurance policies; and
* Automobile titles.

Don’t forget to check your home computer for some of this information. If you use financial software like Quicken or some other program, back up a copy of your entire on-line file and save it to a CD. Note that this is only a partial list of documents – your lawyer may want even more information. Again, this should be done BEFORE you file for a divorce. It’s amazing how these documents seem to “disappear” once you file for your divorce.

5. Find out what you own. Take stock of your possessions. Get out a pencil and paper and write down everything that you own – you may not want to count every spice in the cupboard, but write down major items like automobiles, appliances, jewelry, furniture, antiques or anything else that is valuable. You may want to omit all items under, say, $100 and list the remaining items. You might also consider taking a video of the interior of the house and noting some of the more expensive possessions. Pictures – say with a camera phone – also work well.

6. Find out what you owe. The importance of getting a clear picture about your income and expenses can’t be emphasized enough. To a large extent, divorces are about money. You say all you care about are the children? Well, you need money to support them. You want to stay in the marital home? Do you have the ability to pay the mortgage? Many times only one spouse is directly involved in the day-to-day payment of expenses. If you’re that spouse, you probably have a good handle on the debts and expenses of your family. If you’re not that spouse, you need to get up to speed in a hurry. Either way, it’s time for you to develop a household budget and know exactly where all the money is going. If possible, take a look at your Quicken report or your bank statements or checking account register and determine where you’re spending your money and what your debts are at this time. Keep in mind that many people spend quite a bit of cash each week – so you need to factor that into your budget. Knowing your budget and expenses is extremely important in the beginning of the case when spousal support, child support or both might be an issue. It’s also crucial later on when you’re discussing settlement or going to trial. Once you’re living on your own again, you need to know this information to intelligently assess your needs.

7. Determine your spouse’s income. My experience is that many husbands and wives don’t really know what their spouses make for money. If your spouse has a regular salary, get copies of his or her W2’s and pay stubs. In addition to their regular income, do they receive bonuses, tips or other fringe benefits – like reimbursements for car or housing expenses, employer paid insurance benefits or free meals? Who pays for health insurance and are there any employer contributions? Take into account employment sponsored retirement accounts, IRAs, 401(k)s or annuities. If your spouse is self-employed, owns a business or ever gets paid in cash, it’s often difficult to accurately determine income. Get as much information as possible and present it to your lawyer for review. You may need the help of an accountant or other expert to help in this area.

8. Figure out what happens when you move out. Someone generally leaves the marital home to find another place to live. Once again, BEFORE you decide whether or not to leave, talk to a lawyer. It can have adverse consequences to be the one to leave the marital home and some lawyers routinely advise clients to stay in the marital residence if at all possible (absent abuse). Depending on your state laws, being the one to move out could weaken your position later as it relates to child custody or your ability to ever return to your home. Once someone does leave, you need to figure out how to pay the family debt. You and your spouse are going to have to allocate your debts – if you can’t agree on how, the court will do it for you. If you’re still paying on debt that you brought into the marriage, this may be considered “non-marital debt” and be your responsibility in addition to the other debt.

9. Divide up bank accounts. It’s best if you do this with your spouse or at least after notifying your spouse. But if you fear that your spouse is going to immediately empty out all your joint bank accounts upon being told about the divorce, consider withdrawing half – but not all – of the money you have in your savings accounts. If you can withdraw half of the money from the checking account without causing a financial mess, you may want to do that too. Put the funds in a separate account in a different bank and don’t spend them if at all possible! You’ll undoubtedly have to divulge what you did with the money so keep track of it. As usual, check with your lawyer before taking this step.

10. Know what you can earn. Living in two households is always more expensive than living in one. Whatever you make, it won’t seem to be enough. If you earn a regular salary, is there a way for you to work overtime to supplement your income? Do you have any other way to legitimately earn more? If you’ve been out of the workforce for a while, what type of income can you realistically expect when returning? Do you need extensive training or more education before you return to work? Is your earning limited because you have small children and can only work part time? If you work full time, will that significantly increase your child care expenses? If your job requires extensive travel, will you continue to be able to do it and still see the children on a regular basis?

11. Take a look at your credit history. Do you and your spouse have credit cards in your own individual names? If not, you may want to apply for them now to establish your own credit history. If your credit is poor, take steps now to improve it. Unfortunately, my experience is that money in a divorce often becomes so tight that bills get overlooked or not paid on time and the credit rating of both spouses suffers. If at all possible, try to not let this happen. You also need to consider canceling credit cards if one spouse routinely runs up huge credit card bills. Another alternative is to reduce the spending limit. Be sure to talk to your lawyer about this as well as your spouse.

12. Save, save, save. This is advice that you should do long before you even consider getting a divorce. Save as much money as you can in your own name so that you have easy access to cash in the event you need it. If your spouse is the primary breadwinner and moves out and refuses to pay the bills, you need to pay them until a court issues a temporary order indicating who is responsible for payment. Many times, even when filing an expedited request for a hearing, it takes weeks or even months to get into court on a temporary support request. If you’re the person moving out, you’ll need money for a security deposit on an apartment or to buy appliances and other household items. Start saving now to ease the financial burden that nearly all couples go through when obtaining a divorce. Finally, don’t forget the major expense that you and your spouse will both have when getting a divorce: legal retainers.

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A Dozen Things To Consider Before Filing For Divorce
posted: 6:42 pm on Sunday, May 6th, 2007
filed in: Property
comments: RSS 2.0
your response: Comment or Ping
meta:

The Maine Divorce Law Blog suggests a “Dozen Things to Consider Before Filing for Divorce”.

