Y.B. v G.B.
Annotate this CaseDecided on September 16, 2022
Supreme Court, Richmond County
Y.B., Plaintiff
against
G.B., Defendant
Index No. 50332/2019
Plaintiff is represented by Michael Coscia Esq. of Abrams Fensterman LLP (1 Metrotech Center Suite 1701, Brooklyn NY 11201)
Defendant is represented by William Beslow Esq. (1270 Avenue of the Americas, 7th Floor, New York, NY 10020)
Two of the subject children were represented by Ian Berliner Esq. (42 Richmond Terrace, Suite 300, Staten Island NY 10301
One subject child was represented by Anthony Morisano Esq., (432 Forest Ave, Staten Island, NY 10301) Catherine M. DiDomenico, J.
Procedural History
By Summons with Notice filed April 12, 2019, Plaintiff Y. B (hereinafter "Wife") commenced this action for divorce against Defendant G. B (hereinafter "Husband"). A Verified Complaint was filed by Wife on or about May 30, 2019. It appears from the official court record that Husband never filed an Answer to Wife's Complaint. On or about May 15, 2019, the parties agreed by Preliminary Conference Order that Wife would be granted a divorce on the grounds that the marriage had broken down irretrievably for a period of six months pursuant to DRL §170(7). The parties were married on August 15, 2009 in a religious ceremony. There are three children of this marriage: M. B (d.o.b. **/**/2011); N. B (d.o.b. **/**/13); and C. B (d.o.b. **/**/18). Wife is currently 38 years old (d.o.b. **/**/84); Husband is currently 36 years old (d.o.b. **/**/86).
The issues of custody, visitation, child support, equitable distribution, maintenance, and counsel fees were tried before this Court over the course of eleven days between September 23, 2021, and January 13, 2022. Throughout this case, Husband was represented by William Beslow Esq. Wife had six attorneys represent her at various stages of this divorce proceeding. Before commencement, Wife retained Yonatan Levoritz Esq., but he was discharged a few days later as [*2]Wife discovered that he had "met" with Husband. At the time the Request for Judicial Intervention ("RJI") was filed in April 2019, Wife was represented by Adam Edelstein Esq. of Edelstein, Faegenburg and Brown LLP. A Consent to Change Attorney from the Edelstein firm to the firm of Felder, Felder and Nottes was filed on April 23. 2019. Michael N. Klar Esq. of the Felder firm moved to withdraw as counsel in October of 2019 (Mot. Seq. No. 005) which was granted by Order dated October 8, 2019. On October 25, 2019, a Notice of Appearance was filed by Jeffrey Kaplan, Esq. of J. Kaplan, and Associates, PLLC. On June 4, 2020, Mr. Kaplan filed an Order to Show Cause to be Relieved as Counsel (Mot. Seq. No. 007) which was granted by Order dated June 24, 2020. On June 26, 2020, Mary Grace Condello, Esq. filed a Notice of Appearance on behalf of Wife. On or about December 10, 2020, Ms. Condello filed an Order to Show Cause to be Relieved as Counsel (Mot. Seq. No. 012) which was granted by Order dated February 22, 2021. On March 9, 2021, a Notice of Appearance was filed by Michael Coscia, Esq. of Abrams Fensterman, LLP. Mr. Coscia tried this case on behalf of Wife and continues as her counsel to date. However, while this matter was sub judice, Mr. Coscia also filed a Motion to be Relieved as Counsel (Mot. Seq. No. 019). Mr. Coscia's motion remains undecided as of the writing of this Decision and will be addressed herein. The multiple applications by Wife's attorneys to withdraw as counsel, and their reasons for asking to be relieved, are discussed later in this Decision. Suffice to say here, the numerous changes in counsel unduly delayed these proceedings and caused unnecessary legal fees amounting to thousands of dollars.
On or about October 23, 2019, Thomas Conigatti, Esq, was appointed to represent all three subject children. After the untimely passing of Mr. Conigatti on July 9, 2019, Mr. Ian Berliner was appointed to represent the three subject children. In May 2021, when it was alleged that the two oldest children (M. B and N. B) no longer wanted to see their father (which position was in conflict to that of the youngest child C. B), Mr. Berliner sought the appointment of a second attorney to represent C. B. As C. B was only three years old at that time, by Order dated May 13, 2021, Rita Kaufman, Esq. was appointed for the purpose of substituting judgment for this young child. When Ms. Kaufman was unable to appear for the stipulated trial dates, she was substituted by Anthony Morisano, Esq. on September 14, 2021. Throughout this litigation, the attorneys for these children were paid privately by the parties subject to reallocation as addressed later herein.
On joint application, and by Order dated July 9, 2019, Dr. William Kaplan was appointed to conduct a forensic examination. Among other issues, Dr. Kaplan was ordered to address the issues of physical custody, parenting time, domestic violence, mental illness, and interference with parental rights. Dr. Kaplan interviewed the parties, the children, and numerous collateral sources he deemed appropriate in accordance with his professional practice and standards. Husband was ordered to pay 100% of the cost of Dr. Kaplan's services subject to reallocation. Dr. Kaplan issued his report bearing a dictation date of March 28, 2020.
As this case continued, the relationship between Husband and M. B and N. B deteriorated significantly, ultimately resulting in Husband voluntarily suspending his own parenting time in May 2021. He did this to spare these children any further trauma caused by being "forced" to visit with him. At the urging of Husband and with the support of the attorneys for the subject children, this Court directed Dr. Kaplan to supplement his report by Order dated May 13, 2021. Dr. Kaplan was directed to re-consider the question of whether there were grounds to conclude that the children were being alienated from their father by Wife. In a supplemental report dated October 8, 2021, Dr. Kaplan found that Wife had engaged in acts which caused M. B and N. B to [*3]become alienated from their father to a degree rarely seen before in his experience. Dr. Kaplan further predicted that, if an intervention was not mandated quickly, C. B would align with her sisters and similarly refuse to visit with her father. As discussed below, M. B and N. B remain unjustifiably rigid and steadfastly unyielding in their contempt for their father and their refusal to have anything to do with him. Their position flies in the face of the trial record which reveals overwhelmingly that Husband was a loving affectionate parent who never did anything wrong to these children.
At trial, Wife testified on her own behalf and called the following witnesses: (1) Husband; (2) Dr. William Kaplan and (3) Jeffrey Gibraltar (forensic business evaluator). Wife also placed voluminous documents into evidence (Pl. Ex. 1 to 86). Husband testified on his own behalf. Husband also placed voluminous documents into evidence (Def. Ex. A to CT). Judicial Notice was taken of several Orders (Ct. Ex. 1-20). In total, the trial record consists of over two thousand pages of testimony and over ten thousand pages of documentary evidence. Post-trial written summations were submitted by all counsel. An Inquest on the issue of grounds was held on the first day of trial. Wife was granted a Judgment of Divorce on the grounds that the marriage had broken down irretrievably pursuant to DRL §170(7). The Judgment was held in abeyance until the remaining issues in this divorce were adjudicated as required by this statute.
The fees related to court-appointed lawyers and neutral experts were paid by the parties, often from funds held in escrow, pursuant to orders issued throughout the course of this litigation. Both parties now seek reallocation of those payments. The first escrow account ($400,000) contained funds that Wife was ordered to surrender after she liquidated marital bank accounts immediately prior to the commencement of this divorce. The second escrow account (approximately $896,487) represented the sale proceeds from jointly owned marital property located at *** West Fingerboard Road ("West Fingerboard Road"). After trial, each attorney updated his respective Statement of Proposed Disposition regarding these accounts. As of June 2022, approximately $440,000 [FN1] remained in these accounts after the numerous distributions discussed in detail below.
The Parties' Positions
In her written Summation, Wife seeks an Order of shared custody for all three children with residential custody and final decision-making rights entrusted to her and visitation awarded to Husband. However, she knows this is not feasible as a practical matter because M. B and N. B refuse to have any contact with their father. Wife argues that she has always been the primary caretaker of the children as Husband typically worked long hours managing their jointly owned business. She claims that Husband never really had a close relationship with the children as he was always primarily concerned with his business. She denies that she engaged in any acts of physical violence towards Husband and vehemently denies that she has alienated M. B and N. B from him. She claims Husband is to blame for their strained relationship. Wife claims that her efforts to convince M. B and N. B to visit with their father have been unsuccessful. She suggests no solution to the impasse between the two older children and their father, nor any thoughts as to how she would effectuate her offer of shared custody. Finally, Wife denies interfering or sabotaging Husband's visits with the youngest child C. B.
Regarding parental access, Wife testified Husband should see all three children on alternate weekends and at least once during the week. She does not explain how this schedule could possibly be implemented as a practical matter. Husband does not visit with M. B and N. B and has not even seen them for at least 15 months. Husband finally gave up trying to force them to see him after Wife filed an unsuccessful motion to suspend his visits. He eagerly awaits implementation of court ordered therapy so he can start seeing them again. As for C. B, Husband has court ordered access every Tuesday and Thursday from after school (2:40) until 7:30 pm. He also has visits with C. B every Saturday from 10:00 to 7:30 pm. and on alternate weekends he keeps C. B overnight on Saturday until Sunday at 7:30 pm. (Tr. p. 320-21).
With respect to economic issues, Wife claims Husband wrongfully wasted a myriad of marital assets and prevented the completion of their intended "dream home" located at *** West Fingerboard Road in Staten Island New York. She further alleges that Husband deliberately allowed their jointly owned business YG. D LLC ("YG. D") to fail in order to reduce her equitable distribution, maintenance, and child support awards. To this end, she asserts that prior to her filing of this divorce YG. D LLC made millions of dollars annually but stopped operating completely as this case dragged on. She alleges that Husband withdrew significant sums of money from YG. D LLC post commencement without giving her the 50% share she was entitled to as an equal co-owner. She disagrees with KLG, the neutral business evaluator, regarding the current value of YG. D LLC and what caused its demise. She asks this Court to assign a value of over $2.7 million dollars to the business and to award her 50% of that amount. Wife alleges that Husband may be secretly running the business under a different name but provided no proof of the same. Wife also seeks distribution of numerous bank and retirement accounts. In addition to equitable distribution, Wife seeks maintenance and child support awards based upon an imputed income of $500,000 for Husband and without using statutory caps resulting in a proposed monthly combined award of $16,657 ($8,943 in child support, $7,714 in maintenance).
Wife seeks reimbursement of all her counsel fees related to this proceeding in the approximate amount of $613,836. Wife argues that Husband is the more monied spouse and has prolonged this litigation by concealing his real income and failing to comply with court orders. Wife claims that the costs and expert fees attributed to her during this litigation should also be reallocated fully to Husband.
Husband seeks sole legal and physical custody of C. B with whom he has maintained a close loving relationship. Husband argues that an award of sole custody for C. B is necessary to safeguard his relationship with her. Considering the damage Wife has caused to his relationship with M. B and N. B, as opined by Dr. Kaplan, Husband agrees that it is not possible to remove them from Wife's home at this time given the psychological trauma it would cause them to suffer. He reluctantly agrees that shared legal custody is the only award possible until their relationship is remediated through court mandated therapy. He seeks sole decision- making authority regarding medical and educational decisions for M. B and N. B to prevent any further interference from Wife. He also seeks the preservation of his right to file for an access schedule when appropriate. Finally, Husband seeks an award of child support for C. B should he be granted custody.
Regarding equitable distribution, Husband identifies many of the same assets as Wife and agrees to an equal distribution of the same. As to YG. D LLC, Husband asserts that Wife was involved in managing the business as a co-owner, that the business "employed" her family members, and that Wife was fully informed as to the company's finances and its operations. [*4]Husband claims he did not voluntarily abandon YG. D LLC but ended its business activities after Wife abandoned the business and caused the traumatic events detailed herein. Husband also explained that market forces made its business model obsolete. Husband agrees with the forensic business evaluator's assessment of YG. D LLC's present-day value of $57,000. However, he argues that the business never needed to be valued because it is jointly owned and neither party has indicated a desire to buy the other's interest. He argues that the cost of this "unnecessary" analysis should be reallocated to Wife because she misled this Court into believing she was making a contribution claim regarding "his" business. Husband asserts that unless Wife wants to buy him out, or the business is sold, it needs to be dissolved.
Additionally, Husband seeks distribution of the funds remaining in escrow. Husband asks this Court to reimburse him for counsel fees he incurred during this proceeding based upon many unsupported positions and applications filed by Wife, delays caused by multiple substitutions of counsel, failure to follow clear Court Orders, and most significant, her ongoing efforts to alienate him from his children. Husband argues that requiring him to contribute to Wife's counsel fees would constitute a miscarriage of justice, based upon her conduct and the positions she has taken during this proceeding.
Regarding maintenance and child support, Husband argues that he was forced to reluctantly concede physical custody and voluntarily suspend parental access with his two eldest children based on Wife's acts of alienation. He argues that any award of child support must be suspended as an incentive for her to reverse the damage she caused to this relationship. Husband states that if Wife takes meaningful steps to restore his parental access with M. B and N. B, he will gladly pay child support as determined by this Court.
Finally, Husband identifies as a victim of domestic violence. He testified that Wife continuously assaulted, harassed and verbally abused him for a period of approximately thirty minutes on March 16, 2019 ("the March 16 Incident"), with the entire event captured on video. To add insult to injury, Wife then caused him to suffer the trauma of surrender, detention, and arrest after she lied to the police stating that he assaulted her. Husband was held for hours and only released from police custody after supervisors viewed the video he presented. As detailed below, after watching the video, the police immediately released Husband and arrested Wife for making a false claim, endangering the welfare of the subject children, and assault. Husband claims that the trauma he experienced from the March 16 Incident permeates all the issues in this case and cannot be surgically applied to certain claims. It led to the breakdown of his marriage, interfered with his ability to focus on their jointly owned business, and was the first concrete proof of Wife's attempts to alienate him from their children. To this end, and as detailed below, Wife involved the children in this assault and then fed them a false narrative which caused them to fear and hate their father. These false traumatic memories were implanted in these impressable children and then nurtured, exaggerated, and promoted by Wife to Husband's detriment.
General Factual Findings
The Parties
The parties met in 2007 in Baltimore when Husband was attending the University of Maryland. He graduated with a Bachelor's Degree in Finance in 2007. The parties married on August 15, 2009. They lived in Baltimore before moving to Brooklyn. They then moved to *** Alan Loop in Staten Island in 2012 ("Alan Loop"). Wife earned a Bachelor's Degree in Human Resources from Empire State College in 2013.
Husband was the sole wage earner for this family. Wife worked various retail jobs prior to the marriage but stopped working when she married Husband. She never made more than $5,000 any year until she was given an ownership interest in YG. D LLC. Wife was primarily responsible for taking care of the home and children. Beginning in 2018, the parties hired a cleaning lady to assist Wife with household chores. Wife continued this service until March 2020. After she was involved in a car accident, Wife did not drive for an extended period. Husband ran errands and drove her and the children to activities.
Early in the marriage, Husband worked as a staff accountant at KE Diamonds then left for a network financing job at EET Network. At or around that time, he also started an eBay business reselling items for profit. He later worked at Viacom performing tasks that he later incorporated into a digital marketing business (GD. U LLC) he formed with Wife's brother. After this divorce was commenced, Husband sued Wife's brother for issues related to GD. U LLC. In August 2019, Wife's brother settled that litigation for $100,000 buying out all of Husband's interest in that company. Wife seeks distribution of this settlement.
Wife stopped working prior to the birth of M. B. Husband was happy with her taking care of the home and their children. Wife claims to have few marketable skills, although she has a college degree and speaks several languages, including Russian, Persian, Hebrew, Turkish and English. Although the children are now school age, Wife has not taken steps to obtain gainful employment. When asked about the future, Wife indicated she may go back to school, or maybe apply for law school, but was not sure she could get a tuition loan.
In January 2015 Husband formed YG. D LLC, and by the end of that year Wife was made a fifty percent owner. A typical workday for Husband started with driving M. B and N. B to school, working at the office for a few hours, then coming home to spend time with the family. In the company's most profitable years, it had become mostly automated which allowed him to spend more time with his family. In the evening he would sometimes return to work or work remotely from home. After becoming an equal partner in the business Wife was involved in making business decisions and supported Husband in the operation of the company.
Wife claims that Husband was not very involved in the lives of the children. However, the evidence at trial proved that Husband had a close loving relationship with all three subject children before the commencement of this divorce action. Husband credibly testified that when he was home, he often took care of the children, spending time with them and playing with them while Wife did other tasks around the home such as preparing meals. He used to take care of C. B's nighttime feedings allowing Wife to sleep. At trial, Husband introduced persuasive video evidence of him playing lovingly with all the children, feeding them, and acting affectionately with them. This Court credits Husband's testimony that he played an intricate role in raising these children, such as taking them to gymnastics and piano lessons and waiting for them until their lessons concluded. He took them to school, assisted with homework and engaged in other activities that loving parents often do with their children.
When pressed, Wife admitted Husband was a "loving" father but "loving in his own way." She claims that Husband did not have a close bond with the children: "I would not describe it as them having a bond or strong connection. I would describe it more as if it was in a way encouraged by me. Roughly to say there were times they were almost forced by me" (Tr. p. 1151). She testified that Husband put his own needs before the needs of the children. She claims when he was home, he was often on the phone tending to their business as opposed to giving the children his full undivided attention. She further claims that she was the only parent responsible [*5]for teaching the children basic skills, such as how to ride a bicycle. None of these assertions were proven at trial. While Husband sometimes worked long hours, he was simultaneously engaged in the lives of the children, perhaps more so than many fully employed parents could manage under similar circumstances. There is no evidence to suggest that these children feared him until they witnessed the March 16 Incident and began living exclusively with their mother. This reality lends credence to Husband's assertion that the difficulties he is now experiencing with the children resulted from Wife's interference.
Wife testified that she is a devoted mother who meets all the needs of her children. Husband acknowledges that Wife has been the primary caregiver for the children during their marriage and that she is capable of meeting their basic daily needs. Wife claims Husband was abusive to her. However, her testimony is not credible. Indeed, the evidence at trial proves Wife was, in fact, the abusive partner in this relationship. Husband blames Wife for alienating M. B and N. B from him by involving them in the March 16 Incident and then blaming him for the violence they witnessed. The Court credits Wife's testimony as to her devotion to the children. However, Husband has proven that Wife is primarily responsible for the destruction of his relationship with M. B and N. B and is incapable of fostering a relationship between them, a primary factor to be analyzed in any custody determination. See Matter of Copeland v. Brown, 189 AD3d 1396 (2d Dept. 2020); see also E.E.C. v. S.S., 73 Misc 3d 597 (Sup. Ct. Monroe Cty. 2021).
Husband maintains a close loving bond with C. B, who spends significant time with him, including overnight visitation. Husband fears that, if he is not granted sole legal and physical custody of C. B, this relationship will deteriorate as she increasingly aligns with Wife and her two older sisters. This fear is substantiated by the testimony of Dr. Kaplan and shared by this Court. In fact, Wife has already unsuccessfully moved to suspend Husband's visitation with C. B (Mot. Seq. No. 013). In her Affidavit dated May 11, 2021, Wife indicated that she was "very much opposed to having the youngest child visit with [Husband]." On July 11, 2022, while this Decision was being written, Husband filed an emergency Order to Show Cause (Mot. Seq. No. 020) seeking an immediate change of custody for C. B alleging new acts of alienation by Wife affecting this child. This application has not yet been heard by this Court and will ultimately be resolved by this Decision.
At trial, and in her Statement of Proposed Disposition, Wife suggests a parental access schedule for Husband and all three children that provides for alternate weekend visits with additional parenting time during the week. While this schedule looks good on paper, it is not feasible given the current situation in which the older children refuse to have anything to do with their father. Wife offers joint legal custody with final decision-making authority granted to her. Husband agrees to joint legal custody of M. B and N. B. He seeks final decision-making regarding education and medical decisions (including mental health) as the only alternative given the damage caused to the relationship. He seeks sole legal and physical custody of C. B with an access schedule for Wife similar to the schedule she proposes for him. In Husband's view, limiting the influence of Wife and the two older children on C. B is the only way to protect her from being alienated.
The Subject Children
The subject child C. B, who is currently four years old, was not presented for an in- camera examination on consent of all parties based on her tender age. The two older subject children were interviewed in camera by this Court. M. B is currently eleven years old, and N. B [*6]is currently eight years old, although she is about to turn nine. They present with no special needs. The subject children have lived with their mother since the March 16 Incident. M. B and N. B do well in school. C. B is not yet in school but will likely begin some program this year.
During the course of this litigation, the unified position of M. B and N. B has been advocated by their counsel, Ian Berliner Esq. M. B and N. B express deep love and affection for their mother and seemingly "hate" their father. In their eyes, he is the cause of the ruination of their family, does not love them, never did anything good for them, "needs therapy" and is otherwise irredeemable. In contrast, they view their mother as infallible and idolize her. Similarly, Wife testified that she believes every word her children say as they are incapable of lying to her or even misperceiving events (Tr. pgs. 1170-1173). When the subject children were asked what their father did (or failed to do) to warrant their unyielding negative view of him, they offered few examples. They alleged several insignificant missteps on his part such as not being as good a cook or attempting to impose mild discipline on them, which their mother never does. Some of their allegations range from silly ("putting cookie crumbles" in their pockets) to ridiculous (chasing them around the kitchen with a butcher knife).
Suffice to say, the two older children are strictly aligned with their mother who has supported and reinforced their negative views of their father. Notwithstanding years that have passed, M. B and N. B remain unmovable in their antipathy for their father in a way never before seen by this Court or the forensic evaluator. Their view appears to have no basis in reality. Rather, these children have adopted Wife's perception of Husband as their own. What their mom thinks about their dad is what they think. Any attempt to suggest an alternative view causes them to be confused and angry. The testimony of M. B and N. B is preserved in the sealed in- camera transcript which has been given serious consideration by this Court. Their attorney has advocated that they remain living in the care and custody of their mother with no access to their father outside of a therapeutic setting which should be ordered "immediately... with the ultimate goal of reunification" (Berliner Sum. pg. 1).
YG. D LLC
In January 2015, Husband formed YG. D LLC a digital advertising firm. Husband originally had a partner, but shortly after the company was created Husband bought his partner's share of the company for $2,000. YG. D LLC began operations in March 2015. It routed internet traffic to third party retailers through the use of "click-through ads." YG. D LLC generated income based upon the number of "clicks" that directed internet users to the third-party sites. Internet users were enticed to click on the links to obtain rewards, including gift cards. Rather than relying solely upon actual users clicking on the links, Husband began paying individuals, including members of Wife's family, to drive traffic to the site. He paid these third parties with gift cards as well. Husband fully automated the process by creating programs ("macros") that imitated the function of a mouse and automatically clicked the links 24 hours a day, 7 days a week. To effectuate this, YG. D LLC rented space and stored computers at various locations, including the homes of Wife's family members. Husband maintained these systems which generated constant profits.
By the end of 2015, Husband assigned a fifty percent ownership interest in the company to Wife. In its best years, the company generated between five to six million dollars in revenue. Husband was the company's sole employee; however, the company utilized several independent contractors, many of whom were paid with gift cards. Many of the independent contractors were members of Wife's family. Over time, YG. D LLC steadily increased the number of computers it [*7]used to drive traffic. At one point, it owned between 100 and 150 computers. Wife was aware of the size of the company and its continued growth. She knew that the company was earning profits from computer generated activity as well as paid independent contractors, and live customer driven traffic.
From March 2015 to March 2020, Husband worked full time for YG. D LLC. Wife testified that she was not involved in the company "at all" and knew nothing about how it operated or its financial condition. This testimony was not credible as the evidence at trial supports a finding that Wife knew, or should have known, the intricacies of this company, how it made its money, and how much it made. For example, the parties filed joint tax returns in 2016 and 2017. Wife was aware who the company accountant was and had access to the books and records. She was a signatory on the company bank accounts and was listed as an owner on tax filings. Several of Wife's relatives "worked" as independent contractors for the company including her mother, sister, and brother. Each had the automatic click program installed on computers in their home and were responsible for ensuring that the computers were operating correctly. Conversely, none of Husband's family were involved with YG. D LLC.
YG. D LLC had its best year in 2017 when it earned approximately $6.9 million dollars in revenue. However, Husband credibly testified that beginning in mid-2018, there was a marked decline in business. Between 2018 and 2020, YG. D LLC lost its largest clients. This was due to changes in the digital industry that negatively impacted YG. D LLC's' business model. Growth in the advertising industry and mergers of leading market participants in 2018 resulted in YG. D LLC's services becoming obsolete. Husband credibly testified that "around the same time, You Tube became really big It became a change in consumer's option of video content in the industry" (Tr. p. 412). As internet companies such as Facebook, Google and YouTube began placing ads directly on their sites, they no longer needed third parties to drive traffic. This reduced and eventually eliminated YG. D LLC's usefulness.
Husband tried desperately to turn the situation around, but business conditions worsened. As the companies' contracts came up for annual renewal, they were not renewed or renewed at much less lucrative terms. Husband had many conversations with Wife about the changing business environment and its ramifications on the business. Wife indicated that she understood, and suggested that Husband find new clients, which he unsuccessfully tried to do. As a result of these market conditions which were largely beyond the parties' control, YG. D LLC's gross revenue decreased to $5.3 million in 2018 and to $749,034 in 2019.
Husband claims that Wife also contributed to the demise of their business after the commencement of this action. As Husband was actively searching for new clients, he became aware that two of his former associates (M. M and A. V) were working for new clients. He wanted to see if he could recruit their new employers as YG. D LLC clients. However, before he could negotiate a deal, they were contacted by Wife who allegedly told them that Husband had "beat" her and the kids. She also told them Husband was embezzling money from YG. D LLC. Husband believes Wife severely damaged his reputation and their company's reputation with these baseless allegations. Needless to say, this avenue proved fruitless to securing a lifeline for YG. D LLC.
Throughout the course of the marriage, business distributions were shared equally between the parties. After this action was filed, Husband failed to share the distributions taken from the company with Wife even though she remained a 50% owner. Wife seeks her full share in equitable distribution. Although Wife testified that she had little knowledge of what went on [*8]in the company, video surveillance from the parties' Nanny Cam shows them discussing at least one significant financial issue involving the filing of company tax documents (Def. Ex. BP). Husband testified that this was just one example of the routine conversations they had regarding the business. In 2018, after the parties purchased the West Fingerboard Road property, they took equal distributions from the company in the form of pre-paid American Express gift cards. They used these gift cards to pay the contractors working on the property and to buy supplies for the construction. In total, between December 2018 through April 2019, the parties obtained approximately $380,000 in prepaid American Express gift cards from the business (Tr. p. 1921). Some were also used by the parties for their personal use, including as gifts, for day-to-day purchases, and for luxury clothing, handbags, and jewelry. Wife claims that she did not know the extent to which Husband was using pre-paid gift cards, but her testimony was not credible. For example, Wife was confronted with her own text messages which evidenced she was aware of at least $95,000 worth of gift cards that arrived on December 26, 2018. In a series of text messages to Husband Wife exclaimed "OMG ["oh my god"] 95 K Can I have it all Yay shopping here we come Chanel, Hermes " (Tr. p. 1090; ex. BX). This is obvious proof that Wife was not being truthful when she testified on this subject.
