FRANCINE M. KRENICKI v. GEORGE KRENICKI

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

 

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-0

FRANCINE M. KRENICKI,

Plaintiff-Respondent,

v.

GEORGE KRENICKI,

Defendant-Appellant.

________________________________________

February 25, 2014

 

 

Before Judges St. John and Leone.

 

On appeal from Superior Court of New Jersey, Chancery Division, Family Part, Bergen County, Docket No. FM-02-1829-06.

 

Patrick T. Collins argued the cause for appellant (Franzblau Dratch, attorneys; Mr. Collins, on the briefs).

 

Barry L. Kaufman argued the cause for respondent (Schiffman, Abraham, Kaufman & Ritter, P.C., attorneys; Mr. Kaufman, of counsel and on the brief; Lauren K. Vodopia, on the brief).

 

PER CURIAM
 

Defendant George Krenicki (George)1 appeals from two post-judgment orders in this divorce proceeding. He challenges part of a June 28, 2012 order restraining him from allowing unsupervised contact between his girlfriend and the two children born of the marriage. George also appeals from a September 11, 2012 order modifying his unallocated child support obligation without incorporating the cost of the children's health insurance premiums and requiring him to reimburse plaintiff, Francine Krenicki (Francine), for certain au pair expenses. For the reasons that follow, we reverse and remand.

I.

George and Francine were married in September 1996 and divorced in 2007. They have two daughters, for whom Francine is the primary caretaker. The parties' final judgment of divorce incorporated a "Support and Property Settlement Agreement" (the PSA) under which George was obligated to provide various forms of support. In the provisions relevant to this appeal, George agreed to: (1) pay limited-duration alimony to Francine in the amount of $18,750 per year for four years; (2) pay $152 per week in unallocated child support, which amount had been calculated using the Child Support Guidelines (CSG or Guidelines) worksheet; (3) maintain health-insurance coverage for the children through his employer-provided plan; and (4) reimburse Francine, upon proof of payment, sixty percent of the costs paid to the au pair "for work related child care expenses." At the time of the agreement, as memorialized in the PSA, Francine and George were earning $100,000 and $165,000 per year respectively.

By letter dated June 23, 2011, just before her alimony was set to expire, Francine proposed an increase in George's unallocated child support to $425 per week. Further, she sought an additional $1,532.83 per month for "network related child care expenses," which represented sixty-seven percent of au pair-related expenses, including salary, automobile costs, cell phone and boarding.

In late September 2011, George was terminated from his job with an investment firm. Consequently, to maintain the children on his medical insurance plan would require George to pay $502 in monthly COBRA premiums.

The litigation concerning the present dispute was commenced on October 12, 2011, by Francine's application for an order to show cause arising from a dispute between the parties concerning the children's passports, which ultimately became moot and is irrelevant to the issues on appeal. On October 21, 2011, George cross-moved for an order compelling plaintiff to enroll the children on her employer-provided healthcare plan.

Also on October 21, Francine filed a separate motion for modification of the PSA to (1) increase the unallocated child support to $425 per week; (2) raise George's obligation to sixty-seven percent of the children's health-insurance expenses and the au pair's salary; and (3) require George to pay sixty-seven percent of Francine's prospective non-salary expenses for the au pair. Francine also sought $10,000 from George as reimbursement for his share of Francine's non-salary expenses for the au pair incurred from 2007 to 2011. She certified that expiration of her limited duration alimony in July 2011 created a "change of circumstances by reducing my overall available funds."

George then cross-moved on December 1, asking the court to modify the child support, medical and childcare obligations based on the parties' respective incomes. George also repeated his request for an order requiring Francine to enroll the children on her employer-provided insurance plan. Moreover, George asserted that he was not required under the PSA to reimburse Francine for the non-salary expenses for the au pair, noting that Francine had never requested such remuneration until termination of her limited-duration alimony.

