LAURA MOFFITT v. GUY MOFFITT

Annotate this Case

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-0573-05T3573-05T3

A-2949-05T3

A-3178-06T3

LAURA MOFFITT,

Plaintiff-Appellant,

GUY MOFFITT,

Defendant-Respondent.

________________________________________________________________

Submitted January 5, 2009 - Decided

Before Judges Lisa, Reisner and Alvarez.

On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Bergen County, Docket No FM-02-1882-02.

Laura Moffitt, appellant pro se in A-0573-05T3.

Sunshine, Atkins, Minassian & Tafuri, attorneys for respondent in A-0573-05T3 (Jay R. Atkins and Kristen Capogrosso, on the brief).

Nancy C. Ferro, attorney for appellant in A-2949-05T3.

Guy Moffitt, respondent pro se in A-2949-05T3.

Laura Moffitt, appellant pro se in A-3178-06T3.

Guy Moffitt, respondent pro se in A-3178-06T3.

PER CURIAM

Plaintiff, Laura Moffitt, has filed three appeals from multiple post-judgment orders. We calendared the appeals back-to-back, and we now consolidate them for disposition in this opinion.

The parties were married on August 21, 1987. They had two children, a daughter, born on February 21, 1988, and a son, born on June 5, 1991. The parties separated in December 2001. Plaintiff filed the divorce action on February 21, 2002. A dual judgment of divorce was entered on May 29, 2003. As a result of extensive negotiations, in which both parties were represented by counsel, the parties entered into a Property Settlement Agreement (PSA), the terms of which were included as numbered paragraphs in the judgment of divorce.

In A-0573-05T3, plaintiff appeals from a number of orders related to the division of non-retirement assets under the PSA. We modify the orders appealed from to (1) provide that the parties shall each pay one-half of the fee of the court-appointed accountant, and (2) vacate the $2700 counsel fee award against plaintiff. In all other respects we affirm.

In A-2949-05T3, plaintiff appeals from various orders pertaining to alimony, child support, tutoring expenses, equitable distribution, and counsel fees. We modify these orders to provide for correction or clarification of the effective date of the support modification and resulting calculation of arrearages. In all other respects we affirm.

The appeal in A-3178-06T3 pertains to distribution of pension plan benefits. We find no merit to the appeal and affirm.

We begin with A-0573-05T3. Plaintiff appeals from three orders, dated February 18, 2005, August 24, 2005, and February 10, 2006, which, among other things: (1) distributed assets in accordance with defendant's proposed approach as endorsed in a report of the court-appointed accounting consultant William Morrison; (2) required plaintiff to pay for fees incurred by Morrison and for defendant's counsel fees and costs relating to that issue; (3) denied plaintiff's motion for the judge's recusal; and (4) entered judgment in favor of Morrison and against plaintiff for the amount of the fees, plus interest. Plaintiff argues that the trial court improperly modified the PSA by the asset distribution and by requiring her to pay Morrison's fees, and that the judge should be recused from any further proceedings, based upon his alleged bias against her.

Key to this dispute is paragraph 17 of the PSA, the initial portion of which described plaintiff's obligation to list the marital home in Franklin Lakes for sale within forty days of April 17, 2003, but which gave her the option before the expiration of that forty-day period to buy out defendant's interest. In that event, the assumed price would be $960,000, and plaintiff would pay defendant one-half of the net equity after subtracting the mortgage balance. The provision prevented plaintiff from using the transfer of retirement assets to count toward the purchase price, thus implying that her share of non-retirement assets could be used. Paragraph 17 further provided:

The parties agree that all assets that are in existence as set forth on Exhibit P-3 will be divided equally and in kind (except for post-Complaint contributions). All retirement assets will be divided in kind either by QDRO or transfer so that a 50/50 division is effectuated. However, the parties acknowledge that defendant will not divide, as part of his asset division, any post-Complaint contributions he made to his 401K or stock purchase plan. Full documentation will be provided by defendant in calculating what is post-Complaint, all other retirement assets of the parties including plaintiff's IRA and defendant's old pension plan will be divided in kind as will all non-retirement assets; . . . .

The dispute that arose with respect to this provision related to the requirement that non-retirement assets would be "divided equally and in kind." After the divorce was finalized on May 29, 2003, plaintiff apparently changed attorneys, and decided to pursue two courses of action. She sought to exercise her option to buy out defendant's interest in the marital home. She also began preparation of a motion seeking to vacate the PSA.

On July 11, 2003, defendant's attorney corresponded with plaintiff's attorney, setting forth, among other things, a listing of non-retirement assets, consisting of five itemized securities or security accounts, stating a total value of $99,473.91 as of June 18, 2003. No mention was made of any anticipated difficulties in distributing these securities in kind or of any need to liquidate them. Defendant's attorney sent another letter to plaintiff's attorney on July 16, 2003, describing a distribution defendant received from his former employer, Aon Corporation, and defendant's offer to send plaintiff a check for $8512.66 as her share, unless she preferred to use those funds toward her buy-out of the marital home.

Defendant's attorney sent a third letter on July 22, 2003, asking for a response regarding the Aon Corporation distribution, and adding: "I would also make the same request concerning the $99,473.91 of non-retirement assets that have to be divided. That in a sense is cash. Divided in half equals $48,736.95 which your client is entitled to." Defendant's attorney asked plaintiff's attorney to respond in writing. He stated that plaintiff was entitled to a total of $57,249.61, and wanted to know whether plaintiff intended to use that amount as a credit toward her purchase of the marital home. He asked for a response, including a payoff figure on the mortgage, so that calculations could be made for the closing on the transfer to plaintiff of the marital home.

Plaintiff's attorney did not respond to any of these letters. However, during this timeframe, plaintiff filed her anticipated motion seeking to set aside the PSA.

During this timeframe, defendant, who had been receiving copies of his attorney's letters to plaintiff's attorney, began liquidating some of the securities. On September 11, 2003, defendant's attorney wrote plaintiff's attorney, advising of the liquidation that was ongoing, and sending documentation to corroborate the amounts received. In one of the accounts, the Ryan Beck account, defendant arranged to have those securities that were not liquid and required sale over a period of time transferred into his name, and obtained a check for the liquid securities, which he tendered to plaintiff. The value of those two components of the Ryan Beck account were not the same, but that would be reflected in an overall adjustment so that both parties received fifty percent of the total amount of these assets.

For the first time, plaintiff's attorney responded to defendant's attorney, by letter of September 11, 2003. She referred to the motion to vacate the divorce judgment and PSA, and expressed her view that defendant acted prematurely in light of the fact that a motion was pending. She did not accept the calculations and checks that were tendered, as unilaterally prepared by defendant. And, she stated that the documentation furnished was inadequate.

Over the next several months, the attorneys continued to exchange correspondence. The motion to vacate the PSA was denied. With respect to the non-retirement assets, plaintiff insisted that the strict terms of paragraph 17 be adhered to, namely that she receive in kind distribution of each asset. Defendant's position was that this was either impossible or highly impractical, because of the illiquidity of some of the securities. Plaintiff argued that she wanted what she bargained for and what was agreed upon, that she wanted stocks as investments, and she wanted her fair share of any built-in capital losses associated with the stocks involved. Defendant's unilateral attempt to give her money instead of one-half of each stock deprived her of these purposes. Defendant insisted throughout these communications that all tax consequences had been taken into account and that plaintiff would be receiving her fifty percent share completely tax free. Defendant suggested that if plaintiff chose, she could use the money to purchase these or other securities as stock investments.

As a result of the impasse, defendant filed a motion in January 2004, which sought to address many issues, including his request for an order "[d]istributing all non-retirement assets of the parties pursuant to the Judgment of Divorce and in the manner as proposed by defendant." In support of his motion, defendant attached his attorney's letters that had been unanswered and contended that plaintiff's attorney was uncooperative. He added:

I reject their argument that it is not an in kind distribution. Some of the assets could not be equally divided; there had to be some calculations made. Never once did they respond to any of our letters to say that they opposed it and say well this is not correct or that is not correct.

Defendant suggested that the court appoint an accountant to determine whether his proposed asset division was fair, and, if so, that plaintiff should be required to pay the accountant's fees. Defendant also sought counsel fees, contending that the motion was necessary only because of plaintiff's recalcitrance and unreasonableness.

Plaintiff opposed the motion and filed a cross-motion seeking to require defendant to "purchase the investments the Plaintiff should have received 'in-kind' at his sole expense in order to make me whole." In her certification, plaintiff stated that the purpose of the in-kind division was to equalize capital losses and gains. She also contended that most of the investments had increased in value and by giving her money based upon an earlier value defendant was depriving her of her fair share. Plaintiff also sought counsel fees against defendant "for violating the terms of our agreement."

