EILEEN HOWELL v. TIMOTHY HOWELL

 

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-6047-03T26047-03T2

EILEEN HOWELL,

N/K/A EILEEN PETRUCELLI,

Plaintiff-Respondent,

v.

TIMOTHY HOWELL,

Defendant-Appellant.

___________________________________

 

Argued March 20, 2006 - Decided May 31, 2006

Before Judges Lintner, Parrillo, and Gilroy.

On Appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Essex County, FM-07-10267-91.

Nancy C. Richmond argued the cause for appellant (Ceconi & Cheifetz, attorneys; Ms. Richmond, of counsel and on the brief).

Frederick C. Biehl, III, argued the cause for respondent (Soriano, Henkel, Biehl & Matthews, attorneys; Mr. Biehl, on the brief).

PER CURIAM

Defendant, Timothy Howell, appeals from a post-judgment of divorce order entered in the Family Part on May 27, 2004. We affirm.

After thirteen years of marriage, the last three living separate and apart, the parties were divorced on May 11, 1992. The parties have two children, Matthew and Marisa, born November 8, 1984, and December 18, 1987, respectively. During and after the marriage, both parties engaged in the purchase, sale and rental of real estate, and amicably communicated with each other regarding their business investments and their children. Both parties have remarried, and defendant has two children with his present spouse.

The Judgment of Divorce incorporated by reference a Property Settlement Agreement (PSA) dated April 9, 1992. Pursuant to the PSA, plaintiff became the parent of primary residence, and defendant paid child support in the amount of $700 per month for both children. The parties agreed to contribute to the children's college expenses according to each party's ability at that time. The PSA provided that support would continue past each child's eighteenth birthday, up to the twenty-second birthday, so long as the child pursued a college education "with reasonable diligence and on a normally continuous basis." Additionally, the parties agreed that defendant's interest in Belton Corp., a commercial development in Florida, would be shared equally between the parties upon its sale. Defendant's 1992 case information statement (CIS) reported gross earnings of $19,935, and the value of Belton as $185,000.

Eight years post-divorce, plaintiff requested that defendant increase the amount of child support to meet their children's needs, and defendant voluntarily increased the child support payment to $1,000 per month.

On October 18, 2002, plaintiff filed a motion requesting increased child support, allocation of Matthew's college expenses at Boston College, that defendant obtain life insurance, and enforcement of the PSA provision concerning the sale of Belton. Plaintiff asserted that changed circumstances included the maturation of the children and their increased needs, Matthew's enrollment at Boston College, and defendant's substantial increase in income and assets. Following the filing of plaintiff's motion, defendant unilaterally reduced his child support payments to $700 per month.

In December 2002, defendant cross-moved requesting a reduction in child support, particularly for that portion of each year that Matthew attended college; that plaintiff pay Matthew's second semester college expenses; and the parties equally contribute to a Florida tuition pre-payment program for Marisa. Defendant asserted that changed circumstances, warranting a downward modification of child support, included Matthew's attendance at college, as well as the birth and medical conditions of his twin sons with his present spouse. Defendant claimed that his individual annual income was approximately $18,000, and the rental properties owned by himself and his spouse were their sole source of income. Defendant also contended that he should not have to pay child support for Matthew because, besides giving Matthew a car and paying for Mathew's transportation expenses associated with visitation, he contributes to Matthew's college expenses. Regarding Belton, defendant asserted that he no longer held an interest in the company, and Joseph DeLuca, his former business partner, had sold the business without paying defendant any compensation for his interest, because defendant had failed to attend to "business matters" over a period of years.

In opposition to defendant's motion, plaintiff submitted documentation indicating that defendant had underreported his 2001 and 2002 income; the joint income of defendant and his spouse exceeded $300,000 in 2001, and $485,000 in 2002; defendant had failed to list any cash or bank accounts on his CIS; Joseph DeLuca had transferred his stock in Belton to defendant in exchange for defendant's services in operating the business; and defendant's share of Belton in 1992 was valued at $235,000.

On January 10, 2003, determining that plaintiff had made a prima facie showing of changed circumstances, Judge Harris entered an order setting the matter down for a plenary hearing. The judge also entered an order directing defendant to pay $1000 per month in child support and allocating 80% of Matthew's second semester college expenses to defendant. Lastly, the judge directed defendant to provide plaintiff with a copy of the closing statement as well as all the business records of Belton.

