In its March 21, 2018 decision in Elkins v. Mizrahi, the Appellate Division, Second Department, struck a credit issued at the time a father’s new child support obligation was established. That determination tacitly affirmed the new obligation, after a lower court found that a prior waiver of future child support, to which both parties had stipulated, violated public policy. However, the same lower court had previously discharged prior arrears and terminated the father’s support obligation in the order entered that had incorporated that prior stipulation of the parties.

The parties, who have three children together, were divorced in March 2008. In 2014, the parties entered into a stipulation whereby they agreed, inter alia, that the father would pay the mother a lump sum of $50,000.00 in full satisfaction of his accrued child support arrears, which, at that time, exceeded $70,000.00, and that the father’s child support obligation would be terminated going forward. The mother received the $50,000.00 payment on November 21, 2014.

In an order dated January 29, 2015, Nassau County Family Court Judge Ellen R. Greenberg gave effect to the stipulation, terminated the father’s future child support obligation, and directed that the father’s remaining child support arrears of $21,385.46 be deemed satisfied.

Continue Reading Waiver of Future Child Support Voided, But Miscalculated Credit Struck

What happens on divorce when during the marriage, the marital residence that had been owned by one spouse prior to the marriage is conveyed during the marriage to the parties jointly? That was the issue addressed by the Appellate Division, Second Department, in its decision this month in Spencer-Forrest v. Forrest.

The parties were married on March 31, 1984. There were no children of the marriage, but children from each of the parties’ prior marriages resided with the parties in the marital residence during the children’s respective minorities. Both parties were employed for the majority of the marriage, and the wife provided care for the husband’s children, who were younger and resided in the marital residence longer than her children.

The husband had purchased the marital residence prior to the marriage, and transferred the property to himself and the wife as joint tenants in 1989. Other than the marital residence, the parties’ assets were held in their respective names. Both parties contributed to the household expenses, although the husband contributed a larger sum to household expenses and maintenance of the marital residence, and the wife ceased financial contributions in 2006 or 2007, after she retired.

In August, 2012, the wife commenced this action for a divorce and ancillary relief. The wife was 68 years old and the husband was 67 years old at the time of trial.

Except for the marital residence, Nassau County Supreme Court Justice Stacy D. Bennett divided the marital property) equally (other than the vehicles and personal items) regardless of the party holding title. As to the residence, Justice Bennett awarded the wife 20% of the appreciation in the value of the marital residence from 1989 (when the husband conveyed the home to the parties jointly) through the date of the commencement of the action, an award amounting to $30,000. The court declined to award the parties credits sought for assets allegedly secreted or wasted by the other party and denied the wife an award of maintenance.

Continue Reading When One Spouse Transfers Sole Title to the Home to Both Spouses Jointly

In the first New York appellate decision to rule on the issue, the Appellate Division, Second Department held in its February 28, 2018 opinion in Spencer v. Spencer, that violations of matrimonial action “Automatic Orders” can be grounds for a finding of civil contempt, but an application for that relief must be made before the entry of the judgment of divorce.

The facts are straightforward. Following the entry of her November, 2015 divorce judgment, the wife discovered that while the divorce action was pending, her husband sold a warehouse in Brooklyn, without the knowledge or consent of the wife or the court. He netted $300,000.00.

Under Court Rule 22 N.Y.C.R.R. §202.16-a, the listed orders are binding upon a plaintiff upon commencement of the matrimonial action and upon a defendant upon service of the summons or summons and complaint (see Domestic Relations Law § 236[B][2][b]). Automatic Orders seek to preserve the status quo while the action is pending, by prohibiting the transfer or encumbrance of real and personal property and retirement funds, the accumulation of unreasonable debt, and changes in beneficiaries on existing health and life insurance policies.

The wife, then, sought to hold the husband in civil contempt (Judiciary Law §753). After a hearing, Richmond County Supreme Court Justice Catherine M. DiDomenico granted that motion. Justice DiDomenico directed that, unless the defendant purged the contempt by immediately paying $150,000 to the wife, the husband would be incarcerated every weekend for a period of six months. The husband appealed.

Continue Reading Contempt Available for Violators of “Automatic Orders”

In its February 7, 2018 decision in Matter of Koegel, the Appellate Division, Second Department, held that defects in the acknowledgment forms in a 30-year old prenuptial agreement, i.e., the failure of the notary to recite that he knew the signatory, could be cured following the death of one of the parties.

Irene and John Koegel were married in August, 1984. Mr. Koegel had been widowed twice before marrying Irene. Mrs. Koegel had been widowed in July 1983. The Koegels were married for more than 29 years at the time of Mr. Koegel’s death in 2014. A month before their marriage, the Koegels had executed a prenuptial agreement.

