Martinovich v Bloch

[*1] Martinovich v Bloch 2013 NY Slip Op 51202(U) Decided on June 3, 2013 Supreme Court, Queens County Jackman-Brown, 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 This opinion is uncorrected and will not be published in the printed Official Reports.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 June 3, 2013
Supreme Court, Queens County

Liliana Martinovich, Plaintiff,

against

Lawrence Bloch, Defendant.



9581/2004



Dikman & Dikman

Attorneys for Plaintiff

5 Dakota Drive, Suite 208

Lake Success, NY 11042

Port & Sava

Attorneys for Defendant

734 Franklin Avenue #574

Garden City, NY 11530

Pam B. Jackman-Brown, J.

Recitation, as required by CPLR § 2219(a), of the following papers numbered 1 to 12 read on this Notice of Motion noticed on April 28, 2012 seeking an Order: (1) directing Defendant to pay for the parties' son, Andrew's college expenses, to the extent found appropriate by the Court; (2) directing Defendant to supply Plaintiff or her attorney with copies of all records and statements from the "college fund" previously established, from January 1, 2005 to date; (3) directing Defendant to reimburse Plaintiff for $986 in funds already advanced by her, in connection with Andrew's college application and related expenses; (4) directing Defendant to pay $3,500.00 as and for his contribution to Plaintiff's counsel fees in connection with this motion, and such greater amount as found due and proper, in the event a hearing is ultimately required to plaintiff's counsel is otherwise reasonably required to expend more time than the 8.75 hours covered by the $3,500 retainer paid; and (5) for such other and further relief as deemed just and proper by the Court; and Order to Show Cause, dated August 9, 2012, seeking an Order: (1) permitting the Defendant to reopen and interpose an opposition to the Plaintiff's Motion, dated April 28, 2012, pursuant to CPLR 2214; (2) in the event that an Order has been entered, an Order vacating such an Order pursuant to CPLR 5015; (3) permitting the Defendant to interpose a Cross-Motion for a downward modification in child support; (4) an Order granting the Defendant a downward modification in child [*2]support and (5) granting such other and further relief that the Court deems just and proper; and Notice of Cross-Motion, noticed on September 6, 2012, seeking an Order: (1) determining all pending motions, to wit: (1) Plaintiff's pending motion (brought on by Notice of Motion dated April 28, 2012, submitted without opposition on May 24, 2012 and currently awaiting a decision by the Court; (b) Defendant's Order to Show Cause dated August 9, 2012, (returnable October 4, 2012); ( c) this Cross-Motion, inasmuch as all of theses motions relate to the same litigants and topics (the parties' son's child support, college expenses and counsel fees) and because there have been substantial changes of circumstances since the original motion was made in April 2012, rendering some of the requests for relief moot or obsolete; (2) directing a hearing upon those issues which cannot be determined solely upon the motion papers; (3) directing Defendant to pay for Plaintiff's counsel fees in connection with this Cross-Motion and opposition to Defendant's Order to Show Cause; (4) upon such hearing, if not upon the motion papers alone, denying the Defendant's motion in all respects and directing him to pay for a stated percentage of the parties' son's college expenses, both his current school, Queensborough Community College and any future college he may attend, after the full utilization of the account previously set up for that purpose, and (5) for such other and further relief as deemed just and proper by the Court.

PAPERS NUMBERED PapersExhibits Notice of Motion - Exhibits and Affidavits Annexed40545A-G Order to Show Cause- Exhibits and Affidavits Annexed40638A-I Notice of Cross Motion-Exhibits and Affidavits Annexed41463A-H Affirmation41557A-B Affirmation12

Upon the papers listed above, this motion is hereby decided in accordance with this Decision/Order.