In his June 4, 2003 deposition, defendant stated that he and DeLuca had purchased Belton in 1987, for $525,000, of which plaintiff and defendant contributed $125,000. Defendant believed he owned 50% of Belton; however, there was no document confirming his interest. Defendant stated that even though he learned the business had been sold, he did not receive any portion of the sale proceeds from DeLuca, nor was the original $125,000 cash contribution returned. On July 28, 2003, plaintiff served defendant with a notice in lieu of subpoena demanding that defendant appear at the August 5, 2003 plenary hearing, and provide documentation as to all real estate purchased and sold by defendant in 2001 and 2002.

At the hearing, despite the trial court's direction that he produce certain financial documents and having been served with a notice in lieu of subpoena, defendant failed to provide many of the requested documents. Nor did defendant submit documents as to the present value of Belton, or its value at time of sale. Plaintiff briefly examined defendant, during which he attempted to evade answering questions concerning profits from the sale of properties and his financial status. Defendant conceded that he and his spouse had received $264,000 and $135,000 from the sale of two properties in 2002, but the proceeds were not reported on their 2002 tax return because defendant claimed that the proceeds were not subject to taxation. He also testified that he did not know whether his $46,000 share of the proceeds from one of the parties' joint investment properties had been reported. Defendant asserted that he had no recollection of his finances and expenses regarding improvements to certain properties, and asserted that he had complied with discovery requests by providing plaintiff with the relevant documentation. Plaintiff denied receiving the documentation.

At the end of the first day of the hearing, defendant requested that the judge reduce his responsibility for Matthew's college expenses from 80% to 50%. Judge Harris agreed to adjust the allocation to 75% to defendant and 25% to plaintiff without prejudice to further adjustment based upon his ultimate findings concerning each party's income. Defendant returned to Florida that day, and never returned to New Jersey to complete his testimony. On August 8, 2003, defendant transferred ownership of two properties owned by him to joint ownership with his spouse.

On August 21, 2003, Judge Harris entered an order consistent with his oral ruling, re-allocating the college expenses for Matthew's sophomore year, 75% to defendant and 25% to plaintiff. The hearing continued on September 2, 2003, with defendant's counsel participating, even though defendant failed to appear. Defendant did not comply with plaintiff's discovery demands, notwithstanding that plaintiff had served defendant with a notice in lieu of subpoena "tailored specifically to the records." Also, because defendant had not complied with the court's order requiring him to pay 75% of Matthew's college expenses, plaintiff paid 100% of the expenses for Matthew's second year of college. Judge Harris determined that defendant's CIS was incomplete; and although it listed assets in excess of $1.8 million, the judge concluded that based on plaintiff's documentation defendant's real estate assets exceeded $2 million.

Although defendant did not appear on the next scheduled hearing date, September 4, 2003, the hearing continued in his absence. Judge Harris refused to admit documents concerning defendant's medical expenses for his two children because defendant was unavailable for questioning. Plaintiff presented documentation indicating that defendant and his spouse jointly owned ten properties worth over $3 million, and defendant's 2002 income was at least $286,287. Although plaintiff had no personal knowledge of Belton's value, other than the figures provided by defendant during the PSA negotiations in 1992, plaintiff submitted into evidence a contract of sale for Belton dated April 11, 2000, signed by DeLuca with the purchase price reflected as $595,000. Plaintiff also testified that she and her spouse jointly owned real estate assets valued at $1.4 million; plaintiff's individual net worth was $345,000; plaintiff earned $52,695 in 1998, employed as a nurse; and plaintiff presently earned her living by managing and renovating real estate.

At the conclusion of plaintiff's case, Judge Harris determined that defendant had elected not to appear for the continued hearing. The judge requested that defendant prioritize his assets in the event that he ordered a sale to fulfill defendant's support obligations, and that both parties submit proposed findings of fact and conclusions of law.

On May 17, 2004, Judge Harris held a telephonic conference in which he entered an oral decision; however, that conference was not recorded. A confirmatory order was entered on May 27, 2004, directing in pertinent part, that:

1) Defendant's child support obligations be increased to $2,500 per month retroactive to October 23, 2002;

2) Defendant pay plaintiff $117,500 for her interest in Belton Corp., t/a Sampertons, plus pre-judgment interest thereon from the date of October 23, 2002, through May 31, 2004, for a total of $123,336.36, plus post-judgment interest;

3) College expenses for the two children of the marriage be allocated for payment with defendant paying 70% and plaintiff paying 30%;

4) A separate fund be created for the college expenses of Marisa with assets in an initial amount of $25,000 no later than June 15, 2004, with defendant contributing 70% or $17,500 and plaintiff contributing 30% or $7,500;

