JAY L. LUBETKIN v. MARLA LUBETKIN

 

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-1712-03T51712-03T5

JAY L. LUBETKIN,

Plaintiff-Appellant/Cross-Respondent,

v.

MARLA LUBETKIN,

Defendant-Respondent/Cross-Appellant.

__________________________________________

 

Argued October 19, 2005 - Decided

Before Judges Stern, Grall and Sapp-Peterson.

On appeal from Superior Court of New Jersey,

Chancery Division, Family Part, Essex

County, FM-07-67-98.

Cary B. Cheifetz argued the cause for

appellant/cross-respondent (Ceconi & Cheifetz, attorneys; Mr. Cheifetz,

of counsel and on the brief; Nancy C.

Richmond, on the brief).

Jacqueline M. Printz argued the cause for

respondent/cross-appellant (Greenbaum, Rowe, Smith, Ravin, Davis & Himmel, attorneys; Ms. Printz, of counsel; Dina M. Vanides, on the brief).

PER CURIAM

Plaintiff Jay Lubetkin appeals and defendant Marla Lubetkin cross-appeals from a post-judgment order in this matrimonial action. Plaintiff contends that the court erred in increasing his child support obligation from $1500 to $5000 per month, failing to credit his voluntary pendente lite payments against the retroactive increase and failing to require his former wife to reimburse the children's accounts. Defendant contends that the court erred in requiring plaintiff to pay only $2500 toward the $9034 she incurred for counsel fees in this post-judgment proceeding.

The motion was decided on October 2, 2003, before and without the benefit of the decisions of this court and the Supreme Court in Caplan v. Caplan, 364 N.J. Super. 68 (App. Div. 2003), aff'd, 182 N.J. 250 (2005). For that reason we reverse the child support order and remand for reconsideration in light of Caplan.

Plaintiff and defendant were married on September 4, 1983. There were two children born of their marriage. Jared was born on May 28, 1987, and Jillian was born on April, 16, 1989. The parties separated on December 15, 1995, and divorced on August 10, 1998.

The final judgment of divorce incorporates the terms of the parties' property settlement agreement. Under that agreement, defendant has primary residential custody of the children and legal custody is shared. Plaintiff's parenting time includes two weekday evenings every week, alternate weekends and four weeks of vacation time.

The parties' agreement set child support for a period of five years. Plaintiff agreed to pay $1500 per month for a period of sixty months commencing on August 10, 1998. "Thereafter [on August 10, 2003], support for the children [was to be] recalculated based upon the Child Support Guidelines." In addition to cash support, plaintiff is obligated to provide medical insurance for the children, pay seventy-five percent of all unreimbursed medical expenses and one-hundred percent of all camp fees and bar and bat mitzvah expenses.

The parties' agreement also requires plaintiff to pay alimony for a term of ten years that expires on August 10, 2008. They agreed to alimony in the amount of $2500 from August 10, 1998 through July 31, 2003, $2000 per month for thirty-six months commencing on August 1, 2003, and $1750 per month for the final twenty-four months of the term.

While defendant remains in the marital residence, plaintiff is obligated to pay the mortgage, real estate taxes, home owner's insurance, monthly maintenance fees, special assessments, water bill and sewer charges. He receives a credit against his alimony obligation for those payments, which he contends amount to as much as $2700 per month. The agreement permits plaintiff to refinance the mortgage on the marital residence but requires him to maintain a minimum equity.

This post-judgment litigation commenced in 2003. On April 10, 2003, defendant filed a motion seeking an increase in child support. She also sought an order compelling plaintiff to pay support through probation, purchase furniture for the former marital residence, pay for home repairs, contribute to work-related childcare or the cost of transporting the children, pay all tuition for private high school, produce proof of insurance and pay defendant's counsel fees and costs for the motion. On May 13, 2003, plaintiff filed a cross-motion seeking discovery, compelling defendant to cooperate in refinancing the marital residence and requiring defendant to account for and repay funds she withdrew from the children's bank accounts. The trial court heard argument on the motion and cross-motion on June 20, 2003 and directed defendant to provide child support guidelines calculations and additional argument on calculation of support above the guidelines.