On January 6, 2012, the Family Part judge entered an order establishing temporary support payments, providing for mutual exchange of financial information, and scheduling a plenary hearing in April for a resolution of the issues raised by the parties. On January 19, 2012, the judge ordered Francine to enroll the children on her employer-provided health insurance plan. On April 12, 2012, the plenary hearing was rescheduled for June 28 and the discovery deadlines extended. Sometime thereafter, Francine either left or was terminated from her employment.

On May 30, 2012, as these proceedings were pending, George applied for an order to show cause requiring Francine to cease cohabitating with her purported boyfriend, D.C.2 George certified that he had retained a private investigator, who subsequently discovered that D.C. had been charged with, and served jail sentences for, several drug-related offenses.

In response, Francine certified that she did not have a "live-in boyfriend" and submitted certifications from D.C., who acknowledged a history of drug addiction and related legal problems but claimed that he was long-since rehabilitated. The judge ordered a social investigation by the Bergen County Probation Department and placed temporary restraints on Francine, prohibiting unsupervised contact between D.C. and the children.

On June 28, 2012, in lieu of the scheduled plenary hearing, the judge heard oral argument on George's order to show cause. George sought permanent restraints since D.C.'s record reflected five drug-related arrests and seven driving while intoxicated charges, two of which occurred after his purported rehabilitation.

The judge concluded that D.C. had "significant substance abuse issues" and therefore proscribed Francine from allowing D.C. to drive the parties' children or be alone with them. The judge then inquired if George was "still seeing" his girlfriend, S.S. After George confirmed that he was, the judge placed identical restraints on George with respect to S.S., explaining:

I'm going to be fair. She's not going to drive the children either, and she's not going to be alone with them because I'm going to be fair to both of you. You want to micro manage, I'm going to micro manage.

 

. . . .

 

[S.S.] will not drive the children, either. What's fair is fair. I don't have any information on her. I didn't order a report on her, but I'm concerned for these children so I have to be even-handed and fair.

 

An order memorializing the judge's decision was filed on June 28. Additionally, the judge determined, upon agreement of the parties, that a plenary hearing was no longer required for adjudication of the disputed issues. A second amended order was entered scheduling oral argument for August 3 and giving the parties the option to submit additional certifications beforehand.

On July 23, 2012, Francine filed a certification and accompanying exhibits pursuant to the second amended order. At the outset, Francine asserted that her circumstances had changed because her current employment was set to terminate in August 2012. She explained her intention to work as a part-time consultant thereafter, which she anticipated would bring in approximately $105,000 per year. Francine asked the court to impute to George an income of $175,290 per year as a "financial manager," derived from the New Jersey Department of Labor Employment Statistics Manual (the "NJDOLES Manual").

Moreover, Francine contended that since the terms of the PSA ultimately required George to pay the cost of the children's health insurance coverage, the court should order him to pay the $955.01 monthly cost of her COBRA coverage. And while Francine acknowledged that she no longer employed an au pair, she now sought $13,000 for past non-salary expenses.

George replied by letter to the court dated July 25, 2012. First, he proposed that the court deem the parties' incomes in parity at approximately $105,000. Second, George asked the court to modify the PSA for an equal allocation of the health insurance costs, asserting that the loss of employer-provided coverage by both parties constituted changed circumstances. Finally, he argued that the clear language of the PSA did not require him to pay Francine's non-salary expenses for the au pair.

After hearing oral argument from the parties, the judge rendered her decision on September 11, 2012. With respect to Francine's past non-salary expenses for the au pair, the judge determined that it was "reasonable" for George to reimburse Francine $13,000 for his share of those necessary expenses:

[T]he Court must consider what the au pair does. The au pair transports children to and from school, their activities, perhaps their doctor appointments and concomitant with that and for the safety health and welfare benefits of the children that includes a cell phone. It must be in the event of an emergency. It has to include an automobile. How else is the au pair going to get around? Gas, leased costs, room and board . . . .

 

Accordingly, the judge ordered George to pay the $13,000 that Francine was seeking.

