MG v EG

[*1] MG v EG 2005 NY Slip Op 51731(U) [9 Misc 3d 1122(A)] Decided on September 8, 2005 Supreme Court, Nassau County Falanga, J. Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431. This opinion is uncorrected and will not be published in the printed Official Reports.

Decided on September 8, 2005
Supreme Court, Nassau County

MG, Plaintiff

against

EG, Defendant



99-005242

Anthony J. Falanga, J.

There are four motions before the Court. By order to show cause dated February 8, 2005, the plaintiff moves for an order in the action commenced under index number 99-005242 (hereafter matrimonial action) for the following relief: 1) "clarifying" the support provisions of the parties' stipulation of settlement dated March 29, 1999 (hereafter stipulation) "consistent with the respective financial circumstances of the parties and the needs of the children;" 2) granting a money judgment in the sum of $67,248.74, with interest thereon, as and for arrears accrued through February 2005; 3) granting a money judgment pursuant to DRL 244(a) for additional arrears which may accrue through the date of any hearing or determination; 4) "clarifying" the stipulation "to evidence the intention of the parties and the best interests of the children with respect to the defendant's child support obligation in conjunction with the defendant's private school tuition obligations;" and 5) directing the defendant to procure a motor vehicle for plaintiff.

The defendant cross moves in the matrimonial action for an order dismissing the plaintiff's order to show cause and compelling her to participate in mediation. He also seeks an award of counsel fees. The defendant contends that the stipulation is not ambiguous and does not require clarification. He further contends that the plaintiff's application for "clarification" of the stipulation is barred by the doctrine of ratification in that she accepted benefits of the [*2]stipulation for six years and sought enforcement thereof in the Nassau County Family Court.

On April 5, 2005, the plaintiff commenced the above captioned action 05-006696 (hereafter plenary action) asserting three causes of action. The first cause of action seeks judgment establishing child support based upon CSSA guidelines on the grounds that the child support provisions of the parties' stipulation are "unfair and unjust" and the parties' children's needs are not being met. The second cause of action alleges that the stipulation fails to "properly explain why the parties opted not to utilize the CSSA in order to calculate a constant child support obligation for the defendant," and seeks judgment establishing child support pursuant to CSSA guidelines. The third cause of action alleges that the needs of the parties' children have increased significantly and are not being met by the child support received by the plaintiff. Said cause of action seeks an upward modification of child support.

The defendant moves in the plenary action for an order dismissing the complaint on the following grounds: 1) the action cannot be maintained because there is another action pending between the parties for the same relief; 2) the action is barred by the statute of limitations; 3) collateral estoppel; and 4) the complaint fails to state a cause of action. The defendant seeks a further order compelling the parties to mediate the plaintiff's claims, and he seeks an award of counsel fees.

The plaintiff moves for an order pursuant to CPLR 602 consolidating the above captioned actions.

The motions are decided as follows:

The parties were married on December 31, 1986 in Israel. There are four children of the marriage, to wit: J born February 7, 1989 (age 16); J born June 9, 1992 (age 13); A born March 7, 1994 (age 11); and D born March 15, 1996 (age 9). The parties were divorced pursuant to judgment dated May 12, 2000, which incorporates, but does not merge, the stipulation dated March 29, 1999. On February 17, 2000, the parties executed a modification agreement modifying the parenting time and visitation provisions of the stipulation. Said modification agreement provides in paragraph "12" that except as specifically modified, all other terms and conditions of the stipulation are confirmed and continued and declared to be in full force and effect.

The stipulation recites that the defendant's reported 1040 income in 1997 was $294,487.00 less FICA of $4054.00, and that his income for 1998 is substantially similar. The stipulation also states that said income does not include use of corporate cars and other personal expenses paid by the defendant's company. The wife's income is zero (page 26). The stipulation obligates the defendant to pay spousal maintenance of $34,996.00 a year, taxable to the plaintiff, for 13 years from the date of execution of the stipulation; and $17,498.00 a year for three years thereafter. This obligation terminates only upon the death of either party and not upon the remarriage of the plaintiff. The defendant is obligated to pay the following expenses on behalf of [*3]the plaintiff for eight years or until her remarriage or the death of either party, whichever occurs soonest: repair and maintenance of plaintiff's automobile; AAA membership; up to $100.00 a month for gasoline; health insurance; up to $75.00 every four weeks for long distance phone calls; up to $25.00 every four weeks for cell phone, and synagogue dues for the family. He is also required to pay up to $2000.00 a year for three years toward the plaintiff's schooling or course work and to purchase a replacement automobile for her within eight years of the execution of the stipulation. The defendant's payment of the aforesaid items is not taxable income to the plaintiff (pages 30-34).

