PATRICIA ZUBA v. BERNARD ZUBA

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-0

PATRICIA ZUBA

n/k/a PATRICIA HUGHES,

Plaintiff-Appellant,

v.

BERNARD ZUBA,

Defendant-Respondent.

April 14, 2015

Submitted March 25, 2015 Decided

Before Judges Alvarez and Carroll.

On appeal from the Superior Court of New Jersey, Chancery Division, Family Part, Ocean County, Docket No. FM-15-378-11.

Maggs & McDermott, LLC, attorneys for appellant (Tennant D. Magee, Sr., on the brief).

Agnes Rybar attorney for respondent.

PER CURIAM

Plaintiff Patricia Hughes appeals the Family Part's denial of her motion to reopen her Final Judgment of Divorce (FJOD). Plaintiff's motion was based on her receipt of information that her ex-husband, defendant Bernard Zuba, had purchased property in Costa Rica and had a bank account in Belize that he concealed

from her during the parties' marriage and divorce proceedings. Because we conclude that the Family Part judge denied plaintiff's motion prematurely, we vacate the November 8, 2013 order and remand the matter for discovery and further proceedings as necessary.

I.

The parties were married in July 1980, and divorced on January 4, 2011. Article 2.12 of the parties' December 8, 2010 property settlement agreement (PSA) that was incorporated into the FJOD provided: "The parties represent that each of them has candidly and fully disclosed to the other all of their income, assets and liabilities as of the execution of this Agreement."

For some period following the divorce, defendant resided in the home of Ms. Grinfelds. During this time period, defendant allegedly disclosed to Grinfelds and other members of her family that he owned property in Costa Rica and had a bank account in Belize that he did not disclose on the Case Information Statement (CIS) that he filed during his divorce proceedings. Grinfelds claimed that she did not have proof that defendant actually concealed these assets until 2012. After defendant left Grinfelds's home in November 2012, Grinfelds contacted plaintiff the following month and advised her that defendant had hidden money and property during their marriage.

In September 2013, plaintiff filed a motion seeking to set aside the PSA. Plaintiff cited defendant's oral and written representations that the marital property listed in the PSA and defendant's CIS constituted the parties' entire marital property. Plaintiff certified that it was not until December 2012 or January 2013 that she "learned for the very first time that [d]efendant purchased property in Costa Rica and wired substantial funds to a Belize bank account during my marriage to him." Plaintiff requested a period of discovery followed by a plenary hearing on her application, and an award of attorney's fees.

Grinfelds submitted an affidavit supporting plaintiff's motion. Notably, Grinfelds averred as follows

17. During the time [defendant] stayed at my house, he further advised [my son] Max, [my son's father] Paul, and I on a number of occasions that he had purchased the Costa Rican property during his marriage with [plaintiff]. Specifically, [defendant] advised me that he had paid $65,000[] for the Costa Rican property during his marriage with [plaintiff] and that [plaintiff] did not know that he had purchased that property or owned that property.

18. In addition, during his time at my house, [defendant] also advised me that he had a savings account in Belize with substantial sums of money that he created during his marriage . . . and that [plaintiff] did not know that he had that bank account. [Defendant] told me that he wired the money from the United States to the Belize savings account during his marriage . . . .

19. In fact, [defendant] advised me on a number of occasions while staying at my house that he was concerned [plaintiff] would hire a private investigator who would discover . . . that he was hiding property and money from her during their marriage and during their divorce. As a result, [defendant's] plans were that he was going to wait five [] years from the date his divorce from [plaintiff] was final to sell the Costa Rican [p]roperty and bring his money back to the United States from Belize.

20. [Defendant], however, did not wait five [] years, and, at some point in time in 2012, [defendant] told me that he sold the Costa Rican property for over $100,000[] and realized approximately $87,000[] net after costs and fees. At or about that time, [defendant] also told me that he had wired the money back from the Belize savings account into the United States. . . .

21. Of course, until 2012, I did not have any concrete proof of [defendant's] claims regarding the Costa Rican property and Belize bank account. They could have been wild, false claims. However, during 2012 [defendant] showed me paperwork (though I never asked to see any) demonstrating proof of their existence. Specifically, he showed me paperwork demonstrating that he paid $65,000[] for the Costa Rican property, sold it for approximately $100,000[], and after capital gains, taxes, etc., that he walked away with an approximate net of $87,000[] sometime during the spring of 2012. Later, when [defendant] was moving out of my house in 2012, I found a copy of a personal online banking application for Belize Bank on the mirror of his room in my house with an account number and the amount of $107,644[].1

Defendant opposed plaintiff's motion. He certified that the allegations were false and that Grinfelds lacked credibility, themes that he reiterated at oral argument.