On the issue of health insurance coverage for the children, the judge concluded that the PSA "is very clear" in requiring George to cover the costs, and therefore ordered him to reimburse Francine for her monthly COBRA premiums.

Finally, regarding Francine's motion for modification of George's weekly child support obligation, the judge found changed circumstances in that Francine lost her employment and "just by the passage of time in this case." In terms of George's unemployment status, the judge stated:

[I]t's significant to this Court that [George] has not worked in about a year, yet, he's been able to maintain an investment account with a substantial value of $150,400 and saliently [George] has not liquidated any of his accounts to meet his expenses while he is unemployed. The Court has placed great weight and finds that to be a fact that was not refuted.

 

The judge then imputed income to both parties based on the NJDOLES Manual. Turning first to Francine, the judge concluded that she would be deliberately underemployed as a part-time consultant, and thus imputed to her the income of a full-time purchasing manager at $135,700. With respect to George, the judge determined:

I am imputing income to him in the amount of $164,970 per year, which is the closest to what he earned in 2007. I'm not using his high-mark years either, I don't think that's fair to him because I don't think that's realistic in today's economy. And that amount reflects the mean salary of a financial manager in the Northern New Jersey region. I've considered his background, his history of making over $200,000 and his skills.

 

Accordingly, after entering those imputed incomes into the standard CSG worksheet, George's unallocated child support obligation was increased to $203 per week. A written order was entered on the same day memorializing the judge's decision.

George appeals from that order, as well as the June 28, 2012 order limiting S.S.'s contact with the children.

II.

George contends that the PSA does not support the motion judge's order requiring him to reimburse $13,000 in room and board, automobile and cell phone expenses associated with the au pair. We agree.

Family Part judges have special jurisdiction and expertise in family matters, and we therefore accord substantial deference to their factual findings and discretionary decisions. Cesare v. Cesare, 154 N.J. 394, 413 (1998). However, "a question regarding the interpretation or construction of a contract is a legal one and our review is plenary, with no special deference to the trial judge's interpretation of the law and the legal consequences that flow from the established facts." Barr v. Barr, 418 N.J. Super. 18, 31 (App. Div. 2011); see also Massar v. Massar, 279 N.J. Super. 89, 93 (App. Div. 1995)(noting that "the contractual nature" of marital settlement agreements "has long been recognized"). Although we apply principles of equity to assure that a matrimonial settlement agreement is fair and just, see, e.g., Petersen v. Petersen, 85 N.J. 638, 642 (1981), we apply contract principles to ascertain an agreement's meaning. See Pacifico v. Pacifico, 190 N.J. 258, 266 (2007).

Our State "has long espoused a policy favoring the use of consensual agreements to resolve marital controversies" and strongly approves the enforcement of marital agreements. Konzelman v. Konzelman, 158 N.J. 185, 193 (1999); Massar, supra, 279 N.J. Super. at 93. Such agreements, where voluntary and consensual, are "'entitled to considerable weight with respect to their validity and enforceability' in equity, provided they are fair and just." Dolce v. Dolce, 383 N.J. Super. 11, 20 (App. Div. 2006)(quoting Petersen, supra, 85 N.J. at 642). Where "the parties and their attorneys have bargained at arm's length and there is no showing of unfairness, the trial court should not supply terms which the parties obviously considered and yet did not adopt." Berkowitz v. Berkowitz, 55 N.J. 564, 569 (1970).