At trial Wife attempted to prove that the way YG. D LLC conducted its business, namely using automated systems to "create" traffic to various client sites, was illegal. She claimed that a similar company was indicted for similar behavior. She alleged that Husband used pre-paid gift cards for the purpose of evading income taxes or some other unlawful reason. Wife proved neither at trial. In fact, the forensic business evaluator testified that as the pre-paid gift cards were accounted for properly on the corporate books and records, there was no impropriety. It is curious that Wife would try to convince this Court that YG. D LLC was an illegal operation as she owned fifty percent of it, equally profited from it, and the parties filed joint tax returns in 2016 and 2017 (Pl Ex. 8 & 9). Moreover, if it was illegal, Husband was correct to close it, rather than continuing it as Wife argues he should have done.
In March 2020, Husband was not earning enough money from YG. D LLC to meet his court ordered pendente lite obligations. Without authority from this Court, he began selling YG. D LLC's computers to fund the company while he looked for full-time employment. In February 2020, Husband accepted full time employment with "Seeking Alpha" making $200,000 per year plus stock options (Tr. pgs. 125-126). After Husband learned that Seeking Alpha may be closing its advertising department, he began looking for new employment opportunities. On July 15, 2021, Husband secured employment at a company owned by his cousin, "Secret Box Distribution Corp." He was given the title of Vice President of Operations with a salary of $220,000 per year with the potential to earn a $30,000 performance bonus. His current employment does not provide medical benefits. As of his trial testimony on September 23, 2021, Husband was still paying for COBRA family coverage at a monthly cost of $3,500.
The West Fingerboard Road Property
On June 22, 2017, the parties purchased property located at *** West Fingerboard Road in Staten Island, New York, for approximately $920,000. They took out a $550,000 mortgage. Both of their names were on the deed. They hired an architect to demolish the existing structure and construct a 6,000 square feet home with four bedrooms and an office. Anthony Madonia was hired to serve as general contractor. He secured several subcontractor trades. Many of the payments made to the contractors and to vendors and suppliers were made by the parties in the form of pre-paid American Express gift cards taken as distributions from YG. D LLC. Husband [*9]credibly testified that they spent about $1 million dollars in materials and construction costs.
The parties never moved into the West Fingerboard Road home as their plans were interrupted by the March 16 Incident and this divorce proceeding. Husband estimated that approximately $250,000 in additional funds would be needed to complete the renovations. Throughout the course of this proceeding, Wife made repeated applications to this Court to allow her and the children to occupy this unfinished home. Wife was willing to reside in this unfinished home with the children, but several inspections necessary to ensure that it was safe to live there could not be scheduled as the work was not complete. This Court issued several Orders aimed at completion of the construction, but Wife consistently frustrated this process, primarily by alleging wrongdoing by Mr. Madonia. Wife accused Mr. Madonia of conspiring with Husband to overcharge, double bill for work already done, and other illegal practices. Like many of the subcontractors, Mr. Madonia ultimately stopped work at the premises and filed a lien due to numerous unpaid invoices. Wife denied that she obstructed the renovation and blamed it on Husband. Her claims were unsupported and not credible. The children blame their father for not allowing them to live in their "dream house," a belief fostered by Wife who often drove them to see the unfinished home.
Jewelry
During YG. D LLC's profitable years, the parties spent approximately $375,000 on expensive jewelry. Wife credibly testified that she bought many expensive pieces for herself, Husband, and the children in 2017 and 2018. Wife purchased Rolex and Piaget watches for herself and for Husband, one of which cost $39,195. Wife frequented very high-end jewelry stores, including Cartier, Tiffany, Chopard U.S.A., William Barthman Jewelers, and Van Cleef & Arpels, where she purchased various rings, earrings, bracelets, and other expensive pieces with prices ranging from $800 to $24,427. The parties viewed these purchases as "investments."
In January 2019, after the parties began having marital problems, Wife worried that Husband would steal the jewelry from their joint safe deposit box located at T.D. Bank. Rather than wait for Husband to empty the boxes, she emptied them herself. Wife withdrew the jewelry, an unknown number of gift cards, and approximately $10,000 in cash all without informing Husband (Tr. p. 1046). She then opened a new safety deposit box at the same bank bearing only her name. She testified at trial she never used the new box to store the jewelry out of fear that Husband would learn of its existence from the bank employees. Instead, she took the contents of the safe deposit boxes home and hid them in various pouches, bags, and shoe boxes in her bedroom closet. The violence on March 16, 2019 began when Husband unknowingly came too close to finding the hidden jewelry.
After Husband returned home on March 19, Wife worried again about the jewelry. That night, she checked her hiding spots and allegedly discovered that all the hidden pieces were gone. She claims that Husband stole them. Husband testified that he was never looking for, nor did he ever find, the hidden jewelry. He claims that on March 19 he returned to the house in the presence of Wife's mother and C. B, to obtain some personal belongings and to leave a birthday present for M. B. As discussed later, the Court does not credit Wife's claim that Husband stole the jewelry. Rather, this Court credits Husband's claim that Wife still possesses it. This is the only logical conclusion as Wife admittedly hid the jewelry after removing it from the joint safe deposit box and assaulted Husband when he came close to finding it.
Bank Accounts
During the course of their marriage, the parties accumulated several savings, investment [*10]and retirement accounts. At trial, each accused the other of secretly withdrawing monies from these accounts and using the funds inappropriately. These accounts, and a myriad of other assets, are discussed at length in the "Equitable Distribution" portion of this Decision.
Specific Incidents Relevant to this Decision.
The parties enjoyed a relatively stable married life for most of their ten-year marriage. While they occasionally argued, often about the amount of time Husband was allocating to the marital business, the marriage appeared to be largely harmonious. In 2016-2018, the marital business was thriving, the children enjoyed a loving relationship with both of their parents, and the parties were planning to relocate to their dream house. While neither party could point to a specific point in time when their marriage began to sour, they both agree that their marriage became irretrievably broken in 2019.
January 2019 Incident
In January 2019, the parties had a particularly intense argument sparked by a conflict between the Husband and Wife's mother, the details of which were not discussed at trial. The parties agree that during (or just after) this argument Husband told Wife he may want a divorce. Wife claims that he did so in front of the children traumatizing them. Husband claims the children were upstairs. He testified and that Wife later told the children that their father wanted a divorce and was going to abandon them. This Court credits Husband's account of this incident. Wife left the marital home for a short period of time after the argument but returned home. The parties continued living together in the marital home and things seemed to return to normal. However, Husband's passing reference to a divorce continued to trouble Wife. This nagging feeling that Husband was planning on leaving her led Wife to withdraw the contents of the safe deposit boxes and take other steps to financially prepare herself if Husband filed for divorce. Ultimately, it was Wife who filed this action against Husband.
March 16, 2019 Incident
On March 16, 2019, the parties had a physical altercation which ended their marriage and began the process that ultimately destroyed Husband's relationship with M. B and N. B, perhaps irreversibly. Given the significance of this Incident and the fact that it served as the starting point for virtually every other issue of importance in this trial, the parties allotted a considerable amount of trial time to this subject.
The following factual findings are made by this Court after listening to the parties' extensive testimony and carefully viewing the video surveillance of this incident. While the master bedroom's "Nanny Cam" was unable to capture much of what occurred inside the closet, the footage clearly captured the events that occurred inside the bedroom and in the closet doorway. In addition to the Nanny Cam video, this Court has also viewed a much shorter cell phone video, strategically taken by Wife's sister, exhibiting part of the event that occurred inside the closet. As to the parties' conflicting accounts of what happened inside the closet, which was not captured on video, this Court credits Husband's account. This Court does not credit Wife's testimony with respect to what happened and the reasons why this event occurred.
Wife received a Summons to report for jury duty. On March 15, 2019, hoping to get excused from that service, Wife asked Husband to find C. B's birth certificate and passport, thinking that C. B's young age would justify her inability to serve. Husband told her he would "look for it tomorrow." The following day, on March 16, 2019, Wife reminded Husband to look for C. B's birth certificate. At the time of this conversation, the parties were in their downstairs living room. All three children were present as was Wife's mother and sister. Husband went [*11]upstairs to the marital bedroom and entered the walk-in closet to search for the container in which they regularly kept these documents. Wife, knowing that she had hid over $260,000 in jewelry in that closet, entered the room a short time later and sat on the bed. For several minutes Wife appears to speak calmly to Husband as she directed him where to look in the closet.
Suddenly, at around the 4:00 minute mark of the Nanny Cam video, Wife's demeanor changes. She began screaming at Husband, telling him repeatedly to get out of "her closet" and to stop touching her things. While Husband continued to search, Wife jumped up from the bed, reaches into the closet and began tugging on Husband. As time passes, Wife became increasingly infuriated, first spitting at Husband, then hitting him with her hands, closed fists, slapping and pinching him. The video shows Wife repeatedly kicking him, biting him, and grabbing at his genitals, doing anything she could to force him to abandon the search.
As the assault continues, and for no legitimate reason, Wife began screaming "Stop hitting me; He's hitting me. Look, he's hitting me" to her sister. As evidenced by the video surveillance and as found by this Court after trial, Husband never hit Wife. Rather, it was Wife who was the sole aggressor in this extended encounter which she alone initiated and provoked. Her testimony at trial to the contrary, offered even after viewing the video evidence, was patently unbelievable.
Throughout this incident, Wife's sister was present in the bedroom. Rather than attempting to deescalate the situation, Wife's sister pulled out her cell phone and started recording the event. At one point, Wife's sister moved closer to the closet so she could get a better view of what was transpiring. Throughout most of the incident, Wife's sister yelled at Husband, telling him to "go watch your kids, I'm not the nanny for your children," and "what kind of parent are you?" Thirteen minutes into the Nanny Cam video, Wife and sister left the room for a brief period and then returned with C. B, who was less than a year old at the time. Wife sat on the bed and resumed screaming at Husband with C. B in her arms. Husband remained in the closet looking for the passport.
Four minutes later, Wife got up from the bed and resumed her assault, hitting Husband with one hand and kicking him with one foot while holding baby C. B in her other arm. C. B struggled to hold on as her mother attacked her father. At or around this time Maternal Grandmother, who was supposed to be watching M. B and N. B downstairs, left those two young children unattended and enters the bedroom. She did nothing to stop the incident and began yelling at Husband. At 22:49 on the Nanny Cam video, Wife's sister grabbed C. B from Wife, and passed the crying baby over to Maternal Grandmother. Sister then entered the closet and joined Wife's continued assault on Husband. Sister connected with a few punches before walking away and resuming her recording. At 28:30 on the Nanny Cam video, Wife sister noticed that M. B and N. B came upstairs into the bedroom. Rather than taking steps to protect these children from this traumatic incident, she called them into the room to watch the assault.
In an appalling turn of events, Wife and her sister then directly involved M. B and N. B in this event. They instructed the children, who were screaming and crying, to tell their father to stop hitting their mother, even though he was not hitting her. After a short pause, in which the children appear confused, they began dutifully chanting what Wife and sister directed them to say. M. B and N. B began screaming and crying "stop doing it," "stop hitting her." As they cried and screamed, M. B and N. B repeatedly looked to their mother and aunt for direction. At 31:02 on the Nanny Cam video, Wife exited the closet pointing at her bleeding lip, and screamed to M. B and N. B that this is what their father did to her. In truth, Wife injured her own lip while biting [*12]Husband, an act presumably not witnessed by the children. At 37:53 on the Nanny Cam video, M. B walked towards the bedroom door to exit the room. Wife's sister grabbed her by the arm and told her to go back to the closet. At 37:53 on the Nanny Cam video, Wife turns towards M. B and N. Band said "you're almost eight. I hope you remember this forever."
Wife then motioned for M. B to approach the closet where Husband and Wife were wrestling. M. B complied. Wife immediately grabbed M. B and pulled her up onto a chair that was in the closet. With M. B now squarely in the middle of the conflict, Wife continued to wrestle with Husband while yelling at him to get out of the closet. Husband mumbled that he would, but that he couldn't leave without causing M. B to fall. After Wife moved M. B, Husband finally exited the closet. In a rush to leave, he left his glasses on the floor and rushed out of the house in only his shorts, a t-shirt, and socks.
This Court finds that Husband could have deescalated the situation by abandoning his search earlier, a point he remorsefully conceded at trial. However, this is the only criticism that can be directed at Husband. Overall, Husband showed a remarkable level of patience, maturity, and restraint despite a terrible attack. There is no evidence that Husband ever raised his hands to Wife during this thirty-minute encounter. Rather, Husband had very little reaction to being assaulted. He simply withstood the attack until he realized his children were witnessing the event and crying hysterically. When asked why she had such a violent reaction to Husband's search in the closet, Wife initially admitted that she feared he may be looking for the jewelry that she hid, but then changed her story to claim that she was upset because he was damaging her belongings. Wife admits that she was the one who asked him to search the closet in the first place.
Wife's Police Report and Family Court Filing
a. Criminal Case
On March 19, 2019, three days after the incident, Husband returned to the marital home to give M. B a Tiffany bracelet for her birthday. Wife was on a school trip with M. B and N. B. Wife's mother and C. B were home when Husband arrived. Husband had a brief conversation with Wife's mother and asked to hold C. B for a few minutes. He then returned C. B to her grandmother, went upstairs briefly to leave the gift in M. B's room and collect some personal belongings, and then left the house. When Wife got home, her mother told her that Husband had been at the house. Wife testified that, based on what her mother said, she believed Husband came to the house to, in effect, kidnap C. B.
On March 22, 2019, in an alleged attempt to protect the children and prevent Husband from taking them without her permission, Wife contacted the police. When talking to the officers she claimed that Husband assaulted her on March 16, 2019. Specifically, she stated that Husband struck her in the face, arms and legs multiple times before pushing her into a closet and held her down against her will. In support of these accusations, Wife showed the police a misleading shortened clip of the cell phone video taken by her sister during the incident. Based upon this misleading video and patently false information, a warrant was issued for Husband's arrest.
Husband was not made aware of the arrest warrant until April 1st at which time he immediately surrendered himself upon the advice of counsel. Upon arriving at the precinct at 8:00 am, Husband was handcuffed and taken into custody. Although he had a USB drive with the Nanny Cam video on it, he was told that he would have to wait for the detective to arrive before having the opportunity to state his case. When the detective arrived at around noon, Husband gave him the USB drive. Two hours later, the officers returned to the cell in which Defendant was being held. Husband was released from custody and was informed that Wife [*13]would be arrested for assaulting him and for making a false police report.
The following day, April 2, 2019, Wife was arrested and charged with Assault in the Third Degree (Penal Law 120.00[3]), three counts of Endangering the Welfare of a Child (Penal Law 260.10), Falsely Reporting an Incident 3rd Degree (PL 240.50 [3]) and Harassment (PL 240.26[1]) (Def. Ex. BF). She was arraigned in Criminal Court and was released on her own recognizance subject to the terms of a limited Temporary Order of Protection issued in favor of the three subject children. Her case was transferred into this Integrated Domestic Violence Part on or about April 29, 2019. On the first appearance before this Part the Temporary Order of Protection was modified to add Husband and remove the subject children. On August 6, 2019, on application of the People, and because Husband did not want to press charges and make the situation worse for the children, Wife's criminal case was adjourned in contemplation of dismissal. The limited Order of Protection against Wife in favor of Husband was continued for one year and expired on its own terms on August 5, 2020.
b. Family Court Case
On March 22, 2019, the same day Wife filed a police report against Husband, Wife filed a Family Offense Petition in Family Court. In her Petition, Wife swore to the truth of the following allegations:
"On March 19, 2019, Petitioner [Wife] states that Respondent [Husband] tried to take the baby away while she was sleeping in the stroller when Petitioner was in school. Petitioner mother prevented this from happening even though Respondent was pushing her hard. On March 16, 2019, Petitioner states Respondent physically and verbally abused Petitioner. Petitioner states Respondent beat her up, hurt her, pushed her into the closet corner and would not let her free. This lasted for over an hour. The children were home on the first floor, and they came upstairs to the second floor screaming and crying asking Respondent to get off the Petitioner which he did" (Def. Ex. BE).Wife swore to the truth of these allegations for a second time later that day when she appeared ex parte before a Family Court Judge (DeLizzo, J.) in support of her application for a Temporary Order of Protection. Wife sought an Order excluding Husband from the former marital home and ordering him to stay away from her and the subject children, among other terms. The Temporary Order of Protection requested by Wife was granted at that appearance. The Family Court also issued a Court Ordered Investigation directing the Administration for Children's Services ("ACS") to investigate Wife's allegations. This caused ACS to open an investigation in which the children were questioned. On April 4, 2019, the Family Court Judge allowed an exception to the Order for "incidental contact to facilitate parenting time with the children" although Wife would not agree to the same. On April 17, 2019, the Family Court Judge ordered that all video evidence (including that pertaining to the March 16 Incident) be produced. Wife withdrew her Family Offense Petition in response to this judicial directive.
When testifying at this trial, Wife insisted that her version of events pertaining to the March 16 Incident, as reported to the Police and the Family Court, were true. When cross examined and shown the Nanny Cam video, Wife refused to admit that she was the aggressor. Instead, she testified that during the incident Husband grabbed her face, forcefully laid on top of her, and squeezed her hands (Tr. pgs. 953-54). Despite clear evidence to the contrary, Wife continued to assert that Husband attacked her in the closet. Wife claims that she was "provoked" and acted the way she did in self-defense.
This Court finds that none of the sworn allegations made by Wife to the Family Court or [*14]to the Police Department were true, and her testimony to this Court about the incident was not credible. It is deeply concerning that in the face of clear video evidence Wife refused to admit the truth of what occurred that day and to assume responsibility for her actions. Although he was released by the police, Husband was detained for hours in a jail cell. Thereafter, he remained subject to a mandatory arrest policy from March 22 until April 27 because of Wife's false sworn statements to the Family Court and its issuance of an Order of Protection. It is notable that Wife only withdrew her Family Offense Petition after it was evident that the full video surveillance would be viewed by that Court. In all, Husband was prevented from contact with his children for some six weeks because of Wife's frivolous and false filings. This Court credits Husband's position that the filing of these false allegations against him was one of the first instances in a long pattern of parental alienation by Wife to destroy his relationship with the children.
Custody/Parental Access
At trial Wife seeks an award of joint custody of all three children with final decision- making authority. Wife suggests that Husband should have a "normal" parental access schedule while admitting that N. B and M. B will not visit with him, even if ordered to by this Court. Husband acknowledges that, under ordinary circumstances, he would be seeking custody of all three children but understands that attempting to force contact with M. B and N. B would be detrimental to their welfare as long as Wife continues her acts of alienation. Accordingly, Husband seeks an award of sole legal and physical custody of C. B, while reserving the right to seek visitation with M. B and N. B in the future, when and if their relationship improves. Husband suggests that this Court should award Wife visitation with C. B carefully, fearing that she will also become alienated if Wife is given the opportunity.
In support of their respective positions at trial, both parties attempted to show that they were the more fit custodial parent. To this end, both parties testified to a litany of events that occurred during their relationship and throughout this litigation. Many of these incidents were not critical to this Court's determination of custody and parental access. Rather than dignify each incident between the parties, this Court discusses herein only those significant findings of fact, and related custodial factors, that weighed most heavily in this Decision.
When determining an appropriate custodial arrangement, the primary concern for the Court is the best interests of the children. See Cunningham v. Brutman, 150 AD3d 815 (2d Dept. 2017). There is "no prima facie right to custody of the child in either parent." DRL §70[a]; DRL §240 [1][a].When determining custody, the Court must consider the "totality of the circumstances" including the relative fitness of the parties and quality of their home environments. See Matter of Torres v. Cortes, 168 N.Y.S.3d 884 (2d Dept. 2022). Factors to be considered include "the quality of the home environment, the parental guidance the custodial parent provides for the child, the ability of each parent to provide for the child's emotional and intellectual development, the financial status and ability of each parent to provide for the child, the relative fitness of the respective parents, and the effect an award of custody to one parent might have on the child's relationship with the other parent." See Salvatore v. Salvatore, 68 AD3d 966 (2d Dept. 2009); see also McGovern v. Lynch, 62 AD3d 712 (2d Dept. 2009). The preferences of the subject children, while not determinative, is another factor to be considered by the Court. See Matter of Xiomara M. v. Robert M., 102 AD3d 581 (1stDept. 2013). The weight to be afforded to each of the various factors is within the discretion of the trial court and requires an evaluation of the testimony, character, and sincerity of all the parties involved. See Bourne v. [*15]Bristow, 66 AD3d 621 (2d Dept. 2009).
(a) The Forensic Evaluator
The analysis and recommendations of a Forensic Evaluator is but one factor to be considered when determining a custodial arrangement. See Matter of Nieves v. Nieves, 176 AD3d 824 (2d Dept. 2019). When the issues raised in a proceeding are beyond the typical knowledge and understanding of a layperson, expert testimony is generally warranted. See e.g. Matter of Michael B. (Lillian B.), 145 AD3d 425 (1st Dept. 2016); see also Goudreau, v. Corvi, 197 AD3d 463 (2d Dept. 2021). Here, considering that the two subject children have no identifiable objective basis for their negative, unyielding view of their father, the Court finds that the expert analysis provided by this well-qualified Forensic Evaluator should be afforded more weight than it ordinarily would be in a typical custodial analysis. Indeed, this Court found Dr. Kaplan's reports invaluable when trying to understand the otherwise unexplainable position taken by M. B and N. B given the history of a loving relationship with their father. As explained below, Dr. Kaplan issued two Reports in relation to this proceeding ("Kaplan" & "Kaplan 2").
In his first report Dr. Kaplan described Wife as "cooperative, sincere, neatly attired and appropriate." She "appeared overwhelmed and intimidated" by what she described as "an abusive marriage with a highly abusive Husband." She presented as "fearful" and traumatized by her husband's "aggression and threats." She repeatedly mentioned the strain caused by insufficient finances. She claimed to have no information about Husband's business activities other than that they were illegal.
Wife made various allegations against Husband to Dr. Kaplan during the preparation of his first report, most of which were unsubstantiated at trial. Wife alleged that Husband had twisted N. B's arm, that he inappropriately opened the bathroom while the children were using it, and that he locked them in the closet. She also said Husband was being investigated for physical and sexual abuse of the children (Kaplan, p. 8). Wife indicated that ACS came to her home in the early hours of the morning to check on the children and interview them. She also claimed that husband "treated her in a sadistic fashion sexually," was unfaithful to her, and was extremely controlling.
Husband described the March 16 Incident to Dr. Kaplan. He also gave his opinion regarding Wife's interference in his relationship with M. B and N. B and the drastic change in their conduct from visit to visit. For example, they very much enjoyed the new "American Girl" dolls Husband purchased for them during one visit and then suddenly changed their view and wanted nothing to do with them on their next visit. They ignored the dolls and threw them under the bed because "he had bought them." Husband vehemently denied to Dr. Kaplan that he was ever sexually or physically abusive to his wife or children. Husband expressed his desire to share joint custody of all three children, but also his concerns about parental alienation. He was also concerned that Wife has refused to allow the children to engage in any consistent and meaningful therapy, notwithstanding this Court's direction.
Dr. Kaplan interviewed M. B and N. B with their father present. C. B was a baby and too young to be interviewed. The girls had to be coaxed into the room after refusing to leave their mother's side. They clung to each other and appeared "fearful, sullen and quiet" By the end of the interview, Dr. Kaplan characterized M. B and N. B as "strikingly joyless" (Kaplan, pgs. 18- 19).
Conversely, when the children were interviewed in the presence of their mother, they were "cute, delightful, relaxed and related warmly to mother" (Kaplan, p. 22). They were happy and chatty. [*16]They provided a litany of specific reasons why they do not want to see their father including that he thinks they watch TV too much. Wife used the opportunity to disparage Husband in front of the children. She noted that the children are usually happy unless they have to visit with their father, at which point they become frightened. Wife alleged that the children's fear comes from "how he treats them." Wife also told Dr. Kaplan, in the presence of the children, that Husband "uses the children to hurt [her]" and has wrongfully deprived them of the opportunity to live in their new home.
At the conclusion of his first Report, dated March 28, 2020, Dr. Kaplan found that both parents were fit to care for the children. He recommended that Wife remain the physical custodial parent, that decision making be shared, and that Husband enjoy overnight parenting time with equal holiday access. He also recommended that the parties use a parent coordinator or therapist to assist them in co-parenting. He further recommended that a clinical child psychologist be secured to help the children cope with the separation of their parents. He stated: "it is imperative to nip in the bud early signs of the alienation and the opposition M. B and N. B have manifested towards their father, for which their mother bears at least some of the responsibility" (Kaplan, p. 39). At the time of his first Report, Dr. Kaplan viewed the relationship between Husband and the M. B and N. B as repairable and that it "should not be allowed to fester into an intractable situation." Finally, Dr. Kaplan advised Wife that she should accept the fact that Husband will have access to the children and support this reality lest she "become responsible for causing alienation between the children and their father, which will not be easy to repair and will likely cause much unnecessary emotional suffering and maladjustment for the girls" (Kaplan, p. 39).
Sadly, after the issuance of Dr. Kaplan's first report, the relationship between Husband and M. B and N. B continued to deteriorate. Wife brought an Order to Show Cause to suspend Husband's visits with all three children on May 12, 2021 (Mot. Seq. No. 013). Wife claimed that Husband was a danger to all three children based on allegations that he forced his way into the bathroom when the girls were using it; chased them around the apartment with a knife; locked them up in their rooms and deprived them of food. At trial, Wife admitted she was had no personal knowledge of any of these alleged acts. However, she stated that she believes her children without hesitation, no matter what they say, as they are incapable of lying or exaggerating.
A motion hearing was held during which it was obvious to the Court that Wife's application was frivolous. However, rather than cause any additional stress to these children, and in order not to have his healthy relationship with C. B infected by the toxic dynamics haunting the other children, Husband reluctantly volunteered to suspend his visitation with M. B and N. B. His visits with C. B continued. On Husband's application, Dr. Kaplan was asked to update his March 2020 Report. By Order dated May 13, 2021, this Court directed Dr. Kaplan to address the allegations that resulted in Husband's voluntary suspension of visits with the two older children, along with a reassessment of Husband's "strongly held belief" that Wife was alienating the subject children from him.
On or about October 8, 2021, Dr. Kaplan issued his updated Report (Ct. Ex. 2). Therein, he continued to recommend that Wife remain the physical custodial parent of all three children based in part on the fact that Husband was the primary wage earner. Dr. Kaplan recognized, however, that the relationship between Husband and M. B and N. B had significantly deteriorated to the point where they represented a "united front" in refusing to have anything to [*17]do with their father. The children parroted their mother's disparaging views of their father and were "unyielding" whenever Dr. Kaplan made an effort to ask them to consider an alternative outlook in regard to their relationship with dad (Kaplan 2; p. 13). They offered "no hope" that the relationship with their father could ever be repaired.
Dr. Kaplan testified before this Court on January 6, 2022, and January 12, 2022. On consent of all counsel, he was qualified as an expert witness and his two forensic reports were admitted into evidence (Ct Exs.1 & 2). Over the course of nearly two days of trial, Dr. Kaplan explained the basis for his belief that Wife had engaged in a series of acts that caused the children to become alienated from their father. His testimony, which is credited by this Court, is discussed below as part of this Court's custody analysis. Under the unique circumstances of this case, and the difficult issues that it presented, the Court found Dr. Kaplan's analysis to be extremely useful in understanding the nature and dangers associated with parental alienation. Dr. Kaplan's expert opinion was given considerable weight.
(b) Financial Ability
Neither parent has raised financial inability as a reason to prevent the other from being awarded custody. While Husband is the more monied parent on paper, the maintenance and equitable distribution awards herein significantly balance the parties' finances. To the extent that Husband's financial ability is relevant to his application for custody of C. B, the Court finds that he is, and has been, gainfully employed throughout the marriage and throughout this litigation. The Court finds Wife earned a significant income when she was actively involved with YG. D LLC. The Court finds that, although Wife has not indicated much of an interest in becoming gainfully employed, she is capable of supporting M. B and N. B by utilizing the maintenance and equitable distribution awards herein.