In a bench ruling supplemented by a written statement of reasons, the Family Part judge denied the motion on the basis that plaintiff failed to establish a prima facie case of fraud. The judge recognized the parties' "conflicting" and "competing" versions of events, but stated that she was unable to "make a determination about . . . whether there's a factual dispute."

After receiving defendant's notice of appeal, the judge issued an opinion, see R. 2:5-1(b), amplifying the basis for her conclusion that plaintiff failed to meet the burden necessary to grant relief under Rule 4:50-1. The judge reasoned

Here, the proofs are speculative and inconsistent. The only proofs are Ms. Grinfelds'[s] recounting of various conversations in which she claimed [d]efendant wanted to leave the country, and had indicated, according to her that he had property prior to the marriage, which he sold. Ms. Grinfelds did not identify the "documents" that she purportedly saw, demonstrating a yield of $87,000 to [d]efendant in the [s]pring of 2012. The blank application for the Belize Bank had no identifying information within it, tying it to [d]efendant. Such proofs do not rise to clear and convincing proof of concealment by [d]efendant.

Plaintiff appeals, arguing that, at a minimum, she was entitled to an opportunity for post-judgment discovery and a potential plenary hearing following such discovery on her application to have the FJOD vacated under Rule 4:50-1.

II.

"We commence our analysis by noting New Jersey's strong public policy in favor of the settlement of litigation." Gere v. Louis, 209 N.J.486, 500 (2012); see alsoCont'l Ins. Co. v. Honeywell Int'l, Inc., 406 N.J. Super. 156, 194-95 n.31 (App. Div. 2009). "'[T]he settlement of litigation ranks high in our public policy.'" Brundage v. Estate of Carambio, 195 N.J.575, 601 (2008) (quoting Jannarone v. W.T. Co., 65 N.J. Super. 472, 476 (App. Div.), certif. denied, 35 N.J.61 (1961)). "This policy rests on the recognition that parties to a dispute are in the best position to determine how to resolve a contested matter in a way which is least disadvantageous to everyone." Gere, supra, 209 N.J.at 500 (citations and internal quotation marks omitted).

We particularly note that "[a]dvancing that public policy [of fostering the settlement of disputed claims] is imperative in the family courts where matrimonial proceedings have increasingly overwhelmed the docket. . . . This practice preserves the right of competent, informed citizens to resolve their own disputes in whatever way may suit them." Ibid.(alterations in original) (citations and internal quotation marks omitted).

We further recognize that motions to set aside final judgments under Rule 4:50-1 are only to be granted "sparingly." Pressler & Verniero, Current N.J. Court Rules, comment 1 on R. 4:50-1 (2015). Nevertheless, the Rule does allow for relief where the facts and equities compel it, particularly in contexts involving the equitable distribution of marital assets. "The equitable authority of courts to modify property settlement agreements executed in connection with divorce proceedings is well established. . . . The agreement must reflect the strong public and statutory purpose of ensuring fairness and equity in the dissolution of marriages." Miller v. Miller, 160 N.J. 408, 418 (1999).

"[A]pplications for relief from equitable distribution provisions contained in a judgment of divorce are subject to [Rule 4:50-1] and not, as in the case of alimony, support, custody, and other matters of continuing jurisdiction of the court, subject to a 'changed circumstances' standard." Eaton v. Grau, 368 N.J. Super. 215, 222 (App. Div. 2004) (second alteration in original) (quoting Pressler, Current N.J. Court Rules, comment 1.7 on R. 4:50-1 (2004) (citing Miller, supra, 160 N.J. at 418)).

Because plaintiff's motion was filed more than one year after the January 4, 2011 FJOD, it falls within the catch-all provision of Rule 4:50-1(f) and must be founded upon a showing of inequity and unfairness. See Rosen v. Rosen, 225 N.J. Super. 33, 36 (App. Div.), certif. denied, 111 N.J. 649 (1988). Rule 4:50-1(f) provides that a court may vacate a judgment for "any other reason justifying relief from the operation of the judgment or order." When considering this basis for relief,

[n]o categorization can be made of the situations which would warrant redress under subsection (f). . . . [T]he very essence of (f) is its capacity for relief in exceptional situations. And in such exceptional cases its boundaries are as expansive as the need to achieve equity and justice.