With regard to child support, the stipulation states that the defendant's obligation to pay child support on the first $80,000.00 of joint parental income would be $24,800.00 a year. It further states that his child support obligation on the total combined parental income of $294,487.00 less FICA of $4054.00 would be $90,000.00 a year or $7500.00 a month. The stipulation does not state that his obligation would be $79,185.00 a year or $6599.00 a month if his obligation to pay maintenance was deducted from his income before calculating the applicable child support percentage (pages 25-27).

Pursuant to the stipulation, Article V, Paragraph A, the defendant is required to pay child support of $36,660.00 a year until the emancipation of the youngest child (pages 13-14). However, the plaintiff is required to utilize $20,000.00 of said $36,660.00 to pay Jewish day school tuition for the children, leaving her only $16,660.00 a year child support, plus her annual maintenance of $34,996.00 to meet all her own needs and those of the children. The defendant is required to pay Jewish day school expenses in excess of $20,000.00, but his obligation to pay child support is decreased by $5000.00 for each child who does not attend Jewish day school (pages 14-15). He is obligated to provide medical coverage for the children and to pay their uncovered health expenses. If his annual income exceeds $180,000.00, he must pay the cost of camp, teen tours, summer activities and air travel to Israel for the children until age 16. He must also pay the costs of Bar or Bat Mitzvahs, and for child care under limited circumstances.

Although the defendant's CSSA obligation would have been $24,800.00 on the first $80,000.00 of joint parental income; $79,185.00 a year on total parental income less annual maintenance and FICA; or $90,000.00 a year on total parental income less FICA, the stipulation requires the defendant to pay child support of only $16,660.00 a year, excluding funds to be applied toward parochial school.

The stipulation states that the parties intend that child support be governed by the agreement and not by CSSA (page 27). It states that "(t)he reason this agreement provides for an amount of child support different than that calculated under those statutes is because it is for the benefit of the children and due to the fact of the parties' respective incomes and income potential, that the level of income is far in excess of $80,000.00, and the level of child support (direct and indirect), health care, education, child care and estate provisions being made by the father for the children is beyond statutory measure, and is adequately provided for elsewhere in this agreement, is sufficient to meet the reasonable needs of the children until emancipation." The stipulation [*4]further provides that in the event the Court does not approve the child support provisions, the parties agree to renegotiate same (page 28).

The provision relating to the reduction in child support in the event one or more children stops attending Jewish day school is ambiguous. The ambiguity results in part from the fact that the stipulation requires the plaintiff to pay the first $20,000.00 of parochial school costs, rather than requiring her to pay the first $5000.00 per child, but affords the defendant a $5000.00 reduction in child support for each child not attending parochial school ( Note: While the defendant states in his cross motion at paragraph 53 that plaintiff is required to pay the first $5000.00 per child, the stipulation does not so state.) Findings of Fact made by Hearing Examiner Neil Miller, Nassau County Family Court, dated November 2, 2002 (plaintiff's exhibit D on the order to show cause dated February 8, 2005) indicate that tuition expenses incurred by the children were $34,500.00 for the 2001-2002 school year and $38,450.00 for the 2002-2003 school year. If the stipulation is construed literally, the defendant's obligation to pay direct child support would be reduced to $26,660.00 per year if two children stopped attending parochial school (a $5000.00 reduction per child), but the plaintiff would still have to pay approximately $20,000.00 in educational expenses for the other two children, leaving her only $6600.00 to meet the needs of four unemancipated children.