Among other provisions the agreement provided that the parties ‘would not make a claim as a surviving spouse on any part of the estate of the other. Further, they irrevocably waived and relinquished ‘all right[s] to . . . any elective or statutory share granted under the laws of any jurisdiction.’ Both the decedent and Irene desired that their marriage ‘shall not in any way change their pre-existing legal right, or that of their respective children and heirs, in the property belonging to each of them at the time of said marriage or thereafter acquired.’

Continue Reading Defective Acknowledgment in Prenuptial Agreement Cured After 30 years

Despite repeated efforts to bring predictability and consistency to temporary support awards, that goal remains elusive. Consider the December, 2017 decision of the Appellate Division, Third Department, in Rouis v. Rouis.

The parties were married in 1993 and had two children. After the husband departed the marital residence, the wife commenced this action for divorce in 2014. Applying the pre-2015 temporary maintenance formula on the wife’s motion for temporary relief, Sullivan County Supreme Court Justice Mary MacMaster Work granted the wife, among other things, temporary maintenance ($1,958 per month) and child support ($2,720 per month) and required the husband to pay for the carrying costs and upkeep of the marital home ($4,859 per month), private school for the youngest child ($848 per month), health insurance for the family ($1,921 per month), interim counsel fees ($10,000) and the wife’s vehicle and fuel costs ($644 per month). The husband appealed.

Recognizing that the combined monthly awards amounted to an annual award of $155,400 plus $10,000 in interim counsel fees, to be paid from the husband’s annual gross income of $183,300.50 (the wife’s pre-award income was $11,700.00), the Third Department agreed that the temporary awards were excessive and should be modified.

The appellate court noted that the (pre-2015) temporary maintenance formula resulted in a presumptive monthly temporary maintenance amount of $4,387.50. Justice Work also granted the wife’s request that the husband also pay the $4,859 in expenses, including the mortgage, taxes, utilities, insurance and upkeep. Justice Work recognized that it would not be equitable to require the husband to pay full maintenance, child support and all carrying costs on the marital home, and therefor essentially credited the husband for one half of the carrying costs on the home ($2,429.50 per month) by reducing the presumptive maintenance award by that amount, resulting in a temporary maintenance award of $1,958 per month. The lower court also ordered the husband to pay the full monthly carrying costs on the home ($4,859) in which he did not reside. The appellate court noted that when the wife’s vehicle expenses were added ($644 per month), the total combined monthly award was $7,461, plus tuition ($848 per month) and child support. The net effect of Supreme Court’s order was that the husband was ordered to pay the full presumptive maintenance award plus one half of the carrying costs on the home and the wife’s vehicle expenses.

Continue Reading Do Temporary Support Awards Include Marital Residence Expenses?

Where the results of a 2007 prenuptial agreement waiver of maintenance would be a risk that a mother of three children would become a public charge, the agreement would be set aside for being unconscionable at the time of divorce. So held the Appellate Division, Second Department, in its January 10, 2018 decision in Taha v. Elzemity.

The parties were married in 2007, and had three children. Shortly before their marriage, they entered into a prenuptial agreement. The agreement provided, inter alia, that each party waived the right to the other’s separate property in the event of separation or divorce; each party would keep separate bank accounts; and the husband’s maintenance obligation would be limited to a lump sum payment of $20,000.

In 2008, the parties moved into the marital residence, which was purchased with funds from the husband’s bank account, and the deed and mortgage were placed solely in his name.

The husband had been practicing medicine since 1987 and earned approximately $300,000 annually. The wife, who had been employed part-time as a sales person when the parties met, did not work outside the home during the marriage, but dedicated herself to the care of the household and the parties’ children, one with special needs.

In October 2013, the husband commenced this divorce action. The wife moved to set aside the prenuptial agreement, among other grounds, because it was unconscionable. The husband cross-moved for summary judgment determining that the prenuptial agreement was valid and enforceable. After a hearing, Supreme Court, Richmond County Justice Catherine M. DiDomenico found that the prenuptial agreement was not unconscionable. The wife appealed.

The Second Department reversed. It noted that:

An agreement between spouses or prospective spouses should be closely scrutinized, and may be set aside upon a showing that it is unconscionable, or the result of fraud, or where it is shown to be manifestly unfair to one spouse because of overreaching on the part of the other spouse.

Further, the Court stated, “an agreement is unconscionable if it is one which no person in his or her senses and not under delusion would make on the one hand, and no honest and fair person would accept on the other, the inequality being so strong and manifest as to shock the conscience and confound the judgment of any person of common sense.” Moreover:

An agreement that might not have been unconscionable when entered into may become unconscionable at the time a final judgment would be entered.