The parties were divorced pursuant to a Judgment of Divorce, dated April 5, 2006. Said Judgment incorporated the parties' Stipulation of Settlement (hereinafter Stipulation), dated May 18, 2005, but provided that the stipulation would survive the Judgment. On May 2, 2012, Plaintiff filed the instant post judgment Notice of Motion, noticed on April 28, 2012, seeking an Order: (1) directing Defendant to pay for the parties' son, Andrew's college expenses, to the extent found appropriate by the Court; (2) directing Defendant to supply Plaintiff or her attorney with copies of all records and statements from the "college fund" previously established, from January 1, 2005 to date; (3) directing Defendant to reimburse Plaintiff for $986 in funds already advanced by her, in connection with Andrew's college application and related expenses; (4) directing Defendant to pay $3,500.00 as and for his contribution to Plaintiff's counsel fees in connection with this motion, and such greater amount as found due and proper, in the event a hearing is [*3]ultimately required to plaintiff's counsel is otherwise reasonably required to expend more time than the 8.75 hours covered by the $3,500 retainer paid; and (5) for such other and further relief as deemed just and proper by the Court. Defendant defaulted. The motion was submitted on default May 24, 2012.

Defendant then filed the instant Order to Show Cause, dated August 9, 2012, seeking an Order: (1) permitting the Defendant to reopen and interpose an opposition to the Plaintiff's Motion, dated April 28, 2012, pursuant to CPLR 2214; (2) in the event that an Order has been entered, an Order vacating such an Order pursuant to CPLR 5015; (3) permitting the Defendant to interpose a Cross-Motion for a downward modification in child support; (4) an Order granting the Defendant a downward modification in child support and (5) granting such other and further relief that the Court deems just and proper. The default submission was held in abeyance pending the determination of Defendant's motion to reopen and interpose opposing papers.

Thereafter, Plaintiff filed a Notice of Cross-Motion, noticed on September 6, 2012, seeking an Order: (1) determining all pending motions, to wit: (1) Plaintiff's pending motion (brought on by Notice of Motion dated April 28, 2012, submitted without opposition on May 24, 2012 and currently awaiting a decision by the Court; (b) Defendant's Order to Show Cause dated August 9, 2012, (returnable October 4, 2012); ( c) this Cross-Motion, inasmuch as all of theses motions relate to the same litigants and topics (the parties' son's child support, college expenses and counsel fees) and because there have been substantial changes of circumstances since the original motion was made in April 2012, rendering some of the requests for relief moot or obsolete; (2) directing a hearing upon those issues which cannot be determined solely upon the motion papers; (3) directing Defendant to pay for Plaintiff's counsel fees in connection with this Cross-Motion and opposition to Defendant's Order to Show Cause; (4) upon such hearing, if not upon the motion papers alone, denying the Defendant's motion in all respects and directing him to pay for a stated percentage of the parties' son's college expenses, both his current school, Queensborough Community College and any future college he may attend, after the full utilization of the account previously set up for that purpose, and (5) for such other and further relief as deemed just and proper by the Court.

The parties appeared with counsel on January 24, 2013. After oral argument, all motions were fully submitted for determination.

Preliminarily, the Court notes that at the time of Plaintiff's Notice of Motion, noticed on April 28, 2012, the parties' child was not enrolled in Dowling College and does not reside on college campus. As of the date of submission of this motion on January 24, 2013, the child is attending Queensborough Community College.

Defendant's Default on Motion Noticed on April 28, 2012

Defendant seeks an Order permitting Defendant to reopen and interpose an opposition to the Plaintiff's Motion, dated April 28, 2012, claiming that motion was improperly served. [*4]Defendant stated that the motion was not personally served pursuant to Civil Practice Law and Rules §308. Plaintiff countered that service was proper.

New York Civil Practice Law and Rules (hereinafter "CPLR") §2214(a) provides that a notice of motion shall specify the time and place that the motion shall be heard and include the supporting papers upon which the motion is based and the requested relief. CPLR §2214(b) provides that the motion must be served at least eight days prior to the date the motion is to be heard.