The following facts are drawn from the materials submitted on the motion and cross-motion. No testimony was taken. Defendant is forty-eight years old. She and the children continue to live in the marital residence. She has a college education. For a period of time during the marriage she worked in her brother's business and earned $50,000 per year. She was not employed at the time of the divorce and has not had any significant earnings since the divorce. Her 2002 tax return reflected earned income in the amount of $325. She did not anticipate increased earnings in 2003. According to defendant, she cannot work unless she hires a driver to transport the children to their various activities. The children attend private high school. Plaintiff's parents have paid the tuition.

Plaintiff is also forty-eight years old. He is remarried, and his wife is employed. On April 21, 2003, a child was born of plaintiff's second marriage. Plaintiff and his second wife own their home and do not have a mortgage.

Plaintiff is an attorney, and his earnings fluctuate with his law firm's profits. In 1997 he earned $93,818. In 2000 his earned income was $246,646. In 2001 his earned income was $370,034, and in 2002 he earned $262,684. According to plaintiff, his 2001 earnings were atypically high because his law firm settled a class action suit and received a $400,000 fee. He and his three partners not only shared that fee but also recovered another significant past due fee. Plaintiff estimated his income for 2003 at just under $210,000 ($189,402 earned income and $20,000 unearned income). The projection was based upon his unearned income in 2002 and his year-to-date earnings as of May 10, 2003.

Plaintiff has regularly paid expenses for the children and defendant beyond his obligations under the property settlement agreement. For example, between February 2002 and February 2003 he paid approximately $90,000 for expenses such as cell phones, clothing, sports activities, lessons, tickets for sporting and theatrical events, household expenses and defendant's car lease. Defendant did not dispute these additional payments.

Through the generosity of his parents, plaintiff satisfied his obligation to pay all bar and bat mitzvah expenses. And, as noted above, his parents have paid the children's private high school tuition.

On October 2, 2003, after brief argument on the supplemental filings, the motion judge set child support at $5000 per month effective August 10, 2003, the date for modification established by the parties' agreement, with a credit to plaintiff against the retroactive amount for voluntary payments to defendant after May 9, 2003.

The judge explained:

[T]his is not a guideline case. . . .

. . . [I]t is clear based upon the history of the matter that the guidelines should only be referenced by the court and that based upon the economic factors and ability of the parties to meet the lifestyle of the children the court must consider the [statutory] factors . . . .

. . . .

I have no reason to doubt the credibility of Mr. Lubetkin who represents that his current income will approximate $210,000 the year. . . . And if the defendant at year's end is provided with information that would indicate that Mr. Lubetkin's actual earning are not $210,000 then she is free to bring this matter back before the court for an appropriate adjustment.

. . . .

. . . [A]s to imputing income to the defendant . . . the court will comment upon this further. But at $210,000, which I note is represented to be W2 earnings, not taking into account other potential earnings that may accrue to Mr. Lubetkin . . . [the child support of $5000 per month] would put [the parties] pretty much on parity with respect to their particular circumstances. And the court has determined that that is an appropriate amount given the budget submitted and the needs of the children.

I am sure that Mr. Lubetkin will continue to act as he has in the past in good faith. I expect that he will do so.

. . . .

. . . I am not factoring [imputed income to defendant] in at this time. [A]gain, this is not a guideline case.

. . . .

. . . Jay Lubetkin's earnings have been substantially greater than the $210,000. As a matter of equity the court feels that this is an appropriate amount. $210,000 minus $30,000 in . . . alimony results in $180,000. Tax affecting that, let's use a third [as plaintiff's counsel suggested], would bring his income down to $120,000 minus the $60,000 in child support [and] provide each of them with a remainder of $60,000. This is a rough calculation by the court which would [result in a] a reasonable . . . increase in child support.

I note that Mr. Lubetkin argues that [] this is a guidelines case. I find otherwise based upon the history of earnings, the needs of the children and [] payments that [were] made prior to the application . . . .