Name (required)

Mail (will not be published) (required)

Website

About This Site

Our Websites

A Free Resource Provided by:

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4101 Lake Boone Trail, Suite 500
Raleigh, North Carolina 27607
Phone: (919) 787-6668

301 McCullough Drive Suite 510
Charlotte, North Carolina 28262
Phone: (704) 307-4600

1829 East Franklin Street, Bldg 600
Chapel Hill, North Carolina 27514
Phone: (919) 321-0780

Podcast Powered by podPress (v8.2)

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August 18, 2007

Duress is Difficult to Prove

Posted By Brian D. Perskin

Prenuptial agreements are becoming increasingly common in New York. I have been preparing more and more as time goes on. Many people always ask me, will it hold up in Court? As long as the agreement complies with the laws of execution in New York, more and more litigants are finding that it is difficult to set aside agreements under New York State Divorce laws.

In the following case, a Judge in Nassau county set aside a prenuptial agreement, however, the appellate division overturned the judge's ruling and held the agreement was valid.

66.8.4 - - - Weinstein

Weinstein v. Weinstein, 36 A.D.3d 797, 830 N.Y.S.2d 179 (Second Dept. 2007)(2007 WL 178279)(Jan. 23, 2007):

Supreme Court, Appellate Division, Second Department, New York.

Neil WEINSTEIN, appellant,
v.
Tina WEINSTEIN, respondent.

Jan. 23, 2007

REINALDO E. RIVERA, J.P., ROBERT A. SPOLZINO, DAVID S. RITTER, and DANIEL D. ANGIOLILLO, JJ.

In an action for a divorce and ancillary relief, the plaintiff husband appeals, as limited by his brief, from so much of an order of the Supreme Court, Nassau County (Diamond, J.), entered September 16, 2005, as, after a hearing, denied that branch of his motion which was to dismiss the defendant wife's third affirmative defense alleging that the parties' prenuptial agreement was invalid.

ORDERED that the order is reversed insofar as appealed from, on the law, with costs, and that branch of the husband's motion which was to dismiss the wife's third affirmative defense is granted.

The husband moved to dismiss the wife's third affirmative defense, in which the wife asserted that the prenuptial agreement was unenforceable because the form of the acknowledgment attached to the agreement did not satisfy the statutory requirements, the agreement was not duly acknowledged, and she executed the agreement under duress. After a hearing, the Supreme Court found the parties' prenuptial agreement to be invalid and unenforceable because the certificate of acknowledgment did not contain the precise language prescribed in Real Property Law ? 309-a. Crediting the wife's testimony, the Supreme Court further concluded that the agreement was unenforceable due to "possible fraud and duress" in its execution. We reverse.

A prenuptial agreement is valid only if it is "in writing, subscribed by the parties, and acknowledged or proven in the manner required to entitle a deed to be recorded" (Domestic Relations Law ? 236[B][3]; see Matisoff v. Dobi, 90 N.Y.2d 127, 132). Here, the agreement was in writing and was subscribed by both parties, but the certificate of acknowledgment attached to the agreement was not in the form currently specified by Real Property Law ? 309-a. Rather, the certificate of acknowledgment was in the form prescribed by the statute prior to its amendment in 1997 (see L 1997, ch 179).

Contrary to the wife's argument, there is no requirement that a certificate of acknowledgment contain the precise language set forth in the Real Property Law. Rather, an acknowledgment is sufficient if it is in substantial compliance with the statute (see Real Property Law ? 309-a[1]; Smith v. Boyd, 101 N.Y. 472; Schum v. Burchard, 211 App.Div. 126, affd 240 N.Y. 577). "There are two aspects to an acknowledgment: the oral declaration of the signer of the document and the written certificate, prepared by one of a number of public officials, generally a notary public" (Garguilio v. Garguilio, 122 A.D.2d 105, 106; see Rogers v. Pell, 154 N.Y. 518, 528-529; Detmer v. Detmer, 248 A.D.2d 582). Since both aspects were satisfied here, the acknowledgment substantially complied with the requirements of the Real Property Law. The minor discrepancy in the date on which the document was executed was not, in itself, a basis to set aside the agreement.

Further, although the Supreme Court found the testimony of the wife with respect to the issue of fraud to be credible, her testimony did not establish a basis upon which the agreement may be set aside. The burden of proof is on the party seeking to invalidate the agreement (see Lombardi v. Lombardi, 235 A.D.2d 400; Forsberg v. Forsberg, 219 A.D.2d 615). In the absence of evidence that the husband wilfully concealed assets, his offer to provide financial disclosure upon the wife's assent to the agreement did not constitute fraud (see Matter of Davis, 20 N.Y.2d 70, 74; Panossian v. Panossian, 172 A.D.2d 811, 813; Eckstein v. Eckstein, 129 A.D.2d 552, 553; Hoffman v. Hoffman, 100 A.D.2d 704, 705). Moreover, the agreement expressly disclaimed any reliance on representations other than those set forth in the agreement. The husband's threat to cancel the wedding if the agreement was not signed did not establish duress (see Colello v. Colello, 9 AD3d 855, 858).

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August 18, 2007

It is Never Too Late to Collect

Posted By Brian D. Perskin

Many times in New York divorce cases people make separation or settlement agreements for events that will happen in the future. A great example is when a wife or a husband agrees to take a percentage of their spouse's pension benefits when they retire. However, for one reason or another neither side prepares a qualified domestic relations order, required under the law in New York, to get the benefits directly from the pension plan.....

In this recent case from the third department, a wife never knew her husband retired and was unable to collect the past benefits that were beyond the statute of limitations. Make sure your new york divorce lawyer files for a qualified domestic relations order, upon the granting of the divorce in New York.

66.7.25 - - - Boylan v. Dodge

Boylan v. Dodge, --- N.Y.S.2d ----, 2007 WL 1932106 (Third Dept. 2007)(July 05, 2007):

Supreme Court, Appellate Division, Third Department, New York.

VIRGINIA M. BOYLAN, Formerly Known as VIRGINIA M. DODGE, Respondent,

HAROLD E. DODGE, Appellant.

