IRINA B. ELGART v. MICHAEL ELGART

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-0

IRINA B. ELGART,

Plaintiff-Appellant,

v.

MICHAEL ELGART,

Defendant-Respondent.

________________________________

September 14, 2015

Submitted March 18, 2015 Decided

Before Judges Maven and Carroll.

On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Essex County, Docket No. FM-07-2097-09.

Laufer, Dalena, Cadicina, Jensen & Boyd, LLC, attorneys for appellant (Terryann K. Bradley, of counsel and on the briefs).

Michael Elgart, respondent pro se.

PER CURIAM

This appeal requires us to consider the modification of a child support award where the incomes of the parties exceed the child support guidelines. Isaacson v. Isaacson, 348 N.J. Super. 560, 580-81 (App. Div.), certif. denied, 174 N.J. 364 (2002). Plaintiff Irina Elgart appeals Family Part orders, dated November 1, 2013, and January 10, 2014, which reduced defendant Michael Elgart's child support obligations and denied her motion for reconsideration. Because the November 1, 2013 order is not accompanied by findings of fact and conclusions of law, we are compelled to remand for further proceedings.

I.

This is the second time we have reviewed orders issued in this case. We set forth only the procedural history and facts relevant to this appeal. Irina and Michael were married on August 17, 1997. They have two children, a son born in June 2001, and a daughter born in June 2005. A complaint for divorce was filed on March 20, 2009.

On March 8, 2010, the judge dissolved the marriage on the record. Defendant's counsel was directed to draft the final judgment of divorce (FJD) incorporating the decisions made by the judge. On April 5, 2010, the parties submitted a consent agreement resolving some, but not all, of their issues. After several months of unsuccessful negotiations, the judge conducted a hearing to complete the dissolution of the marriage. On October 20, 2010, the judge resolved their impasse by striking from the proposed property settlement agreement (PSA) any provision that the parties did not agree upon. In addition to several other changes, the judge modified the language in Article 1.4 to exclude the list of extraordinary expenses. The FJD entered that same day incorporated the parties' PSA as revised by the judge.

As finalized, the PSA reflected the parties' agreement to deviate from the New Jersey Child Support Guidelines (Guidelines), Pressler & Verniero, Current N.J. Court Rules (2015), Appendix IX-A to R. 5:6A. Article 1.2 required Michael to pay Irina $1350 monthly in child support for their two children. That provision stated: "The parties agree that the child support amount is not in accordance with the [Guidelines] and is approximately $200 over the Guidelines." Furthermore, it provided that Michael was responsible for "55% of the children's extra-curricular activity expenses, and uninsured medical expenses." Article 1.2 also provided that "[a]ny future adjustments will be pursuant to Article 1.3," however, Article 1.3 was stricken by the court on October 20.

Article 1.4 of the PSA governed extraordinary expenses, and provided: "The parties shall be responsible for paying extraordinary expenses incurred on behalf of the children, 45% Wife and 55% Husband."

In a subsequent order dated March 19, 2012, another judge determined that Michael would pay 55% of certain extraordinary expenses enumerated in that order; specifically, child care expenses incurred from 7:00 a.m. to 6:00 p.m., Hebrew School expenses, either art class or guitar lessons, baseball for their son, in-network dental and orthodontic expenses, and kindergarten tuition. We affirmed that order. Elgart v. Elgart, No. A-4318-11 (App. Div. Aug. 8, 2013) (slip. op. at 14-15).

In May 2013, Michael moved to reduce his child support obligation. He certified that Irina earned substantially more in 2013 than she did at the time of the parties' divorce; that she had higher child care expenses because her babysitter worked longer hours than approved by the court; and that his income decreased because his bonuses had diminished.

Irina filed a cross-motion to enforce the March 19, 2012 order, seeking reimbursement for extraordinary expenses, child care expenses, and medical expenses. In her reply to Michael's motion, she acknowledged that she earned more working full-time. However, she argued that her salary increase "was contemplated when [they] set the child support and negotiated a lower alimony amount for a greater child support obligation. Therefore, this is not a changed circumstance." Irina also explained that she had the same babysitter since October or November 2011. The agreement with the babysitter required payment for a minimum of twenty-five hours per week at an hourly rate of $15.68.