In a supplemental decision rendered later the same day, the judge found that fluctuations in plaintiff's earnings and his reduced shelter expenses gave him access to additional income. He also found that defendant has the ability to earn additional income. The judge did not quantify either party's actual or imputed additional income. Instead, he concluded that plaintiff's additional income and defendant's untapped potential to earn offset each other. On that basis, the judge concluded that the Lubetkins' total net disposable income exceeded the maximum combined net income addressed by the schedule of child support awards. The judge justified his decision to set child support at $5000 with only a general reference to plaintiff's significant voluntary payments in the past. He denied defendant's request for additional payments for furnishings and expenses for work-related child care. In addition, he directed both parties to provide an accounting of funds removed from the children's accounts and awarded defendant $2500 in counsel fees.

Plaintiff raises the following issues on his appeal:

I. the court erred in failIng to apply the child support guidelines since mr. lubetkin's income combined with that of the defendant's falls within the child support guidelines set forth in appendix ix-a to r. 5:6a.

A. The Court erred in failing to apply the Child Support Guidelines in increasing Mr. Lubetkin's child support obligation from $1,500.00 per month to $5,000.00 per month because Mr. Lubetkin's income combined with that of the Defendant's falls within income levels for which the Child Support Guidelines apply.

B. The Court erred in not identifying the specific needs of the children, which would not be satisfied by a child support obligation calculated according to the Child Support Guidelines, given Mr. Lubetkin's other obligations under the property SETTLEMENT agreement.

II. THE COURT ABUSED ITS DISCRETION BY FAILING TO IMPLEMENT PARAGRAPH 6.1 OF THE PARTIES' PROPERTY SETTLEMENT AGREEMENT IN NOT APPLYING THE CHILD SUPPORT GUIDELINES WHEN RECALCULATING MR. LUBETKIN'S CHILD SUPPORT OBLIGATION; BECAUSE IN DOING SO, IT FAILED TO RECOGNIZE THAT THIS TERM IS PART OF AN "INTEGRATED AGREEMENT" THAT WAS AGREED UPON IN CONSIDERATION FOR OTHER TERMS AND CONDITIONS SET FORTH IN THE AGREEMENT.

III. THE TRIAL COURT ERRED IN NOT IMPUTING A

REASONABLE LEVEL OF INCOME TO DEFENDANT IN CALCULATING MR. LUBETKIN'S CHILD SUPPORT OBLIGATION.

IV. THE TRIAL COURT ABUSED ITS DISCRETION

IN PROHIBITING MR. LUBETKIN TO APPLY[,] AS CREDITS AGAINST HIS NEW CHILD SUPPORT OBLIGATIONS[,] ALL PAYMENTS MADE TO THIRD PARTIES ON BEHALF OF DEFENDANT, THE CHILDREN, OR TO THIRD PARTIES ON THEIR BEHALF, IN ACCORDANCE WITH THE AGREEMENT REACHED BETWEEN COUNSEL.

V. THE COURT ABUSED ITS DISCRETION IN

FAILING TO REQUIRE DEFENDANT TO REIMBURSE THE CHILDREN'S BAR AND BAT MITZVAH GIFT MONIES THAT DEFENDANT UNILATERALLY TOOK FROM THE CHILDREN'S ACCOUNTS.

VI. THE COURT ERRED IN FAILING TO CONSIDER

THAT SUBSTANTIAL SUMS OF MR. LUBETKIN'S NEW CHILD SUPPORT OBLIGATION TO THE DEFENDANT OF $5,000.00 PER MONTH WILL BE SPENT FOR THE BENEFIT OF THE DEFENDANT AND NOT THE CHILDREN.

In addition to responding to the foregoing claims, defendant presents argument in support of her cross-appeal for additional counsel fees.

The findings in this case are not adequate to permit review under the principles established in Caplan v. Caplan, 364 N.J. Super. 68 (App. Div. 2003), aff'd, 182 N.J. 250 (2005). Accordingly, we must remand.