July 5, 2007

Harvey C. Shapiro, Binghamton, for appellant.

Coughlin & Gerhart, L.L.P., Binghamton (Carl A. Kieper of counsel), for respondent.

Before: Mercure, J.P., Spain, Carpinello, Mugglin and Kane, JJ.

MEMORANDUM AND ORDER

Carpinello, J.

Appeal from an order of the Supreme Court (Tait, J.), entered March 28, 2006 in Tioga County, which granted plaintiff's motion for summary judgment.

Following a 38-year marriage, the parties entered into a separation agreement in 1991 pursuant to which plaintiff was to receive a 41% share of defendant's monthly pension upon his retirement. A judgment of divorce was entered on November 13, 1992 and defendant retired shortly thereafter without telling plaintiff. According to plaintiff, she did not know that defendant retired and never received her share of the pension during his first 12 years of retirement. Accordingly, in October 2004, she commenced this action for breach of contract seeking specific performance of the pension provision of the separation agreement. Supreme Court found that defendant breached the separation agreement by failing to provide plaintiff with her share of his monthly pension and thus awarded her summary judgment. It also determined that the six-year statute of limitations precluded recovery of arrears prior to October 1998. Supreme Court then issued a Qualified Domestic Relations Order (hereinafter QDRO) directing the pension plan administrator of defendant's former employer to pay plaintiff 41% of defendant's monthly pension payment pursuant to the terms of the separation agreement, plus an additional monthly payment of 50% of the remaining amount to satisfy those arrears that accrued within the statute of limitations. Defendant appeals. FN1

1. We deem defendant's appeal from the March 28, 2006 order of Supreme Court as being taken from the subsequently-entered judgment (see CPLR 5520[c]; see also Harrington v. Harrington, 300 A.D.2d 861, 862 [2002]; Alessi v. Alessi, 289 A.D.2d 782, 782-783 [2001] ).

We agree with Supreme Court's assessment that a QDRO is the proper method for plaintiff to collect the pension arrears in this case (see Peek v. Peek, 301 A.D.2d 201, 204-205 [2002], lv denied 100 N.Y.2d 513 [2003] ). Plaintiff's entitlement to a portion of defendant's monthly pension benefits was a right created under the separation agreement (see Domestic Relations Law ? 236[B] [3] ) and Supreme Court's order issuing the QDRO merely recognized such right (see 29 USC ? 1056[d][3][B][i][I] ). This being the case, the order was "made pursuant to a State domestic relations law" (29 USC ? 1056[d][3][B] [ii][II] ) and thus we find no error in Supreme Court's decision to direct payment of pension arrears via the QDRO (see Peek v Peek, supra; see generally Kaplan v Kaplan, 82 N.Y.2d 300, 305-306 [1993]; McDermott v. McDermott, 119 A.D.2d 370, 379-380 [1986], appeal dismissed 69 N.Y.2d 1028 [1987] ).

It is important to hire a lawyer who stays up to date on the latest developments in the law. For further information about The Law Offices of Brian D. Perskin please click here.

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July 17, 2007

The Family Jewels

Posted By Brian D. Perskin

It is a common misconception that jewelry is necessarily the separate property of the wife and is never subject to equitable distribution. In fact, many people don't even mention jewelry when discussing assets during a divorce case. See the excerpt below for an example of equitable distribution of jewelry and don't forget to discuss your family jewels with your attorney.

Excerpt from Ciaffone v. Ciaffone, 645 N.Y.S.2d 549 (1996).

Supreme Court's classification of certain items of jewelry given plaintiff by defendant during the marriage as marital property was correct (see, Chase v Chase, 208 A.D.2d 883, 884, 618 N.Y.S.2d 94). It should, however, have given plaintiff a credit of $1,724 for the evidence shows that these funds were plaintiff's separate property which she utilized to purchase a ring. This credit reduces the distributive value of the jewelry to $7,676 ($9,400 - $1,724) and plaintiff's distributive award therein to $3,070.

It is important to hire a lawyer who stays up to date on the latest developments in the law. For further information about The Law Offices of Brian D. Perskin please click here.

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July 03, 2007

Is my inheritance safe?

Posted By Brian Perskin

The question of whether or not an inheritance is subject to equitable distribution has gotten in a lot of attention. Take a look at the following excerpt from Spencer v. Spencer which finds that inheritance is separate property, but its appreciated value is marital property...

Excerpt from Stencer v. Stencer, 646 N.Y.S.2d 674, 230 A.D.2d 645
Decided August 15, 1996

The trial court properly concluded that an inheritance received by the plaintiff from his brother and sister, and thereafter placed in the Merrill Lynch investment account, was his separate property upon receipt, and that he continued to maintain this asset as separate throughout the marriage ( McGarrity v McGarrity, 211 A.D.2d 669, 622 N.Y.S.2d 521; Alaimo v Alaimo, 199 A.D.2d 1039, 606 N.Y.S.2d 117; Feldman v Feldman, supra). The fact that the plaintiff may have made withdrawals from his separate account to pay marital expenses does not alter this conclusion ( Feldman, supra, at 216), as there was insufficient evidence of commingling to conclude that this account was transmuted into marital property.

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July 02, 2007

Struggle over Stock

Posted By Brian Perskin

Clients often ask about the distribution of stock or employee stock options upon divorce. Unfortunately, there is no one way to determine the value of these assets without immediate sale, which is frequently undesirable for both parties. For a discussion of the factors that may be used in valuing a stock interest, see Amodio v. Amodio which is copied below.

THERESA AMODIO, APPELLANT,
v.
MICHAEL P. AMODIO, RESPONDENT

Appeal, by permission of the Court of Appeals, from an order of the Appellate Division of the Supreme Court in the Second Judicial Department, entered August 4, 1986, which unanimously affirmed so much of a judgment of the Supreme Court (Morton B. Silberman, J.H.O.), entered in Westchester County, as valued defendant husband's 15% interest in a closely held corporation at $87,500, and denied plaintiff wife's request for an award of counsel fees, expert fees or appraisal expenses.