The motions were heard on February 20, 2004. After hearing oral argument, the judge ordered that William Morrison, a CPA, would be appointed to review defendant's proposal "to determine whether that accomplishes a fair, reasonable and just division considering capital gains, capital losses, basis, tax consequences, so that they each come out on a 50/50 basis." The judge further stated that if defendant's position was vindicated, plaintiff would be obligated to pay Morrison's fees.

After further colloquy and arguments, the division of these assets and Morrison's role were revisited. The judge acknowledged that he had not fully understood the underlying issue and now realized that plaintiff was actually insisting upon strict compliance with the terms of paragraph 17, namely an in-kind distribution. The judge repeatedly questioned defendant's attorney as to why plaintiff should not have been able to receive an in-kind distribution and questioned how defendant could unilaterally change the agreement. Defendant's attorney and defendant continued to insist that it was not that simple and that defendant's proposal was fair and would accomplish the underlying purpose of paragraph 17.

The judge ordered that with respect to those stocks defendant had already liquidated, the proceeds of the liquidation would be divided equally between the parties, and Morrison would analyze the remaining stocks to determine whether they could be distributed in kind, and, upon receiving Morrison's report, the judge would make the ultimate determination of whether defendant's proposed method of distribution was fair and equitable. The judge said:

I think what I'm ruling is that he decided to liquidate certain stocks, certain investments. Now, he didn't have the right to do that. Now, he's got to justify it. If that liquidation was justifiable and resulted in a fair and equal distribution, taking into consideration the language of the agreement then she pays the fee.

Defendant's counsel asserted that it sounded like the judge had changed what he previously ordered, and the judge answered, "I did."

In accordance with that oral decision, the judge entered an order on that date, by which Morrison was appointed for two purposes, to prepare qualified domestic relation orders (QDROs) to divide retirement assets, and to analyze defendant's proposed distribution of the non-retirement assets. Morrison was required by the order to "take into account all relevant capital gains and/or losses, taxes, tax basis, dividends and interest." The order further provided that "[i]f defendant's proposed distribution is determined to be equitable and equal overall and in substantial compliance with the PSA than W[ife] shall pay Morrison[']s fees. If not than H[usband] shall pay Mr. Morrison[']s fees."

On June 14, 2004, Morrison issued his report. He stated his understanding that he had been retained to review the documents submitted to him "for the purpose of determining whether Defendant Guy Moffitt's proposed distribution of funds was equitable and equal overall and in substantial compliance with the [PSA]." He stated:

I conclude that it was. I have concluded that the impact of the proposed distribution functioned as a possible hypothetical economic detriment to Ms. Moffitt of approximately $3,700 attributable to capital losses that she did not receive the benefit of and subject to a discount for illiquidity of the Ryan Beck stocks.

Morrison's analysis had two basic components. First, he analyzed the share of capital losses of which plaintiff was deprived when defendant liquidated some of the stock. Without itemization, he reported that "[t]he cost basis of shares sold was $70,955.95" and "[t]he cost basis of shares retained was $70,832.11," so "the total [cost] basis for all shares was $141,788.06." He listed $98,070.48 as "[t]he fair market value for all shares" as of September 11, 2003.

Morrison then calculated the difference between the total cost basis and the fair market value for all shares, to yield the figure for the parties' total capital losses: $141,788.06 - $98,070.48 = $43,717.58. Equally dividing that figure, each party would be allocated 50% of the total capital losses, so plaintiff's share of the capital losses would have been $21,858.79. Assuming a 25% tax rate, Morrison calculated the after-tax value of plaintiff's share of the capital losses was $5,464.70 ($21,858.79 x .25 = $5,464.70). Morrison further explained:

The amount of $5,464.70 above, which is a hypothetical economic detriment to Ms. Moffitt, would not have been recognized by her immediately because capital losses may only be used to offset ordinary income in the amount of $3,000.00 per year, if there are no other capital gains. Thus, the $21,858.79 of capital losses shown above, would have been used over a period of eight years, in the amount of $3,000.00 per year, which equates to a tax benefit of $750.00 per year for seven years, and $214.69 in the eighth year ($5,464.70 in total). For purpose of calculating the present value of the $5,464.70, I assumed an interest rate of 5%. The present value equals $4,485.10, which is the economic detriment suffered by Ms. Moffitt attributable to the potential capital losses. If Ms. Moffitt offset the losses against capital gains, the benefit would have been lower. If Ms. Moffitt's tax rate was lower, the lost benefit would likewise have been lower. If her tax rate was higher, the last [sic] would have been higher.

For the second component of Morrison's analysis, he calculated a "discount for illiquidity" figure regarding the Ryan Beck stocks:

The fair market value of the Ryan Beck stocks was $16,047.00 on September 11, 2003. Ms. Moffitt's share was $8,023.50. I understand however that stocks held in the Ryan Beck account were illiquid. In accordance, I estimate that a discount for illiquidity of 10% is appropriate. Thus, Ms. Moffitt's share should be discounted by $802.35 (10% of $8023.50).

Combining these two components, Morrison concluded that plaintiff "incurred an economic detriment of $3,682.75," representing the $4,485.10 present value of share of capital losses minus the $802.35 discount for illiquidity of Ryan Beck stock.

Morrison further explained his conclusion: "These hypothetical damages equal 7.3% of the amount due. Accordingly, I conclude that Mr. Moffitt's proposed distribution was equitable and equal overall and in substantial compliance with the [PSA]." Morrison further explained that his bill for this matter was $10,710.37, due to the "sheer volume and condition" of the records involved, including information that was "handwritten and disorganized." He noted that he had "expressed to Counsel on multiple occasions, due to the amount of money in dispute, applying a cost/benefit analysis, this project was not an efficient use of the party's [sic] finances."

In January 2005, defendant filed a motion to compel plaintiff to pay Morrison's fees because Morrison's report vindicated defendant's position on the distribution. Plaintiff objected to Morrison's report. She contended it was not based on sound accounting principles, was incomplete because it was not accompanied by spreadsheets and other supporting data, and it did not cover all of the issues referred to Morrison by the court. She opposed the judge's prior order that she should be required to pay Morrison's fees, which she characterized as "exorbitant and incorrect." Plaintiff cross-moved for an order that would require defendant to pay Morrison's fees. Plaintiff enclosed a letter from an accountant she retained, questioning some aspects of Morrison's report. Indeed, plaintiff filed a grievance against Morrison with the New Jersey Board of Accountancy.

The court heard the motions on February 18, 2005. The judge concluded that Morrison's report was sound, that plaintiff did not demonstrate any actual loss to her by defendant's proposed distribution, and that the hypothetical loss set forth in Morrison's report was relatively insignificant. As a result, the judge concluded that Morrison's report was reasonable. He approved it and adopted it, finding "that the distribution made by Mr. Moffit was equitable, fair overall and in substantial compliance with the PSA." As a result, based upon his prior order, he directed plaintiff to pay all of Morrison's fees. Morrison deducted $500 from the bill previously submitted, to account for work that was performed on preparing the QDROs, and not properly included in the bill for analysis of distribution of the non-retirement assets. Therefore, plaintiff was ordered to pay $10,210.57. The judge denied plaintiff's motion to compel defendant to pay Morrison's fees.

On June 17, 2005, the court issued a written decision requiring plaintiff to pay defendant's counsel fee of $2700. The judge entered an order for that fee award on August 24, 2005. On October 7, 2005, plaintiff filed a notice of appeal from the February 18, 2005 and August 24, 2005 orders.

In December 2005, Morrison moved for an order to adjudge plaintiff in violation of litigant's rights for failure to pay his fees. He also sought imposition of a 1.5% monthly interest finance charge. Plaintiff filed a cross-motion for various forms of relief, including a stay pending appeal. She repeated her contention that she should not be required to pay Morrison's fees, stating that defendant's "disregard for complying with the PSA went unpunished, however the court chose to punish me by assessing counsel fees, Morrison's fees and I have the burden of my own legal fees." She also argued that the judge should recuse himself and not decide the motion, contending that the judge had demonstrated bias against her throughout the proceedings.

The motions were heard on February 10, 2006. Plaintiff appeared pro se. The judge had not been furnished with a copy of plaintiff's notice of appeal and proceeded to dispose of the matter. He ordered plaintiff to pay $10,210 to Morrison, with interest payable at rates provided in the Rules of Court. The judge declined to recuse himself, and set forth the reasons on the record. He entered an order on that date, entering judgment in Morrison's favor. On April 19, 2006, plaintiff filed an amended notice of appeal to incorporate the issues in the February 10, 2006 order.