(c) General Fitness to Parent
In a general sense, the Court finds that both parents are equally capable to care for the basic daily needs of the subject children. Neither parent has been the subject of a child protective proceeding, although Wife's involvement of the subject children in the March 16 Incident is deeply concerning. Despite her conduct that day, Wife has been the children's primary caretaker during the marriage and this proceeding. While the Court does have serious concerns about the children's mental health in Wife's care, those concerns are addressed elsewhere in this Decision.
Husband has been an exemplary parent to C. B and had a close loving relationship with M. B and N. B prior to the March 16 Incident. Wife was comfortable leaving Husband to care for the children during the marriage when she was unavailable, evidencing that she had no concerns for their safety until the commencement of this action. Indeed, Wife admitted as much on the stand claiming she has no concerns for the children's' physical well-being when they are in his care (Tr. pgs. 1938-39). Clearly, this testimony is perplexing when considered against Wife's application to suspend visits based on claims that Husband chased the children around his apartment with a knife, withheld food, and interfered with their use of the bathroom. The Court finds that there is no credible evidence that Husband is incapable of caring for his children. Thus, as both parents are equally capable of meeting the practical daily needs of these children, this Court gives little weight to this factor.
(d) Education of Each Party
Both parents attended college and received equivalent degrees. Wife has a Bachelor's Degree in Human Resources which she obtained in 2013. Husband has a Bachelor's Degree in Finance with a Minor in International Business which he obtained in 2007. During the course of [*18]this litigation Wife has been responsible for taking M. B and N. B to school, ensuring that their homework is done, and otherwise meeting their educational needs. Prior to this divorce, both parties were involved in the children's education, helping them with their studies, taking them to school and engaging in intellectual enriching activities. Neither party claims the other lacks the educational background to be a suitable custodial parent. Accordingly, this factor was given little weight by this Court.
(e) Age/Health/Drug or Substance Abuse/Mental Health of Each Party
Neither party has asserted age, physical health, or substance abuse as a barrier to custody or parental access in this case. Regarding mental health, while no diagnosis has been offered to this Court regarding either party, this Court would be remiss if it did not consider Husband's allegations regarding Wife's conduct during the marriage. He credibly testified as to violent outbursts, episodic anger, and an overarching inability to appreciate the consequences of her actions, particularly regarding the children. This was evident at trial where Wife exhibited a stunning lack of insight into the ramifications of her actions and their effects on the children and their relationship with their father. Despite watching clear video evidence of the March 16 Incident over the course of an entire day of trial, she refused to accept the reality that she was the sole aggressor in the situation. Even when shown the aspect of the video where she is holding C. B and assaulting Husband, Wife would not acknowledge the inappropriateness of her conduct or that she endangered her daughter in any way. She denies that her behavior caused or contributed to the demise of this family. Wife's inability to admit the reality of what happened on March 16 and the effect it had on this family is deeply concerning.
This Court's own observation of Wife as she testified, and as she listened to others testify, and in response to this Court's own inquiries, reveals that she lacks any real understanding of what she did. When directly asked by this Court if she felt in any way responsible for the breakdown of her family she replied, "I feel the guilt that I should have left their father long before that day" (Tr. p. 936). This Court believes that Wife needs the benefit of therapy to understand the consequences of her actions and to move beyond her stubborn refusal to admit errors in her own judgment. In this regard, Wife claims to have engaged in therapy for a few sessions, but that she simply stopped going. Wife has shown a clear skepticism and reluctance to engage in any meaningful and sustained therapy for herself or the children. The Court's concerns regarding Wife's inability to understand the consequences of her actions were given some weight when making this Decision.
(f) Extended Family
Husband has a large extended family. His parents live in Maryland. His mother sees C. B approximately once per month while his father sees C. B every few months. Husband notes that their visits are a positive experience for C. B. Husband has a sister, who has two children of her own that live with her in Virginia. Husband also has a cousin who lives in New Jersey with her family and an aunt who lives in Staten Island. Husband enjoys a close relationship with all his family members and enjoys having C. B spend time with all of them as often as possible. When they are not visiting in person, Husband and C. B enjoy facetime visits with them (Tr. pgs. 2012- 2014).
Husband credibly testified that Wife pushed Husband's family away during their marriage. Wife got into major fights with his family and would refuse to allow Husband or the children to visit with them over inconsequential matters. For example, Husband's sister sent a gift for C. B when she was born which Wife viewed as an inexpensive "piece of garbage." She [*19]then reminded Husband's sister of how much they had spent on gifts for her child. The next day a baby chair arrived from Amazon also from his sister. Wife threw it out only to buy a similar item several months later. Since the parties separated, Husband has rekindled his relationship with his family, particularly with his sister and her children. Husband has included C. B in family events, and they now enjoy a close loving bond with her.
Prior to this divorce, Wife's family was intricately involved in all aspects of the parties' lives. Husband testified that Wife's family, who all received income from YG. D LLC in one form or another, walked in and out of the marital home whenever they wanted. Husband developed a close relationship with Wife's family. However, as evidenced by the March 16 Incident, Wife's sister and mother treated Husband badly at times. They disrespected and belittled him in front of the children. Wife testified that her sister and brother no longer speak to her. It was unclear why she is now estranged from her siblings. Wife gave no further testimony as to her relationship with any other family members although it appears that the maternal grandmother may still be involved with the children on a regular basis.
As Wife is now estranged from her family, and as Husband now enjoys the freedom to restore the relationship between the children and their large extended paternal family, this Court has given some weight to this factor.
(g) Criminal History
Husband has no criminal history other than the baseless arrest following the March 16 Incident. This arrest was triggered by Wife's false report to the police department, and he was released as soon as officers saw the reality of the video. In turn, Wife was arrested on April 2, 2019, and charged with Assault in the Third Degree (Penal Law 120.00[3]), three counts of Endangering the Welfare of a Child (Penal Law 260.10), Falsely Reporting an Incident 3rd Degree (PL 240.50 [3]) and Harassment (PL 240.26[1]) (Def. Ex. BF). The endangering charge was premised on acts committed by Wife against Husband in the presence of the three children. Specifically, the Criminal Complaint alleges that Wife "did bite [Husband] in the face and did strike [Husband] in the face and body multiple times with a closed fist causing physical injuries including, but not limited to, a bite mark to the face, bruising, abrasions and redness to the face, neck, and arms, in addition to substantial pain, annoyance and alarm." The False Reporting charge was premised on allegations that Wife falsely reported the events of March 16, as follows: "the defendant did knowingly report information to a law enforcement officer that did not in fact occur, in that defendant did advise deponent, in sum and substance, that on March 16, 2019 at approximately 13:45 hours, G. Bdid strike defendant in the face, arms, and legs multiple times before pushing her in a closet and holding her down in said closet" (emphasis added).
Wife's criminal matter was transferred into this Supreme Court IDV Part on April 29, 2019. On August 6, 2019, after discussions between Husband and the District Attorney's Office, the matter was adjourned in contemplation of dismissal for one year. A limited Order of Protection in favor of Husband expired on August 5, 2020. The Court has considered Wife's arrest for the March 16 Incident and given it considerable weight.
(h) Domestic Violence.
Both parties make claims of abuse and maltreatment at the hands of the other. Husband points to the March 16 Incident and credibly testified that this was not the first time Wife became enraged at him. He claims that screaming, and degrading name calling was not an infrequent occurrence when Wife got mad. He credibly testified that Wife was ill tempered and impatient with him and sometimes with the children. When she was angry, she didn't care if the [*20]children were present for their arguments.
Wife testified Husband was controlling and abusive. When asked to describe her relationship prior to the March 16, 2019, Wife testified, "It started as a loving relationship, and it turned into a very abusive relationship" (Tr., p. 937). She claimed Husband controlled her movements; did not allow her to leave the house without permission; severely limited access to a vehicle and placed her under constant video surveillance. She also claimed Husband made her engage in sex acts that made her feel uncomfortable.
Wife attempted to depicted herself as a prisoner in her own home. She claimed Husband "cut her off" from her friends and hindered her career and education. She testified that Husband even dictated how long she had to complete household tasks, such as cooking. Specifically, she testified, "I was given literally twenty minutes to cook something when the kids would return from school I wasn't allowed to shower unless it was with his schedule whenever he was free. Usually at nighttime, very late at night" (Tr. pgs. 937-938). Wife did not claim to have reported this alleged abuse to anyone until the commencement of this action. In fact, she offered no evidence to support her claims aside from her testimony, which was vague, contradictory, confusing, and at many times, unbelievable.
Husband credibly denied Wife's allegations and argues that it was Wife who caused the drama and constant fighting in the house. Indeed, Wife's testimony on the subject was confusing at best. When asked whether there was any physical violence prior to March 2019, Wife answered "No" (Tr. p. 938). Then, when asked by her lawyer to give "some instances of specific abusive behavior," Wife replied it was "mostly moral and mental abuse" (Tr. p. 938). Husband credibly testified that he never blocked Wife's access to a vehicle. He testified that she always had a luxury vehicle at her disposal including an Acura and a BMW 3 Series that she selected for her own use. To the extent that Wife stopped driving, Husband credibly testified it was Wife's choice, made after she was involved in a motor vehicle accident that left her scared to drive. Wife ultimately admitted that she always had a vehicle available to her and that she maintained her own set of keys to that vehicle. However, she still claims that Husband did not allow her to drive and refused to let her leave the house without his permission. Wife's testimony is belied by the evidence in the record and presents as another example where she refuses to waiver from her litigation posture, regardless of the facts.
After considering the testimony of the parties, this Court finds that to the extent there were acts of domestic violence committed in this marriage, including harassment, disorderly conduct and even assault, they were committed by Wife against Husband. This finding is supported by the video evidence of the March 16 Incident as well as Husband's credible testimony. This Court has given substantial weight to the domestic violence that occurred between these parties and finds that Wife was the primary aggressor and instigator.
(i) Position of the Attorneys for The Children
The position of the subject children's' attorneys was also considered by the Court. See Matter of Guiracocha v. Amaro, 122 AD3d 632 (2d Dept. 2014); see also Matter of Conway v. Gartmond, 108 AD3d 667 (2d Dept. 2013). Both Mr. Berliner, who represented M. B and N. B, and Mr. Morisano who substituted judgment for C. B, were actively involved in this proceeding and trial. Mr. Berliner also presented M. B and N. B for an in-camera examination which will be discussed herein. Both attorneys have expressed serious concerns over the March 16 Incident and how the subject children were involved therein. While both attorneys question why Husband didn't leave the closet sooner, they agree that Wife's actions were far more egregious than [*21]Husband's under the circumstances.
Consistent with his obligation to directly advocate for the position held by his clients, Mr. Berliner supports legal and physical custody of these children to Wife and for the continuance of the status quo in terms of Husband's access. However, he suggests that his clients and their mother should engage in the therapy sessions as recommended by Dr. Kaplan with the goal of repairing his clients' relationship with their father.
Conversely, Mr. Morisano argues that it would be in the best interest of C. B if Husband were granted sole legal and physical custody of this youngest child. He shares Dr. Kaplan's fear that, if C. B is left with her mother and sisters, she may begin to align with them and develop antipathy for her father. This would endanger the close loving relationship C. B presently enjoys with her father. Mr. Morisano acknowledges that maintaining the status quo is an important factor in any custodial analysis but urges this Court to award custody of C. B to Husband as the only viable alternative to safeguard their relationship. This Court has given substantial weight to the positions of the AFCs in this case.
(j) In Camera Examination / Wishes of the Children
The children's wishes were also considered by the Court. While not determinative, a child's expressed preference is a factor to be considered by the Court "particularly where the attorney for the child recommend[s] that the child's wishes be given weight" Matter of Ivory B. v. Shamecca D.B., 121 AD3d 674 (2d Dept. 2014). Both M. B and N. B were of sufficient age and intelligence to understand the nature of the in camera examination and the importance of telling the truth. M. B was interviewed separately from N. B. Mr. Berliner conducted the in- camera interview of each child. During the in camera, each child appeared sad, and at times, oppositional and angry. It is obvious that these children are not used to being challenged or even asked to explain the reasons for their fixed and rigid negative views of their father
While not disclosing the details, M. B and N. B articulated their positions clearly and consistently to this Court. They love their mother who does everything for them and does nothing wrong. She does everything better than their father who does nothing right. They refuse to acknowledge any positive interactions with their father anytime in their life even when shown video proof of happy occasions shared with him. They are unwavering in their desire to remain with their mother and to have nothing at all to do with their father. They are unwilling to visit with him or to even engage in therapy with him. They believe that their father is the only one in need of therapy.
They accuse their father of committing several acts which are consistent with their mother's allegations, none of which were proven at trial. Although interviewed separately, they each eagerly recounted a nearly identical litany of complaints about their father. None of these "transgressions" come anywhere close to justifying their antipathy for him or their refusal to see him. To the contrary, these events appear trivial and their testimony regarding their allegations was certainly rehearsed.
While this Court believes that the children honestly expressed their feelings, it gives very little weight to their statements given their young age and the fact their views do not comport with the evidence. Regrettably, M. B and N. B appeared to have been prepped and coached with respect to their allegations and what to tell this Court. Although they were interviewed separately, each child's testimony mirrored the others nearly identically. Each child appeared anxious to ensure that a predetermined list of reasons why their father was "bad" was recorded for the record to the point where each repeatedly interrupted the Court's questions to finish their [*22]prepared statements. When the Court, or their attorney, gently challenged their beliefs about their father, they responded with anger and disgust. Finally, these children came into the in camera convinced that this Court (who had never met them) was somehow biased against their mother and was going to force them to visit with their father against their wishes. As these children have had no contact with their father for a very long time, their "understanding" of what rulings the Court might make could only be the result of Wife's influence. Overall, the in-camera examinations were deeply troubling. The subject children's testimony was of very little evidentiary value except to confirm this Court's fear that Wife's influence is more pervasive that previously suspected.
(k) Ability to Foster a Relationship with the Non-Custodial Parent (Parental Alienation)
As alleged by Husband, affirmed by Dr. Kaplan, and found by this Court after trial, Wife has failed to properly parent the three subject children in a very significant way, namely she has interfered with the close loving relationship M. B and N. B enjoyed with their father. Of the many factors to be considered when determining a proper custodial arrangement, one of the most significant is a custodial parent's duty to foster a relationship with the non-custodial parent. See Matter of Copeland v. Brown, 189 AD3d 1396 (2d Dept. 2020). The inverse of this obligation, parental alienation, has been described by the Courts of this state as an "act so inconsistent with the best interests of the child as to, per se, raise a strong probability that the offending party is unfit to act as a custodial parent." Matter of O'Mahoney v. O'Mahoney, 206 AD3d 819 (2d Dept. 2022); see also Matter of Smith v. Francis, 170 N.Y.S.3d 195 (2d Dept. 2022).
A review of the relevant caselaw reveals that there is no single definition of "parental alienation." The Appellate Courts have stated, without much explanation, that alienation occurs when a "custodial parent unjustifiably frustrates the non-custodial parent's right of reasonable access." Matter of Addimando v. Huerta, 147 AD3d 750 (2d Dept. 2017). In some cases, the alienation can be caused by a single tragic incident that unjustifiably destroys the relationship between a parent and their children. However, in other cases, such as this one, the alienation manifests as a persistent pattern of affirmative acts and omissions undertaken by a custodial parent that are designed to weaken the bond between the children and the alienated parent. These acts and omissions serve to marginalize the alienated parent's involvement and significance in their children's lives. In this case, the acts and omissions detailed herein commenced with the March 16 Incident and have continued at least until the close of the trial record.
Husband's relationship with M. B and N. B has not always been strained. The trial record contains many video recordings of these children playing with their father, embracing him, laughing with him, and loving him as children typically do when they feel safe and nurtured by a parent. Wife really did not (and could not) refute this evidence. Rather, she argued that while Husband may have had a close bond, hers was closer. If true, this is understandably attributable to the fact that Wife was their primary caretaker while Husband was managing the marital business. In any event, this Court is not in the position to analyze the degree of intimacy between a parent and child using some artificial comparative measure. Suffice to say, the evidence in this trial reveals overwhelmingly that M. B and N. B loved their father and sought him out in a typical fashion, as they did their mother, until the March 16 Incident and the filing of this divorce by Wife a month later.
After reviewing the trial evidence, assessing the credibility of the testimony offered by both parties on the stand, and conducting an in-camera examination of the two older children, this Court finds that Wife has caused damage to M. B and N. B's relationship with their father in [*23]a way that may be irreversible. Wife has told this Court (and Dr. Kaplan) that she wants the children to visit with their father and that she encourages them to be more open and responsive to him. Sadly, this Court does not believe her. Wife is quick to say the correct thing, after being advised by counsel, but she refuses to follow her words up with any meaningful action. It is not that Wife lacks influence over her children such that her encouragement does not carry weight. M. B and N. B adore their mother, and see her not only as a parent, but also as their best friend. They also feel the need to guard their mother from their father, a fear fostered by Wife's tendency to share details of this divorce proceeding, many of which are false, and all of which are tainted by her anger towards Husband.
The subject children, like many young children, tend to exaggerate events and report to their mother what they think she wants to hear. The problem here is that Wife claims to believe these stories, regardless of their veracity, and has utilized them as a factual basis for applications to suspend Husband's parenting time. Among other examples, Wife has rigidly accepted as true ludicrous claims by these children that their father chased them around his apartment with kitchen knives, deprived them of food, locked them in rooms, and forced his way into the bathroom while they occupied it. Rather than correcting these statements, or inquiring as to their veracity, Wife relied upon them to further her own desire to limit Husband's parental access.
For example, Wife testified that she believed three-year-old C. B's story that when she visits her father, "he takes her to see a woman in a castle house with a pink fairy dress and yellow hair, two babies and two dogs one with pink hair and one with blue hair and that the woman hits her hands and kisses her father on the lips." (Tr. pgs. 918-19). On the stand, when asked by this Court if it was possible that then three-year-old C. B made this story up, Wife replied that her children do not lie, and she believes whatever they tell her, one hundred percent (Tr. p. 1170).
In another example, Wife reiterated a story told to her by M. B and N. B where they claimed that their father abandoned them in a restaurant. It appears that they were relating an incident that allegedly occurred in a Max Brenner restaurant in June 2019 (Tr. pgs. 1582-1585). Wife accepted her children's account without inquiry and then accused Husband of endangering the children by leaving them alone with strangers. At trial, Husband credibly testified that C. B needed her diaper changed. He told M. B and N. B he was going a short distance away to the bathroom to use the changing board. M. B and N. B were safely playing on their iPads while they waited for the food to arrive. Rather than bringing these two older children into the men's room, he asked the wait staff to mind them for a few minutes. The Court finds that given his available choices, Husband made an appropriate parenting decision. However, Wife took the children's "abandonment" story as true and used this narrative against him in this proceeding. She testified that the children were "really, really scared to be all alone in a restaurant in a strange place among all the strangers" (Tr. pgs. 921-924).
Wife fails to consider that after having been told this story, she could have explained to M. B and N. B that sometimes parents must make tough choices, that they were never truly "alone," that they survived the incident even if it scared them, and that their father loves them and would never intentionally endanger them. This alternative narrative would fulfill Wife's obligation to foster her children's relationship with their father. Instead, a considerable amount of trial time was spent hearing about an incident that amounts to nothing more than a typical parenting choice. This is just one of many examples where Wife has exaggerated otherwise innocent events and weaponized them into allegations of maltreatment against Husband. In [*24]making this observation, the Court does not concede that every allegation made by Wife originated from the uncoached mouths of her children, as she claims. The Court finds that they could have just as easily be falsely attributed to the children by Wife. Regardless, the original source of the stories is irrelevant as it is Wife who unnecessarily turns these "stories" into "allegations."
It is a parent's responsibility to guide their children, and when required, to challenge their perceptions of events. It is a custodial parent's job to question fanciful allegations made against the non-custodial parent, and not to support them blindly. Upon assessment, if the custodial parent realizes the stories are likely being exaggerated, then it is incumbent upon that parent to reassure the children that the non-custodial parent is a safe caretaker. In this case, it was Wife's responsibility to encourage the children to love and trust their father, not unreasonably fear him or hate him, simply because she blames him for their failed marriage. Obviously, Wife self- serving use of the two older children's allegations does not bode well for their future development.
Dr. Kaplan testified that in his opinion it is "empirically obvious" that M. B and N. B have been "alienated from their father." Given the complexity of parental alienation claims, the opinion of a forensic evaluator knowledgeable on the subject is highly useful. See Matter v. Gerber v. Gerber, 133 AD3d 1133 (3rd Dept. 2015). He believes the girls were "influenced by their mother" and that she "did not do anything, or enough, to correct the distortions the girls have about the father" (Tr. p. 1637). To the contrary, while Wife says she wants the children to have a relationship with the children, Dr. Kaplan stated that there was no other factor, other than parental alienation, that could cause the level of rejection of Husband exhibited by M. B and N. B (Tr. p. 1781). Dr. Kaplan further stated that because C. B is under the direct influence of her mother and older sisters, her relationship with her father is in jeopardy. See e.g. Zafran v. Zafran, 28 AD3d 753 (2d Dept. 2006)[the alienation of one child reasonably leads to a risk that other children will be alienated]. He identified a significant danger that over time C. B will align with her sisters in refusing to visit. For this reason, he stressed the urgency to "do something" to intervene and "stem the damage" before it gets worse. In this regard, Husband's post-trial application for an immediate change in custody, alleging that Dr. Kaplan's concerns are becoming reality, is very concerning (Mot. Seq. No. 020).[FN2]
There is evidence in the trial record that Wife's alienation has already affected Husband's access to C. B. As pointed out by Mr. Morisano, Wife has allowed M. B and N. B to act inappropriately during C. B's pickup and drop-off exchanges. Husband only has visitation with C. B, but on more than one occasion, Wife has allowed M. B and N. B to accompany her to the curbside pickup. In response to seeing their sister go, the two older children reacted hysterically, clinging and pulling on her and screaming and crying for her not to leave. On one occasion M. B and N. B screamed at their father telling him that "if [he] loved them, [he] would not take C. B away from them." On another occasion M. B and N. B attempted to pull C. B out of their father's car. Rather than intervening and encouraging M. B and N. B to join C. B on the visit, Wife allowed this tragic charade to continue without regard to the effect that it had on everyone [*25]involved, especially C. B. Compare, DiNapoli v. DiNapoli, 200 AD3d 1027 (2d Dept. 2021)[parental alienation not found where mother took steps to encourage reluctant children during visitation exchange]. Here, Wife's inaction contributed to the pattern of alienation as she stood idly by allowing M. B and N. B to traumatize C. B.
Considering her influence over M. B and N. B, it falls upon Wife to undo what she has done. If she is unwilling to do so, there is little chance of Husband reestablishing a relationship with these children. To date, Wife has taken no steps to remedy the situation other than offering platitudes about her unsuccessful attempts to talk to the children. Moreover, while Wife claimed to be encouraging visitation, she simultaneously adhered to a baseless trial posture that Husband poses a danger to the children. When asked how she would effectuate the access that she claims to be encouraging, Wife had nothing to say. Silence is woefully inadequate for a custodial parent, especially one who created this tragic situation. Indeed, Wife has never offered this Court a solution to the problem she has caused. Dr. Kaplan has suggested to Wife that intensive reunification therapy might be helpful, and this Court has encouraged the same, but to its knowledge, Wife still has taken no steps to enroll the children in such a program. As for enrolling herself in therapy, Wife maintains that she does not need therapy, but that Husband does, a position echoed by M. B and N. B.
Wife's position on therapy for herself and the children is troubling. See e.g. Matter of Halioris, 126 AD3d 973 (2d Dept. 2015). Regardless of how she assesses fault, Wife should perceive therapy as a way for her to learn strategies to help the children cope with the loss of a relationship with their father. She should also value professional intervention to gain learned insight into what caused the destruction of this once warm, loving relationship as she claims to be unaware. Family Reunification therapy is intended primarily for the benefit of the children, as they deserve to have a loving relationship with their father. Thus, Wife's resistance to the concept is even more insidious as it is detrimental to the welfare of the subject children. Moreover, if Wife feels unable to repair the rift, as she sometimes claims, she could have asked a mental health professional what actions could help remedy the situation. However, none of this happened. The Court finds that this is likely because Wife is not overly concerned about the children's relationship with their father. It appears she does not view his absence as much of a loss for them, other than a monetary one. Wife's disinterested view towards M. B and N. B's relationship with their father goes beyond inattention and reaches the point of actual interference.
In addition to implanting and encouraging M. B and N. B's negative view of their father, and failing to take remedial measures, the record establishes that Wife has taken affirmative acts to interfere with Husband's relationship with his children. Wife intentionally involved the subject children in the March 16 Incident rather than taking steps to protect them from it. See Matter of Nina P. (Giga P.) 180 AD3d 1047 (2d Dept. 2020). She then fostered their erroneous perception of the event (that Husband was the aggressor) and encouraged them to "forever remember" the event as she portrayed it. See e.g. Matter of Nwawka v. Yamutuale, 107 AD3d 1456 (4th Dept. 2013)[creation of false narrative of abuse supports a finding of alienation]. Early in this proceeding, when Husband still had visitation, Wife could not control herself from showing up, following them in her car, or driving by to check on them. Wife has used the children to convey her complaints about the financial aspects of the case and has commiserated with them about the loss of their "dream home" that their father took away from them. See Whitley v Leonard, 5 AD3d 825 (3rd Dept. 2004) [improperly involving children in divorce issues supports a finding [*26]of alienation]. Wife disparaged Husband in the children's presence when they lived together, during this proceeding, and even in the presence of Dr. Kaplan. See Matter of Smith vs. Francis, 170 N.Y.S.3d 195 (2d Dept. 2022). Finally, Wife has misused the judicial system to interfere with Husband's relationship with the children by filing a false police report against him, filing a frivolous family offense petition on the children's behalf, and filing baseless applications to suspend his visits during this proceeding. See Tyrone G. v. Lucretia S., 4 AD3d 205 (1st Dept. 2004).
Sadly, the affirmative actions taken by Wife before and during this proceeding, together with her inaction by failing to correct the children's false perceptions of their father proved successful. By the time the subject children appeared for their in-camera examination, they were fully alienated from their father and were more than willing to provide the Court with a list of rehearsed, but trivial, reasons why. They were unwilling to even consider that they once had a loving relationship with their father despite clear evidence that they did. The narrative they presented was simple: mom is good, dad is bad, and nothing that will ever change that.
Based on the evidence presented at trial, and after carefully considering the parties' testimony, including the in-camera examinations, and after considering the insightful testimony of Dr. Kaplan, and the positions of the attorneys for the subject children, this Court has no choice but to find that Husband has met his burden of proving that Wife has engaged in acts of parental alienation and that these acts and omissions have severely impacted his parental rights. See E.V. v. R.V., 165 AD3d 736 (2d Dept. 2018). The Court further finds that the pattern of conduct engaged in by Wife has severely impaired and damaged Husband's relationship with M. B and N. Band threatens to do the same to C. B. See Matter of Cooper v. Nicholson, 167 AD3d 602 (2d Dept. 2018); see also Sukul v. Sukul, 196 AD3d 661 (2d Dept. 2021). Wife failed to prove that the deterioration of the relationship between M. B and N. Band their father was in any way attributable to anything Husband did or failed to do. Compare, Pandis v. Lapas, 176 AD3d 837 (2d Dept. 2019).