"[I]t is a basic rule of contractual interpretation that a court must discern and implement the common intention of the parties." Pacifico, supra, 190 N.J. at 266; see also Celanese Ltd. v. Essex Cnty. Imp. Authority, 404 N.J. Super. 514, 528 (App. Div. 2009). If the meaning of the agreement is in dispute, "[t]he court's role is to consider what is written in the context of the circumstances at the time of drafting and to apply a rational meaning in keeping with the 'expressed general purpose.'" Ibid. (quoting Atl. N. Airlines, Inc. v. Schwimmer, 12 N.J. 293, 302 (1953)). The intention of the parties in entering into a PSA may be demonstrated by their "course of conduct in following its terms over an extended period." Savarese v. Corcoran, 311 N.J. Super. 240, 248 (Ch. Div. 1997), aff'd o.b., 311 N.J. Super. 240 (App. Div. 1998). In interpreting a PSA, we may not "supply terms to contracts that are plain and unambiguous" or "make a better contract for either of the parties than the one which the parties themselves have created." Barr, supra, 418 N.J. Super. at 31-32.

With these principles in mind, we turn to the inquiry at hand. Neither Francine nor George disputes that the PSA governs the issue. Indeed, the plain language of Francine's application demonstrates that she was seeking reimbursement of the au pair expenses under the terms of the existing PSA. The motion judge decided that it was "reasonable" for George to bear a portion of those costs, but her assessment failed to give any weight to the PSA. While incorporation of a marital settlement agreement into a divorce decree "does not render it immutable, nor its terms solely governed by contract law, nevertheless, if found to be fair and just, it is specifically enforceable in equity." Eaton v. Grau, 368 N.J. Super. 215, 224 (App. Div. 2004)(citations omitted).

Section 4.6 of the PSA, which addresses work-related child-care expenses, provides in pertinent part:

The WIFE presently employs a nanny/au pa[ir] at a cost of $140.00 per week. The WIFE also pays the present nanny/au pa[ir] $5.00 per hour overtime. Each month the WIFE shall provide proof of the amount paid to the nanny/au pa[ir] and HUSBAND shall pay to the WIFE within five (5) days sixty (60%) percent of the amount paid by WIFE to the nanny/au pa[ir] for work related child care expenses.

 

Given the plain language of the provision and the surrounding circumstances, we conclude that Section 4.6 of the PSA only requires George to pay sixty-percent of the au pair's compensation. First, the initial two sentences specifically delineate what constitutes "work related child care expenses," namely the regular and overtime salary costs of employing the au pair. Second, the provision twice states that George must reimburse Francine for amounts "paid to" the au pair. (Emphasis added). The choice of those specific words reinforces our conclusion that the parties intended for George to pay only the salary costs because automobile, phone and lodging costs are not "paid to" the au pair. Finally, the fact that Francine never sought reimbursement for these additional expenses over the course of four years convinces us that she shared the same understanding of Section 4.6. Our review of the entire PSA reveals that it is a carefully-worded and integrated document, bargained at arm's length by the parties in consultation with independent counsel, and thus it is specifically enforceable in equity. See Berkowitz, supra, 55 N.J. at 569. Accordingly, we determine that Francine is not entitled to reimbursement of her non-salary expenses for the au pair under the terms of the PSA. Therefore, we reverse and vacate that portion of the order awarding Francine $13,000.

George also argues that the motion judge erred by neglecting to credit him, in the CSG worksheet appended to her order, for the cost of maintaining the children's health insurance.

Rule 5:6A provides that the Guidelines are mandatory when considering a motion to fix or modify child support, unless "good cause is shown" for departure from them. See also Pressler & Verniero, Current N.J. Court Rules, comment 1.1 on R. 5:6A (2013); Italiano v. Rudkin, 294 N.J. Super. 502, 506 (App. Div. 1996). While a court may, within its sound discretion, modify or disregard the Guidelines for good cause, it must state the reasons for doing so in the CSG worksheet. R. 5:6A; Pressler & Verniero, supra, Appendix IX to R. 5:6A at 2579-90, 2599-2600; Ordukaya v. Brown, 357 N.J. Super. 231, 239 (App. Div. 2003). Thus, absent good cause, a completed CSG worksheet, "in the form prescribed in Appendix IX," must be filed alongside any order or judgment that includes child support. R. 5:6A.