Plaintiff contends that the trial court erred in referring the non-retirement funds distribution issue to Morrison for analysis, and for accepting Morrison's flawed report and recommendations.

"The findings of a trial judge are entitled to great deference and will be overturned only if 'we are convinced that they are so manifestly unsupported by or inconsistent with the competent, relevant and reasonably credible evidence as to offend the interests of justice.'" Platt v. Platt, 384 N.J. Super. 418, 425 (App. Div. 2006) (quoting Rova Farms Resort, Inc. v. Investors Ins. Co. of Am., 65 N.J. 474, 484 (1974)).

From our review of the entire record of these proceedings, we are satisfied that the record supports the judge's conclusion that division of these assets strictly in-kind was not feasible, that liquidation and division of the proceeds was fair and equitable, and that this distribution was functionally equivalent to and therefore in substantial compliance with paragraph 17 of the PSA. The judge did not mistakenly exercise his discretion in appointing an independent expert to analyze the consequences of defendant's proposed method of distribution. The contentions of the parties made clear that, in addition to merely determining fair market value and dividing that amount in half, there were potential tax consequences that might be significant and might skew the results if one side or the other retained some of the stocks in-kind. We also find no error in the judge's acceptance of the Morrison report in furnishing a basis for the conclusion that defendant's distribution constituted substantial compliance with the PSA. We therefore affirm the order approving that distribution.

However, we do not agree that plaintiff should have borne the entire burden of Morrison's fee. It was defendant who took it upon himself to begin liquidating the assets before reaching agreement with plaintiff to do so or seeking court permission. Thus, the burden should have been on defendant to establish that his proposed method substantially complied with the terms of the PSA. Nevertheless, plaintiff's position and conduct on this issue was not completely reasonable and contributed to the need for these proceedings. In our view, both parties contributed to the need for judicial resolution of this issue, and both should share equally in paying the fees of the court appointed accountant, whose services were necessary to enable the court to resolve the dispute.

For similar reasons, we conclude that the judge mistakenly exercised his discretion in requiring plaintiff to pay defendant's counsel's fees. Defendant's conduct was equally responsible for precipitating the dispute. Both sides should pay their own counsel fees under these circumstances.

Accordingly, we modify the orders under review to require each party to pay 50% of Morrison's fees and to vacate the order requiring plaintiff to pay $2700 in counsel fees incurred by defendant.

Plaintiff's final argument under this appeal is that the judge erred in denying her motion to recuse himself and that we should now order him recused from any further proceedings that may arise between these parties. In addition to her general claim of unfairness and bias, plaintiff points out that the judge corresponded with the Board of Accountancy with respect to her grievance against Morrison. However, the judge's letter, in response to a request, merely enclosed copies of orders entered, which the judge described as "self-explanatory." The judge took no position regarding the substance of the grievance proceeding.

At the February 10, 2006 hearing, the judge, after reciting the standards for recusal, stated that

after reviewing everything and after a thorough . . . introspective insight into my own mind, I can clearly state that I bear no ill will to either of the parties in this case, there is no bias, there is no prejudice. I have and will continue to act in good conscience and mature judgment to the best of my ability in hearing this case and in coming to a conclusion. I have decided . . . the motions that I have heard on the law, on the certifications. I have not been motivated by bias or prejudice against either party. So, for that reason, I see no reason to be recused.

A recusal decision "rests in the sound discretion of the trial judge. The trial judge is in as good a position as any to evaluate a claim that an action has the appearance of impropriety." Jadlowski v. Owens-Corning Fiberglas Corp., 283 N.J. Super. 199, 221 (App. Div. 1995) (citations omitted), certif. denied, 143 N.J. 326 (1996). "Indeed, it is improper to grant a recusal motion unless the alleged ground is true." Ibid. We have no reason to doubt the judge's sincerity or truthfulness on the recusal motion. His denial of the motion was not a mistaken exercise of discretion. We affirm on this issue.

In A-2949-05T3, plaintiff appeals from six orders, which, for purposes of convenience, we characterize as three pairs of orders: (1) The December 15, 2005 order, entered after a plenary hearing, granted defendant's motion to reduce his alimony and support obligations, and awarded him counsel fees; by order of January 20, 2006, plaintiff's reconsideration motion was denied. (2) By order September 8, 2006, the court granted plaintiff's request to require defendant to provide proof of life insurance, but denied her various other requests pertaining to the PSA; on November 3, 2006, the court entered an order denying plaintiff's motion for reconsideration. (3) After a plenary hearing, the court entered an order on January 29, 2007 modifying the PSA to reduce defendant's obligations for tutoring expenses for the children; the March 30, 2007 order denied plaintiff's motion for reconsideration.

The PSA obligated defendant to pay annual child support of $31,200 ($600 per week), and $85,000 per year in permanent alimony. Paragraph 13 of the judgment further provided that

defendant would have a right to modify his alimony obligation as set forth herein in the event his employment drastically changes and his income is less than $321,000.00 per year. If that occurred, he would have the right to make application to the Court to review his alimony obligation. The defendant having agreed to said obligation premised on his making at least that amount of money per year. It shall be the obligation of the defendant, if he does make an application, to prove to the Court that his income does not reach that level; . . . .

Defendant held a bachelor's degree and worked for nearly twenty years until February 2003 for Aon Corporation and its predecessors, specializing in legal malpractice insurance. When the parties separated in December 2001, defendant moved into the Hasbrook Heights home of the woman who would become his wife after the divorce, Candee Jean Moffitt (Candee). In August 2003, defendant and Candee jointly purchased a home in Monroe, New York for $1.3 million. During 2003, defendant borrowed about $125,000 from Candee, which she raised by securing a $125,000 mortgage on her Hasbrook Heights house. Defendant applied a large portion of this amount to the down payment on the New York house and to pay his legal fees in the divorce litigation. In September or October 2004, defendant "paid her [Candee] back" for these advances by transferring title to her of a T.D. Waterhouse stock brokerage account which defendant had created after the divorce. The value of the account was approximately $179,000.

After leaving Aon Corporation, defendant was employed by Marsh & McClennan (Marsh), where he was engaged in the same line of business. However, he was fired on May 12, 2004. He received a $250,000 severance settlement, which resulted in a net amount after taxes of just over $150,000. Defendant's gross income for 2004 was about $715,000, and in 2003 it had been about $628,000.

After leaving Marsh, defendant experienced a significant period of unemployment. During this time, he was paying alimony and child support and providing for his own living expenses out of unemployment benefits and dissipating assets. Because Marsh had terminated about ten percent of its workforce, about 5000 employees, and Aon had also let several thousand workers go, employment in defendant's field was extremely difficult to find. He contacted two headhunters and made 150 to 200 calls, responded to fifty newspaper ads, and could obtain only two interview opportunities in 2004. By the end of 2004, defendant's attorney began efforts at negotiations with plaintiff's attorney regarding a reduction in alimony and child support obligations. These efforts were unsuccessful, and on January 21, 2005, defendant filed a motion for reduction.

During this time, defendant cut back his living expenses. He and Candee shared one vehicle. Defendant stopped paying his alimony in late December 2004, but he continued paying child support.

While the motion was pending, defendant received an employment offer in early March 2005 from Wachovia Insurance (Wachovia). This was the first offer he received, and he accepted the position. He would receive a $100,000 annual draw against commissions. Defendant was hopeful that with his extensive experience and contacts in the legal malpractice insurance field, he would ultimately earn more than $100,000 from this employment, but that was dependent upon commissions to be earned. He was hopeful that he could ultimately return to his earlier earning levels, which had averaged about $321,000 per year that formed the basis of the PSA alimony provision. Defendant and Candee were also receiving some modest rental income from a cottage on their New York property.

In March and April 2005, after a court appearance, the judge encouraged the parties to decide how to divide the roughly $50,000 remaining in non-retirement assets. If the parties could not agree, the judge authorized defendant to divide them as he saw fit, pending a plenary hearing to be held with respect to defendant's motion to reduce alimony and child support. Defendant sought to divide the value of the remaining stocks equally, which would have yielded about $28,000 for each party. However, plaintiff continued to dispute Morrison's analysis and continued to persist in seeking an in-kind distribution.

A dispute also arose regarding division of New York tax refunds for prior years, as covered in the PSA. Plaintiff contended that defendant should be solely responsible for any interest and penalties due to late filing. Defendant sought to distribute the net amount equally between the parties.

