JOANNE MARIE RODRIGUES v. JOSE MIGUEL RODRIGUES

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-0

JOANNE MARIE RODRIGUES,

Plaintiff-Respondent,

v.

JOSE MIGUEL RODRIGUES,

Defendant-Appellant.

______________________________________________________

August 18, 2015

Argued May 5, 2015 Decided

Before Judges Ostrer, Hayden and Sumners.

On appeal from Superior Court of New Jersey,

Chancery Division, Family Part, Essex County, Docket No. FM-07-17-09.

Jeffrey W. Plaza argued the cause for appellant (Ehrlich, Petriello, Gudin & Plaza, attorneys; Mr. Plaza, on the brief).

Laurie L. Newmark argued the cause for respondent (Townsend, Tomario & Newmark, LLC., attorneys; John E. Clancy, on the brief).

PER CURIAM

Defendant, Jose Rodrigues, appeals from certain parts of the October 28, 2013 Judgment of Divorce (JOD) concerning alimony and equitable distribution, and the February 7, 2014 order denying his motion for reconsideration. For the reasons that follow, we affirm in part and reverse in part and remand for further proceedings.

The record reveals that defendant and plaintiff, Joanne Marie Rodrigues, were married in 1994 and had two children. The parties purchased the property for their marital home in 1998 for about $90,000, with $50,000 provided by defendant's father and the balance taken from their savings. They also borrowed $190,000 from defendant's sister and husband to finance construction of a five-thousand-square-foot home on the property. Shortly after construction was completed in 2002, the parties repaid most of the debt to defendant's sister and husband through a home equity loan and signed a promissory note for the remaining balance, on which they continued to make payments over the years.

Plaintiff filed for divorce in January 2009 after a little more than fourteen years of marriage. Prior to trial, the parties reached an agreement regarding parenting time and custody. Thereafter, the Family Part judge held a six-day trial on financial issues between October 3, 2011 and December 6, 2012. On October 28, 2013, the court entered the JOD.

In her oral decision, the judge determined that the parties maintained a "comfortable" standard of living, and accepted plaintiff's contention that the marital lifestyle was $160,000 per year.1 The court also noted that both parties worked throughout the marriage. Specifically, defendant had a master's degree in international finance that he obtained during the marriage, and generally earned about $90,000 in salary.

From 1999 to 2004, defendant also engaged in day trading of stocks, executing a total of about $18 million in trades over that period. Defendant realized gains in 1999 and 2001, but experienced losses in the remaining years for a net loss of $365,149. Defendant testified that plaintiff was generally aware of his trading activity. Nonetheless, defendant admitted that he signed plaintiff's name to margin agreements and other documents without discussing the matter with her and took steps to conceal the extent of his losses because he was afraid she would want a divorce. Indeed, defendant acknowledged in his brief that within two months of plaintiff discovering the extent of his losses, the parties had separated.

On the other hand, plaintiff testified that early on she forbade defendant from continuing trading and believed that he had stopped. She denied knowing of defendant's continued activity and significant losses until 2008, when she began investigating their finances.

Plaintiff has a high school diploma and attended a few college classes, but never obtained a degree. During the marriage, she worked part-time to accommodate her role as the children's primary caregiver. By the time of trial, she had been employed as an administrative assistant for approximately twenty-one years and earned an average of $53,000 per year in the previous three years while working twenty-four to thirty hours per week.2 Plaintiff testified that she was diagnosed with Sjogren's Syndrome, a condition affecting the moisture-producing glands around the eyes and mouth, and Hashimoto Syndrome, which impacts thyroid functioning. Even so, she did not contend that these conditions affected her employment or her ability to work.

In the JOD, among other relief, the judge (1) equitably distributed the marital assets fifty-fifty after credits and deductions; (2) granted plaintiff a credit of one-half of defendant's trading losses; (3) decided the funds from defendant's family to help purchase property and pay property taxes were not proven to be loans; (4) determined that the parties lived a comfortable marital lifestyle; (5) granted plaintiff permanent alimony in the amount of $200 per week. Defendant moved for reconsideration, which the court denied. This appeal followed.

On appeal, concerning equitable distribution, defendant first argues that the court erred by giving plaintiff a credit for half the net losses he incurred as a day trader. We disagree.

