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News Page - This page continues Recent Cases and News.  Scroll down to see everything previously reported in the Recent Cases and News Column.

 

 

 

Laws of 2009, Ch 215, effective October 9, 2009, amended the Mandatory Award of Health Care Expenses Provision of the Basic Child Support Obligation, contained in Domestic Relations Law § 240 (1-b) (c) (5), the Child Support Standards Act.

(For a comprehensive discussion, click on this link to download Mandatory Health Care Expenses by Joel R. Brandes )

Former Domestic Relations Law § 240 (1-b) (c) (5), and Family Court Act § 413, subdivision 1 (c) (5), which were amended in 2009, required the court to prorate each parent's share of the reasonable health care expenses of the child, where such expenses are not covered by insurance, in the same proportion as each parent's income is to the combined parental income. They provided that the noncustodial parent's pro rata share of such health care expenses was to be paid in a manner determined by the court, including direct payment to the health care provider.  Laws of 2009, Ch 215 § 2. (See also Family Court Act 413, subdivision 1 (c) (5), Laws of 2009, Ch 215 § 1). Former Domestic Relations Law § 240 (1-b), subdivision (c) (5) was repealed and a new Domestic Relations Law §240 (1-b) (c) (5) was added. It provides, in part, that:

" The court shall determine the parties' obligation to provide health insurance benefits pursuant to this section and to pay cash medical support as provided under this subparagraph."

"Cash medical support" means an amount ordered to be paid toward the cost of health insurance provided by a public entity or by a parent through an employer or organization, including employers or organizations which are self insured, or through other available health insurance or health care coverage plans, and/or for other health care expenses not covered by insurance.

It also provides, in part:

(v) In addition to the amounts ordered under clause (ii), (iii), or (iv), the court shall pro rate each parent's share of reasonable health care expenses not reimbursed or paid by insurance, the medical assistance program established pursuant to title eleven of article five of the social services law, or the state's child health insurance plan pursuant to title one-A of article twenty-five of the public health law, in the same proportion as each parent's income is to the combined parental income, and state the non-custodial parent's share as a percentage in the order. The non-custodial parent's pro rata share of such health care expenses determined by the court to be due and owing shall be support arrears/past due support and shall be subject to any remedies provided by law for the enforcement of support arrears/past due support. In addition, the court may direct that the non-custodial parent's pro rata share of such health care expenses be paid in one sum or in periodic sums, including direct payment to the health care provider.
(vi) Upon proof by either party that cash medical support pursuant to clause (ii), (iii), (iv), or (v) of this subparagraph would be unjust or inappropriate pursuant to paragraph (f) of this subdivision, the court shall:
(A) order the parties to pay cash medical support as the court finds just and appropriate, considering the best interests of the child; and
(B) set forth in the order the factors it considered, the amount calculated under this subparagraph, the reason or reasons the court did not order such amount, and the basis for the amount awarded.

Former Domestic Relations Law § 240(1)(d) and Family Court Act § 416(f), which provided for the proration of costs between the parties where private health insurance is ordered, were amended at the same time to provide that the cost of private health insurance, or the cost of any premium, family contribution, or health expense incurred as a result of enrollment in the State Child Health Insurance Program or Medical Assistance program shall be deemed “cash medical support.” Each parent's contribution to the cost of such coverage is to be determined under the amended provisions of and Domestic Relations Law § 240 (1-b) (c) (5) and Family Court Act § 413, subdivision 1 (c) (5). Laws of 2009, Ch 215 § 7 & 8.

Family Court Act §§ 514 and 545, respectively, were amended to provide that the necessary expenses incurred by or for the mother in connection with her pregnancy, confinement and recovery shall be deemed a cash medical support obligation and the court must determine the obligation of either or both parties to contribute to the cost pursuant to Family Court Act § 413. Laws of 2009, Ch 215, §§ 7 & 8.

CPLR 5241 was amended to provide that a Deductions to satisfy current support obligations shall have priority over deductions for the debtor's share of health insurance premiums which shall have priority over any additional deduction authorized by CPLR 5241 (g). Civil Practice Law and Rules 5241 (h) as amended by Laws of 2009, Ch 215,§ 12, effective Oct. 9, 2009.

 

 

 

Return of Parent from Military Automatically Considered 'Substantial Change in Circumstance For Seeking Reconsideration of Custody or Visitation Order.

Laws of 2009, Ch 473, effective November 15, 2009, amended the Domestic Relations Law, the Family Court Act and the Military Law to provide that the return of a parent from activation or deployment by the military will automatically be considered a 'substantial change in circumstance' for seeking reconsideration of a custody or visitation order. The amendment changes the law enacted last year which requires that all child custody orders issued when a parent is on active military duty be deemed temporary and subject to revision when the parent returns to civilian life.

Laws of 2009, Ch 473, § 1 amended Domestic Relations Law § 75-l ( entitled Military service by parent; effect on child custody

orders) to provide unless the parties have otherwise stipulated or agreed, if an order was issued under Domestic Relations Law § 75-l, the return of the parent from active military service, deployment or temporary assignment shall be considered a substantial

change in circumstances. Upon the request of either parent, the court shall determine on the basis of the child's best interests whether the custody judgment or order previously in effect should be modified.

Laws of 2009, Ch 473, § 2 amended Domestic Relations Law 240, subdivision 1 to add a new paragraph (a-2) to read as follows:

(a-2) Military service by parent; effect on child custody orders.

(1) During the period of time that a parent is activated, deployed or temporarily assigned to military service, such that the parent's ability to continue as a joint caretaker or the primary caretaker of a minor child is materially affected by such military service, any orders issued pursuant to this section, based on the fact that the parent is activated, deployed or temporarily assigned to military service, which would materially affect or change a previous judgment or order regarding custody of that parent's  child or children as such judgment or order existed on the date the parent was activated, deployed, or temporarily assigned to military service, shall be subject to review pursuant to subparagraph three of this paragraph. Any relevant provisions of the Service Member's Civil Relief Act shall apply to all proceedings governed by this section.

(2) During such period, the court may enter an order to modify custody if there is clear and convincing evidence that the modification is in the best interests of the child. An attorney for the child shall be appointed in all cases where a modification is sought during such military service. Such order shall be subject to review pursuant to subparagraph three of this paragraph. When entering an order pursuant to this section, the court shall consider and provide for, if feasible and if in the best interests of the child, contact between the military service member and his or her child, including, but not limited to, electronic communication by e-mail, webcam, telephone, or other available means. During the period of the parent's leave from military service, the court shall consider the best interests of the child when establishing a parenting schedule, including visiting and other contact. For such purposes, a "leave from military service" shall be a period of not more than three months.

(3) Unless the parties have otherwise stipulated or agreed, if an order is issued pursuant to this paragraph, the return of the parent from active military service, deployment or temporary assignment shall be considered a substantial change in circumstances. Upon the request of either parent, the court shall determine on the basis of the child's best interests whether the custody judgment or order previously in effect should be modified.

(4) This paragraph shall not apply to assignments to permanent duty stations or permanent changes of station.

Laws of 2009, Ch 473, § 3 amended Family Court Act § 651 to add a new subdivision (f) which reads exactly the same as Domestic Relations Law 240, subdivision 1 (a-2).

Judges Required to Make Additional Findings Where Domestic Violence Found

Laws of 2009, Ch 476, § 2 amended Domestic Relations Law § 240 (1)(a), effective December 15, 2009 to require judges to state on the record how their findings with regard to the effect of domestic violence factored into their custody determination. Where the court finds, by a preponderance of the evidence that there is domestic violence the court has been required to consider the effect of domestic violence upon the best interests of the child, together with such other facts and circumstances as the court deems relevant in making a direction pursuant to Domestic Relations Law § 240 (1)(a). The amendment requires the Court to state on the record how such findings, facts and circumstances factored into the direction for custody or visitation. If an allegation that a child is abused is supported by a preponderance of the evidence, then the court has been required to consider such evidence of abuse in determining the visitation arrangement that is in the best interest of the child, and the court may not place a child in the custody of a parent who presents a substantial risk of harm to that child. The amendment requires the court to state on the record how such findings were factored into the determination.

Attorney For Child Will be Required to Take Domestic Violence Training

Laws of 2009, Ch 476, § 1 amended Family Court Act 249-b to require the Chief Administrator of the Courts to provide for the development of training programs which include the dynamics of domestic violence and its effect on victims and on children, and the relationship between such dynamics and the issues considered by the court, including, but not limited to, custody, visitation and child support and requires that all attorneys for children, including new and veteran attorneys, receive initial and ongoing training as provided for in this section.

Additional Crimes that Constitute a Family Offense Added

Laws of 2009, Ch 476, § 3 and 4, amended Criminal Procedure Law 530.11, and Family Court Act 812 (1) to add the crimes of sexual misconduct, forcible touching, sexual abuse in the third degree, and sexual abuse in the second degree as set forth in subdivision one of section 130.60 of the penal law to the crimes which constitute a "family offense". Family Court Act 821 (1) (a) was amended accordingly.

 

Loss of Health Insurance Added as New Factors in Maintenance and Property Distribution Awards

Laws of 2009, Ch 229 amends the domestic relations law, in relation to maintenance and equitable distribution of marital property, effective September 14, 2009 to add "the loss of health insurance benefits upon dissolution of the marriage as a factor to be considered by the court in making a maintenance award and in making a property distribution. Domestic Relations Law 236 [B][5][d], subparagraphs 5, 6, 7, 8, 9, 10, 11, 12 and 13 were renumbered subparagraphs 6, 7, 8, 9, 10, 11, 12, 13 and 14, and a new subparagraph 5 is added to read as follows: (5) the loss of health insurance benefits upon dissolution of the marriage. Domestic Relations Law 236 [B][6][a][10] is amended to read as follows: (10) any transfer or encumbrance made in contemplation of a matrimonial action without fair consideration. Domestic Relations Law 236 [B][6][a][11] is renumbered subparagraph 12 and a new subparagraph 11 is added to read as follows: (11) the loss of health insurance benefits upon dissolution of the marriage. The amendments apply to any action or proceeding commenced on or after the effective date of September 14, 2009. See Laws of 2009, Ch 229, 4.

 

Domestic Relations Law § 177 has been repealed, and replaced by Domestic Relations Law § 255, which was signed into law on July 11, 2009. It becomes effective 90 days after the date it was signed into law and applies to all actions in which judgment has not been entered as of the effective date. (See Laws of 2009, Ch 143)

Domestic Relations Law § 255, subdivision 1 provides that prior to signing a judgment of divorce or separation, or a judgment annulling a marriage or declaring the nullity of a void marriage, the court must ensure that both parties have been notified, at such time and by such means as the court determines, that once the judgment is signed, a party thereto may or may not be eligible to be covered under the other party's health insurance plan, depending on the terms of the plan. In the case of a defaulting defendant, service upon the defendant, simultaneous with the service of the summons, of a notice indicating that once the judgment is signed, a party thereto may or may not be eligible to be covered under the other party's health insurance plan, depending on the terms of the plan, shall be deemed sufficient notice to a defaulting defendant. (Click here to download a suggested Notice of Possible Loss of Eligibility For Health Care Coverage)

Domestic Relations Law § 255, subdivision 2 provides that if the parties have entered into a stipulation of settlement or agreement, on or after the effective date of Section 255, resolving all of the issues between the parties, the stipulation of settlement or agreement must contain a provision relating to the health care coverage of each party. The provision must either: (a) provide for the future coverage of each party, or (b) state that each party is aware that he or she will no longer be covered by the other party's health insurance plan and that each party shall be responsible for his or her own health insurance coverage, and may be entitled to purchase health insurance on his or her own through a COBRA option, if available. The requirements subdivision 2 may not be waived by either party or counsel. In the event that it is not complied with, the court must require compliance and may grant a thirty day continuance to afford the parties an opportunity to procure their own health insurance coverage. (Click here to download a suggested Agreement-Stipulation Provision for Compliance with Domestic Relations Law § 255)

 

Domestic Relations Law 236 [B] [2] was amended, by Laws of 2009, Chapter 72, § 1, effective September 1, 2009, to add a subdivision b, which provides for automatic restraining orders that come into effect upon the commencement of a matrimonial action and bind both parties. (Click here to download a suggested form notice of automatic restraining orders)

Domestic Relations Law § 236 (B) (2) (b) provides that the plaintiff shall cause to be served upon the defendant, simultaneous with the service of the summons, a copy of the automatic orders set forth in subdivision (b). This paragraph places upon the plaintiff a duty to serve upon the defendant automatic orders which bind both parties. The automatic orders are binding upon the plaintiff upon the commencement of the action by the filing of the summons or summons and complaint. They are binding upon the defendant upon service of the Summons or ‘Summons and Complaint. The automatic orders remain in full force and effect during the pendency of the action, unless terminated, modified or amended by further order of the court, upon motion of either of the parties, or upon written agreement between the parties duly executed and acknowledged. The automatic orders are as follows: (1) Neither party shall sell, transfer, encumber, conceal, assign, remove or in any way dispose of, without the consent of the other party in writing, or by order of the court, any property (including, but not limited to, real estate, personal property, cash accounts, stocks, mutual funds, bank accounts, cars and boats) individually or jointly held by the parties, except in the usual course of business, for customary and usual household expenses or for reasonable attorney's fees in connection with this action.(2) Neither party shall transfer, encumber, assign, remove, withdraw or in any way dispose of any tax deferred funds, stocks or other assets held in any individual retirement accounts, 401K accounts, profit sharing plans, Keogh accounts, or any other pension or retirement account, and the parties shall further refrain from applying for or requesting the payment of retirement benefits or annuity payments of any kind, without the consent of the other party in writing, or upon further order of the court. (3) Neither party shall incur unreasonable debts hereafter, including, but not limited to further borrowing against any credit line secured by the family residence, further encumbrancing any assets, or unreasonably using credit cards or cash advances against credit cards, except in the usual course of business or for customary or usual household expenses, or for reasonable attorney's fees in connection with this action. (4) Neither party shall cause the other party or the children of the marriage to be removed from any existing medical, hospital and dental insurance coverage, and each party shall maintain the existing medical hospital and dental insurance coverage in full force and effect. (5) Neither party shall change the beneficiaries of any existing life insurance policies, and each party shall maintain the existing life insurance, automobile insurance, homeowners and renters insurance policies in full force and effect. (Click here to download a suggested form notice of automatic restraining orders)

Laws of 2009, Ch 32, repealed Family Court Act 516 Relating to Compromise Agreements in Paternity Proceedings, effective May 19, 2009.

 

Court of Appeals Holds Non-custodial Parent Does Not Retain Decision-making Authority Pertaining to Education of Child Where Custodial Parent Granted Exclusive Custody of the Child and Decree and Custody Order Are Silent as to Right to Control Such Decisions.

In Fuentes v Board of Educ. of City of New York, --- NY3d ----, 2009 WL 1148636 (2009) Plaintiff Jesus Fuentes and his wife were divorced in 1996. Family Court entered an order granting the wife exclusive custody of the three children, including a son, M.F., who, due to a genetic disorder, was legally blind. M.F. attended public school in New York City and received special education services to accommodate his disability. In 2000, plaintiff believed that M.F.'s special education services and accommodations were inadequate and requested a reevaluation. When the Committee on Special Education for the Hearing, Handicapped, and Visually Impaired responded that M.F's services were adequate, plaintiff requested a hearing from the Impartial Hearing Office of the New York State Department of Education to review that determination. In 2001, plaintiff's request for a hearing was denied based on his status as the non-custodial parent of M.F. The Office concluded that because plaintiff was not the "person in parental relation" (Education Law 3212), he did not have the right to make educational decisions pertaining to M.F. and, consequently, did not have a right to request a hearing. Plaintiff then commenced an action in the United States District Court, alleging, among other things, that he was denied his right under the federal Individuals with Disabilities Education Act (IDEA) to a hearing to review the determinations of the Board of Education. After a dismissal, appeal, and remand on issues not pertinent to the certified question, the district court dismissed plaintiff's case for lack of standing under the IDEA. On appeal, the United States Court of Appeals for the Second Circuit found that no precedent from the Court of Appeals directly addressed the dispositive issue and certified a question, which the Court of Appeals reformulated: " Whether, under New York Law, the non-custodial parent of a child retains decision-making authority pertaining to the education of the child where (1) the custodial parent is granted exclusive custody of the child and (2) the divorce decree and custody order are silent as to the right to control such decisions. " As reformulated the certified question was answered in the negative. The Court of Appeals noted that it is well settled in the Appellate Division that, absent specific provisions in a separation agreement, custody order, or divorce decree, the custodial parent has sole decision-making authority with respect to practically all aspects of the child's upbringing. It declined to recognize an implied right of non-custodial parents to exercise decision-making authority with respect to their child's education notwithstanding the custody order's silence on this subject and emphasized the importance of parties determining these issues at the time of separation or divorce. The Court noted the distinction between a non-custodial parent's right to "participate" in a child's education and the right to "control" educational decisions. Generally, there is nothing which prevents a non-custodial parent (even one without any decision making authority) from requesting information about, keeping apprised of, or otherwise remaining interested in the child's educational progress. However, unless the custody order expressly permits joint decision-making authority or designates particular authority with respect to the child's education, a non-custodial parent has no right to "control" such decisions. This authority properly belongs to the custodial parent.

 

Not Necessary to Plead Justification as Defense to Abandonment Where Not a Claim That Would Be Likely to Take the Plaintiff by Surprise, and Does Not Raise Issues of Fact Not Appearing on the Face of the Complaint

In Gulati v Gulati, 60 A.D.3d 810, 876 N.Y.S.2d 430 (2 Dept 2009) the Appellate Division pointed out that pursuant to DRL 170(2), an action for a divorce on the ground of abandonment may be maintained when the defendant abandons the plaintiff for a period of one or more years. To establish entitlement to a divorce on this ground, a plaintiff must demonstrate that the defendant unjustifiably and without the plaintiff's consent abandoned the plaintiff for a period of one or more years. Here, the plaintiff made a prima facie showing of her entitlement to summary judgment on the ground of abandonment by submitting evidence that the defendant moved out of the marital residence in April 2003 without her consent, and without justification. In opposition, the defendant submitted evidentiary proof sufficient to raise triable issues of fact as to whether an abandonment occurred. The submissions raised issues of fact as to whether the plaintiff consented to his initial departure from the marital residence and to his continued absence from the home, and whether his actions were justified. Accordingly, plaintiff's motion for summary judgment on her cause of action for a divorce based on abandonment should have been denied. The Court rejected plaintiff's contention that the defendant waived the right to argue that he was justified in leaving and remaining away from the marital residence because he did not plead justification as an affirmative defense in his answer. Since abandonment cannot be established merely by evidence of a separation, a plaintiff seeking a divorce on this ground has an obligation to prove, as an element of his or her prima facie case, that the defendant unjustifiably left and remained away from the marital residence for a period of more than one year. Although the Court has recognized that it is permissible to plead justification as an affirmative defense (see Del Galdo v. Del Galdo, 51 A.D.2d 741, 379 N.Y.S.2d 479), it held that it is not necessary that it be so pleaded where, as here, it is not a claim that would be likely to take the plaintiff by surprise, and does not raise issues of fact not appearing on the face of the complaint (see CPLR 3018[b] ). In this regard, the Court noted that the plaintiff alleged in her complaint that the defendant had abandoned the marital residence without cause or provocation, and the defendant denied these allegations in his answer. Under these circumstances, the defendant, who has not defaulted, should not be precluded from arguing that he was justified in leaving and remaining away from the marital residence.

Error to Permit "Licensed Mental Health Counselor"To Offer Opinion Based in Part upon Interviews with Collateral Sources Who Did Not Testify

In Matter of Murphy v Woods,--- N.Y.S.2d ----, 2009 WL 1565164 (N.Y.A.D. 4 Dept.) the Appellate Division held that Family Court erred in permitting a "licensed mental health counselor," who examined the parties' child and was called as a witness by the mother, to offer an opinion that was based in part upon his interviews with collateral sources who did not testify at trial. There are two exceptions to the general rule requiring that opinion evidence be based on facts in the record or on facts personally known to the witness: if the opinion is based upon out-of-court material "of a kind accepted in the profession as reliable in forming a professional opinion or if it comes from a witness subject to full cross-examination on the trial" (Hambsch v. New York City Tr. Auth., 63 N.Y.2d 723, 726, 480 N.Y.S.2d 195, 469 N.E.2d 516). Neither exception applied in this case. At the fact-finding hearing, the expert testified that material portions of his opinion were based not only upon his interviews with the parties, but also were based on his interviews with collateral sources. The Appellate Division was unable to determine the extent to which the expert relied on those collateral source interviews in forming his opinion. Furthermore, the collateral sources did not testify at trial, and there was no evidence establishing their reliability. The court could not conclude that the admission of the expert's opinion was harmless error because, without the admission of that opinion or the testimony of the collateral sources, there was insufficient evidence in the record to support the court's determination. It reversed the order and remitted the matter to Family Court for a new hearing before a different adjudicator.

 

In Mahoney-Buntzman v Buntzman, --- N.Y.3d ----, 2009 WL 1227875 (2009) the Court of Appeals held that payments made to a former spouse and/or children of an earlier marriage, even if made pursuant to court order, are not the type of liabilities entitled to recoupment. In addition, it held that a student loan, which is both incurred and fully paid for during marriage, is a marital obligation for which responsibility is to be shared between the parties. It also held that as a matter of public policy, a "party to litigation may not take a position contrary to a position taken in an income tax return." (Click here for expanded discussion)

 

In Johnson v Chapin, - N.Y3d -, 2009 WL 1227869 (2009) the Court of Appeals, in an opinion by Judge Pigott, held that when a pendente lite award of maintenance is found at trial to be excessive or inequitable, the Court may make an appropriate adjustment in the equitable distribution award. However, it rejected the husband's claim that he should be entitled to a credit for excess child support payments pointing out that it has long been held that there is a "strong public policy against restitution or recoupment of support overpayments". (Click here for expanded discussion)

 

 

 

Failure to Provide “Paper Trail” Documenting Source of Money Used to Purchase Marital Residence Not Fatal to Separate Property Claim. Court Did Not Violate DRL 248 by Ordering That Maintenance Would Terminate in the Event That Wife Resided with an Unrelated Adult Male for More than 30 Days

In Juhasz v Juhasz, --- N.Y.S.2d ----, 2009 WL 281303 (N.Y.A.D. 4 Dept.) the parties were married in 1990 and had three minor children. The Appellate Division held that Supreme Court properly determined that a brokerage account with Julius Baer (JB account) was defendant's separate property inasmuch as it was funded entirely from defendant's premarital sale of stock in a family business. The court erred in failing to credit defendant for his contribution of separate property toward the purchase of the marital residence. A spouse is entitled to a credit for his or her contribution of separate property toward the purchase of the marital residence, including any contributions that are directly traceable to separate property. Before the marriage, defendant purchased a home for $240,000 with funds that he derived from his sale of the stock. During the marriage, defendant contributed $200,000 from the JB account to purchase a vacation home for approximately $450,000, and he secured a mortgage for the balance. That mortgage was also paid with funds from the JB account. The parties subsequently sold both homes and purchased the marital residence for $216,000. The Appellate Division concluded that defendant was entitled to a credit of $216,000 for his contribution of separate property to purchase the marital residence, and modified the amended judgment accordingly. While defendant did not provide a paper trail documenting the source of the money used to purchase the marital residence, nothing in either party's testimony suggested that any other possible source for the money existed. In view of its determination concerning defendant's entitlement to a credit for separate property with respect to the marital residence, the Appellate Division rejected the contention of plaintiff on her cross appeal that she should have been awarded title to the marital residence as a matter of equity. It also rejected defendants contention that he was entitled to a credit for separate property that he contributed for renovations to the marital residence. Although the marital residence was appraised for $420,000 four months prior to the trial, defendant failed to establish that the separate property funds spent on renovations added value to the residence apart from the appreciation in value resulting from market forces over the period of ownership and, if so, the amount by which the value of the property was increased. It also held that Supreme Court properly imputed income to defendant of $180,000 per year. The record established that defendant derived substantial income from his investments. The amount awarded for child support was vacated because the court failed to articulate any basis for that portion of the award based on the parental income exceeding $80,000. It modified the amended judgment by vacating that amount, and remitted the matter to Supreme Court to determine defendant's child support obligation in compliance with the Child Support Standards Act. It concluded that the court properly ordered defendant to continue to pay for the private school education of the children. It also rejected the contention of plaintiff on her cross appeal that the court violated Domestic Relations Law 248 by ordering that maintenance would terminate in the event that she resided with an unrelated adult male for more than 30 days. That section, entitled "Modification of judgment or order in action for divorce or annulment," provides in relevant part that a husband may apply for modification of a judgment of divorce if the wife remarries or if she is "habitually living with another man and holding herself out as his wife, although not married to such man." The court held that here it was concerned with an initial award of maintenance and not an application to modify an existing judgment or order. Inasmuch as courts have the discretionary power to "fashion a fair and equitable maintenance award" it concluded under the circumstances of this case that the condition imposed by the court is not improper (cf. Florio v. Florio, 25 AD3d 947, 950).