The court conducted a plenary hearing on October 19, 20, 25, 26, and November 16, 2005. However, before doing so, upon the filing of defendant's motion, the judge entered pendente lite orders. On March 17, 2005, the court entered an order temporarily reducing defendant's support obligations and setting discovery and case management dates for the anticipated plenary hearing. That hearing would deal with proposed modification of alimony and child support, modification or enforcement of the PSA, resolution of all outstanding equitable distribution issues, and counsel fees. The order also stayed "enforcement proceedings on support" pending the plenary hearing. On June 2, 2005, the court entered an order clarifying that the stay referred to "alimony arrears that may be owed by the defendant to plaintiff" and that the Probation Department should cancel any such arrears of record and reduce them to zero pending the hearing, at which time the court would fix the amount of any arrears and have them re-entered on the Probation Department records.

On the first day of the plenary hearing, counsel advised the court that some issues had been resolved, and the court directed counsel to present these by consent order to be signed the next day. One of the proposed orders dealt with the distribution of non-retirement assets. However, when the parties returned to court on October 20, 2005, plaintiff refused to sign the consent order. The judge stated that the matter was reported settled the previous day and that all terms of the settlement were placed upon the record. He therefore deemed it a closed matter.

Plaintiff's position at the plenary hearing was that defendant's application was premature because his unemployment, followed by reduced earnings, was only temporary. She urged the court to average defendant's income, and taking into consideration his extraordinarily high income in 2003 and 2004, his average income for 2003, 2004 and 2005 had not actually fallen below the $321,000 threshold for reduction.

Plaintiff had bought out defendant's interest in the marital home. She had a $777,000 mortgage, which she refinanced to interest-only status. She testified that she had credit card debt including $16,000 incurred jointly prior to the divorce, she owed nearly $147,000 on a promissory note to her aunt, and she would be unable to meet her living expenses if the alimony and child support were reduced.

Plaintiff holds a bachelor's degree and had worked for ten years as a salesperson and then an assistant buyer for B. Altman & Company. However, she stopped working in 1989, taking a disability leave due to neck problems. She testified regarding her physical disability and produced medical evidence that she might need surgery on both shoulders. In a de bene esse deposition, a neurologist, Dr. David Adams, testified that he "could envision her condition improving or even getting to the point of being cured, but it would require . . . surgery." He was not asked further questions on the subject and did not elaborate further. Plaintiff testified that she had no plans to schedule surgery because her understanding of the recommended procedure was that it was risky.

Plaintiff acknowledged that her employability expert in the divorce proceeding did not state that she had employment limitations due to health issues. The report noted that plaintiff stated she and defendant agreed that she would remain the homemaker because he earned a substantial living and their son had learning disabilities that required a great deal of her time. Defendant denied knowledge of plaintiff having any significant health problems. He was aware of her neck problems, but did not believe that was a debilitating condition.

The parties' son suffers from pervasive developmental disorder (PDD), as well as hyperactivity and some attention deficient disabilities, expressive language disabilities, and writing expression disabilities. PDD is within the autism spectrum, but it is not as severe as individuals diagnosed with autism.

The divorce judgment included a provision that Dr. Jane Healey would provide ongoing evaluations and analysis of the son's educational needs. For a time, the son attended private schools and, while money was plentiful, substantial tutoring services, as recommended by Dr. Healey, were provided. Eventually, the son was mainstreamed in public school, although still receiving tutoring and some special assistance within the school system. At the time of the plenary hearing, the son was doing very well as an eighth grade student. He was active in sports and other activities. Since March 2005, defendant had stopped paying most of the tutoring expenses, and was paying only $160 for two of the eight monthly language therapy sessions provided. Plaintiff was paying the balance.

Although the daughter had no learning disabilities, she was provided some tutoring for subjects in which she had difficulty. She ultimately successfully graduated high school and is attending Fordham University.

Plaintiff did not want to move out of the marital home, although it is much larger than she needs (4576 square feet, five bedrooms, three-and-one-half bathrooms, three-car garage, on nearly one acre of land, with a market value of $1 million), and its carrying costs are substantially higher than she would be able to afford with a substantial reduction in alimony and child support. To maintain her current standard of living, she would have to go even deeper into debt on an ongoing basis. Defendant contended that plaintiff could move to a smaller and less expensive home, and their son could continue in the same high school without disruption.

When the plenary hearing was concluded, the court issued a written decision on December 15, 2005, with an accompanying order granting defendant's request to reduce alimony and child support. Alimony was reduced to $25,000, payable $481 weekly through Probation, based upon $100,000 in annual income for defendant and no imputed income to plaintiff. The reduction was effective as of the filing date of the motion, stated as January 14, 2005. The court indicated that Probation was to calculate any arrearages, which would be satisfied in $50 weekly payments. Child support was reduced to $311 weekly, calculated pursuant to the Child Support Guidelines. The court terminated defendant's obligation to pay continued tutoring expenses for the son effective January 14, 2005.

Finally, the court ordered plaintiff to pay $20,000 toward defendant's counsel fees. The court found that defendant made bona fide and reasonable efforts to settle the issues and found that he was "straightforward, honest, candid and truthful," while plaintiff was "bent upon economic destruction" of defendant, attempted to re-litigate issues previously decided by the court, and gave answers in cross-examination that were "frequently vague, evasive and non-responsive."

Plaintiff's reconsideration motion was denied, and the court granted defendant's cross-motion for $1800 in counsel fees. Plaintiff appealed from these orders.

Meanwhile, an appeal was pending in this court regarding the disposition of previously litigated matters in this case under Docket No. A-6204-03T2. On May 23, 2006, we remanded for a plenary hearing regarding tutoring and special education requirements for the parties' son and math tutoring for their daughter, as well as defendant's obligation to pay medical expenses for the son. In the appeal now before us, A-2949-05T3, apparently in recognition of the remand on those issues from the prior appeal, we entered an order on July 25, 2006 temporarily remanding this matter to the trial court for a period of ninety days.

In July 2006, following our remand orders, plaintiff filed a pro se motion seeking to enforce various terms of the divorce judgment and numerous other orders. Before argument, plaintiff withdrew some requests because she wanted to have an attorney represent her on those issues in a later motion. The remaining issues, on which the court heard argument on September 8, 2006, were plaintiff's requests to compel (1) equal distribution of one-half of the 2001 and 2002 tax refunds, (2) proof of required life insurance, (3) equal distribution of one-half of the Aon supplemental plan assets, and (4) distribution of one-half of the non-retirement assets. The court found that defendant was required to provide proof of life insurance, and granted that item of relief to plaintiff. The judge denied items (1) and (4), finding that defendant met his obligations in dividing the assets. As to item (3), the court held that the disputed sum was a pre-divorce judgment payment that the parties did not separately address in the divorce judgment, as a result of which it was controlled by the provision in the judgment that "all other issues pleaded and not resolved herein are deemed abandoned." An order was entered to that effect on September 8, 2006. Plaintiff's reconsideration motion was denied. On December 14, 2006, plaintiff filed an amended notice of appeal to include those orders.

The plenary hearing on our remand orders was conducted on January 23, 24, 25, and 29, 2007. Both parties appeared pro se. The only issues arising out of that hearing that remain relevant on appeal pertain to the son's educational requirements and the tutoring expenses for both children.

Plaintiff testified that defendant had paid some of the tutoring expenses for a time, but in the summer of 2005, she ended up paying all of the bills for the son's tutor, Amanda Treadwell. Without any contribution from defendant, she paid the following amounts: $350 in 2005 and $925 in 2006 to Treadwell; $4000 in 2005 and $2805 in 2006 to Sandra Segala; $800 in 2004 to Christine Salerni; $200 in 2006 to Christine White; and $200 in 2006 to William Sharma. As to Segala, the son's language tutor, defendant offered to pay for only two sessions per month, although Segala had been tutoring their son for two sessions per week since 2001. Segala's rate was $85 per session. Thus, it would cost $6300 per year to continue the two sessions per week schedule. Plaintiff also sought to continue the services of Sharma for math and science and White for other academic subjects and the social skills class, at an annual cost of $14,050.

Dr. Healey testified that she first saw and evaluated the son in February 2003. Her diagnosis was as we have previously described. She had recommended numerous services, both in and out of school. She felt that continuation of these services was very important pursuant to the provision in the divorce judgment appointing Dr. Healey. She wrote to the court on April 14, 2004, noting that her recommendations for occupational therapy and social skills therapy for the son had not yet been followed and that her summer tutoring recommendation was no longer being followed. She characterized the summer tutor, Christine Carey, as the son's "lifeline," noting that he had studied with her since age three.

Dr. Healey saw the son for an updated evaluation in December 2005, particularly because he was preparing to enter high school the next year. Her diagnosis remained much the same, except that she no longer saw evidence of an attention deficient hyper activity disorder, and she added "developmental reading disorder" and "developmental math disorder."