Michael submitted a reply certification, reiterating that Irina's salary increase constituted a changed circumstance. Irina responded by supplemental certification, arguing

I reiterate that any increase of my salary should inure to the benefit of our children, . . . and is not a change in circumstances that warrants a decrease in Michael's base child support payments because: (1) child support was a negotiated amount; (2) a decrease is not in the best interest of the children as they have increased expenses due to age; (3) as parent of primary residence, any increase in my salary ultimately benefits the children and should not be a benefit to Michael; (4) I incur a greater portion of the extraordinary expenses than Michael; (5) Michael's salary has not changed and living expenses have decreased; (6) Michael seeks to benefit from my increase in salary while failing to pay the entirety of work-related childcare expenses that enable me to make this higher salary.

The parties filed case information statements, which revealed that Michael's annualized income for 2013 was $194,370 while Irina's was $181,000. Around that time, Michael paid $1414 in child support per month (due to cost-of-living increases).

On November 1, 2013, the same judge who entered the March 19 order considered the parties' motions.1 The judge recalculated child support using the Guidelines. The worksheet reflects the same income of $3500 per week for both parties, consideration of the alimony paid by Michael to Irina, and the cost of health insurance for the children. Based upon the calculation, the judge ordered Michael to pay Irina $228 per week in child support. Furthermore, the court ordered that Michael "is not responsible for any above guidelines amount of child support. Due to the extensive Hebrew School and extracurricular expenses, from this date forward the extracurricular and extra-ordinary expenses shall be split 50/50 between the parties[.]" The court required Michael to pay Irina $200 per month to satisfy his arrears, which had accrued to $11,590.40. The court attached the Child Support Guidelines worksheet to the order.

Irina moved for reconsideration and argued that the court erred by using the Child Support Guidelines to compute Michael's child support obligation, rather than adhering to the PSA. She pointed out that the parties' incomes were "above the guidelines and a strict imposition of guidelines in our matter is not only inappropriate but deprives our children of the ability to benefit from the financial advantages that [Michael] enjoys."

The court denied Irina's motion for reconsideration by order dated January 10, 2014. Citing Cummings v. Bahr, 295 N.J. Super. 374 (App. Div. 1996), the court wrote that Irina "failed to meet the standards for reconsideration as [she] has failed to provide new information unavailable to her on [November 1, 2013]." This appeal followed.

Irina raises the following points on appeal

POINT I

THE TRIAL COURT'S CHILD SUPPORT DETERMINATION ABSENT ANY CONSIDERATION OF THE STATUTORY CRITERIA AS SET FORTH IN N.J.S.A. 2A:34-23(A) CONSTITUTED PLAIN ERROR.

POINT II

THE TRIAL COURT ABUSED ITS DISCRETION IN LIMITING THE CHILDREN'S CHILD SUPPORT SUCH THAT THEY ARE UNABLE TO ENJOY THE FINANCIAL BENEFITS OF BOTH PARENTS['] GOOD FORTUNE.

POINT III

THE TRIAL COURT ERRED IN FAILING TO ENFORCE THE EXPLICIT TERMS OF THE PARTIES' PROPERTY SETTLEMENT AGREEMENT AND PROVIDING FOR CHILD SUPPORT ABOVE THE GUIDELINES.

POINT IV

THE COURT'S ORDER OF NOVEMBER 1, 2013 PROVIDING DEFENDANT'S CONTRIBUTION TO THE CHILDREN'S EXPENSES AS A SUPPLEMENTAL COMPONENT IS ILLUSORY AND AN ABUSE OF DISCRETION.

II.

Our review of a trial court's fact-finding is limited. Cesare v. Cesare, 154 N.J. 394, 411 (1998). Generally, "findings by the trial court are binding on appeal when supported by adequate, substantial, credible evidence." Id. at 411-12 (citing Rova Farms Resort, Inc. v. Investors Ins. Co. of Am., 65 N.J. 474, 484 (1974)). When reviewing decisions granting or denying applications to modify child support, we examine whether, given the facts, the trial judge abused his or her discretion. Larbig v. Larbig, 384 N.J. Super. 17, 21 (App. Div. 2006); Loro v. Del Colliano, 354 N.J. Super. 212, 220 (App. Div.), certif. denied, 174 N.J. 544 (2002). "The trial court has substantial discretion in making a child support award. If consistent with the law, such an award will not be disturbed unless it is manifestly unreasonable, arbitrary, or clearly contrary to reason or to other evidence, or the result of whim or caprice." Foust v. Glaser, 340 N.J. Super. 312, 315-16 (App. Div. 2001) (citations and internal quotation marks omitted). Accord Tannen v. Tannen, 416 N.J. Super. 248, 278 (App. Div. 2010), aff'd, 208 N.J. 409 (2011). "Of course, the exercise of this discretion is not limitless[,]" and remains guided by the law and principles of equity. Steneken v. Steneken, 367 N.J. Super. 427, 434 (App. Div. 2004), aff'd in part and modified in part, 183 N.J. 290 (2005). An abuse of discretion "arises when a decision is 'made without a rational explanation, inexplicably departed from established policies, or rested on an impermissible basis.'" Flagg v. Essex Cnty. Prosecutor, 171 N.J. 561, 571 (2002) (quoting Achacoso-Sanchez v. Immigration & Naturalization Serv., 779 F.2d 1260, 1265 (7th Cir. 1985)). Finally, we note we are not bound by "[a] trial court's interpretation of the law" and do not defer to legal consequences drawn from established facts. Manalapan Realty, L.P. v. Twp. Comm. of Manalapan, 140 N.J. 366, 378 (1995).