The following findings are essential to application of Caplan under the circumstances of this case. The trial judge properly concluded that the Lubetkins' agreement to reconsider child support under the guidelines after sixty months eliminated the need for a showing of changed circumstances under Lepis v. Lepis, 83 N.J. 139 (1980). The judge also properly concluded that an agreement to apply the child support guidelines is an agreement to apply all of the relevant principles, including the paragraph that requires a court to "supplement the guidelines-based award with a discretionary amount" based on net income in excess of the highest combined net income included in the schedule of child support awards, "and the factors specified in N.J.S.A. 2A:34-23." Child Support Guidelines, Pressler, Current N.J. Court Rules, Appendix IX-A to R. 5:6A at 2320 (2006); see Caplan, supra, 182 N.J. at 266 and 364 N.J. Super. at 85-86; see also Isaacson v. Isaacson, 348 N.J. Super. 560, 581 (App. Div.), certif. denied, 174 N.J. 364 (2002); R. 5:6A.

The judge did not make the findings on the respective income of the parties that are required. "[T]he right to child support belongs to the child or children . . . ." Ordukaya v. Brown, 357 N.J. Super. 231, 240 (App. Div. 2003). A child is entitled to reasonable support commensurate with parental ability to pay. See Caplan, supra, 182 N.J. at 270. The obligation falls upon both parents in accordance with their ability. Martinetti v. Hickman, 261 N.J. Super. 508, 512 (App. Div. 1993); Lynn v. Lynn, 165 N.J. Super. 328, 343 (App. Div.), certif. denied, 81 N.J. 52 (1979). Thus, both "the fairness [and adequacy] of a child support award is dependent on the accurate assessment" of both parents' net income. Caplan, supra, 182 N.J. at 265 (citations omitted).

While the motion judge's conclusion that the Lubetkins' combined net income exceeds the guidelines amount is supported by the record, the judge did not attempt to identify the amount of income that should be attributed to each parent. The "trial court's goal is to calculate a child support award that is in the best interest of the child after giving due consideration to the statutory factors and the guidelines." Id. at 272. And, the guidelines provide rules to address the difficult issues of income determination posed by the facts of this case.

Plaintiff's income fluctuates. The interests of the children and their parents' interests in fair allocation of and certainty with respect to support obligations requires a trial judge to fix reasonable income in such a case. See Lepis, supra, 83 N.J. at 148; Accardi v. Accardi, 369 N.J. Super. 75, 91-92 (App. Div. 2004).

Under the guidelines, absent evidence that the approach is not reasonable under the circumstances, income that "is sporadic or fluctuates from year-to-year," must be evaluated by averaging that income "over the previous thirty-six months." See Pressler, supra, Appendix IX-B to R. 5:6A at 2327 ("Sporadic Income"). As discussed above, plaintiff argued that a portion of his 2001 earned income was attributable to a fee for a class action of a sort that his firm would not likely see again because it no longer does this type of work. Defendant did not dispute that assertion. The judge accepted plaintiff's explanation, and we do not question the judge's finding. Nonetheless, that finding did not support the judge's decision to forego the income averaging approach mandated by the guidelines.

The guidelines permit deviations that are supported by a showing of good cause and define good cause. R. 5:6A. The deviation should be limited to that required by the "good cause" shown. In the context of this case, the evidence of a significant, atypical fee provides "good cause" to exclude plaintiff's share of the atypical fee from the average. It does not establish good cause to disregard the principle of income averaging.

The judge decided to accept plaintiff's good faith projection about his income in 2003. Plaintiff's projection was based upon his earnings between January 1 and May 10, 2003. The guidelines provide a different rule. Where a determination about income is made before information on at least six months of earnings is available, the general rule requires a judge to use the income earned during the prior year. See Pressler, supra, Appendix IX-B to R. 5:6A at 2329 ("Collecting and Verifying Income Information").

