IN THE MATTER OF LORI A. MUNSON

 

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-2745-05T12745-05T1

IN THE MATTER OF

LORI A. MUNSON, DECEASED.

_________________________________________________

 
Argued telephonically October 19, 2006 - Decided November 30, 2006-

Before Judges Payne and Lihotz.

On appeal from Superior Court of New

Jersey, Chancery Division-Probate Part,

Morris County, TT0727-95.

Joseph C. Nuzzo, attorney for appellant

Craig Munson.

Stephen E. Samnick, attorney for respondent

Lisa Salberg, Administratrix ad Prosequendum.

PER CURIAM

In this probate matter, husband Craig Munson ("Munson") appeals from an order of a judge of the Chancery Division, Probate Part granting summary judgment against him, dismissing his counterclaims, and ordering that the proceeds of the settlement of a "wrongful death" action instituted against the National Institutes of Health (NIH) as the result of the death of his wife, Lori Munson, be distributed to decedent's two children pursuant to the provisions of the Wrongful Death Act.

N.J.S.A. 2A:31-4, which governs the distribution of the amount recovered in suits for wrongful death, provides:

The amount recovered in proceedings under this chapter shall be for the exclusive benefit of the persons entitled to take any intestate personal property of the decedent, and in the proportions in which they are entitled to take the same. If any of the persons so entitled were dependent on the decedent at his death, they shall take the same as though they were sole persons so entitled, in such proportions, as shall be determined by the court without a jury, and as will result in a fair and equitable apportionment of the amount recovered, among them, taking into account in such determination, but not limited necessarily thereby, the age of the dependents, their physical and mental condition, the necessity or desirability of providing them with educational facilities, their financial condition and the availability to them of other means of support, present and future, and any other relevant factors which will contribute to a fair and equitable apportionment of the amount recovered.

On appeal, Munson claims that (1) the judge erred in distributing all of the settlement proceeds pursuant to N.J.S.A. 2A:31-4, since the settlement included a survivorship claim that was not governed by the wrongful death statute; (2) he, like decedent's children, was dependent upon decedent and entitled to his share of the wrongful death proceeds, and the court erred in not considering his claim; and (3) his counterclaims should not have been dismissed. We affirm.

Munson was married to decedent for approximately six months commencing in late 1994 and ending in early 1995 when she lapsed into a coma and died as the result of complications arising from hypertrophic cardiomyopathy, a genetic heart condition. Decedent had previously been married to John E. Titus, Jr. Two children were born of that prior marriage: John E. Titus, III, born on May 4, 1982, and Stacy A. Titus, born on July 5, 1984. Stacy suffers from the same heart condition that afflicted her mother.

Titus and decedent divorced in January 1989. At the time of the divorce, they entered into a property settlement agreement (PSA) that made the children irrevocable beneficiaries of any life insurance policies obtained by either through their employment. At the time of decedent's death, she held two policies, one non-contributory and one contributory, obtained through her employment at Exxon, with death benefits of $34,000 and $183,600, respectively. Because no beneficiary designation appeared on either, Munson, who was then unaware of the terms of the PSA, received payment of the proceeds of both policies, plus interest. However, after being informed of the PSA, Munson took the position that the larger, contributory, policy was not encompassed by its terms, and he utilized a substantial portion of the proceeds of that policy to pay off the couple's home mortgage and to satisfy other expenses, leaving only a total of $111,000 for the benefit of the children. The marital residence was eventually sold by Munson, and he received the proceeds of that sale.

In subsequent litigation between Munson and the Flanigans, the children's custodial maternal grandparents, the Supreme Court determined that the entire amount of the insurance should have been held in trust by Munson for the benefit of the children, that he had been unjustly enriched by the receipt of the money, and that a constructive trust would be imposed upon the amount of the unjust enrichment. Flanigan v. Munson, 175 N.J. 597, 608-11 (2003). The matter was remanded to determine the amount of the constructive trust. The Flanigans and Munson later settled their dispute pursuant to an agreement that required Munson to make an up-front payment of $75,000 by July 11, 2003, and then to pay the remaining sum of $12,000 at a rate of $100 per month. Although no interest was to be charged for the period that the money had been withheld prior to the settlement, upon default, the remaining principal and all interest was to be paid. A default occurred after payment of $75,100 by check dated August 22, 2003. The remaining amounts owed by Munson pursuant to the settlement remained outstanding at the time that the order from which the present appeal arises was entered.

In addition to the litigation regarding the insurance, on August 14, 1996, a consent order was entered permitting decedent's sister, Lisa Salberg, to be substituted for Munson "for purposes of bringing a Wrongful Death, Survivorship and Mal Practice [sic] Action" on behalf of the Estate and its beneficiaries, Munson and decedent's two minor children. J. Lee Tilson, a Michigan lawyer handling other similar claims, was retained by Salberg to pursue the litigation against the NIH, and on May 9, 2000, Munson signed a retainer agreement permitting the Michigan attorney to pursue "separate damages" that local counsel in Maryland had advised "are recoverable, by a surviving spouse."