Pursuant to the stipulation, the defendant's "child support obligation of Article V, Paragraph A" is further reduced by his payment of college expenses. The defendant is obligated to pay college expenses for the children up to the cost of attendance at a New York State university. However, when one child attends college, his "child support obligation as defined in Paragraph A" is reduced by one half of any college expenses paid by the defendant in excess of $5000.00 a year, except that child support shall not be reduced below 75% of the amount set forth in Paragraph A. When two children attend college, the same provision is applicable except child support may be reduced to 60% of said amount. When three children attend college, child support may be reduced to 35% and when the fourth child attends college, child support may be reduced to 20% of said amount (pages 16-18).

The aforesaid provisions are clearly ambiguous. It is unclear whether the "child support as defined in Paragraph A" is the entire $36,660.00 or the reduced amount the defendant is required to pay if one or more children stops attending parochial school. Under the second interpretation, the defendant's obligation to pay child support would be reduced by $5000.00 to $31,660.00 when the first child attends college as said child would no longer be attending Jewish Day school. The defendant's child support obligation would then be reduced up to 75% of $31,660.00 to $23,745.00 a year. If the stipulation obligates plaintiff to pay the first $20,000.00 of Jewish day school costs for the other three children, she would have only $2375.00 a year left to meet the needs of four unemancipated children. When the second child attends college, the defendant's obligation to pay child support would be reduced to $26,660.00 a year as two children would no longer be attending Jewish Day school, leaving him obligated to pay only 60% of $26,660.00 or $15,996.00 a year. As it appears that parochial school costs for the two younger children would be approximately $20,000.00 a year, the plaintiff would have no funds to support [*5]three unemancipated children (the eldest may be emancipated when the second child attends college). Even if plaintiff would be required to pay only $5000.00 a year per child toward parochial school, she would still have to support three children on $5996.00 a year.

Commencing September 2003, the three younger children attended public school and J attended parochial school at a cost of approximately $12,000.00 a year. Since that date, the defendant has reduced child support by $20,000.00 a year to $16,660.00. The plaintiff states she has paid $10,000.00 a year for Js school costs, leaving her only $6660.00 to provide for all the needs of the children. Once Jeremy starts college, direct child support for four children will total only $16,660.00 a year as none of the children will be in parochial school. Seventy-five percent of $16,660.00 is $12,495.00; 60% is $9996.00; 35% is $5810.00 and 20% is $3332.00. In seven years, when the third child attends college, three of the parties' children will be unemancipated, but the defendant's child support obligation will be only $5810.00 a year and the plaintiff's maintenance will be reduced to $17,498.00.

The stipulation provides that if any party seeks to modify child support, the parties will "discuss and work out the modification themselves." In the event they are unable to reach an accord, they agree to participate in mediation. If attempts at mediation are unsuccessful, the parties may seek arbitration or apply to a court of competent jurisdiction ( page 29). No procedural provisions are made regarding mediation or arbitration. The stipulation does not address the selection of a mediator nor apportion the expense thereof. Article XIX of the stipulation sets forth a general provision that in the event a dispute arises, regarding some aspect of the agreement, the parties will seek mediation services prior to commencing an adversarial proceeding. Article XIII provides, however, that if a default remains uncured after 10 days written notice, the aggrieved party may institute legal action for appropriate relief. The stipulation further provides that in the event the defendant fails to pay child support and or child support "add-ons," he shall be liable for all expenses incurred by plaintiff including, but not limited to, reasonable attorney's fees and disbursements. The stipulation states that he shall be liable for interest at the statutory rate on "all amounts not paid by the wife." This last provision is ambiguous and may be the result of a typographical error.

The plaintiff alleges that the defendant owes the following arrears through February 2005: child support $28,462.51; medical expenses $561.96; dental insurance $211.00; orthodontia $3002.00; parochial education $27,580.00; Bat Mitzvah $2880.00; summer travel $3697.00; car expenses $1110.00; long distance phone bills $116.00; and cell phone $50.00. She does not set forth any calculations supporting her claim of child support arrears of $28,462.51. It appears that the plaintiff contends that the defendant's child support obligation should be $36,660.00 a year whether or not any child attends parochial school and she has assessed direct child support arrears at that said rate between September 2003 and February 2005.