This Court has attributed more weight to the issue of parental alienation than to any other single factor discussed herein. The Court finds that Wife has shown no interest or ability to restore Husband's relationship with M. B and N. B. Moreover, after very careful consideration, this Court finds that if C. B continues to reside primarily with her mother and sisters, she will align with their views and develop a similar antipathy and distorted view of her father.
(l) Continuation of the Status Quo/ Access to Siblings
Where practicable, the Court must consider the value in maintaining the custodial status quo, as to not unnecessarily disrupt the lives of children. See Matter of Peroglu v. Baez, 54 AD3d 416 (2d Dept. 2008). In addition, there is a strong presumption under New York law that siblings should remain together, unless the best interests of each child clearly lies with a different parent. See Klat v. Klat, 176 AD2d 922 (2d Dept. 1991). In this case, while the Court acknowledges these well-established principles, it finds itself constrained to reach a different conclusion for C. B.
Currently, all three children reside with their mother. Husband has no access schedule for M. B and N. B based on their steadfast refusal to see them. This Court has no choice in this case but to grant Wife physical residency of M. B and N. B because their allegiance to her is so strong that to remove them would likely endanger their health and safety. See Melissa C.D. v. Rene I.D., 117 AD3d 407 (1st Dept. 2014). In this case, both parents, all counsel, and the forensic evaluator agree with this result, although under ordinarily circumstances, Husband has made an [*27]extraordinarily strong case he is likely the better custodial parent for all three children.
The Court does not reach the same conclusion for C. B. While C. B has always lived primarily with her mother, she has consistently visited with her father. They enjoy a warm loving relationship with each other as they did prior to the March 16 Incident and the commencement of this divorce. Since this Court ordered Wife not to interfere, or let M. B and N. B interfere with Husband's pick up and drop offs, C. B transitions easily between her parent's homes. She enjoys spending overnights and weekends with her father and seeing her paternal relatives.
For these reasons, this Court finds that granting Husband sole legal and physical custody of C. B while continuing reasonable access to Wife will not be as traumatic to C. B as it would be for her sisters should custody of them be granted to their father. While this result will separate C. B from her sisters during the week, the Court finds that it is necessary under the circumstances. The three sisters will be able to spend time together during Wife's parenting time set forth below. Moreover, it is this Court's hope that if M. B and N. B see C. B having a good time with their father, perhaps they will become more open to reestablishing a relationship with him in the future. The Court finds that the separation of siblings is necessary to ensure that Wife's acts of alienation do not negatively impact C. B's relationship with her father.
Custody and Parental Access
When making the following custody and parental access determination the Court has considered the factors discussed above. With respect to M. B and N. B, this Court finds that Wife has engaged in acts of parental alienation so egregious that an award of sole custody to Husband would be justified on that factor alone. See Bobinski v. Bobinski, 9 AD3d 441 (2d Dept. 2004); see also Matter of Gerber v. Gerber, 133 AD3d 1133 (3rd Dept. 2015). Moreover, under typical circumstances, a consideration of the other relevant factors would make Husband a suitable custodial parent for all three children. However, as recognized by Husband, M. B and N. Bare so mired in their antipathy for him, that an award of physical residency to him would cause considerable psychological damage and endanger their welfare. See Melissa C.D., Supra.; see also Matter of Lew v. Sobel, 46 AD3d 893 (2d Dept. 2007); Matter of Sullivan v. Plotnick, 145 AD3d 1018 (2d Dept. 2016). Given Wife's conduct, and the effect it has had on the children's perception of their father, this Court has no choice as a practical matter but to award Wife sole residential custody of M. B and N. B.
While Husband concedes that he cannot have physical custody of M. B and N. B, he argues that the parties can still have joint legal custody of those children as offered by Wife. Typically, a final award of joint legal custody is not a viable option where the parties are antagonistic towards one another and have demonstrated an inability to cooperate and co-parent. See Matter of Lawrence v. Davidson, 109 AD3d 826 (2d Dept. 2013). However, if the Court were to reject joint legal custody as an option, an award of sole physical and legal custody to Wife would have to issue for M. B and N. B. The Court finds that such an award would reward Wife for her misconduct and would serve as a vehicle for Wife to cause even more damage by further excluding Husband from the children's lives.
For these reasons, and while the Court recognizes that joint legal custody would not typically be appropriate under these circumstances, this Court finds that joint custody for M. B and N. B is in their best interests. The parties are hereby directed to confer on all major decisions affecting M. B and N. B's life and to consider each other's position before any decision is made. However, to curtail any further marginalization of Husband, he shall be granted final decision- making authority in the sphere of "medical decisions" which includes all mental health services [*28]for the children including therapy. Wife shall have final decision-making authority in the sphere of "education" since sadly, she is the only parent able meet their daily educational needs. As both parents are of the same faith, religion as not been identified as a sphere requiring this Court's involvement.
This Court does not reach the same decision with respect to C. B. For the reasons set forth herein, and as the evidence at trial overwhelmingly demonstrates that Husband is by far the more fit custodial parent, largely due to Wife's alienation of the older children, Husband is hereby granted an order of sole legal and physical custody of C. B. See Matter of Ruiz v. Carie, 179 AD3d 1069 (2d Dept. 2020); see also Matter of Jones v. Leppert, 75 AD3d 552 (2d Dept. 2010); Matter of Honeywell v. Honeywell, 39 AD3d 857 (2d Dept. 2007). This award is in accordance with the application of C. B's attorney who "is genuinely fearful that if [Wife] is awarded custody of C. B, she will be at imminent risk of being alienated from [Husband]" (Morisano Sum., p. 10). In addition, the horrific acts of domestic violence committed by Wife against Husband while she was holding C. B during the March 16 Incident further supports an award of sole custody. See Matter of Clarke v. Boertlein, 82 AD3d 976 (2d Dept. 2011); see also Matter of Marcia ZZ v. April A. 151 AD3d 1303 (3rd Dept. 2017); Matter of Jermaine T. (Jairam T.), 193 AD3d 943 (2d Dept. 2021). Husband shall inform Wife of any major decisions that he intends to make relating to C. B but does not need to seek her approval or consent. Wife is granted parental access as set forth herein to ensure that C. B's bond with her sisters and her mother remains consistent.
Regarding Husband's access to M. B and N. B, this Court is sadly unable to order a set schedule of visitation. Husband shall have therapeutic visitation, in the form of family reunification therapy, as recommended by Dr. Kaplan. The court notes that at the conclusion of trial the parties agreed to start researching a qualified therapist and to begin visits as soon as possible. The parties have not advised the Court if they have complied with their stipulation, however, as Husband as filed an Order to Show Cause to switch custody of C. B while this matter was sub judice, it does not bode well. It is this Court's hope that intensive therapeutic intervention will resolve (over time) M. B and N. B's issues with their father. If that happens, the parties are hereby directed to enter into an access schedule that awards Husband considerable parenting time. If Husband believes that visits have become appropriate and Wife does not agree, then Husband shall have the right to petition this Court or the Family Court for parental access without the need to establish any change of circumstances.
As to C. B, this Court has considered her right to have access to her mother and siblings on a regular basis and weighed that right against the risk of alienation discussed at length herein. In his Summation, Husband suggests a schedule of access that he believes would be appropriate under the circumstances. This Court agrees that the schedule suggested by Husband would preserve the bond C. B has with her mother and sisters while protecting her relationship with her father. Husband suggests that Wife have unsupervised parental access with C. B on alternate weekends from close of school on Friday through 6:00 pm on Sunday and one weekday afternoon every week from close of school until 6:30 pm. Interestingly, this schedule is very similar to the visitation schedule that Wife suggested for Husband in her Summation. In fact, Husband has suggested Wife have more time than she had suggested for him. Accordingly, Wife cannot reasonably complain about being awarded more parental access than she was willing to give Husband had she prevailed on her applications.
After considering the factors above, this Court agrees with Husband's proposed schedule. [*29]Husband shall be responsible for dropping C. B off and picking her up from Wife's home when school (or daycare) is not in session. Also, when school is not in session, Wife's visitation shall begin at 3:00 pm which is consistent with the close of the school day. When school is in session Wife shall pick C. B up directly from school, but Husband shall remain responsible for picking her up curbside from Wife's home at the end of her visitation. Wife is ordered not to interfere, or permit the older children to interfere, in any of these exchanges. Wife's weekday "afternoon" visit will occur every Wednesday. This Court hopes that when the relationship between M. B and N. Band their father improves due to the therapeutic intervention ordered herein, the parties will agree to modify C. B's schedule as the alienation safeguards for her will no longer be needed.
Wife is hereby Ordered to attend personal therapy as a component of her visitation with C. B. Wife is further directed to inform her chosen therapist of the issues of alienation discussed herein. Although this Court is aware that this will be difficult for Wife given her aversion to mental health services, it is necessary if Wife has any desire to help M. B and N. B repair their relationships with their father. This mandated therapy is not a precondition to Wife's visitation, but a component thereof. See Matter of Bonthu v. Bonthu, 67 AD3d 906 (2d Dept. 2009); see also Matter of Thompson v. Yu-Thompson, 41 AD3d 487 (2d Dept. 2007). This shall be in addition to the family reunification therapy discussed above. Finally, Husband is hereby directed to enroll all three children in private therapy with a therapist of his choosing. See Resnick v. Zoldan, 134 AD2d 246 (2d Dept. 1987); see also Wolfson v. Minerbo, 108 AD2d 682 (1st Dept. 1985). As Husband has been granted the sphere of medical decision making (including therapy) for N. B and M. B, he can choose their therapist, although Wife is responsible for bringing them to all their appointments, regardless of any other matters on their schedule. Any unreimbursed cost related to the children's individual therapy, and the family reunification therapy, shall be shared pro rata by the parents as set forth herein (see "Child Support").
The parties shall alternate all the major holidays as set forth below. Holiday parenting time shall commence at 10:00 a.m. on the first day of the holiday or vacation period and shall conclude 9:00 p.m. on the final day of the visit unless otherwise specified below. If a conflict occurs between the normal parenting schedule and the holiday visitation schedule, the holiday visitation schedule will supersede normal parenting time. Holidays that fall on school days, such as Halloween, and C. B's birthday, shall commence at school dismissal and end at 9:00 p.m. In the event that this Court does not properly consider the relevant time frames for any religious holidays identified herein, the parties are encouraged to prepare a written stipulation modifying the schedule herein to properly observe those holidays. If they cannot, an application may be made to this Court.
Mother's Day shall always be with Mother and Father's Day shall always be with Father. Each parent shall have a total of two non-consecutive weeks of vacation with C. B during the months of July and August. One week shall be in July; the other week shall be in August. Each party shall designate by email their vacation weeks by May 1 of each calendar year or be subject to the other parent's choice of designated weeks. Wife, as the non-custodial parent, shall be granted first choice in the event that both parties seek the same weeks provided that she has timely designated her weeks in accordance herein.
The following secular and religious holidays will be alternated:
C. B's Birthday: even years: Wife / odd years: Husband
[*30]Thanksgiving: even years: Wife / odd years: Husband
Rosh Hashanah: even years: Husband / odd years: Wife
Hanukkah: normal visitation period shall apply, so long as it affords Wife at least one holiday weekend, if it does not, then Wife shall have an extra weekend visit that month during the holiday.
New Years Eve: even years: Wife / odd years: Husband
New Years Eve visit shall begin at 4:00 p.m. and end at 12:00 p.m. on New Year's Day.
New Years Day: even years: Husband / odd years: Wife
Martin Luther King Day: even years: Wife / odd years: Husband
President's Day: even years: Husband / odd years: Wife
Passover Seder: even years: Wife / odd years: Husband
Memorial Day: even years: Husband / odd years: Wife
Yom Kippur: even years: Wife / odd years: Husband
Shavuot: even years: Husband / odd years: Wife
Sukkot: even years: Wife / odd years: Husband
Fourth of July: even years: Husband / odd years: Wife
Labor Day: even years: Wife / odd years: Husband
Halloween: even years: Husband / odd years: Wife
Columbus Day: even years: Wife / odd years: Husband
Veteran's Day: even years: Husband / odd years: Wife Equitable Distribution
When determining the equitable distribution of marital property, the Court must consider the factors set forth in DRL §236(B)(5)(d). Before making the determinations herein, the Court has reviewed all of the enumerated statutory factors. This Court has included for discussion herein of only those factors that specifically apply to the facts of this proceeding. Accordingly, some factors were omitted while others were afforded minimal weight, if any, by this Court. Regarding tax implications, no evidence was offered by either party as to the likely tax impact of any potential award granted herein other than to the extent that Wife's failure to file her 2018 taxes is discussed below.
Specifically, in this case, the Court has considered the following factors: (a) the income and property of each party at the time of marriage, and at the time of commencement; (b) the award of maintenance to Wife herein; (c) the duration of the marriage and the age and health of both parties; (e) the probable future financial circumstances of each party; (f) the wasteful dissipation of assets by either spouse; and (g) acts of domestic violence committed by either party and the impact of said acts. See Santamaria v. Santamaria, 177 AD3d 802 (2d Dept. 2019).
Equitable distribution law is premised upon the theory that marriage is not only an emotional and physical union between spouses, but also an economic partnership. See Burke v. Burke, 175 AD3d 458 (2d Dept. 2019). "As such, during the life of a marriage spouses share in both its profits and losses." Ospina-Cherner v. Cherner, 178 AD3d 1059 (2d Dept. 2019). There is ample evidence in the trial record to support the presumption that everything acquired by either party during this ten-year marriage should be considered marital property regardless of how it is titled. See Nerayoff v. Rokhsar, 168 AD3d 1071 (2d Dept. 2019); see also DeLuca v. DeLuca, 97 NY2d 139 (2001). This was simplified by the fact that most of the parties' assets, [*31]such as the parties' business, were equally owned and jointly titled. No significant separate property claims have been asserted in this proceeding.
When considering issues of equitable distribution, the term "marital property" is to be construed broadly, while the concept of "separate property" is to be construed narrowly. See Price v. Price, 69 NY2d 8 (1986). "Were courts to engage in precise financial tracing, they would be paralyzed by divorcing parties seeking review of every debit and credit incurred during their marriage." Klauer v. Abeliovich, 149 AD3d 617 (1st Dept. 2017). Thus, the specific economic decisions made by the parties during the course of their marriage are not subject to review, rather, the Court must effectuate an equitable distribution of marital assets that exist when the action is commenced, taking into account all relevant factors. See Mahoney-Buntzman v. Buntzman, 12 NY3d 415 (2009). When a marriage is one of significant duration, where both parties have equally contributed to it, the distribution of assets should be effectuated as equally as possible. See Repetti v. Repetti, 147 AD3d 1094 (2d Dept. 2017); see also Miller v. Miller, 128 AD2d 844 (2d Dept. 1987).
Factors Considered (a) Income and property of each party at the time of the marriage and at the time of commencement
As no separate property has been identified during these proceedings, the first factor considered by this Court in determining an appropriate distribution of marital assets is the relative incomes of each party. A more complete discussion of the parties' comparative incomes can be found in relation to the issue of maintenance and child support below. However, for the purposes of equitable distribution, the Court finds that Husband has a higher income capacity than Wife, although not to the extent that she argues. During their best years, both parties earned seven figure incomes by taking equal distributions from YG. D LLC. However, this ended for both parties when the business lost profitability and ultimately closed. Currently Husband earns $220,000 to $250,000 a year and the Court finds that to be a fair reflection of his earning capacity. Wife earns no income as she is unemployed. The Court finds that Wife is certainly capable of working but has shown no interest in seeking employment to date.
There is no doubt that Husband's income is greater than Wife's for equitable distribution purposes. Accordingly, this factor weighs in favor of Wife when this Court determines each party's equitable share of their assets. However, the weight of this factor is mitigated by a consideration of the temporary maintenance awarded to Wife during the pendency of this action and the final award of maintenance herein.
(b) Maintenance Award
During this proceeding Wife received pendente lite maintenance in the amount of $3,000 per month. In addition, Husband was responsible for paying many of the carrying charges related to the home where Wife resides. For example, Husband has paid over $93,000 in rent on Wife's behalf during the course of these proceedings in addition to other expenses paid for her benefit. For the reasons detailed later in this Decision, this Court has granted Wife a final maintenance award in the sum of $3,239 per month or $38,366 per year. The award is payable for eighteen months. The amount and duration of this final maintenance award has been considered by this Court in determining how to equitably divide the assets identified at trial.
(c) Duration of the Marriage, Age and Health of the PartiesThe parties have been married since August 15, 2009. Accordingly, the parties were married ten years before this action was started. The Court finds that this is a marriage of [*32]moderate duration. Wife is 38 years old. Husband is 36 years old. Neither party complains of any health problems which would affect their earning capacity or that would require a larger distributive award than they would usually be entitled to.
(d) The Liquid or Non-Liquid Character of All Marital PropertyIn this case, there are few assets remaining to be distributed to the parties. The parties most significant asset, the West Fingerboard Road Property, has been liquidated and placed into escrow. Both parties will receive an equitable share of the bank accounts, investment accounts and the other accounts accumulated during the marriage. Accordingly, this factor weighs equally in favor of both parties.
(e) The Probable Future Financial Circumstances of the PartiesAs indicated above, Husband has a current earning capacity greater than Wife's and is gainfully employed while Wife remains unemployed. In terms of future earning capacity, both parties are of similar age, and both have earned bachelor's degrees. Moreover, after the distribution of liquid assets detailed below, Wife will have considerably more available resources than Husband. Balancing Husband's established earning capacity with the distribution of assets to Wife, the Court finds this factor to be equally balanced between the parties.
(f) Wasteful Dissipation of Assets by Either PartyA wasteful dissipation occurs when a party wrongfully reduces or extinguishes marital assets without a reasonable explanation, or with the intention of depriving the other spouse of that asset. See e.g. Wilner v. Wilner, 192 AD2d 524 (2d Dept. 1993); see also Mage v. Mage, 174 AD3d 884 (2d Dept. 2019). The party alleging the wasteful dissipation bears the burden of proving such waste by a preponderance of the evidence. See Marino v. Marino, 2020 NY Slip Op 02922 (2d Dept. 2020). While there is considerable discretion in what amounts to waste, a wasteful dissipation of assets generally does not occur when marital funds are utilized to pay legitimate expenses or used to fund failed investments absent evidence of wrongdoing. See Eschemuller v. Eschemuller, 167 AD3d 983 (2d Dept. 2018); see also Kohl v. Kohl, 24 AD3d 219 (1st Dept. 2005).
Wife claims Husband intentionally caused the demise of YG. D LLC. However, she offered no evidence to support her assertion. This Court credits the testimony of Husband as to market forces that caused the closure of this business. This Court further finds that Wife, as equal owner of this business and signatories on all relevant bank accounts, was fully aware of the challenges being faced by their business model and took no steps to help the business survive. Upon the commencement of this divorce proceeding, Wife abandoned control of YG. D LLC to Husband despite her equal ownership interest and even took steps to impair Husband's efforts find new clients. Accordingly, Wife has not established that Husband wrongfully dissipated their business.
In contrast, there is evidence in the record to find that Wife wrongfully dissipated assets. Shortly before she commenced this proceeding Wife withdrew over $600,000 from joint accounts and spent an exorbitant amount of that money on attorneys, some of which only represented her for a few days. In addition, Wife admittedly emptied the parties' joint safe deposit boxes and removed over $200,000 in jewelry along with approximately $10,000 in cash and an unknown number of gift cards. The jewelry, cash, and gift cards were last in Wife's possession and have never been recovered. While the Court was unable to value the gift cards, for equitable distribution purposes, it reaches the logical conclusion that Wife disposed of them in a way that benefited her. The same logic applies to the $10,000 in cash although neither party [*33]makes a claim for equitable distribution of the same at trial.
(g) Acts of Domestic ViolenceA considerable amount of discussion throughout this Decision has been dedicated to the March 16 Incident and its effect on Husband. While the consequences of Wife's actions are obviously related to parenting, they are also relevant here. The March 16 Incident served as the beginning of the end of Husband's relationship with his wife, and two of his three children. It resulted in his wrongful arrest and the commencement of a baseless Family Offense proceeding against him. Regarding YG. D LLC, Husband lost his 50% business partner and the support that Wife provided him. Moreover, he lost access to Wife's family members who were deeply involved in the business. As for other assets, Wife's spent at least $50,000 of the money that she wrongfully withdrew from joint accounts on criminal defense attorneys relating to her arrest following Husband's release from police custody. All of these events, and many others, can be traced back to Wife's conduct on March 16, 2019, and the fateful days that followed. Accordingly, the Court has considered this factor and finds that it weighs in Husband's favor.
Having considered the above factors, the Court will distribute the parties' marital assets as indicated below. In making its determination, the Court notes that this is a marriage of moderate duration and finds that the assets should be distributed as equally as possible. See Kamm v. Kamm, 2020 NY Slip Op 02465 (2d Dept. 2020); See Achuthan v. Achuthan, 117 N.Y.S.3d 667 (2d Dept. 2020). Although mindful that it will result in the loss of most, if not all of his liquid assets, Husband does not contest a 50/50 distribution. Wife, on the other hand, has identified a number of assets, such as the funds derived from the sale of the marital home, for which she wants more than a 50 percent share. Subject to the specific exceptions made below, the Court finds that an equal distribution of the parties' assets is an equitable one.
Distribution
1. GD. U LLC
In or around 2013 Husband and Wife's brother, D. I opened an online e- commerce company known as GD. U LLC. As the company was formed, as a partnership, during the marriage it is presumptively marital property. GD. U LLC was in the business of purchasing wholesale goods at discount prices and then reselling them through online sites such as E-Bay or Amazon. GD. U LLC was operational until 2019 when the party's marriage began to sour.
After this divorce was commenced, Husband sued Wife's brother to dissolve GD. U LLC. In August 2019, Wife's brother settled that litigation for $100,000 buying out all of Husband's interest in that company with an effective date of December 31, 2018. Thus, when the Court neutral evaluator valued the company, they found that it had no value on the date of commencement in April 2019. (Pl. Ex. 81). However, the settlement funds were presumptively marital property. Husband admits that he didn't distribute any of the settlement to Wife (Tr. p. 39). Accordingly, Wife seeks one half of the settlement amount ($50,000) in equitable distribution.
Husband admits that the funds he received are marital property and agrees that the Court should distribute the same. However, he argues that the proper sum for distribution is the net figure of $76,850 after the payment of "expenses" The trial record is devoid of information regarding these alleged expenses. Rather, the record supports a finding that Husband received a check for $100,000 from D. I that was deposited it into his personal Chase checking account (Tr. p. 469, Def. Ex. W.). Wife is hereby granted a distributive award in the amount of $50,000 for her interest in GD. U LLC.
[*34]2. YG. D LLC LLC
The history and operations of YG. D LLC are explored at length above. Suffice it to say the business was created in January of 2015, during the marriage, thus making it marital property. Typically, marital businesses are "owned and managed" by one spouse, with the non- titled spouse asserting a claim in equitable distribution based upon, inter alia, their direct contributions to the business or indirect contributions that support the business. See e.g. Kamm v. Kamm, 182 AD3d 590 (2d Dept. 2020); see also Culman v. Boesky, 2022 NY Slip Op 03440 (2d Dept. 2022). This is not the case here.
In this case, YG. D LLC is equally owned by the parties and has been almost since its creation. By the end of 2015, Husband had made Wife a 50% owner of the business and this Court finds that both parties were involved in its operation. While Husband admits that he made most of the important business decisions and worked considerably more hours than Wife did (Tr. pgs. 60-63), she played an active role and was aware of the business activities. Regardless of the comparable amount of effort put into the business, during their marriage Husband and Wife took equal distributions from the company. Wife ceased receiving equal distributions in 2019 although she took no affirmative steps to remedy this as a co-owner. Husband argues that he was justified in not continuing the 50/50 distribution since he had to pay pendente lite support, but that argument is without merit.
Both parties still continue to co-own the business equally to date although neither party currently has any active involvement with it. At trial Wife repeatedly speculated that Husband was still operating the business under a different name, but she failed to provide any evidence to support her allegation. Wife argues that Husband unilaterally ceased YG. D LLC's business operations and wrongfully allowed it to waste into a valueless asset. However, Wife fails to address what steps she took, as a 50% owner, to keep the business operational. Husband testified that he attempted to find new clients, but to no avail as the market had evolved. Although Wife had contact with many of the company's business associates and several of the computers were in her family members' homes, Wife failed to take any steps to save the business. Wife also failed to seek redress from this Court, such as the appointment of a business receiver, to assist her in maintaining the marital business if she were unable to do so.
Wife seeks a 50% distribution of the value of YG. D LLC as of the date of commencement ($2,772,000) and argues that Husband should be required to pay her half of that amount as a distributive award ($1,386,000). Husband argues that if Wife is entitled to a specific distribution, then he would be entitled to an equal distribution, with that sum being paid by the company, not by him. As both parties equally own the business this is not a situation where one party will retain title and buy the other out. In fact, both parties have clearly indicated that they have no desire to own and operate the company. The difference in their positions lie in that Husband seeks the dissolution of the corporation with its value (if any) to be equally split between the parties, while Wife implies that Husband should continue to own and run the business, and be compelled to buy out her interest, albeit at a historical value.
During these proceedings, YG. D LLC was valued at the request of the parties. The valuation was prepared by the firm Klein Liebman & Gresent LLC ("KLG"). In KLG's report, two possible values are suggested depending on the valuation date used. If the Court were to utilize a valuation date based upon the date of commencement, KLG concludes that the business had a value of approximately $2,772,000. However, if the Court were to conclude that a "present day" value was more appropriate, KLG concludes that the business had a value of $57,000. This [*35]amount reflects the value of the company in or around March 2020 based in part upon its ability to generate revenue at that time and considering its lack of marketability (Ex. 81, Pg. 6).
In her post trial Summation and Statement of Proposed Disposition Wife argues that, because the business is an active asset, it should be valued as per the date of commencement. See e.g. Daniel v. Friedman, 22 AD3d 707 (2d Dept. 2005). Wife claims that as YG. D LLC was wastefully dissipated by its "owner spouse" [implying Husband] it would be inequitable to "force the blameless spouse [implying Wife] to share in a portion of its loss" (Wife's Sum. p. 53). However, this argument ignores the fact that both parties are equal owners of the company and that to the extent that there is blame for the company's failure, that blame would be shared by both parties. In sum and substance Wife argues that as Husband wrongfully closed the business without "any attempt to sell or continue it" she should be compensated for one half of its value because of Husband's wrongful actions.
Husband credibly testified that neither party should be held "at fault" for the failure of YG. D LLC. Rather Husband argues that it was the nature of the business, and the changing trends of the internet advertising market that resulted in YG. D LLC's contracts not being renewed. Husband testified that he attempted to find new clients, but to no avail (Tr. p. 1563). Husband's attempts to revive the business were made more difficult by the fact that he was engaged in this bitterly contested divorce proceeding and was suffering the lingering effects of the March 16 Incident, including the ramifications of his false arrest and the alienation of his children. This Court credits Husband's testimony that he did not intentionally reduce YG. D LLC's profitability, and that the company's failure was primarily due to market forces. The Court also finds that while Husband made reasonable attempts to prolong the profitability of the company, Wife took no remedial actions whatsoever. Finally, the Court finds that there is no evidence in the record to support Wife's speculation that Husband has secretly continued the business "under an alias." Rather, the record supports a finding that Husband ceased his efforts to continue the company's operations in light of his financial obligations related to this divorce proceeding and obtained steady employment.