We begin by reviewing the well-established principles that guide our analysis. In a divorce action, the court has the authority to "make such award or awards to the parties . . . to effectuate an equitable distribution of the property, both real and personal, which was legally and beneficially acquired by them or either of them during the marriage or civil union." N.J.S.A. 2A:34-23(h). "The goal of equitable distribution . . . is to effect a fair and just division of marital assets." Steneken v. Steneken, 367 N.J. Super. 427, 434 (App. Div. 2004), aff'd as modified, 183 N.J. 290 (2005). A party seeking to shield any portion of an asset from distribution bears the burden of establishing its immunity. Pacifico v. Pacifico, 190 N.J. 258, 269 (2007).

In determining an appropriate allocation for equitable distribution, the court may consider

a. The duration of the marriage or civil union;

b. The age and physical and emotional health of the parties;

c. The income or property brought to the marriage or civil union by each party;

d. The standard of living established during the marriage or civil union;

e. Any written agreement made by the parties before or during the marriage or civil union concerning an arrangement of property distribution;

f. The economic circumstances of each party at the time the division of property becomes effective;

g. The income and earning capacity of each party, including educational background, training, employment skills, work experience, length of absence from the job market, custodial responsibilities for children, and the time and expense necessary to acquire sufficient education or training to enable the party to become self-supporting at a standard of living reasonably comparable to that enjoyed during the marriage or civil union;

h. The contribution by each party to the education, training or earning power of the other;

i. The contribution of each party to the acquisition, dissipation, preservation, depreciation or appreciation in the amount or value of the marital property, or the property acquired during the civil union as well as the contribution of a party as a homemaker;

j. The tax consequences of the proposed distribution to each party;

k. The present value of the property;

l. The need of a parent who has physical custody of a child to own or occupy the marital residence or residence shared by the partners in a civil union couple and to use or own the household effects;

m. The debts and liabilities of the parties;

n. The need for creation, now or in the future, of a trust fund to secure reasonably foreseeable medical or educational costs for a spouse, partner in a civil union couple or children;

o. The extent to which a party deferred achieving their career goals; and

p. Any other factors which the court may deem relevant.

[N.J.S.A. 2A:34-23.1.]

The court's undertaking in distributing the marital assets is not a "mechanical" one, but one sensitive to the equities of the particular case, Stout v. Stout, 155 N.J. Super. 196, 205 (App. Div. 1977), and entrusted to its broad discretion. Steneken, supra, 367 N.J. Super. at 435. Consequently, the trial court's decision will not be disturbed absent an abuse of discretion. See Sauro v. Sauro, 425 N.J. Super. 555, 573 (App. Div. 2012), certif. denied, 213 N.J. 389 (2013); La Sala v. La Sala, 335 N.J. Super. 1, 6 (App. Div. 2000), certif. denied, 167 N.J. 630 (2001). Moreover, we accord deference to the trial court's findings of fact so long as they are supported by substantial credible evidence in the record. Cesare, supra, 154 N.J. at 411-12. Such deference is particularly appropriate in light of the Family Part's "special expertise in the field of domestic relations" and its opportunity to observe the witnesses' testimony first-hand in making credibility determinations. Id. at 412.

Here, the judge's decision to award plaintiff credit for half of the trading losses incurred by defendant was supported by sufficient credible evidence in the record. See Sauro, supra, 425 N.J. Super. at 573. In granting this credit, the judge found plaintiff's testimony that defendant continued to engage in trading even after she told him to stop to be more credible. The judge did not find that defendant intentionally dissipated the assets in contemplation of divorce, but found that over the course of years, defendant purposely hid the losses and the repayment must have affected the marital assets. Certainly, in fashioning equitable distribution, a court may consider not just intentional dissipation but each parties' contribution to the "acquisition" and "preservation" of marital property. N.J.S.A. 2A:34-23.1(i)

We decline to overturn the judge's credibility finding especially in light of the fact that defendant acknowledged that he took steps to conceal the losses from plaintiff. See Cesare, supra, 154 N.J. at 412. The judge properly used her discretion and her equitable powers to shield plaintiff from the lasting effects of defendant's conduct, which potentially jeopardized their marital assets. See La Sala, supra, 335 N.J. Super. at 6; see also N.J.S.A. 2A:34-23.1(i), (p).

In addition, defendant argues that the funds his father provided the parties to acquire and maintain the marital home were loans and as such, the trial court should have either required reimbursement or granted him a credit for half of the loan amount in equitable distribution. We disagree.