Dr. Healey recognized that although many therapies would be helpful, she realized they were very costly. It was her practice to work with a family to help a child get needed services within their economic means. Thus, she acknowledged the need to prioritize and, in this case, she felt it most important to continue the language therapy because that was "a very special type of help that can't be given anywhere else." She recommended weaning the son from his more extensive tutoring services, keeping some in place, like the language and homework help, and slowly over time removing more of the services.

Dr. Healey confirmed that the son was a classified student, learning in the regular classroom with all of the other eighth grade students, but with the additional special education teacher there to assist him in math, science, and English. She also acknowledged that his grades were good, with As and Bs and positive comments from his teachers. She also agreed that it would be difficult to fit in all of the recommended tutoring with his extensive sports schedule, of which she had not been fully aware.

With respect to the daughter, plaintiff had arranged some tutoring for her during high school. Defendant claimed he was not aware of that and had not consented to any tutoring expenses for her, which he deemed unnecessary. Between 2004 and 2006, plaintiff had paid more than $8000 in tutoring expenses for the daughter. By the time of the hearing, the daughter was a freshman at Fordham University. Therefore, there was no issue about future expenses, but plaintiff sought reimbursement for half of the amounts she had paid. The parties disputed whether the tutoring had been recommended by the daughter's school counselors.

Defendant testified that his income between May 2005 and January 2007 "has been roughly . . . $165,000." He said his earned income from his employer in 2005 was $62,302. He also acknowledged earning $6000 in net rental income. With interest, dividends, a one-time consulting fee, and unemployment income, his total income for the year 2005, after "taking off the subtractions," was $83,490.72. Candee was not employed, but she earned rental income from her Hasbrouck Heights home. Charging defendant with half of that income, the judge calculated defendant's gross income for 2005 to be about $92,000.

Since the 2005 hearing, defendant had incurred new debt of about $90,000 to Candee, because she sold stocks of about that amount "to enable us to remain in our house." Defendant also reported that Candee's thirty-year-old son had lived in Candee's house, and that in December 2006, he had loaned $20,000 to defendant and Candee to help cover their living expenses.

On January 29, 2007, the court rendered an oral decision regarding the issues in the plenary hearing. The court found that the tutoring costs had increased to the point at which they must be considered "an extraordinary expense." If Dr. Healey's recommendations were to be fully implemented, the cost would be about $14,000 to $15,000 annually for the son, and the daughter's tutoring expenses totaled about $8000 before she went to college. Relying upon and incorporating the findings from the December 15, 2005 decision, the court noted that defendant's income had drastically decreased, amounting to a substantial change of circumstances requiring modification of alimony and child support. The court restated its view as expressed in the earlier decision that income averaging was not appropriate. It found that defendant's income for 2006 was $101,515, very close to the figure anticipated in the December 2005 ruling.

The court imputed $35,000 a year to plaintiff, asserting that this was the figure in the divorce judgment that had never been modified, even though for purposes of the December 2005 ruling the court assumed that plaintiff had $0 in income, aside from alimony and child support.

The court made findings that in 2005 and 2006 defendant had income of $76,866 and $101,515, respectively, defendant paid $3800 in tutoring expenses in 2005, including $2400 to Segala and $1400 to Treadwell.

The court also found that both parties were "borrowing substantially to maintain their current expenses." According to their respective case information statements, plaintiff had borrowed $252,000 from her aunt, and $11,000 from another individual, had a $777,000 mortgage, and owed about $45,000 in credit card debt. Defendant had borrowed $120,000 from Candee and $20,000 from Candee's son. Additionally, defendant owed his attorney $27,500 and had a $933,000 mortgage and $18,000 in credit card debt.

The court concluded that neither party could afford to pay $14,000 to $15,000 a year for the son's tutoring. In the court's view, Dr. Healey "substantially retreated from her recommendations and her written report when she testified on cross-examination. She indicated that if she understood the economic situation of this family, the plaintiff and defendant's income and expenses, and if she were aware of [the son's] avid interest in sports and sports activities, she acknowledged that these outside activities have to be prioritized." The court found that Dr. Healey's consultation played a pivotal role in convincing school officials to provide extensive in-school services for the son. Dr. Healey's recommended out-of-school tutoring was beyond the means of the parties to pay, and in light of Dr. Healey's acknowledgment that there must be prioritization, the court found that "common sense dictates that . . . out of school tutoring services must be reduced." The court added that "[b]oth parties have to face reality" on this issue.

The court found defendant's position on this subject "fair and reasonable," namely that he would pay $170 a month for two tutoring sessions with Segala. This would provide continuation of Segala's recommended tutoring with the son. The court emphasized that this was not necessarily a permanent arrangement, and could be modified if circumstances changed.

As to the daughter, the court found that plaintiff incurred tutoring expenses unilaterally, without any recommendation from the school. Although the court commended plaintiff for doing all she could to help her daughter excel in school, the court found no basis to impose one-half the burden on defendant under the circumstances. Considering that the services were rendered and they did benefit the daughter, but also considering that defendant did not authorize them, the court required defendant to reimburse plaintiff for $2000 of the expenses.

The court modified the divorce judgment regarding the son's tutoring, finding that defendant owed $400 for summer tutoring for 2004 and had no further obligation for 2005 beyond the $3800 he had already paid. Based on defendant's current financial ability, for 2006 and annually thereafter, defendant was ordered to pay $2040 ($170 monthly) to Segala, and he owed a balance of $480 to plaintiff for payments she made to Segala in 2006.

Plaintiff moved for reconsideration. On March 30, 2007, the court denied the motion. On April 23, 2007, plaintiff further amended her notice of appeal, seeking relief from the January 29 and March 30, 2007 orders.

Plaintiff argues that in the December 15, 2005 order, the court erred by decreasing defendant's support obligations and eliminating arrears. She presents several arguments. First, she asserts that defendant's motion was premature because his unemployment and reduced earnings were temporary. Further, she argues that in light of his extremely high earnings in 2003 and 2004, even if he had no income in 2005, his three-year average for 2003, 2004, and 2005 would have exceeded the $321,000 modification threshold in the PSA. Plaintiff further argues that the PSA only authorized defendant to apply for a decrease in alimony, but not child support, if his income dipped below $321,000. She further argues that the court should have imputed annual income to defendant of at least $321,000. Finally, she argues that the court should have considered defendant's transfer of about $180,000 to Candee and his substantial real estate assets as available sources for continued payment of the higher amounts.

We begin by noting that all support arrangements, including alimony and child support, are subject to change in the event of a permanent substantial change in circumstances. Deegan v. Deegan, 254 N.J. Super. 350, 354 (App. Div. 1992) (citing Lepis v. Lepis, 83 N.J. 139, 145 (1980)). Further, our scope of appellate review is limited. Trial courts are granted broad discretion. Innes v. Innes, 117 N.J. 496, 504 (1990). All reduction applications are fact sensitive, and reviewing courts "'must give due recognition to the wide discretion which our law rightly affords to the trial judges who deal with these matters.'" Rolnick v. Rolnick, 262 N.J. Super. 343, 359-60 (App. Div. 1993) (quoting Martindell v. Martindell, 21 N.J. 341, 355 (1956)). In Rolnick, we explained:

To vacate a trial court's findings in a proceeding modifying alimony, an appellate court must conclude that the trial court clearly abused its discretion, Avery v. Avery, 209 N.J. Super. 155, 163, 507 A.2d 242 (App. Div. 1986); Gugliotta [v. Gugliotta], supra, 164 N.J. Super. [139] at 141, 395 A.2d 901 [(App. Div. 1978)], failed to consider "all of the controlling legal principles," Avery, supra, 209 N.J. Super. at 163, 507 A.2d 242, or it must otherwise be "well satisfied that the finding[s] [were] mistaken," Dale v. Dale, 13 N.J. Super. 59, 62, 80 A.2d 234 (App. Div. 1951), or that the determination could not "reasonably have been reached on sufficient credible evidence present in the record after consideration of the proofs as a whole." Gugliotta, supra, 164 N.J. Super. at 141, 395 A.2d 901.

[Rolnick, supra, 262 N.J. Super. at 360.]

Moreover, a reviewing court must give "substantial weight" to the trial judge's "observations of the parties' 'demeanor, comprehension and speech' when they appeared before the court," ibid. (quoting Barrie v. Barrie, 154 N.J. Super. 301, 307 (App. Div. 1977), certif. denied, 75 N.J. 601 (1978)), recognizing that "'[t]he trial judge ha[s] the distinct advantage of observing the demeanor of the witnesses and a better opportunity to judge of their credibility than a reviewing court.'" Ibid. (quoting Friedman v. Friedman, 37 N.J. Super. 52, 57 (App. Div.), certif. denied, 20 N.J. 135 (1955)).