The only issue before the court in this divorce action is the value, for equitable distribution purposes, of defendant's 15% stock interest in Capitol Electrical Supply Co., Inc., a closely held corporation. Defendant acquired the stock in 1980 for $87,500 pursuant to the terms of a shareholder's agreement which provides that if defendant seeks to sell his stock within 20 years, the other shareholders may exercise a right of first refusal and purchase his shares for the price paid. The agreement also provides that if defendant dies within its 20-year term, the surviving stockholders can acquire his interest for $87,500. After a trial the court concluded that the stock was worth $87,500 and the Appellate Division affirmed.

There is no uniform rule for valuing stock in closely held corporations. "One tailored to the particular case must be found, and that can be done only after a discriminating consideration of all information bearing upon an enlightened prediction of the future" (Snyder's Estate v United States, 285 F2d 857, 861). The Internal Revenue Service has declared that appropriate factors to be considered in valuing such stock for tax purposes include: (1) the nature and history of the business, (2) its particular economic outlook and that of its industry generally, (3) the book value of the stock and the financial condition of the business, (4) the company's earning capacity, (5) its dividend paying capacity, (6) its goodwill and other intangible assets, (7) other sales of the corporation's stock, and (8) the market price of stock of comparable corporations (Rev Rul 59-60, IRS Cum Bull 1959-1, at 237).

The Internal Revenue Service's formulation is not the only method of valuing stock in a closely held corporation, but it has been recognized by authors and applied by appellate courts and was one of the two methods used by plaintiff's expert witness in this case (see, Matter of Blake v Blake Agency, 107 A.D.2d 139, 146-147, lv denied 65 N.Y.2d 609; Kaye v Kaye, 102 A.D.2d 682, 687; 3 Foster, Freed and Brandes, Law and the Family, New York § 15:2, at 644-645 [2d ed 1986]; Golden, Equitable Distribution of Property §§ 7.08-7.09, at 215-219 [1983]; 11C Zett-Kaufman-Kraut, NY Civ Prac, Equitable Distribution Actions § 69.04 [3], [4], at 69-26 - 69-44). Whatever method is used, however, must take into consideration inhibitions on the transfer of the corporate interest resulting from a limited market or contractual provisions (see, 3 Foster, Law and the Family, op. cit., at 645; 11C Zett, NY Civ Prac, op. cit., at 69-25, 69-46 - 69-48; cf., Matter of Blake v Blake Agency, supra, at 149). If transfer of the stock of a closely held corporation is restricted by a bona fide buy-sell agreement which predates the marital discord, the price fixed by the agreement, although not conclusive, is a factor which should be considered (see, Kaye v Kaye, 102 A.D.2d 682, 687, supra; Bowen v Bowen, 96 NJ 36, 473 A2d 73; Rev Rul 59-60, § 8; cf., Stern v Stern, 66 NJ 340, 331 A2d 257). The decisions below, however, could be read as indicating that the courts found the price fixed in the agreement controlling because under the agreement the stock was not currently transferable. That the stock could not immediately be sold is not dispositive; marital property may have a value to the holder notwithstanding that it has no present market value (see, O'Brien v O'Brien, 66 N.Y.2d 576, 586-587 [value of professional license]; Majauskas v Majauskas, 61 N.Y.2d 481 [value of vested but unmatured pension]; see also, 11C Zett, NY Civ Prac, op. cit. § 69.04 [1], at 69-24 - 69-25). The court must consider all the circumstances reflecting on the present worth of the property to the titleholder. It need not rely solely on the price set forth in a buy-sell agreement if other evidence exists.

In this case plaintiff's expert witness, using two different methods of appraisal, testified that the value of defendant's stock was between $172,000 and $253,000. His first method computed the value of the stock by dividing the corporation's estimated shareholder equity by defendant's 15% interest in the corporation. The other valued the corporation, and defendant's stock interest in it, by applying the guidelines for valuing close corporations set forth in Revenue Ruling 59-60. However, the witness did not consider the stock transfer restrictions contained in the shareholders' agreement in either method. That being so, the courts properly determined defendant's stock was worth $87,500, the price contained in the shareholders' agreement, because that was the only evidence in the record of its actual value.

Accordingly, the order of the Appellate Division should be affirmed, with costs.

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June 28, 2007

Post Nuptial Agreements

Posted By Brian Perskin

A Post nuptial agreement is basically a settlement agreement. However, the Courts in New York will require that the agreement is fair. Many times, when one spouse feels guilty they will sign anything. In the following case this is exactly what happened. Remember, before you sign something, retained an experienced New York Divorce Attorney, if it is patently unfair, it will never work.

66.8.24 - - - Darrin

Darrin v. Darrin, --- A.D.3d ---, --- N.Y.S.2d --- (Third Dept. 2007)(2007 WL 1555892)(2007 N.Y. Slip Op. 04558)(May 31, 2007):

Susan C. DARRIN, Appellant,

David DARRIN, Respondent.

May 31, 2007

Before: CARDONA, P.J., MERCURE, CARPINELLO, MUGGLIN and KANE, JJ.

CARDONA, P.J.

Appeal from an order of the Supreme Court (Teresi, J.), entered November 28, 2006 in Albany County, which granted defendant's motion for partial summary judgment finding the prenuptial agreement executed by the parties to be valid and enforceable.