In the instant proceeding, it is undisputed that Plaintiff's attorney served the motion, by regular mail, on April 30, 2012. Defendant acknowledged receipt of the instant Notice of Motion but argued Defendant should have been personally served in accordance with CPLR §308 for the Court to acquire jurisdiction over Defendant to enforce this post-judgment. Since the motion was not personally served, Defendant argued that service is improper and he should be permitted to reopen and interpose opposing papers. Although Defendant relies on McAuliffe v McAuliffe,70 AD3d 1129 (3d Dept 2010) and Welsh v Lawler, 282 AD2d 977 (3d Dept 2001), as the basis seeking to reopen and interpose an answer, the Court finds that these cases are not analogous to the instant proceeding.

New York Domestic Relations Law (hereinafter "DRL") §244 provides that where a spouse defaults in paying a sum of money as required by an order, judgment or stipulation incorporated by reference in a judgment, the court shall make an order directing the entry of judgment for arrears. The application for such order must be made on notice to the other spouse as the court may direct. Courts have held, "this language implicitly requires that such an application be brought by an order to show cause" (Saad v Saad, 71 AD3d 1116, 1117 [2d Dept 2010]). By making a motion by Order to Show Cause to enforce a judgment, the Court directs the applicable service for the motion seeking enforcement of a judgment by a mode of service chosen by the Court to the noncomplying party. It should be noted that Defendant acknowledged that he received the notice of motion via regular mail.

Similarity, the New York Family Court Act (hereinafter "FCA") §423 further provides that an application seeking to establish, modify or enforce a child support obligation must be commenced by the filing of a petition. Pursuant to FCA §427(a) provides the method of service shall be by personal service of a summons and petition to establish, modify or enforce a child support obligation. If after reasonable effort, personal service is not made, the Court may order substituted service in accordance with the CPLR upon proper application for alternative service.

Turning to the instant proceeding, the parties' Stipulation of settlement was incorporated by reference into the Judgment of Divorce. Therefore, the instant post judgment notice of motion is deemed to enforce that judgment as and for the terms outlined in the stipulated agreement. For that reason, the preferred method of service should have been by personal service. Curiously, the stipulation of settlement deferred the issue of payment of college expenses until, "such time as the parties begin to consider college [*5]attendance." Based on the very language in the stipulation, Plaintiff now seeks to enforce the stipulated agreement which defers the issue of college expenses and permits either party to seek judicial determination of the issue. Although Plaintiff is not seeking an Order directing a money judgment and has not filed a petition in family court, she seeks an Order directing Defendant to pay their child's college expenses, as part of Defendant's child support obligation. Therefore, a motion seeking an immediate Court action to or against another party, such as enforcement of an Order by any means should be served by personal service.

In addition, although not expressly provided in the CPLR or DRL, the Court finds Plaintiff's application to be analogous to an application seeking a money judgment for arrears or an application seeking to enforce, modify or establish a child support obligation, and as such, the motion should have been personally service.The preferred method to seek relief should have been by Order to Show Cause whereby the Court would have prescribed the mode of service and avoid the issue raised of improper service. Since Plaintiff elected to make her application by notice of motion and service by regular mail, and although receipt is acknowledged, the Defendant's application seeking an Order to reopen and interpose opposition to the Plaintiff's motion is granted.

Therefore, Defendant's moving papers shall be considered, noting that Plaintiff has already conceded that the default is moot and instead seeks attorney fees.

Plaintiff's Application Seeking College Expenses

The Court now turns to the branch of Plaintiff's Notice of Cross-Motion, noticed September 6, 2012, seeking an Order directing Defendant to pay for a stated percentage of the parties' son's college expenses. Although Plaintiff's Notice of Motion, noticed on April 28, 2012, sought an Order directing Defendant to pay a stated percentage of the child's anticipated college expenses at Dowling College, during the pendency of the instant motions, the child enrolled in Queensborough Community College. Plaintiff seeks an order directing Defendant to pay a stated percentage of the parties' son's current and future college expenses, after the full utilization of the account previously established for college expenses. Defendant argued that the issue of college expenses is moot as the parties' son is currently attending community college part time.