After considering the factors above the Court finds that while "active" assets, such as businesses, are frequently valued as per the date of commencement, to do so here would be inequitable. Formulations regarding when a particular asset is valued should be treated as guideposts and not immutable rules. See Grunfeld v. Grunfield, 94 NY2d 696 (2000). The trial court has broad discretion to select an appropriate date for measuring the value of property based upon the circumstances of the case. See Mesholam v. Mesholam, 11 NY3d 24 (2008). Here, the evidence at trial supports a finding that YG. D LLC ceased operations not because of a nefarious plan on the part of Husband to reduce his income, but rather because of "adverse economic forces." See Siegel v. Siegel, 132 AD2d 247 (2d Dept. 1987). As the loss in value had little to do with either party's actions, and more to do with forces beyond their control, a date of trial valuation is more appropriate. See Sagarin v. Sagarin, 251 AD2d 396 (2d Dept. 1998); see also Wegman v. Wegman, 123 AD2d 220 (2d Dept. 1986); Giallo-Uvino v. Uvino, 165 AD3d 894 (2d Dept. 2018); Breese v. Breese, 256 AD2d 433 (2d Dept. 1998). To the extent that either party's actions negatively affected the value of the company, the record supports a finding that it was Wife's actions, as she assaulted Husband on March 16, 2019, had him falsely arrested, commenced an action for divorce, and began alienating M. B and N. B at a time when Husband was trying to save the marital business.
Thus, for the reasons set forth herein the Court finds that the date of trial valuation [*36]offered by KLG in the amount of $57,000 is the most relevant measure of value available to this Court. While a more appropriate value would have been closer to the actual date of trial, after the business had fully ceased operations, KLG's representative, Mr. Gibralter, declined to speculate beyond the documentation provided to him (Tr. pgs. 1423-1424). The KLG Report does however address the possibility of closure. It indicates that in such an event the value of YG. D LLC would likely be the "fair market value of [its] net assets" (Pl. Ex. 81, p. 7). These assets were admittedly sold by Husband post commencement to keep the business afloat.
Having concluded that YG. D LLC was worth $57,000 as of March 2020, the Court must now determine what to do with that figure. Wife seeks a distributive award of one half of the value of the company. However, Husband correctly argues that he would be entitled to the same distribution as they both own equal percentages. Thus, the figure of $57,000 only becomes relevant if either party chooses to purchase the other party's interest and retain 100% ownership of the company (a "buy out"). In the event that either party elects to do so, they may declare their intention, in writing, within 60 days of this Decision and pay the sum of $28,500 representing the other party's one-half share. However, if neither party wishes to retain possession of YG. D LLC, or if they both do, then the parties shall cooperate in the formal process of dissolving the company and selling its remaining assets and goodwill with the proceeds of any such sale being evenly split between the parties after any company debts are paid. If the parties cannot cooperate on dissolution, Husband shall be responsible for the same with the right to file an application for reimbursement for any costs incurred including, but not limited to, the commencement of a dissolution proceeding.
2a. Unilateral Distributions to Husband from YG. D LLC LLC
It is undisputed that YG. D LLC was equally co-owned by the parties since 2015, however, Husband admits that Wife's involvement with the company ended when she commenced the present divorce proceeding in April 2019. It is further undisputed that during the course of their marriage the parties took equal distributions from the company as reported on their respective K1's from 2015-2018 (Pl. Ex's. 16-19). After that date, Wife abandoned her role in the company and left all business decisions to Husband. After unsuccessfully attempting to obtain new clients, Husband unilaterally began the process of shutting YG. D LLC down. He sold several business assets, primarily computers, and took unilateral distributions from the company without Wife's knowledge or consent. More importantly, for the first-time, equal distributions were not given to Wife. Wife now seeks one half of those post commencement distributions taken by Husband between 2019 and 2021.
At trial, Husband's testimony regarding the interaction between the YG. D LLC business bank accounts and his personal bank accounts was difficult to comprehend. The issue is further complicated because not all of the distributions were monetary in nature. Some distributions took the form of pre-paid gift cards, or Husband's personal expenses paid for by the company. Husband attempted to establish that most of the money he unilaterally distributed was used to operate YG. D LLC until it fully ceased operations. Wife's testimony offered nothing to clarify the nature and extent of the distributions as she abandoned the business completely after the commencement of this action.
In her written trial summation, and in her Statement of Proposed Disposition, Wife has identified several post commencement bank account transfers made from YG. D LLCs' business bank accounts to Husband's personal bank account. However, statements made in summation are not evidence and therefore cannot form the basis of a distributive award absent a connection to [*37]admissible evidence in the trial record. See Merenda v. Conrail, 248 AD2d 684 (2d Dept. 1998); see also Adamko v. Steinberg, 166 AD2d 547 (2d Dept. 1990). To support a distributive award, Wife had the burden of identifying the specific assets that she seeks distribution of, and their value, through admissible evidence. See Antoian v. Antoian, 215 AD2d 421 (2d Dept. 1995).
The first transaction identified by Wife occurred just before the commencement of this action in March 2019 when Husband transferred funds from a YG. D LLC business bank account ending in x7843 in the amount of $91,320 to his personal bank account. Husband did not give one half of this money to Wife. However, Husband credibly testified that he used it for business purposes and only transferred funds them into his personal account out of fear that Wife would drain the account. The Court credits Husband's testimony he used the funds to maintain the business (Tr. pgs. 433-434). Since the money was reinvested back into the business, it has merged into its value.
Wife also alleges that $15,602 was distributed to Husband from a different YG. D LLC account ending in x3881. However, there are no specific references to this transfer in either parties' trial testimony. A review of Plaintiff's Exhibit 43 reveals that YG. D LLC's bank account ending in x3881 had an ending balance of $15,602 in March 2019. However, in April 2019, that balance was comingled with several other deposits. Husband withdrew the entire account balance of $64,519 and deposited the same into his personal savings account from which he paid his personal expenses (x4912). Wife has failed to meet her burden of establishing that the specific sum of $15,602 should be subject to equitable distribution. Moreover, Wife does not seek one half of the $64,519 figure, which encompasses the $15,602.
To further complicate matters, Wife next seeks, as a separate asset, one half of the sum of $463,674 which represents allof the distributions taken by Husband from YG. D LLC in 2019, regardless of form. This sum is derived from a pair of 2019 K1 tax forms that were prepared in 2020 encompassing distributions taken in 2019 (Tr. p. 85). One K1 was issued in Husband's name for the sum of $373,706; the other was issued in Wife's name for the sum of $89,968(Pl. Ex. 20). Husband credibly testified that, after this action was commenced, YG. D LLC stopped distributing money to Wife even though she remained a 50% owner (Tr. p. 93). As such, Wife did not receive her one-half share of either of these K1 distributions, even though one was issued in her name. However, neither party has clarified why the distributions set forth on the respective K1 tax forms do not necessarily encompass the specific 2019 distributions discussed above. Those distributions were taken by Husband in 2019 and reported on his 2019 K1. Wife has not proven that there were improperly omitted from the tax documents. Accordingly, if the Court were to award Wife half of $15,602, or $64,519, while simultaneously awarding half of $463,674, it would result in the same money being awarded twice, causing improper double counting. See e.g., Pulver v. Pulver, 40 AD3d 1315 (3rd Dept. 2007).
As the party seeking equitable distribution of specific items, it is Wife's burden to identify and value any specific asset from which she seeks an award. See Elsayed v. Edrees, 141 AD3d 503 (2d Dept. 2016). Wife has not provided sufficient evidence to prove that all of the distributions taken by Husband in 2019 were not included in the $463,674 sum indicated on the parties' 2019 K1's. This amounts to a failure of proof of Wife's behalf. See Barnhart v. Barnhart, 148 AD3d 1264 (3rd Dept. 2017); see also Rudish v. Rudish, 150 AD3d 1291 (2d Dept. 2017). However, as the record supports a finding that Husband took unilateral distributions in both money and personal expenses from YG. D LLC in 2019 without sharing the [*38]distributions with Wife as a 50% owner, as was their established pre-divorce practice, Wife is entitled to a distributive award in the amount of $231,837, representing one half of $463,674.
The same theory discussed above applies to Wife's request for one half of the sum of $65,000 representing the sale of business assets, specifically computers, in 2019. At trial Wife attempted to prove, through an Affidavit Husband prepared in support of a pre-trial motion, that he wrongfully sold the business computers and "took the money." At trial Wife's attorney requested that Husband read a portion of that Affidavit where he admits the sale (Pl. Ex. 57, Para 9). However, if you read the balance of the Affidavit, Husband clearly indicates that "he" didn't sell the computers, YG. D LLC did. In fact, the trial record is plagued with confusion regarding whether Husband took actions on his own behalf, or on behalf of the YG. D LLC. In this circumstance, Husband's Affidavit goes on to explain that "without the revenues generated from the sale of company computer equipment, the fourth quarter profit [in 2019] would have been a fourth quarter loss of $55,000" (Tr. p. 450). The Court credits Husband's account that the computers were not sold for his own benefit, but rather for the benefit of the business. To the extent that Husband used any of the proceeds for personal expenses, those sums would have been recorded on his 2019 K1, which Wife did not prove was inaccurate.
In addition to distributions unilaterally taken by Husband in 2019, Husband took additional distributions from YG. D LLC without Wife's knowledge or consent in 2020. These expenses, which are recorded on a 2020 K1 issued in Husband's name, amount to the sum of $61,107(Pl. Ex. 21). Husband admits that he failed to share these distributions with Wife even though she continued to be a 50% owner and they had historically shared all distributions equally (Tr. pgs. 99-101). Thus, Wife is entitled to a distributive award in the amount of $30,554 representing one half of $61,107.
3. Tax Refunds and Estimated Payments
Wife requests that the Court equitably distribute certain tax refunds that she claims Husband received and failed to share with her. The first refund was received in 2021 and related to past overpayments of taxes to New York City. The amount of the refund was $37,791 and it was paid by a check issued by the NYC Department of Finance and made payable to YG. D LLC LLC (Pl. Ex. 44). This check was deposited into YG. D LLC's bank account (x3881) in March 2021 (Pl. Ex. 43.). The banking records show that the balance carried over to the next month of April 2021 when the money was used to make a payment to the IRS in the amount of $4,975 and a payment to American Express in the amount of $27,000 along with two credit card payments. The ending balance of the bank account in April of 2021 was $314. Thus, the money was not withdrawn by Husband, but rather was spent out of YG. D LLC's operating account.
At the time of these transactions, Wife was a 50% owner of YG. D LLC, however, she did not receive any part of the $37,791 return. Neither party has explained the nature of the April 2021 withdrawals and their relation to the tax refund check. Thus, it is impossible for this Court to determine if the withdrawals were for business purposes, or if they inured to the benefit of Husband, Wife, or both. When asked to opine on why he did not give one half of the refund to Wife, Husband indicated that he did not have a reason for not sharing it (Tr. p. 111). Thus, this Court finds that Wife is entitled to a distributive award equal to one half of the $37,791 refund check in the amount of $18,896.
In addition to the tax refund discussed above, Wife seeks equitable distribution of various "estimated tax payments" paid to the Federal and New York State for tax year 2018. Extensive testimony at trial was dedicated to the complicated way in which Husband paid future estimated [*39]taxes for the parties' benefit. Absent the testimony of an accountant, which was not offered by either party, it is difficult to understand how these payments were actually made and applied by the taxing authorities. The record was also confused by Husband's tendency to testify using approximate numbers. Wife's testimony failed to clarify the confusion as she claimed ignorance as to how her taxes were paid. What is clear is that both parties benefitted when they filed their taxes jointly. However, when Husband filed his 2018 taxes (in October of 2019) he chose to file "married filing separately" as Wife had already commenced the present action for divorce. Husband's total reported income on his 2018 tax return was $1,335,567(Pl. Ex. 10) which included income reflected on his 2018 K1 of $1,318,514. Wife failed to file a 2018 tax return although she had an identical K1 issued to her. Notably Wife was represented by counsel in April 2019 when she was required to file. As of the conclusion of trial, Wife has still not filed a 2018 tax return.
In September 2018, Husband used YG. D LLC funds to pre-pay a portion of the parties' estimated 2018 taxes. While his testimony on the subject was inconsistent, Husband's 2018 tax return indicates that he pre-paid the sum of $359,500 for himself. Husband credibly testified that he directed the company's accountant to set aside the same amount for Wife. In her post trial filings Wife seeks a distributive award of $359,500 arguing that she is entitled to the money set aside for her 2018 taxes so that she can file the same.
In relation to the estimated tax pre-payments for Wife, Husband credibly testified that $100,000 was improperly attributed to his taxes by the I.R.S. when Wife failed to file (Tr. p. 467). Accordingly, Husband admits that Wife is entitled to $100,000 as a distributive award. According to Wife's claim, this leaves a balance of $259,500. However, Husband credibly testified that to the best of his knowledge, he still has an "overpayment balance" with the I.R.S. in the amount of $290,000 that should be attributable to Wife's taxes (Tr. p. 487). Husband claims he never received a refund for these funds, and they remain in the possession of the federal government as unused prepaid taxes. Husband indicates that he is willing to assist Wife in any way that he can so that she can attribute those unallocated funds to her 2018 taxes
Accordingly, in total, Husband has identified $390,000(not $359,500), which was prepaid for Wife's 2018 federal taxes and not allocated to her by the I.R.S. because she failed to file a tax return for that year. When the $100,000 was attributed to Husband's taxes, it left a balance of $290,000 which is still being held by the I.R.S. Wife is hereby directed to file her 2018 taxes and Husband is directed to assist her in obtaining use of the $290,000 credit that remains on his I.R.S account. The use of this balance negates the necessity of a distributive award to Wife, which would be improper in any event as Husband never actually received a refund of those funds.
In addition to pre-paying Federal Taxes, Husband also used funds from YG. D LLC to prepay the parties' 2018 New York State taxes. When Wife failed to file her 2018 taxes Husband was issued a New York State tax refund check in the amount of $101,535 [FN3] (Pl. Ex. 39). Husband admits that these funds were properly attributable to Wife taxes, and thus has indicated he is willing to provide her 100% of the refund (Def. Sum. Pg. 58). Accordingly, Wife is hereby granted a distributive award in the amount of $101,535.
4. Bank and Investment Accounts
During trial, both parties identified various marital bank accounts, investment accounts and retirement accounts that were accumulated during the marriage and existed at the date of commencement. The parties established that they opened bank accounts at JP Morgan Chase, People's United Bank, Bank of America and Marcus by Goldman Sachs. They also opened an investment account at TD Ameritrade. Finally, the parties had three retirement accounts, two SEP IRAs with JP Morgan, and a 401K with Viacom.
The parties each seek fifty percent of the value of each of accounts as of the date of trial. While "passive" assets are typically valued as of the date of trial, bank accounts are typically valued as of the date of commencement if they are utilized by the parties during the pendency of the proceeding. See Rywak v. Rywak, 100 AD2d 542 (2d Dept. 1984); see also Graziano v. Graziano, 285 AD2d 488 (2d Dept. 2001); Michaelessi v. Michaelessi, 59 AD3d 688 (2d Dept. 2009). Here, the evidence at trial supports a finding that both parties deposited and withdrew funds from these bank accounts during the action, accordingly, date of commencement values will be utilized, unless otherwise indicated.
The present action was commenced by Wife on April 12, 2019. In March 2019, just before commencement, and clearly in anticipation of the filing of this divorce proceeding, Wife withdraw the entirety of the parties two largest bank accounts totaling $641,176. The bank accounts (x8028 & x7672) were located at JP Morgan Chase Bank. Wife withdrew an additional $5,800 in April of 2019 from the parties' Marcus by Goldman Sachs Account (x3232) for a total of $646,976. After commencement, when this Court became aware of the withdrawal, Wife was ordered to place $400,000 of the funds taken into her attorney's escrow account (See SFO dated June 12, 2019 [FN4] ).
When Wife was asked to explain why she withdrew the funds, her response was inconsistent and not credible. Wife first testified that she withdrew the money to save it for her children's education (Tr. p. 843). However, in the less than three months between the withdrawal date in March 2019, and the Short Form Order in June 2019 requiring her to place what was left in escrow, Wife managed to spend approximately $141,000. Wife testified that the money was spent on initial retainers to her first matrimonial attorney, Adam Edelstein Esq. in the amount of $25,000 and her first criminal attorney Joseph Corozzo Esq. in the amount of $25,000. However, only a few weeks later, Wife fired Mr. Edelstein and hired Raoul Felder Esq. at a retainer of $50,000. When asked how much she was refunded by Mr. Edelstein, Wife testified that she owed him an additional $3,000 for the legal work done in that single month. In the same three months, Wife also fired Mr. Corozzo and hired Mr. Steven Scaring Esq. at an additional $25,000 retainer to represent her in her criminal case. Despite this testimony Wife admitted a few moments later, while still on direct, that she charged the retainers above to her American Express Card and didn't actually use these funds (Tr. pgs. 849-850). When asked how spending $125,000 on attorneys in three months could be considered saving money for her children, she testified that "I knew I wasn't using it for their education, I was using it for their future because I am their mother" (Tr. p. 851). In addition to spending $125,000 on attorneys in three months, Wife testified that she spent the remainder of the funds not put into escrow on personal and household expenses.
The $400,000 placed into escrow will be discussed below, but based upon the facts [*40]above, Wife owes Husband a distributive award in the amount of $123,448 representing one half of the $246,976 not placed in escrow ($646,976 - $400,000 = $246,976 / 2 = $123,448).
Around the time Wife transferred $646,976 from joint accounts to private accounts in anticipation of this divorce, Husband engaged in similar withdrawals, albeit to a lesser degree. Husband admits that he withdrew the balances of his TD Ameritrade account in the amount of $4,602 together with the balance of this JP Morgan Chase savings account in the amount of $52,839. He also took an immediate disbursement from YG. D LLC in the amount of $91,320(which has been addressed above) out of fear that Wife would drain the business' operating account (Tr. p. 433). Husband admits that he owes Wife one half of the amounts withdrawn from TD Ameritrade and JP Morgan Chase. Accordingly, Wife is entitled to a distributive award in the amount of $28,721($4,602 + $52,839 = $57,441 / 2 = $28,721.)
In addition to the accounts addressed above, that were withdrawn in anticipation of this divorce, the parties also maintained a joint Bank of America checking account (x9016). In March of 2019, just before the commencement of this action the account had a balance of $15,455. By May 7, 2019, the balance of the account was $0(Pl. Ex. 32). Wife argues that the entirety of this account was taken by Husband for his own purposes and seeks one half of $15,455. Husband argues that they both withdrew from the account while admitting that an initial withdrawal in March 2019 in the amount of $5,000 was unilaterally his (Tr. pgs. 167-168). Upon review, the Court credits Husband's testimony to the extent that approximately half of the withdrawals from the account in April 2019 originated from Wife. Husband testified that the ATM withdrawals from Brooklyn banks in the total amount of $2,309 are Wife's while the ATM withdrawals from Staten Island banks in the total amount of $2,040 are his. The remaining withdrawals relate to family expenses such as healthcare and car payments. Thus, the Court grants Wife a distributive award in the amount of $2,500 representing one half of the $5,000 withdrawal, less one half of the difference in their ATM withdrawals ($135) for a net distributive award of $2,365 to Wife.
5. Retirement Accounts
In addition to the bank and investment accounts indicated above, both parties seek distribution of their respective retirement accounts. It is undisputed that the three retirement accounts maintained by the parties are wholly marital property. During trial the three accounts were identified as, a J.P. Morgan SEP IRA in Husband's name, A Viacom 401K in Husband's name, and a J.P. Morgan SEP IRA in Wife's Name. At or around the time of commencement Husband's IRA contained approximately $118,094 and his 401K contained $52,117. Wife's IRA contained approximately $116,114.
Husband testified that in April 2019 he withdrew the funds in his IRA to pay down his tax liabilities and admittedly did not share the funds with Wife (Tr. p. 151). However, Wife did the same. In January 2020 Wife withdrew the funds in her IRA and used the funds for personal reasons (Tr. p. 895). This Court finds that both parties were entitled to a one-half share of the funds withdrawn. As Husband's IRA exceeded Wife's IRA by the sum of $1,980 ($118,094 - $116,114 = $1,980) she is entitled to a distributive award in the amount of $990 representing one half of the difference of the sums withdrawn.
Likewise, in December 2020 Husband withdrew the balance of his Viacom 401k and converted it into an IRA account with TD Bank titled solely in his name. Wife is entitled to one half of the value of this account in the sum of $26,059. However, as the funds are still maintained in a tax-sheltered account, Wife is hereby directed to open an IRA in her own name [*41]so that the funds can be "rolled over" in kind to avoid penalties and taxes. If sufficient funds do not exist in the account to be rolled over, Husband shall be responsible for paying a distributive award equal to the difference.
Finally, while not listed in her various Statements of Net Worth, at trial it was established that Wife maintained a "high-yield" savings account with Sallie Mae. When asked about this account at trial Wife testified that it may have existed at the time of commencement, but that she didn't know that it existed, although it was titled solely in her name (Tr. p. 1150). Husband offered proof at that in April of 2019 the account contained $7,408(Def. Ex. BD). As with the other accounts each party is entitled to one half of this amount, so Husband is entitled to a distributive award in the amount of $3,704.
6. Jewelry
During the years that YG. D LLC was profitable the parties purchased a considerable amount of jewelry from high end stores such as Tiffany, Hermes, Rolex, and Cartier. Wife estimates the value of the Jewelry at approximately $260,000(Pl. Ex. 4) although a review of receipts reveals that the purchase price of the Jewelry was at least $375,000 (Def. Exs. AD, AE, AF). While the Preliminary Conference Order called for the marital jewelry to be appraised, it never was, as both parties testified that the jewelry went "missing" while arguing that the other is responsible for its disappearance. In her Statement of Proposed Disposition, Wife seeks a distributive award representing 100% of her estimated value ($260,000) while Husband seeks a distributive award in the amount of $187,251 representing an approximation of one half of the jewelry's purchase price.
Both parties testified as to how they believed the jewelry disappeared. Wife testified that in or around January 2019, when she anticipated that the parties' marriage might fail, she "removed" the jewelry from a joint safe deposit box at TD Bank and brought it home to hide it from Husband. Wife hid the jewelry, a stack of unused gift cards, and approximately $10,000 in cash in her closet in various bags and shoe boxes. In March 2019, when Husband was searching that same closet for C. B's passport, at Wife's request, he began looking through her shoe boxes, some of which contained the jewelry. While Wife stops short of admitting that she assaulted Husband because he was going to find the jewelry, but she admits that him getting close to discovering it led to an escalation of events. Wife testified "I was hoping that he doesn't know, but in my head, I knew that the jewelry was there" (Tr. p. 950).
Wife's physical assault of Husband, which started at least partially because she didn't want him to discover the hidden jewelry, ultimately resulted in the destruction the parties' marriage and Husband's relationship with his children, but Wife was successful in preventing him from finding the jewelry. Following the assault, Husband fled the house and only returned home once, on March 19, 2019, to bring a present for M. B's eighth birthday. Wife was not home when Husband arrived, and he left before she returned. Wife claims that when she searched the closet for the jewelry and cards that night they were "missing." This Court does not credit Wife's testimony. Rather this Court finds that Wife very likely still possesses the jewelry and gift cards. In any event, Wife admittedly removed the jewelry from the safe deposit box and wrongfully secreted it away from Husband. Accordingly, this Court finds that Wife owes Husband a distributive award equal to one half of its value.
Generally, the value of personalty must be proven at trial and a failure to do so precludes distribution. See Kiani v. Kiani, 197 AD3d 1168 (2d Dept. 2021). However, a party's admission as to value may be considered as evidence. See Ferina v. Ferina, 286 AD2d 472 (2d Dept. [*42]2001); see also Smithie v. Smithie, 122 AD3d 719 (2d Dept. 2014). Here Wife admits that the value of the jewelry was at least $260,000 accordingly Wife owes Husband a distributive award in the amount of $130,000. The Court finds that to use Husband's approximation of value, which was based upon the aggregate purchase price of the jewelry, would ignore the concepts of "retail markup" and "depreciation." See e.g., Keane v. Keane, 25 AD3d 729 (2d Dept. 2006).
7. Real Property
During their marriage, the parties owned and sold two parcels of real property. The first property was located at *** Alan Loop and was purchased early in the parties' marriage for the sum of $440,000. This property was sold in 2017 to Wife's brother, with the profits from the sale, approximately $150,000, being deposited into a joint account. Neither party identifies the sale proceeds as a specific asset to be considered for equitable distribution. Despite having sold the property, the parties continued to reside therein while they waited for their "dream home" to be renovated. While they resided in Alan Loop the parties' paid rent to Wife's brother. Wife continues to reside in that property to date and allegedly continues to pay rent.
The second property obtained by the parties, which was intended to be their "dream home" was located at West Fingerboard Road. It was purchased on June 12, 2017, for the sum of $920,000. The parties primarily used distributions from YG. D LLC to fund the purchase. Soon after purchasing the home, the parties invested an additional million dollars to tear the property down and re-build it to their specifications. This extensive renovation was funded primarily through distributions taken from YG. D LLC including pre-paid American Express Gift Cards which were used to buy materials and pay contractors. The parties' plans were interrupted by the March 16 Incident and the subsequent commencement of this divorce action. As of the time of commencement, the property did not have a Certificate of Occupancy. During pre-trial litigation this Court ordered both parties to cooperate in having the house construction completed to make it habitable and increase its value (SFO 12/2/19). However, Wife failed to comply with this Court's Orders citing various concerns regarding the General Contractor's integrity and alleging that he was somehow giving kickbacks to Husband. Ultimately, the General Contractor and the subcontractors quit and ceased construction before the house could be completed.
In or around April 2021 both parties expressed that this ongoing proceeding was causing them severe financial distress. Husband offered a solution, requesting that the West Fingerboard Road property, which was vacant and unoccupiable, be sold "as is" to fund the parties' personal expenses and obligations related to this proceeding. By Order dated April 27, 2021, this Court granted the parties thirty days to submit a stipulation resolving the distribution of the vacant property, or it would be sold. As the parties failed to come to an agreement regarding the property it was placed on the market for sale. Once the property was listed Wife became an obstructionist, seeking to hinder the sale both by non-cooperation and motion practice. Wife's tactics resulted in Husband having to file various motions seeking authority to act without her participation. Ultimately, the house was sold for $1.8 Million dollars which netted the sum of $896,487 after the payment of the outstanding mortgage in the sum of $526,698, an American Express Judgment in the amount of $181,923, and other fees and costs related to the sale.
The payment of this American Express Judgment has become a point of contention between the parties. Husband credibly testified that the Judgment was entered against himself and YG. D LLC in relation to balances due to American Express when YG. D LLC ceased operations. Wife argues that she should be entitled to a "credit" related to the Judgment because she was unaware of it until after it was paid, and that the monies owed were related to Husband's [*43]personal expenses not marital expenses. Wife's position is not supported by the record. To the extent that Wife was unaware of the Judgment, it was primarily due to her lack of participation in the sale process and the abandonment of her role in YG. D LLC's affairs. Moreover, the record supports a finding that the American Express Gift cards were routinely utilized for both parties' expenses, for the renovation of the West Fingerboard property, and for business expenses related to YG. D LLC of which Wife is a 50% owner. The record further supports a finding that Wife was fully aware of what the gift cards were being used for and didn't object to the same until after the commencement of this action. This Court finds that the Judgment was properly paid at closing from joint funds as a marital debt to be shared equally by the parties (See "Marital Debt").