 

Misrepresentation That Husband Was Biological Father Did Not Constitute "Egregious Fault"

In Howard S. v. Lillian S., --- N.Y.S.2d ----, 2009 WL 674133 (N.Y.A.D. 1 Dept.) the Appellate Division, in an opinion by Justice Freedman, held that defendant-wife's alleged misrepresentation to her husband that he was the biological father of one of their children, when in fact the child was conceived during her adultery and fathered by her lover, did not constitute "egregious fault" sufficient to be considered in equitably distributing the marital property. According to the verified complaint plaintiff married defendant in May 1997 and they had four children. In February 2004, defendant had an extramarital affair with an unnamed man and became pregnant with a child, Charles, who was born in December 2004. Plaintiff contended that defendant knew or should have known that plaintiff was not Charles's biological father, but concealed that information from him. Plaintiff stated that he "raised Charles as his own child, nurturing him and providing the same financial and emotional support as all his other children." The complaint alleged that in February 2007 defendant began another affair with the named co-respondent which "continues to this day." Defendant also concealed this second adulterous relationship from plaintiff, but in the spring of 2007, she suggested that they separate and enter into a collaborative law process. During this period plaintiff had become suspicious about Charles's parentage, allegedly "due to all the jokes within his and [defendant's] circle of family and friends that Charles looked nothing like him." Without telling his wife, plaintiff in February 2008 arranged for a DNA test of himself and Charles. The test confirmed that plaintiff was not Charles's biological father. Defendant acknowledged that plaintiff was not Charles's biological father, but claimed that she learned this from the DNA test results and denied that she deliberately concealed the truth about Charles's parentage from plaintiff. The complaint asserted causes of action for divorce based on both cruel and inhuman treatment and adultery, and asserts a separate claim based on fraud. As damages for the fraud claim, plaintiff sought to recover his child support expenses for Charles, the fees for the parties' collaborative law process, and profits from the couple's investments "from the time of Charles's conception until the commencement of this action." Defendant answered and counterclaimed for divorce on the ground of abandonment. Defendant moved for an order dismissing or severing the fraud claim; plaintiff cross-moved for "expanded discovery" to prove "defendant's egregious fault," the fraud claim, and her lack of contribution to and dissipation of the marital property. The motion court denied the motion to dismiss or sever the fraud claim, but limited the recoverable damages to plaintiff's share of the fees for the collaborative law process. The court also denied plaintiff's cross motion for expanded discovery as to defendant's marital fault on the ground that defendant's alleged misconduct did not constitute egregious fault and had no bearing on prospective spousal maintenance and equitable distribution.          The Appellate Division pointed out that marital fault may be considered pursuant to clause(d)(13) of DRL 236 (B)(5), the "catchall" provision that allows the court to take "anyother factor" which may be "just and proper" into account. Marital fault can only be considered where the misconduct "is so egregious or uncivilized as to bespeak of a blatant disregard of the marital relationship-misconduct that shocks the conscience' of the court, thereby compelling it to invoke its equitable power to do justice between the parties. In Havell v. Islam, 301 A.D.2d 339, 344 [2002], the Court adopted the analysis set forth in McCann v. McCann (156 Misc.2d 540 [1993] ), and concluded that to be deemed egregious, the conduct must callously imperil the value our society places on human life and the integrity of the human body. It noted that the only cases in which reprehensible behavior has been deemed to constitute egregious fault sufficient to affect equitable distribution have involved extreme violence. It noted that egregious fault had also been found in instances of rape, and protracted and severe physical abuse. Conversely, conduct that courts have found not to be egregious include adultery, alcoholism, abandonment , and verbal harassment coupled with several acts of minor domestic violence. Here, defendant's alleged misconduct did not rise to the level of egregious fault, since defendant neither endangered the lives or physical well-being of family members, nor deliberately embarked on a course designed to inflict extreme emotional or physical abuse upon them. The court held that given the absence of egregious fault, the motion court correctly precluded any disclosure in connection withdefendant's marital fault. Justice Nardelli dissented in an opinion.

 

Second Department Disagrees With First Department Holding No Appeal lies from Maintenance and Property Distribution Granted on Default in Appearing for Trial.

In Sarlo-Pinzur v Pinzur, --- N.Y.S.2d ----, 2009 WL 387201 (N.Y.A.D. 2 Dept.) Supreme granted the husband's attorney's motion to withdraw as counsel and refused to adjourn the trial further following counsel's withdrawal. Upon his subsequent default in appearing at the trial able distribution, Supreme Court awarded the wife maintenance of $500 per month for four years and equitably distributed the marital property. The Appellate Division dismissed the appeal from the judgment, except insofar as it brought up for review the granting of the husband's attorney's motion to withdraw as counsel and the denying of the husband's request to adjourn the trial, in effect, pursuant to CPLR 321(c). It held that the judgment from which the husband appealed was entered on default, since he left the courtroom as the trial commenced. Although no appeal lies from a judgment entered on the default of the appealing party (CPLR 5511), an appeal from such a judgment does bring up for review those 'matters which were the subject of contest' before the Supreme Court. Here, those matters consisted of the granting of the motion of the husband's attorney to withdraw as counsel and the Supreme Court's denying of the husband's request to adjourn the trial, in effect, pursuant to CPLR 321(c). It pointed out that as a general rule, CPLR 321(c) requires that there be a 30-day stay of all proceedings after counsel is permitted to withdraw over the client's objection. Where, however, the attorney's withdrawal is caused by a voluntary act of the client, the court has the discretion to permit the matter to proceed without such a stay. The husband's counsel moved for leave to withdraw on the ground that the husband had refused to provide financial information necessary to the trial of the case. The motion was properly granted on the basis of the husband's failure to cooperate with his counsel. Supreme Court providently exercised its discretion in refusing to adjourn the trial further. COMMENT: In Warner v Houghton, 43 A.D.3d 376, 841 N.Y.S.2d 499 (1st Dept., 2007), affirmed 10 N.Y.3d 913, 862 N.Y.S.2d 321 (2009) defendant did not appear at a compliance conference and the matter was set down for an inquest on the issue of equitable distribution. After the inquest, at which he did not appear, the court granted a divorce, and made awards concerning the request for equitable distribution and counsel fees. The Appellate Division held that while the issue of whether the divorce was properly granted may not be reviewable, the distribution award was a separate issue, and was still subject to review, even after a default. It found that the defendant was improperly precluded and modified the awards. On review of submissions pursuant to 22 NYCRR 500.11 the Court of Appeals held that CPLR 5511 does not bar review of the equitable distribution components of a divorce judgment where, as here, defendant was improperly precluded from contesting the awards. It held that the Appellate Division did not abuse its discretion as a matter of law in vacating Supreme Courts preclusion order.

 

Failure to Recoup Value from Unprofitable Business Operated During Marriage Constitutes Wasteful Dissipation of That Asset

In Scala v Scala, --- N.Y.S.2d ----, 2009 WL 281681 (N.Y.A.D. 4 Dept.) Plaintiff appealed from a judgment of divorce that confirmed the report of the Matrimonial Referee appointed to hear and report and ordered plaintiff husband to pay maintenance to defendant wife. Plaintiff contended that the Referee erred in precluding him from testifying concerning the nature of his alleged physical injuries based on his willful failure to furnish requested medical authorizations. The Appellate Division rejected that contention, and concluded under the facts and circumstances of this case that the Referee neither abused nor improvidently exercised his discretion in precluding that testimony. Plaintiff further contended that Supreme Court erred in confirming the Referee's report both to the extent that the Referee found that the closure by plaintiff of his masonry business constituted a wasteful dissipation of assets and to the extent that the Referee valued the business. With respect to wasteful dissipation, the Court pointed out that it had previously stated that the failure to recoup value from an unprofitable business operated during the marriage constitutes wasteful dissipation of that asset (see Baker v. Baker [appeal No. 2], 199 A.D.2d 967, 968). Thus, it necessarily is a wasteful dissipation of assets to fail to recoup the value of a profitable business, such as plaintiff's masonry business. It also rejected the contention with respect to the valuation of the masonry business. The determination of a fact-finder as to the value of a business, if it is within the range of the testimony presented, will not be disturbed on appeal where valuation of the business rested primarily on the credibility of expert witnesses and their valuation techniques. The Referee, whose report was adopted by the court, credited the conclusion of defendant's expert with respect to the value of the business, and plaintiff presented no expert testimony that would support a different valuation. It agreed with plaintiff, however, that the court erred in awarding nondurational maintenance to defendant. Based on the statutory factors, including the parties' respective ages and financial circumstances, it concluded that defendant was entitled to maintenance for 12 years from the date of the judgment.

 

Nontitled Party Seeking a Distributive Share of Enhanced Earnings Resulting from Law Degree and License must Demonstrate That They Made a Substantial Contribution to the Titled Party's Acquisition of That Marital Asset

In Kriftcher v Kriftcher, --- N.Y.S.2d ----, 2009 WL 262707 (N.Y.A.D. 2 Dept.) Supreme Court awarded the plaintiff wife $828,699.20 as her 40% share of the husbands enhanced earning capacity, an attorney's fee of $30,000, declined to award her maintenance, awarded her $1,229.71 per week in child support, and failed to award her equitable distribution of the husband's bonus for the calendar year 2005, which the husband received in 2006. The Appellate Division found that Supreme Court correctly concluded that the enhanced earnings resulting from the law degree and license obtained by the husband during the marriage were marital property subject to equitable distribution. Nevertheless, it is incumbent upon the nontitled party seeking a distributive share of such assets to demonstrate that they made a substantial contribution to the titled party's acquisition of that marital asset and where only modest contributions are made by the nontitled spouse toward the other spouse's attainment of a degree or professional license, and the attainment is more directly the result of the titled spouse's own ability, tenacity, perseverance and hard work, it is appropriate for courts to limit the distributed amount of that enhanced earning capacity. Here, the wife's minimal contributions to the husband's obtaining of his degree and license entitled her to a share of only 10% in the enhanced earnings that have resulted. Supreme Court also erred in failing to distribute the husband's bonus for the calendar year 2005, which he received in March 2006 and was in the gross sum of $360,000. Based upon the unrebutted testimony of the forensic expert, the husband's effective income tax rate was 38.25%, and, therefore, the net amount of the husband's bonus was the sum of $222,300. Since the divorce action was commenced on June 28, 2005, the marital portion of that asset was 50% of its net value, or $111,150. Considering all of the statutory factors the wife's equitable share of that marital asset was fixed at 50%, or $55,575. In determining the appropriate amount and duration of maintenance, the court is required to consider, among other factors, the standard of living of the parties during the marriage and the present and future earning capacity of both parties . (Haines v. Haines, 44 A.D.3d 901, 902, 845 N.Y.S.2d 77). Although the wife earned a teaching license during the course of the marriage, she was, at present, primarily a homemaker, who worked only part-time as a substitute teacher earning approximately $10,000 per year. In sharp contrast, the husband was an attorney making approximately $500,000 per year. It held that a maintenance award of $1,000 per week for 10 years was appropriate.

 

Maintenance Provisions and Interest on Promissory Note Provided in Separation Agreement Set Aside as Unconscionable

In Santini v Robinson, --- N.Y.S.2d ----, 2008 WL 5376525 (N.Y.A.D. 2 Dept.) the parties were married in 1973, and had three children. Their principal assets included their approximately $100,000 equity interest in the marital residence, their Individual Retirement Account and joint bank accounts, the plaintiff's deferred compensation plan, and his future retirement pension, valued at more than $242,000. The plaintiff left the marital residence in July 1991, and in November 1991 the defendant commenced the underlying action for a divorce. The parties entered into a separation agreement dated January 9, 1992. The defendant was represented by an attorney in connection with the negotiation of the separation agreement, while the plaintiff represented himself. At that time, the plaintiff was 42 years old and employed by the County Sheriff's Department, while the defendant was 41 years old, unemployed, and legally blind, albeit able to work part-time and receiving Social Security disability benefits. The parties visited the defendant's attorney twice in connection with the separation agreement, and the attorney advised the plaintiff repeatedly, both in writing and orally, that he should retain separate counsel. The plaintiff testified that he voluntarily signed the agreement on January 9, 1992, although he merely "scanned" the agreement and had not understood the provisions that he read. The agreement prepared by counsel contained the general terms previously agreed upon between the parties during their own negotiations. The separation agreement provided that the marital residence subject to the mortgage, the IRAs and joint bank accounts, and the plaintiff's deferred compensation plan in the form of promissory notes would be distributed to the defendant and that she would receive child support and lifetime maintenance even upon remarriage. Further, the agreement provided that the maintenance payment would be increased by a percentage each time one of the children was emancipated and by an additional 4% per annum. The plaintiff retained his pension, his automobile, some bank accounts, and certain furniture. The agreement was incorporated, but not merged, into a 1992 judgment of divorce. In 1998 the defendant remarried. In March 2000, the plaintiff commenced the action to set aside the separation agreement as unfair, inequitable, and unconscionable. After the Appellate Division reversed an order granting summary judgment dismissing the complaint on the issues of unconscionability and ratification (see Santini v. Robinson, 306 A.D.2d 266), and following that hearing, the Supreme Court, set aside the provisions of the parties' separation agreement awarding the defendant 100% of the plaintiff's deferred compensation and the parties' IRAs, terminated the defendant's exclusive possession of the marital home, limited the plaintiff's obligation for college expenses of the parties' three children to $15,000 per year, terminated the defendant's lifetime maintenance as of the date of her 1998 remarriage, awarded a money judgment to the defendant for all interest payable on a $19,000 promissory note dated January 9, 1992, and awarded a credit of $33,488 to the plaintiff for his maintenance payments after the defendant's remarriage. The Appellate Division modified. It held that Supreme Court erred in setting aside the parties' entire separation agreement as unconscionable since the equitable distribution of the marital property was not manifestly unjust. Pursuant to the separation agreement, the defendant was awarded, inter alia, the marital residence and most of its contents, the IRAs and the payment of certain promissory notes by the plaintiff, while the plaintiff retained his pension, his car, and some furniture. The plaintiff acknowledged at trial that he was willing to give the defendant everything as long as he retained his pension. Any inequity in this property division was not "so strong and manifest as to shock the conscience and confound the judgment" of this Court (Christian v. Christian, 42 N.Y.2d at 71) Accordingly, these provisions of the separation agreement were reinstated, except as provided in the decision. The Appellate Division agreed with the Supreme Court that the interest provision in the promissory note and the lifetime escalating maintenance provisions were unconscionable (citing Tartaglia v. Tartaglia, 260 A.D.2d at 629; Yuda v. Yuda, 143 A.D.2d at 659). The plaintiff executed a promissory note for $19,000 in the defendant's favor with an annual interest rate of 9%, which represented her one-half portion of the plaintiff's unused vacation and sick time. Although the unused vacation and sick time were not in "Pay Out" status until the plaintiff's future retirement, the note provided that the annual 9% interest would accrue immediately upon execution. This interest provision was manifestly unjust. Furthermore, the plaintiff was obligated to pay child support and all college expenditures for three children, as well maintenance payments which increased each year during the defendant's lifetime. The lifetime nature of the maintenance and its 4% increase each year for the rest of the defendant's life, on top of a percentage increase following the emancipation of each of their children, represented a sum far in excess of the value of the plaintiff's marital distribution. Testimony elicited at trial revealed that by the time the plaintiff was 65 years of age, he would be exhausting his primary marital asset by giving the defendant almost one half of his yearly pension. This Court found "that no reasonable and competent person would have consented to" this lifetime escalating maintenance provision. Contrary to the Supreme Court's termination of the defendant's maintenance upon her remarriage, a maintenance period of 16 years, from the 1991 commencement of the matrimonial action to the 2007 order and judgment appealed herein, was more appropriate under the extant circumstances and in accordance with Domestic Relations Law 236(B)(6)(a). Given this determination, the plaintiff was not entitled to any recoupment of maintenance he paid between 1998 and 2007.

 

In Light Of Parties Long Separation Prior to Divorce, Standard of Living Not a Consideration in Awarding Maintenance.

In Dowd v Dowd, --- N.Y.S.2d ----, 2009 WL 139210 (N.Y.A.D. 3 Dept.) the parties were married in 1976, separated in 1999 and divorced in 2007. During the lengthy separation, defendant was ostensibly supported, in part, by her live-in boyfriend. Her sporadic employment history involved low-wage jobs. Of their four children, only a 17-year-old daughter remained unemancipated at the time of divorce and she resided with plaintiff. Neither party graduated from high school. At the time of trial, plaintiff earned roughly $60,000 per year working for a manufacturer of heavy equipment. Supreme Court directed plaintiff to pay maintenance of $500 per month until defendant is eligible for Social Security retirement benefits at age 62 in 2019 and, thereafter, at a reduced rate of $250 per month until she is eligible for health care through Medicare at age 65 in 2022, at which time maintenance ceases. The Appellate Division modified by reversing so much of the judgment as awarded defendant monthly maintenance of $500 until 2019, when she reaches age 62, and $250 until 2022, when she reaches age 65. Defendant was awarded monthly maintenance of $500 for a period five years from the date of entry of Supreme Court's judgment. It held that the purpose of maintenance is to provide financial support for the recipient spouse while he or she gains the skills and employment necessary to become self-sufficient. It noted that in light of the long separation of the parties prior to the divorce action, the standard of living during the marriage was not a consideration. The marital residence was the only property of significant value and it was essentially divided equally, with defendant receiving a distributive award of $100,000. Plaintiff was 50 years old, healthy and had a job that he would likely be able to continue for the rest of his working life. Defendant was 49 years old and had a similar educational background as plaintiff. While she had a sporadic employment history, there was no reason that she should not be able to obtain a modest and sustainable level of income within a reasonable time. Her purported health problems were not supported by competent medical proof. She had no responsibility for any unemancipated children and had lived independently of plaintiff for a considerable period of time. During the long separation, plaintiff provided the primary support to the children and also dealt with the marital debt. Two Justices Dissented.

 

Appellate Review and Review By Family Court Not Precluded by Failure to Timely File Objections. Strict Adherence to the Deadlines of Family Court Act 439(e) is not required

In Matter of Latimer v. Cartin,-- N.Y.S.2d ----, 2008 WL 5352279 (N.Y.A.D. 3 Dept.) the father filed a petition for downward modification of his child support obligation on the basis of the surrender of his medical license and a subsequent loss of income and earning capacity. Following a hearing, the Support Magistrate concluded that the father had failed to meet his burden of proving an involuntary and unavoidable change in financial circumstances or that he made reasonable and diligent efforts to obtain employment, and declined to downwardly modify his support obligation on these grounds. Family Court denied the father's objections to the Support Magistrate's order. The Appellate Division considered the father’s appeal, rejecting the mother's contention that appellate review was precluded due to the father's failure to timely file objections to the Support Magistrate's order. It held that strict adherence to the deadlines of Family Court Act 439(e) is not required and it did not find Family Court's decision to review the merits of the father's objections, which were filed one day after the statutory deadline, to have been an abuse of discretion.

 

Wife's Inability to Testify with Specificity as to How She Spent the Proceeds of Loan Suggested She Dissipated Marital Assets in Contemplation of Divorce.

In Abrams v Abrams, --- N.Y.S.2d ----, 2008 WL 5376644 (N.Y.A.D. 2 Dept.) the Appellate Division pointed out that "The overriding purpose of a maintenance award is to give the spouse economic independence, and it should be awarded for a duration that would provide the recipient with enough time to become self-supporting". It held that the trial court properly awarded the former wife maintenance, but it improvidently exercised its discretion in extending the duration of the maintenance award beyond five years, and concluded that an award of $2,500 per month for five years was appropriate. It also found that the former husband correctly contended that he was entitled to a portion of the proceeds of a home equity loan that the wife obtained with respect to certain investment residential property, especially in light of the wife's inability to testify with specificity as to how she spent the proceeds of that loan. This suggested that the wife dissipated these marital assets in contemplation of divorce. The judgment was modified to award the husband a credit which represented his share of the proceeds of that loan, after accounting for the taxes paid by the wife on both the marital residence and the investment residential property. It noted that a parent has no legal obligation to provide for or contribute to the support of a child over the age of 21 Therefore, the court erred

 

Improper to Include Future Maintenance Payments as Part of Defendant's Income for Purposes of Calculating Child Support

In Simon v Simon, --- N.Y.S.2d ----, 2008 WL 4736658 (N.Y.A.D. 1 Dept.) the Appellate Division deleted the award of child support and included an award of health insurance coverage separate from plaintiff's other maintenance obligations, and remanded the matter to the trial court for a recalculation of the parties' respective child support obligations, and for a finding as to the cost of health insurance for defendant at the predivorce level of coverage. The Appellate Division held that while no basis existed to disturb the trial court's crediting of plaintiff's testimony regarding the reduction in his income and its resulting finding that the parties' predivorce lifestyle cannot be supported by their present combined income, under the circumstances, including the disparity in the parties' future earning capacity and defendant's ongoing health problems, the court should have directed that plaintiff pay defendant the cost of private health insurance, in addition to his regular nondurational maintenance obligation of $10,000 per month. As the record did not permit a finding as to the cost of such health insurance, it remanded for a determination thereof and for a recalculation of child support, required because the court improperly included future maintenance payments as part of defendant's income (see Huber v. Huber, 229 A.D.2d 904 [1996] ). It directed that upon recalculation, the trial court should deduct from the plaintiff's income the amount he pays in maintenance, but should not add the same amount to defendant's income (see Tryon v. Tryon, 37 A.D.3d 455 [2007] ).

 

Where Mutual Mistake Rendered Portion of Agreement Impossible Relevant Provision Was Reformed

In Banker v Banker, --- N.Y.S.2d ----, 2008 WL 4999166 (N.Y.A.D. 3 Dept.) the parties oral stipulation of settlement, which was incorporated but not merged into their 2005 divorce judgment, provided that the parties would subdivide a parcel of property located in Delaware County. In response to a motion by plaintiff to enforce the stipulation, Supreme Court, in February 2006, ordered defendant to, obtain subdivision approval from the Town. The Planning Board denied defendant's subsequent subdivision application upon discovering that the property was encumbered by a restrictive covenant against further subdivision. In March 2006, defendant moved to reargue and/or renew Supreme Court's February 2006 order and requested a hearing to determine equitable distribution. Supreme Court reserved decision on all pending matters pertaining to the parties until an appraisal of the property was completed. Because the parties could not agree on an appraiser, the court appointed one and challenged the parties, once the appraisal was complete, to settle the matter in a private auction or buyout. The appraiser completed two appraisals in June 2006. By letter dated October 4, 2006, defendant requested the opportunity to offer further proof of value. Defendant made a similar request and explained that the parties had not been able to settle the matter or agree on a private auction. Plaintiff responded with a motion seeking that the parties' interests in the property be declared in conformance with the terms set forth in the stipulation and the values established in the appraisal, as well as an order allowing her to buy out defendant's share of the property. Defendant opposed the motion, arguing that the appraisal should not be adopted without an opportunity by the parties to cross-examine the appraiser and submit other evidence of valuation. Supreme Court ordered a hearing to permit the parties to cross-examine the appraiser, but made it clear that no other testimony or evidence of valuation would be permitted. Following the hearing, at which Supreme Court again denied defendant's request to submit further evidence, the court determined the interests of the parties in the property to be 83% for plaintiff and 17% for defendant. The court, fixed the parties' interests as indicated above, appointed a receiver, and ordered the public sale of the property. Defendant appealed. The Appellate Division rejected defendant's argument that Supreme Court exceeded its authority by reforming the parties' stipulation of settlement. Where, as here, a mutual mistake rendered a portion of the parties' settlement agreement impossible or impracticable, "the relevant settlement provision was properly set aside" (Brender v. Brender, 199 A.D.2d 665, 666 [1993] ). No dispute existed that the parties' agreement to physically divide the property cannot occur given the restrictive covenant; indeed, defendant was not attempting to have the parties' stipulation enforced. Thus, after giving the parties ample opportunity to reach a new agreement, there was no error in Supreme Court's decision to move forward by appointing an appraiser so that an equitable distribution of the property, in as close accordance as possible with the intent of the parties as expressed in their settlement, could be achieved. The Court noted that to achieve reformation or recision of the stipulation of settlement, one of the parties should have commenced a plenary action, rather than proceeding by motion (see Brender v. Brender, 199 A.D.2d at 666 n. 2, 605 N.Y.S.2d 411) but, in the context of this matter, concluded the defect to be nonfatal. There was merit, however, in defendant's argument that the issue should not have been resolved without a full hearing permitting the parties to offer proof of valuation. The court is authorized to appoint an independent appraiser in a matrimonial action ( Domestic Relations Law 237; 22 NYCRR 202.18) but, unless the parties have stipulated otherwise, the court must afford the parties the opportunity to review the appraisal, cross-examine the appraiser and offer additional evidence on valuation. Although the record contained evidence that the parties consented to Supreme Court's appointment of the appraiser, it did not suggest that the parties agreed to be bound by the resulting appraisal. The order was reversed, on the law, and matter remitted to the Supreme Court for a full evidentiary hearing to determine the valuation of the parcels identified in the parties' stipulation of settlement.

 

In Van Kipnis v Van Kipnis, --- N.Y.3d ----, 2008 WL 5244630 (N.Y.) the Court of Appeals held that the parties French Prenuptial Agreement Opting out of their "Community Property" scheme in favor of a "Separation of Estates" regime constituted a waiver of Equitable Distribution. It also held that it was error to preclude the wife from recovering Counsel Fees to Oppose the husbands affirmative defense predicated on the prenuptial agreement. (Click here for expanded discussion)

 

New Attorney Conduct Rules, Effective April 1, 2009.