On July 20, 1987, five days before their wedding ceremony, plaintiff and defendant entered into a prenuptial agreement wherein, among other things, defendant disclosed his financial status and acknowledged his future potential interest in a substantial family trust. In accordance with certain provisions of the agreement, defendant was to make fixed monthly payments to plaintiff which would increase upon their tenth wedding anniversary and, in the event of divorce, a cash settlement based upon the length of the marriage would be paid to plaintiff. Given these monthly payments and cash settlement, plaintiff waived, among other things, all rights to spousal support, maintenance and equitable distribution in the event the parties divorced. Thereafter, a July 25, 1987 wedding ceremony was held, however, due to a problem with the filing of the marriage certificate, the parties were not officially married until a subsequent ceremony in November 1987.

In April 2005, plaintiff commenced this action seeking a divorce as well as, among other things, maintenance and equitable distribution. Defendant moved for partial summary judgment declaring the prenuptial agreement to be valid and enforceable. In opposition, plaintiff alleged that the agreement was procured through fraud, duress and overreaching. Supreme Court granted defendant's motion, resulting in this appeal.

We find no error in granting defendant partial summary judgment upholding the validity and enforceability of the parties' prenuptial agreement. It is well settled that a prenuptial agreement is accorded the same presumption of legality as any other contract (see Matter of Garbade, 221 A.D.2d 844, 845 [1995], lv denied 88 N.Y.2d 803 [1996]; Brassey v. Brassey, 154 A.D.2d 293, 294-295 [1989] ) and the validity of such an agreement is presumed unless the party opposing the agreement comes forward with evidence demonstrating "fraud, duress, or overreaching, or that the agreement or stipulation is ... unconscionable" (Korngold v. Korngold, 26 AD3d 358, 358 [2006], lv dismissed 7 NY3d 861 [2006]; see Costanza v. Costanza, 199 A.D.2d 988, 989 [1993] ). " ?[I]n the absence of proof of facts from which concealment or imposition may reasonably be inferred, fraud will not be presumed.... Such a presumption [of fraud] must have as its basis evidence of overreaching-the concealment of facts, misrepresentation or some other form of deception? " (Matter of Sunshine v. Sunshine, 51 A.D.2d 326, 328 [1976], affd 40 N.Y.2d 875 [1976], quoting Matter of Phillips, 293 N.Y. 483, 491 [1944] ). Furthermore, where the spouse opposing the validity of the agreement fails to raise any triable issue of fact, the proponent of the agreement is entitled to summary judgment (see Tremont v. Tremont, 35 AD3d 1046, 1047 [2006] ).

Even accepting plaintiff's allegations as true, a review of the record herein fails to demonstrate any triable issues of fact with respect to fraud, duress or overreaching in connection with the execution of the prenuptial agreement. With respect to plaintiff's allegation of duress, the substantial financial disparity between the parties was fully disclosed at the time the agreement was executed. Moreover, despite the fact that plaintiff was unemployed at the time the agreement was executed and allegedly dependent on defendant's support, there is no evidence that defendant used his wealth as leverage to coerce plaintiff to sign the agreement. Although plaintiff also alleges coercion in the hurried nature of the circumstances surrounding the procurement of the agreement, the record fails to support such a contention, particularly in light of the fact that the parties were not officially married until four months after the agreement was signed. In regard to plaintiff's challenge to the effective and independent representation of her attorney, the conclusory allegations are insufficient to raise a triable issue of fact (see Korngold v. Korngold, supra at 358-359; see also Colello v. Colello, 9 AD3d 855, 858 [2004] ).

Turning to plaintiff's allegation of fraud in the inducement as evidenced by defendant's failure to abide by various provisions in the agreement-specifically his failure to increase his monthly payments to her on their tenth anniversary or transfer title to certain property-such allegations relate to defendant's breach of the agreement, not the validity of the agreement itself, and are insufficient to raise a question of fact as to any undisclosed intention on defendant's part not to perform the promises therein at the time the agreement was executed (see Colello v. Colello, supra at 858).

Finally, the record does not support plaintiff's contention that the agreement is unconscionable (see Domestic Relations Law ? ? 236[B][3][3]; Colello v. Colello, supra at 859-860; Lounsbury v. Lounsbury, 300 A.D.2d 812, 814 [2002] ). Considering all the provisions of the prenuptial agreement, we cannot say that it was so unfair "as to shock the conscience and confound the judgment of any [person] of common sense" (Lounsbury v. Lounsbury, supra at 814 [internal quotation marks and citations omitted] ).

Plaintiff's remaining contentions have been reviewed and found to be without merit.

ORDERED that the order is affirmed, without costs.

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June 23, 2007

What if I worked to much overtime?

Posted By Brian Perskin

Child support is calculated from a parties last filed federal income tax return. The Court cannot discount the fact that an individual made to much money in the year before determining child supp

The Child Support Standards Act (Domestic Relations Law ? 240[1-b]; hereinafter the CSSA) requires the court to establish the parties' basic child support obligation as a function of the income that is, or should have been, reflected on the party's most recently filed income tax return (see Domestic Relations Law ? 240[1-b][b][5][I]; Miller v. Miller, 18 AD3d 629, 631; Bains v.. Bains, 308 A.D.2d 557; McNally v. McNally, 251 A.D.2d 302, 303). Thus, although it is not improper to impute income to a party where the record demonstrates that a party's income tax return does not reflect the party's actual income (see Renzulli v. Renzulli, 251 A.D.2d 482; Murphy-Artale v. Artale, 219 A.D.2d 587) or demonstrated earning potential (see Nebons v. Nebons, 26 AD3d 478; Zabezhanskaya v. Dinhofer, 274 A.D.2d 476; Phillips v. Phillips, 249 A.D.2d 527), the statute does not permit the court to determine a party's income for child support purposes by excluding actual overtime wages (see Parise v. Parise, 13 AD3d 504; Kelley-Milone v. Milone, 256 A.D.2d 554) or by averaging a party's earnings over several years (see Reilich v. Reilich, 275 A.D.2d 929), as the Supreme Court did here. Although the Supreme Court properly found that the plaintiff was capable of earning $35,000 a year based upon her education, past employment, and earnings potential, it was improper to base the child support calculation on an average of the defendant's past earnings. In determining the defendant's income for child support purposes, the Supreme Court correctly deducted from the defendant's income the maintenance he is required to pay (see Thoma v. Thoma, 21 AD3d 1080, 1082; Chalif v. Chalif, 298 A.D.2d 348, 349), but incorrectly included the maintenance payments in the plaintiff's income (see Shapiro v. Shapiro, 35 AD3d 585; Harrison v. Harrison, 255 A.D.2d 490) and should have provided for a corresponding adjustment in child support upon the expiration of the durational maintenance award (see Domestic Relations Law ? 240[1-b][b][5][vii][c]; Navin v. Navin, 22 AD3d 474; Parise v. Parise, supra; Rohrs v. Rohrs, 297 A.D.2d 317, 318; Lee v. Lee, 18 AD3d 508, 509; Smith v. Smith, 1 AD3d 870). Finally, the Supreme Court did not articulate its reasons for awarding child support in addition to basic child support, as it is required to do (see Matter of Cassano v. Cassano, 85 N.Y.2d 649, 654-655; Clerkin v. Clerkin, 304 A.D.2d 784; Wagner v. Dunetz, 295 A.D.2d 501).