Ultimately the proceeds from the sale of *** West Fingerboard Road were deposited into Husband's attorney's escrow account. The distribution of the funds in that account will be addressed below. However, to the extent that Wife seeks an unequal distribution of the proceeds of the property sale (60%/40%) that application is denied. Rather, the Court finds that an equal distribution (50%/50%) of the remaining sale proceeds is warranted. See Matter of Motta v. Motta, 145 AD3d 560 (1st Dept. 2016); see also Alleva v. Alleva, 112 AD3d 567 (2d Dept. 2013).
7a. Post Commencement Renovations
As indicated above, when the present action was commenced on April 19, 2022, the house located at *** West Fingerboard Road was under construction. In the early stages of this proceeding Husband made certain payments towards the continued renovation of the house out of his own "post commencement" funds either by check, or by his personal credit card.[FN5] Husband argues that these improvements to the property inured to the benefit of both parties when the property sold, such that he should be entitled to a distributive award in the sum of $67,591 representing one half of the $135,182 that he alleges he spent.
In support of this claim Husband has offered a summary of post commencement expenses which was partially redacted by stipulation (Def. Ex. AP). The line-item expenses identified in this summary were not adequately explained by either party at trial (Tr. pgs. 478-480). Notably,it appears that only five of the entries [FN6] were clearly "post-commencement" the others having occurred before April 19, 2019. These five unexplained entries total to $29,538.
To the extent that the Court credits Husband's testimony that these expenditures were post commencement improvements to the West Fingerboard Road property, he still failed to meet his burden to establish his entitlement to a distributive award. The law of this State has long considered renovations (generally utilized as a separate property appreciation theory) as not warranting a "dollar for dollar" credit. See Price v. Price, 69 NY2d 8 (1986). Instead, the value of renovations is generally considered in accordance with any "increase in market value" directly related to those renovations. See Linda D. v. Theo C., 96 AD3d 432 (1st Dept. 2012); see also, Bernholc v. Bornstein, 72 AD3d 625 (2d Dept. 2010).
Here, Husband has failed to establish a nexus between the post-commencement separate property funds he invested in the West Fingerboard Road property and any increase in value to that property. See Gordon v. Anderson, 179 AD3d 402 (1st Dept. 2020); see also Karas- Abraham v. Abraham, 69 AD3d 428 (1st Dept. 2010). Accordingly, the Court finds that he is not entitled to a distributive award due to a failure of proof.
8. Escrow Accounts
As indicated above, the sale proceeds of West Fingerboard Road in the amount of $896,487 were deposited into Husband's attorney's escrow account. Earlier in this proceeding Wife was directed by Order dated June 12, 2019, to deposit the sum of $400,000 into her attorney's escrow account. This sum represented the remaining balance of the $646,976 Wife withdrew from joint accounts just before commencing this action. These two combined sums, together with smaller sums deposited during the proceeding [FN7] totaled approximately $1,319,972 of marital funds.
During the course of these proceedings, various orders were issued directing the parties to withdraw sums from escrow.[FN8] Among other expenses, the escrow funds were used to pay the business evaluator, the forensic evaluator, the subject children's attorneys' fees, court transcripts, therapeutic visitation expenses, and counsel fees to both parties' attorneys. In addition, when Husband fell behind on his pendente lite obligations, the escrow account was utilized to pay arrears. Finally on joint application the parties were each "advanced" equitable distribution in equal sums with each party receiving $95,000 and their respective attorneys each receiving $125,000 in counsel fees (SFO 1/13/22). Each of the expenses withdrawn from escrow were allocated between the parties in specific percentages, with those percentages made "subject to reallocation" at trial (see "Reallocation" below).
In their Written Summations and post-trial Statements of Proposed Disposition, both parties have provided an accounting reflecting the sums deposited into and withdrawn from escrow. Husband's lawyer asserts that the escrow account currently contains $441,422 while Wife's lawyers asserts that the account contains $440,203. In support of their respective accountings, both parties have provided an excel chart illustrating the various withdrawals from escrow and how they were initially allocated. Upon comparison with this Court's Orders and the Trial Record, the Court finds Wife's attorney's accounting to be a more complete and accurate representation (Pl. Sum. pgs. 80-82).
As these funds held in escrow amount to the most significant asset owned by the parties, the Court finds that each party is entitled to an equal (50%) share thereof. See Spencer-Forrest v. Forrest, 159 AD3d 762 (2d Dept. 2018). However, this equal distribution is subject to the various expenditures taken out of the account during this litigation and how they were initially allocated, or reallocated, herein (See "Reallocation" below). As the total sum placed into escrow was $1,319,972, an equal distribution results in an award of $659,986 to each party. As detailed by Wife's attorney, and supported by the trial record, Husband was initially allocated $524,821 [*44]in pendente lite withdrawals from escrow while Wife was allocated $354,948. However, as indicated below, this Court has reallocated various expenses resulting in the sum of $466,466 in withdrawals being attributed to Husband and $413,303 being attributed to Wife. When these withdrawals are deducted from the original 50/50 award of $659,986 it results in the following distributions from the amount currently held escrow. Husband is entitled to a distributive award in the sum of $193,520 and Wife is entitled to a distributive award in the sum of $246,683.
9. Escrow Refund
Subsequent to closing on their house sale, Chase Bank issued a check payable to both parties in the sum of $3,336 representing a return of escrow funds relating to the mortgage. The check was issued on May 15, 2020 and was deposited into Husband's People's United Bank Account on September 1, 2020. Wife seeks one half of this refund. Husband admits that he did not share the funds with Wife but indicated that he did not believe the check ever cleared (Tr. pgs. 161-162). In fact, a review of the corresponding banking statement from September 2020 indicates that the check was rejected by the bank [FN9] and Husband was charged a $15 service charge for the failed transaction. It is unclear from the balance of the record what, if anything, happened to these funds that were seemingly owed to the parties. However, as the record does not support a finding that Husband ever successfully deposited the check into his account, it would be inequitable to charge him with the payment of a distributive award representing the same. Rather the Court declines to distribute the refund check based upon a failure of proof that the funds were ever actually received. If the check is ever reissued by Chase Bank, it is to be shared between both parties equally.
10. California Closets
During the renovation of their home the parties engaged the services of a company known as "California Closets" to install custom closets throughout the house. The parties paid somewhere between $70,000 and $90,000 for their services. California Closets began installation work before the March 16 Incident, but Husband discontinued their services after the commencement of this proceeding. As such Husband testified that the parties have a $10,000 store credit with the company, but that he is not sure how it can be utilized (Tr. p. 1870). Husband admits that half of this credit belongs to Wife. Accordingly, both parties shall be entitled to use $5,000 of this credit in accordance with the terms and conditions of their contract with California Closets. If a refund may be issued in accordance with the contract, it is to be issued 50% to each party.
11. Gift Cards
A considerable amount of trial testimony was dedicated to the purchase and use of gift cards during the parties' marriage. As discussed above, YG. D LLC initially purchased gift cards for use as a "reward" for people who clicked the company's ads when browsing the Internet. However, as YG. D LLC began to rely more upon automatic "clicks" to generate income, the parties' use of gift cards changed. In or around 2018 the parties began taking distributions from YG. D LLC in the form of pre-paid American Express gift cards (that were not otherwise available as "rewards") and used them for everything that a person would use currency. Wife testified that she used the pre-paid cards at the dentist and for shopping, while Husband testified that he used them to pay the contractors who were renovating the West Fingerboard Road [*45]property. At the closing when the West Fingerboard Road property was sold, a judgment was paid in the amount of $181,923 reflecting a debt owed to American Express by YG. D LLC for the purchase of these cards. The distribution of that debt is addressed above.
In her post trial Summation and Statement of Proposed Disposition, Wife seeks a distributive award in the amount of $173,807 representing one half of $347,614 which she claims to be the value of the gift cards "taken by Husband." Wife claims she is entitled to this amount, without much explanation, to compensate her for (1) the reduced net proceeds paid at the closing of the West Fingerboard Road property and (2) her share of the prepaid cards that she never received (Pl. Sum. p. 70.).
The trial record does not support the distribution sought by Wife. As indicated above, this Court has found that both parties were equally aware of the purchase and use of gift cards during the marriage and equally benefitted from their use. The decrease in net proceeds of the sale of the West Fingerboard Road property due to the American Express Judgment paid at the closing is addressed above. To the extent that Wife seeks a distributive award due to cards "she never received" the Court finds this statement too speculative to form the basis for equitable distribution. Wife does not indicate if she is referring to the physical cards that she hid along with the marital jewelry, or the benefit from the cards used by the parties which is addressed herein. If she is referring to the gift cards that she hid, the Court finds that she likely remains in possession of those cards. Moreover, the value of any gift cards taken as disbursements from YG. D LLC in 2019 were necessarily addressed in the distributive award related to Husband's 2019 K1 above. Wife has failed to establish her burden of proof through non-speculative evidence that she is entitled to a distributive award in any specific amount relating to "gift cards she never received." See Fu Kuo Hsu v. Hsuan Huang, 149 AD2d 405 (2d Dept. 1989); Barnhart v. Barnhart, 148 AD3d 1264 (3rd Dept. 2017).
12. Personalty/ Motor Vehicles
In addition to the jewelry distributed above, the parties, but particularly Wife, purchased designer clothes and handbags from luxury stores such as Chanel and Hermes during the marriage. Husband possessed a few gold and silver coins although he could not remember where they were. The parties purchased high end furnishings, some imported, for the Alan Loop and West Fingerboard Road properties that remain unaccounted for. In addition to the jewelry hidden in her closet, Wife testified that she had also hidden physical gift cards there, but that she didn't care much about them (Tr. p. 968). These items, together with others mentioned at trial, are all arguably valuable marital assets that would be subject to equitable distribution, however this Court finds itself unable to distribute the same.
The Court finds that this personalty was not identified at trial with any specificity as to identity and value such that a distributive award to either party can be considered. See Fu Kuo Hsu v. Hsuan Huang, 149 AD2d 405 (2d Dept. 1989); see also Butler v. Butler, 256 AD2d 1041 (3rd Dept. 1998). The same is true for the parties' motor vehicles, which while discussed tangentially at trial were never identified as specific assets with specific values. It appears from statements in the record that the vehicles were likely leased, not owned. Accordingly, the Court finds that there is a mutual failure of proof regarding the specific existence and value of any personalty other than the jewelry addressed above. Thus, each party shall be entitled to keep the personalty in their possession and each party shall be granted exclusive use of the vehicle that they currently drive. However, in so ruling the Court notes that Husband was forced to leave the former marital home under the false pretense that he was the aggressor in the March 16 Incident [*46]and as a result he was forced to abandon most of his possessions in the house. Moreover, most of the designer clothing and handbags were purchased for Wife's use. Accordingly, Wife will gain considerably more by this ruling than Husband will.
13. Miscellaneous
This Court has undertaken a thorough review of the parties' post-trial submissions, the voluminous documentary evidence offered at trial and over two thousand pages of trial record to make the distribution of the parties' property as complete and equitable as possible. However, the trial record admittedly makes passing references to other equitable distribution claims that are not specifically addressed herein. The Court finds that any claim for equitable distribution not specifically addressed herein is hereby denied due to a failure of proof. When determining equitable distribution, it is the burden of a party who seeks the distribution of an asset to specifically identify that asset and provide evidence as to its value. See Nacos v. Nacos, 168 AD3d 413 (1st Dept. 2019). The Court finds that after an exhaustive review, all other equitable distribution claims raised by the parties are hereby denied due to a failure to meet their respective burdens of proof. See Hand v. Hand, 196 AD3d 469 (2d Dept. 2021); see also Antonian v. Antonian, 215 AD2d 421 (2d Dept. 1995); Post v. Post, 68 AD3d 741 (2d Dept. 2009).
14. Marital Debt
Just as assets accumulated during a marriage are subject to equitable distribution so are marital debts. See Barra v. Barra, 191 AD3d 831 (2d Dept. 2021). Expenses incurred prior to the commencement of an action for divorce are marital debt to be shared equally by the parties upon an offer of proof that they represent marital expenses. See Bari v. Bari, 200 AD3d 835 (2d Dept. 2021). Husband has not identified any debts to which he seeks contribution from Wife. Wife on the other hand, makes a convoluted argument as to how an American Express Judgment in the amount of $181,522 should be attributed 100% to Husband. This debt, which was levied against the West Fingerboard Road Property and paid at closing has already been determined to be marital in nature and distributed equally (See "Real Property").
Other than this American Express debt, neither party has identified specific marital debts that existed at the commencement of this action of which they seek distribution. While Wife's post-trial submissions make passing references to "credit card debt," the exhibits offered at trial do not establish the existence of particular sums of marital debt that would be subject to equitable distribution. Rather, the credit card statements offered at trial substantially refer to debts incurred after commencement (Pl. Exs. 48-52). The relevant time period for equitable distribution ends when the marital partnership ceases at the commencement of a divorce action. See Heyman v. Heyman, 102 AD3d 832 (2d Dept. 2013). Expenses incurred after the commencement of a divorce action are the responsibility of the party who incurred them. See Prince v. Prince, 247 AD2d 457 (2d Dept. 1998). Accordingly, the Court finds that both parties shall be responsible for any debts currently owed in their own name.
Maintenance
Wife seeks an award of maintenance in the amount of $ 7,714 per month, or $92,568 per year, for "at least five years" based on an imputed income to Husband of $500,000 and attributing no income to herself. Wife's maintenance claim was first raised in her Summons with Notice dated April 12, 2019. As such, any award would be retroactive to that date. See Crane v. Crane, 264 AD2d 749 (2d Dept. 1999); see also Hendry v. Pierik, 78 AD3d 784 (2d Dept. 2010). Wife admits that the statutory guidelines for determining the duration of maintenance [*47]suggest that she should be entitled to no more than fifteen to thirty percent of the parties' ten- year marriage, a span of eighteen to thirty-six months. See DRL §236(B)(6)(f). Despite this advisory schedule Wife seeks a term of five years arguing that she needs this amount and extended duration to allow her to maintain the lifestyle that she enjoyed during the marriage and prepare for her future. Husband acknowledges his presumptive obligation to pay maintenance but asks that the award be eliminated or reduced as a penalty for the severe acts of parental alienation found by this Court above.
As this action was filed in April of 2019, the recent statutory revisions [FN10] to the determination of post-divorce maintenance apply. In essence, the statutory revisions apply the well-established "temporary maintenance" guidelines to any claim for post-divorce maintenance. Thus, the determination of maintenance, at least in the first instance, has been simplified to a mathematical calculation. See DRL §236(B)(6). The result of this calculation is the presumptively correct award of maintenance that "shall" be paid to the less monied spouse unless the court finds the amount to be "unjust or inappropriate." See Mahoney v. Mahoney, 197 AD3d 638 (2d Dept. 2021); see also Hughes v. Hughes, 198 AD3d 1170 (3rd Dept. 2021). If the Court wishes to deviate from the guidelines, it is directed to consider "one or more" of the fifteen enumerated factors set forth in DRL §236(B)(6)(e)(a-o) and explain its reasoning. See Caputo v. Caputo, 152 AD3d 643 (2d Dept. 2017).
The first step in determining the presumptive maintenance award is to determine each spouse's income, up to the statutory income cap which is presently $203,000. See Lesser v. Lesser, 203 AD3d 466 (1st Dept. 2022); see also JTP v. SJ, 163 N.Y.S.3d 793 (Sup. Ct. NY. Cty. 2022). In determining income for the purpose of calculating maintenance, the statute uses the same definition of income as set forth in the Child Support Standards Act. See DRL §236B [5-a][b][4]. The Court is directed to utilize income figures as they were, or should have been, reported on the parties most recently filed tax returns. See DRL' 240(1-b)(b)(5)(i); see also Toscano v. Toscano, 153 AD3d 1140 (2d Dept. 2017). However, the Court is not bound by the parties' representation of their finances and has the authority to impute income where such a finding is supported by the record. See Cazar v. Browder, 191 AD3d 837 (2d Dept. 2021).
As discussed at length above, the parties earned high six to seven figure salaries in calendar years 2016-2018 through income and distributions taken from their jointly owned company YG. D LLC LLC. In 2016 both parties received K1's indicating income of $807,668, and the parties filed a joint tax return indicating gross income of $1,839,404. In 2017 both parties received K1's indicating income of $1,842,234, and the parties filed a joint tax return indicating gross income of $3,905,849. In 2018 both parties received K1's indicating income of $1,318,514, and Husband, for the first time, filed a separate tax return indicating gross income of $1,335,567. Wife failed to file a tax return for 2018. In late 2018 early 2019, Wife abandoned her role in YG. D LLC ceding control of the business to Husband. At or around the same time, the business started to fail. Husband's 2019 tax return indicated income of $196,365 and his 2020 return indicated income of $182,582. No other tax returns for Husband have been provided to the Court. Wife failed to file taxes in 2018 or 2019 but did file a 2020 return showing income of $130,620 representing the liquidation of her SEP IRA.
When Husband filed his 2020 tax return YG. D LLC had ceased operations and Husband had obtained employment with a company known as "Seeking Alpha."[FN11] However, in 2021 Husband once again changed employment and began working as the Vice President of Operations for "Secret Box Distribution Group." Husband's gross salary at Secret Box is approximately $220,000 a year with a possible performance-based bonus of $30,000.
In support of her claim for maintenance, Wife argues that it would be appropriate to impute the sum of at least $500,000 to Husband based upon his past income and demonstrated earning potential. Citing the income history detailed above Wife claims that Husband intentionally caused YG. D LLC to fail to reduce his income for purposes of this Divorce proceeding. This assertion, often relied upon my Wife, is completely unsupported by the record. Husband credibly testified that the failure of YG. D LLC was due to market forces beyond the parties' control, and that the attempts that he made at reviving the company were hindered by Wife. Moreover, the Court notes that Husband was burdened with saving the company at a time when he was dealing with the ramifications of the March 16 Incident including his false arrest, the commencement of the present divorce proceeding and the costs associated with it, and the alienation of his children. While Husband could historically rely upon Wife's support as a spouse and business partner, that support disappeared at a time when the business was already struggling to survive.
Even if the Court were persuaded by Wife's position, which it is not, the same theory of imputation would arguably apply to her. In every year that YG. D LLC was profitable Wife earned the same amount of income as Husband as they were both 50% owners. In 2019, Wife abandoned her role in the company and took no steps to revive it which is tantamount to the same allegation that she makes against Husband. Moreover, while Husband moved on to gainful employment after YG. D LLC ceased operations Wife has not sought employment to date. Finally, to the extent that Wife claims to be a homemaker who "sacrificed her career" to raise children and take care of the household (Tr. p. 938), the findings of intentional acts of parental alienation made by this Court against Wife make this argument less than persuasive.
Accordingly, the Court declines to impute income to either party based upon their past income or established earning potential, which was equal. As Wife remains unemployed, her income for the purposes of calculating maintenance shall be zero ($0). While imputation is not warranted, the computation of Husband's income is more complicated. Generally, the Court is directed to utilize the income indicated on a party's last filed tax return, and to deduct from that amount certain allowable taxes (FICA, Medicare, and local NYC tax) that were "actually paid". See Khaira v. Khaira, 93 AD3d 194 (1st Dept. 2012); see also Johnson v. Johnson, 172 AD3d 1654 (3rd Dept. 2019). However, Husband has admittedly obtained employment where he earns at least $220,000 a year, a salary considerably higher than that reported on his 2020 tax return. Under these circumstances there is authority to utilize the most recent income information available. See Matter of Lynn v. Kroenung, 97 AD3d 822 (2d Dept. 2012); see also Matter of Dailey v. Govan, 136 AD3d 1029 (2d Dept. 2016).
In addition to his credible testimony regarding income, Husband has provided a monthly "Earnings Statement" which was admitted into evidence (Pl. No. 23). This income statement, [*48]which covers the period from August 1, 2021 to August 31, 2021, indicates that he earned $18,333 gross. This figure, when annualized, is consistent with Husband's trial testimony regarding his current income. In addition, the earnings statement indicates the sums that Husband paid towards statutorily deductible taxes. Husband paid $1,137 in Social Security tax, $267 in Medicare tax, and $735 in local NYC tax. When annualized, Husband has established that he will pay $13,644 in Social Security, $3,204 in Medicare, and $8,820 in NYC taxes for a total sum of $25,688. When these sums are deducted from his $220,000 income, it results in an adjusted income of $194,332 for support calculations herein. See Castello v. Castello, 144 AD3d 723 (2d Dept. 2016); see also Frei v. Pearson, 244 AD2d 454 (2d Dept. 1997).
Calculations
Under the post-divorce maintenance guidelines, the Court is required to compare three calculations using the parties' annual incomes. The direction to utilize either the first or second calculation is dependent upon whether the party paying maintenance (the "payor") is also required to pay child support. The presumptive award of maintenance shall be the lower of either the first or second calculation (whichever applies), as compared to the third calculation.
In the present case, Husband is the party obligated to pay maintenance and is also required to pay child support for two of the three subject children. While for reasons set forth below that child support payment is being suspended, it remains his statutory obligation for the purpose of calculating maintenance as the suspension was caused by Wife's conduct and may be revisited when Husband's parental access resumes. While this appears to be a matter of first impression, the Court finds that the opposite result would reward Wife with a higher maintenance award for alienating the two of the three subject children from their father. For this calculation, the Court is required to subtract 25% of the payee's income from 20% of the payor's income. Here, Husband's income is $194,332 and Wife's income is $0. After applying the parties' respective incomes with the above arithmetic, the Court finds that the calculation results in an award of $38,866 a year.
For the third statutory calculation, the Court is required to add the payor's income and the payee's income and multiply the combined sum by 40%. The payee's income is then subtracted from this figure. Here, the parties' combined income is $194,332. Multiplying this figure by 40%, the calculated figure is $77,733. When Wife's income of $0 is subtracted from the combined amount the Court finds that the second calculation results in the sum of $77,733 a year. As the Court is directed to utilize the lower of the two calculations, the presumptive amount of guidelines maintenance is $38,866 a year or $3,239 a month.
Deviation
Husband argues the Court should deviate from this presumptive amount and reduce Wife's presumptive maintenance award to zero. Husband argues that the elimination of maintenance is warranted because Wife has completely alienated two of the three subject children from him. As addressed at length herein, this Court is seriously concerned by the parental alienation that has taken place in this proceeding. However, the Court feels that the remedy sought by Husband is more applicable to the issue of child support, which can be used as an incentive for Wife to rectify the situation, than it is to maintenance. Maintenance, once established, cannot easily be modified and thus a reduction in maintenance payments would be purely punitive, and would not serve as an incentive. Notably, the three cases cited by Husband [*49]in support of his request all relate to child support awards, not maintenance awards. See e.g., Sullivan v. Plotnick, 145 AD3d 1018 (2d Dept. 2016).
As the Court is utilizing the presumptive amount of maintenance, which "shall" be granted unless it is found to be inappropriate, there is no need for a lengthy discussion of the deviation factors set forth in DRL §236(B)(6)(e)(a-o). However, the Court has considered those factors and concluded that the presumptive award of maintenance is sufficient under the circumstances. Specifically, the Court has considered (a) the age and health of the parties; (b) the present or future earning capacities of the parties; (c) the standard of living established during the marriage; (d) the equitable distribution of marital property; and (e) domestic violence.
"The overriding purpose of a maintenance award is to give the receiving spouse economic independence." See Pandis v. Lapas, 176 AD3d 837 (2d Dept. 2019). The Court finds that the presumptive maintenance award is sufficient to maintain the standard of living Wife has enjoyed through most of the parties' 10-year marriage. See Wasserman v. Wasserman, 66 AD3d 880 (2d Dept. 2009). Other than the three aberrant years between 2016 and 2018 when the parties earned seven figure incomes, the record supports a finding that the parties lived a typical middle-class lifestyle. During those three "boom years" the parties purchased high end designer clothing and jewelry, and began the construction of their dream home, but as set forth above, the party's luxurious lifestyle abruptly ended before it could be enjoyed. Notably, for the last three years Wife has become accustomed to receiving $3,000 a month in pendente lite maintenance, which is $239 less than the amount being awarded now.
When determining the adequacy of the presumptive maintained award, the Court has also considered the fact that Wife is receiving a considerable equitable distribution award. As set forth herein (see "conclusion"), Wife will be receiving all the parties' liquid assets held in escrow (approximately $440,203), together with an additional distributive award in the amount of $117,389 and a $26,059 IRA rollover. The presumptive maintenance award, together with a considerable equitable distribution award, should be more than sufficient to maintain Wife until she can become self-supporting. See Grumet v. Grumet, 37 AD3d 534 (2d Dept. 2007); see also Alexander v. Alexander, 116 AD3d 472 (1st Dept. 2014). Moreover, the maintenance award represents a fair balance between a sum sufficient to support Wife while falling within the range of what Husband should reasonably be able to pay given his own expenses. See Mangino v. Mangino, 2016 AD2d 369 (2d Dept. 1995).
Finally, when considering the age, health, education, and earing capacities of the parties the Court finds that they are similarly situated. The parties are of similar age, neither has testified as to any health issues that would prevent them from working, and they both have Batchelor's Degrees. The only difference between Husband and Wife in this regard is their desire and drive to find employment. Wife takes the position that she cannot work because she must take care of the three subject children. However, two of the three children are school age, and Husband has been granted primary physical custody of the third, which should free her to work at least part time. See Sorrentino v. Sorrentino, 116 AD2d 564 (2d Dept. 1986). But perhaps more importantly, if Wife were able to share her parenting responsibilities with Husband, by reversing the alienation that she caused, she would have additional time to work. To the extent that Wife argues that her employment search has been hindered by the need to care for N. B and M. B, that is a problem of her own making. Husband remains ready willing and able to share in the parenting duties for all three children.
After considering the above factors, the Court concludes that the presumptive [*50]maintenance award is sufficient to support Wife while she takes steps towards becoming self- supporting and is a fair balance between what Wife needs and what Husband can reasonably pay. See Gordon v. Gordon, 113 AD3d 654 (2d Dept. 2014); see also Carroll v. Carroll, 125 AD3d 710 (2d Dept. 2015).
Duration
Having determined the amount of maintenance the Court must now determine a proper duration. The duration of maintenance is a matter committed to the sound discretion of the trial court. See Rennock v. Rennock, 203 AD3d 675 (1st Dept. 2022). For actions commenced after January 16, 2016, there is statutory guidance related to the duration of a maintenance award, however it is to be considered advisory. See DRL §236(B)(6)(f)(1); see also Harris v. Schriebman, 200 AD3d 1117 (3rd Dept. 2021). In addition to the advisory schedule, the Court is directed to consider the duration factors set forth in DRL 236(B)(6)(e) when determining the duration of a maintenance award. See Gutierrez v. Gutierrez, 193 AD3d 1363 (4th Dept. 2021).
The statutory guidance towards duration indicates that the award of maintenance should be between eighteen and thirty-six months. In addition, the Court has considered the following factors when determining a proper duration of the maintenance awarded: (a) the age and health of the parties; (b) the present or future earning capacities of the parties; (c) the need of one party to incur education or training expenses; (d) the standard of living established during the marriage; and (e) the equitable distribution of marital property. These same factors are discussed in relation to the amount of maintenance above.
After considering those factors the Court finds that, in accordance with the statutory guidelines, Wife should be awarded prospective maintenance for a period of eighteen months. In so ruling the Court notes that Husband has been paying pendente lite maintenance in the amount of $3,000 a month since June 2019.