Here, the record supports the judge's determination. Defendant failed to establish that his father's $50,000 contribution in 1998 to help the parties purchase the marital home was a loan rather than a gift. In addition, as the court found, defendant did not provide proof that two checks covering real estate taxes were loans. Although defendant's father and sister testified that all the funds were loans, there were no notes or other documentation supporting this claim. Moreover, the parties never made any payments to reimburse the funds and defendant's father never attempted to collect the loan until the divorce proceedings began.

In stark contrast, as the judge noted, when defendant's sister and her husband lent the parties money to build their house, they signed a promissory note and had documentation detailing their repayment efforts. The judge's finding that the lack of similar conduct with respect to the $50,000 from defendant's father and the two checks indicates that the money was a gift is entitled to our deference. Cesare, supra, 154 N.J. at 411-12. Consequently, we decline to overturn the judge's findings on this issue. Ibid.

Next, defendant contends that the judge erred in awarding plaintiff permanent alimony. Specifically, defendant argues that, at most, plaintiff should have been awarded limited duration alimony, and that the court failed to consider all of the factors set forth in N.J.S.A. 2A:34-23(b). Conversely, plaintiff argues the judge's finding that the parties had a long-term marriage entitling her to permanent alimony was made based on a correct analysis of all the statutory factors.

In divorce actions, the court may award alimony of several different types, including permanent alimony, depending on what is appropriate to the individual circumstances of the parties. N.J.S.A. 2A:34-23(b). The alimony statute "reflect[s] the important policy of recognizing that marriage is an adaptive economic and social partnership[.]" Cox v. Cox, 335 N.J. Super. 465, 479 (App. Div. 2000). A court must first determine if permanent alimony is appropriate and "if the trial court determines that an award of permanent alimony is not warranted, then the court must make specific findings, based on the evidence, setting out the reasons." Gnall v. Gnall, __ N.J. __ (2015) (slip op. at 18).

Permanent alimony is meant to assure a dependent spouse a level of "maintenance sufficient to support that spouse based on the living standards of the couple during marriage." Konzelman v. Konzelman, 158 N.J. 185, 195 (1999). "The purpose of this type of alimony is to allow the dependent spouse to live the same lifestyle to which he or she grew accustomed during the marriage." Gnall, supra, __ N.J. __ (slip op. at 19) (citing Crews v. Crews, 164 N.J. 11, 26 (2000). It is often granted in marriages "of long duration when there is economic need, in recognition of the increased earning capacity of the supporting spouse at the cost of the supported spouse's lost economic opportunities." Gonzalez-Posse v. Ricciardulli, 410 N.J. Super. 340, 353 (App. Div. 2009).

In contrast, an award of limited duration alimony is meant to "provide[] flexibility for those situations when [either] no alimony or permanent alimony would be unjust." J.E.V. v. K.V., 426 N.J. Super. 475, 488 (App. Div. 2012). It is "available to a dependent spouse who made 'contributions to a relatively short-term marriage that . . . demonstrated the attributes of a marital partnership' [but] has the skills and education necessary to return to the workforce." Gordon v. Rozenwald, 380 N.J. Super. 55, 65-66 (App. Div. 2005) (quoting Cox, supra, 335 N.J. Super. at 483) (quotation marks omitted). "All other statutory factors being in equipoise, the duration of the marriage marks the defining distinction between whether permanent or limited duration alimony is warranted and awarded." Gnall, supra, __ N.J. __ (slip op. at 20) (quoting Cox, supra, 335 N.J. Super. at 483). Nonetheless, our courts have cautioned that "the proper amount or duration of alimony . . . do[es] not correlate in any [precise] mathematical formula" with the length of the marriage, but is responsive to the equities of each case. Lynn v. Lynn, 91 N.J. 510, 518 (1982).

"Whether alimony should be awarded is governed by distinct, objective standards defined by the Legislature in N.J.S.A. 2A:34-23(b)." Gnall, supra, __ N.J. __ (slip op. at 16). In evaluating whether such an award is appropriate, a court must consider

(1) The actual need and ability of the parties to pay;

(2) The duration of the marriage or civil union;

(3) The age, physical and emotional health of the parties;

(4) The standard of living established in the marriage or civil union and the likelihood that each party can maintain a reasonably comparable standard of living . . .;

(5) The earning capacities, educational levels, vocational skills, and employability of the parties;

(6) The length of absence from the job market of the party seeking maintenance;

(7) The parental responsibilities for the children;