DRL § 240 (1-b)( c) (7) provides that the Court may direct a parent to pay a child's present or future, post-secondary educational expenses. In exercising its discretion, the Court shall consider the circumstances of the case and the parties and the child's best interests. The Appellate Division, Second Department has held, "support for a child's college education is not mandatory" (Lynn v Kroenung, 97 AD3d 822, 823 [2d Dept 2012] quoting Cimons v Cimons, 53 AD3d 125, 127 [2d Dept 2008]). If the Court directs a party to pay a child's college expenses, "such expenses are not necessarily prorated in the same proportion or percentage as each parent's income bears to the combined parental income" (Cimons v Cimons, 53 AD3d 125,130 [2d Dept 2008]). [*6]

In the instant proceeding, as previously noted, the parties' Stipulation of Settlement deferred the issue of college expenses until such time as the parties considered college attendance. In Article III paragraph 11(b), the parties agreed to utilize the Muriel Siebert and Co., Inc. custodial account as partial payment for the child's college education costs. Neither party has established the sum of the current balance of the custodial account nor an amount that is the child's current college expense. Significantly, neither party has shown that the balance of the custodial account is insufficient to meet the child's college expenses. Notably, while both parties submitted a Statement of Net Worth, neither party annexed their 2011 tax returns to their initial application.

Accordingly, Plaintiff's applications seeking an Order, directing Defendant to pay a stated portion of the child's current and future college expenses, directing Defendant to supply records and statements for the college fund and for reimbursement of funds advanced for Andrew's college application, are denied.

Defendant's Cross Motion Seeking a Downward Modification of Child Support

Defendant seeks a downward modification in his child support obligation due to an unexpected and unanticipated change in financial circumstances. Defendant is self employed as a sales representative for an aluminum supply company which designs and manufactures aluminum reflectors used for aluminum lighting. Defendant claimed that the demand for aluminum reflectors has drastically decreased and severely impacted his business. Defendant argued that he has lowered his income in an attempt to keep his business afloat and hired two new employees in an attempt to enter into a new market. Defendant claimed that his attempts to enter into a new market have not generated business.

Plaintiff opposed Defendant's application. Plaintiff argued that Defendant failed to annex his personal 2011 tax return and further argues that Defendant's income increased since the parties' executed their Stipulation of Settlement.

The Court of Appeals has held that courts should not freely disregard Stipulations of Settlements. Where parties include child support provisions in a separation agreement, the court must consider the provisions "as between the parties and the stipulated allocation of financial responsibility should not be freely disregarded. It is to be assumed that the parties anticipated the future needs of the child and adequately provided for them." (Boden v Boden, 42 NY2d 210, 213-214 [1977]). Thus, "child support provisions in a settlement agreement should not be disturbed unless there are a substantial, unanticipated, and unreasonable change in circumstances since the entry of divorce" (Barillas v Rivera, et al., 32 AD3d 872, 873 [2d Dept 2006]). To determine whether there is an unforseen, substantial change in circumstances sufficient to warrant a downward modification, the court must measure the change by comparing the payor's financial circumstance at the time of the divorce and at the time of the application seeking a downward modification (Schnoor v Schnoor 189 AD2d 809, 810 [2d Dept 1993]). "A party seeking a downward [*7]modification based on a loss of employment must submit evidence showing a good-faith effort to obtain employment commensurate with that party's earning capacity or, alternatively, must establish that his or her previously established earning capacity has been impaired" (Matter of Fowler v Rivera, 40 AD3d 1093, 1094 [2d Dept 2007]). "A hearing is necessary on the issue of changed circumstances where the parties' affidavits disclose the existence of genuine issues of fact" (Schnoor at 810).

