JEFFREY K. JARVIS v. SANDRA L. JARVIS

 
(NOTE: The status of this decision is Published.)

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-1076-13T1

JEFFREY K. JARVIS,

Plaintiff-Appellant,

v.

SANDRA L. JARVIS,

Defendant-Respondent.

______________________________

May 14, 2015

 

Submitted April 14, 2015 Decided

Before Judges Koblitz, Haas and Higbee.

On appeal from Superior Court of New Jersey, Chancery Division, Family Part, Monmouth County, Docket No. FM-13-1271-10.

Keith, Winters & Wenning, attorneys for appellant (Brian D. Winters, on the brief).

Paras, Apy & Reiss, P.C., attorneys for respondent (Peter C. Paras, of counsel and on the brief).

PER CURIAM

Jeffrey K. Jarvis appeals from two provisions of September 26, 2013 orders. One disputed provision eliminated the biennial review of alimony and child support payments contained in the 110-page property settlement agreement (PSA) that he entered into with his former wife, Sandra L. Jarvis. The other disputed provision awarded Sandra $5254.88 in additional counsel fees.1 We reverse the elimination of the support review and affirm the award of counsel fees.

The parties were married in June 1984, had two daughters, and divorced in June 2010, after having entered into a lengthy PSA. At the time of the divorce, Jeffrey was the owner and president of four businesses, none of which had realized a profit for several years. Jeffrey was drawing a salary of $52,580. During their marriage, the parties' joint annual income of approximately $247,544 included Jeffrey's salary, $54,964 in interest and dividend income, and $140,000 in rental income from commercial property. Sandra was an unpaid administrative assistant and bookkeeper for Jeffrey's businesses.

In their PSA, the parties agreed to share residential custody of their two children. Jeffrey was to pay: $575 in monthly child support that would decrease to $432 per month when the older daughter became emancipated; 50% of the children's unreimbursed medical expenses in excess of $250; and $1889 to Sandra monthly for additional support in lieu of alimony.

The daughters had trust funds created by Sandra's family to pay for college costs. Jeffrey was to retain the marital residence and pay Sandra $325,000 for her share. Sandra, upon her relocation from the marital residence, was to remove an itemized list of her personalty. Jeffrey was to give Sandra a separate payment of $12,485, calculated as fifty percent of the difference between the estimated market value of the items retained by Jeffrey and those retained by Sandra.2

The PSA also contained biennial review provisions. Section 2.07, entitled "Periodic Review of Child Support Arrangements," stated that the parties were to exchange

proof of his/her respective year-end earned and unearned income from all sources for the immediately preceding calendar year, including but not limited to their W-2 forms (if applicable) and four most recent pay stubs . . . so that each can ascertain whether the income of the other increased or decreased to an extent warranting review of the child support arrangements hereinabove set forth.

Section 3.02 of the PSA, entitled "Periodic Review of Additional Support Arrangements," included the following handwritten and initialed provision: "[S]upport can be reviewed every two years commencing June 30, 2011, absent exigent circumstances." Future disputes were to be submitted "to mediation before embarking on litigation . . . ."

In August 2011, Jeffrey filed a motion seeking, among other things, a reduction in alimony3 and child support. He claimed that economic conditions led to reduced income. He further asserted that a reduction in child support was warranted because the older daughter attended college full time, where her living expenses as well as tuition were paid by her trust fund. He claimed that he gave the child a credit card for additional expenses, she stayed with a friend and had a part-time job.

Sandra filed a cross-motion seeking: payment of the $12,485 equitable distribution payment, plus interest for one year, per the PSA; maintenance of spousal support and child support payments to her as defined by the PSA; and "$3000 relief on legal fees for all future support reviews." In the certification accompanying the cross-motion, Sandra wrote: "I want to deter this costly and time consuming process from happening every two years as permitted in the original agreement." The parties were ordered to mediation to resolve their disputes, but the mediation that took place in early 2012 proved unsuccessful.