(8) The time and expense necessary to acquire sufficient education or training to enable the party seeking maintenance to find appropriate employment, the availability of the training and employment, and the opportunity for future acquisitions of capital assets and income;

(9) The history of the financial or non-financial contributions to the marriage or civil union by each party including contributions to the care and education of the children and interruption of personal careers or educational opportunities;

(10) The equitable distribution of property ordered and any payouts on equitable distribution, directly or indirectly, out of current income, to the extent this consideration is reasonable, just and fair;

(11) The income available to either party through investment of any assets held by that party;

(12) The tax treatment and consequences to both parties of any alimony award, including the designation of all or a portion of the payment as a non-taxable payment;

(13) The nature, amount, and length of pendente lite support paid, if any; and

(14) Any other factors which the court may deem relevant.

[N.J.S.A. 2A:34-23(b).3]

A decision whether to award alimony or as to what form or amount would be appropriate lies within the family court's broad discretion. Jacobitti v. Jacobitti, 135 N.J. 571, 575 (1994). We will not overturn an alimony award unless we find

that the trial court clearly abused its discretion or failed to consider all of the controlling legal principles, or we must otherwise be satisfied that the findings were mistaken or that the determination could not reasonably have been reached on sufficient credible evidence present in the record after considering all of the proofs as a whole.

[Gonzalez-Posse, supra, 410 N.J. Super. at 354.]

In this case, the judge determined that she was going to award permanent alimony, reasoning as follows

As I said before, these parties have been married, at the time the complaint for divorce was filed, for at least 15 years. That makes this a long-term marriage, and because it's a long-term marriage . . . I'm going to award permanent alimony. I don't find there's a basis, as defendant was asking for, limited duration alimony. These parties were married a long time. That's a significant factor in this [c]ourt considering and awarding permanent alimony.

The other factor that is significant . . . is that defendant, throughout the marriage, earned substantially more than the plaintiff, and therefore that's another basis upon which this [c]ourt is going to award permanent alimony.

Our decision here is informed by the Supreme Court's very recent articulation of the long-standing statutory and case law concerning the award of alimony. In Gnall, the trial court declined to consider permanent alimony because the parties had been married about fifteen years and the trial court incorrectly determined that permanent alimony was only reserved for longer marriages of at least twenty-five years, without considering the other statutory factors. Gnall, supra, __ N.J. __ (slip op. at 4, 24). The Court held that "the trial court improperly weighed duration over the other statutorily defined factors in determining a long-term marriage must be twenty-five years or more." Id. at 25. The Court further determined that this court, in reversing the trial court, compounded the error by implying that all fifteen-year marriages were long-term and warranted permanent alimony rather than limited duration alimony. Ibid. The Court underscored that in determining whether permanent alimony is warranted, "all thirteen factors must be considered and given due weight, and the duration of marriage is only one factor to be considered." Id. at 25-26. As a result, the Court remanded the case to the trial court "for new findings of fact and a new determination of alimony." Ibid.

We are convinced that the trial judge's alimony decision in the case at bar suffers from the same infirmity as the trial court's decision did in Gnall. The judge in this case determined that the length of the marriage, which she called long-term, warranted permanent alimony without analyzing the remaining factors. While the judge then did consider the other factors, it was for the purpose of deciding the amount of alimony, not whether permanent alimony should be awarded. Consequently, we remand to the trial court for an analysis of the thirteen statutory factors to determine whether permanent alimony is appropriate here and to make specific findings of fact and a new determination on alimony. See ibid.

Affirmed in part and reversed in part and remanded for proceedings consistent with this opinion. We do not retain jurisdiction.

1 Defendant disagrees with this finding although he failed to provide his estimate of the joint marital lifestyle in the most recent case information statement. As the judge's factual finding was supported by credible evidence in the record, we must defer. Cesare v. Cesare, 154 N.J. 394, 411-12 (1998).

2 The judge found that plaintiff received $37.63 per hour at this job and that if she ordered plaintiff to obtain full time employment, it was highly unlikely that as a high school graduate, she would receive more than $15 to $20 per hour.

3 We note that the statute was amended in 2014. L. 2014, c. 42, 2 (eff. Sept. 10, 2014). The Court in Gnall noted that the amendment did not apply in that case, which was decided by the trial court before the amendments. Gnall, supra, __ N.J. __ (slip op. at 18). Similarly, as this case was decided prior to the amendment, it does not apply.