On December 17, 2008 Chief Judge Judith S. Kaye and the Presiding Justices of the Appellate Division announced new attorney conduct rules, effective April 1, 2009. The Rules of Professional Conduct, which will replace the existing Disciplinary Rules, introduce a number of important ethics changes for New York lawyers and are based on the ABA Model Rules. (Click here for highlights of significant ethics changes contained in the new Rules of Professional Conduct)

 

 

DRL 240 (1-b) Applies Only to Basic Child Support, Which Does Not Include College Expenses

In Colucci v Colucci, --- N.Y.S.2d ----, 2008 WL 4170019 (N.Y.A.D. 2 Dept.) the plaintiff mother and the defendant father, who had two children were divorced in 1997. In their stipulation of settlement, which was incorporated but not merged into the judgment of divorce they agreed to be bound by, and for the stipulation to comply with, the provisions of the Child Support Standards Act (Domestic Relations Law 240[1-b]; Family Ct Act 413[1][b] ). The stipulation provided, under the section entitled "CHILD SUPPORT," that the father must pay the mother a set amount per month in basic child support, which amount was determined in accordance with the CSSA. The stipulation of settlement further provided, in the child support section, that the parties are to share on a pro rata basis any child care expenses incurred by the mother that are necessary for her work or for school leading to work, as well as the costs associated with the children's extracurricular activities. The stipulation of settlement also provided, in the child support section, that the parties are to exchange their federal income tax returns annually in order to make any necessary adjustments to the father's basic child support obligation and to the parties' pro rata basis underlying the amount of child support that would be due under the CSSA. Under a separate section of the stipulation of settlement entitled "COLLEGE EXPENSES," the father agreed to be solely responsible for the children's college education expenses. In June 2007, 10 years after the stipulation was executed and 2 months before the older child was to start college, the father moved, inter alia, for a downward modification of his obligation to pay for the children's college education expenses. Claiming that his income had decreased and the mother's had increased since the divorce, the father asked the Supreme Court to "reallocate" the parties' respective obligations with respect to the children's college education expenses, based on the parties' current incomes, so that he would pay 62% of the expenses, and the mother would pay the remainder. In opposition, the mother contended that, in accordance with the stipulation of settlement, the parties agreed that the father would pay 100% of the children's college education expenses regardless of any change in the parties' income. Concluding that there was a "change in circumstances," and purporting to take into account the best interests of the children, the Supreme Court granted that branch of the father's motion which was for a downward modification of his obligation to pay the children's college education expenses, to the extent of directing the father to pay 75% of those expenses. The Appellate Division reversed. It held that the terms of a separation agreement "incorporated but not merged into a judgment of divorce operate as contractual obligations binding on the parties" (Matter of Gravlin v. Ruppert, 98 N.Y.2d 1, 5). Further, a matrimonial settlement is a contract subject to principles of contract interpretation .and a court should interpret the contract in accordance with its plain and ordinary meaning. Where a matrimonial settlement "is clear and unambiguous on its face, the parties' intent must be construed from the four corners of the agreement, and not from extrinsic evidence. Here, the parties' stipulation of settlement expressly obligated the father to pay 100% of the children's college education expenses, in addition to, and separate and apart from, his obligation to pay child support. Notably, the provision in the stipulation requiring the father to pay 100% of the children's college education expenses is set forth in a section of the stipulation separate from the section containing his obligation to pay child support, and the two sections do not reference each other in any manner. Significantly, only the section pertaining to child support contains provisions regarding reallocation of the parties' respective obligations should there be any change in the income of either one. Under the circumstances, it was apparent that the parties agreed that college education expenses would not constitute a component of their obligation to pay basic child support. It was also apparent from the stipulation of settlement that the parties intended that the father's obligation to pay 100% of the children's college education expenses was not subject to modification based on any change in the parties' respective incomes. While Domestic Relations Law s 240(1- b)(h) requires stipulations and agreements to contain a provision that the parties were advised of the CSSA and knowingly "opted-out" of its provisions that provision specifically applies only to "[b]asic child support," which generally does not include college education expenses. Under such circumstances, there was no basis for the court to interfere with the parties' contractual agreement requiring the father to pay 100% of the children's college expenses.

 

Ability to Become Self-supporting with Respect to Some Standard of Living Does Not Obviate Need to Consider Predivorce Standard of Living. Voluntary Payment of Tuition May Not Be Recouped or Credited Against Pendente Lite Child Support

In Ruanne v Ruanne, --- N.Y.S.2d ----, 2008 WL 4491472 (N.Y.A.D. 2 Dept.) the parties were married in 1986 and had three children. In May 2003 the plaintiff commenced the action for divorce. The Appellate Division held that in determining the appropriate amount and duration of maintenance, the court is required to consider, among other factors, the standard of living of the parties during the marriage and the present and future earning capacity of both parties. While the Supreme Court properly found that the defendant was capable of returning to work and re-establishing her business, the wife's ability to become self-supporting with respect to some standard of living in no way obviates the need for the court to consider the predivorce standard of living. The maintenance award of $6,000 per month for eight years would permit the defendant to maintain a semblance of the predivorce standard of living while allowing her a reasonably sufficient time to become self-supporting. The Supreme Court properly denied those branches of the plaintiff's motion, made in April 2004 and referred to trial, which were, in effect, for a downward modification of his pendente lite support obligation and for a credit against support arrears for tuition payments made to the school of the two youngest children. Modifications of pendente lite awards should be sparingly made and then only under exigent circumstances such as where a party is unable to meet his or her own needs, or the interests of justice otherwise require relief. While the papers submitted on the motion demonstrated that the plaintiff's salary declined in 2003, the evidence adduced at trial established that he also accumulated over $100,000 in capital gains during that year. Accordingly, the plaintiff had the resources available to sufficiently provide for his family as established in the pendente lite award. Further, the pendente lite order did not address the issue of tuition payments for the children's school. Accordingly, the plaintiff's voluntary payment of tuition may not be recouped or credited against amounts owing under the order (Horne v. Horne, 22 N.Y.2d 219) In distributing the marital assets, the Supreme Court providently exercised its discretion in characterizing a life insurance policy and margin account as active assets and valued them as of the date of commencement of the action. The plaintiff depleted those assets during the pendency of the action, the majority going toward the purchase and furnishing of his new home and the installation of a new driveway and basketball court. Their decrease in value was thus due to the plaintiff's decisions and not mere market fluctuations.

 

Absent Express Finding of Willfulness Prejudgment Interest Improperly Imposed. When Findings of Support Magistrate Are Insufficient Family Court May Consider Affidavits and Other Submissions Without Holding a Hearing

 

In Matter of Regan v Zalucky, --- N.Y.S.2d ----, 2008 WL 4809541 (N.Y.A.D. 3 Dept.), the Family Court fixed the father's liability for arrears of child support and awarded interest at 9% per annum on each of his obligations. The Appellate Division reversed and remitted for further proceedings. It pointed out that once a money judgment has been ordered and entered, interest accrues until the judgment has been paid ( Family Ct Act 454[1]; 460[1]; CPLR 5003). Prejudgment interest can be ordered only after a finding of a willful disregard of a lawful court support order (Family Ct Act 460 [1]; Matter of Kaltwasser v. Kearns, 235 A.D.2d 738, 740 [1997] ). Despite the statutory mandate directing that a money judgment shall be ordered when any amount of child support arrears are established ( Family Ct Act 454[2][a]) it appeared that no money judgment had been ordered or entered. It did not appear that Family Court made any express finding of willfulness before imposing prejudgment interest. Absent such a determination, prejudgment interest was improperly imposed. In a footnote the Appelate Division rejected the father's contention that Family Ct Act 439(e) precludes Family Court, when it has concluded that the findings of the Support Magistrate are insufficient to render a final determination, from considering evidence in the form of affidavits and other submissions without holding a hearing. Where the court is endeavoring to fix amounts due on liability already established, and submissions are made on notice and with opportunity to respond, it found nothing to preclude Family Court, where possible, from rendering a final order based upon submissions.

 

Court of Appeals Holds Rule 202.48 Does Not Apply to Order Granted as Result of Unnecessary Motion Which Results in Order Granting Same Relief Previously Granted.

In Farkas v Farkas, — NY3d —, 10/24/2008 N.Y.L.J. 27, (col. 3) the Court of Appeals held that Rule 202.48 cannot deprive a party of a judgment where it has been improperly or unnecessarily invoked in the first place. The 'settle' or 'submit' trigger for the 60-day limitation of Rule 202.48(a) does not purport to govern the flow of the entry process, which is a ministerial recording function that is separate and distinct from the procedure of obtaining the court's signature on a proposed judgment. (Click here for expanded discussion)

 

Court of Appeals Rejects Interpretation of  Term "Cohabitation" in Parties Separation Agreement as Having Meaning which Contemplates "Changed Economic  Circumstances"

In Graev v Graev, —NY3d—, --- N.E.2d ----, 2008 WL 4620698 (N.Y.) the Court of Appeals rejected an interpretation of the term "Cohabitation" in the parties separation agreement as having a meaning which contemplates "changed economic  circumstances", or, is necessarily determined by whether a "couple shares household expenses or functions as a single economic unit". It held that no plain meaning could be ascribed to the term in the parties agreement, which provided for the termination of maintenance upon  the occurrence of any of four "termination events"; namely, the wife's remarriage or death, the husband's death, or "[t]he cohabitation of the Wife with an unrelated adult for a period of sixty (60) substantially consecutive days." The agreement did not define "cohabitation. The Court referred the matter back to the trial court to determine the meaning of the term after after a hearing. Rather than  articulating a "clear rule of law", which was hardly fair to those who may have used the word "cohabitation" in an extant separation agreement, intending the meaning ascribed to it by those Appellate Division cases requiring financial interdependence, it stated, in a footnote that the wisest rule is for parties in the future to make their intention clear by more careful drafting. (Click here for expanded discussion)

 

First Department, in Case of First Impression,  Holds that Value of Stock Owned By Husband Should Be Reduced By Embedded Taxes. Wife Awarded $27 million in Assets.

In Wechsler v Wechsler, --- N.Y.S.2d ----, 2008 WL 4635832 (N.Y.A.D. 1 Dept.) the issue was the extent to which the value of a holding company, Wechsler & Co., Inc. (WCI), a Subchapter C corporation, all the shares of which were owned by the husband, should be reduced to reflect the federal and state taxes embedded in the securities it owned. These securities constituted virtually all of its assets, due to the unrealized appreciation of those securities. As of the date the divorce action was commenced, the valuation date, WCI had ceased trading securities for the accounts of customers and bought and sold securities solely for its own account. All of the experts who testified agreed that WCI should be valued on a net asset basis by determining what a willing buyer would pay a willing seller, with neither being under a compulsion to buy or sell, and with both having reasonable knowledge of the relevant facts. The Appellate Division, in an opinion by Justice James M. McGuire, modified the judgment appealed from by the husband. It noted that Supreme Court adopted a "baseline" value of $70,848,107 on the date the action was commenced. That baseline value was determined by the neutral expert before any deduction for embedded taxes and then made adjustments to it that differed in various ways from the adjustments made by the neutral expert. The most significant adjustment was on the issue of the extent of the reduction for embedded taxes. Supreme Court rejected the approach of the Fifth Circuit in Matter of Dunn v Commissioner of Internal Revenue (301 F3d 339 [5th Cir2002] ), the approach embraced by the neutral expert. Pursuant to that approach, consistent with the assumption inherent in the net asset valuation methodology, an actual sale of the corporation's assets is assumed to occur on the valuation date. The value of the corporation is reduced on a dollar-for-dollar basis by the full amount of the tax liability that would arise from the sale of the assets by the hypothetical buyer on the valuation date. Both the neutral expert and the husband's expert testified, and the wife's expert did not dispute, that if the securities were sold as of the date of commencement, the effective tax rate would be 41.74% of the baseline value of $70,848,107. Under the valuation methodology adopted in Dunn, the date-of-commencement value of WCI would be reduced by $29,572,000 (41.74% of $70,848,107). Instead, Supreme Court accepted the approach of the wife's expert and reduced the baseline value of WCI by 11% of $70,848,107 ($7,793,292). That percentage approximated what Supreme Court and the wife's expert denominated the "historical" rate of the annual taxes paid by WCI, a rate determined by comparing the average annual taxes paid by WCI to its average annual gross revenue, i.e., its revenue before all applicable deductions for its various costs of doing business (including the salaries of its employees). At trial, Supreme Court was asked to choose between the approach of the Fifth Circuit and an approach different from the one advanced by the Commissioner in Jelke. The latter approach, the one Supreme Court adopted, did not attempt to ascertain the period of time over which the assets of a corporation would be sold by a reasonable buyer and discount the taxes that would be due over that period to present value as of the date of commencement. Rather, it adopts a baseline value of the assets as of the commencement date and reduces that value by an "historical" tax rate of the corporation. The Appellate Division rejected the approach of the wife's expert because it did not accord with common sense, conflicted with the reasoned testimony of both the neutral expert and the husband's expert and was without precedential support. The approach of the wife's expert assumed that the assets will not be sold as of the valuation date and that WCI would operate in the future as it had in the past so that each year it both would sell assets to the same extent it annually had sold assets in the past and would be able to offset income generated by the sale of assets with the same deductions for salaries and other expenses that it had been able to take in prior years. The assumption that WCI would continue to be able to take the same deductions for salaries was at least brought into question by proceedings in Tax Court that were pending as of the trial. Furthermore, the assumption that WCI would sell assets in the future to the same extent that it had sold assets in the past was even more questionable. Moreover, by also assuming that the securities owned by WCI will not depreciate in value over time, the approach of the wife's expert required the husband to bear all the risk of a decline in their value. The Appellate Division held that Supreme Court overvalued WCI by $21,778,708 (the difference between the $7,793,292 reduction in value based on the "historical" tax rate methodology and the $29,572,000 reduction that would result under the methodology adopted in Dunn ). The Appellate Division affirmed that part of the judgment of Supreme Court which declined to award permanent maintenance in part because the wife would be "vastly wealthy in her own right." The wife did not perfect her cross appeal, so there was no occasion to decide whether a permanent maintenance award would be appropriate in light of the reduction of the distributive award. The Court noted that Supreme Court awarded the wife over $27 million in assets, reflecting approximately 88% of the other marital assets. Supreme Court awarded conditional, durational maintenance to the wife, with the husband being obligated both to make monthly payments of $46,666 to the wife, a portion of which was deductible by the husband, and to pay various expenses, including the mortgage payments and taxes relating to the home awarded to the wife. Pursuant to the terms of the judgment, this maintenance award continues until the wife receives both the specific assets awarded to her and the first payment on account of the distributive award. Relying on it decisions in Gad v. Gad (283 A.D.2d 200 [2001] ) and Pickard v. Pickard (33 AD3d 2002 [2006], appeal dismissed 7 NY3d 897 [2006] ), the husband argued that because Supreme Court did not make a permanent maintenance award he was entitled to a credit against the distributive award in the amount of all the temporary maintenance payments he made. The husband contended that he paid a total of $3,000,987 in temporary maintenance. The Appellate Division held that the husband's reliance on Gad and Pickering was misplaced and that he was not entitled to any credit for the temporary maintenance payments he made, regardless of the amount of those payments. The mere determination by Supreme Court not to award permanent maintenance cannot be equated with a finding that the pendente lite maintenance award was excessive. Supreme Court did not make such a finding either expressly or implicitly. The determination not to award permanent maintenance was based in part on the ground that permanent maintenance was unnecessary given the wife's vastly different economic circumstances as a result of the equal distribution of the marital property. In addition, Supreme Court also based this determination on the consequences of the distribution of the overwhelming preponderance of the liquid marital assets to the wife. As a result, a permanent maintenance award would have required the husband to tap into the income generated by WCI or liquidate securities it owned even though he was awarded this asset. Accordingly, Supreme Court cogently observed that an award of permanent maintenance would entail an element of "double dipping" by the wife into the principal asset awarded to the husband. (Click here for extended discussion)

 

 

Evidence of False Allegations of Physical Abuse Which Interfere with Parental Rights, Is So Inconsistent with the Best Interests of the Child That it Raises, by Itself, a Strong Probability That the Offending Party Is Unfit to Act as a Custodial Parent

In Mohen v Mohen, --- N.Y.S.2d ----, 2008 WL 2609358 (N.Y.A.D. 2 Dept.) the Appellate Division found that Supreme Court's award of custody to the mother lacked a sound and substantial basis and had to be set aside. Supreme Court gave insufficient attention to facts and evidence that were of such significant collective magnitude as to warrant a custody determination in favor of the father. The Supreme Court found, with support in the record, that the mother, on at least one occasion, had filed false charges of physical abuse against the father. The mother made numerous false charges against the father. There were four incidents of physical abuse accusations by the mother against the father, in August 2004, December 2004, January 2005, and December 2005. All of the Family Court petitions, when filed, apparently were withdrawn or dismissed. All of the mother's reports to child protective authorities were investigated and determined to be "unfounded." Moreover, expert medical testimony in the record strongly suggested that, regarding the January 2005 alleged incident, the mother manufactured proof of physical injury to herself. She admitted to the forensic examiner, and confirmed at trial, that the January 2005 incident of alleged physical abuse "might have been an accident." As a result of the January 2005 accusations, a temporary order of protection was issued against the father that prevented contact between the father and the child for approximately one month. The mother accused the father of having physically abused the child in December 2005 after a visitation exchange, and made a report to Child Protective Services. Records from Maimonides Hospital, where the child was examined the day after the exchange, found the child to be physically normal. The mother's manipulative conduct demonstrated a purposeful placement of her self-interest above the interests of others. Evidence of false allegations of physical abuse which interfere with parental rights, is so inconsistent with the best interests of the child that it raises, by itself, a strong probability that the offending party is unfit to act as a custodial parent. By contrast, there was no evidence that any calls the father made to the police against the mother were baseless. Supreme Court failed to attribute adequate significance to the determination that the mother had made at least one false claim, though the record evidences more than one such claim, and improperly equated that evidence with markedly less egregious conduct of the father. The trial court erred in finding that the mother, rather than the father, would better foster the child's relationship with the noncustodial parent. While the parenting skills of both the mother and the father are subject to criticism, there was sufficient evidence from which to conclude that the father demonstrated an ability to foster post-divorce parent-child relationships, having done so with regard to his two older children from an earlier marriage. Moreover, a conclusion that the mother would more successfully foster a child/noncustodial parent relationship was insupportable, in light of her false allegations of physical abuse against the father. The child's best interests were fostered by awarding custody to the father. The father worked from a home office and would be more readily available than the mother to meet the child's daily and immediate needs. The judicial preference of keeping siblings together, where possible, in order to encourage close familial relationships, is firmly established. While there was clearly an age difference between the parties' child and his two half-siblings, the numerous benefits the child could derive from the development of a relationship with the older siblings should not have been summarily disregarded. Supreme Court providently exercised its discretion in granting the mother maintenance of $3,500 per month for five years. However, it erred in failing to include a provision that the award of maintenance shall terminate upon the death of either party or the mother's remarriage, whichever shall occur sooner.

 

A Credit Against Child Support for College Expenses Is Not Mandatory but Depends upon the Facts and Circumstances in the Particular Case, Taking into Account the Needs of the Custodial Parent to Maintain a Household and Provide Certain Necessaries

In Pistilli v Pistilli, --- N.Y.S.2d ----, 2008 WL 2713989 (N.Y.A.D. 4 Dept.) following the entry of a judgment that, inter alia, granted plaintiff a divorce, plaintiff moved to modify the judgment by "[d]istributing the actual and anticipated college education costs associated with the parties' children," specifically the parties' daughter, between the parties. Defendant cross-moved for an order directing that he pay 60% of the college education expenses of the parties' daughter and reducing his child support obligation accordingly. Defendant appealed from an order requiring him to pay 80% of the daughter's college expenses based on Supreme Court's determination that defendant "shall contribute to college costs 'in accordance with his percentage' " of the parties' combined parental income and denying his cross motion seeking a reduction in his child support obligation. Pursuant to an oral stipulation of the parties that was incorporated but not merged into the judgment of divorce, the parties "agreed to contribute to [their children's college expenses] as they are then financially able." The Appellate Division held that the court erred in failing to consider defendant's maintenance obligation in calculating the percentage of defendant's contribution to the daughter's college expenses. After subtracting from defendant's income the amount of taxable maintenance paid to plaintiff as indicated on the parties' respective 2005 tax returns, which were used by the court in determining the parties' respective incomes, it concluded that defendant's percentage of the combined parental income was 64% rather than 80%, and thus defendant's pro rata share of the daughter's college expenses was reduced from 80% to 64%. It rejected defendant’s contention that the court erred in determining that he was entitled to a credit against his child support obligation only in the amount of his pro rata share of the daughter's college meal plan. It held that a credit against child support for college expenses is not mandatory but depends upon the facts and circumstances in the particular case, taking into account the needs of the custodial parent to maintain a household and provide certain necessaries. Because plaintiff had to maintain a household for the daughter during the daughter's school breaks and weekend visits, it could not be said that defendant was entitled to a credit for the daughter's rooming expenses. Nevertheless, inasmuch as we it reduced defendant's pro rata share of the daughter's college expenses from 80% to 64%, defendant's child support credit based on the college meal plan had to reflect that reduction and it modified the order accordingly.

  

Proper to Grant Cruelty Divorce in Long Marriage Where Continuous Course of Misconduct. Error Not to Award Custodial Parent Exclusive Occupancy of Home.

In Stacey v Stacey, 52 A.D.3d 1219, 860 N.Y.S.2d 350 (4 Dept 2008) the Appellate Division affirmed a judgment that granted defendant wife a divorce on the ground of cruel and inhuman treatment. The Court held that defendant was required to establish that the parties suffered from more than strained, unpleasant relations and incompatibility and, in this marriage of long duration, a higher degree of proof was required to establish cruel and inhuman treatment because what could be viewed as substantial misconduct in a marriage of short duration might be only 'transient discord' in a marriage of many years. It noted however, the statement of the Court of Appeals that, "even in [a long-term] marriage 'substantial misconduct' might consist of one violent episode such as a severe beating" (Brady, 64 N.Y.2d at 345, 486 N.Y.S.2d 891, 476 N.E.2d 290). Defendant testified on direct examination concerning an incident that occurred approximately five months before the commencement of the action, during which plaintiff called defendant vulgar names and repeatedly struck her on the side and back of her head. The incident caused defendant to seek medical treatment, and she obtained an order of protection against plaintiff. Defendant also testified that plaintiff verbally abused her before she left for work concerning her appearance and the clothes that she was wearing. On cross-examination, defendant further testified that, throughout the course of the marriage she was hit or slapped by plaintiff "every time the dishes weren't done or the laundry wasn't done. According to defendant, plaintiff's conduct was continuous and not an " 'isolated act of mistreatment'. Thus, the court properly granted defendant a divorce on the ground of cruel and inhuman treatment. The Appellate Division agreed with plaintiff that the court erred in directing the immediate sale of the marital residence and in failing to award him exclusive use and occupancy of the marital residence until the parties' youngest child attains the age of 18, and modified the judgment accordingly. Plaintiff was awarded custody of the parties' children and thus, under the circumstances of this case, he was entitled to such exclusive use and occupancy. It stated: "Courts now express a preference for allowing a custodial parent to remain in the marital residence until the youngest child becomes 18 unless such parent can obtain comparable housing at a lower cost or is financially incapable of maintaining the marital residence, or either spouse is in immediate need of his or her share of the sale proceeds". Here, there was no evidence in the record that plaintiff, the custodial parent, could have obtained comparable, less expensive housing in the same area or that he was financially incapable of maintaining the residence, nor was there evidence that defendant was in immediate need of her share of the proceeds from the sale of the marital residence.

 

Fifth Circuit Holds Ne Exeat Rights, Even When Coupled with "Rights of Access," Do Not Constitute "Rights of Custody"

In Abbott v Abbott, --- F.3d ----, 2008 WL 4210541 (5th Cir. 2008) the Fifth Circuit found persuasive Croll's reasoning that the Hague Convention clearly distinguishes between "rights of custody" and "rights of access" and that ordering the return of a child in the absence of "rights of custody" in an effort to serve the overarching purposes of the Hague Convention would be an impermissible judicial amendment of the Convention. It held that ne exeat rights, even when coupled with "rights of access," do not constitute "rights of custody" within the meaning of the Hague Convention.

 

Seventh Circuit Holds That by Virtue of Doctrines of Patria Potestas and Ne Exeat, Venezuelan Father Had "Rights of Custody". Does Not Reach Issue of Whether Doctrine of Ne Exeat creates Custody Rights

In Vale v. Avila, 2008 U.S. App. Lexis 17068 (7 Cir. 2008) the Venezuelan divorce decree gave Avila physical custody of the children but gave both parents the right (and duty) of patria potestas. The divorce decree also gave Vale unlimited visitation rights, and the right of ne exeat, another civil law doctrine, whereby his consent was required before the children could leave the country. The Seventh Circuit held that by  virtue of the doctrine of patria potestas, Vale, the father, had rights relating to the care of the person of the child, and, by virtue both of that doctrine and by virtue of the doctrine of ne exeat, the right to determine that the child's place of residence would remain Venezuela rather than the United States. The Court pointed out that no more is necessary to establish that Vale had "rights of custody," which Avila infringed.

Second Circuit Reaffirms Croll Holding That Ne Exeat Right Does Not Create Rights of Custody and Holds That District Court May Enforce Rights of Access.

In Duran v Beaumont, --- F.3d ----, 2008 WL 2780656 (2nd Cir.(N.Y.) the Second Circuit pointed out that the Hague Convention distinguishes between rights of custody and rights of access. It defines rights of access as "the right to take a child for a limited period of time to a place other than the child's habitual residence." In interpreting the Hague Convention, the Court has held that violating a ne exeat right ( the right to determine whether the child will leave the country) is insufficient to qualify as a violation of custodial rights. It reaffirmed its holding in Croll v Croll, 229 F.3d at 138-140, that a ne exeat clause does not create rights of custody within the meaning of the Hague Convention. It also pointed out that although remedies exist in the event that a child is removed in breach of access rights, recourse for such removal does not include an order of return to the child's place of habitual residence. The court held that in such situations, district courts may fashion a remedy ordering the custodial parent who has removed the child to allow and financially provide for periodic visits by the non-custodial parent (disagreeing with Cantor v Cohen, 442 F.3d 196 (4th Cir. 2006)

 

Court of Appeals Holds That Commencement Date of Prior Discontinued Divorce Action May Not Serve as Valuation Date for Marital Property in Later Divorce Action.