Applying these principles, we find no basis to interfere with the findings and conclusions of the trial court regarding modification of alimony and child support and of the tutoring expense obligations. The court's finding that defendant was not voluntarily unemployed or underemployed and that he diligently sought new suitable employment are well supported by the record. Defendant was terminated by Marsh. The judge found that, considering all of the stautory alimony factors, defendant established a substantial bona fide change in economic circumstances warranting reduction in alimony and child support. He went through an extended period of unemployment, during which he made extensive efforts to search for new employment. During that time, he experienced a substantial depletion of assets and went deeper into debt in order to keep up his substantial alimony and child support payments for many months before filing a motion for reduction.

Defendant's new employment carried with it no guarantee of annual income exceeding $100,000. Defendant candidly acknowledged that he hoped to earn more. However, by the time of the plenary hearing and the court's order, he had not done so. There was no basis for the court to impute a higher amount of income to defendant. And, because this was not a situation where significant fluctuations in income could be expected, this was not a case that was appropriate for income averaging. Child Support Guidelines, Pressler, Current N.J. Court Rules, Appendix IX-B, Page 2341 (2009) ("If income from any source is sporadic or fluctuates from year-to-year (e.g. seasonal work, dividends, bonuses, royalties, commissions), the amount of sporadic income to be included as gross income shall be determined by averaging the amount of income over the previous 36 months or from the first occurrence of its receipt whichever time is less.")

Regarding the actual needs and the parties' ability to pay, the court found that plaintiff made no efforts to seek employment, nor had she explored the possibility of surgery to correct her disability. The court concluded that she exaggerated her current needs and made no efforts to reduce her lifestyle, despite defendant's loss of employment and drastic reduction in income. In contrast, the court found that defendant had made reasonable efforts to earn income at his prior level and also made "reasonable efforts to cut back on his expenses."

In light of the judge's findings, all of which are amply supported by the record evidence, the levels of alimony and child support set by the court were reasonable. We have no occasion to interfere.

With respect to the alimony and child support, however, plaintiff further argues that the court erred in eliminating all support arrears that accumulated pending the court's decision on the October 2005 plenary hearing. She asserts that in view of the June 2, 2005 order temporarily eliminating arrears to avoid enforcement proceedings pending the hearing, the court failed to reinstate the arrears in its order so that the Probation Department could correctly implement the court's direction.

The court's written decision and accompanying orders left some room for confusion regarding arrears. In its decision of December 15, 2005, the court stated that alimony would be reduced to $25,000 per year, payable at the rate of $481 per week "effective the date of filing of husband's notice of motion, January 14, 2005" and that "Probation shall calculate the arrearages, if any, which shall be payable at the rate of $50 per week." The order of that date stated the same effective date, January 14, 2005, with respect to both alimony and child support. With respect to alimony, the Probation Department was directed to calculate arrearages and credits in accordance with the court's written decision.

The issue here pertains to the correct effective date of the reductions. Child support obligations cannot be retroactively modified, except for the period during which a modification application is pending, "but only from the date the notice of motion was mailed either directly or through the appropriate agent." N.J.S.A. 2A:17-56.23a. The statute further provides that "modification shall be permitted only from the date the motion is filed with the court." Ibid. The documents in the appendix do not indicate a "filed" or mailing date, but the cover letter for filing and the document's preparation dates all indicated January 21, 2005. Accordingly, that is the date that the court must use for modification of the support amounts.

We modify the court's order to designate January 21, 2005 as the effective date of the alimony and child support reductions. Arrears should be recalculated using that date by the Probation Department. Of course, for any periods prior to that date, arrearages would be calculated at the higher amounts. Correspondingly, any overpayments in child support under the pendente lite order would provide credits to defendant. If either party disagrees with the recalculation by the Probation Department, an application can be made to the trial court, which has the ultimate authority to determine the amount of arrearages and the terms on which they will be paid.

With respect to plaintiff's contention that defendant had more assets available to him for payment of alimony and child support and should be "charged" in the analysis with repayment of the loan to Candee, we defer to the trial judge's credibility assessment and determination that the payment was reasonable under all of the circumstances and did not constitute a wrongful depletion of defendant's assets.

We next consider plaintiff's argument that the court erred in several equitable distribution rulings, namely, those dealing with the non-retirements assets, the supplemental plan assets from defendant's former employer, Aon, and the 2001 and 2002 New York tax refunds.

With respect to the non-retirement assets, the record establishes that plaintiff's counsel asserted on her behalf on the record in court and in her presence that she was willing to settle the non-retirement asset issue consistent with the terms of the proposed consent order. We find no error in the court's refusal to allow plaintiff to renege on that settlement by refusing to sign the consent order. An order consented to by the parties' counsel is not appealable. Winberry v. Salisbury, 5 N.J. 240, 255, cert. denied, 340 U.S. 877, 71 S. Ct. 123, 95 L. Ed. 638 (1950).

Defendant received a deferred compensation payment from Aon when he left his employment there and went to work for Marsh. The parties exchanged correspondence regarding distribution to plaintiff of her share of these funds in 2003. Plaintiff cashed the March 11, 2004 check to her for $8512.66, with the notation "Under Protest." She now claimed she was not paid the correct amount.

The judge stated that the issue was not properly before him because it was not raised on a motion. The judge further stated that the issue was belatedly raised in 2005 for funds that were distributed in 2003. The judge deemed this claim by plaintiff to have been waived pursuant to a provision in the divorce judgment that "all other issues pleaded and not resolved herein are deemed abandoned." Accordingly, in its September 8, 2006 order, the court stated that defendant was paid the Aon funds "during divorce litigation."

We agree with the trial court's ultimate decision on this issue. Even if plaintiff was not in a position to raise this issue in the divorce case prior to entry of the divorce judgment, she surely could have raised it as part of the issues that Morrison was reviewing or in the discussion of retirement and non-retirement issues that were settled at the beginning of the October 2005 plenary hearing. We agree with the judge's conclusion that plaintiff sat on her rights on this issue too long, and we will not interfere with the trial court's determination of the issue.

With respect to the tax refunds, paragraph 19 of the divorce judgment provided "that the parties have agreed that any refunds associated with the filing of the 2001 and 2002 returns that relate to New York State, will be divided equally by the parties after the payment of any other tax is due." The record reflects that payments were made for those tax years to the Internal Revenue Service and the New York and New Jersey tax departments for the total amount of $11,474, and that a tax preparer was paid $150. The New York tax refund for those years was $16,514.13. Plaintiff claims entitlement to one-half of that amount. However, defendant sent her only $2370.07. Plaintiff therefore argued she was entitled to an additional $5887.

However, subtracting the $11,774 from the New York tax refund of $16,514.13, the net refund was $4740.13, one-half of which is the $2370.07 that defendant sent to plaintiff.

Therefore, we are satisfied that the record supports the court's conclusion that defendant paid plaintiff what he owed her from those 2001 and 2002 tax refunds.

Plaintiff argues that the trial court erred in its rulings regarding the children's tutoring expenses and the son's educational requirements. As we have described, these issues were addressed to some extent in the fall 2005 hearing on defendant's motion to modify support, and then also in the January 2007 plenary hearing on the remand orders from this court.

Following the remand hearing, the judge ordered that the divorce judgment should be modified due to the substantial change of circumstances regarding the parties' financial abilities to pay. Although children of high income families are entitled to the benefit of financial advantages available to them, the custodial parent bears the burden of establishing the reasonableness of those expenses. Accardi v. Accardi, 369 N.J. Super. 75, 88 (App. Div. 2004). We find no error in the trial court's finding that plaintiff failed to establish the reasonableness of continuing the extensive tutoring previously provided for the parties' son in view of the parties' greatly reduced income level.

As to the daughter's tutoring expenses, we find no mistaken exercise in discretion in the court's determination that defendant should reimburse plaintiff for only $2000 of the approximately $8000 in expenses that she unilaterally incurred in 2003, 2004 and 2005.

Finally, as to the son's educational requirements, plaintiff contends that because this issue was specially addressed in the divorce judgment, with the appointment of Dr. Healey, it was error for the court to modify this provision even under a showing of changed circumstances. Plaintiff cites no legal support for this suggestion. It is contrary to the Lepis principles, which allow courts to modify support agreements in view of substantial changed circumstances.