In addition to basic support, Husband has also been responsible for the payment of Wife's rent pendente lite (SFO 6/12/19). Wife's testimony regarding her rent obligation was inconsistent at best. At all times during this proceeding, Wife has resided in a property which is owned by her brother. On cross examination Wife testified that when this action commenced in 2019 the rent was $1,850 but that it raised to $2,550 in January 2020 (Tr. p. 1138). But this testimony contradicted her prior testimony where she indicated that the rent increased to $2,515 in January 2020 (Tr. p. 533). Moreover, Wife's second Statement of Net Worth, sworn to as of March 2020 indicated that the rental amount remained $1,850(Pl. Ex. 3). Wife's third Statement of Net Worth, sworn to in July 2020 indicates the $2,550 figure (Pl. Ex. 4), but her post trial Summation returns to the sum of $2,515(Pg. 43).
Regardless of the actual amount of rent paid at any given time, it is undisputed that all rent paid in this proceeding was paid by Husband. Thus, when considering both direct support and rent, Wife has already received over three years of direct and indirect support in an amount significantly greater than the award of maintenance granted herein. When the eighteen months of post-divorce maintenance is added to the support paid pendente lite, Wife will have received a total amount of support far in excess of both the statutory guidelines for both amount and duration.
The Court finds that durational maintenance for an additional eighteen months should provide sufficient time for Wife to become self-supporting. Notably, the primary childcare [*51]responsibly for C. B will be with Husband, and M. B and N. B are school age. See D'Lorio v. D'Lorio, 135 AD3d 693 (2d Dept. 2016). To the extent that Wife seeks to obtain vocational training or return to school, the Court finds that both the amount and duration of the award are sufficient for that purpose. See Ferraro v. Ferraro, 257 AD2d 596 (2d Dept. 1999). The duration should provide a sufficient amount of support while still serving as an incentive for Wife to re-enter the workplace. See Granade-Bastuck v. Bastuck, 249 AD2d 444 (2d Dept. 1998). The award of maintenance will terminate upon the death of either party, Wife's remarriage, or at the end of its duration. See DRL §236(B)(6)(c); Gold v. Gold, 276 AD2d 587 (2d Dept. 2000). The award of maintenance herein is to be considered all-encompassing of Husband's support obligations towards Wife, thus he shall no longer be required to pay Wife's rent, or any other specific expense on her behalf.
Retroactivity
A party's maintenance obligation commences, and is retroactive to, the date the application for relief was first made which in this case was April 12, 2019. See DiLascio v. DiLascio, 170 AD3d 804 (2d Dep. 2019). When calculating retroactivity, the payor spouse is entitled to a credit for any pendente lite payments made pursuant to court order. See D'Iorio v. D'Iorio, 135 AD3d 693 (2d Dept. 2016). Credits are also appropriate for any payments made to third parties on the recipient spouse's behalf or for their benefit (such as carrying charges, rent, utilities, or similar payments). See Yunis v. Yunis, 94 NY2d 787 (1999).
The award of post-divorce maintenance herein, to wit, $3,239 a month, is payable retroactive to the filing of Wife's Summons with Notice. Accordingly, from April 2019 to September 2022, Husband owes 42 months of support at $3,239 a month for a retroactive total of $136,038. However, on June 12, 2019, this Court issued a Pendente Lite Order that required Husband to pay $3,000 a month in temporary maintenance, along with Wife's rent and any condominium related fees (SFO 6/12/2019). At trial, Wife's rent was established to be $1,850 in 2018 and then raised to either $2,515 or $2,550 in January or July of 2020 (see above).
There is no evidence to indicate that Husband is currently in arrears of any of his pendente lite obligations. When Husband began to fall behind in his payments in 2021, the Court authorized the payment of these undisputed arrears from the funds held in escrow to be taken from his share (SFO 4/27/21). To prevent the accumulation of further arrears, the Court modified the Pendente Lite Order directing Husband to pay the sum of $4,500 a month in direct support and authorizing the balance of $1,500 to be withdrawn from Husband's share of the funds held in escrow (SFO 9/24/21). These orders were made subject to reallocation at trial (see "Reallocation" below).
Considering first the payment of direct support, Husband has paid $3,000 a month in interim maintenance for 40 months totaling to the sum of $120,000. When this sum is subtracted from the retroactive figure of $136,038 it results in a retroactive award of $16,038. However, the Court is also directed to consider payments made on Wife's behalf when determining the issue of retroactivity. See Yunis v. Yunis, 94 NY2d 787 (1999). While the exact figures are unclear, it is undisputed that Husband paid Wife's rent since June 12, 2019. Crediting Wife's approximations for the purposes of retroactivity, Husband paid $1,850 a month in rent on Wife's behalf between June 2019 and January 2020 (7 months) totaling $12,950 and then paid at least $2,515 a month from January 2020 to the present (33 months) totaling $82,995. In total, Husband has paid at [*52]least $95,945 in rent for Wife. If half of this sum is considered maintenance, and half child support, then Husband is entitled to a retroactive maintenance credit of $47,973($95,945 / 2) which exceeds the remaining retroactive award of $16,038. Notably, while these calculations result in an overpayment of $31,935, Husband is not entitled to recoup any excess payments as recoupment would violate public policy. See Johnson v. Chapin, 12 NY3d 461 (2009); see also Rader v. Rader, 54 AD3d 919 (2d Dept. 2008).
Child Support
Both parties seek an award of child support for the subject children who reside with them. As per this Decision, Husband has been granted custody of C. B. Wife has been granted custody of M. B and N. B. Accordingly, both parents are presumptively entitled to awards of child support. In "split custody" situations, where the subject children are separated between two households, the Court must determine the basic child support obligation on a per household basis with the controlling percentage for each home determined according to how many children reside there. See Scomello v. Scomello, 260 AD2d 483 (2d Dept. 1999); see also Matter of Ross v. Manley, 135 A.D. 1104 (3rd Dept. 2016); Burns v. Burns, 70 AD3d 1501 (4th Dept. 2010).
The Child Support Standards Act sets forth the method by which the "presumptively correct" amount of child support can be calculated. See Domestic Relations Law §240; Family Court Act §413. A three-step process is required by the relevant statutes. The first step requires a calculation of the "combined parental income" up to a statutory cap, currently $163,000. See NY Soc. Serv. Law §111-i(2)(b). The second step requires the Court to multiply the combined parental income by a specified percentage based upon the number of children. The third step is only triggered when the combined parental income exceeds the statutory cap. Once the statutory percentage is applied to the parties' combined income, and each party's pro rata contribution to that amount is determined, the resulting sum is presumptively the correct amount of child support.
As child support must be determined in both directions in this split custodial arrangement, two sets of calculations are required. As indicated above, Husband has been awarded sole custody of C. B. The correct statutory percentage to be applied to the parties' combined parental income for one child is 17%. See Matter of Hipp v. Ryan, 188 AD3d 1206 (2d Dept. 2020). Application of this percentage to the combined parental income will provide the appropriate level of support to meet the basic needs of that child.
This Court has already determined that Husband's income is $220,000 based upon his credible testimony regarding current salary (See "Maintenance"). From this amount, the Court must deduct certain statutory taxes (FICA and local NYC taxes) that were "actually paid" See Khaira v. Khaira, 93 AD3d 194 (1st Dept. 2012); see also Johnson v. Johnson, 172 AD3d 1654 (3rd Dept. 2019). This results in an adjusted income of $194,332 for the purpose of calculating child support. While Wife's income is zero ($0) from employment, Wife has been awarded $38,866 per year in maintenance. This amount is deducted from Husband's income and added to Wife's income when calculating child support. See DRL §240(1-b)(b)(5)(iii); see also Castello v. Castello, 144 AD3d 723 (2d Dept. 2016); Rouis v. Rouis, 156 AD3d 1198 (3rd Dept. 2017).
After subtracting the prospective maintenance award of $38,866, Husband's adjusted income for child support purposes is $155,466. After adding the same maintenance award to [*53]Wife's income, her adjusted income for child support purposes is $38,866. The combined parental income is therefore $194,332. However, when calculating CSSA child support, there is a statutory cap limiting the parties combined income. See DRL §240(1-b); see also Koutsouras v. Mitsos-Koutsouras, 198 AD3d 630 (2d Dept. 2021). The statutory cap is presently $163,000. When determining how to address income above the statutory cap the Court is directed to consider a number of factors including: (1) the financial resources of the parents; (2) the physical and emotional health of the children; (3) the standard of living the children would have enjoyed if the marriage had not dissolved; (4) whether one parent's income is considerably greater than the others; and (4) any extraordinary expenses that will be incurred by the non- custodial parent is exercising visitation. See DRL §240 (1-b)(f); see also Park v. Park, 193 AD3d 1065 (2d Dept. 2021); Matter of Peddycoart v. MacKay, 145 AD3d 1081 (2d Dept. 2016).
In determining whether to utilize income above the cap the Court has considered the statutory factors and makes the following findings. Both parties have sufficient financial resources to support the children in their care. Husband's resources are derived from his employment, while Wife's are derived primarily from the equitable distribution and maintenance awards herein. On balance, Wife is in the better "short term" financial position as she has been granted substantially all the parties' liquid assets. The physical and emotional health of the children has been damaged due to the severe parental alienation caused by Wife. As a result of this alienation Husband will likely be required to spend considerable funds towards repairing the relationship through expensive reunification therapy. In addition to therapy, future litigation presents as a likely expense that Husband may have to undertake to pursue his right to visitation. Regarding the standard of living enjoyed by the subject children, there is no evidence in the record to support a finding that they lived anything beyond a middle-class lifestyle. While their parents earned a considerable amount of money during the three-year period that YG. D LLC was profitable, there is no evidence that this prosperity noticeably changed the children's standard of living. There is no evidence to show that the children were taken on vacations, were engaged in expensive extracurricular activities, or otherwise benefitted from their parent's short- lived wealth. Accordingly, after specific consideration of these factors, and a general consideration of the other factors set forth in DRL §240, the Court finds that an application of the statutory cap of $163,000 without utilization of income above that cap is appropriate. See Marino v. Marino, 183 AD3d 813 (2d Dept. 2020); see also Hepheastou v. Spaliaras, 201 AD3d 793 (2d Dept. 2022).
As there is one child (C. B) residing with Husband, the applicable child support percentage is 17%. The capped combined parental income is $163,000. Seventeen percent of the combined parental income is $27,710. This figure represents the parties' combined child support obligation for C. B. Husband's pro rata share of this combined child support amount is 80% and Wife's share is 20%. Twenty percent of $27,710 is $5,542 which is Wife's annual child support obligation for C. B. Her monthly obligation is $462.
The other two subject children of this marriage, M. B and N. B, reside with Wife. She is presumptively entitled to an award of child support pursuant to the CSSA guidelines. The statutory percentage for two children is 25%. Twenty-five percent of the parties' combined income is $40,750. This figure represents the parties' combined child support obligation for N. B and M. B. Husband's pro rata share of this combined child support amount is 80% and Wife's share is 20%. Eighty percent of $40,750 is $32,600, which is Husband's presumptive annual child support obligation. His presumptive monthly obligation is $2,717.
[*54]Deviation / Suspension
Husband seeks a deviation from his presumptive child support obligation based upon the severe parental alienation caused by Wife that has resulted in the destruction of his relationship with M. B and N. B. Husband acknowledges that he has an obligation to pay support for his children but argues that his obligation should be suspended until such time as he can have "meaningful" parental access, including overnight visitation, with M. B and N. B.
One of the primary responsibilities of a custodial parent is to foster a relationship between the non-custodial parent and the subject children. See Matter of Lawlor v. Eder, 106 AD3d 92 (2d Dept. 2013). The failure to do so, is a factor to be considered when determining parental access, but when that failure rises to the level of parental alienation it becomes "an act so inconsistent with the best interests of the child as to, per se, raise a strong probability that the offending party is unfit to act as the custodial parent." Matter of Khan v. Potdar, 185 AD3d 822 (2d Dept. 2022).
Generally, the proper remedy when parental alienation is substantiated is a switch in custody. See Matter of Krier v. Krier, 178 AD3d 1372 (4th Dept. 2019). However, when the alienation is so thorough that a switch in custody would cause harm to the children, another remedy must be applied. Sadly, this is the situation here. Under these unfortunate circumstances, the only available alternative remedy is the suspension of child support to entice Wife to take steps to reverse the alienation. See Matter of Fielder v. Fielder, 189 AD3d 1231 (2d Dept. 2020). Such a suspension is warranted when a custodial parent's actions rise to the level of deliberate frustration or active interference with the noncustodial parent's parental access rights. See Matter of McNichol v. Reid, 176 AD3d 713 (2d Dept. 2019).
As discussed earlier in this Decision, Wife has actively interfered in Husband's relationship with M. B and N. B. The alienation arguably began when Wife intentionally involved the subject children in the March 16 Incident and continued throughout this litigation in numerous ways. Ultimately, Wife's actions resulted in M. B and N. B exhibiting hatred for their father without being able to articulate a credible reason why. Other than offering lip service to the concepts of "joint custody" and "shared parenting" Wife has taken no steps to repair her children's relationship with their father, and instead has fostered and nurtured their unfounded beliefs and fears. Under these circumstances, the Court finds it appropriate to temporarily suspend Husband's obligation to make future child support payments. See Matter of Sullivan v. Plotnick, 145 AD3d 1018 (2d Dept. 2016); see also Matter of Thompson v. Thompson, 78 AD3d 845 (2d Dept. 2010); Matter of Coull v. Rottman, 131 AD3d 964 (2d Dept. 2015); Rodman v. Friedman, 112 AD3d 537 (1st Dept. 2013); Matter of Dobies v. Brefka, 83 AD3d 1148 (3rd Dept. 2011).
This suspension of child support payable to Wife for M. B and N. B is not intended to be punitive. Rather, it is an incentive to encourage Wife to take affirmative steps to repair the relationship between these children and their father. See e.g. Matter of Lew v. Sobel, 46 AD3d 893 (2d Dept. 2007). To this end, Wife should follow the guidance offered by Dr. Kaplan, including supporting the children's participation in intensive reunification therapy, engaging in her own individual therapy and complying with this Court's Orders in this regard. The resumption of visitation between M. B and N. B and their father shall be considered a sufficient change in circumstances to allow Wife to petition this Court for the child support award to be reinstated.
With respect to Wife's child support obligation for C. B, Wife is entitled to a recalculation of the same upon a showing of (1) a substantial change in circumstances; (2) an increase or decrease of 15% in either parties' income; or (3) three years passage of time from the issuance of the Judgment of Divorce incorporating this Decision after Trial. See Matter of Vetrano v. Vetrano, 177 AD3d 890 (2d Dept. 2019). Husband shall have the same rights if visitation resumes, and his child support obligation is reinstated.
Retroactivity
Child support awards are generally retroactive to the first time that they were affirmatively requested. See Crane v. Crane, 264 AD2d 749 (2d Dept. 1999). A review of the official court file reveals that that Husband made his first application for child support in his pre- trial Statement of Proposed Disposition which was filed on August 4, 2021. See Beach v. Beach, 158 AD2d 848 (3rd Dept. 1990). However, as Husband has not had primary residential custody of C. B at any time during this proceeding, the Court finds that a retroactive award of child support is unwarranted. See Santamaria v. Santamaria, 177 AD3d 802 (2d Dept. 2019).
Wife seeks a retroactive award of child support. While Wife's alienation of M. B and N. B has resulted in Husband's future child support payments being suspended, the issue of retroactivity must still be addressed as his obligation to pay support was not suspended pendente lite. Wife first requested child support in her Summons with Notice dated April 12, 2019, and she has had primary residential custody of all three children throughout the course of this litigation.
In their post-trial summations, neither party makes a compelling argument as to how the Court should address the issue of retroactivity considering the parties' changing incomes. After considering the totality of the circumstances, the Court finds it equitable to calculate Husband's retroactive child support obligation based upon his 2021 adjusted income of $194,332. The Court finds this figure to be a fair approximation of his true earning capacity. However, the Court has adjusted Wife's income to $36,000 as she received $3,000 a month in pendente lite maintenance. While this slightly modifies the parties' combined income, that figure is irrelevant as the $163,000 cap remains imposed. However, Wife's modified income results in new pro rata split of 81% to Husband and 19% to Wife. As Wife has continuously had residential custody of the three subject children pendente lite, the correct child support percentage is 29%. See Beroza v. Hendler, 109 AD3d 498 (2d Dept. 2013). Twenty-nine percent of $163,000 is $47,240. Husband's pro rata share of this combined child support amount is 81% which equals $38,264 a year or $3,189 a month.
Accordingly, from April 2019 to September 2022, Husband owes 42 months of child support for all three children at a rate of $3,189 a month for a total retroactive amount of $133,938. During this proceeding, Husband has paid pendente lite child support in the amount of $3,000 a month for 40 months totaling $120,000. When this credit is deducted from the retroactive award of $133,938, a balance due of $13,938 remains owed by Husband. However, as indicated above in the discussion of maintenance, Husband also paid the rent where the subject children resided pendente lite, one half of which has been apportioned as child support herein. The main purpose of child support is to provide shelter, and therefore, payments towards that purpose must be credited. See Damon v. Damon, 34 AD3d 416 (2d Dept. 2006). When Husband is credited for the pendente lite payment of rent in the amount of $47,973(full rent of [*55]$95,945 / 2) it results in a retroactive overpayment by Husband of $34,035. While public policy prohibits Husband from seeking recoupment of the overpaid child support, this analysis makes clear that a retroactive award is certainly not warranted. See Matter of McGovern v. McGovern, 148 AD3d 900 (2d Dept. 2017).
Child Support Add-Ons / Health Insurance
Wife seeks an Order directing Husband to maintain health insurance for the subject children until they are emancipated. Wife also asks that Husband be held responsible for the payment of his pro-rata share of the children's unreimbursed medical, dental, orthodontia, psychological and pharmaceutical expenses.
At trial, Husband credibly testified that his current employment does not provide health insurance. However, Husband has been maintaining COBRA health insurance for the benefit of himself, Wife, and the subject children at a monthly cost of approximately $3,300(Tr. pgs. 145- 146). Once a Judgment of Divorce is signed, Husband shall only be responsible for paying for a basic health insurance plan for Wife for the duration of his maintenance obligation herein, or until she is able to obtain health insurance through employment, whichever comes first. See Papakonstantis v. Papakonstantis, 163 AD3d 839 (2d Dept. 2018); see also Sinnott v. Sinnott, 194 AD3d 868 (2d Dept. 2021). Husband shall not be responsible for the payment of unreimbursed medical expenses for Wife.
Husband shall also be responsible for maintaining a policy of health insurance for the subject children roughly equivalent to what they had under COBRA, however the cost of the same shall be split between the parties on a pro rata basis, with Husband responsible for 80% of the premium and Wife responsible for 20%. See Strohli v. Strohli, 174 AD3d 938 (2d Dept. 2019); DRL §240(1-b)(c)(5)(ii). If Husband obtains health insurance through his employment, whatever plan that employment offers shall be deemed sufficient coverage. In addition, Husband shall have an obligation to pay 80% of any reasonable and necessary unreimbursed medical, dental, pharmaceutical and therapeutic expenses for the subject children, with Wife being responsible for the remaining 20%. See Harris v. Harris, 97 AD3d 534 (2d Dept. 2012). While for the reasons set forth above this Court has found that a suspension of basic child support is warranted, a suspension of health insurance would endanger the subject children's health and welfare. However, Husband shall not be responsible to contribute to childcare costs for M. B and N. B while his child support obligation is suspended.
Life Insurance
Wife requests that this Court mandate Husband to obtain a life insurance policy in the amount of $2 Million Dollars to protect her maintenance and child support awards. Generally, a payor spouse may be required to maintain life insurance in an amount sufficient to secure an award of maintenance or child support in the event of their death. See Mayer v. Mayer, 142 AD3d 691 (2d Dept. 2016). Any such policy should be set at an amount sufficient to achieve that purpose. See D'Iorio v. D'Iorio, 135 AD3d 693 (2d Dept. 2016).
Here, Husband's obligation to pay child support is suspended, and his obligation to pay maintenance is in the amount of $3,239 a month of 18 months. Accordingly, Husband shall be required to maintain a life insurance policy of at least $58,302 to cover his maintenance [*56]obligation. Wife shall be the sole beneficiary of the policy. Husband shall only be required to maintain the policy until such time as his maintenance obligation ends. While the same theory would arguably apply to Wife's child support obligation, the Court notes that Husband has not asked for the Court to mandate Wife to obtain insurance.
Counsel Fees
As with most of the issues in this divorce, counsel fees are bitterly contested and unusually complicated. Thus far in this case, Wife has retained six of the most prominent matrimonial firms in New York and incurred approximately $613,836 in counsel fees, $314,336 of which is currently unpaid and owed. In contrast, Husband retained one attorney (who is prominent in his own right) who has represented him continuously and incurred $317,515 in counsel fees, $92,516 of which is unpaid and owed. Collectively, the parties have incurred approximately $931,351 in counsel fees which does not include legal fees paid to the multiple attorneys for the children assigned at various times in this case. This astronomical sum also excludes additional retainers paid for legal representation in separate civil and criminal cases related to this divorce. Wife has paid retainers of at least $50,000 in relation to her criminal case [FN12] and at least $25,000 in relation to Husband's civil case for his wrongful arrest.
In their respective Summations, both parties request that this Court order the other to pay all their legal bills. Wife argues that Husband is the monied spouse in this action and relies upon the presumption of counsel fees. Wife further argues that Husband has been inconsistent with following Court Orders and that she has had to file applications to compel his compliance. Husband argues that most, if not all, the counsel fees incurred by both parties here are directly connected to "the baseless positions" taken by Wife. Husband further argues that frequent changes in counsel, court appearances related to the same, and numerous meritless motions filed by Wife significantly delayed this proceeding causing thousands of dollars in unnecessary legal fees.
An award of reasonable counsel fees is a matter within the sound discretion of the trial court. The issue of counsel fees is controlled by the equities and circumstances of each case. See Nicodemus v. Nicodemus, 98 AD3d 605 (2d Dept. 2012). While DRL §237 permits consideration of many factors, paramount among these factors is financial need. See O'Halloran v. O'Halloran, 58 AD3d 704 (2d dept. 2009); see also Silverman v. Silverman, 304 AD2d 41 (1st Dept. 2003)."An award of an attorney's fee will generally be warranted where there is a significant disparity in the financial circumstances of the parties". Cohen v. Cohen, 73 AD3d 832 (2d Dept. 2010). The main purpose of a counsel fee award is to "redress the economic disparity between the monied spouse and the non-monied spouse. See O'Shea v. O'Shea, 93 NY2d 187 (1999). Other factors to be considered include the relative merits of the parties' positions, and if either party engaged in conduct that resulted in a delay of the proceedings or unnecessary litigation. See Vitale v. Vitale, 112 AD3d 614 (2d Dept. 2013). While all relevant factors must be considered, there is a rebuttable presumption that counsel fees should be awarded to the less monied spouse. See Marchese v. Marchese, 185 AD3d 571 (2d Dept. 2020); see also Boltz v. Boltz, 178 AD3d 656 (2d Dept. 2019).
The primary consideration when determining a counsel fee application is financial need. See Rennock v. Rennock, 203 AD3d 675 (2d Dept. 2022). Throughout the course of this proceeding Wife has taken the position that Husband is the "monied spouse" capable of earning at least $500,000 per year. However, as discussed at length above, Wife ignores that she was and remains, at all times, a 50% owner of YG. D LLC and took equal distributions therefrom until 2019. Accordingly, from 2015-2018 the parties' respective incomes were nearly identical. This Court has found that the imputation of income to Husband is unsupported by the trial record.
Wife further argues that Husband has a much higher earning capacity. It is undisputed that Husband currently earns approximately $220,000 a year while Wife is unemployed. Accordingly, Wife's position on earning capacity seems meritorious on its face. However, this Court has found that the difference between the parties' income potential is due more to Wife's refusal to seek gainful employment than it is to any other factor. The parties are of similar age, they both owned and operated a successful business, and they both have achieved equivalent college degrees. Wife's earning capacity from the use of her best efforts is only unclear because she refuses to enter the workforce.
Even assuming that Husband is in a superior financial position than Wife, this Decision essentially negates the economic gap between the parties through a significant award of maintenance and equitable distribution to Wife. Pursuant to this Decision, Wife will receive $3,239 a month in maintenance and over $440,000 in liquid assets. Husband, on the other hand, will have no liquid assets of note and will owe Wife a distributive award.
Under these unique circumstances, it is unclear which party should be considered the "monied" spouse. At the commencement of the action, it was clearly Husband, but after equitable distribution and maintenance, it could be Wife. Ultimately, the Court is constrained to find that Husband is technically the more monied spouse for counsel fee purposes as he is the only party who is employed. However, the economic difference is nowhere near as substantial as Wife claims given the distribution of assets herein. See Edelstein v. Edelstein, 168 N.Y.S.3d 855 (2d Dept. 2022). Accordingly, the Court will consider Wife's application for counsel fees affording her the benefit of the presumption set forth in DRL §237. However, this Court finds that Husband has successfully rebutted that presumption and that an award of counsel fees to Wife is not warranted. See Macaluso v. Macaluso, 145 AD3d 1295 (3rd Dept. 2016). In addition to the equalizing effect caused by the distribution of assets to Wife, Husband argues that most of the counsel fees incurred in this action directly relate to Wife's untenable and unsupportable positions. This Court agrees with this assessment.
At the onset, any consideration of a counsel fee award in this case must consider Wife's strained relationship with her attorneys. Husband argues that Wife's difficultly in maintaining an attorney-client relationship resulted in the expenditure of unnecessary fees. Wife first chose to retain counsel in March 2019. When initially contemplating the commencement of this action Wife drained over $600,000 from marital accounts and began retaining attorneys. In addition to retaining two criminal attorneys (in the same month), Wife also retained Mr. Yonatin Levoritz Esq. to commence the present divorce. Mr. Levortiz was retained for the sum of $7,500. Little is known of Mr. Levoritz's involvement in this matter as he only represented Wife for several days predating commencement until he was discharged. This brief exchange cost Wife $2,500 as she was only refunded $5,000 of the initial retainer.
On March 22, 2019, Wife retained Adam Edelstein Esq. to commence the present matter, which he did on April 12, 2019. Wife paid Mr. Edelstein an initial retainer of $25,000 and [*57]ultimately paid him an additional $2,720 before she discharged him eleven days after commencement on April 23, 2019. Wife has submitted Mr. Edelstein's bills in support of her counsel fee application. Therein, Mr. Edelstein details the difficulties he had with Wife as a client, indicating that she sent excessive emails, "will not make a decision" and is "demanding that I drop everything" (Pl. ex. 72). While such statements are unusual to find in legal billing, they provide insight into the difficulties Mr. Edelstein was encountering during his brief but expensive representation of Wife.
After Wife discharged Mr. Edelstein, she retained Raoul Felder Esq. on April 23, 2019. Mr. Felder's Office was retained at an hourly rate of $800 and was paid an initial retainer of $50,000. Mr. Felder's office represented Wife for approximately six months until they moved to withdraw as counsel on October 8, 2019 (Mot. Seq. No. 005)[FN13] . During those six months Wife incurred a staggering $217,896 in fees, $190,896 of which remain due and owing. Mr. Felder's Affirmation in support of his motion to withdraw argues that his representation of Wife had become "difficult," and that Wife had become distrustful of his representation such that the attorney client representation became "broken irretrievably."