In Mesholam v Mesholam, 6/27/2008 NYLJ 30, (col. 1) the Court of Appeals, in an Opinion by Judge Pigott, held that the commencement of a prior, discontinued divorce action may not serve as the valuation date for marital property for purposes of equitable distribution in a later divorce action. Courts must use the commencement date of the later, successful action as the earliest valuation date for marital property. However, the circumstances surrounding the commencement of the earlier action can and should be considered as a factor by the trial court, among other relevant factors, as it attempts to calibrate the ultimate equitable distribution of marital economic partnership property acquired after the start of such an action by either spouse.
The parties were married in 1969. The wife commenced an action for divorce in 1994. The husband answered, but did not counterclaim for divorce. Five years later the Supreme Court granted the wife's motion to discontinue the action. Almost immediately, the husband commenced this action for divorce. After finding that the husband was entitled to a divorce Supreme Court held that the husband's pension must be valued as of the commencement date of the present action, rather than the commencement date of the wife's 1994 action, relying on Domestic Relations Law §236(B)(4)(b). Supreme Court determined that the marital property, including the marital portion of the pension, should be divided equally between the parties. The Appellate Division held Supreme Court improvidently exercised its discretion in valuing the pension as of the commencement date of the present action. It concluded that the 'appropriate valuation date was the commencement date of the 1994 action' because there was 'no evidence that the parties reconciled and continued to receive the benefits of the marital relationship after the prior action was commenced' (25 AD3d 670, 671 [2006]).
The Court of Appeals modified the order of the Appellate Division and remitted the matter to Supreme Court for further proceedings. It pointed out that Domestic Relations Law 236(B)(1)(c) defines marital property as all property acquired 'during the marriage and before the execution of a separation agreement or the commencement of a matrimonial action.' Thus, in the absence of a separation agreement, the commencement date of a matrimonial action demarcates 'the termination point for the further accrual of marital property ' (citing Anglin v. Anglin, 80 NY2d 553, 556 [1992]). The Court held that the valuation date must be between 'the date of commencement of the action and the date of trial ' (Domestic Relations Law 236 [B][4][b]). In determining whether the commencement of a particular 'matrimonial action' terminates the accrual of marital property, it looked to 'the overall legislative intent of the Domestic Relations Law and the particular application of the equitable distribution regime. In Anglin, the Court held that the commencement of a separation action does not cut off the accrual of marital property because such an action does not, ipso facto, terminate the marital economic partnership. Rather, the economic partnership should be considered dissolved when a matrimonial action is commenced which seeks divorce, or the dissolution, annulment or declaration of the nullity of a marriage, i.e., an action in which equitable distribution is available. It observed that this rule provides internal consistency and compatibility and objective verification, as opposed to uneven, ephemeral, personal interpretations as to when economic marital partnerships end. For similar reasons, it concluded that the value of marital property generally should not be determined by the commencement of an action for divorce that does not ultimately culminate in divorce. Equitable distribution is available 'in an action wherein all or part of the relief granted is divorce. Where there is no divorce, there can be no equitable distribution. Consequently, permitting the commencement date of the prior, unsuccessful divorce action to govern the valuation date of marital property for the purposes of a later, successful action in which equitable distribution is available would be inconsistent with the statutory scheme. The Court found that, as Supreme Court concluded, the pension benefits were marital property to the extent that they were earned prior to the commencement of the present divorce action. As a result, the marital portion of the pension could not be valued at any time earlier than the commencement date.

 

Obligation to Provide for Future College Expenses Not Subject to Deviation Rules

In Cimons v Cimons, --- N.Y.S.2d ----, 2008 WL 2457243 (N.Y.A.D. 2 Dept.) the Second Department in an opinion by Justice Angiolillo, held that, under the circumstances presented here, the obligation to provide for the future college expenses of the children was not part of the parties' basic child support obligation and therefore was not subject to the CSSA requirement that any deviation from statutorily-mandated child support obligations must be recited and explained in a stipulation of settlement. Even though the parties violated the CSSA by failing to recite and explain in their stipulation why they deviated from CSSA standards in providing basic child support, and the basic child support provisions were properly vacated as a consequence, the provision concerning future college expenses survived the vacatur, and was enforceable.

The parties entered into a stipulation of settlement, which was incorporated but not merged in a judgment of separation. Subsequent to the entry of the judgment, the father moved to vacate the child support and related provisions of the stipulation, alleging that the stipulation failed to comply with the "opt-out/deviation" provisions of the CSSA contained in Domestic Relations Law 240(1-b)(h). The Supreme Court determined, in effect, that the parties' agreement deviated from the provisions of the CSSA with regard to the calculation of "basic child support." Since the parties failed to comply with the provisions of Domestic Relations Law 240(1-b)(h), those basic child support provisions were not enforceable, and the Supreme Court vacated those provisions of the parties' stipulation relating to their basic child support obligation for their three children, ultimately scheduling a hearing for a calculation of basic child support pursuant to the CSSA. However, Supreme Court denied the father's motion to vacate the separate provisions of the stipulation that related to the parties' agreement to provide for their children's future college expenses.

The Appellate Division affirmed. It noted that a parent has an obligation to provide support for his or her child's basic needs, an obligation which is addressed in Domestic Relations Law s 240(1- b)(c)(1), (2). Unlike that basic obligation, support for a child's college education is not mandatory. Absent a voluntary agreement, a parent might be required to provide support for his or her child's attendance at college, but the determination of that obligation is dependent upon the exercise of the court's discretion in accordance with Domestic Relations Law s 240(1- b)(c)(7).

Domestic Relations Law 240(1-b)(h) requires that any agreement or stipulation voluntarily entered into between the parties, and presented to the court for incorporation in an order or judgment, must include provisions: (1) stating that the parties have been advised of the provisions of the CSSA; (2) stating that the basic child support provisions of the CSSA would presumptively result in the determination of the correct amount of child support to be awarded; (3) stating what the amount of basic child support would have been if calculated pursuant to the CSSA, if the parties' stipulation or agreement deviates from the basic child support obligation; and (4) setting forth the parties' reason or reasons for deviating from the CSSA calculation, if they have chosen to deviate. The requirements of Domestic Relations Law s 240(1- b)(h) may not be waived by either party or by counsel.

The Appellate Division noted that in contrast to the add-ons for child care expenses and future reasonable health care expenses, which must be awarded and prorated in the same proportion or percentage as each parent's income bears to the combined parental income, the add-on for educational expenses is within the court's discretion, both as to whether an award of such expenses is to be made in the first instance, and the parties' share of any amount awarded. Domestic Relations Law 240(1-b)(c)(7).

Where the parties' stipulation or agreement fails to comply with the requirements of Domestic Relations Law s 240(1-b)(h), it is fundamental that the basic child support provisions of the agreement are invalid and cannot be enforced. That portion of the agreement must be set aside and the parties' basic child support obligation must be recalculated through the application of the CSSA. Nonetheless, the invalidity of the basic child support obligation, due to a deviation from the CSSA standards without full compliance with Domestic Relations Law 240(1-b)(h), does not necessarily require that the entire stipulation be vacated. That a portion of an agreement may be invalid and unenforceable does not necessarily preclude the enforcement of other portions of an agreement. (Ferro v. Bologna, 31 N.Y.2d 30).

The Court held that the determination as to which additional aspects, if any, of the parties' stipulation must be vacated along with the basic child support provision depends on the circumstances of the particular case and the nature of the obligations addressed in the other provisions of a stipulation. Some provisions may be so directly connected or intertwined with the basic child support obligation that they necessarily must be recalculated along with the basic support obligation. Unlike child care expenses and unreimbursed health care expenses, education expenses are not directly connected to the basic child support calculation. Initially, education expenses differ from these other expenses in that, in the absence of an agreement to pay education expenses, the determination as to whether or not such expenses will be paid is within the court's discretion (see Domestic Relations Law 240[1-b][c][7] ), while child care and unreimbursed health expenses are mandatory. Also, education expenses differ in that such expenses are not necessarily prorated in the same proportion or percentage as each parent's income bears to the combined parental income.

The Court held that the entirety of the stipulation should be considered in determining whether the parties' agreement evinces that trade-offs were made which involved the basic child support figure. In such a situation, expenses that are not directly connected to the CSSA calculation, or even to child support, may be so closely intertwined with the basic child support provision as to require vacatur.

This case fell within the ambit of cases that have clearly stated that the tuition expense aspect of a college education is distinct from basic child support. The parties' stipulation, insofar as it pertained to their support for their children's attendance at college, recited as follows: "The parties further acknowledge, each to the other, that it is their anticipation that each of their children attends college. And in this regard, the parties agree to contribute pro rata to income to the minimum of a SUNY education. That is State of New York education for a New York State resident for each child and shall contribute more than that minimum, if possible, based upon their respective financial circumstances at the time each child makes application to college. College expenses with respect to the parties' obligation, to pay for same pro rata to income is defined as including but not limited to tuition, room and board, mandatory books, supplies and fees, pre-college testing classes and actual testing, such as the SATs, scholastic aptitude tests and reasonable number of applications to colleges for purposes of the child or children reviewing campuses for purposes of making a final decision with respect to the selection of college."

The court held that to the extent that the commitment to meet future college expenses addressed room and board, the agreement did not deviate from the CSSA as it provided that the parties will contribute to such expenses pro rata to income. The stipulation also included extensive provisions as to how the parties are to deal with various custodial funds that had been earmarked for college education expenses, including a recital that such funds would be utilized in the first instance before triggering the parties' obligation to contribute to college expenses proportionally based on their income.

There was nothing in the record that would support a finding that the father agreed to pay a share of college expenses as a trade-off against some other expense. When the parties agreed to equitable distribution and traded off certain assets, the stipulation directly addressed those trade-offs. Thus, the wife received sole title to the marital residence in exchange for waiving any claim to the husband's pension, IRA, or deferred-compensation account. Similarly, the wife waived any claim to certain stock in exchange for the husband's waiver of any claim to a joint bank account. Additionally, the provisions of the parties' stipulation regarding college expenses were distinguishable from those provisions of the stipulation based upon the calculation of basic child support. In particular, the stipulation provided: "Mr. Cimons shall pay child support for the benefit of the children and to the age of 21 or 22, if in college." The father's agreement to support his children and contribute to their college education expenses beyond the age of 21 years inured primarily to the benefit of the three children. As it is the intent of the CSSA to protect the children, to the extent possible, from the economic consequences of their parents' divorce or separation, it would seem particularly unjust to allow the father, whose adjusted income, in 2005, after deduction of all mandatory deductions including his maintenance obligation, was reported as $130,000, to wield noncompliance with the CSSA as a sword to eviscerate his commitment to provide his children with support for their college education.

 

Court of Appeals Holds Family Court Lacked Subject Matter Jurisdiction to Entertain Wife's Application for Increased Spousal Maintenance Despite "De Novo" Provision of Separation Agreement

In
Matter of Johna M.S. v Russell E.S., --- N.Y.3d ----, 2008 WL 1860165 (N.Y.) Petitioner wife and respondent husband executed a written separation agreement in 2003. No divorce action was commenced. The agreement provided that the husband would pay the wife $100 per week in spousal maintenance and $250 per week in child support. The section of the agreement pertaining to maintenance stated: "while this agreement will resolve these issues for the present time, the Wife shall not be foreclosed from seeking additional maintenance in negotiation with the Husband, or failing such negotiation, then filing in a court of appropriate jurisdiction for a modification of the present provisions concerning the payment of maintenance. Any application by the Wife shall be treated as a 'de novo' application to the court, since it is not possible to set future maintenance at this time because it is impossible to forecast the Wife's needs or the Husband's income/earning capacity."
The wife commenced a Family Court Act article 4 proceeding seeking an upward modification of maintenance and child support. The Support Magistrate dismissed that portion of the wife's application seeking additional spousal maintenance for lack of jurisdiction. The court noted that no proof was offered that the wife was likely to become a public charge (see Family Court Act 463); thus, the parties were bound by the terms of the separation agreement on the issue of spousal maintenance. Family Court affirmed, as did the Appellate Division. The Court of Appeals affirmed. It held that Family Court is a court of limited jurisdiction that cannot exercise powers beyond those granted to it by statute. It generally has no subject matter jurisdiction to reform, set aside or modify the terms of a valid separation agreement. Nor can an agreement of the parties confer on Family Court the power to modify the terms of a separation agreement. A statutory exception to the rule prohibiting the modification of separation agreements, not applicable here, exists where a spouse "is likely to become in need of public assistance or care" (Family Court Act 463). Family Court lacked subject matter jurisdiction to entertain the wife's application for increased spousal maintenance. Although the parties' separation agreement purported to permit Family Court to treat any application by the wife as "de novo," such language cannot confer jurisdiction upon Family Court. The wife's petition to Family Court for increased maintenance expressly stated that it was "an application to the Court for an upward modification of spousal support," premised on the insufficiency of current maintenance due to a loss of certain Social Security benefits. In practical terms, the wife was not presenting a new, or "de novo," application for maintenance to Family Court. She was seeking increased maintenance from that provided under the separation agreement. Thus, because the wife was seeking a modification of a spousal maintenance award set forth in a separation agreement, Family Court was without jurisdiction to entertain the petition and grant the requested relief. Justice Smith dissented in an opinion


Second Department Holds Counsel Fees to Nonmonied Spouse Generally Warranted Where a Significant Disparity in Parties Financial Circumstances and Should Not Be Denied, or Deferred Absent Good Cause, Articulated in a Written Decision

In Prichep v Prichep, --- N.Y.S.2d ----, 2008 WL 1987254 (N.Y.A.D. 2 Dept.) the Second Department, in an opinion by Justice Prudenti, held that because of the importance of such awards to the fundamental fairness of the proceedings, an award of interim counsel fees to the nonmonied spouse will generally be warranted where there is a significant disparity in the financial circumstances of the parties and should not be denied, or deferred until after the trial, which functions as a denial, without good cause, articulated by the court in a written decision. It cited as examples of good cause, where the requested fees are unsubstantiated or clearly disproportionate to the amount of legal work required in the case. It based this conclusion on the fact that when an action for a divorce is commenced, it is often the case that most of the marital assets available for the payment of legal fees are possessed or controlled by one of the spouses, usually the husband. In order to ensure that the parties will have equal access to skilled legal representation, the Domestic Relations Law authorizes awards of interim counsel fees to the nonmonied spouse during the course of the litigation. The court pointed out that when a party to a divorce action requests an interim award of counsel fees, as opposed to a final award, a detailed inquiry is not warranted. The husband commenced the divorce action in 1998. In June 2005, the wife made a pretrial motion for interim counsel fees of $35,000. The wife's motion papers noted that, although the court previously had awarded her interim counsel fees of $20,000, she currently owed her attorneys $53,009. The wife pointed out that the husband was a "highly successful vascular surgeon," earning $420,100 per year, while she worked part-time as an early intervention therapist, earning $4,015 per year. In opposition to the wife's motion, the husband argued that the wife had "over-litigated" the case, creating and submitting voluminous and unnecessary papers, and thus generating excessive counsel fees. Supreme Court denied the wife's motion "without prejudice to renewal before the trial court to determine the financial circumstances of the parties, the nature and complexity of the case, which includes the valuation of a medical practice, the fees filed and legal services rendered and the expertise of the attorneys." The wife thereafter moved to renew her prior motion and for an additional award of interim counsel fees of $40,000. Her attorney submitted an affidavit asserting that the wife now owed his firm $159,000 in legal fees, as well as invoices and attorney time records documenting billings in that amount. In the alternative, the motion sought leave to withdraw as her counsel. Supreme Court denied the motion for fees but granted the law firm's request to the extent of relieving it as counsel for the wife. An award of interim counsel fees ensures that the nonmonied spouse will be able to litigate the action, and do so on equal footing with the monied spouse. Such an award "is appropriate 'to prevent the more affluent spouse from wearing down or financially punishing the opposition by recalcitrance, or by prolonging the litigation' "(citing Gober v. Gober, 282 A.D.2d 392, 393, quoting O'Shea v. O'Shea, 93 N.Y.2d at 193; see Charpie v. Charpie, 271 A.D.2d 169). If the playing field were not leveled by an award of interim counsel fees, "a wealthy husband could obtain the services of highly paid (and presumably seasoned and superior matrimonial counsel, while the indigent wife, essentially, would be relegated to counsel willing to take her case on a poverty basis".


Third Department Holds That Absent Stipulation No Pendente Lite Counsel Fee Award Without A Hearing

In Bush v Bush, 46 A.D.3d 1140, 848 N.Y.S.2d 721 (3d Dept, 2007) Defendant cross-moved for among other things, interim counsel fees in the amount of $85,172.81. Supreme Court awarded defendant interim counsel fees of $25,000. The Appellate Division reversed. It held that to justify an award of counsel fees, a sufficient evidentiary basis must exist for the court to evaluate the respective financial circumstances of the parties and value of the services rendered' Moreover, Supreme Court cannot award counsel fees based solely upon written submissions, unless so stipulated to by the parties. The proof submitted concerning the financial circumstances of the parties was limited to written submissions by respective counsel. As the record did not contain evidence of a stipulation agreeing thereto, the proof of the financial circumstances of the parties was inadequate for Supreme Court to properly assess the award of counsel fees. The Appellate Division reversed and remitted to Supreme Court for an evidentiary hearing (citing its 2003 decision in Yarinsky v.Yarinsky, 2 A.D.3d 1108 [3 Dept 2003] ).
 

 

Not Improper to Impute Income Based upon Father's Self-reported Financial Affidavit

In Barnett v Ruotolo, 851 N.Y.S.2d 519 (2d Dept. 2008) the Appellate Division held that in exercising the discretion to impute income to a party, a Support Magistrate is required to provide a clear record of the source from which the income is imputed and the reasons for such imputation. The father did not testify and chose to rely on the financial documentation he had submitted, which contained considerable discrepancies. The father's financial documentation indicated that his monthly income was only approximately one-third of his stated monthly expenses, and no evidence was submitted to show that these monthly expenses were not being paid in a timely manner. Accordingly, the Family Court did not improvidently exercise its discretion in imputing income based upon the father's self-reported financial affidavit for the purpose of calculating his child support obligation.

 

Proper to Impute Income by Averaging What Was Reported on Most Recent Individual Tax Returns

In re Y.W., v. T-T.J., ---- N.Y.S.2d ----, 2008 WL 222339 (N.Y.A.D. 1 Dept.) the Appellate Division reversed a child support order of $3,288 per month and remanded for recalculation of the basic child support obligation. It held that since each party claimed that the income as reflected on the other's tax return was not accurate, and the parties were unable to produce sufficient evidence to otherwise convince the support magistrate about their respective incomes, the magistrate properly decided to impute income to the parties by averaging what was reported on their most recent (2004 and 2005) individual tax returns. The magistrate used income figures net-of-deductions to calculate petitioner father's average income, but relied on respondent mother's gross income to calculate her average income, without taking into consideration her business deductions. The figure supposedly representing the average of respondent's 2004 and 2005 gross income was actually the gross income from her 2001 income tax return, adjusted upward by 2% to reflect additional cash receipts. Although respondent was unable to substantiate her business deductions at trial, the magistrate specifically found that respondent was able to prove that numerous entries on petitioner's tax returns were unaccounted for, and that his income was also possibly more than reflected on the tax returns. Given these circumstances, the magistrate should have compared gross income to gross income, or net income to net income, and not gross income to net income, in calculating child support. This was a high-income case. The magistrate applied a rate of 5% to the parties combined adjusted gross income over $80,000, without establishing the basis for applying such a rate, and without considering the appropriate level of support in light of the child's actual needs. Petitioner failed to offer any evidentiary support for his claim that his monthly expenses for the child were over $9,000 without add-ons. Without any supporting documentation, petitioner simply allocated 50% of his monthly expenses to the child, and the magistrate erroneously accepted his figures. It held that on remand, the court should consider the actual needs of the child, and rather than using an arbitrary percentage, should consider whether a cap on combined income over $80,000 subject to child support is warranted and apply the statutory percentage of 17% to that capped amount.

 

Error for Referree to Base Decision on Parties Unsworn Statements During Settlement Negotiations.

In Passalacqua v Passalacqua, --- N.Y.S.2d ----, 2008 WL 1838011 (N.Y.A.D. 4 Dept.) the Appellate Division held that, apart from those parts of the judgment granting the parties mutual divorces, the remainder of the judgment had no evidentiary basis in the record. The matter was referred to a Matrimonial Referee, who attempted to negotiate a settlement. No testimony was presented by either party. The Matrimonial Referee was unable to negotiate a settlement, and he then based his determination of the issues upon the unsworn statements of the parties during the settlement negotiations, which he deemed to be testimony. Although no exhibits were introduced by either party, the Matrimonial Referee relied upon the parties' descriptions of several prior orders in determining the issues before him. The Appellate Division was unable to review the propriety of the judgment with respect to the issues before the Matrimonial Referee inasmuch as the record was confusing and incomplete, and the 'contentions of the parties differed very sharply. It was unclear whether the Matrimonial Referee relied upon documents not admitted in evidence and it noted the well-established principle that, with exceptions not relevant here, unsworn testimony is inadmissible in a civil case . It concluded that the errors of the Matrimonial Referee rendered the matter inherently flawed and remitted to Supreme Court for a new hearing on all issues with the exception of the mutual divorces granted to the parties.

 

Error to Impose Cost-of-living Adjustment of Basic Child Support. Pendente Lite Support Can Not Be Paid out of Marital Property.

In Azizo v Azizo, --- N.Y.S.2d ----, 2008 WL 1946665 (N.Y.A.D. 1 Dept.) Supreme Court directed, inter alia, that defendant pay basic child support of $4,168 per month (with an annual cost of living adjustment) and 100% of reasonable add-on expenses until emancipation, plus spousal maintenance of $6,125 per month for 84 months (subject to certain limitations), awarded 70% of marital assets to plaintiff, and found that defendant wastefully dissipated $779,000 of marital assets, thus entitling plaintiff to a credit of 70% therefor. The Appellate Division modified to reduce basic child support to $2,834.39 a month once the parties' older child is emancipated, deleted the cost-of-living adjustment to basic child support and modified the distribution of marital assets to 55% for plaintiff and 45% for defendant to be used in adjusting all payments and calculating all credits. It also affirmed an order which awarded plaintiff attorneys' fees of $664,538 and expert fees of $57,142. It held that the trial court erred when it averaged defendant's income for the four years preceding commencement of the divorce action. However, it did not accept defendant's claim that his income was only $63,800 per year and imputed income to him as follows: in fiscal year 2001 (the most recent undistorted year), his income represented 20.7% of the gross revenue of Azizo Imports; in fiscal year 2005, the gross revenue of the business was $1.25 million; 20.7% of $1.25 million amounts to $258,750 per year. Given that defendant's income did decline, he was paying the children's private school tuition and medical costs, all carrying costs on the marital residence, and premiums for life insurance policies on which plaintiff was the beneficiary, some of the expenses on plaintiff's net worth statement (i.e., the statement underlying the pendente lite order) turned out to be exaggerated, and plaintiff's pendente lite award was actually greater than her final award after taking into account the carrying costs of the marital residence, the temporary monthly awards of $4,134 for child support and $5,000 for spousal maintenance were excessive. The Appellate Division held that more reasonable monthly figures would be $1,666.67 for pendente lite child support (25% of $80,000), and $2,500 for pendente lite maintenance. Since defendant paid $9,134 per month for 46 months but should have paid only $4,166.67 per month, he overpaid by $228,497.18. Accordingly, since the pendente lite support was paid out of marital assets, it held that defendant should receive a credit of 45% of his overpayment of $228,497.18, amounting to $102,823.73. Given that plaintiff had only two years of college education and did not work outside the home for most of the parties' marriage, and given their pre-divorce standard of living, the trial court properly awarded plaintiff $6,125 per month in maintenance. In light of the large financial disparity between the parties and the family's preseparation standard of living, the trial court properly went above the $80,000 Child Support Standards Act cap. The Appellate Division held that the trial court should have directed the payment to be reduced to $2,834.39 per month (17%) when the older child becomes emancipated. It also held that the court should not have imposed a cost-of-living adjustment of basic child support on the parties absent their agreement. The Appellate Division held that Defendant's claims that the judgment varied from the court's decision in certain respects were not properly raised on appeal; instead, he should have moved below to correct the judgment. Since defendant was the only wage earner at the time of the judgment, he was properly ordered to pay 100% of add-on expenses. Defendant was guilty of some economic fault. However, his fault was less than in Maharam v. Maharam (245 A.D.2d 94 [1997] ), where the wife was awarded 65% of marital assets, and Davis v. Davis (175 A.D.2d 45 [1991] ), where the wife was awarded 60% of the marital estate. The award of 70% to plaintiff was excessive, and the Appellate Division reduced it to 55%. Since pendente lite payments should not be made from marital property the trial court properly required defendant to reimburse the marital estate for marital assets he liquidated in order to comply with the pendente lite order. In light of the economic disparity between the parties and defendant's conduct during the action, the trial court providently exercised its discretion in awarding plaintiff counsel and expert fees.

 

 

Where Court Never Indicated it Was Imputing Income to Plaintiff it Was Required to Consider Plaintiff's Latest Income Tax Return in Determining the Child-support Award, Rather than Income-averaging His Reported Income.

In Healy v Healy, --- N.Y.S.2d ----, 2008 WL 2130379 (N.Y.A.D. 1 Dept.) the Appellate Division reversed on the law an order which denied plaintiff husband's motion for a downward modification of his spousal maintenance and child support awards. Following a trial in August of 2005, judgment was entered in February 2007, awarding defendant wife, among other things, a divorce on her counterclaim, custody of the couple's five children, $2,750 in spousal maintenance per month and $2,631 in child support per month. Plaintiff was represented by counsel at trial, and he promptly moved pro se for a downward modification after entry of judgment. At trial, his 2005 income tax return was admitted into evidence, indicating a substantial decrease in earnings. The court never indicated it was imputing income to plaintiff based on an attempt to avoid obligations or hide income. Accordingly, it was required to consider plaintiff's latest income tax return in determining the child-support award, rather than income-averaging his reported income from 2001 to 2004. Plaintiff's most recent tax return should also have been considered in determining the appropriate award for spousal maintenance.