The court agreed that the son continued to need tutoring, but substantially scaled back the amount. This was because of the substantial reduction in income available for this purpose, and in light of Dr. Healey's testimony regarding the need to prioritize. The judge's handling of this issue was well supported by the testimony, and well within the court's discretion.

Plaintiff's contention that the trial court failed to properly enforce the divorce judgment's provision regarding defendant's proof of maintaining life insurance coverage lacks sufficient merit to warrant discussion in a written opinion. R. 2:11-3(e)(1)(E).

Finally, plaintiff contends that the court erred in entering the counsel fee awards against her.

Rule 5:3-5(c) sets forth the factors to be considered in making a fee award in a matrimonial action:

In determining the amount of the fee award, the court should consider, in addition to the information required to be submitted pursuant to R. 4:42-9, the following factors: (1) the financial circumstances of the parties; (2) the ability of the parties to pay their own fees or to contribute to the fees of the other party; (3) the reasonableness and good faith of the positions advanced by the parties; (4) the extent of the fees incurred by both parties; (5) any fees previously awarded; (6) the amount of fees previously paid to counsel by each party; (7) the results obtained; (8) the degree to which fees were incurred to enforce existing orders or to compel discovery; and (9) any other factor bearing on the fairness of an award.

Although plaintiff correctly points out that the respective earning power of the spouses strongly favors her in this analysis, we nevertheless conclude that the court acted well within its discretion. It made credibility findings, with support in the record, that defendant made efforts to settle the matter and avoid litigation while plaintiff turned to litigation repeatedly, even as to issues the court had already decided. Plaintiff's conduct increased the counsel fee expenses, which both parties could ill afford once defendant lost his job. In the end, the court agreed with defendant on the merits of the present support modification application. The court also apparently did not believe plaintiff's assertions that her unwillingness to settle litigation was tied to defendant's unwillingness to share critical documentation. We will not second-guess that credibility determination. All of these factors weigh in favor of affirming the counsel fee award. We note also that defendant's counsel's affidavit of services indicated a balance of over $53,000 as of the end of the 2005 hearing. Accordingly, we affirm the counsel fees awarded against plaintiff of $20,000 for the October 2005 plenary hearing and $1800 for the reconsideration motion.

III

We now consider plaintiff's third appeal, A-3178-06T3, in which she seeks relief from an order of December 1, 2006 dealing with equitable distribution of certain pension plan benefits, and an order of January 19, 2007 denying her reconsideration motion. Plaintiff argues that the court erred in applying a cut-off date for the division of the Aon pension plan, in declining to deduct the cost of the survivor annuity before dividing the benefits, in declining to compel defendant to provide certain information and execute authorizations regarding the pension plans, and in denying her a counsel fee award.

Regarding the pension assets at issue in this appeal, paragraph 17 of the divorce judgment provided:

On the first day of the October 2005 plenary hearing, which is the subject of the appeal in A-2949-05T3, discussed in Part II of this opinion, counsel placed on the record that the parties had agreed to terms, which became incorporated into the "Consent Order For Distribution of Retirement Assets" entered on October 20, 2005. That order stated:

1. The parties will equally divide all retirement accounts using the procedures set forth in this Order, within 30 days from the date of this Order.

2. Guy Moffitt will initiate the retention of William Troyan to prepare QDROs to equally divide his St. Paul pension and AON pension, and will provide to Mr. Troyan whatever documentation and information he requires. Laura Moffitt will cooperate with Mr. Moffitt and Mr. Troyan and both parties will execute whatever documentation is required by Mr. Troyan. The parties will equally share the cost for Mr. Troyan.

3. The parties will equally divide the aggregate value of the following retirement plans: Mr. Moffit's Davis Funds, ING fund, Ryan Beck retirement account, AON Corporation Savings Plan, and Mrs. Moffitt's Schwab IRA. For purposes of this Order, the value of each plan shall be the value including all contributions attributable to services performed on or prior to February 15, 2002, together with any changes in value occurring thereafter, whether due to interest, dividends, or appreciation or depreciation in value of the plan assets, but excluding any contributions attributable to services performed after February 15, 2002.

4. The division of the accounts will be accomplished by adding the aggregate value of all accounts specified in paragraph 3 using the most recent account information available as of the day of the division. Mrs. Moffitt will retain her Schwab IRA, and will be entitled to receive an amount sufficient to bring her total up to 50% of the aggregate value of all accounts. Her distribution shall be made in the first instance from the ING fund. If the amount in the ING fund is insufficient, any additional amount shall come from the AON Corporation savings plan. Both parties shall execute whatever documents are necessary to effect the distribution. The balances in said accounts shall be the balance as of Oct. 31, 2005 and the calculations and transfer shall be done as soon thereafter as practical. Each party shall provide statements as of that date and sign any document or perform any act necessary to accomplish same in a timely fashion.

Despite the requirement that these assets be divided within thirty days, the division had not yet occurred by October 26, 2006, when plaintiff filed her motion to compel preparation of QDROs and direct defendant to provide certain information and sign authorizations to release retirement benefit information.

We first address plaintiff's contention that the trial court erred in applying a February 15, 2002 cut-off date for dividing the Aon pension, when the PSA had not included a cut-off date for that asset. The divorce complaint was filed in February 2002. Plaintiff notes that the judgment provision incorporating the PSA excluded post-complaint contributions for "all assets that are in existence as set forth on Exhibit P-3," and that the Aon pension did not appear on that exhibit. She adds that "[t]he Aon Pension was deliberately not included on Exhibit P-3 so that post contributions would not apply to this pension," and she contends that this was a specifically negotiated term, intended as a trade-off for the inclusion of plaintiff's entirely pre-marital IRA as one of the assets to be divided. Plaintiff asserts that this is why her pre-marital IRA and the Aon pension were both referenced in the same sentence in the divorce judgment.

Relying on Karl's Sales and Service, Inc. v. Gimbel Brothers, Inc., 249 N.J. Super. 487, 493 (App. Div.), certif. denied, 127 N.J. 548 (1991), plaintiff adds that defendant's attorney drafted the divorce judgment, so the agreement should be strictly construed against defendant. Accordingly, plaintiff contends, the court erred in failing to strictly apply the language used in the agreement, which did not include a cut-off date for the Aon pension. Regarding the October 2005 consent order, plaintiff contends that the trial court erroneously relied on paragraph 3, which dealt with 401K plans and IRA funds, not pensions; paragraph 2, which dealt with appointing William Troyan to create QDROs for the pensions, did not include a cut-off date. Plaintiff asserts that Troyan agreed with her interpretation.

In his initial ruling on this issue, the judge agreed with defendant, finding the language in the divorce judgment and consent order very clear in setting as the cut-off date February 15, 2002. In the reconsideration motion proceeding, plaintiff argued that the Aon pension and plaintiff's pre-marital IRA were meant to be linked, and completely divided without a cut-off date. She requested a plenary hearing with witnesses who could testify about it. The court denied the request, concluding that plaintiff failed to make a prima facie showing to support her position.

Although it is possible to read the agreement in the manner that plaintiff suggests, without clear language to the contrary, defendant's and the judge's reading is a more natural interpretation. Moreover, the judge was correct that plaintiff failed to make a prima facie case that her interpretation was correct. She provided nothing more than her bald assertion.

Plaintiff submitted to the court a form QDRO to support her view that Aon permitted use of a divorce judgment date as a date of division. That Aon would permit it is not dispositive. If this issue had been litigated instead of resolved by the parties' PSA, the court would have been correct to use the date the divorce complaint was filed, because that is the date ordinarily used in New Jersey to mark the end date for considering assets to have been acquired during the marriage, which are thus eligible for equitable distribution. Painter v. Painter, 65 N.J. 196, 217-18 (1974). Other dates may be used, in some instances; for example, if parties have entered into a written separation agreement accompanied by actual physical separation, then the date of the agreement will terminate the period of acquisition of distributable assets. Brandenburg v. Brandenburg, 83 N.J. 198, 209 (1980). In the present case, Aon's reference to the divorce judgment date as an example of a permissible date of asset division does nothing to resolve the issue on appeal.

Plaintiff is correct that we stated in Karl's Sales and Service, supra, 249 N.J. Super. at 493, "where an ambiguity appears in a written agreement, the writing is to be strictly construed against the party preparing it." However, we also said that "[t]his rule of construction is somewhat tempered by the principle that although 'a contractual provision should generally be construed narrowly against its drafter, [citation omitted in original], the construction should be sensible and in conformity with the expressed intent of the parties.'" Ibid. (quoting Broadway Maint. Corp. v. Rutgers, 90 N.J. 253, 271 (1982)). In that regard, "'[e]ven where the intention is doubtful or obscure, the most fair and reasonable construction, imputing the least hardship on either of the contracting parties, should be adopted [citation omitted in original], so that neither will have an unfair or unreasonable advantage over the other.'" Ibid. (quoting Tessmar v. Grosner, 23 N.J. 193, 201 (1957)). Applying these principles in light of the language in the divorce judgment and the consent order, particularly in view of the usual approach of terminating asset division as of the date of the divorce complaint, we conclude that the trial court did not err.