Here, the appellate court held that the wife met her burden of proof as to unconscionability. Contrary to the lower court’s determination, the wife established that the prenuptial agreement was, at the time this action was before the court, unconscionable.

Enforcement of the agreement would result in the risk of the wife’s becoming a public charge. The wife, who was unemployed, largely without assets, and the primary caregiver for the parties’ young children, would, under the prenuptial agreement, receive only $20,000, in full satisfaction of all claims, even though the husband earns approximately $300,000 annually as a physician. Accordingly, the wife’s motion to set aside the prenuptial agreement should have been granted.

Catherine S. Bridge, of Staten Island, represented the wife. Arnold E. DiJoseph, P.C., of Manhattan, of counsel to Kuharski, Levitz & Giovinazzo, represented the husband.

When negotiating a divorce settlement agreement, the parties should agree on whether or not all child support-related rights and obligations must be redetermined in the event the periodic basic child support obligation is modified.

Take the recent Appellate Division, Second Department, decision in Walsh v. Walsh. There the parties’ settlement agreement was incorporated, but not merged into their 2014 judgment of divorce. Under that agreement, the father was to pay $500 per month in child support.

After the parties divorced, the father began collecting Social Security benefits in addition to his salary, which caused his income to increase by more than 15%. In their agreement, the parties did not opt out of allowing the court to modify the support order, without requiring a party to allege or demonstrate a substantial change in circumstances, where either party’s gross income changed by 15% or more since the order was entered or modified. The mother petitioned for an upward modification of the father’s child support obligation.

Family Court Suffolk County Support Magistrate Kathryn L. Coward granted the upward modification on the basis of the father’s increased income. Calculating the father’s child support obligation under the Child Support Standards Act, the Magistrate awarded the mother $2,074 per month in child support.

The father objected to the Support Magistrate’s order. Family Court Judge Matthew G. Hughes denied the father’s objections. The father appealed. The Second Department affirmed.

Continue Reading Are The Various Types of Child Support Benefits Interrelated?

It is common for the parents of young children when entering a divorce settlement agreement to defer until the children approach college age the determination of the parents’ obligations to contribute. The language chosen to express that deferral may be significant.

The recent decision of the Appellate Division, Second Department, in Conroy v. Hacker, lets us know the agreement language is significant. But we are left asking what would have happened without it.

In Conroy, the parties were married in 1991 and were the parents of two children. Their 1999 divorce judgment incorporated, but did not merge, a 1998 separation agreement. As relevant here, the separation agreement stated:

The parties are not making any specific provisions for the payment of college expenses which may be incurred on behalf of the infant children because of the tender age of said children as of the date of this Agreement. The parties do, however, acknowledge an obligation on each of their parts to contribute to the children’s future college expenses in accordance with their financial abilities at that time.

Continue Reading Enforcing the Divorce Settlement Agreement To Defer Fixing College Obligations

Two recent decisions of the Appellate Division, Second Department, have upheld maintaining a father’s child support obligations despite alleged changes to the nature of the relationship with the child.

in Lovaglio v. Wagner, the father contended that the parties’ then 20-year-old daughter had moved in with him when she entered college. Previously, the daughter resided with the mother in New Jersey since she was 5 years old. However, the father claimed that she began residing with him full-time in Brooklyn after she enrolled in a college in Manhattan during the winter 2015 semester.

After a hearing, Support Magistrate John M. Fasone held that the father failed to establish that the daughter’s residence had changed and denied the father’s petitions to terminate his child support obligation and to receive child support from the mother. In its November 22, 2017 decision, the Second Department affirmed the order of Kings County Family Court Judge Judith Waksberg that had denied the father’s objections to Magistrate Fasone’s order.

Continue Reading Child Support Obligations Do Not Automatically Result Upon Relationship Changes

With litigation so expensive, what claims between former spouses may be heard in small claims court?

In this small claims action, the former wife sought to recover $2,500 from her former husband because he allegedly wrongful retained health insurance reimbursement checks. The wife alleged that she, rather than the ex-husband, had paid the sums to her health providers for which the ex-husband had been reimbursed.

The ex-husband moved to dismiss the small claims action, claiming that the ex-wife’s claims were within the exclusive jurisdiction of the Supreme Court and Family Court. In addition, the ex-husband claimed that, based on the Supreme Court judgment in the parties’ matrimonial action, the ex-wife, whose two prior small claims actions had been dismissed, was precluded from bringing this action under the doctrine of res judicata.

In an order dated November 6, 2015, Nassau County District Court Judge Paul L. Meli, granted the ex-husband’s motion to dismiss this action, concluding that small claims court lacked jurisdiction and that the matter in issue had, in any event, been previously litigated.

Continue Reading Small Claims Court Has Jurisdiction to Determine Claim Between Former Spouses