 

Husband Deemed Legal Parent of Child Born to Wife Conceived as Result of AID Where Consent Not Obtained in Writing

In Laura WW v Peter WW, --- N.Y.S.2d ----, 2008 WL 991130 (N.Y.A.D. 3 Dept.) the Third Department held that a husband can be deemed the legal parent of a child born to his wife, where the child was conceived as a result of artificial insemination by donor during the marriage, but where the husband's consent to the AID was not obtained in writing. Plaintiff wife became pregnant again, as a result of AID, with a third child. A few months into the wife's pregnancy, the parties separated pursuant to an agreement which provided, among other things, that the husband would not be financially responsible for the child. In her subsequent complaint for divorce, the wife alleged that the child was born to the marriage. The parties then entered a settlement agreement which reaffirmed the terms of the separation agreement and calculated the husband's support obligation based on two children. Thereafter, Supreme Court found that the provision in the separation agreement absolving the husband of his support obligation for the child was void as against public policy. Following a hearing on the issue of paternity, Supreme Court held that the husband was the child's legal father and modified the parties' stipulation by increasing the husband's child support obligation based upon three children, instead of two. The Appellate Division affirmed. It agreed with Supreme Court that the provision of the settlement agreement absolving the husband of any support obligation with respect to the child was unenforceable. The parties' agreement, which preceded any determination of legal paternity, to leave the child without the husband's support could not stand (Matter of Gravlin v. Ruppert, 98 N.Y.2d 1, 5 [2002]; see Harriman v. Harriman, 227 A.D.2d 839, 841 [1996] ). The Court rejected the husband's attempt to invoke noncompliance with Domestic Relations Law 73 as a bar to a finding that he was, legally, the child's father. Consistent with our state's strong presumption of legitimacy, as well as the compelling public policy of protecting children conceived via AID, the Court followed the lead of other jurisdictions that impose a rebuttable presumption of consent by the husband of a woman who conceives by AID, shifting the burden to the husband to rebut the presumption by clear and convincing evidence. It was not disputed that the husband was fully aware that his wife was utilizing AID to get pregnant. He proffered no evidence that he took any steps before the AID was performed to demonstrate that he was not willing to be the child's father. Under these circumstances, the court found that that the husband failed to rebut the presumption that he consented to bringing a third child into the marriage through AID. The evidence supported Supreme Court's conclusion that the husband consented to his wife's decision to create the child and that he was the child's legal father. Pursuing an alternative avenue, the Court reached the same result, finding that the facts also warranted application of the doctrine of equitable estoppel to preclude the husband from "seeking to disclaim paternity of the parties' child, whose best interest is paramount".



Error to Decide Custody Without Forensic Report Where Conflicting Testimony Regarding Parties Conduct, and Evidence Suggesting Children Exhibiting Behavioral Problems

In Ekstra v Ekstra, --- N.Y.S.2d ----, 2008 WL 669895 (N.Y.A.D. 2 Dept.) Supreme Court appointed psychologist Lobel as a neutral forensic expert to conduct evaluations and submit a written forensic report on the custody issue. The appointment order provided that "[t]he neutral forensic evaluator's final report shall be admitted as evidence-in-chief without the necessity for independent foundation testimony or evidence, pursuant to 22 NYCRR 202.16(g)." The order further provided that "[a]ny party who wishes to cross-examine the neutral [forensic] evaluator, as permitted by the Uniform Rules, shall bear the cost of the neutral [forensic] evaluator's services in preparing such testimony, travel and testifying unless the Court directs otherwise." After Dr. Lobel's report was submitted, the father's counsel expressed an intention to cross-examine him and asked the court whether the father would be required to bear the costs of his appearance. The court responded that the father would not be required to bear that expense, but made no other provision for payment. As a consequence of not receiving his fee, Lobel did not appear, and the court granted the father's application to preclude the forensic report. Relying largely on its evaluation of the credibility of the witnesses, the court awarded sole custody of the parties' two children to the father. The Appellate Division reversed. It held that the in light of the sharply conflicting testimony regarding the conduct of the parties, and evidence suggesting that the children were exhibiting behavioral problems, the court should not have rendered a custody determination without first receiving the report of the neutral forensic expert it had appointed. Moreover, inasmuch as the father had the right to cross-examine the expert (see 22 NYCRR 202.16[g][2] ), and the expert could not have been compelled to testify without appropriate compensation the court should have made provision for payment to Lobel as it indicated that it would in the order appointing him. It reversed and remitted the matter to the Supreme Court, to reopen the custody hearing, at which time Lobel's report should be received in evidence and, should either party wish to cross-examine him, the court should make provision for the payment of his fee and expenses in accordance with the order appointing him.



Father Can Not Avoid Obligation to Pay College Expenses by Ignoring Written Communications

In Heinlein v Kuzemka, --- N.Y.S.2d ----, 2008 WL 660010 (N.Y.A.D. 3 Dept.) the parties agreed to contribute to the children's college expenses, provided that their then-financial circumstances permitted them to do so and that both parents "approve of the educational institution, course of study and living arrangements." The father sought relief from this obligation, asserting that since the mother did not consult him regarding his son's attendance at RPI, he did not approve of that school or any of the child's college-related expenses. The Appellate Division found that his protests were unavailing since, while aware of the child's aspirations to attend RPI, he failed to make any inquiries of the mother and consistently declined to accept registered mail sent by her. Moreover, once the father became aware that his son was attending RPI, he took no action to object to the choice of school or apply to be relieved of his obligations, thus signifying his acquiescence and implicit approval of the decision. The Appellate Division held that the father could not avoid his contractual obligations to pay his son's college expenses, which were imposed by separation agreement that was incorporated, but not merged, into divorce degree, by ignoring the mother's written communications and remaining silent in the face of his admitted knowledge that his son was attending college.



In Absence of Other Evidence Value of Vehicle in Net Worth Statement Should Have be Adopted by Court

In
Winter v Winter, --- N.Y.S.2d ----, 2008 WL 1722288 (N.Y.A.D. 1 Dept.) Supreme Court set spousal maintenance, child support and defendant husband's share of add-on child expenses, allocated marital property and assets subject to certain credits including accounting for wasteful dissipation, denied defendant credit for pendente lite mortgage payments on the marital residence, and ordered defendant to pay 40% of plaintiff's legal fees. The Appellate Division modified, to reduce defendant's obligation with respect to plaintiff's legal fees to 30%, and to reduce the value assigned to the parties' Jeep Cherokee from $15,000 to $11,000. The Appellate Division found that in determining the value of the Jeep Cherokee, the court used the vehicle's 2004 purchase price of $15,000. In her September 30, 2005 net worth statement, plaintiff valued that asset at $11,000. In the absence of any other evidence as to the vehicle's worth, plaintiff's valuation should have been adopted by the court.

 

 

Wilful Violation of Support Order Can Be Established Without Testimony by a Formal Judicial Admission

In
Matter of Columbia County Support Collection Unit v Interdonato, --- N.Y.S.2d ----, 2008 WL 1969647 (N.Y.A.D. 3 Dept.) the Appellate Division rejected Respondents argument on appeal that Family Court erred in finding a willful violation of the support orders and ordering that he be committed based on unsworn testimony. It held that it is well settled that when there is no admission by a respondent, a determination of a willful violation of a support order must be predicated upon proof adduced at a hearing. A formal judicial admission by a respondent may, however, obviate the need for a hearing inasmuch as the respondent, by his or her admission, waives the production of evidence by the opposing party with regard to the facts admitted and the respondent's admission is deemed conclusive with regard to those facts. Here, respondent's unequivocal admission before the Support Magistrate in open court to the facts giving rise to petitioner's claim of respondent's violation of Family Court's orders, that he failed to make the required child support payments, was made with sufficient formality and conclusiveness to be deemed a formal judicial admission even in the absence of an oath. Furthermore, proof of a failure to make required support payments is prima facie evidence of a willful violation. Accordingly, Family Court's order was not based upon unsworn testimony, but was properly made following respondent's admission and, as such, it was affirmed.
 

Second Department Removes Law Guardian Failure to Comply With Rules of Chief Judge

In Cervera v Bressler, --- N.Y.S.2d ----, 2008 WL 1748331 (N.Y.A.D. 2 Dept.) the parties' entered into a stipulation, later so-ordered by the court, in which they agreed to joint custody, with primary physical custody with the mother, visitation to the father on alternate weekends and one weekday per week, and the removal of certain restrictions on visitation that had been imposed temporarily. In July 2005, the attorney for the child moved by order to show cause for supervised visitation, based on various allegations by the mother, including one allegation of sexual molestation. The sexual molestation allegation was subsequently determined to be unfounded. Although a hearing on the motion was scheduled at least once, it never took place, and visitation by the father remained supervised since July 28, 2005. The Appellate Division held that supervised visitation was appropriately required only where it is established that unsupervised visitation would be detrimental to the child and because no hearing was ever held on the order to show cause visitation remained supervised, and telephone contact between father and daughter was monitored, for about 2 1/2 years, based solely on the hearsay allegations of the mother. These consisted of the allegations of molestation, which were determined by OCFS to be unfounded, and stories of various incidents, the details of which were disputed by the father and, were insufficient to show that unsupervised visitation would be detrimental to the child's well-being. Under these circumstances, it was unacceptable to the Second Department that the hearing had not been held, although ordered more than 2 1/2 years earlier. This arrangement resulted in the violation of the father's right to reasonable access and visitation.

It also held that the court should not have required the father to pay the cost of supervising his visitation without determining the economic realities, including his ability to pay and the actual cost of each visit. Finally, it held that the court improvidently exercised its discretion in denying the father's motion to remove Joshua D. Siegel as the attorney for the child. It referred to the new rules that had been recently promulgated by the Chief Judge and stated that an attorney for the child should not have a particular position or decision in mind at the outset of the case before the gathering of evidence. On the other hand, attorneys for children are not neutral automatons. After an appropriate inquiry, it is entirely appropriate, indeed expected, that an attorney for the child form an opinion about what action, if any, would be in a child's best interest. An attorney for the child is not an investigative arm of the court. While attorneys for the children, as advocates, may make their positions known to the court orally or in writing (by way of, among other methods, briefs or summations), presenting reports containing facts which are not part of the record or making submissions directly to the court ex parte are inappropriate practices. Here, in the order to show cause , and the affirmation in support, as well as in every affirmation submitted thereafter, the attorney for the child included facts which were not part of the record, but which constituted hearsay gleaned from the mother. This behavior on the part of the attorney for the child, as well as his repeated ad hominum attacks on the father's character, was both unprofessional and improper, as it amounted to the attorney for the child acting as a witness against the father, in violation of the Rules of the Chief Judge (see 22 NYCRR 7.2[b] ).

Law Guardian Rebuked for Failure to Follow Rules of Chief Judge and Wishes of Child

In Matter of Delaney v. Galeano,--- N.Y.S.2d ----, 2008 WL 1823048 (N.Y.A.D. 2 Dept.) the attorney for the child appealed from an order of the Family Court, which, after a hearing, denied his motion to hold the respondent mother in contempt. Upon receipt of a copy of a letter dated June 15, 2007, from the 14-year-old child to the effect that he did not want the appeal to proceed, the Appellate Division issued an order to show cause directing the parties or their attorneys to show cause why an order should not be made dismissing the appeal in the above-entitled proceeding as withdrawn. After argument of the appeal the motion was granted and the appeal was dismissed as withdrawn. The Appellate Division held that where "the child is capable of knowing, voluntary and considered judgment, the attorney for the child should be directed by the wishes of the child" (22 NYCRR 7.2[d][2]). Here, the child on numerous occasions has expressed concern that his attorney was not representing his wishes. Additionally, he requested that the appeal be withdrawn, prompting the Court to require the parties or their attorneys to show cause why the appeal should not be dismissed as withdrawn. In response to that order to show cause, the attorney for the child failed to demonstrate any basis upon which the child's preference may properly be disregarded (see 22 NYCRR 7.2[d][3] ).

 

Wife’s Failure to Disclose Bank Statements and Transfers of Real Property Justified an Adverse Inference Against Her

In Gering v Tavano, --- N.Y.S.2d ----, 2008 WL 879674 (N.Y.A.D. 1 Dept.) the Appellate Division held that the verdict of cruel and inhuman treatment was supported by legally sufficient evidence, which included evidence of defendant's denigrating comments about plaintiff's religious background, accusations of infidelity, and interference with plaintiff's relationship with the children and evidence of plaintiff's anxiety, depression, headaches and stomach aches resulting therefrom . Plaintiff showed a reasonable excuse for not filing the complaint alleging cruel and inhuman treatment until approximately two years after the commencement of the divorce action. The parties had stipulated that the issue of fault was resolved and that plaintiff would "take the divorce" on the ground of constructive abandonment. However, defendant objected to that ground two years later, after the inquest. Defendant was not prejudiced by the delay, since plaintiff's summons with notice indicated that he sought a divorce on the grounds of both constructive abandonment and cruel and inhuman treatment. Plaintiff was not required to submit an affidavit of merit. The court properly based its imputation of income to plaintiff on his admission that he took money from his business for personal expenses and failed to report it on his income tax returns. With respect to defendant's financial condition, her failure to disclose her bank statements and various transfers of real property among herself, her family members and third parties justified an adverse inference against her (see 22 NYCRR 202.16[k][5][I]; Wildenstein v. Wildenstein, 251 A.D.2d 189 [1998] ). The maintenance award of $2,000 a month was properly based upon the court's finding of defendant's failure to comply with discovery and disclose real estate transactions and bank statements and the family's pre-divorce standard of living. However, the one-year duration of the award was inadequate and it was increased to three years. The court properly articulated its reasons for setting the child support obligation at 25% of $150,000. Given the evidence of defendant's own substantial assets, the court properly required her to contribute 13% during the first year and 14% thereafter The award to defendant of a 15% interest in plaintiff's business was proper, given her failure to contribute to the business, lack of cooperation with respect to discovery of her own assets, and receipt of temporary maintenance.

Proper To Hold Defendant Responsible for the Plaintiff's Counsel Fees in Same Amount As He Paid His Counsel

In Ciampa v Ciampa, --- N.Y.S.2d ----, 2008 WL 193292 (N.Y.A.D. 2 Dept.), the Appellate Division held that Supreme Court did not err in awarding the plaintiff counsel fees up to the amount defendant paid for his own counsel of $201,437.80, as well as expert fees of $50,00. This matrimonial action required the expenditure of significant counsel fees to deal with the myriad of legal issues presented, as well as substantial expert fees in order to evaluate the parties' multimillion-dollar business assets and residential and commercial real estate. The defendant's expenditure of $201,437.80 for his counsel fees paled in comparison to the plaintiff's expenditure of more than $484,142 for her counsel and experts, the plaintiff having utilized at least five law firms during the course of this matrimonial proceeding. Given, inter alia, the delay attributable to the plaintiff, the Supreme Court properly exercised its discretion.

Error to Admit into Evidence Determination of Social Security Administration on Issue of Wife’s Disability

In Grasso v Grasso, --- N.Y.S.2d ----, 2008 WL 193262 (N.Y.A.D. 2 Dept.) the Appellate Division found that that while the husband correctly contended that the court improperly admitted into evidence and relied upon a determination of the Social Security Administration as to the wife's disability, there was other sufficient admissible evidence which supported the finding that the wife was totally disabled.

Proper to Enjoin Defendant from Mailing Any Nonfinancial Correspondence to the Plaintiff

In Meccariello v Meccariello, 847 N.Y.S.2d 618 (2d Dept., 2007) Supreme Court permanently enjoined the wife from mailing any nonfinancial correspondence to the plaintiff. The Appellate Division held that Supreme Court was correct in permanently enjoined her from mailing any nonfinancial correspondence to the plaintiff, since the plaintiff demonstrated that he would suffer irreparable harm absent the injunction (citing Icy Splash Food & Beverage, Inc. v. Henckel, 14 A.D.3d 595, 596, 789 N.Y.S.2d 505; Kane v. Walsh, 295 N.Y. 198, 205-206, 66 N.E.2d 53).

Eleventh Circuit Rejects Rule Established By Sixth Circuit in Grave Risk of Harm Hague Cases

In Baran v Beaty, --- F.3d ----, 2008 WL 1991092 (11th Cir. (Ala.)) the Eleventh Circuit held that once a respondent has shown a child is at grave risk of harm, the burden shifts to the petitioner to provide evidence that specific undertakings will alleviate the identified risk. (citing Danaipour v. McLarey, 286 F.3d 1, 15 (1st Cir.2002) and Feder v. Evans-Feder, 63 F.3d 217, 226 (3d Cir.1995). When the petitioner makes such a showing, the district court must factor the proposed undertakings into its discretionary decision to grant or deny return. (Click here for extended discussion)

Family Court Lacks Jurisdiction to Enforce Order Incorporating Stipulation Provision for Child Dependency Exemption

In Matter of John M.S. v Bonnie L.R., --- N.Y.S.2d ----, 2008 WL 684447 (N.Y.A.D. 4 Dept.) the Respondent mother appealed from an order denying her objections to an order enforcing that part of a prior support order allocating the income tax dependency exemption for the parties' child to petitioner father pursuant to the parties' stipulation. The Appellate Division reversed . It held that Family Court lacked subject matter jurisdiction to enforce that part of the support order. Family Court is a court of limited jurisdiction, and] it cannot exercise powers beyond those granted to it by statute. With respect to the enforcement of support orders, the summary enforcement procedures of Family Court Act article 4 apply only to payments that in fact constitute 'support' or 'maintenance’. The father's entitlement to claim the child as a dependent for income tax purposes was not an element of support set forth in Family Court Act article 4, and thus the court lacked jurisdiction to enforce that part of the support order. The father had to seek enforcement of the parties' stipulation to allow the father to claim the child as his dependent for income tax purposes by way of a plenary action in Supreme Court.

Marital Property Cannot Be Shielded from Equitable Distribution by Investing it in Educational Trust

In Pea v Alves, --- N.Y.S.2d ----, 2008 WL 927951 (N.Y.A.D. 1 Dept) the Appellate Division held that the trial court correctly found the severance pay plaintiff received after commencement of the action to be a form of deferred compensation earned during the marriage, not, as plaintiff argued, compensation for future lost earnings, and thus a distributable marital asset. The court also properly rejected plaintiff's claim that the severance pay should, in effect, be exempt from distribution since she had already invested it in an educational trust for the parties' three children. Marital property cannot be shielded from equitable distribution in this way.

No Basis to Shield Wife from Economic Consequences of Shared Decision to Renovate Property. Spouses Contribution to Separate Assets and Liabilities of Former Spouse May Be Recouped in Equitable Distribution.

In Johnson v Chapin, --- N.Y.S.2d ----, 2008 WL 664929 (N.Y.A.D. 1 Dept.) during the marriage the parties renovated a house that was the separate property of the husband with money’s earned during the marriage. It appreciated during the marriage "due in part" to the direct and indirect efforts of both spouses, including the wife's assistance. The appreciated value of the property was less than its value at the time of the marriage plus the cost of the renovations and improvements. The Appellate Division held that the couple shared the risk that the property's appreciation would not equal their investment, and there was no basis in law or equity to shield the wife from the economic consequences of a shared decision to renovate the property. It also held that a spouses contribution to the separate assets and liabilities of his or her former spouse may be recouped in an award of equitable distribution. Marital funds should not be used to pay off separate liabilities' and, whenever that occurs, the inequity may be remedied by permitting the injured spouse to recoup his or her equitable share of the marital funds so used . The trial court determined that because the wife had not worked outside the home for nine years, she could not re-establish her legal career. It also concluded that it would take at least six years for her to develop her career in photography. The court awarded the wife durational maintenance of $6,000 per month for six years. The Appellate Division held that the durational maintenance award was not an abuse of discretion. The wife was 51 years old at the time of the commencement of this action. She had been out of the work force for nine years, during which time she had primary responsibility for raising the parties' child. As such, it was both fair and realistic for the court to have concluded that since it would take at least six years for the wife to develop a career in photography, a six-year maintenance award of $6,000 a month would provide her with appropriate assistance in reaching her vocational goals and allowing her to become self-sufficient. The trial court noted that the wife and her son "have suffered day to day crises resulting from the [husband's] harassment of them" with respect to every aspect of this protracted litigation. It thus awarded the wife $800,000 for the wife's counsel fees, and $85,000 for her expert fees. The Appellate Division held that the court's award was appropriate. The record, including his imputed future earnings, showed that he was in a superior financial position. He engaged in a pattern of obstructionist conduct which unnecessarily delayed and increased the legal fees incurred in the litigation. Given that the wife was required to hire an expert to counter the husband's facially inaccurate valuation of the appreciation of the Claverack property, the court properly granted the wife an award for her expert's fees . The Appellate Division held that equity required that the husband be awarded a distributive credit for $548,460, the amount that his pendente lite support payments exceeded what he would have been required to pay consistent with the final maintenance award. It also required that the husband be credited $484,370.50, 50% of the $968,741 in mortgage and maintenance payments made for the marital residence during the pendency of the divorce action.

For Appreciation of Separate Property to Be Marital Must Demonstrate Manner in Which Contributions Resulted in Increase

In Embury v Embury, --- N.Y.S.2d ----, 2008 WL 809026 (N.Y.A.D. 2 Dept.) the Appellate Division held that Supreme Court properly determined that certain real property which was gifted to the plaintiff by her mother during the marriage, was the plaintiff's separate property. Property acquired during the marriage is presumed to be marital property and the party seeking to overcome such presumption has the burden of proving that the property in dispute is separate property. The plaintiff sustained that burden with evidence that she and her mother purchased the property in November 2005, with her mother paying the down payment and all the closing costs, and the mother subsequently gifting to her the mother's interest in the home. Moreover, in order for appreciation in the value of separate property to be deemed marital property subject to equitable distribution the nontitled spouse must demonstrate the manner in which his contributions resulted in the increase in value and the amount of the increase which was attributable to his efforts. The defendant did not sustain his burden, as he failed to set forth proof that the property actually increased in value and, he did not demonstrate the manner in which his contributions resulted in any alleged appreciation. The Supreme Court erred in determining the defendant's child support obligation. While a court may depart from a party's reported income and impute income based on the party's past income or earning potential, such determination must be grounded in law and fact. Here, the court failed to properly consider that a contractual agreement under which the defendant was paid approximately $2,500 per month, or approximately $30,000 annually, had ended in 2003, and that the defendant's income, therefore, was reduced to that extent. The Appellate Division recalculated the defendant's child support obligations based on a total annual income of $60,000, since his federal tax return for his incorporated business, and his claimed monthly expenses, including his pendente lite support obligations, generally approximated that level of income. Since the plaintiff's annual income was $30,000, the parties' combined parental income amounted to $90,000, with the defendant's proportional share thereof at 67%, his child support obligation was $1,557.75 monthly, and he was obligated to pay a 67% pro rata share of child care expenses and the children's unreimbursed health care costs.

Stocks Purchased During Marriage Jointly Titled in Spouse and Son Are Presumptively Marital Property

In Lee v Lee, 48 A.D.3d 377, 853 N.Y.S.2d 34 (1st Dept. 2008) the Appellate Division found that stocks and an insured money mart account, and stock shares resulting from a demutualization, that were jointly titled in defendant and his son were purchased or obtained during the marriage, and were presumptively marital property despite the form of the title. It was defendant's burden to rebut this presumption and he failed to do so. Since he did not, the Appellate Division deemed half the shares and money to be separate property and half marital property.

 

Parent Coordinator Rejected By Supreme Court

In E.C., v F.C. (Sup.Ct. NY Co, 9-28-07, Emily Jane Goodman, J ) a custody case, Ms. C. sought the right to make parental decisions when there was an issue in dispute that cannot be reasonably resolved in a reasonable amount of time, after consultation with Mr. C., with each parent having had an opportunity to be heard by the other. The Father took the position that if the parents cannot agree, then a third party ‘"parent coordinator" be retained. In a well reasoned opinion the court held that in addition to the time commitment, delay and expense of having a parenting coordinator where there are two devoted parents, it would be counterproductive to order that course, rather than one parent recognizing the appropriateness and authority of the other. (Click here to read the full opinion)

AICPA Releases Standards for Valuation of a Business, Business Ownership Interest, Security, or Intangible Asset

The American Institute of Certified Public Accountants (AICPA) has released Statement on Standards for Valuation Services No. 1 (SSVS No. 1) “Valuation of a Business, Business Ownership Interest, Security, or Intangible Asset,”  which is intended to provide AICPA members guidelines for developing estimates of value and reporting on the results. It applies to AICPA members who perform an engagement that estimates the value of a business, business interest, security or intangible asset for numerous purposes, including sales transactions, financing, taxation, financial reporting, mergers and acquisitions, management and financial planning and litigation. It is effective for engagements accepted on or after January 1, 2008. It pecifies two types of engagements: valuation engagements and calculation engagements. It applies to an engagement or any part of an engagement that estimates value when the member (1) applies valuation approaches and methods and (2) uses professional judgment in that application. It applies to all AICPA members who perform valuation services for various purposes (such as transactions, financings, taxation, financial accounting, bankruptcy, management and financial planning and litigation) as well as for various disciplines in the profession (including consulting, litigation services, personal financial planning, tax and accounting).  The Standard contains several exceptions when the requirements do not apply. The Standard provides that all AICPA members, regardless of discipline, should follow SSVS No. 1 when they perform an engagement or any part of an engagement that estimates a value resulting in an expression of either a conclusion of value or a calculated value, unless a specified exception applies to them. Visit www.aicpa.org/bvstandard  to review the Standard.    

 

Eleventh Circuit Defines "Retention" Under Hague Convention on International  Child Abduction

Pielage v McConnell, --- F.3d ----, 2008 WL 399431 (11th Cir. 2008) [Click here for expanded discussion]

Constructive Abandonment Found Where Unreasonable Condition Imposed by Wife

In Dunne v Dunne, 47 A.D.3d 1056, 850 N.Y.S.2d 659 (3d Dept. 2008) the parties were married in 1976. Around 1996 or 1997, plaintiff was diagnosed with a general anxiety disorder. He was prescribed medications, including Xanax (a Benzodiazepine medication) and Ambien, to alleviate his constant worrying and inability to sleep. Defendant, after reading various articles on the potentially dangerous effects of such medications and noticing a hostile change in plaintiff's demeanor, insisted that plaintiff stop taking the medications. Plaintiff's doctor began decreasing the medications, but, as a result, plaintiff began drinking alcohol in order to cope with his increased anxiety. This led to an incident in February 2002 when plaintiff was found unconscious after excessive drinking and was taken to the hospital. As a result of his consumption of alcohol while taking medication, he was taken completely off the medications. In May 2002, defendant moved plaintiff's belongings from the marital residence to an apartment which they owned. Plaintiff returned to the marital residence shortly thereafter; however, defendant demanded that he leave after she noticed the smell of alcohol. Thereafter, plaintiff sought treatment for alcohol abuse and stopped drinking. In early 2003, his doctor prescribed two prescription medications, one of which was the Benzodiazepine medicine Klonopin, to control his anxiety disorder. Although the parties engaged in marriage counseling, according to plaintiff, defendant insisted that a condition to their reconciliation was that he cease taking any and all prescription Benzodiazepine medications. In April 2004, plaintiff commenced this action for divorce on the ground of constructive abandonment. Supreme Court, crediting plaintiff's testimony, granted the divorce. The Appellate Division affirmed. Defendant contended that plaintiff failed to establish constructive abandonment inasmuch as his exclusion from the marital residence was not complete, was on consent and was justified under the circumstances. In an action for divorce based upon constructive abandonment, the party seeking the divorce must establish that the other spouse has refused to fulfill the basic obligations of the marriage relationship for a period of one year or more, without justification or consent by the abandoned spouse. In addition, the evidence must show a 'hardening of resolve' by one spouse not to live with the other. Here, defendant moved plaintiff's belongings to an apartment and demanded that he leave the marital residence. Plaintiff's testimony established that defendant denied his repeated requests to return to the marital residence. Defendant contended that she was justified in excluding plaintiff from the marital residence until he stopped taking the Benzodiazepine medication. However, it was undisputed that plaintiff suffered from a psychological anxiety disorder. Plaintiff testified that, although he had attempted to control his condition without the use of prescription medication, his doctors advised him that anxiety disorder can only be alleviated through prescription medication. Plaintiff also testified that he had no behavioral problems with his current medications and that his anxiety is under control. Defendant's uncompromising position that plaintiff choose to either adhere to the advice of his treating physicians or cease taking his anxiety medication in order to return to the marital residence, thereby risking his well-being, amounted to "an unreasonable condition as a term of their relationship," which violated her marital obligation to plaintiff

Property Is Not Marital Property Where Neither Wife Nor Husband Hold Any Valuable Property Rights in It. Defendant Not Required to List Possible Future Rights to Marital Property in Bankruptcy Schedules.