[Court Inv. Co. v. Perillo, 48 N.J. 334, 341 (1966); see also Hous. Auth. of Morristown v. Little, 135 N.J. 274, 286 (1994).]

We have previously observed that "where there is a showing of fraud or misconduct by a spouse in failing to disclose the true worth of his or her assets, relief may be granted under R[ule]4:50-1(f) if the motion is made within a reasonable time." Rosen, supra, 225 N.J. Super.at 37; see alsoVon Pein v. Von Pein, 268 N.J. Super.7, 17 (App. Div. 1993) (reversing an equitable distribution award because the husband had falsely stated that he was unemployed at the time of the divorce when he was actually earning a substantial income). The question of what is a reasonable time necessarily depends on the specific circumstances of each case. Pressler & Verniero, Current N.J. Court Rules, comment 3 on R.4:50-2 (2015).

III.

With these principles in mind, we conclude that this appeal does not require us to resolve the merits of plaintiff's motion to vacate her divorce judgment. Rather, we need only determine the threshold question of whether the record sufficiently raises genuine issues that warrant discovery and, depending on what that discovery reveals, a potential plenary hearing on plaintiff's motion.

If Grinfelds's allegations prove credible, they provide support for plaintiff's claim that defendant had boasted after the divorce about hiding assets during the parties' marriage. Such boasts, if proven, may amount to declarations against interest which are properly admissible against defendant under N.J.R.E. 803(c)(25). Defendant denied Grinfelds's accusations. As the motion judge correctly recognized, their "competing" affidavits were "conflicting." However, it is well-established that "a court may not make credibility determinations or resolve genuine factual issues based on conflicting affidavits." K.A.F. v. D.L.M., 437 N.J. Super. 123, 137-38 (App. Div. 2014).

In her supplemental written opinion, the judge reasoned that plaintiff's proofs "do not rise to clear and convincing proof of concealment by [d]efendant." In reaching that conclusion, the judge noted that Grinfelds "did not identify the 'documents' that she purportedly saw," and that "[t]he blank application for the Belize Bank had no identifying information within it, tying it to [d]efendant." However, plaintiff provided what information she could obtain. If indeed defendant possessed other documentation that he showed to Grinfelds but concealed from plaintiff, we conclude that "'it would be unreasonable to place the burden of proof on a party not having access to the evidence necessary to support that burden of proof.'" Ozolins v. Ozolins, 308 N.J. Super. 243, 249 (App. Div. 1998) (quoting Frantz v. Frantz, 256 N.J. Super. 90, 93 (Ch. Div. 1992)). Moreover, in this case the assets were allegedly concealed in Costa Rica and Belize, thus complicating plaintiff's ability to independently verify their existence and access documentation pertaining to them.

Given the factual disputes, and plaintiff's lack of opportunity to fully develop her claim that defendant intentionally concealed significant marital assets, to her detriment, we deem it prudent to vacate the order denying plaintiff's motion, and to remand the matter for further discovery and investigation. Depending on what discovery reveals, the motion judge should reconsider conducting a plenary hearing to resolve contested issues of material fact, before deciding anew the merits of plaintiff's motion to reopen the divorce judgment and set aside the PSA. Where material facts are disputed or depend on credibility evaluations, a plenary hearing is required. Tancredi v. Tancredi, 101 N.J. Super. 259, 262 (App. Div. 1968). A plenary hearing may also be required when the record demonstrates that equity may mandate modification or reformation of a marital settlement agreement. Conforti v. Guliadis, 128 N.J.318, 322-23 (1992).

We do not preordain whether such a plenary hearing will be required, and leave it to the motion judge to make that determination with the benefit of information elicited during the post-remand discovery process. An evidentiary hearing is not required where the record before the court does not present a genuine issue of material fact. Barblock v. Barblock, 383 N.J. Super. 114, 123-24 (App. Div.), certif. denied, 187 N.J. 81 (2006); see also Harrington v. Harrington, 281 N.J. Super. 39, 47 (App. Div.) (noting that not every factual dispute in a matrimonial action requires a plenary hearing), certif. denied, 142 N.J. 455 (1995).

We similarly express no opinion on the ultimate merits of plaintiff's claim that defendant intentionally concealed the existence of marital assets from her during the parties' marriage and divorce. We determine simply that the proofs adduced by plaintiff meet the minimum threshold necessary to entitle her to discovery and potentially a plenary hearing regarding her claim.

Vacated and remanded. We do not retain jurisdiction.

1 A copy of the Belize bank application was appended to plaintiff's moving papers, although we note that no dollar sign appears before 107,644.