Subsequently, Sandra filed a motion to enforce litigant's rights. She again sought the $12,485 plus interest. She certified that as of the end of June 2012, Jeffrey had child support arrears of $1038 and alimony arrears of $5667. She sought back payments and interest and requested future support to be paid through the New Jersey Family Support Payment Center (the Center), pursuant to Rule 5:7-4(b). She sought reimbursement of uncovered medical bills for the children for 2010 and 2011. She further sought to eliminate the periodic review requirement designated in the PSA in favor of a "changed circumstances" analysis.4

Jeffrey filed a cross-motion which sought, among other things, to: suspend and modify alimony; modify child support; offset the $12,4855 owed "against the resulting credit for the alimony adjustment to be determined[;]" designate his home as the primary residence for their older daughter, who he claimed no longer lived on campus and resided with him full time; and continue "the review provisions of the judgment of divorce." A plenary hearing was scheduled.

In lieu of the hearing, however, the parties agreed to submit the matter to binding arbitration6 before a retired judge. Their April 2013 consent order for arbitration stated, in pertinent part: "In consideration of this arbitration agreement[,] parties waive any scheduled support reviews set forth in their [PSA]. No waiver of either parties' right to seek modification or termination in accordance with New Jersey law, including but not limited to Lepis and its progeny." The consent order further stated: "The [a]rbitrator will hear oral argument on the issues and be entitled to take any testimony she deems necessary from either party, with counsel to be entitled to cross examine on any issues the [a]rbitrator requires testimony on."

The arbitrator's written decision stated that no testimony was heard; rather, she "reviewed the extensive PSA along with the various motions, briefs, and supplemental materials provided" and heard oral argument of counsel. Sandra did not seek modification or correction of the arbitration award within forty-five days, as permitted by statute. N.J.S.A. 2A:23A-13(a). "The award of the umpire shall become final unless the action is commenced as required by this subsection." Ibid. Instead, on Sandra's motion,7 the arbitration decision was incorporated into an order dated June 11, 2013. This order was also signed by the arbitrator, who indicated that the order "comported" with her arbitration decision.

The arbitrator denied Jeffrey's cross-motion for modification of alimony and child support, which was memorialized by the court order. The arbitrator found that, although Jeffrey documented a decrease in business income, "without a forensic accountant analyzing what items billed through the business should be added back to determine [his] income," Jeffrey "failed to establish a prima facie case of changed circumstances." Thus the arbitrator, a retired family judge, determined that with expert analysis Jeffrey might prove reduced income. The arbitrator wrote: "At the time the PSA was entered, Jeffrey was not generating sufficient business income, yet he signed the agreement. Therefore, documentation presented in support of Jeffrey's cross-motion, leaves open the question of whether there has been a permanent change of circumstance."

The arbitrator stated: "With a closely held corporation, there are too many opportunities to hide income, thus requiring expert testimony." She stated that he "clearly used his business account to pay personal expenses[,]" such as legal fees, and that he could not elaborate on certain expenses, such as $37,000 of insurance premiums. The arbitrator found that Jeffrey had failed to meet his burden of proof, concluding that it was not possible to determine his actual income or "determine if there is a change of circumstance which is permanent." Her reasons for denying Jeffrey relief informed her decision to continue the biennial review.

The arbitrator did not eliminate the periodic review provisions "negotiated by the parties in the PSA[,]" stating: "It was clear at the time the PSA was entered, that Jeffrey's businesses were not earning a profit and those provisions were to permit Jeffrey to address on a regular basis substantial changes in circumstances." The order affirming the arbitration confirmed the retention of the biennial reviews.

The arbitrator designated that future child support and alimony payments were to be paid through the Center "[b]ecause Jeffrey failed to pay the required child support and alimony unilaterally." The order required Jeffrey to pay alimony arrearages dating from April 2012 through May 2013, of $24,557, as well as child support arrears of $5872 within fourteen days, with future payments to be made through the Center.

The arbitrator also found that Jeffrey owed Sandra $12,485, determining that the PSA did not tie Jeffrey's remittance of these funds to Sandra's removal of her personalty, as Jeffrey had argued. The June 11, 2013 order required Jeffrey to pay Sandra $12,485 within fourteen days.

The arbitrator further determined that Jeffrey owed Sandra $428.69 in unreimbursed medical expenses. The motion judge ordered Jeffrey to pay this sum within fourteen days.