At the time of the stipulation, Defendant represented that his annual income was $203,920.00 annually, after statutory deductions. Although in his affidavit and Statement of Net Worth Defendant claimed his current income is $120,000.00 annually, Defendant's 2010 tax return reflects an annual income of $595,211.00, of which $440,422.04 is attributable to Defendant through his employment and/or ownership of Bloch Aluminum. For the tax year 2012, Defendant only submitted business tax returns, reflecting an annual income of $1,254.472.00, with the sum of $612,030.00 as compensation to officers. Notably, Defendant submitted a purported 2012 payroll statement from his business. However, the purported statement was not prepared on a company letterhead. The statement also fails to include any identifying information and does not include the time period for which it is intended to reflect. It is worthy of note that Defendant submitted his 2012 W-2 which reflects an annual income of $159,260.26. However, this information is inconsistent with the figure provided in his affidavit and Statement of Net Worth. Defendant argues that his business has steadily declined since 2008. But there is no proof to support Defendant's claim that his business declined.Rather, the evidence indicates that Defendant's income significantly increased, as reflected by Defendant's 2010 tax return. The Court is unable to determine Defendant's 2011 income since he failed to submit a 2011 tax return or W-2 form.

Based upon the evidence submitted, the Court finds Defendant's claims regarding his business and income to be incredible and inconsistent.

Assuming arguendo that Defendant's claimed income is $120,000.00, which this Court does not find credible, the Court considers whether Defendant established that his earning capacity has been impaired. Defendant alleged that his earning capacity has been impaired due to the demand for aluminum reflectors have decreased. In support of his claim, Defendant submitted a market forecast, prepared by McKinsey & Company. Although the forecast offers insight into the lighting market, the forecast does not include information specific to Defendant's business.In addition, Defendant failed to submit supporting proof, other than his own affidavit, regarding the impairment of his earning capacity.

The Court further considers whether Defendant established that he made a good faith effort to obtain employment commensurate with his earning capacity. Despite Defendant's claims that he reduced his income and hired two employees to generate new business in an attempt to maintain his business, he failed to submit evidence to substantiate his claim. The Court finds the conclusory allegations of Defendant to be [*8]insufficient to establish that Defendant made a good faith effort to obtain employment commensurate with his earning capacity (see Fowler). [FN1]

Upon Defendant's failure to make a prima facie showing of an unanticipated and unreasonable change in circumstances by his affidavit and supporting evidence, Defendant's application seeking a downward modification of his child support obligation is denied. (See Conway v Conway, 79 AD3d 965 [2d Dept 2010]). In addition, there is no prima facie disputed facts warranting a hearing.

Attorneys Fees

Plaintiff seeks an Order directing Defendant to pay the sum of $3,500.00 as contribution to Plaintiff's counsel fees in connection with Plaintiff's opposition to Defendant's Order to Show Cause and Plaintiff's Notice of Cross Motion. Defendant opposed the instant application and argued that Plaintiff should be responsible for her own legal fees.

As previously noted, it is well settled that payment of a child's college expenses is not mandatory. Although Plaintiff argued that Defendant's actions necessitated the filing of the initial Notice of Motion which resulted in further applications by both parties, the Court notes that the parties' Stipulation expressly deferred the issue of college expenses and provided that if the parties were unable to resolve the issue of college expenses, either party may seek to resolve the issue in a court of competent jurisdiction. Although Plaintiff may disagree with Defendant's position regarding the payment of college expenses, the parties chartered their course of action when they executed their Stipulation of Settlement and there was no reservation of right to counsel fees.

Accordingly, Plaintiff's application seeking counsel fees is denied.

The above constitutes the Decision and Order of the Court. All applications not specifically granted or denied are deemed denied.

So Ordered

Dated: June 3, 2013__________________________

Queens, New YorkJSC

Footnotes

Footnote 1:The Court notes that Fowler is distinguishable in that the Court found Defendant's conclusory statements to be insufficient after hearing, while the instant proceeding is based upon the moving papers.