In Mattioli v Mattioli,--- N.Y.S.2d ----, 2008 WL 275078 (N.Y.A.D. 4 Dept.) the Appellate Division held that Supreme Court properly refused to treat the former marital residence, which was titled in the names of plaintiff's parents or in one of their names, as marital property subject to equitable distribution, despite the fact that plaintiff paid her father $42,899 during the marriage as a down payment towards its purchase. The court erred, however, in basing its decision solely on the fact that title to the property was held by one or both of plaintiff's parents, rather than by plaintiff and/or defendant. That fact was not necessarily dispositive because Domestic Relations Law 236(B)(1)(c) defines marital property as "all property acquired by either or both spouses during the marriage and before the execution of a separation agreement or the commencement of a matrimonial action, regardless of the form in which title is held." Thus, the dispositive issue was whether plaintiff and/or defendant held "any valuable property rights" in the former marital residence, inasmuch as property is "not marital property [where] neither the wife nor the husband [holds] any valuable property rights" in it (Pulitzer v. Pulitzer, 134 A.D.2d 84, 88). While the parties in this case alluded to an agreement between plaintiff, defendant, and plaintiff's parents for the purchase of the former marital residence, no written agreement for the purchase and sale thereof was presented to the court. In the absence of a written contract, there was no evidence before the court that either plaintiff or defendant held the requisite "valuable property rights" in the former marital residence to render it marital property. The Appellate Division held that the court erred in applying the doctrine of judicial estoppel in precluding defendant from presenting evidence of funds received by plaintiff from the sale of the former marital residence. Defendant attempted to establish that the $8,000 to $9,000 received by plaintiff from the sale of the former marital residence was marital property in the form of appreciation in the value of the property resulting from improvements he made to it during the marriage. The Supreme Court erred in relying on its decision in Matter of Miller (Berti) (1 AD3d 885) when it applied the doctrine of judicial estoppel to the former marital residence. The record established that during the marriage defendant twice filed for bankruptcy under chapter 7 of the Bankruptcy Code and received discharges, and that he claimed in both bankruptcies that he was single and did not list the former marital residence as an asset in his bankruptcy schedules. The court thus determined that judicial estoppel prevented defendant from claiming any interest in funds received upon the sale of the former marital residence. That was error, inasmuch as the discussion of the doctrine of judicial estoppel in Miller was in the context of a bankruptcy proceeding, while here the issue concerned the property rights of the parties in a matrimonial action. [M]arital property rights are determined upon the granting of a divorce", and defendant was not required to list possible future rights to marital property in the bankruptcy schedules (see 11 USC s 541[a][2][A] ). It modified the judgment by remitting the matter to Supreme Court to reopen the proof at trial to permit defendant to submit evidence that the funds received by plaintiff from the sale of the former marital residence were marital property.

Failure to Provide Client with Statement of Client's Rights and Responsibilities Constitutes Violation of DR 2-106(f) . Failure to Send Bill During One and One-half Year Divorce Proceeding Violates DR 1-102(A)(5).

In Matter of Larsen, --- N.Y.S.2d ----, 2008 WL 249850 (N.Y.A.D. 1 Dept.), a disciplinary proceeding, the First Department held that the failure of the attorney to provide her client with a Statement of Client's Rights and Responsibilities constituted a violation of DR 2-106(F). It also found that Respondent either improperly notarized her client's signature, or signed her client's name, with the client's consent, notarized that signature, and then submitted the documents to Supreme Court . This was a violation of DR 1-102(A)(4), even if done with the consent of the client. Respondent’s failure to send her client a bill during the one and one-half year divorce proceeding was held to be in violation of DR 1-102(A)(5).

 

Law Guardian May Not Be Unsworn Witness and Must Comply with Law Guardian Rules of the Chief Judge

In Naomi C v Russell A, --- N.Y.S.2d ----, 2008 WL 304936 (N.Y.A.D. 1 Dept.) the Appellate Division affirmed without a hearing Court’s dismissal of a petition to modify a custody order. The Appellate Division pointed out that with the parties present, the court asked the Law Guardian, on the record, to discuss the position of the 10-year-old child regarding how well the current custody arrangement was working. Although the court was warranted in dismissing the petition on its face, the questioning of the Law Guardian (now called Attorney for the Child) by the court was " something that should not be repeated". Although the court was correct to disallow the "cross-examination" of the Law Guardian by petitioner's counsel, the court should not consider the hearsay opinion of a child in determining the legal sufficiency of a pleading in the first place. Most importantly, such colloquy makes the Law Guardian an unsworn witness, a position in which no attorney should be placed. It emphasized that the attorney for the child is subject to the ethical requirements applicable to all lawyers, including but not limited to becoming a witness in the litigation. (Citing Rules of the Chief Judge [22 NYCRR] 7.2[b] ).

 

Attempt to Bribe Former Trail Justice Constituted Egregious Marital Fault

In Levi v Levi, 848 N.Y.S.2d 225 (2d Dept., 2007) the parties originally appeared before a Justice of the Supreme Court, Kings County and the action terminated abruptly following allegations that the plaintiff attempted to bribe the former Justice for a favorable outcome. At a criminal proceeding in 2004, the plaintiff admitted that he conspired to bribe the former Justice in the pending divorce action, providing a $10,000 payment to influence a favorable outcome on his behalf. Following a second trial, the Supreme Court equitably distributed the sole marital asset, the marital residence, entirely to the defendant, based in part, on the egregious behavior of the plaintiff in attempting to bribe the former Justice. The Appellate Division affirmed. It held that Supreme Court properly exercised its discretion in finding that the plaintiff's attempt to bribe the former Justice constituted egregious marital fault to be factored into the equitable distribution award in addition to other considerations.

 

Court of Appeals Holds that FFCCSOA and UIFSA Prohibit New York From Awarding Child Support  After Connecticut Child Support Order Expires

In the Matter of Spencer v. Spencer __NY3d___(February 14, 2008) the Court of Appeals held that when a Connecticut child support order has expired because the child has reached 18 (the age of majority under Connecticut law), and the father still resides in Connecticut, although the mother and children now reside in New York, a subsequent New York child support order for support of the same child to age 21 (the age of majority under New York law) is considered a petition for modification of the Connecticut order. Under the Full Faith and Credit for Child Support Orders Act (28 USC § 1738B) and the Uniform Interstate Family Support Act (Family Ct Act § 580-611), New York lacks subject matter jurisdiction over a modification petition where the father still resides in the state of the expired original support order, absent a consent to jurisdiction. [Click here for expanded discussion]

 

Proceeding Which must Be "Pending" in a Jurisdiction That Is "Substantially in Conformity" with the Provisions of UCCJEA Article 5-a Must Be in a Jurisdiction That Was Either the "Home State" When the Proceeding Was Commenced or Satisfies One Other Jurisdictional Predicate of DRL 76.

In re Michael McC., v. Manuella A.,--- N.Y.S.2d ----, 2007 WL 4533431 (N.Y.A.D. 1 Dept.) the Appellate Division reversed, on the law, and as a matter of public policy a Family Court determination that the court lacked jurisdiction in a custody modification proceeding after the mother fled New York with her five-year old son to Italy in the middle of the proceeding. It held that to affirm the order of the Family Court would essentially give the mother a choice of jurisdictions, and thus the concomitant right to disregard any orders of the court of which she availed herself when she failed to obtain the desired outcome. It is precisely to avoid situations like this that the UCCJEA was enacted.
The parties were married in the United States and had one child, Liam, who was born in Italy on July 22, 2001 and who had dual citizenship. A 2004 judgment of divorce entered in New York County determined that the court had no jurisdiction over custody issues because Liam had lived in New York for only 9 out of his 27 months since birth. Subsequent to filing divorce proceedings in New York, the mother filed parallel proceedings in Rome and the father consented to the court in Rome entering orders for custody and visitation. In December 2005, the Court of Rome granted the divorce and awarded the mother sole custody of Liam. The order permitted the mother to decide whether she wanted to reside in Italy or in the United States and provided for the father to have visitation under both circumstances. In July 2006, the father filed an appeal in the Appeal Court of Rome. As of January 2005, the mother (with Liam), and the father were living separately in New York. On August 16, 2006 the mother petitioned Family Court in New York to modify the Italian court's order of visitation and to suspend the father's visitation rights on the grounds that the father had abused Liam. The father cross-moved to obtain sole custody of Liam. On or about March 6, 2007 the mother fled with Liam to Italy in violation of a specific court order not to take the child out of New York State. On March 8, 2007, the father filed a violation petition under the Uniform Child Custody Jurisdiction Enforcement Act ("UCCJEA"). Subsequently, the court dismissed the family offense petition filed by the mother. On March 22, 2007, the mother's attorney appeared in Family Court alone and indicated on the record that the mother had fled to Italy because, "she does not believe she is getting a fair hearing [in Family Court]." Subsequently, family court dismissed the mother's petition for modification of an order of visitation of another court due to both her failure to appear before the court and the fact that the child abuse allegations were deemed to be false. On May 11, 2007, the father moved for an order directing that his modification petition for sole custody of Liam be calendared for an inquest and a final disposition consistent with Liam's best interests. The Family Court denied the motion and sua sponte dismissed the concluding that, while it might have jurisdiction to modify custody and enforce visitation if the mother returned, it had no "legal authority" to do so until then because she had gone to Italy and the Italian court had given her that choice.
The Appellate Division held that Family Court had jurisdiction to modify the custody order of the Italian court because New York was the child's "home state" at the time both the petition and the cross petition were filed. The UCCJEA elevates the "home state" to paramount importance in both initial custody determinations and modifications of custody orders. Under New York's UCCJEA, a New York court has jurisdiction to modify a child custody determination made by a court of another state if this state is the "home state" of the child. DRL 76-b. Moreover, the New York court continues to maintain exclusive jurisdiction until a determination is made that neither the child, nor the child and one parent have a significant connection with this state, or where
the court determines that neither the child, and neither of the child's parents reside in the state. A court of this state must treat a foreign country as if it were a state of the United States. DRL 75-d. A state is considered to be the child's "home state" pursuant to DRL 75-a(7), where the child has been wrongfully removed to another jurisdiction. In such instances, the child's stay outside of New York is considered as nothing more than a period of temporary absence and as part of the six-month period. The fact that a custodial parent flees in the middle of a custody litigation commenced properly in New York simply does not deprive the New York courts of subject matter jurisdiction to issue an order concerning custody, visitation, and related issues. The, mother, father and child were living in New York since January 2005, a period of 19 months prior to the mother's petition for a modification of the initial custody order, and 22 months prior to the father's cross petition for sole custody. Thus, New York had jurisdiction in this custody modification proceeding. Moreover, the mother's flight to Italy cannot deprive New York of continuing jurisdiction in this proceeding so long as the father resided here.
On appeal the mother argued that "home state" notwithstanding, the New York Court did not have jurisdiction because the father's appeal of the Italian court's sole custody order was pending in Rome. She relied on DRL 76- e(1) which states: "a court of this state may not exercise its jurisdiction under [article 5- A] if, at the time of the commencement of the proceeding, a proceeding concerning the custody of the child has been commenced in a court of another state having jurisdiction substantially in conformity with this article, unless the proceeding has been terminated or is stayed by the court of the other state because a court of this state is a more convenient forum ..."
The Appellate Division held that the mother's reliance on DRL 76-e was misplaced. Even though there was an appeal pending in Rome, the mother's contention failed to recognize that the "pending" proceeding must be pending in a jurisdiction that is "substantially in conformity" with the provisions of article 5-A. In other words, it must be a jurisdiction that was either the "home state" when the proceeding was commenced or satisfies one of the other jurisdictional predicates of section 76. When the appeal was filed by the father in July 2006, the Italian court did not have jurisdiction "substantially in conformity" with the UCCJEA since by that time New York, not Italy, was the "home state". In July 2006, both parties and Liam had been living in New York for approximately 18 months. It also held that contrary to the mother's argument, the court also erred in ruling New York to be an inconvenient forum pursuant to DRL 76-f(1) because it court failed to consider the relevant statutory factors. See DRL 76-f[2](a)-(h) and by commencing the instant action in New York, the mother purposely availed herself of this state's jurisdiction. Given that the child attended school in New York and many of the relevant documents and witnesses were in New York it could not be said that New York was an inconvenient forum. As the court below noted, the Italian court's order did not specifically prohibit jurisdiction eventually passing to another state. In April of 2004, the Italian court was the proper jurisdiction for the initial custody proceeding because the child had lived in New York for only 9 out of his 27 months since birth, and those nine months were apparently not immediately preceding the commencement of the action. By the time the mother filed to modify the Italian custody order in August 2006 in Family Court, Italy no longer had exclusive, continuing jurisdiction pursuant to DRL 76-a because New York had become the child's "home state" and both parents were living in New York by that time. The cross petition was reinstated and the matter remanded for further proceedings consistent with the decision, including a custody inquest.

Refining its Definition of Habitual Residence Sixth Circuit Rejects Mozes and Adopts Friedrich Rule

In Robert v Tesson, 507 F.3d 981 (6th Cir., 2008), the Sixth Circuit held that Friedrich I's edict (Friedrich v Friedrich, 983 F.2d 1396, 1400 (6th Cir.1993) ("Friedrich I") that "the court must focus on the child, not the parents, and examine past experience, not future intentions" controlled the case. Recognizing that Friedrich I was the first United States Court of Appeals case to consider the meaning of "habitual residence" under the Hague Convention, and that it presented a far simpler set of facts than the ones at issue  the court refined the holding in Friedrich I, without disturbing Friedrich I's core holding that habitual residence under the Hague Convention is determined by the child's experience, not by the parents' subjective intent. To this end, it held "that a child's habitual residence is the place where he or she has been physically present for an amount of time sufficient for acclimatization and which has a degree of settled purpose from the child's perspective." The Court recognized that a very young or developmentally disabled child may lack cognizance of their surroundings sufficient to become acclimatized to a particular country or to develop a sense of settled purpose, but this case did not present it with such a child. Therefore, it stated that it expressed no opinion on whether the habitual residence of a child who lacks cognizance of his or her surroundings should be determined by considering the subjective intentions of his or her parents. [Click here for expanded discussion]

 

Creation of Joint Account Vests in Each Tenant a Present Unconditional Property Interest in Undivided One Half of Money

In Bailey v Bailey, --- N.Y.S.2d ----, 2008 WL 275056 (N.Y.A.D. 4 Dept.) the Appellate Division held that although the court properly determined that plaintiff was entitled to retain the amount of $43,000 she had removed from the parties' joint HSBC checking accounts containing $66,000, the court erred in allocating the entire amount as separate property. "The creation of a joint account vests in each tenant a present unconditional property interest in an undivided one half of the money deposited, regardless of who puts the funds on deposit The creation of a joint account vests in each tenant a present unconditional property interest in an undivided one half of the money deposited, regardless of who puts the funds on deposit" (Parry v. Parry, 93 A.D.2d 989, 990; see Nasca v. Nasca, 302 A.D.2d 906). Thus, each party was entitled to a distributive award of $33,000 from that account. The Appellate Division held that the court properly distributed the various retirement accounts. The appreciation to defendant's Vanguard Money Market Reserves Account was marital property because plaintiff indirectly contributed to the appreciation of this asset by handling the household matters, thereby permitting [defendant] the freedom to devote energy to his financial endeavors. The remaining accounts in question contained commingled marital property and separate property, and defendant failed to trace the source of the funds [that he contended were separate property] with sufficient particularity to rebut the presumption that they were marital property.

 

"Substantial Change in Circumstances" Standard Correct Where Supreme Court Refers Child Support to Family Court

In Zwickel v Szajer,--- N.Y.S.2d ----, 2008 WL 191640 (N.Y.A.D. 3 Dept.) in April 2003 the Support Magistrate entered an order for child support. Shortly thereafter, plaintiff commenced an action for divorce where the issue of child support was referred to Family Court. At about the same time, plaintiff commenced a proceeding, pursuant to Family Ct Act article 4, alleging a violation of the April 2003 order. After a hearing on both matters, the Support Magistrate found that defendant was in willful violation of its prior order and, by separate order, that there was no substantial change in circumstances to warrant an upward modification of child support. Plaintiff's objections were denied by Family Court. The Appellate Division agreed with Family Court that the Support Magistrate applied the correct standard in determining plaintiff's application for an upward modification of the April 2003 order of support. It held that in a matrimonial action, unless a prior support order from Family Court is continued by Supreme Court, the prior order terminates when Supreme Court makes a new support determination. As no such order was issued by Supreme Court, instead referring the matter to Family Court to determine the application, the "substantial change in circumstances" standard was correctly applied upon plaintiff's application for a modification of the Support Magistrate's prior order of support (Citing Cynoske v. Cynoske, 8 A.D.3d 720, 722-723 [2004] ). Ed Note: In Blauner v Blauner, 60 App Div 2d 215 ( 1st Dept.1977) the First Department held that when divorce follows separation the court may consider child support de novo. In Kover v Kover, 29 N.Y.2d 408 (1972) the Court of Appeals held that alimony may be considered de novo).

 

Wilful Violation Order Reversed Based Upon Ineffective Assistance of Counsel In Support Enforcement Proceeding

In Matter of Martin v Martin, --- N.Y.S.2d ----, 2007 WL 4530824 (N.Y.A.D. 3 Dept.) petitioner father and respondent stipulated to a joint custody arrangement, whereby the father would pay child support of $200 per week. In 2004 the mother sought a finding that the father had willfully violated the order of support and the father sought modification of his support obligation. In his petition, the father listed verbal agreements and health as the change in circumstances justifying modification. On the first day of trial, the father's attorney attempted to introduce medical records but, after the mother objected, the Support Magistrate refused to receive the records "at this time," apparently in the absence of proper authentication. The father testified that in the spring and summer of 2003 his business collapsed, he was diagnosed with an illness which crippled his ability to work until approximately January 2005 and, between September 2003 and May 2004, he lived with the mother and their children under an agreement that he would perform the duties of a "stay-at-home parent" in lieu of support payments. On the second day of trial a month later, the father attempted to introduce the testimony of his therapist who was apparently prepared to testify that during an addiction counseling session the parties had "agreed to have [the father] provide services instead of providing child support dollars." However, the mother objected to such testimony on the ground that it was privileged. The Support Magistrate adjourned the trial for research on the issue of privilege. Thereafter, the Support Magistrate determined that the mother was involved in the counseling only for the purpose of assisting with the father's therapy and that the therapist would be permitted to testify as a fact witness regarding the alleged agreement. On the date of that decision--May 5, 2005--the Support Magistrate set the next date for the continuation of the trial for June 28, 2005. On June 28, 2005, almost eight weeks after her decision, the Support Magistrate was prepared to accept the therapist's testimony. The father's attorney, reported to the court that the therapist was not available and requested that another date be set for the therapist's testimony or, in the alternative, that the mother consent to the receipt in evidence of the therapist's affidavit, which had been submitted previously in support of the father's earlier assertion that the therapist should be allowed to testify. The mother objected to both of these options, and the Support Magistrate agreed. The father's testimony resumed and it was revealed that he had recently been incarcerated on pending criminal charges. The mother testified that the father had indeed resided with her and the children at times and that she had attended therapy sessions with him, but she asserted that they had not entered into any agreement to suspend child support. After again denying the father's requests for an opportunity to call the therapist or introduce the therapist's affidavit, the Support Magistrate ruled from the bench dismissing both petitions based on the father's failure to establish a change in circumstances and finding that he had willfully violated a support order. In her ruling, the Support Magistrate noted that no medical evidence of the father's alleged inability to work due to diminished health was introduced, incarceration is not a basis to modify an order of support, and no credible evidence supported his claims regarding the alleged arrangement between the parties. She issued an order finding that he willfully violated an order of support. Family Court affirmed. The Appellate Division rejected the father's contention that the Support Magistrate's refusal to adjourn the trial so that a key witness could be located amounted to an abuse of discretion and that the decision to not consider the therapist's affidavit in place of his testimony was error. "The grant or denial of a motion for 'an adjournment for any purpose is a matter resting within the sound discretion of the trial court. Here, it was clear that the father's inability to produce the therapist resulted from his counsel's lack of due diligence in preparing for the hearing. His counsel conceded that he never spoke directly with the therapist--simply asserting that a letter was sent and it never came back so "[he] expected him to be [t]here"--and there was no indication in the record that any pretrial attempt was made to obtain a continuance or to reschedule. As for the refusal to admit the therapist's affidavit into evidence, the father failed to suggest any basis on which admission of that hearsay document would have been permissible. The court was persuaded by the father's ineffective assistance of counsel claim based upon his attorney's failure to present sufficient evidence regarding his medical condition and to ensure that a key witness was present at trial. Under Family Ct Act 262(a)(vi), a person has the right to the assistance of counsel in any proceeding before the court in which an order or other determination is being sought to hold such person in contempt of the court or in willful violation of a previous order of the court. The standard for effective assistance of counsel here is whether, viewed in its totality, the representation was meaningful and whether actual prejudice was suffered as a result of claimed deficiencies. The father's initial modification petition and his defense to the willful violation allegations turned on his health-related inability to work due to his treatment for a serious illness and an alleged agreement with the mother to suspend his support payments, and his counsel did not get important evidence admitted that would have advanced these assertions. Counsel failed to properly obtain authentication for the father's medical records, call any witnesses to testify as to the effects of the father's illness, subpoena the therapist, or otherwise ensure his availability as a witness on the trial date. Family Court made specific reference to the lack of medical evidence in its decision, finding that the father had not refuted the mother's prima facie showing of willfulness, and affirmed the specific finding that no credible proof was offered to support the father's assertions of an agreement between the parties--the precise issue on which the therapist was to testify. Had this proof been admitted into evidence, the father would have had independent verification for his assertions which may have relieved him of several months worth of support obligations and may have undermined the allegation of willfulness. Taken together, the omissions constituted a failure to meaningfully represent the father, and he was entitled to a new hearing on his initial modification petition and the mother's violation petition.

 

Hearsay Evidence of Abuse or Neglect Admissible and May Be Considered in Custody Case Where Corroborated

In Matter of Bartlett v Jackson,--- N.Y.S.2d ----, 2007 WL 4722934 (N.Y.A.D. 3 Dept) the mother argued on appeal that Family Court incorrectly admitted hearsay evidence and then relied upon such evidence in its custody decision. The Appellate Division held that in custody proceedings involving allegations of abuse or neglect, hearsay statements of the child pertinent to those allegations may be admitted and considered so long as they are corroborated by other evidence.

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Father Directed to Put 50% of Child Support Obligation in Escrow until the Mother Can Certify Compliance with Visitation Order and Absence of Interference with Father's Visitation Rights

In Matter of Lew v Sobel,--- N.Y.S.2d ----, 2007 WL 4555624 (N.Y.A.D. 2 Dept.) the Appellate Division noted that a custodial parent's deliberate frustration of, or active interference with, the noncustodial parent's visitation rights can warrant the suspension of future child support payments (citing Domestic Relations Law 241) In view of the evidence presented at the hearing and the Supreme Court's determination that the mother deliberately had interfered with the father's visitation rights, it directed the father to pay 50% of his child support obligation to the mother's attorney, to be held in an escrow account until the mother can certify, to the satisfaction of the Supreme Court, her compliance with the visitation provisions of the first order dated April 28, 2006, and the absence of her interference with the father's visitation rights. When the mother can establish to the satisfaction of the court that she was not interfering with the father's visitation with the children, there will then be a basis to direct the mother's attorney to release, to the mother, the child support payments held in escrow. It also held that under the circumstances of this case, the Supreme Court should have reapportioned the parties' responsibility for the fees of the therapeutic visitation facilitators, the Law Guardian, and the forensic evaluator employed during the course of the proceeding so that the mother was responsible for 75% of such fees and the father was responsible for 25% of such fees.

 

Strict Application of Tropea Factors Not Required When There No Prior Custody Award

In Streid v Streid, --- N.Y.S.2d ----, 2007 WL 4440940 (N.Y.A.D. 3 Dept.) the father filed a petition seeking custody of the children, after the mother removed them from the marital home and relocated to Georgia without his consent. Family Court awarded custody to the mother, provided that she remained in New York. The Appellate Division affirmed. It noted that the mother was correct that a strict application of the factors set forth in Matter of Tropea v. Tropea (87 N.Y.2d 727 [1996] ) is not required when there is no prior award of custody (citing Furman v. Furman, 298 A.D.2d 627, 628-629 [2002], lv dismissed and denied 99 N.Y.2d 575 [2003] ). Nevertheless, a parent's decision to reside in a distant locale is a very important factor among the constellation of factors to be considered in arriving at a best interests determination, particularly where there is evidence that it would detrimentally affect the other parent's relationship with the children. Other relevant factors to be considered include the ages of the children, fitness of the parents, quality of the home environment, each parent's ability to provide for the child[ren's] intellectual and emotional development, and the effect the award of custody to one parent would have on the children's relationship with the other. After considering the mother's role as the primary caregiver and the father's strong relationship with the children and significant involvement in their educational and extracurricular activities, as well as the incidents of domestic violence perpetrated by both parties and the mother's alcohol abuse, the award was proper.