5) Judgment be entered in favor of plaintiff and against defendant in the amount of $19,846 for reimbursement of those portions of the first and second years' college tuition she paid for Matthew's in excess of her 30% obligation;

6) The proceeds from property located at 2 520 Northeast 19th Avenue, Lighthouse Point, Florida, be released to each party free of any escrow by the court;

7) Defendant's claim that the property located at 1057 Northwest Terrace Road, Stuart, Florida, referred to as Matt's House, be sold to fund his college tuition is denied;

8) The properties commonly known as (i) 681 and 683 Berkeley Street, Boca Raton, Florida, and (ii) 3290 and 3 292 N.E. 5th Drive, Boca Raton, Florida, transferred by defendant to he and his current wife is deemed a conveyance to avoid the claim of the plaintiff, and is hereby set aside, such that title shall be first subject to lien by plaintiff. Any claim by his current wife, Letha Howell, shall be subordinated thereto, and that there is a lien granted on each property in favor of plaintiff and against defendant for all amounts due plaintiff from defendant pursuant to this order; and

9) Each party's request for counsel fees and costs is denied.

On July 7, 2004, defendant filed a notice of appeal of the May 27, 2004, order. On September 10, 2004, Judge Harris reconstructed the record from May 17, 2004, and rendered an oral decision on the record in support of the May 27, 2004, order, setting forth his findings of fact and conclusions of law.

Judge Harris considered and discussed the factors enumerated in N.J.S.A. 2A:34-23a, determining that plaintiff had demonstrated a substantial change in circumstances warranting an upward modification of child support. In his decision on the record, the judge noted defendant's lack of credibility.

[P]laintiff call[ed] as her first witness, the defendant, Timothy Howell. His testimony, however, was unable to be completed by virtue of a representation that was then made that [defendant] was unable to afford the cost of returning to New Jersey to . . . participat[e] in the hearing. This [c]ourt finds . . . the magnitude of [defendant's] holdings and income to be fatal to his credibility. The [c]ourt also notes the lack of clarity in [defendant's] testimony with regard to the . . . various property transactions which serve as the basis of his ongoing income and support [and] although the defendant reports a taxable income in the range of $30,000 jointly with his current spouse, it is clear that he enjoys . . . substantial annual earnings by virtue of a review of the evidence submitted. This [c]ourt finds that the plaintiff's argument that [defendant] had enjoyed income in excess of $300,000 on two consecutive [years], 2001 and 2002, [has] some credibility. Unfortunately, [defendant] has failed to return to this [c]ourt to complete his testimony[,] yet, . . . the documents that the plaintiff submits in which is included [two] uniform residential loan application[s][,] . . . each of these items being received in evidence[,] show[] that [defendant], despite his claim of poverty, enjoys with his current spouse, a[n] estate with assets in excess of $3 million . . . subject to approximately $1 million . . . in obligations. Accordingly, he shows a net worth which approximates $2 million . . . . This is contrary to his arguments at trial and by counsel, it [is] contrary to his claim that he is impoverished and I note that this document dates back to the year 2000, this lends credibility to the arguments advanced by the plaintiff that [defendant] has been less than forthcoming. The [c]ourt also notes that in this document he indicates monthly income in excess of $9,000.

. . . .

This [c]ourt finds that [defendant], himself[,] admits earnings in excess of . . . $229,000 for the calendar year 2002. And, earnings in excess of $137,000 . . . in 2001.

This [c]ourt finds that for the purpose of setting child support, [defendant] enjoys with his present spouse, income in excess of $250,000 by way of available funds to him which would indicate . . . a taxable equivalent of a much greater amount.

Stating that this was not a guidelines case, because the parties' earnings exceeded $150,800, the judge based his child support determination on $250,000 as the estimated annual net income of defendant and his present spouse, and imputed annual earnings of between $50,000 and $55,000 to plaintiff based on her testimony and earning capacity. The judge determined that plaintiff's request for increased child support in the amount of $2,500 monthly was appropriate, even considering that Matthew was away at college.

Considering the contemplated value of Belton at the time of the PSA, the trial judge determined that the business was expected to be worth $1.07 million, with the restaurant and motel rental units worth $250,000; real estate and buildings worth $750,000; and a liquor license worth $70,000. At that time, defendant had 50% interest in the restaurant, motel rental units, and liquor license, and 10% interest in the real estate and buildings, totaling $235,000. The PSA indicates that plaintiff would receive 50% of defendant's share, or $117,500. The judge did not find defendant credible as to his claim that he received nothing from the sale of Belton as there was no supportive documentation or proof. Noting that the property was ultimately sold; DeLuca received $600,000; and it could be argued that defendant should be held accountable for the same amount, $600,000, Judge Harris found that the "documentation at the time of the settlement should control with regard to a valuation." He also determined that defendant's failure to present himself in court and account for the valuation and sale of Belton was a breach of his fiduciary duty owed to plaintiff. Finally, the judge determined that, given the parties' prior ability to communicate and provide for their children, creation of an educational trust account was reasonable.