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June 03, 2007

What about additional Debt ?

Posted By Brian Perskin

Divorce Preparation: Step 9 - Avoid additional debt or major purchases

We continue our series on practical steps to take when you are about to face divorce. We are now to step 9 which is simple, but important:

Avoid additional debt or major purchases

This suggestion goes hand in hand with assessing how to handle the credit accounts, but deserves its own separate mention. If a divorce is going to happen, you want to be conservative with the finances. It is not time to be putting in a pool, buying a new car, or buying new furniture on credit. You want to simplify the financial situation not make it more complex.

When the divorce occurs, one of the primary things that has to happen is for the divorce court to allocate who will be responsible for what debts. Generally speaking, the less complex the debt situation, the easier task that will be.

I should note again, all of this is general information. Your own specific situation may cause you to need to vary from it. For example, there are times when you may have to get an automobile and it would be better to do it before the divorce because you won't have sufficient credit on your own after the divorce. So, obviously you will want to get specific advice from your own lawyer - which is why Step 1 was find a wise guide (an experienced, competent divorce law specialist)!

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June 03, 2007

Do I have enough for Cruelty to Get a Divorce?

Posted By Brian Perskin

The appellate division in the first department recently ruled in Gross v. Gross that in order to be granted a divorce based on the grounds of cruel treatment in New York, a divorce litigant must have substantial proof. That means, a lawyer must come to trial prepared and have evidence to submit to the Court. Otherwise, you are just wasting your time. Read this recent case and you will be amazed at how tough it is to get divorced in New York

[*1]Carol Gross, Plaintiff-Respondent,

v

Jerome Gross, Defendant-Appellant.

Order, Supreme Court, New York County (Joan B. Lobis, J.), entered February 21, 2006, which granted plaintiff a judgment of divorce on the ground of cruel and inhuman treatment, unanimously reversed, on the law, without costs, and the complaint dismissed. The Clerk is directed to enter judgment accordingly.

"To obtain a divorce on the ground of cruel and inhuman treatment (Domestic Relations Law § 170[1]), the plaintiff must show serious misconduct, not mere incompatibility, i.e., a course of conduct by the defendant that is harmful to the plaintiff's physical or mental health and makes cohabitation unsafe or improper (Brady v Brady, 64 NY2d 339, 343 [1985])" (Shou-Tsung Lin v Straub, 282 AD2d 234 [2001]). Moreover, in a marriage of long duration a "high degree" of proof of cruel and inhuman treatment is required (Palin v Palin, 213 AD2d 707 [1995], citing Brady, supra; Hessen v Hessen, 33 NY2d 406 [1974]).

Plaintiff was asked at trial whether defendant had ever "physically force[d] himself on [her] sexually." In response, plaintiff testified that "I would have to say yes. It's only one time that, really where he hurt me." Apparently by way of explanation, plaintiff went on to state that defendant "[r]ammed [her] up against the wall" in the bathroom of their residence. Plaintiff did not elaborate in any other way about what she meant in stating that defendant had "force[d] himself on [her] sexually." In its vagueness and generality, this testimony could include conduct ranging from the criminal (e.g., forcible rape) to the merely obnoxious. Moreover, plaintiff offered no evidence that she had sustained any injuries as a result of this incident (see generally Palin, supra [plaintiff in marriage of long duration required to satisfy a high degree of proof of cruel and inhuman treatment]). To the contrary, she testified on cross-examination that she did not suffer any physical injuries as a result of the incident.

Plaintiff also testified that defendant, on many occasions, "physically grabbed [her]." When asked to describe how defendant "grabbed" her, plaintiff stated: "[h]e'll grab me, he'll pull me down the hall, he'll block me so I can't leave the room, throw me on the bed, push me against the wall." Again, no testimony was elicited from plaintiff that she sustained any injuries as a result of defendant's conduct.