Plaintiff's assertion that Troyan agreed with her position on this issue is of no consequence in determination of the issue. In any event, the record does not support plaintiff's assertion.

Plaintiff next contends that the trial court erred in declining to have the parties share the cost of the survivor annuity that she would derive from defendant's St. Paul and Aon pensions, an approach that plaintiff argues is necessary so she can receive the full 50% share to which she is entitled. The court's initial ruling on this issue was that plaintiff was not entitled to any survivor's benefit. On plaintiff's reconsideration motion, however, the judge changed course and ruled that because plaintiff and defendant had each signed a letter agreement providing for plaintiff to receive those survivor benefits, plaintiff was entitled to receive them. Defendant tried to back out of that agreement, stating that he had not been aware that there was a cost to providing such benefits, but the judge held that the agreement to provide benefits would stand, but that plaintiff could be made responsible for the costs.

Plaintiff objected to being held responsible for those costs, but the court noted that defendant would also suffer a loss, because if he were to die before receiving benefits he could only designate his second wife to receive one-half of what he would have received, and there would be no reversionary interest to him of plaintiff's separate interest if plaintiff died first. The court found that plaintiff would receive a "major benefit" because she could receive pension benefits on her separate interest even prior to defendant's retirement, so it seemed only fair that plaintiff, and not defendant, should bear the cost of the reduced monthly payment attributable to that benefit. The court explained that this did not conflict with the PSA's provisions to divide the benefits 50-50, because this amounted to plaintiff's decision to exercise an option for enhanced benefits, for which it was equitable that plaintiff would pay the related costs.

The court's disposition of this issue was fair and reasonable. It was aimed at giving plaintiff an additional benefit that was not specifically addressed by her or her counsel in the divorce judgment or in the consent order. We find no error in the court's requirement that plaintiff pay for the cost of that benefit to her.

We next consider plaintiff's contention that the trial court erred in declining to compel defendant to execute authorizations to provide additional information regarding his pension plans. She asserts that defendant failed to provide full pension information at various times in the proceedings, as a result of which she needs authorization to obtain the information directly from defendant's former employers, Aon and St. Paul.

Defendant asserted at the reconsideration hearing that he had exhaustively supplied information on this subject to plaintiff's various counsel, that he was willingly dividing all plans 50-50, and that there were no undisclosed plans. During the reconsideration hearing, defendant specifically explained that the non-qualified benefit from St. Paul described in a December 20, 2000 letter was the same thing as the executive retirement plan benefit referenced in the St. Paul Benefit Estimate Form dated January 30, 2006. Plaintiff had believed these were two separate plans, and she did not appear to accept defendant's explanation.

At both the motion hearing and the reconsideration hearing, the court held that it was too late to reopen discovery, especially so long after the case had settled and after plaintiff had indicated on the record her satisfaction with the settlement, and particularly because the court held that plaintiff failed to make a prima facie case that additional information was warranted.

We find no error in these rulings. We agree with the court that plaintiff did not demonstrate any special reasons why further discovery at this very late date in the proceedings was warranted. Consequently, plaintiff failed to demonstrate a need for the authorizations she sought. Nor did she demonstrate that defendant needed to convey more information to Troyan.

Plaintiff also contends that the court erred in declining to compel defendant to provide statements regarding the Aon 401K distribution and in denying plaintiff's request for a credit to correct defendant's erroneous calculations. She asserts that defendant provided three different calculations, in letters dated August 10, October 21, and November 4, 2005, all of which provided different results, and she is not satisfied that the correct methodology was used. Analyzing the November 4, 2005 approach, plaintiff believed she was entitled to $18,417.98 more than she received, comprised of a $6,366.17 credit that defendant erroneously allocated as his post-complaint contributions to the 401K, plus $12,051.81 in appreciation on that amount. She disputed the court's view that this matter had been previously litigated, finding authority for her application in the colloquy in the January 20, 2006 motion hearing, when the court stated that plaintiff should open up an investment account to which defendant could transfer her share of the 401K funds, and "[i]f you're unhappy you come back to Court."

Defendant asserts that plaintiff misreads the 401K statements relating to this issue, by counting Aon's year-end-2001 matching contributions as his own contributions, and by using a first-quarter-2002 figure as a starting point, resulting in plaintiff seeking credit for assets in which she had already shared. Defendant further asserts that it makes no sense for plaintiff to claim a right to appreciation on post-complaint contributions, because those assets are solely his.

The court viewed this as another instance in which plaintiff was seeking to change the terms of the settlement or the divorce judgment. The court refused to revisit what it considered an adjudicated matter.

Plaintiff is correct that the October 20, 2005 consent order regarding distribution of retirement assets did not expressly detail the dollar amounts of the assets allocable to plaintiff and defendant, but rather that it set out the procedures for that allocation. Plaintiff is also correct that when she sought on a "reconsideration" motion to obtain certainty as to what amount would be transferred into the investment account she was to open as a result of that consent order, the court ruled: "You open up the account, he makes the transfer. If you're unhappy, you come back to Court."

Plaintiff was entitled to an opportunity to show that defendant violated the consent order and transferred an incorrect sum. However, even if this issue had not been previously adjudicated, any error in the court's refusal to address it was harmless. Because the issue was fully set out in the parties' certifications, briefs, and pro se arguments before the trial court, we are able to decide the issue in the exercise of original jurisdiction. See R. 2:10-5.

The record supports defendant's argument that plaintiff misunderstands the 401K records, and that she has received an accurate allocation. We also agree with defendant that plaintiff has no entitlement to the appreciation of the amounts of the 401K funds that are allocable to him as post-complaint contributions. We therefore deny plaintiff's request to compel defendant to provide statements regarding the Aon 401K distribution and to credit plaintiff with additional sums.

Finally, we address plaintiff's contention that the trial court erred in denying her a counsel fee award. She felt that she should have been awarded counsel fees because defendant's lack of cooperation and honesty caused her to have to file the motions and to incur legal fees. She added that on the 401K distribution issue, she had wanted to resolve the issues in October 2005, but because she waited and followed the court's direction to raise the issue after funds were transferred into her account, this forced her to incur additional legal fees, so her fee request should have been granted.

Plaintiff's notice of motion did not expressly request counsel fees in either her original motion or her reconsideration motion, and the court did not rule on that issue in either instance. Plaintiff did, however, request a counsel fee award in the certification she filed with her motion, stating entitlement to fees because defendant did not timely comply with the court's order regarding establishing the QDROs, and he also withheld information about his benefit plans.

We reject this issue as improperly raised. Alternatively, in the exercise of original jurisdiction, we deny plaintiff's counsel fee request substantively, because her arguments in these motions were, for the most part, without merit.

By way of summary: (1) On A-0573-05T3 (dealing with division of non-retirement assets), we modify the orders appealed from to provide that the parties each pay one-half of the fee for the Morrison report and to vacate the $2700 counsel fee award against plaintiff. In all other respects, we affirm. (2) On A-2949-05T3 (dealing with alimony, child support, tutoring expenses, equitable distribution, and counsel fees), we modify the orders appealed from for the purpose of correcting or clarifying the effective date of the alimony and child support modification and calculation of arrearages. In all other respects, we affirm. (3) On A-3178-06T3 (dealing with
distribution of pension plan benefit), we affirm.

In the tabulation of calculations, Morrison identified $98,070.48 as the value as of June 18, 2003. However, throughout the body of the report, he used September 11, 2003 as the valuation date. As we previously stated, defendant's initial listing of these securities set forth a value as of June 18, 2003 of $99,473.91. When plaintiff and her accountant pointed out the conflicting dates in Morrison's report in an effort to undermine its validity, defendant filed a certification explaining that when he "distributed the money in September of 2003[,] even though the market had declined, [he] still used the higher valuation which benefited the plaintiff by approximately $2,000.00. That was not included in Bill Morrison's report and that would mitigate even further any potential harm to plaintiff." It is apparent that the use by Morrison of the June 18, 2003 date in the tabulation portion of the report was a clerical error.

This figure is less than the approximately $92,000 previously found because the judge did not include defendant's 2004 tax refund ($9623) and reduced from $8550 to $3000 the amount of rental income attributed to him.

(continued)

A-0573-05T3

March 26, 2009

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