Irina contends that the trial court should have adhered to the PSA child support provisions or, alternatively, should have applied the statutory criteria set forth in N.J.S.A. 2A:34-23(a) because the parties' combined income exceeded $187,200. She further argues that in reducing Michael's obligation to contribute towards extracurricular expenses from 55% to 50%, the court did not satisfy its obligation to craft a supplemental above-guideline child support award because the PSA provided for Michael's contribution to these expenses.

We briefly outline the applicable legal principles that guide the review of this matter. PSAs are essentially contracts between divorcing spouses and should not be "'unnecessarily or lightly disturbed.'" Konzelman v. Konzelman, 158 N.J. 185, 193-94 (1999) (quoting Smith v. Smith, 72 N.J. 350, 358 (1977)). When matters in dispute in a post-judgment matrimonial motion are addressed in a PSA, the agreement is "'entitled to considerable weight with respect to [its] validity and enforceability' in equity, provided [it is] fair and just." Dolce v. Dolce, 383 N.J. Super. 11, 20 (App. Div. 2006) (quoting Petersen v. Petersen, 85 N.J. 638, 642 (1981)). "As a general rule, courts should enforce contracts as the parties intended." Pacifico v. Pacifico, 190 N.J. 258, 266 (2007). This comports with New Jersey's strong public policy favoring settlement of litigation. Harrington v. Harrington, 281 N.J. Super. 39, 46 (App. Div. 1995) (citing Petersen, supra, 85 N.J. at 642; Massar v. Massar, 279 N.J. Super. 89, 93 (App. Div. 1995)).

Nevertheless, parties that have entered into a PSA may still move to modify child support if they demonstrate changed circumstances. Lepis v. Lepis, 83 N.J. 139, 152 (1980). The "[c]hanged circumstances are not confined to events unknown or unanticipated at the time of the agreement." J.B. v. W.B., 215 N.J. 305, 327 (2013) (citing Dolce, supra, 383 N.J. Super. at 19. In J.B. the Court held that, "care must be taken not to upset the reasonable expectations of the parties." Ibid. "When a PSA addresses the changed circumstance, modification of the PSA may not be equitable or fair." Ibid. (citing Lepis, supra, 83 N.J. at 153). "When one or both parents have agreed to undertakings advantageous to a child beyond that minimally required, the public policy favoring stability of arrangements usually counsels against modification." Ibid. (internal citations omitted).

When a court deems it appropriate to modify the child support obligation, any such decision must be made in accordance with the best interests of the children. See Caplan v. Caplan, 182 N.J. 250, 266 (2005); see also Zazzo v. Zazzo, 245 N.J. Super. 124, 130 (App. Div. 1990), ("Children are entitled to have their 'needs' accord with the current standard of living of both parents, which may reflect an increase in parental good fortune."), certif. denied, 126 N.J. 321 (1991).

The court rules require the Family Part to follow the Child Support Guidelines in setting a party's child support obligation. R. 5:6A. However, these guidelines are not strictly applicable where family income exceeds the maximum tabled amount in Appendix IX-F. Pressler & Verniero, supra, comment 1.2 on R. 5:6A. Appendix IX-A "Extreme Parental Income Situations," provides

If the combined net income of the parents is more than $187,200 per year, the court shall apply the guidelines up to $187,200 and supplement the guidelines-based award with a discretionary amount based on the remaining family income (i.e., income in excess of $187,200) and the factors specified in N.J.S.A. 2A:34-23. Thus, the maximum guidelines award in Appendix IX-F represents the minimum award for families with net incomes more than $187,200 per year.