Reprehensible and highly offensive behavior, however, is not necessarily sufficient to establish the cruel-and-inhuman- treatment ground for divorce. Plaintiff's uncorroborated [*2]testimony regarding unwanted physical contact was vague and general, and no evidence was adduced from plaintiff regarding the effects, if any, of defendant's conduct on her physical or mental well-being (see Jacob v Jacob, 8 AD3d 725 [2004]; Murphy v Murphy, 257 AD2d 798 [1999]; see also Green v Green, 127 AD2d 983 [1987]; Hage v Hage, 112 AD2d 659 [1985]). In fact, plaintiff denied suffering any injuries as a result of the incident which occurred in the bathroom. Similarly, plaintiff presented no evidence regarding the effects, if any, on her mental well-being of defendant's conduct in entering the bathroom of their residence while plaintiff was showering. While a party seeking a divorce on the ground of cruel and inhuman treatment is not required to produce medical evidence demonstrating the adverse effects of the defendant's behavior (see Ridley v Ridley, 275 AD2d 941 [2000]), the absence of such evidence may be relevant (see Omahen v Omahen, 289 AD2d 890 [2001], lv denied 97 NY2d 613 [2002]). The absence of medical evidence here is particularly telling in light of plaintiff's failure to offer any other evidence tending to demonstrate that defendant's conduct was "harmful to the plaintiff's physical or mental health and makes cohabitation unsafe or improper" (Shou-Tsung Lin, 282 AD2d at 234 [citation omitted]). At bottom, we are left to speculate as to the effects, if any, of defendant's conduct on plaintiff's physical and mental well-being.^[FN1] [*3]

Other evidence militates against the conclusion that plaintiff satisfied the substantial burden the law imposes upon her. The parties were married for 37 years, eight months at the time of trial, a marriage of long duration requiring a high degree of proof of cruel and inhuman treatment (Palin, supra). Plaintiff and defendant continued to reside together in the marital residence through the trial (see Garver v Garver, 253 AD2d 512 [1998]; see also Palin, supra). Moreover, the parties were able to talk to each other in a civilized manner, have dinner together every night, go out for meals and to the movies and attend social functions (see Walczak v Walczak, 206 AD2d 900 [1994]).

In sum, given the long duration of the marriage, the absence of any evidence regarding the effects, if any, of defendant's conduct on plaintiff's physical or mental well-being and the parties' continued residence in the marital home through the trial, the evidence failed to demonstrate, with a high degree of proof, "that the conduct of the defendant so endangers the physical or mental well being of the plaintiff as [to] render[]
it unsafe or improper for the plaintiff to cohabit with the defendant" (Domestic Relations Law § 170[1]).^[FN2]

THIS CONSTITUTES THE DECISION AND ORDER
OF THE SUPREME COURT, APPELLATE DIVISION, FIRST DEPARTMENT.

ENTERED: MAY 22, 2007

CLERK

Footnotes

Footnote 1:Compare Echevarria v Echevarria (40 NY2d 262 [1976] [defendant severely beat plaintiff on two occasions causing bruises and black and blue marks on her face, head and body, and made her "too nervous to work"; plaintiff also obtained an order of protection against defendant]); Zhao v Li (300 AD2d 169 [2002] [defendant's serious misconduct, including spreading false rumors of extramarital affairs, affected plaintiff's physical and mental health, including loss of sleep and nervousness that caused him to lose his job], lv dismissed 100 NY2d 615 [2003]); Van Dyke v Van Dyke (273 AD2d 589 [2000] [counterclaiming defendant granted divorce on grounds of cruel and inhuman treatment where plaintiff hit defendant with frying pan causing injury, threw household items at him and, on one occasion, wrestled him to the ground]); Pompa v Pompa (259 AD2d 338 [1999] [defendant mistreated plaintiff over several years by making false, denigrating accusations, threatening violence and participating in one incident of actual violence, causing plaintiff to suffer from anxiety, palpitations and chest pain]); Bailey v Bailey (256 AD2d 1030 [1998] [defendant physically assaulted plaintiff causing facial and other injuries]); Meltzer v Meltzer (255 AD2d 497 [1998] [defendant violently pushed plaintiff to the floor, an act that caused bruising and resulted in police intervention and in the issuance of numerous orders of protection excluding defendant from the marital residence]); Feeney v Feeney (241 AD2d 510 [1997] [defendant's abusive conduct forced plaintiff to flee the marital residence on several occasions, causing her to suffer anxiety and depression]); Stoothoff v Stoothoff (226 AD2d 209 [1996] [defendant denigrated plaintiff, threatened her and committed an act of physical abuse and intimidation, causing her decreased appetite, lost sleep, nausea, stress, and anxiety]).

Footnote 2:Plaintiff's testimony regarding defendant's attitude about plaintiff's family and defendant's control of the family finances demonstrates, at most, "strained, unpleasant relations and incompatibility" (Wikiera v Wikiera, 233 AD2d 896 [1996]).

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June 03, 2007

Make Sure Your Lawyer Follows the Rules!!!!

Posted By Brian Perskin

Make Sure Your Lawyer Follows the Rules!!!!

In a recent case the appellate division dismissed a divorce action, because the lawyer failed to file the proper paper work in a timely fashion. As the Court pointed out in Farkas v. Farkas, rules about time are meant to be taken seriously. Your lawyer cannot just say he or she was too busy, or there was a mistake by a paralegal. All too often litigants here the Judge say : settle judgment of divorce with findings of fact and conclusions of law within 60 days or your action will be deemed dismissed. Well guess what happened?....... continue reading

Order and judgment (one paper), Supreme Court, New York County (Phyllis Gangel-Jacob, J.), entered June 23, 2005, awarding plaintiff $750,000 with interest from August 6, 2003, reversed, on the law, without costs, the judgment vacated and the claim underlying the judgment dismissed as abandoned pursuant to 22 NYCRR 202.48(b).

The Court of Appeals has recently made it clear that "statutory time frames - like court-ordered time frames - are not options, they are requirements, to be taken seriously by the parties" (Miceli v State Farm Mut. Auto. Ins. Co., 3 NY3d 725, 726 [2004] [citation omitted], following Brill v City of New York, 2 NY3d 648 [2004]). Thus, where a statute or court rule prescribes a limited time frame in which to take a procedural step in litigation, and states that a party's failure to act within that time frame will be excused only upon a showing of "good cause," such a showing requires demonstrating, as the dissent puts it, "more . . . than [the] merit . . . [of] the underlying application and a lack of prejudice to the other party." This bench is unanimous in holding that this principle applies in the instant case, in which plaintiff failed to comply with the 60-day time frame for the submission of a judgment to the court for signature (Uniform Rules for Trial Cts [22 NYCRR]
§ 202.48[a], [b]). Because plaintiff has failed to show good cause for her failure to comply with the time frame set forth in the Uniform Rules, we are constrained to reverse and vacate the judgment.