 

Where Every CSSA Requirement Met But BCSO Miscalculated, That May Not Be Enough to Invalidate Agreement

In Sullivan v Sullivan, --- N.Y.S.2d ----, 2007 WL 4441111 (N.Y.A.D. 3 Dept.) the parties settlement agreement was incorporated, but not merged, into a February 2005 judgment of divorce. When plaintiff moved to enforce the maintenance and child support provisions, defendant cross-moved to have them declared void. Supreme Court denied defendant's motion.. The Appellate Division affirmed. It noted that the agreement indicated that the parties were advised of the Child Support Standards Act, the presumptive amount which would be awarded thereunder, albeit miscalculated, and the reasons why the parties sought to deviate therefrom. While agreeing that an omission of the non-waivable statutory requirements would render the agreement void, the Appellate Division held that where, as here, each and every other statutory requirement is met, yet the basic child support obligation from which the deviation is sought is stated but miscalculated, that alone may not be enough to invalidate the agreement. It was clear that the error emanated from the parties' failure to deduct the agreed upon maintenance from defendant's income prior to the calculation under the CSSA. The error resulted in defendant's agreement to pay child support of $1,500 when the presumptively correct CSSA amount would have been $1,548. With the settlement agreement providing that there will never be any upward modification of child support, only a downward modification based upon defendant's income, and that all of the enumerated tax benefits would enure to defendant, despite the fact that they would have been properly credited to plaintiff, the Appellate Court found no basis upon which it would void the otherwise valid child support provisions in the agreement. Moreover, with Supreme Court having stated its reasons for allowing the deviation in its decision supporting the issuance of the judgment of divorce on the same date when it permitted the incorporation of the parties' agreement in the action for divorce, there was no viable challenge to the judgment.

 

Evidence By Unnamed Preparer is Outside Business Record Exception to Hearsay Rule

In Re Ashley Lisa D, --- N.Y.S.2d ----, 2007 WL 4390621 (N.Y.A.D. 1 Dept.) the Appellate Division held that Family Court properly excluded from evidence the Very Intensive Preventive Services program closing summary and a psychological evaluation by an unnamed preparer, as these documents do not fall under the business record exception to the hearsay rule (citing Matter of Bronstein-Becher v. Becher, 25 AD3d 796, 797 [2006] ).

 

Failure to Indicate If Amount of Child Support Was Presumptively Correct or If it Represented Deviation from CSSa Renders it Void. Not Error to Utilize Amount of Maintenance Actually Paid.

In Bellinger v Bellinger, --- N.Y.S.2d ----, 2007 WL 4441204 (N.Y.A.D. 3 Dept.)Supreme Court partially granted defendant's motion prior to trial to set aside the child support provisions of the parties stipulation because it did not indicate whether the amount of child support was presumptively correct or whether it represented a deviation from the Child Support Standards Act. Following trial, Supreme Court’s judgment of divorce awarded child support in an amount in excess of that contained in the prior stipulation, ordered plaintiff to pay defendant $2,475 in previously owed car insurance and determined that defendant was entitled to submit an application for counsel fees, and awarded defendant counsel fees of $15,874.47. The Appellate Division held that as no appeal was taken from the order vacating that portion of the stipulation that dealt with child support this issue was not properly before it. In any event, Supreme Court correctly determined that the stipulation failed to comply with nonwaivable requirements of the CSSA. Supreme Court correctly found that the before-tax health insurance deductions in the sum of $1,895 .05 were a fringe benefit provided as part of plaintiff's compensation for employment and includable in the calculation of his income for child support purposes. There was no error in the inclusion of $15,496 .56 in plaintiff's income. Contrary to his claim that this was a one-time nonrecurring payment, the record revealed that he received a similar cash payment in 2003 and the record reflected that his income had consistently increased for three consecutive years. Under these circumstances, even assuming the one-time nature of this payment, Supreme Court permissively exercised its broad discretion to impute that sum as income to plaintiff. With respect to maintenance, plaintiff pointed out that his annual maintenance payment would be $9,804, but that Supreme Court gave him credit only for the amount actually paid in 2005 ($7,353). As the statute authorizes a deduction for "alimony or maintenance actually paid or to be paid to a spouse that is a party to the instant action" (Domestic Relations Law 240[1-b][b][5][vii][C] ), there was no error in Supreme Court utilizing the figure actually paid. With respect to plaintiff's argument that he received improper credit for FICA contributions, it held that Supreme Court committed a minor error in only deducting $5,580 for Social Security and not including $1,648.98 for Medicare. After plaintiff received credit for the Medicare portion of his FICA deduction, his income for child support purposes was $97,549. When added to defendant's income of $21,298.39, the combined parental income was $118,847.39. As the parties had two children, application of 25% to this income yielded an annual child support obligation of $29,711.85 or $571.38 per week. Plaintiff was responsible for 82% of this total or $468.53.

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DRL 236 [B](6)(a)(1) Contains No Express Time Limitation with Respect to Calculating Income for Maintenance Award.

In Haines v Haines, 44 A.D.3d 901, 845 N.Y.S.2d 77 (2d Dept.2007) Supreme Court awarded the plaintiff maintenance of $1,200 per month until May 1, 2019. The Appellate Division reduced the award to $900 per month until May 1, 2019, or until the death of either party or the plaintiff's remarriage, whichever shall occur sooner. The Appellate Division held that Supreme Court improvidently exercised its discretion in failing to impute income from the plaintiff's second job as a data entry clerk since that income contributed to the predivorce standard of living and was demonstrative of the plaintiff's earning capacity. The plaintiff had been working at the second job for several years prior to the commencement of the matrimonial action, and the defendant had been working for considerably more than 40 hours per week during this time period. While the plaintiff had been earning only approximately $39,000 per year at the time of the commencement of this action, by the time the matter was heard by the trial court, she had increased her earnings to approximately $56,000. Unlike the Equitable Distribution Law, Domestic Relations Law s 236(B)(6)(a)(1) contains no express time limitation with respect to calculating income. Thus, when considering the "income and property of the respective parties," the trial court should not exclude any property or income increase which has occurred between the time of commencement of the action and the time of trial. Accordingly, the trial court should have attributed to the plaintiff a yearly income of $56,000. Additionally, the trial court erred in failing to include a provision that the award of maintenance will terminate upon the death of either party or the plaintiff's remarriage.

 

First Department Holds That Request for Extension to File Objections under FCA 439(e) is Procedural and Can Be Granted At Any Time

In Judith S. v Howard S. ,--- N.Y.S.2d ----, 2007 WL 4336196 (N.Y.A.D. 1 Dept.) the Appellate Division affirmed an order of Family Court, which denied respondent father's motion for an extension of time to file objections to the final order of child support issued by the Support Magistrate six months earlier. Respondent father failed to file objections to the final order of child support within the 35-day period set forth in Family Court Act 439(e). It pointed out that CPLR 2004, upon which he relied, contains general authorization for a court to "extend the time fixed by any statute, rule or order for doing any act." It noted that the scope of this section was restricted by the Second Department to "extensions of time for the doing of acts in actions and proceedings and not for the doing of acts which are substantive in character and provided for under other statutes " (Matter of Powers v. Foley, 25 A.D.2d 525 [1966], emphasis added). The request in this case was directed at a procedural time limitation, and not a substantive one, and thus could have been granted even if based on a statute outside the CPLR. However, CPLR 2004 additionally requires a showing of "good cause," and respondent father had not demonstrated good cause for failing to file timely objections. Settlement negotiations alone are an insufficient excuse for delay, and the prejudice that would result to petitioner as a result of the father's delay in filing objections was obvious, given his chronic failure to meet his child support obligations in a full and timely fashion, with no effort to pay down his substantial arrears. The Court pointed out that the Third Department denies its application to time limits set forth in any statutes or regulations "other than those contained in the CPLR" (Matter of Carassavas v. New York State Dept. of Social Servs., 90 A.D.2d 630 [1982] ), and has consistently held to that position (see Matter of Monahan v. Hartka, 17 A.D.3d 758, 759 [2005] ).

Family Court Required to Consider Whether Cola Increase Should Be Applied and to Review Order To Determine Whether Adjustment Warranted Based on Guidelines

In Matter of Palmer v Palmer. --- N.Y.S.2d ----, 2007 WL 4328453 (N.Y.A.D. 2 Dept.), at the mother's request and the SCU issued a cost-of-living adjustment order, which increased the father's monthly support obligation. The Appellate Division held that in considering the father's objections to the COLA increase, the Family Court was required to consider not only whether the COLA increase should be applied, but also to review the order "to determine whether an adjustment is warranted based on the guidelines" set forth in Family Court Act 413 (citing Matter of Tompkins County Support Collection Unit v. Chamberlin, 99 N.Y.2d 328, 335; see Family Ct Act s 413-a[3][b][1]; Social Services Law s 111-n [5][b] ). In the order appealed from, however, was apparent that the Family Court did neither. As a matter of law, the court's calculation was flawed inasmuch as it assumed, incorrectly, that each parent's share of child support could be determined simply by applying the statutory child support percentage of 17% to that party's gross income. Under the Family Court Act, the child support percentage of 17% must be applied to the "combined parental income" , up to $80,000, and the amount must then be "prorated in the same proportion as each parent's income is to the combined parental income" . Moreover, if the combined parental income exceeds $80,000, then "the court shall determine the amount of child support for the amount of the combined parental income in excess of such dollar amount through consideration of the facts set forth in [Family Court Act s 413(1)(f) ]" (Family Ct Act s 413[1][c][3] ). Here, the Family Court's methodology failed to account for the mother's gross income and its possible impact on the father's prorated share of child support. It also held that Family Court improvidently exercised its discretion by using the SCU's adjusted support obligation amount, which had been calculated in accordance with Social Services Law 111-n(4)(a), without regard to the guidelines contained in Family Court Act s 413, to compute a gross income figure, which the court then imputed to the father pursuant to Family Court Act 413(1)(b)(iv). Among other things, the Family Court failed to appreciate that, pursuant to the prior order, only part of the father's support obligation represented his prorated share of 17% of what was then the combined parental income. The remaining amount represented his prorated share of health care, child care, educational, and other extraordinary expenses.

When QDRO Conflicts with Stipulation of Settlement the Stipulation Controls, and QDRO must Be Modified Accordingly

In Condon v Condon, --- N.Y.S.2d ----, 2007 WL 4328729 (N.Y.A.D. 2 Dept.) the Appellate Division held that a proper QDRO obtained pursuant to a stipulation of settlement can convey only those rights to which the parties stipulated as a basis for the judgment. It agreed with the former husband's contention that the distribution of his pension as ordered in the QDRO differs from the distribution of the pension as stated in the parties' stipulation of settlement. The plain language of the relevant provision of the stipulation of settlement governing the former husband's pension stated that the former wife shall be entitled to a 50% interest in the retirement plan as calculated from the date of marriage through the date of separation, that is, 50% of the benefits earned during the relevant 17-year period the former husband was working and was a member of the pension plan. However, the QDRO directed that the former wife receive a percentage of the former husband's pension based upon his final pension benefits, and was not limited to her interest in it as provided for in the stipulation. When the QDRO conflicts with the stipulation of settlement upon which it was based, the stipulation of settlement controls, and the QDRO must be modified accordingly. The court also held that the former wife was entitled to share in cost-of-living adjustments in retirement benefits as long as the increases were limited to her portion of the pension.

Family Court Lacks Authority to Enforce Provisions of Settlement Agreement Pertaining to Distribution of Equity of Marital Residence.

In Gambacorta v Gambacorta, --- N.Y.S.2d ----, 2007 WL 4183000 (N.Y.A.D. 2 Dept.) the parties judgment of divorce incorporated by reference, but did not merge, a stipulation of settlement, which provided for distribution of the remaining equity in the marital residence, allocated responsibility for debts incurred by the former wife and required the former husband to pay the wife maintenance and for certain dental expenses. The Appellate Division held that contrary to the husband's contention, the Family Court is authorized by statute to entertain petitions for the enforcement of an order or decree awarding maintenance or support, and to enter money judgments for support arrears, unless the Supreme Court expressly retains exclusive jurisdiction to enforce the terms of a judgment of divorce (see Family Ct Act s 466[c]. However, Family Court, as a court of limited jurisdiction, lacked authority to determine so much of the wife's petition as sought to enforce those provisions of the Settlement Agreement which pertain to distribution of the equity of the marital residence. The Settlement Agreement also required the husband to pay up to $5,000 towards dental work to be provided to the wife. The husband only submitted evidence sufficient to prove payment of $2,500 to the wife's dentist. The unsworn letter from the dentist stating that a total payment of $5,000 had been received did not have the indicia of reliability associated with a receipt or business record, because it was not created contemporaneously with the purported payments and there was no showing that it was created in the ordinary course of business (see CPLR 4518[a] ). Accordingly, the husband was obligated to pay $2,500 to the wife for dental expenses.

 

Service of Trial Subpoena on Attorney Permitted as of January 1, 2008

CPLR 2303-a has been enacted to reduce the need for service of trial subpoenas on a party or person within the party's control. It provides that where the attendance at trial of a party or person within the party's control can be compelled by a trial subpoena, that subpoena may be served by delivery in accordance with CPLR 2103 (b) to the party's attorney of record. CPLR 2303 allows for service of a subpoena in the same manner as all other papers which are served by one attorney on another pursuant to CPLR. 2103. This provision only modifies the method of service of the subpoena. It does not change the requirement for a fee to be provided with the subpoena. Laws of 2007, Chapter 192, Effective January 1, 2008.

Fine for Violating Subpoena Increases to $150 as of January 1, 2008

CPLR 2308(a) was amended to increase the maximum penalty for disobeying a judicial subpoena from $50 to $150. Laws of 2007, Chapter 205, Approved July 3, 2007 and effective January 1, 2008.

Domestic Relations Law 177 Enacted Effective November 1, 2007

Domestic Relations Law 177 becomes effective November 1, 2007. Subdivision 1 provides that provide that prior to accepting any agreement between the parties in an action for a divorce, the judge is required to ensure that the agreement contains a provision relating to the health care coverage of each individual. The agreement must either provide for the future coverage of the individual, or state that the individual is aware that he or she will no longer be covered by his or her spouse's health insurance plan. Every agreement accepted by the court must contain the follow ingstatement, signed by each party, to ensure that the provisions of this subdivision are adhered to:
" I, (spouse), fully understand that upon the entrance of this divorce
agreement, I may no longer be allowed to receive health coverage under
my former spouse's health insurance plan. I may be entitled to purchase
health insurance on my own through a COBRA option, if available, other-
wise I may be required to secure my own health insurance.
____________________________ ____________
(Spouse's signature) (Date)"

If, prior to accepting an agreement and entering the judgement thereon, the judge determines that the provisions of DRL 177 have not been met, the judge must require the parties to comply with the this section and may grant a thirty day continuance to afford the parties an opportunity to procure their own health insurance coverage.
Subdivision 2 provides that before rendering a decision in an action for divorce, the judge must ensure that he or she notifies both parties that once the judgement is entered, a person may or may not be eligible to be covered under his or her spouse's health insurance plan, depending on the terms of the plan. Laws of 2007, Ch 412.
 

New Domestic Relations Law 250 Applies to Prenuptial and "Opting-out" Agreements

Domestic Relations Law 250 was enacted effective July 3, 2007. It is intended to toll the statute of limitations for causes of actions and defenses related to prenuptial and post-nuptial ("opting-out") agreements until both parties have made appearances in a matrimonial action. It enacts a three year statute of limitations for commencing an action or proceeding or for claiming a defense that arises from an agreement made pursuant to DRL 236 [B][3] entered into prior to a marriage, or during the marriage, but prior to the service of process in a matrimonial action or proceeding. The statute of limitations is tolled until process has been served in a "matrimonial action or proceeding", or the death of one of the parties. DRL 250 does not apply to a separation agreement or an agreement made during the pendency of a matrimonial action or in settlement of a matrimonial action. The provisions of DRL 250 do not apply to prenuptial agreements where the commencement of an action on the agreement was barred under the CPLR in effect immediately prior to July 3, 2007, its effective date.

 

Cost of Living (Cola) Child Support Provision Interpreted as "Opting Out" of CSSA Guidelines Requiring Parties' Reasons for Deviating

In Fasano v Fasano, --- N.Y.S.2d ----, 2007 WL 2729684 (N.Y.A.D. 2 Dept.) the parties separation agreement dated October 21, 1993, provided, inter alia, that until October 31, 1996, the plaintiff would pay the defendant maintenance of $5,416.66 per month and child support of $833.33 per month. After October 31, 1996, the plaintiff's maintenance obligation would end and his monthly child support obligation would increase to $3,333 .33. The child support provisions of the separation agreement also obligated the plaintiff to pay increased child support in the event of increases in the cost of living, as reflected in the Consumer Price Index for the New York Metropolitan area. The separation agreement was incorporated, but not merged, into the judgment of divorce dated February 17, 1994. The Appellate Division held that the child support provision which set the plaintiff's child support obligation at the sum of $3,333.33 per month was not invalid on the ground that it failed to calculate the presumptively correct amount of child support pursuant to the Child Support Standards Act. A provision stating the correct amount of the basic child support obligation under the CSSA is not required unless it is apparent that the parties have "opted out" of the basic child support obligation pursuant to the CSSA. Here, the child support obligation in the sum of $3,333.33 per month did not differ significantly from the correct amount as calculated by a strict application of the statute, and thus, such provision in the separation agreement cannot reasonably be interpreted as indicating that the parties intended to "opt out" of the basic child support obligation pursuant to the CSSA. However, the plaintiff correctly contended that the provision contained in paragraph 5, Article F, of the separation agreement, allowing for adjustments to his monthly child support obligation based on cost of living increases (hereinafter the COLA provision), failed to comply with Domestic Relations Law 240(1-b)(h). The annual increases in the child support obligation permitted under the COLA provision represented potential deviations from the basic child support obligation and, therefore, can be interpreted as providing for an "opting out" of the CSSA guidelines. Since the separation agreement failed to state the parties' reasons for deviating from the CSSA guidelines with respect to the potential COLA increases, the COLA provision violated Domestic Relations Law 240(1-b)(h) and should have been set aside.

 

Proper to Grant Extension of Time to Serve Summons After Traverse Hearing Finds Service Not Effected

In Yamamoto v Yamamoto, --- N.Y.S.2d ----, 2007 WL 2445200 (N.Y.A.D. 1 Dept.) the Supreme Court denied plaintiff's request that service of the summons and complaint on defendant be permitted by personal delivery to his attorneys but granted her motion for an extension of time to serve the summons and complaint and permitted her to apply for reimbursement of attorney fees and costs to defray the expense of effectuating service on defendant in Japan, subject to reallocation at trial, from the escrowed proceeds of the sale of the marital home. Thereafter, Supreme Court granted defendant's motion to confirm the Referee's report to the extent that the Referee found defendant had not been personally served and granted plaintiff's motion to extend her time to serve defendant, in accordance with the prior order. The Appellate Division affirmed the orders. It held that Supreme Court did not improvidently exercise its discretion in granting plaintiff an extension of time to serve defendant, pursuant to the Hague Convention on the Service Abroad of Judicial and Extrajudicial Documents in Civil or Commercial Matters (20 UST 361 [1965] ). Although it found that defendant had not been properly served, given plaintiff's demonstration of reasonably diligent attempts to serve the defendnat within the 120-day period after filing the summons with notice (CPLR 306-b), her reasonably prompt request for the extension, and the absence of prejudice to defendant, who had long had notice of plaintiff's claims the extension was warranted in the interest of justice. In view of the procedures in place for effectuating service upon defendant in Japan, and the absence of any evidence that service in that manner was "impracticable," the court properly denied plaintiff's request, pursuant to CPLR 308(5), for an order directing that service on defendant be effectuated by personal delivery of process upon his attorneys. Given defendant's alleged removal to Japan and his alleged failure to provide any support for his infant daughter, who allegedly lived in Manhattan with her mother, the court providently granted plaintiff leave to apply for funds to defray the additional expense of effectuating personal service upon defendant in Japan pursuant to the Hague Convention on the Service Abroad. Defendant, who appeared and testified at the traverse hearing and, according to plaintiff, allegedly maintains an apartment in Manhattan, may, as suggested by the IAS court, avoid any more delay and expense in having this marital and child-support dispute resolved by authorizing his New York attorney to accept service of process on his behalf.

Unauthorized Ex Parte Conversatons May Be Basis to Disqualify Court Appointed Evaluator.

In Reback v Reback, 41 A.D.3d 814, 839 N.Y.S.2d 516 (2d Dept.,2007) Supreme Court appointed a neutral financial evaluator to consider the value of the parties' assets (i.e., the plaintiff's real estate license and the defendant's businesses). Pursuant to that order, prior to the completion of the evaluator's report, ex parte communications were prohibited except that a party could advise the evaluator in writing about assets he or she thought the other spouse owned. The evaluator was directed to communicate with the parties in writing with copies to counsel for both sides or by conference call. The Appellate Division found that ex parte conversations between the court appointed evaluator and the plaintiff and her counsel were not authorized by the order appointing the evaluator and therefore were improper. It held that the question of whether the impropriety was sufficient to disqualify the evaluator depends on the nature of the conversations. If, as the plaintiff contended, the conversations related solely to ministerial matters, the impropriety would not be sufficient to justify disqualification of the evaluator. It was inappropriate to place the burden of proof as to the nature of those conversations on the defendant There should have been a hearing to determine whether the nature of those conversations would justify disqualification of the evaluator.

Court of Appeals Holds That Adoptive Mother Who Surrenders Child Liable For Child Support.

In Matter of Greene County Department of Social Services o/b/o Ward v Ward, --- N.E.2d ----, 2007 WL 1672315 (N.Y.) Dawn Ward, an unmarried registered nurse, adopted a special needs child on June 20, 2002. He was born prematurely at 27 weeks. Although Jeffrey tested positive for cocaine and syphilis at birth, Ms. Ward was informed that his mother had not habitually used drugs and alcohol during her pregnancy, and that Jeffrey was a "quiet, gentle and pleasant child." Jeffrey was placed with Ms. Ward on May 3, 2001. At the time of placement, he was three years old, weighed 25 pounds, drank from a bottle, was non-verbal, and had been diagnosed with mild cerebral palsy and asthma. Ms. Ward enrolled Jeffrey in an early intervention program and he underwent surgeries to improve his swallowing and breathing capabilities. His emotional and mental development was delayed. In 2001 and 2002, Jeffrey exhibited increasingly aggressive behavior. He began eating sand and grass, biting, licking and spitting at adults, and exhibiting bouts of uncontrolled yelling. By October 2002, Jeffrey's behavior had deteriorated even further. He regressed in toileting, dressing, and eating. His behavior at daycare now included head-banging, hitting and kicking other children and throwing chairs and objects. In February 2003, he was diagnosed with pervasive developmental disorder. Jeffrey's play therapist advised Ms. Ward that Jeffrey had significant neurological issues resulting from exposure to drugs and alcohol in utero. Another psychiatrist diagnosed him with attachment disorder, obsessive-compulsive disorder and autism. Jeffrey's behavior did not improve. He injured both himself and Ms. Ward during the summer of 2003, and had frequent bouts of uncontrollable behavior. On September 2, 2003, Ms. Ward went to the Department of Social Services and asked for a temporary relinquishment of parental rights. When DSS refused to accept a temporary relinquishment, Ms. Ward decided that returning Jeffrey to her home would pose too great a risk to his and her safety, and permanently surrendered her parental rights before a Family Court judge. In 2004 a support magistrate found her liable for child support as the adoptive parent of Jeffrey from the date of surrender. Family Court charged Ms. Ward with "$133.54 weekly child support commencing February 4, 2005 and $10,015.50 arrears from September 2, 2003 through January 28, 2005. The Appellate Division affirmed. In the Court of Appeals Ms. Ward contended that she should be exempt from the child support obligation as the single "parent" of a "child born out of wedlock" and that in the alternative DSS should be equitably estopped from enforcing the support order. It disagreed. It pointed out that an adoptive parent assumes all of the liabilities of a biological parent. Upon voluntary surrender, a parent retains the obligation to provide financial support for a child until he or she is adopted or turns twenty-one. Although the Social Services Law carves out a limited exception from this support requirement for children born out of wedlock to unwed mothers (see SSL 398[6][f]; 18 NYCRR 422.4), this exception did not apply to Ms. Ward. As Jeffrey was not "begotten and born" to her, she did not qualify as the "mother of a child born" out of lawful matrimony (FCA 512). Like the Appellate Division, the Court acknowledged the apparent harsh result in this highly unusual case, but could not conclude that the doctrine of estoppel was applicable against the State.

New York State Court Finds No Grave Risk of Physical or Psychological Harm Under Hague Convention

In State ex rel Geiser v Valentine, 11/16/2007 NYLJ 30, (col. 3) (Sup. Ct, Richmond Co., Minardo, J.) Justice Minardo of the Richmond County Supreme Court found that the respondent had failed to meet that burden of establishing by clear and convincing evidence that the children faced a grave risk of physical or psychological harm or that returning them to Switzerland will place the children in an intolerable situation. Respondent had filed allegations of abuse and misconduct with the Office of the Protection of Adults and Minors, a Swiss child protection agency, which conducted a full and complete investigation. Before the Office of the Protection of Adults and Minors, as well as the police investigation, finished their reports and findings, the respondent left Switzerland with the children traveling to New York without informing the petitioner. The Court pointed out that soon after respondent left Switzerland, the Office of the Protection of Adults and Minors released their reports and findings on June 28, 2007. On July 5, 2007 the Swiss Police concluded their investigation and issued a report. Both the Police and the Office of Protection of Adults and Minors found no basis or merit to the allegations of abuse to the children. [Click here for expanded discussion]

Notice of Motion and Cross Motion Service Provisions of CPLR 2214 and 2215 Effective July 3, 2007 

Prior to July 3, 2007 CPLR 2214 (b) had provided that a demand could be made for the service of answering affidavits at least 7 days before the return date of the motion by serving the notice of motion at least 12 days before the return date and including such a demand in the notice of motion. At the same time CPLR 2215 provided that the notice of cross motion could be served 3 days in advance of the return date of the motion. It did not matter whether or not the additional four days time was given. Many attorneys would serve the notice of cross motion by mail, which would not always be received by their adversary before the return date of the motion. The party serving the cross-motion could mail it and the time between mailing and delivery was time lost to the party who had to respond.