Approximately one month later, Sandra filed a motion to enforce the June 13, 2013 order confirming the arbitration award. Sandra sought: payment of the monies owed to her per the June 11, 2013 order8; payment of new and previously ordered counsel fees; an arrest warrant for Jeffrey if payment was not forthcoming; and a receiver to sell Jeffrey's assets so that his obligation to Sandra could be met. Sandra's motion and her accompanying certification did not seek or mention elimination of the periodic review provision of the PSA. Sandra's certification stated: "I am not asking for anything more than we agreed to in our [PSA]." She wrote: "I want nothing more, but I will accept nothing less."

Jeffrey sought to set aside the June 11, 2013 order and have the court review support pursuant to Rule 4:50-1(f).9 Jeffrey asserted that he had hired an accountant to complete a cash flow analysis for 2010 to June 2013, and that he had taken steps to liquidate some of his assets to satisfy the $43,342.69 judgment. Sandra asserted that Jeffrey was no longer entitled to periodic reviews because they had waived that right in the April 11, 2013 consent order "in consideration" for binding arbitration. Sandra requested that the court appoint a receiver to sell Jeffrey's assets since he had not provided proof that he had taken steps to liquidate his assets.

On September 26, 2013, the judge granted Sandra's application to enforce litigant's rights. In a companion order, the judge denied Jeffrey's request for a further review of support "in accordance with the [s]ummary [b]inding [a]rbitration [d]ecision."

The "findings by the trial court are binding on appeal when supported by adequate, substantial, credible evidence." Cesare v. Cesare, 154 N.J. 394, 411-12 (1998). "[A]n appellate court should not disturb the 'factual findings and legal conclusions of the trial judge unless [it is] 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.'" Id. at 412 (quoting Rova Farms Resort, Inc. v. Investors Ins. Co. of Am., 65 N.J. 474, 484 (1974)). A reviewing court "will accord deference unless the trial court's findings 'went so wide of the mark that a mistake must have been made.'" N.J. Div. of Youth and Family Servs. v. M.M., 189 N.J. 261, 279 (2007) (quoting C.B.Snyder Realty, Inc. v. BMW of N. Am., Inc., 233 N.J. Super. 65, 69 (App. Div.), certif. denied, 117 N.J. 165, 564 (1989)). "A trial court's interpretation of the law and the legal consequences that flow from established facts are not entitled to any special deference." Manalapan Realty, L.P. v. Manalapan Twp. Comm., 140 N.J. 366, 378 (1995).

We first review the statutes governing arbitration procedures.

The Alternative Procedure for Dispute Resolution Act (APDRA), N.J.S.A. 2A:23A-1 to -30, is a voluntary procedure for alternative dispute resolution, which becomes operable upon voluntary agreement by the parties. Parties who enter into an agreement under the APDRA waive their right to . . . appeal except as provided by section 13 of the act.

 
[Weinstock v. Weinstock, 377 N.J. Super. 182, 188 (App. Div. 2005)].

N.J.S.A. 2A:23A-13(a) states, in pertinent part: "A party to an alternative resolution proceeding shall commence a summary application in the Superior Court for its vacation, modification or correction within [forty-five] days after the award is delivered to the applicant . . . ." "In considering an application for vacation, modification or correction, a decision of the umpire on the facts shall be final if there is substantial evidence to support that decision[.]" N.J.S.A. 2A:23A-13(b).

The award shall be vacated on the application of a party who either participated in the alternative resolution proceeding or was served with a notice of intention to have alternative resolution if the court finds that the rights of that party were prejudiced by

(1) Corruption, fraud or misconduct in procuring the award;

(2) Partiality of an umpire appointed as a neutral;

(3) In making the award, the umpire's exceeding their power or so imperfectly executing that power that a final and definite award was not made;

(4) Failure to follow the procedures set forth in this act, unless the party applying to vacate the award continued with the proceeding with notice of the defect and without objection; or

(5) The umpire's committing prejudicial error by erroneously applying law to the issues and facts presented for alternative resolution.