Defendant raises the following issues for our consideration on appeal:

POINT I

OVERALL, THE TRIAL COURT FAILED TO PROVIDE THE REQUISITE DETAILED ORAL OR WRITTEN FINDINGS OF FACT AND CONCLUSIONS OF LAW TO SUPPORT THE DECISIONS SET FORTH IN THE ORDER OF MAY 27, 2004.

POINT II

THE TRIAL COURT ABUSED ITS DISCRETION AND ERRED IN INCREASING MR. HOWELL'S CHILD SUPPORT OBLIGATION FROM $1,000.00 PER MONTH TO $2,500.00 PER MONTH.

A. THE PLAINTIFF FAILED TO MEET HER BURDEN OF ESTABLISHING "CHANGED CIRCUMSTANCES" UNDER LEPIS V. LEPIS, 83 N.J. 139 (1980)[,] TO WARRANT AN INCREASE IN CHILD SUPPORT.

B. THE TRIAL COURT ERRONEOUSLY IMPUTED INCOME TO MR. HOWELL IN AN AMOUNT IN EXCESS OF $250,000 PER YEAR FOR PURPOSES OF CALCULATING CHILD SUPPORT EVEN THOUGH THE PROOFS PRESENTED AT TRIAL DO NOT SUPPORT THIS DETERMINATION AND THE INDISPUTABLE EVIDENCE REVEALED THAT ANY INCOME REAPED BY MR. HOWELL IN HIS REAL ESTATE VENTURES IS JOINT WITH HIS CURRENT WIFE.

C. THE TRIAL COURT FAILED TO APPLY THE CHILD SUPPORT GUIDELINES IN INCREASING MR. HOWELL'S CHILD SUPPORT OBLIGATION TO $2,500 PER MONTH.

D. IN ARBITRARILY DETERMINING THAT THIS WAS AN "ABOVE THE GUIDELINES" CASE, THE TRIAL COURT FAILED TO IDENTIFY THE SPECIFIC NEEDS OF THE CHILDREN THAT WERE NOT BEING MET BY A CHILD SUPPORT AWARD UNDER THE CHILD SUPPORT GUIDELINES.

E. THE TRIAL COURT ERRED BY NOT GIVING SUFFICIENT CONSIDERATION TO THE FACT THAT THE PARTIES' SON, MATTHEW[,] IS OVER 18 AND IN COLLEGE FULL[-]TIME, WHEREBY THE TOTAL CHILD SUPPORT AWARD SHOULD HAVE BEEN ADJUSTED DOWNWARD.

F. BY INCREASING MR. HOWELL'S CHILD SUPPORT OBLIGATION TO $2,500 PER MONTH, THE TRIAL COURT FAILED TO CONSIDER THE FACT THAT MR. HOWELL HAS TWO CHILDREN FROM HIS CURRENT MARRIAGE WHO ALSO REQUIRE SUPPORT AND HAVE SPECIAL MEDICAL NEEDS.

POINT III

THE TRIAL COURT ABUSED ITS DISCRETION BY ENTERING PARAGRAP[H] 2 OF THE MAY 27, 2004[,] ORDER BY REQUIRING MR. HOWELL TO PAY PLAINTIFF $117,500 AS HER ALLEGED INTEREST IN BELTON CORP., T/A SAMPERTON'S, PLUS PRE-JUDGMENT INTEREST IN THE AMOUNT OF $5,836, PLUS POST-JUDGMENT INTEREST[.]

POINT IV

THE TRIAL COURT ABUSED ITS DISCRETION IN ENTRERING PARAGRAPHS 3, 4, 5 AND 7 OF ITS MAY 27, 2004[,] ORDER WITH RESPECT TO ALLOCATION OF COLLEGE EXPENSES.

A. THE TRIAL COURT ERRED IN ALLOCATING COLLEGE EXPENSES FOR MATTHEW HOWELL BY THE AMOUNT OF 70% TO MR. HOWELL AND 30% TO PLAINTIFF BECAUSE IN DOING SO, IT FAILED TO CONSIDER THE FACTORS SET FORTH IN NEWBURGH V. ARRIGO, 88 N.J. 529 (1982).