After Mr. Felder's motion was granted, Wife retained Jeffrey Kaplan Esq. On October 24, 2019. Mr. Kaplan was paid an initial retainer of $30,000. Mr. Kaplan's representation of Wife continued for seven months until May 10, 2020, when he filed an "emergency" Order to Show Cause to withdraw as counsel (Seq. No. 007). During that time, Wife incurred an additional $78,979 in fees which remain due and owing. In support of his application, Mr. Kaplan claimed that representing Wife had become "unreasonably difficult" and argued that Wife "demonstrated an unwillingness to consider advice, answer questions, or supply necessary information." Mr. Kaplan further argued that Wife "questioned his competence" as an attorney.
After Mr. Kaplan's motion was granted, Wife retained Mary Grace Condello on June 26, 2020. Ms. Condello was paid an initial retainer of $50,000. Ms. Condello's representation of Wife continued for five months until December 3, 2020, when she moved to withdraw as counsel (Seq. No. 012). During that time Wife incurred an additional $28,419 in fees, $8,419 of which remain due and owing. Ms. Condello' motion is replete with examples of the difficulties she incurred while representing Wife. Ms. Condello states that Wife would refuse to come to her office, would refuse to provide required facts, and would demand that documents filed with the Court include irrelevant information. Ms. Condello argued that she had become an "indentured servant" and that Wife believed that she could be forced as an attorney to express "views that are contrary to the laws of the State of New York and contrary to her ethical obligations." Ms. Condello concludes her application by stating that she could provide "far more examples" but that they would simply belabor the point.
After Ms. Condello's motion was granted, Wife retained Michael Coscia Esq. of Abrams Fensterman, LLP on February 26, 2021. Abrams Fensterman LLP was paid an initial retainer of $40,000. Mr. Coscia zealously represented Wife throughout the trial of this action and remains her attorney of record to date. During his representation Wife incurred an additional $125,000 in fees that were paid out of escrow during trial (SFO 1/12/22). On July 26, 2022, Mr. Cosica filed [*58]an Order to Show Cause to withdraw as counsel while this matter was sub judice (Seq. No. 019). Mr. Coscia claims that his firm is presently owed the sum of $33,772. Mr. Coscia's Affirmation in support is intentionally devoid of details other than to state that Wife has "refused and ignored" his recommendations. Perhaps most telling is Mr. Coscia's statement that "his motion to be relieved was not made without considerable deliberation and is not made lightly." Motion sequence number 019 remains pending as of this time of this Decision and will be resolved herein.
The tortured history of legal representation detailed above evidences why this divorce action has become so complicated. See Lugo v. Torres, 174 AD3d 594 (2d Dept. 2019). Notably, Wife did not oppose any of the motions filed by her attorneys; she just went out and hired a new lawyer. Each of these "replacement" attorneys had to obtain records from prior counsel and familiarize themselves with the voluminous file incurring additional counsel fees that Wife now wants Husband to pay. Ultimately each representation experienced a similar, dysfunctional attorney-client relationship, and each ended the same way, namely with the retained attorney asking to be relived. The Court finds that Wife's poor treatment of her attorneys, the lack of respect she has shown for their professional ethics, and her refusal to follow their legal advice, unnecessarily delayed these proceedings and incurred thousands of dollars in avoidable legal fees. See Nieves-Iglesias v. Iglesias, 186 AD3d 1234 (2d Dept. 2020); see also Fredericks v. Fredericks, 85 AD3d 1107 (2d Dept. 2011). In reaching this conclusion, the Court has considered the voluminous billing documentation submitted into evidence [FN14] and found substantial time spent that could have been avoided by less frequent changes in counsel. See Matter of O'Shea v. Parker, 16 AD3d 510 (2d Dept. 2005); see also Ciampa v. Ciampa, 47 AD3d 745 (2d Dept. 2008). The Court has also found considerable evidence of the "micromanagement" complained of by Wife's attorneys including hundreds of hours spent answering Wife's incessant emails and phone calls.
In addition to the unnecessary delay detailed above, Husband is correct in asserting that many, if not most, of the positions taken by Wife in this proceeding were baseless and served to unnecessarily increase both parties' counsel fees. See Klestadt v. Klestadt, 120 N.Y.S. 3d 813 (2d Dept. 2020). Regarding the issues of custody and visitation, Husband enjoyed a close loving relationship with all three of the parties' children during the marriage. Wife's actions on March 16, 2019, and throughout this divorce proceeding, destroyed Husband's relationship with M. B and N. B with long lasting ramifications. Wife attempted to do the same with C. B, as evidenced by the filing of a frivolous motion to suspend her visits with Husband (Mot. Seq. No. 013). Wife's resistance to fostering a meaningful relationship between Husband and his children has made the issues of custody and visitation in this proceeding drastically more difficult and expensive than they otherwise should have been.
In relation to equitable distribution, Wife commenced this action after draining over $600,000 from marital accounts, emptying the parties' joint safe deposit boxes, and hiding hundreds of thousands of dollars in jewelry and gift cards from Husband. She then abandoned her responsibilities to the marital business while simultaneously arguing that Husband failed to save it. She then argued that income should be imputed to Husband based upon his established earning capacity from YG. D LLC while arguing that its business practices were illegal. All [*59]these baseless claims, and others, had to be refuted by Husband during discovery and at trial. To be clear, this Court is not casting blame on any of the attorneys retained by Wife. Rather, this Court has witnessed Wife direct her attorneys to make these kinds of arguments on her behalf, notwithstanding their reluctance to do so.
Early in this proceeding the parties' main asset was identified as an unfinished and uninhabitable home located on West Fingerboard Road. Initially, Wife wanted the home repaired so that she could move into it. However, she then frustrated the repairs to the property claiming that Husband was illegally colluding with the contractor. Predictably, the contractor quit, leaving the home unfinished and without a certificate of occupancy. Wife then vehemently opposed the sale of the property even though no one had ever resided therein (Mot. Seq. Nos.13 & 16). When this Court Ordered the sale over Wife's objection, she refused to participate in the closing requiring Husband to make a motion to compel her compliance (Mot. Seq. No. 015). This "stonewalling" conduct resulted in unnecessary ligation expenses for both parties. See Morrissey v. Morrissey, 259 AD2d 472 (2d Dept. 1999).
Finally, the Court notes that out of the twenty motions filed in this proceeding, nine were filed on Wife's behalf, four were filed by Wife's counsel to withdraw, and at least two of Husband's cross-motions were necessitated by baseless positions taken by Wife (Seq. Nos. 014 & 018). Upon review, many of the motions filed by Wife were meritless and served to only increase both parties' legal fees. See Cohen v. Cohen, 172 AD3d 1002 (2d Dept. 2019).
After considering the arguments made by both parties, reviewing the voluminous billing documentation submitted into evidence, and after considering the factors discussed above, this Court finds that Husband has successfully rebutted any presumption in Wife's favor. See Valitutto v. Valitutto, 137 AD3d 1526 (3rd Dept. 2016). Wife's inability to accept sound legal advice, her excessive micromanagement of her attorneys, and the resulting meritless positions that she has taken has unnecessarily delayed this proceeding and resulted in hundreds of thousands of dollars in fees that Husband should not be required to pay. See Neuschotz v. Neuschotz, 171 AD3d 585 (1st Dept. 2019); see also Klestadt v. Klestadt, 182 AD3d 592 (2d Dept. 2020); Walker v. Walker, 255 AD2d 375 (2d Dept 1998). Moreover, as the primary factor in considering counsel fees remains a financial one, the Court finds that Wife is capable of paying her own attorney's fees as she has received substantially all of the parties' liquid assets. See Murjani v. Murjani, 123 AD3d 409 (1st Dept. 2014); see also Moyal v. Moyal, 85 AD3d 614 (1st Dept. 2011); Morrongiello v. Paulson, 195 AD2d 594 (2d Dept. 1993). Husband, in contrast, has no liquid assets to speak of, and now owes Wife a considerable distribution award on top of his maintenance obligation and fees owed to his own attorney.
In addition to opposing Wife's application for counsel fees, Husband seeks an award in his favor in the amount of $317,516 representing the entirety of the sums that he paid and currently owes his attorney. This Court has already made a finding that Wife's tactics, conduct, and baseless positions unnecessarily delayed and complicated this proceeding, as such, an award to Husband is supported. See Odermatt v. Odermatt, 119 AD3d 754 (2d Dept. 2014); see also Silvers v. Silvers, 197 AD3d 1195 (2d Dept. 2021); Patete v. Rodriquez, 109 AD3d 595 (2d Dept. 2013). Moreover, While Husband potentially has a higher earning capacity, Wife presently has considerably more liquid assets. Under these circumstances, it is unclear which party should be considered the "more monied spouse." However, an award equal to Husband's entire counsel fee obligation is unwarranted. Not all of Wife's positions lacked merit, and the parties had some genuine issues regarding income and support that required a trial. Accordingly, after considering [*60]the arguments raised by both sides, and after reviewing Husband's billing documentation, the Court finds that a counsel fee award of $50,000 to Husband is appropriate to partially compensate him for unnecessary fees created by Wife's conduct. Under the unique circumstances of this Case the Court finds that an award to Husband is supported by DRL §237 but is equally supportable under 22 NYCRR 130-1.1(c), which authorizes a counsel fee award "where conduct by a party is completely without merit" and is undertaken to delay the litigation and harass or injure the other party. See Silverman v. Silverman, 304 AD2d 41 (1st Dept. 2003); see also DeBernardo v. DeBernardo, 180 AD2d 500 (1st Dept. 1992).
Charging Lien
Pursuant to Judiciary Law §475, an attorney in an action or proceeding has a statutory right to a lien against his or her client's cause of action. This lien, known as a "charging lien," does not provide for an immediately enforceable judgment, like a money judgment, but rather provides a security interest against an asset, i.e., a judgment or settlement in their client's favor. See Bernard v. De Rham, 161 AD3d 686 (1st Dept. 2018). In the context of a matrimonial proceeding, a charging lien is available to the extent that an equitable distribution award creates an award for the client "greater than the value of the interests already held." See Charnow v. Charnow, 134 AD3d 875 (2d Dept. 2015). A charging lien does not attach to an award of maintenance. See Theroux v. Theroux, 145 AD2d 625 (2d Dept. 1988).
Here, the only attorney who requested a charging lien against Wife was Raoul Felder Esq. In the Order granting his withdrawal from representation (SFO 10/8/19) Wife was given a period of 40 days to oppose the application for a lien, which she failed to do. However, no one from the Felder law firm appeared at any time during the proceeding, or at trial, to further assert their claim. Accordingly, there is no way for this Court to determine if the sums awarded to Wife herein were in any way "related to [Mr. Felder's] efforts" which occurred very early in this protracted proceeding. See Moody v. Sorokina, 50 AD3d 1522 (4th Dept. 2008); Chadbourne & Parke, LLP v. AB Recur Finans, 18 AD3d 222 (1st Dept. 2005). Moreover, Mr. Felder has failed to establish that Wife has received an award "greater than the value of the interests she already held" at the commencement of this action. All the assets addressed herein were distributed on a 50/50 basis reflecting each party's equal share of jointly owned property, thus a charging lien is likely inapplicable. See Wasserman v. Wasserman, 119 AD3d 932 (2d Dept. 2014); see also Theroux v. Theroux, 145 AD2d 625 (2d Dept. 1988). Accordingly, to the extent that Mr. Felder's charging lien is an open issue in this proceeding, the application for payment under the same is hereby denied without prejudice. This ruling in no way is intended to prohibit Mr. Felder from using whatever enforcement mechanisms are available to him to recover fees due and owing by Wife for his representation.
Reallocation
Both parties seek reallocation of certain litigation related fees incurred in this case including expert fees, court reporting fees, and counsel fees paid to the attorneys for the subject children ("AFC's"). During the course of this proceeding numerous orders were issued allocating these litigation expenses to one or both parties and often directing the fees to be paid out of the marital funds held in escrow. All such orders were made "subject to reallocation at trial." As [*61]indicated above (See "Equitable Distribution") the Court finds the accounting prepared by Wife's attorney to be an accurate representation of how the finds in escrow were distributed during this litigation. Accordingly, the findings herein are based upon a review of the Court's Orders and the trial record in conjunction with Wife's accounting. All the initial allocations not specifically addressed herein (such as court reporting fees) shall remain the way they were originally allocated in Wife's accounting.
Attorneys for the Subject Children's Fees
During the course of this litigation four attorneys were appointed to represent the subject children. On October 23, 2019, Mr. Thomas Conigatti Esq. was appointed to represent all three children and his fees were apportioned 100% to Husband. After Mr. Conigatti's untimely passing Mr. Ian Berliner was appointed as a substitute AFC on July 9, 2019. Mr. Berliner's fees were also apportioned 100% to Husband. On May 13, 2021, Rita Kaufman Esq. was appointed to the subject child C. B. Ms. Kaufman's fees were apportioned 100% to Wife. Mr. Anthony Morisano Esq. was appointed as substitute AFC for C. B on September 14, 2021. Mr. Morisano's fees were also apportioned 100% to Wife. Wife now seeks a reapportionment of the AFC fees arguing that Husband should be responsible for the entire expense as the "monied spouse."
Wife's application for a reallocation of the AFC's fees is hereby denied. The appointment of a second AFC to take over representation of C. B was solely necessitated by Wife's conduct. All three children were zealously represented by Mr. Berliner until such time as M. B and N. B's baseless position against their father created a conflict such that Mr. Berliner determined that he could no longer represent C. B. As this Court has found that Wife has caused the rift between Husband and M. B and N. B, the fees associated with C. B's split representation should remain apportioned solely to her.
As for Mr. Berliner's fee, the Court initially made its determination that Husband should be responsible for 100% of the cost of his representation based upon the fact that he was the more monied spouse, pendente lite. For reasons similar to those stated in relation the parties' respective counsel fee applications, this Court finds that Mr. Berliner's role was made unnecessarily difficult by Wife's conduct. However, by Orders dated October 14, 2021, and January 6, 2022, Mr. Berliner's fees were already reapportioned by this Court with $20,000 in fees paid 100% by Wife. This Court finds that these Orders sufficiently balanced the equities such that further reallocation is unwarranted.
Business Evaluation Fees
In May 2019, the parties agreed that YG. D LLC would be valued by the firm of Klein Liebman & Gresent LLC ("KLG"). By Order dated June 12, 2019, this Court found that the cost of this appraisal would be paid 100% by Husband subject to reallocation at trial. The June 12 Order further authorized the parties to withdraw the sums necessary to pay KLG from the funds held in escrow. According to the parties' Summations the total sum of $39,799 was paid to KLG for the preparation of a valuation report and their trial testimony. One hundred percent of this sum was allocated out of Husband's share of the funds held in escrow.
Early in this proceeding Wife was the party who requested that YG. D LLC be valued [*62]taking the position that she had a marital interest in "Husband's business."[FN15] However, as the facts developed it was obvious that both parties had an equal ownership interest in the business and that neither had any interest in continuing to operate the same. This distinction is relevant because as equal owners, a distributive award would only be warranted if one party wished to "buy the other out." Husband now argues that the valuation served little use under the circumstances as he has never taken the position that he wished to purchase Wife's interest in the company. However, Wife has sought a distributive award of over $1.3 Million dollars related to her 50% interest. As Wife is the party who sought the valuation of the company and is the only party making a claim for its distribution, the Court finds it equitable that she shares the cost of the valuation. Accordingly, KLG's fees in the sum of $37,799 are hereby reallocated to 50% to each party. Thus, Husband's equitable share of the funds held in escrow has been increased by the sum of $18,900 and Wife's decreased by the same sum (See "Equitable Distribution" above).
Forensic Evaluator's Fees
By Order dated July 9, 2019, this Court appointed Dr. Kaplan to conduct a forensic evaluation of the parties and subject children. The appointment was made necessary by allegations of domestic violence (made by both parties) and disputed issues of custody, appropriate parenting time, decision making, and parental alienation. The cost of Dr. Kaplan's initial fee of $25,650 was attributed 100% to Husband and paid out of escrow on December 18, 2019.
As the facts developed, and it became apparent that Husband's relationship with M. B and N. B was worsening, the Court ordered an updated forensic evaluation by Order dated May 13, 2021. Pursuant to that Order all costs related to the updated forensic evaluation would be attributed 100% to Wife, to be paid out of escrow. The cost for Doctor Kaplan to reinterview the parties was $12,500, however, when the payment was withdrawn from escrow counsel incorrectly allocated it 50% to each party. Dr. Kaplan's Updated Report was completed in September 2021. On September 22, 2021, the parties entered into a Consent Order, wherein they agreed to withdraw the sum of $19,630 from escrow to pay for the updated report. This withdrawal was once again incorrectly allocated, as 100% of the fee was assessed to Husband. Dr. Kaplan testified in support of his report on January 6, 2022. The cost of this testimony ($12,000) was withdrawn from escrow and allocated evenly between the parties. In total, the parties paid Dr. Kaplan $69,780 for his work related to this case.
Both parties seek reallocation of Dr. Kaplan's fees. As detailed herein, Husband had a close loving relationship with all three of the subject children up until the March 16 Incident. At or around that time Wife began a pattern of parental alienation that has caused this proceeding to become unnecessarily complex and protracted. Under the circumstances detailed herein, and for the reasons set forth above (See "Custody & "Counsel Fees") the Court finds it equitable that the cost of the initial forensic evaluation be split evenly between the parties. Moreover, when the Court issued its May 13th Order, it intended for the entire cost of the updated forensic evaluation [*63]and report to be attributed 100% to Wife. Nothing in the parties' Consent Order dated September 22, 2021 changed that ruling. Accordingly, the $19,630 sum paid out of escrow on September 27, 2021 and the $12,500 sum paid out of escrow on May 20, 2021 should have been attributed 100% to Wife. Dr. Kaplan's trial testimony shall remain evenly split as he would have been required to testify in support of his initial report, which has been equally reallocated between the parties.
Thus, for the reasons set forth above, the initial payment to Dr. Kaplan of $25,650 on December 18, 2019 shall be reallocated to $12,825 each. The payment made to Dr. Kaplan of $12,500 on May 20, 2021 for the updated forensic evaluation shall be attributed 100% to Wife, as shall the payment for this updated report ($19,630) which was withdrawn on September 27, 2021. This results in a net increase in Husband's share of the funds held in escrow by the sum of $38,705 and a decrease of the same sum for Wife ($19,630 + $12,825 + $6,250 = $38,705).
Eileen Montrose M.S.W.
In an attempt to repair the relationship between Husband, M. B and N. B this Court ordered therapeutic visitation with the assistance of a social worker Ms. Eileen Montrose (SFO 10/31/21). Regrettably, Ms. Montrose's intervention was unsuccessful at reestablishing a healthy relationship. Both parties agreed that Ms. Montrose would not be called as a witness at trial however her fees remain at issue. On October 27, 2021, the parties withdrew the sum of $1,500 from escrow to pay Ms. Montrose and allocated it evenly $750 each. Now, upon reallocation this Court shall attribute 100% of the cost of Ms. Montrose to Wife as her intervention was only made necessary by Wife's parental alienation. This results in a net increase of Husband's share of the funds held in escrow by $750, and a decrease of the same sum for Wife.
Motions Referred to Trial
On or about June 12, 2020, Husband filed a motion seeking to modify his pendente lite support obligations (Seq. No. 008). The motion was referred to trial. While the motion was commonly referred to as a "downward modification" motion during trial, Husband does not actually seek to reduce his pendente lite obligations therein. Rather he agreed to continue paying $6,000 a month in combined pendente lite child support and maintenance. The only affirmative relief sought by Husband is to have his additional pendente lite obligations, to wit, Wife's rent, vehicle lease payments, and the mortgage related to West Fingerboard Road be paid out of escrow, subject to allocation at trial.
This Court finds that Husband's motion has been rendered moot by this Decision. Husband has been granted credit for the pendente lite payment of Wife's rent in relation to the retroactive awards of child support and maintenance above. Moreover, as this Court has found that Husband overpaid both child support and maintenance pendente lite, the addition of Wife's vehicle lease payments would only add another sum that he could not recoup due to public policy concerns. As for the payment of the mortgage related to the West Fingerboard Road property, that issue has been addressed in relation to the reallocation of the sums held in escrow.
In addition to Husband's motion for a downward modification, which was referred to trial in its entirety, various aspects of other motions filed during this proceeding were also referred to trial. A thorough review of those motions, and this Decision, reveals that all issues raised therein [*64]have either been decided, or rendered moot, by the issuance of this comprehensive Decision after Trial.
Conclusion
For the detailed reasons set forth above, and in accordance with the testimony of both parties, and the terms of the Preliminary Conference Order, Plaintiff Wife is hereby granted a Judgment of Divorce on the ground that the parties' marriage has broken down irretrievably for a period of six months. See DRL §170(7).
The parties shall have joint legal custody of M. B and N. B with mother having sole residential custody. No specific parental access schedule is being granted to Husband at this time although the parties are directed to attend reunification therapy as set forth herein. While the parties are required to confer on all major decisions regarding all three children, Husband is hereby granted final decision-making authority in the medical decision-making sphere, including all mental health services mandated herein, for all three subject children. Husband shall have the right to seek court ordered access to M. B and N. B, without establishing a change of circumstances, if parties cannot agree to a visitation schedule after therapy progresses.
Husband shall have sole, legal and physical custody of C. B. Wife shall have a parental access schedule with C. B as set forth herein. Both parents shall have independent access to all the children's medical and educational providers. A Short Form Order will be issued in conjunction with this Decision modifying the parties' current parental access schedule with C. B to reflect this Decision's directives.
The Court has made various equitable distribution awards herein, payable to one or the other spouse. After calculating the total of the various awards herein, the Court finds that Wife is entitled to distributive awards from Husband totaling $811,581 together with a separate rollover IRA in the amount of $26,059. Husband is entitled to distributive awards from Wife totaling $450,672. This results in a net award of $360,909 payable from Husband to Wife ($811,581 - $450,672 = $360,909). The only readily accessible liquid asset available to the parties are the funds currently held in escrow. The sum of $440,203 remains in escrow,[FN16] $193,520 of which has been awarded to Husband herein. To simplify the exchange of funds the attorney or attorneys maintaining the escrow account(s) are hereby directed to release the entire sum remaining in escrow ($440,203) to Wife. Of those funds $193,520 will be attributed to the amount Husband owes Wife. After Wife receives the entirety of the funds held in escrow, it will leave a balance owed of $167,389($360,909 - $193,520 = $167,389).
Wife has been directed to pay the sum of $50,000 towards Husbands' counsel fees. Rather than ordering multiple exchanges of the same funds, Husband's outstanding obligation of $167,389 shall be reduced by the sum of $50,000 resulting in a total amount owed of $117,389. As Wife is receiving substantially all the parties' liquid assets the Court finds it equitable that Husband be granted a reasonable period in which to make this payment. Accordingly, the balance owed will be payable in four annual installment payments of $29,347. The first such [*65]payment shall be due by September 30, 2023, the second payment by September 30, 2024, and so on, until the total amount due is paid in full.
Wife's application for a final award of maintenance is hereby granted in the amount of $38,866 a year or $3,239 a month. The first payment of final maintenance under this Decision shall be due within seven days of service of the signed Judgment of Divorce. The Pendente Lite Order shall remain in effect until that time. This final award of maintenance shall be payable for 18 months running from the signing of the Judgment of Divorce.
Husband's child support obligation for M. B and N. B has been determined to be $32,600 a year, or $2,716 a month. However as set forth herein, Husband's obligation to pay child support has been suspended until such time as his rights to parental access with M. B and N. B have been meaningfully restored. Wife's child support obligation for C. B has been determined to be $5,542 a year or $462 a month. To avoid cross payments, Husband's maintenance obligation is hereby reduced by the sum of $462 a month to cover Wife's child support obligation. This results in a monthly maintenance obligation of $2,777. Once Husband's obligation to pay maintenance ends, Wife shall be obligated to pay the sum of $462 a month to Husband until C. B turns 21 years of age or is otherwise emancipated. Either party shall have the right to seek modification of the child support awards herein upon a showing of a change in circumstances, an increase or decrease in either party's income by at least 15% or the passage of three years-time. However, the suspension of Husband's obligation to pay child support shall remain until such time as he is granted reasonable access with the subject children as determined by Husband, or a Court of competent jurisdiction upon Wife's application.
Wife's application for an award of counsel fees is denied for the reasons set forth herein. Husband's application has been granted, in part, and the amount payable by Wife deduced from the distributive award owed to her by Husband.
All motions that have been referred to trial have either been resolved or mooted by the issuance of this Decision. To the extent that this Decision does not resolve a specific application raised in those motions, that application is hereby denied. Husband's post-trial motion for an immediate change in custody has been mooted by the issuance of this Decision. Wife's counsel's motion to withdraw from representation is hereby resolved with a ruling that his representation of Wife shall end upon the signing of a Judgment of Divorce encompassing this Decision's Terms. Wife has not filed opposition to her attorney's motion to date.
As the party being granted the divorce it would typically be Plaintiff Wife's obligation to file a Judgment of Divorce. However, as her attorney has filed a motion to withdraw as counsel, Defendant Husband is hereby directed to serve and file a Judgment of Divorce in accordance with the terms of this Decision, together with Findings of Fact and Conclusions of Law. In addition, Defendant is hereby directed to file all necessary supporting documentation together with a Note of Issue if one has not been filed. The Judgment, and supporting documentation is to be filed within 30 days of the issuance of this Decision.
This constitutes the Decision of the Court after trial, any issue raised during trial that was not specifically addressed herein is hereby denied.
Dated: September 16, 2022Hon. Catherine M. DiDomenico
Acting Supreme Court Justice Footnotes
Footnote 1: Husband's counsel claims $441,422 remains in the account while Wife's counsel asserts that the account contains $440,203.
Footnote 2: The allegations in this as of yet unopposed motion have not been considered by the Court in relation to this Decision, the Court simply takes notice of its filing and the relief requested therein.
Footnote 3: Repeatedly misidentified in Husband's papers and trial testimony as $105,135.
Footnote 4: Incorrectly dated as June 12, 2017 in the original.
Footnote 5:All post commencement credit card debt has been found to be non-marital and the responsibility of the party that incurred it (see "Marital Debt").
Footnote 6: DKP Wood Railings, GoldCast (X2), Madonia Development Fence Deposit, Madonia Development Floors/ Fence
Footnote 7: Including reimbursements from unutilized retainers for the attorneys for the subject children and an overcharge from the real estate broker.
Footnote 8: See Orders dated 6/18/19, 12/2/19, 6/10/20, 2/22/21, 4/27/21, 5/13/21, 9/14/21, 9/22/21, 9/24/21, 10/14/21, 1/6/22, 1/13/22.
Footnote 9: The entry reads "#Rtrn Dep Item Debit . -3,336.18"
Footnote 10:The statutory revisions were made effective on January 16, 2016.
Footnote 11:The W2 actually identifies Husband's employer as "Trinet HR III, Inc." but Husband testified that Trinet is a billing company for "Seeking Alpha."
Footnote 12: An unknown amount of which was refunded to Wife.
Footnote 13: The Court takes judicial notice of Mr. Felder's motion to withdraw as counsel (Seq. No. 005), together with Mr. Kaplan's motion to withdraw (Seq. No. 008), Ms. Condello's motion to withdraw Seq. No. 012); and Mr. Coscia's motion to withdraw (Seq. No. 019).
Footnote 14: Plaintiff's Exhibits #72,74,76,78,80.
Footnote 15: The Preliminary Conference Order (dated 5/15/19) which was drafted by Wife's counsel, indicates that the business interest to be valued was "Defendant's Business."
Footnote 16: Utilizing Wife's figures. If Husband's figures are correct, then counsel are hereby directed to adjust the amount owed accordingly after the entirety of the funds in escrow are distributed to Wife.
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