The dissent, while agreeing that a showing of "good cause" in this case requires plaintiff to provide "[a] satisfactory explanation' for not meeting the 60-day time frame of 202.48," seems to hold that this standard is satisfied wherever the judgment in question arises from a "complex matrix of litigation" and the adverse party is, colloquially speaking, a "bad guy" (a term that indisputably applies to defendant). In view of these purportedly "unique circumstances," the dissent deems excusable the entirety of plaintiff's four-and-a-half-year delay in submitting a judgment, even though the only reason the dissent can find for plaintiff's last 21 months of delay is that she was actively litigating other issues against defendant, and (due to defendant's wrongful conduct) could not have immediately enforced the judgment in any event. Not only does the dissent not adduce any specific factor that impeded plaintiff's ability to submit [*2]a judgment during the final 21 months of the period at issue, the record contains an admission by plaintiff's counsel that the failure to timely submit a judgment was the result of counsel's own "oversight." In our view, excusing plaintiff's failure to comply with the 60-day time frame under these circumstances is tantamount to abolishing the requirement of "good cause" in any case in which the court finds it distasteful to enforce the rule. We see no warrant for such a departure from the approach mandated by the Court of Appeals' recent case law.

This appeal arises from a bitterly contested divorce action that was commenced in 1991. One of the matters at issue was a debt the parties owed to Chemical Bank, based on an equity line of credit defendant husband had obtained by pledging as security the cooperative shares assigned to the marital residence. Chemical Bank commenced a foreclosure action against the parties to recover this debt in 1994. The April 1999 judgment of divorce directed defendant to pay all sums due Chemical Bank within 30 days, failing which "plaintiff [wife] shall be entitled to enter a money judgment against defendant for the total amount due and owing to Chemical Bank without further order."

Defendant did not obey the court's directive to pay the parties' debt to Chemical Bank. Accordingly, in June 2000, plaintiff moved for entry of a money judgment in her favor against defendant in the amount of $984,401.17, which was then the amount Chemical Bank claimed the parties owed it. By order dated October 13, 2000, and entered October 17, 2000, Supreme Court granted this application, providing that "plaintiff may settle the judgment thereon." The relevant decretal paragraph further provided that, "[u]pon plaintiff's suggestion, such judgment may contain language staying execution thereon pending determination or other disposition of the Chemical Bank foreclosure action."

Although the order granting plaintiff's application for judgment in the Chemical Bank matter was entered on October 17, 2000, it was not until May 2, 2005 - four and a half years later - that plaintiff finally served defendant with a notice of settlement and a proposed judgment. The proposed judgment recited that plaintiff and Chemical Bank had settled the foreclosure action for $750,000.00 on or about August 6, 2003. Apparently based on this development, the proposed judgment was in the principal amount of $750,000.00 (rather than $984,401.17, the amount stated in the October 2000 order), with interest to run from August 6, 2003. Defendant opposed entry of the proposed judgment, arguing that it was untimely under 22 NYCRR 202.48(a), more than 60 days having passed since entry of the order directing settlement of the judgment ^[FN1]. Therefore, defendant argued, the action should be deemed abandoned pursuant to 22 NYCRR 202.48(b), since plaintiff had not shown "good cause" for the delay ^[FN2]. On June 20, 2005, the court, without making any finding on the "good cause" issue, signed the judgment [*3]submitted by plaintiff without material amendment, and it was entered on June 23, 2005 ^[FN3]. Defendant now appeals.

Although we agree that there was arguably good cause for delaying settlement of the judgment until after the Chemical Bank foreclosure action was settled in August 2003, the record reveals no justification for plaintiff's failure to submit a judgment for an additional year and nine months thereafter. The relevant portion of the October 2000 order granted plaintiff's application for judgment in the amount of the parties' debt to Chemical Bank, which was being litigated in the foreclosure action. While the foreclosure action was still pending, the amount of the debt to Chemical Bank was undetermined (as recognized by the October 2000 order itself), and, therefore, plaintiff's failure to submit a judgment during the foreclosure action's pendency was at least arguably justifiable. However, once the foreclosure action was settled on or about August 6, 2003, the amount of plaintiff's indebtedness to Chemical Bank was finally determined, and no reason remained for plaintiff to continue to delay her submission of a judgment.

As the dissent appears to recognize, plaintiff's failure to comply with the clear mandate of the Uniform Rules is not justified either by the lack of prejudice to defendant from the late submission of the judgment or by the merit of the claim on which the judgment is based (cf. Brill, 2 NY3d at 652 ["good cause" for a late summary judgment motion under CPLR 3212(a) "requires a showing of good cause for the delay in making the motion - a satisfactory explanation for the untimeliness - rather than simply permitting meritorious, nonprejudicial filings, however tardy"]). The dissent nonetheless claims to find the "good cause" required to save plaintiff's judgment in the circumstance that, throughout the period in question, the parties were embroiled in "strenuous legal battles fought simultaneously on a variety of fronts," and that such continuing litigation was necessitated by defendant's bad faith efforts to avoid paying his fully adjudicated legal obligations to plaintiff. While this is certainly true (indeed, defendant does not deny it), it does not change the fact that only the Chemical Bank foreclosure action had any bearing on plaintiff's ability to settle the judgment here at issue. We do not see how the other matters the parties were litigating during this period - however urgent they were, and however inexcusable defendant's misconduct — can be deemed to constitute "good cause" for plaintiff's counsel's failure to submit a judgment within 60 days after the settlement with Chemical Bank (if not earlier).

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Divorce Preparation: Step 9 - Avoid additional debt or major purchases