A settlement of the NIH suit in the amount of $125,000 was reached, from which the Michigan attorney deducted only his pro rated expenses. The settlement agreement and general release of claims executed in connection with the suit against the NIH did not specify the causes of action to which the settlement proceeds applied. Following receipt by Salberg of the net settlement proceeds in the amount of $91,781.72, on August 20, 2004 the proceeds were transferred to counsel for Munson and placed in his trust account. Thereafter, Munson moved in the probate action for an order of summary judgment requiring distribution of those proceeds, for additional discovery, and for an order permitting the assertion of amended counterclaims alleging various causes of action arising out of the alleged wrongful withholding of information by Salberg regarding the litigation and settlement. Salberg cross-moved for summary judgment on the children's behalf.

The parties initially took the position that the proceeds of what they referred to as the "wrongful death" action were distributable pursuant to the laws of intestate succession, N.J.S.A. 3B:5-1 to -14, and the focus of the litigation became whether Munson, as decedent's spouse, would receive the increased share of the funds authorized by the statute in its current form, to which he claimed entitlement, or the lesser amounts authorized at the time of decedent's death. However, when the parties became aware of the distribution provisions of the wrongful death statute, N.J.S.A. 2A:31-4, all attention turned to it. In that connection, Munson argued that he, like the children, was dependent on decedent at the time of her death, claiming as he had when seeking the proceeds of the contributory insurance policy issued to decedent while at Exxon, that without decedent's income, he would be unable to pay the mortgage on the couple's house. See Flanigan, supra, 175 N.J. at 602, 611.

At oral argument on the cross-motions, counsel for Munson at several points conceded the applicability of N.J.S.A. 2A:31-4, for instance, stating while discussing the form of his proposed order, that when counsel representing the interests of the children

brought the [wrongful death] statute to - out, and I read his moving papers and I read the statute and I read the case [construing it], I said he's right. And I said it in my responsive papers. He's right on that point.

So I'll be happy to redraft the order. I mean if that's what you're asking, Judge.

However, Munson's counsel argued that the children, who had now reached their majority, were not decedent's only dependents and that Munson was "dependent on her, too." Opposing counsel countered this argument by noting that in Contento v. Contento, 210 N.J. Super. 601 (Ch. Div. 1986), where the wife's right to recovery as a dependent as the result of the death of her husband had been recognized, the parties' marriage had been of ten years' duration, and there were no children. In contrast, in the present case, Munson's marriage to decedent had lasted less than six months, and decedent had left children age eleven and thirteen. Salberg's counsel claimed: "The entitlement of the children is profound. Their right to take to the exclusion of Munson seems mandatory."

In a written opinion issued after oral argument of the cross-motions, the probate judge noted that Munson had conceded "that the Wrongful Death Statute and the Contento case are applicable to the case at bar," and he held that John and Stacy Titus, the children, were entitled to recover the balance of the settlement.

On appeal, Munson argues that the judge erred in not allocating a portion of the settlement to decedent's survivorship claim pursuant to the Survivor's Act, which would then have been distributed in accordance with the laws of intestacy. N.J.S.A. 2A:15-3; see also F.F. v. G.A.D.R., 331 N.J. Super. 23, 27-29 (App. Div.) (discussing causes of action for survivorship and wrongful death and the disposition of recoveries under the two legal theories), certif. denied, 165 N.J. 530 (2000). However, as we have noted, at the hearing before the probate judge, Munson expressly conceded the sole applicability of the Wrongful Death Act to the distribution of the settlement proceeds. The apportionment sought on appeal was never requested from the probate judge. We therefore decline to consider Munson's argument now. Nieder v. Royal Indem. Ins. Co., 62 N.J. 229, 234 (1973).

Contrary to Munson's arguments, we find no error in the court's determination to award the full amount of the settlement to decedent's two children. N.J.S.A. 2A:31-4 vests the court with the authority to make a "fair and equitable apportionment of the amount recovered" among decedent's dependents, taking into account, among other considerations, their age, educational and financial needs, and "other relevant factors which will contribute to a fair and equitable apportionment of the amount recovered." We are satisfied, given the short duration of Munson's marriage, the ages and needs of the children, and Munson's virtual abandonment of the children following the death of their mother, that the statutory goal was accomplished in this case, and that the court's exercise of its discretion was properly grounded in the facts and equities of the matter. Jurman v. Samuel Braen, Inc., 47 N.J. 586, 602 (1966). Although the probate judge did not hold an evidentiary hearing on the issue of dependency, Munson has offered no evidence, other than that already before the court, to support his dependency claim. In light of the extent to which the facts of this matter have been aired during the course of litigation commencing more than ten years ago in 1995, and the absence of a proffer of additional facts requiring consideration before a distribution could be made, we find such a hearing to have been unnecessary.

As a final matter, we reject Munson's arguments that relate to his counterclaims, determining that they depended solely upon his right to recover proceeds from the settlement, a right that was properly denied by the probate judge.

 
Affirmed.

The reference was to Contento v. Contento, 210 N.J. Super. 601 (Ch. Div. 1986).

(continued)

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A-2745-05T1

November 30, 2006