The parties should present evidence that facilitates the judge's consideration of the relevant criteria. In the past we have noted the parties' obligation to provide the court with the information needed to address the relevant legal standards. Storey v. Storey, 373 N.J. Super. 464, 474-75 (App. Div. 2004).

The judge was also required to consider defendant's capacity to earn. While the record is sparse on this point, there was no dispute that defendant is college educated and worked at some point during the marriage earning as much as $50,000 per year. This undisputed evidence was sufficient to require imputation of income. Defendant's education, work experience during the marriage and the ages of the Lubetkins' children are relevant factors. See Pressler, supra, Appendix IX-A to R. 5:6A at 2310 ("Imputing Income to Parents"). Any increase in the cost of transportation for the children attributable to defendant's employment should be deducted from imputed income if she does not work or added to the basic child support award if she works. Id. at 2308 ("Expenses That May Be Added to the Basic Child Support Obligations").

The judge must make specific findings to quantify the children's needs beyond the basic child support and in light of the parents' income beyond the guidelines amount. Caplan, supra, 182 N.J. at 266, 271; see also Caplan, supra, 364 N.J. Super. at 86. The voluntary support that plaintiff has paid in the past is evidential but not conclusive of either plaintiff's ability to pay or the children's needs. See Caplan, supra, 182 N.J. at 271. In this case plaintiff's additional payments included some expenses not readily identified as support for the children and others not likely to reoccur. Loro v. Del Colliano, 354 N.J. Super. 212, 225-26 (App. Div.), certif. denied, 174 N.J. 544 (2002); Isaacson, supra, 348 N.J. Super. at 585; Zazzo v. Zazzo, 245 N.J. Super. 124, 131 (App. Div. 1990), certif. denied, 126 N.J. 321 (1991).

When assessing needs and ability to pay, the judge should consider related provisions of the Lubetkins' settlement agreement. The Lubetkins' agreement requires plaintiff to pay the full cost of camp and temple fees and seventy-five percent of unreimbursed medical expenses. Those expenses should not be double counted and should be recognized when assessing plaintiff's disposable income. Caplan, supra, 182 N.J. at 262.

Plaintiff argues that his child support should be reduced because he pays shelter expenses. These payments are credited against his alimony obligation. So long as the shelter expenses are deducted from plaintiff's gross income and included in defendant's gross income, no further adjustment of child support is appropriate.

Our review of the record convinces us that the remaining arguments raised are without sufficient merit to warrant extended discussion in a written opinion. R. 2:11-3(e)(1)(E).

The judge's order does not preclude plaintiff from seeking further relief if defendant fails to produce an accounting that establishes that she used the funds she withdrew from the children's account for their benefit. See Elkin v. Sabo, 310 N.J. Super. 462, 474 (App. Div. 1998). Similarly, we see no abuse of the trial judge's broad discretion in setting the counsel fee award or providing credits for voluntary payments. See Loro, supra, 354 N.J. Super. at 227. Because respective ability to pay is relevant to counsel fees in a family court matter, the judge may reconsider the award after making specific findings on the parties' respective income. See R. 5:3-5(c).

 
Affirmed in part and reversed in part and remanded for reconsideration of the child support amount. We do not retain jurisdiction.

Assuming that plaintiff's share of the unusual class action fee was a full, one-quarter share of the $400,000 award, then an adjustment of $100,000 would bring his 2001 earned income to $270,034. The adjusted amount is consistent with plaintiff's earned income in 2000 ($246,646) and 2002 ($262,684) and quite inconsistent with his projected earned income for 2003 ($189,402). The analysis, at least based on this record, suggests that income averaging, with adjustment for anomalies in 2001, may be a reasonable approach to fixing plaintiff's earned income.

With defendant's alimony set to expire, it would appear that a return to the workforce would serve not only the children's interest through fulfillment of her obligation to provide support but also her interests.

By way of example, we note that plaintiff's list of payments that comprise the $90,000 in voluntary contributions include items such as bat mitzvah invitations, clothing for the service for the child and mother, and payments on the mother's car lease.

(continued)

(continued)

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A-1712-03T5

January 4, 2006