B. THE TRIAL COURT ABUSED ITS DISCRETION IN ENTERING PARAGRAPHS 3 AND 4 OF THE MAY 27, 2004[,] ORDER BY ALLOCATING COLLEGE EXPENSES FOR MARISA HOWELL WHO WAS NOT OF AGE TO ENTER COLLEGE AT THE TIME OF THE ENTRY OF THE ORDER.

POINT V

THE TRIAL COURT ABUSED ITS DISCRETION IN ENTERING PARAGRAPH 8 OF THE MAY 27, 2004[,] ORDER[.]

POINT VI

THE TRIAL COURT SHOULD BE RECUSED BECAUSE IT EXHIBITED BIAS AGAINST MR. HOWELL THROUGHOUT THIS POST-JUDGMENT LITIGATION.

"The scope of appellate review of a trial court's fact-finding function is limited. The general rule is that findings by the trial court are binding on appeal when supported by adequate, substantial, credible evidence." Cesare v. Cesare, 154 N.J. 394, 411-12 (1998). Furthermore, "[b]ecause of the family courts' special jurisdiction and expertise in family matters, appellate courts should accord deference to family court factfinding." Cesare, supra, 154 N.J. at 413. We grant substantial deference to a trial court's findings of fact and conclusions of law, which will only be disturbed if they are "'manifestly unsupported by or inconsistent with the competent, relevant and reasonably credible evidence.'" Rova Farms Resort, Inc. v. Investors Ins. Co., 65 N.J. 474, 484 (1974) (quoting Fagliarone v. Tp. of N. Bergen, 78 N.J. Super. 154, 155 (App. Div.), certif. denied, 40 N.J. 221 (1963)). It is against these standards that we address plaintiff's arguments.

It is well established that child support orders are subject to review and modification upon a showing of "changed circumstances." Lepis v. Lepis, 83 N.J. 139, 146 (1980). Even after divorce, children are entitled to benefit from the good fortunes of their parents. W.S. v. X.Y., 290 N.J. Super. 534, 540 (App. Div. 1996). Changed circumstances are not limited to events that were unforeseeable at the time of divorce, and may include, among other things, maturation of the children, increased cost of living, a change in the payor spouse's income, and subsequent illness or disability. W.S., supra, 290 N.J. Super. at 539; Chobot v. Chobot, 224 N.J. Super. 648, 653 (App. Div. 1988).

We have carefully reviewed the record and, in light of applicable law, conclude that defendant's contentions are without sufficient merit to warrant discussion in a written opinion. R. 2:11-3(e)(1)(A) and (E). We determine that Judge Harris properly considered the factors under N.J.S.A. 2A:34-23a, and noting defendant's lack of cooperation in the production of discovery concerning his financial assets and his failure to return to the jurisdiction for the conclusion of his testimony, we see no reason to disturb the judge's decision. A party is not entitled to complain of deficiencies in the record of his or her own making provided the record adequately supports the trial court's decision. Here, it does. We affirm substantially for the reasons stated in Judge Harris' comprehensive and thoughtful oral decision of September 10, 2004.

 
Affirmed.

The guidelines provide for minimum basic child support awards up to a combined net annual income of $150,800. At that limit, the minimum basic child support award for two children is $2,616 monthly. The court is to "apply the guidelines up to $150,800 and supplement the guidelines-based award with a discretionary amount based on the remaining family income . . . and the factors specified in N.J.S.A. 2A:34-23." Pressler, Current N.J. Court Rules, Appendix IX-F to R. 5.6A, Considerations in the Use of Child Support Guidelines, Parents with a Combined Net Annual Income In Excess of $150,800, at 2320 (2006). "Thus, the maximum guidelines award in Appendix IX-F represents the minimum award for families with net incomes of more than $150,800 per year." Ibid.

In addition, the "guidelines shall not be used to determine a support obligation for a child who has reached majority (18 years of age). . . . After a child reaches majority and completes secondary education, a support obligation . . . shall be determined in accordance with N.J.S.A. 2A:34-23 and existing law." Pressler, Current N.J. Court Rules, Appendix IX-A to R. 5.6A, Considerations in the Use of Child Support Guidelines, Support for a Child Who has Reached Majority, at 2322 (2006).

Although not a guidelines case, the judge, in deciding the amount of child support, noted that the $2,500 per month award for both children was less than the minimum basic amount of $2,616 per month under the guidelines for parents having joint incomes of at least $150,800 per year. Judge Harris adjusted the minimum basic award downwards to reflect that Matthew only resides 46% of the year with plaintiff while attending college.

(continued)

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A-6047-03T2

May 31, 2006