The defendant responds that plaintiff planned J's Bat Mitzvah without consulting with him or inviting his family, thereby relieving him of any obligation to pay said expense. He concedes that since August 2003, he has paid only $640.00 bi-weekly, or $16,660.00 a year, [*6]direct child support for four children. He contends that this sum constitutes his entire obligation pursuant to the stipulation, and states that he does not owe any direct child support arrears. He asserts that he was entitled to reduce child support by $15,000.00 a year when the three younger children entered public school and he further contends that he was entitled to reduce child support by an additional $5000.00 on the ground that the plaintiff enrolled J in a particular yeshiva without his consent thereby relieving him of his obligation to contribute toward said expense. He denies owing any arrears for educational costs on the same ground. The defendant states he has paid the claimed $561.96 in medical expenses. He denies responsibility for dental and orthodontia expenses on the ground that plaintiff failed to utilize his available insurance. He states his annual income was less than $180,000.00 absolving him of the obligation to pay summer travel expenses, and he alleges he has paid the claimed outstanding telephone and car bills.

Plaintiff's vehicle, a Plymouth minivan is presently 12 years old. The vehicle was 4 years old at the time of the execution of the stipulation. The plaintiff has demanded a new Plymouth minivan. The defendant contends that as the stipulation requires him to provide her with a "replacement" vehicle, he is required only to provide her with a 4 year old minivan. As the parties are unable to agree on the meaning of the term "replacement vehicle," this provision is also ambiguous.

The plaintiff's attorney's affirmation, in support of plaintiff's order to show cause in the matrimonial action, asserts that plaintiff is entitled to "clarification/modification" of the stipulation on the ground that "as currently written, it will yield terribly unfair results for the parties' children and an inequitable windfall to the defendant." Counsel is not clear as to whether she is seeking rescission/ reformation of the stipulation or modification, but the precedent she cites supports only a claim for an upward modification on the ground of unmet needs. To the extent that plaintiff's order to show cause in the matrimonial action seeks rescission/reformation of the stipulation, said claim is denied as such relief may be sought only by a plenary action (see, Deppe v Deppe, 287 AD2d 480; Spataro v Spataro, 268 AD2d 467). Her order to show cause is deemed to be for an order granting an upward modification of child support. Accordingly, the cause of action for an upward modification of child support asserted in her plenary action is dismissed on the ground that a proceeding for the same relief was pending before the Court in the matrimonial action at the time the plenary action was commenced.

The defendant's contends that plaintiff's order to show cause in the matrimonial action should be denied and her plenary action should be dismissed on the ground that the stipulation requires that the parties mediate disputes arising under said stipulation as a prerequisite to seeking judicial relief.

The law is well settled that child support issues are arbitrable, but are subject to judicial review and vacatur on public policy grounds where the arbitration award is adverse to the best interests of children (see, Hirsch v Hirsch, 37 NY2d 312; Gottesman v Gottesman, 290 AD2d 201; Hampton v Hampton, 261 AD2d 362). Matrimonial agreements to mediate are similarly enforceable (see, Edwards v Poulmentis, 307 AD2d 1051; see also, Lewittes v Lewittes, [*7]12 AD3d 221).

In deciding the defendant's motion to dismiss the plenary action, and his cross motion to deny plaintiff's order to show cause in the matrimonial action, on the ground that plaintiff failed to mediate her claims prior to commencing judicial proceedings, the Court must first determine whether the parties' stipulation constitutes an agreement to submit such claims to mediation. Once the requisite relationship is established between the subject matter of the litigation and the mediation provisions of the stipulation, both the interpretation and the validity of the terms of the stipulation must be left for the mediator (see, Sisters of Saint John the Baptist, Providence Rest Convent v Phillip R. Geraghty Constructor, Inc., 67 NY2d 997; Matter of County of Rockland [Primiano Constr. Co.] 51 NY2d 1). Even where it is alleged that a stipulation itself, or certain provisions thereof, are invalid, void and unenforceable, the Court's role is confined to determining whether there is a valid mediation agreement. Once the Court sustains the mediation provisions of the stipulation, the validity and interpretation of the stipulation passes to the mediator (See, Matter of Freddie Prinze [ Jonas], 38 NY2d 570; Matter of Weinrott [Carp], 32 NY2d 190; see also, CPLR 7503[c]).