[N.J.S.A. 2A:23A-13(c). (emphasis added).]

"[O]nly those issues may be arbitrated which the parties have agreed shall be.'" Fawzy v. Fawzy, 199 N.J. 456, 469 (2009) (quoting In re Arbitration Between Grover & Universal Underwriters Ins. Co., 80 N.J. 221, 228-29 (1979)).

The consent order stated that "in consideration of this arbitration agreement" the parties waived "any scheduled support reviews set forth in their [PSA]." At the time of arbitration in April 2013, the parties were approximately two months away from the second PSA-authorized review of child support and alimony, which could occur in June 2013. Sandra asserts that the consent order eliminated the periodic review provision and thus "[t]he arbitrator had no authority to address the issue."

Depending on how the consent order waiver was interpreted, Sandra might have had grounds to vacate the arbitration decision, pursuant to N.J.S.A. 2A:23A-13(c)(3), on the basis that the arbitrator exceeded her power. Instead, as allowed by N.J.S.A. 2A:23A-12(f), Sandra applied to have the arbitration decision, in its totality, confirmed. In the June 2013 order, the motion judge granted Sandra the relief she requested, confirming the entire arbitration decision including the continuation of the biennial reviews. We therefore reverse the portion of the September 26, 2013 order that discontinues the biennial review of support called for in the parties' PSA and confirmed in the June 11, 2013 order.

One of the September 26, 2013 orders granted Sandra $5254.88 in counsel fees. In her oral decision accompanying the order, the motion judge stated: "[I]f by enforcing her support obligations, [Sandra] has to expend counsel fees in order to maintain her support obligations, she has to be made whole by the award of counsel fees . . . ."

"[T]he award of counsel fees and costs in matrimonial action rests in the discretion of the court." Williams v. Williams, 59 N.J. 229, 233 (1971) (citations omitted); Rule 5:3-5(c). "[I]n awarding counsel fees, the court must consider whether the party requesting the fees is in financial need; whether the party against whom the fees are sought has the ability to pay; the good or bad faith of either party in pursuing or defending the action; the nature and extent of the services rendered; and the reasonableness of the fees. Mani v. Mani, 183 N.J. 70, 94-95 (2005) (citing Williams, supra, 59 N.J. at 233). We affirm the exercise of the sound discretion of the motion judge in awarding Sandra reasonable counsel fees towards her efforts to collect support owed to her.

We reverse only that portion of the order that discontinues the biennial review of support called for in the parties' PSA.

Affirmed in part and reversed in part. We do not retain jurisdiction.

1 We will call the parties by their first names for ease of reference, intending no disrespect.

2 Jeffrey was also to pay Sandra an additional $411,923, calculated as the net difference between the credits to each party from their respective retention of assets including bank accounts, investment accounts, the commercial property, the marital home, cars and boats.

3 Although the PSA refers to payments to Sandra as "additional support," subsequent documents refer to these payments as alimony.

4 "The party seeking modification has the burden of showing . . . 'changed circumstances' as would warrant relief from the support or maintenance provisions involved. A prima facie showing of changed circumstances must be made before a court will order discovery of an ex-spouse's financial status."
Lepis v. Lepis, 83 N.J. 139, 157 (1980) (internal citation omitted).

5 Jeffrey's motion stated that the amount due was $12,045.

6 The consent order stated that the arbitrator's decision "shall be final and binding upon both parties and shall not be appealable, except as explicitly permitted by N.J.S.A. 2A:23[A]-1 et seq."

7 "The court shall confirm an award upon application of a party made within one year after its delivery to him, unless the award is vacated or modified upon a ground specified in section 13 of this act." N.J.S.A. 2A:23A-12(f).

8 Sandra was to receive $43,342.69 per the June 11, 2013 order: $12,485 in equitable distribution; plus $5872 in child support arrears; plus $24,557 in alimony arrears; plus $428.69 for unreimbursed medical expenses.

9 Rule 4:50-1(f) states, in pertinent part: "On motion, with briefs, and upon such terms as are just, the court may relieve a party or the party's legal representative from a final judgment or order for . . . (f) any other reason justifying relief from the operation of the judgment or order."