Appendix IX provides that "[s]ince the cost of health insurance is excluded from the child support schedules, a parent's contributions to a health insurance policy which includes the child for whom support is being determined must be added to the basic support award." Pressler & Verniero, supra, Appendix IX to R. 5:6A at 2635. Accordingly, the "marginal cost of adding a child to a health insurance policy shall be added to the basic child support award and deducted from the paying parent's income share of the total child support award." Id. at 2600 (citation omitted). To compute that marginal cost, the weekly cost of the children's health insurance must be entered into the CSG worksheet as a combined supplemental expense. Id. at 2635. The paying parent is then credited in the support calculation for his or her percentage share of those costs. Id. at 2637, 2644-48.

Here, the motion judge ordered George to pay for the children's COBRA coverage pursuant to the PSA and also modified his unallocated child support from $152 to $203 per week, utilizing the CSG worksheet in computing the award. However, the judge's worksheet omitted to credit George for the marginal cost of providing COBRA insurance. Since the judge did not make express findings of good cause for such deviation from the Guidelines,3 we are constrained to reverse. We remand the matter to the Family Part for a recalculation of George's unallocated child support, which must incorporate the cost of the COBRA premiums into the CSG worksheet in conformity with Rule 5:6A and the Guidelines.

We turn next to George's argument that the order restraining him from allowing unsupervised contact between his girlfriend, S.S., and the children should be reversed because it was not based on any findings of fact.

Family Part determinations concerning the welfare of children are particularly difficult and highly discretionary. Abouzahr v. Matera-Abouzahr, 361 N.J. Super. 135, 157 (App. Div.), certif. denied, 178 N.J. 34 (2003). Generally, "the special jurisdiction and expertise of the family court requires that we defer to factual determinations if they are supported by adequate, substantial, and credible evidence in the record." Milne v. Goldenberg, 428 N.J. Super. 184, 197 (App. Div. 2012). Such deference will be "disturbed only upon a showing that the findings are 'manifestly unsupported by or inconsistent with the competent, relevant and reasonably credible evidence' to ensure there is no denial of justice." Ibid. (internal quotation marks omitted)(quoting Platt v. Platt, 384 N.J. Super. 418, 425 (App. Div. 2006)).

Here, the motion judge acknowledged that she possessed no information about S.S., but nevertheless ordered the restraints to appear "even-handed and fair." While we recognize that "[t]here are obviously few judicial tasks which involve the application of greater sensitivity, delicacy and discretion than the adjudication of child custody disputes," Fehnel v. Fehnel, 186 N.J. Super.209, 215 (App. Div. 1982), the judge's order was unsupported by competent evidence and must be reversed. Cesare, supra, 154 N.J.at 412. Therefore, we vacate that portion of the June 28, 2012 order concerning S.S.

Finally, we note that, at oral argument, George withdrew his contention that the motion judge arbitrarily imputed to him an income of $164,970. Accordingly, on remand the Family Part judge may use the incomes previously imputed to both George and Francine in recalculating the unallocated child support award.

In conclusion, we reverse and vacate that aspect of the June 28, 2012 order restraining unsupervised contact between the children and S.S. With respect to the order of September 11, 2012, (1) we reverse and vacate that portion of the order requiring George to reimburse Francine $13,000 for her non-salary expenses for the au pair; and (2) we reverse the award of unallocated child support and remand for a recalculation which incorporates into the CSG worksheet the health insurance costs borne by George. We do not retain jurisdiction.

1 For ease of reference we refer to the parties by their first names.

2 In order to respect the privacy of the boyfriend and girlfriend named herein, we use initials.

3 In fact, the motion judge notated in the comments section of her CSG worksheet that the modification was based on the Guidelines. Thus, it appears to us that omission of the health insurance cost was merely an oversight. If we are mistaken in that conclusion, however, on remand the judge must make express findings as to good cause for her deviation from the Guidelines. See Winterberg v. Lupo, 300 N.J. Super. 125, 132 (App. Div. 1997).