Here, the plaintiff has not challenged the viability of the mediation provisions of the stipulation, nor has she asserted that the subject matter of her claims falls outside the scope of issues the parties agreed to mediate. The stipulation contains a broad, general provision requiring that the parties seek mediation in the event "a dispute arises regarding some aspect of the agreement" (page 52). It specifically requires a party seeking modification of Article V (child support and "add-ons") to mediate prior to seeking judicial intervention (page 29).

Plaintiff's complaint asserts two causes of action seeking judgment "vacating" Article V of the stipulation. The Court finds that plaintiff was obligated to mediate said causes of action prior to commencing the above captioned plenary action.

Generally, the defendant's defenses to plaintiff's causes of action in the plenary action, including his defense of ratification, also fall within the purview of the mediator. The law is clear, however, that the issue of whether a claim sought to be mediated is barred by the statute of limitations, must be decided by the Court (see, Matter of Smith Barney Shearson v Sacharow, 91 NY2d 39; County of Nassau v Civil Service Empls Assn, 14 AD3d 509; Merrill Lynch Pierce Fenner & Smith v Benjamin, 1 AD3d 39 ).

Pursuant to CPLR 213(1), an action to rescind a stipulation settling a matrimonial action must be commenced within six years of the execution of the stipulation (see, Fade v Pugliani/Fade, 8 AD3d 612; Riley v Riley, 179 AD2d 750). The defendant contends that the plenary action herein is barred by the statute of limitations, as it was commenced six years and several days after the execution of the stipulation.

The Court finds, as a matter of law, that the execution of the "modification agreement" on February 17, 2000, unequivocally acknowledged the terms of the stipulation and [*8]"restarted" the applicable statute of limitations. Accordingly the defendant's motion for an order dismissing the complaint in the plenary action as time barred is denied.

With regard to plaintiff's application in the matrimonial action for an upward modification of child support, the stipulation clearly requires mediation prior to judicial intervention.

The stipulation, however, unequivocally permits resort to a court of competent jurisdiction to redress any default that remains uncured after 10 days written notice thereof. To the extent that plaintiff's order to show cause in the matrimonial action seeks a money judgment for arrears resulting from the defendant's alleged failure to pay child support, parochial school tuition, automobile, health, and telephone expenses, the plaintiff was not required to mediate this claim prior to seeking judicial relief. Further, to the extent that plaintiff's order to show cause in the matrimonial action alleges that the defendant has defaulted in his obligation to provide her with a replacement vehicle, she was not required to mediate said issue prior to seeking judicial intervention. In view of the parties' conflicting contentions and the various ambiguities in the stipulation referred to herein above, plaintiff's application for a money judgment for arrears and for an order directing the defendant to provide her with a new Plymouth minivan cannot be decided without a hearing.

Based upon all of the foregoing, it is hereby ordered that the parties will commence mediation of the issues asserted in the "first"and "second" causes of action in plaintiff's complaint in the plenary action, and her application for an upward modification in the matrimonial action, within 14 days of the date of this order. The mediator(s) shall be selected upon mutual agreement of the parties. The cost shall be advanced in the first instance by the defendant subject to allocation of the expense by the mediator.

In the event the parties are unable to resolve all issues through private mediation, they shall

appear for a conference in the matrimonial action and a preliminary conference in the plenary action on October 20, 2005 at 9:30a.m. Both parties shall produce net worth affidavits setting forth their financial circumstances as of February 2005 at the conference. Immediately following the conference, the parties shall attend mediation, at no charge, in the Nassau County Matrimonial Center through the auspices of the Association of Conflict Resolution and the Office of Court Administration Alternative Dispute Resolution program. In the event all issues are resolved through private mediation, prior to October 20, 2005, counsel shall so advise the Court by facsimile sent to (516) 571-0029.

All proceedings in both above captioned actions are stayed until October 20, 2005. Although the plaintiff's applications for a money judgment for arrears and for an order compelling the defendant to provide her with an automobile, are not subject to mediation, the adjudication of said issues prior to the completion of mediation would not serve the interests of justice and judicial economy. [*9]

The plaintiff's application for an order consolidating the above captioned actions is granted to the extent that both actions shall be joined for all purposes including discovery and trial/hearing.

This constitutes the decision and order of the Court.

E N T E R:

_________________________

Anthony J. Falanga, Justice

Supreme Court, Nassau County

Dated: September 8, 2005

Mineola, NY