[Pressler & Verniero, supra, Appendix IX-A to R. 5:6A at 2645.]

N.J.S.A. 2A:34-23(a) provides that the court shall consider, but not be limited to, the following factors

(1) Needs of the child;

(2) Standard of living and economic circumstances of each parent;

(3) All sources of income and assets of each parent;

(4) Earning ability of each parent, including educational background, training, employment skills, work experience, custodial responsibility for children including the cost of providing child care and the length of time and cost of each parent to obtain training or experience for appropriate employment;

(5) Need and capacity of the child for education, including higher education;

(6) Age and health of the child and each parent;

(7) Income, assets and earning ability of the child;

(8) Responsibility of the parents for the court-ordered support of others;

(9) Reasonable debts and liabilities of each child and parent; and

(10) Any other factors the court may deem relevant.

We now turn to Irina's contentions. At the outset, we note that our ability to review this matter is hampered by the trial court's failure to articulate its factual findings and conclusions of law. A trial court's obligation to make findings of fact and conclusions of law is critical to an appellate court's "meaningful review." Ronan v. Adely, 182 N.J. 103, 110-11 (2004). This requirement is succinctly stated in Rule 1:7-4(a), which mandates that the court "shall, by an opinion or memorandum decision, either written or oral, find the facts and state its conclusions of law . . . on every motion decided by a written order that is appealable as of right." "Naked conclusions are insufficient. A judge must fully and specifically articulate findings of fact and conclusions of law. The absence of adequate findings . . . necessitates a reversal. . . ." Heinl v. Heinl, 287 N.J. Super. 337, 347 (App. Div. 1996) (citations omitted).

Moreover, the record before us does not include the transcript for the November 1, 2013 proceeding, which might have illuminated the judge's reasoning. In Loro, supra, 354 N.J. Super. at 220, we held that "[w]hile the judge's stated reasons [were] not a paradigm of the findings required by [Rule] 1:7-4, a culling of the text of the orders together with the extended colloquy with counsel over this multi-day oral argument provide[d] a sufficient basis for the award entered." In this case, without a transcript of the oral argument we cannot garner an understanding of the judge's findings and conclusions.

The November 1 order provides no insight into the judge's reason for departing from the parties' PSA, which provided for above-guideline child support. Nor does it reflect consideration of the statutory criteria set forth in N.J.S.A. 2A:34-23(a) for discretionary above-guideline child support awards. We have only the parties' competing certifications and a child support worksheet, which are insufficient for appellate review. Under these circumstances, we cannot meaningfully review the modification of Michael's child support obligations. Consequently, we are compelled to reverse the November 1, 2013 order and remand for the court to reconsider the parties' cross-motions.2 We also vacate the January 2014 order denying reconsideration.

On remand, the court must consider the parties' PSA that clearly indicates Irina and Michael's agreement to deviate from the guidelines. If the court finds changed circumstances sufficient to warrant a departure from the PSA, then it must articulate its reasons for doing so.

If the court recalculates Michael's child support obligation, then it must take into account that the parties' combined income exceeded $187,200. See Pressler & Verniero, supra, Appendix IX-A to R. 5:6A at 2645; N.J.S.A. 2A:34-23. This combined approach should result in a fair award of child support that is in the best interests of the children. Caplan, supra, 182 N.J. at 266.

With regard to Irina's request for reimbursement of expenses, we likewise find the court's decision lacking. Although the order alludes to "extensive Hebrew School and extracurricular expenses," it does not delineate why these expenses justify a departure from the PSA and March 19, 2012 order, which both provided for a 55%/45% division of these extracurricular expenses, or why Michael's contribution was reduced to 50%.

Given the nature of this record, we reverse and remand for the court to evaluate the facts and equities in light of the legal standards set forth in this opinion. Upon further review, should the court determine that Michael has proven a prima facie case of changed circumstances, it may order a period of discovery and, if warranted, a plenary hearing. We leave these determinations to the sound discretion of the motion judge. The judge is also directed to comply with Rule 1:7-4 when rendering the decision on the motions.

Reversed and remanded. We do not retain jurisdiction.

1 Although the order indicates that both parties appeared before the court, a transcript of that proceeding was not provided.

2 The record contains an order dated January 28, 2014, transferring venue to the Passaic Vicinage.