CPLR 2214 (b) was amended effective July 3, 2007 to allow both parties to have adequate time to prepare their papers. It now provides that where a notice of motion is served at least 16 days before the return date of the motion it may demand that answering affidavits as well as any notice of cross-motion, with supporting papers, if any, be served at least 7 days before the return date of the motion. The provision relating to the notice of cross motion is new.

CPLR 2215 was also amended effective July 3, 2007 to require that any notice of cross-motion, with supporting papers, if any, must be served at least 7 days before the return date of the motion if a notice of motion served at least 16 days before the return date so demands. If the notice of cross motion and any supporting papers are served by mail they must be served three days earlier than as prescribed in CPLR 2103(b) and if they are served by overnight delivery service, they must be served one business day earlier than as prescribed in CPLR 2103 (b).
 

Hague Convention Decision By Third Circuit Construes Wishes of Child Exception Narrowly

In Yang v Tsui, 499 F.3d 259, 2007 WL 2377463 (C.A.3 (Pa.)) the Third Circuit construed the wishes of the child exception narrowly where it found that it was the passage of time during the years of wrongful retention and the litigation of the case that created the childs' desire to remain in the United States.

 

 

Hague Convention on the International Recovery of Child Support and Other Forms of Family Maintenance Adopted

On  November 23, 2007 the new Hague Convention on the International Recovery of Child Support and Other Forms of Family Maintenance and a Protocol on the Law Applicable to Maintenance Obligations were adopted by the Twenty-First Diplomatic Session of the Hague Conference on Private International Law. The major features of the new Maintenance Convention are a broadly based system for the recognition and enforcement of maintenance decisions made in Contracting States combined with expedited procedures; a system of co-operation between Central Authorities in each country to facilitate the processing of international applications; the provision for maintenance applicants of virtually cost-free services, including when needed free legal assistance in all the Contracting States; and an obligation to provide prompt and effective measures to enforce support orders coming from other countries. The Protocol contains rules which will guide judges on the question of the law to be applied in international maintenance cases. The new Maintenance Convention, which will enter into force after having received its second ratification, was signed by the United States that day.

 

 

The 2007 New York Law Reports Style Manual, Official Edition is now available online on the website of the State Reporter.  It is the official Style Manuel for New York attorneys and judges and is published by the New York State Law Reporting Bureau. The Manuel was prepared by Gary Spivey, the State Reporter, and Charles A. Ashe, William J. Hooks, Michael Moran, Katherine D. LaBoda, Chilton B. Latham, Kathleen B. Hughes, and Cynthia A. McCormick.

Note: The New York Law Reports Style Manuel is the only official citation authority in New York - the "Blue Book" is not authoritative and does not contain the correct method of citation for use in New York State Courts. The Manuel states: "Deviations from the rules stated in this Manual are permitted where application of a rule would adversely affect the clarity or readability of an opinion". It points out at the beginning that "New York decisions shall be cited from the official reports, if any. (CPLR 5529 [e].)"

Highlights of the 2007 Edition:

- A new rule (2.1 [a] [1]) requires that published New York decisions be cited by the case names specified in the newly published Official Case Name and Citation Locator (http://iapps.courts.state.ny.us/lawReporting/SearchCitation) and in the "Cite Title As" fields of the on-line Reports.

- The use of supra to indicate that an authority has been cited previously is no longer permitted with shortened citations (1.3 [b] [2]) and is no longer required for any subsequent reference (1.3 [c]).

- The placement of a comma between a citation signal and the citation is no longer permitted (1.4 [a]).

- The requirement to supply print page references where the electronic source cited does not provide them has been eliminated (1.5 [e]; 7.1 [a]).

- Formats for citing tabular or abstracted cases (table in print, full text on line) have been added (2.2 [b] [2]; 2.4 [a] [2]).

- The restrictions on citing Internet materials have been eased to permit Internet citations where the cited material is not readily available in another form (2.4 [a] [3]; 7.1 [c] [1]).

- A format for citing weblogs has been provided (7.1 [c] [4]).

- A new rule clarifies that the word "the" is not capitalized as part of the name of an entity (e.g., the New York Times) (10.4 [c]).

Other rules adopted in 2004:

- Permit the use of the citational footnote style. (1.2 [e])

- Make mandatory the formerly optional use of year of decision in full case citations (1.1 [a]).

- Require that an elision is to be indicated by three ellipsis points (. . .), not by asterisks (11.1 [c]). For simplicity, the use of three ellipsis points, rather than four points (three ellipsis points and a period), to indicate the omission of language between quoted sentences now is preferred (11.1 [c]).

 

Supreme Court Now Required to Appoint Counsel For Certain Indigent Litigants

Section 35 of the Judiciary Law was amended by Laws of 2006, Ch 538, effective August 16, 2006 to add a new subdivision 8 which requires supreme court to appoint counsel for indigent litigants in the same manner as family court is required to appoint such counsel. It provides that whenever supreme court shall exercise jurisdiction over a matter which the family court could have exercised jurisdiction had such action been commenced in family court, supreme court shall appoint counsel for indigent persons in the same manner as required by section 262 of the family court act. Family Court Act 262(a) provides which persons have the right to the assistance of counsel. When such person first appears in court, the judge must advise such person before proceeding that he or she has the right to be represented by counsel of his or her own choosing, of the right to have an adjournment to confer with counsel, and of the right to have counsel assigned by the court in any case where he or she is financially unable to obtain the same. Those persons who might appear before the Supreme Court, in a matrimonial action, for which the court is required to appoint counsel are the petitioner and the respondent in any proceeding under article eight of the act (family offenses); the parent of any child seeking custody or contesting the substantial infringement of his or her right to custody of such child, in any proceeding before the court in which the court has jurisdiction to determine such custody; any person in any proceeding before the court in which an order or other determination is being sought to hold such person in contempt of the court or in willful violation of aprevious order of the court, except for a contempt which may be punished summarily under section seven hundred fifty-five of the judiciary law; (viii) the respondent in any proceeding under article five of this act in relation to the establishment of paternity. Ed Note: The failure to advise a party of the right to counsel and to an adjournment to obtain counsel before the court made any orders has been held to be reversible error. See generally Perez v Arebalo, 13 AD3d 85, 786 NYS2d 441(1st Dept. 2004) Patricia L. v Steven N. 119 AD2d 221 (2d Dept. 1986); Mahoney v Doring 256 AD2d 1112 (4th Dept.,1998)

 

 

Reprehensible and Highly Offensive Behavior Is Not Necessarily Sufficient to Establish Cruelty

In Gross v Gross, 836 N.Y.S.2d 166 (1st Dept.,2007) the Appellate Division reversed on the law a judgment of divorce granted to the wife on the ground of cruel and inhuman treatment. The Court pointed out that plaintiff was asked at trial whether defendant had ever "physically force[d] himself on [her] sexually." In response, plaintiff testified that "I would have to say yes. It's only one time that, really where he hurt me." Apparently by way of explanation, plaintiff went on to state that defendant "[r]ammed [her] up against the wall" in the bathroom of their residence. Plaintiff did not elaborate about what she meant in stating that defendant had "force[d] himself on [her] sexually." The Court found that in its vagueness and generality, this testimony could include conduct ranging from the criminal (e.g., forcible rape) to the merely obnoxious. Plaintiff offered no evidence that she had sustained any injuries as a result of this incident and testified on cross-examination that she did not suffer any physical injuries as a result of the incident. Plaintiff also testified that defendant, on many occasions, "physically grabbed [her]." When asked to describe how defendant "grabbed" her, plaintiff stated: "[h]e'll grab me, he'll pull me down the hall, he'll block me so I can't leave the room, throw me on the bed, push me against the wall." No testimony was elicited from plaintiff that she sustained any injuries as a result of defendant's conduct. The Court held that reprehensible and highly offensive behavior is not necessarily sufficient to establish cruel-and-inhuman-treatment. Plaintiff's uncorroborated testimony regarding unwanted physical contact was vague and general, and no evidence was adduced from plaintiff regarding the effects, if any, of defendant's conduct on her physical or mental well-being. Plaintiff denied suffering any injuries as a result of the incident which occurred in the bathroom. She presented no evidence regarding the effects, if any, on her mental well-being of defendant's conduct in entering the bathroom of their residence while plaintiff was showering. While a party seeking a divorce on the ground of cruel and inhuman treatment is not required to produce medical evidence demonstrating the adverse effects of the defendant's behavior, the absence of such evidence may be relevant. The absence of medical evidence was particularly telling in light of plaintiff's failure to offer any other evidence tending to demonstrate that defendant's conduct was "harmful to the plaintiff's physical or mental health and makes cohabitation unsafe or improper" . The Court felt that it was left to speculate as to the effects, if any, of defendant's conduct on plaintiff's physical and mental well-being. Moreover, other evidence militated against the conclusion that plaintiff satisfied the substantial burden the law imposes upon her. The parties were married for 37 years, eight months at the time of trial, a marriage of long duration requiring a high degree of proof of cruel and inhuman treatment; the parties continued to reside together in the marital residence through the trial; and the parties were able to talk to each other in a civilized manner, have dinner together every night, go out for meals and to the movies and attend social functions. The evidence failed to demonstrate, with a high degree of proof, that the conduct of the defendant so endangers the physical or mental well being of the plaintiff as to render it unsafe or improper for the plaintiff to cohabit with the defendant".

 

No Authority to Issue Medical Execution in Absence of Determination That Health Insurance Benefits Are Available

In Matter of Oneida County Department of Social Services, on Behalf of Heidi S. V Paul S., --- N.Y.S.2d ----, 2007 WL 1652167 (N.Y.A.D. 4 Dept.) the Support Magistrate's order set forth that health insurance "is not available and affordable at this time." Petitioner filed an objection contending that the Family Court Act and the Domestic Relations Law both require support orders to contain language directing any legally responsible relative to provide health insurance benefits when such coverage becomes available if such coverage is not presently available. Family Court determined that, although petitioner was correct that the language with respect to health insurance benefits was mandatory, the decision whether benefits were available, i.e., reasonable in cost, should be made by the court, and the Support Magistrate had determined that health insurance benefits were not available. The court granted the objection to the extent of providing that the parties shall notify petitioner "in writing regarding any change in health insurance benefits available to them." The court also ordered that petitioner "shall not issue a medical execution without a determination made by a court of competent jurisdiction that the health insurance benefits are 'available' " within the meaning of Family Court Act s 416(d)(2). The Appellate Division rejected Petitioner’s argument that the court erred in limiting petitioner's authority to issue a medical execution pursuant to CPLR 5241(b)(2)(I). CPLR 5241(b)(2)(I) provides that, "[w]here the court orders the debtor to provide health insurance benefits for specified dependents, an execution for medical support enforcement may ... be issued by the support collection unit." Pursuant to Family Court Act 416(h), the court shall direct the legally responsible relative to enroll the eligible dependents to receive health insurance benefits "[w]here the court determines that health insurance benefits are available" ( 416[c], [d][2] ). " 'Available health insurance benefits' [are] any health insurance benefits that are reasonable in cost and that are reasonably accessible to the person on whose behalf the petition is brought" (416[d][2] ). The Support Magistrate determined that health insurance benefits were not available, and respondent was not ordered to provide such benefits. Thus, the prerequisite for the issuance of a medical execution, i.e., an order directing a debtor to provide health insurance benefits (see CPLR 5241[b][2][I] ), was not met. Therefore, the court properly determined that petitioner lacked authority pursuant to CPLR 5241(b)(2)(I) to issue a medical execution in the absence of a determination by the court that health insurance benefits are available.

 

Lump Sum Child Support Award of $92,480 Upheld Where Father Received Personal Injury Settlement

In Walker v Gilbert, --- N.Y.S.2d ----, 2007 WL 1216203 (N.Y.A.D. 3 Dept.) the Appellate Division pointed out that a lump-sum payment received by a parent in a tort action is not excluded from consideration in determining child support. One approach where a parent receives a nonrecurring large sum of money is to increase the weekly (or other periodic payment) support obligation by applying a reasonable rate of return to the funds received and imputing that amount as income. This may be a preferred approach in most situations involving a lump-sum settlement. However, directing the payment of a portion of the nonrecurring sum received is not precluded by the statute and may be appropriate under some circumstances. Family Court set forth in detail the compelling reasons for its approach in this case, (it awarded a lump sum of ($92,480 which was 17% of the net amount received as a personal injury award) including, among others, that "the child had extraordinary and heart wrenching multiple medical complications which are becoming more acute with time," "the [m]other has had to dedicate virtually her entire life to the care of the child," and "the [f]ather has totally abandoned his moral obligation and parental responsibilities owed to his son, leaving his son's complete care in the hands of the [m]other." Moreover, it was readily apparent to Family Court that respondent was rapidly dissipating the entire settlement without any regard to his child.

Valuation Methodology of Nurse Practitioner License Proper Even though Wife in Work Force Many Years

In Spreitzer v Spreitzer, --- N.Y.S.2d ----, 2007 WL 1439434 (N.Y.A.D. 2 Dept.) the parties were married in 1982. The defendant, who was a registered nurse, graduated from Pace University in 1994, and acquired a Masters of Science Degree and a nurse practitioner license. She held part-time position as a nurse practitioner in a private medical office since 1998. The Appellate Division held that the trial court properly calculated the enhanced earning capacity conferred by the defendant's degree and license by comparing the expected lifetime earnings of a registered nurse with the expected lifetime earnings of a licensed nurse practitioner, and reducing this sum to its present value. Although the defendant had already embarked on her career and acquired a history of actual earnings the court providently exercised its discretion in rejecting her testimony that she was unable to secure full-time employment. The trial court properly awarded the plaintiff 20% of the value of the degree and license constituting the enhanced earning capacity achieved by the defendant during the marriage, based upon his substantial economic as well as noneconomic contributions to the attainment of that enhanced earning capacity . The defendant's contention that the trial court erroneously imputed income of $78,000 to her for the purpose of calculating her child support obligation was without merit. In determining a party's child support obligation, "a court need not rely upon the party's account of his or her finances, but may impute income based upon the party's past income or demonstrated earning potential". Here, the court properly imputed an annual income to the defendant since the evidence at trial demonstrated that she was capable of earning $78,000 a year based on her degree, her nurse practitioner license, the facts adduced at trial, and the testimony of the expert who valued her degree and license.. The record supported the determination of the court that the defendant's earning potential exceeded her actual income reported on her 2004 income tax return.

 

Motion Granting Judgment Abandoned For Failure to Comply with 22 NYCRR 202.48. Law office failure does not constitute "good cause" for Delay .

In Farkas v Farkas, --- N.Y.S.2d ----, 2007 WL 1246924 (N.Y.A.D. 1 Dept.) the First Department reversed on the law an Order and judgment awarding plaintiff $750,000 with interest from August 6, 2003, vacated the judgment and dismissed as abandoned the claim underlying the judgment. It pointed out that the Court of Appeals has recently made it clear that "statutory time frames– like court-ordered time frames--are not options, they are requirements, to be taken seriously by the parties" (citing Miceli v State Farm Mut. Auto. Ins. Co., 3 NY3d 725, 726 [2004] [citation omitted], following Brill v. City of New York, 2 NY3d 648 [2004] ). Thus, where a statute or court rule prescribes a limited time frame in which to take a procedural step in litigation, and states that a party's failure to act within that time frame will be excused only upon a showing of "good cause," such a showing requires demonstrating, as the dissent put it, "more ... than [the] merit ... [of] the underlying application and a lack of prejudice to the other party." This principle applied in this case, in which plaintiff failed to comply with the 60-day time frame for the submission of a judgment to the court for signature (Uniform Rules for Trial Cts [22 NYCRR] 202.48[a], [b] ). Because plaintiff has failed to show good cause for her failure to comply with the time frame set forth in the Uniform Rules, it reversed and vacated the judgment. Although the order granting plaintiff's application for judgment was entered on October 17, 2000, it was not until May 2, 2005--four and a half years later--that plaintiff finally served defendant with a notice of settlement and a proposed judgment. Defendant opposed entry of the proposed judgment, arguing that it was untimely under 22 NYCRR 202.48(a), more than 60 days having passed since entry of the order directing settlement of the judgment. Therefore, defendant argued, the action should be deemed abandoned pursuant to 22 NYCRR 202.48(b), since plaintiff had not shown "good cause" for the delay. The court, without making any finding on the "good cause" issue, signed the judgment submitted by plaintiff without material amendment. Plaintiff's failure to comply with the clear mandate of the Uniform Rules was not justified either by the lack of prejudice to defendant from the late submission of the judgment or by the merit of the claim on which the judgment is based (cf. Brill, 2 NY3d at 652 ["good cause" for a late summary judgment motion under CPLR 3212(a) "requires a showing of good cause for the delay in making the motion--a satisfactory explanation for the untimeliness--rather than simply permitting meritorious, nonprejudicial filings, however tardy"] ). Plaintiff's failure to timely submit a judgment was simply an instance of law office failure. Plaintiff's counsel essentially admitted as much. In reply to defendant's opposition to the belated submission of the judgment, plaintiff's counsel concluded that "any failure to timely submit the Order [sic ] for settlement is based on an oversight by the firm filing." In view of Brill and its progeny law office failure clearly does not constitute "good cause" for delay within the meaning of 22 NYCRR 202.48(b). The more contemporary Brill and Miceli decisions indicate that courts are now expected to take a stricter approach to the enforcement of litigation deadlines. [Saxe, J.P. and Malone, J. dissented ]

 

 

Improper to Impute Income to Wife Out of Work Force For Extended Period of Time.

In Walter v Walter,--- N.Y.S.2d ----, 2007 WL 852120 (N.Y.A.D. 2 Dept.) the Appellate Division held that the Supreme Court improvidently exercised its discretion in confirming the referee's determination to limit the plaintiff's award of $4000 a month spousal maintenance to a period of five years, retroactive to the date of commencement of the action. The evidence presented at the hearing revealed that the plaintiff was the primary caretaker of the parties' three children, and that she stopped working shortly before the birth of the parties' second child in 1995 in order to become a stay-at-home mother. It extended the award of maintenance by an additional three years to afford the plaintiff, who had been out of the work force for an extended period of time, and was the primary caretaker of the parties' children, a sufficient opportunity to become self-supporting. The Appellate Division held that under the circumstances of this case, the court should not have confirmed the referee's determination to impute an annual income of $40,000 per year to the plaintiff for purposes of calculating child support under the CSSA. Although the court may impute income based upon a party's past income or demonstrated earning potential given the extended period of time during which the plaintiff has been out of the work force, and the necessity of affording her an additional period of time to become self-supporting, it was improper to impute income to her. It modified the judgment to increase the child support award from $2900 a month to $3,625 per month.

 

Denial of Fair Trial Warrants Reversal of Divorce Judgment

In Shagoury v Shagoury, --- N.Y.S.2d ----, 2007 WL 1016997 (N.Y.A.D. 2 Dept.) the Appellate Division reversed a judgment which, after a nonjury trial, inter alia, granted the plaintiff wife a divorce on the ground of cruel and inhuman treatment. A new trial was required because the trial court impermissibly and repeatedly precluded the husband from eliciting relevant testimony in his defense, as well as in support of the factual allegations contained in his counterclaim, and thereby deprived him of a fair trial.

 

Depositions Not Permitted in Custody Disputes and Deposition of Expert Not Favored.

In Nimkoff v Nimkoff, 36 A.D.3d 498, 830 N.Y.S.2d 27 (1st Dept.,2007) the Appellate Division, First Department, affirmed an order which granted motions by the court-appointed forensic evaluator Schaul and by plaintiff wife to vacate the defendant husband's notice of deposition and quash his subpoena for pre-trial disclosure by Schaul. It held that defendant was given ample opportunity to cross-examine the evaluator as to any bias in favor of mothers in custody proceedings. The circumstances did not suggest the need for a departure from the general rule that depositions are not permitted in custody disputes. Furthermore, deposing of expert witnesses is generally discouraged. The order directing production of Dr. Schaul's data file for review three business days prior to trial was appropriate.

Broad Disclosure Justified Where Closely Held Corporation Owned by Spouse. Special Circumstance Rule Still Applicable to Non-Party Depositions.

In Reich v Reich, 36 A.D.3d 506, 830 N.Y.S.2d 29 the Appellate Division held that the documents and records sought by defendant wife from Hercules Corp. were appropriate to a characterization and valuation of Hercules, a closely held corporation in which plaintiff husband was a 2.5% shareholder. Under the Equitable Distribution Law, broad pretrial disclosure which enables both spouses to obtain necessary information regarding the value and nature of the marital assets is critical if the trial court is to properly distribute the marital assets. This searching exploration is more than justified in the case of close corporations, the ownership of which is in the hands of a small number of stockholders and for which there is little objective evidence of fair market value. Defendant wife will have to bear the costs of any document production. The Appellate Division modified to quash the notice of deposition served upon Alfred May. Defendant had not shown that the information sought from him was not obtainable from other sources (citing Dioguardi v. St. John's Riverside Hosp., 144 A.D.2d 333, 533 N.Y.S.2d 915 [1988] ), particularly since appellants had evidently agreed that they would make him available for deposition.

 

Income Imputed to Husband Who Manipulated Corporate Expenses

In Yarinsky v Yarinsky --- N.Y.S.2d ----, 2007 WL 108475 (N.Y.A.D. 3 Dept.) the Appellate Division held that Courts have considerable discretion in fashioning a child support award; when assessing a parent's income from which to determine his or her child support obligation, a court should consider factors such as the parent's "gross (total) income as ... reported in the most recent federal income tax return", as well as additional income from sources other than employment and a parent's past income . Further, a court may impute income based upon a parent's prior employment experience and future earning capacity in light of his or her educational background. Notably, when a party's or an expert's account of his or her finances is not believable, a court is justified in finding an income higher than that claimed . Upon its review of the record the Appellate Division concluded that the Support Magistrate acted within his discretion in focusing on the 2003 federal tax returns of the parties and the husbands solely owned subchapter S corporation, as they were the most recent at the time of the hearing. Further, each item of income attributed to the husband for child support purposes--which totaled$189,547-- was supported in the record. It was clear that--in anticipation of an eventual full plenary hearing on child support--the husband made a number of financial decisions which effectively reduced the amount of the corporate nonemployment income received by him in 2003; the most glaring were his December 2003 decisions to purchase a new corporate vehicle for his personal use ($31,356) and to upgrade his office computer system ($15,070.16) thereby reducing the 2003 excess corporate profit--payable as income to him as sole shareholder of the corporation--by $46,426. Accordingly, it imputed $40,426 in additional 2003 income to the husband's share of the combined parental income.

 

Oral Motion Denies Notice and Opportunity to Be Heard. Contempt Requires Compliance with Judiciary Law

In Xand Corporation V Reliable Systems Alternatives Corporation 35 A.D.3d 849, 827 N.Y.S.2d 269 (2d Dept.,2006) an action to recover damages for fraud in the inducement, the Supreme Court granted the defendant's oral application to hold the plaintiff in contempt of court and to strike the complaint for its failure to comply with a prior court order. The Appellate Division reversed holding that defendant's oral application to hold the plaintiff in contempt of court did not satisfy the statutory requirements for a contempt application. Pursuant to Judiciary Law 756, a contempt application must be in writing, must be made upon at least 10 days notice, and must contain on its face the statutory warning that "failure to appear in court may result in ... immediate arrest and imprisonment for contempt of court" . Since the defendant's oral application failed to comply with any of these procedural safeguards, the Supreme Court erred when it punished the plaintiff for contempt for failing to comply with its prior order. Furthermore, under the circumstances of this case, defendant's oral application to strike the complaint based upon the plaintiff's failure to comply with court-ordered discovery should have been denied in the absence of notice and an opportunity to be heard.

 

Court of Appeals Holds New York Grandparent Visitation Law is Constitutional

In the Matter of E.S. (Anonymous), v. P.D. (Anonymous), the Court of Appeals, in an opinion by Judge Read, held that section 72(1) of the Domestic Relations Law is constitutional in view of the United States Supreme Court's decision in Troxel v Granville (530 US 57 [2000]), both on its face and as applied.
A.D.'s mother E.S. (grandmother), who lived in East Hampton, Long Island, was asked to move into the marital home in Huntington to care for her terminally ill daughter and the child. The Grandmother cleaned the house, shopped, cooked household meals and looked after the child when A.D.'s illness prevented her from doing so.
After A.D.'s death in March 1998, father invited the grandmother to stay on to help out with the then four-year-old child's care and household duties. They lived together amicably in the Huntington home for the ensuing three and one-half years. During that time, grandmother comforted, supported and cared for the motherless child. She got him ready for school, put him to bed, read with him, helped him with his homework, cooked his meals, laundered his clothes and drove him to school and to doctor's appointments and various activities, including gym class, karate class, bowling, soccer, Little League baseball and swimming class. She arranged and transported him to away-from-home or supervised at-home play dates; she took him to the public library and introduced him to the game of chess. By the fall of 2001, the relationship between grandmother and father had begun to sour. On February 24, 2002 the father demanded that grandmother move out of the home immediately. From April through December 2002, the father allowed sporadic visits, which were limited in length and tightly supervised, and occasional telephone calls. In January 2003, grandmother, who was 78 years old at the time, commenced the proceeding pursuant to Domestic Relations Law § 72 and Family Court Act § 651 for an order granting reasonable visitation with the child, who was then nine years old. The Father opposed the grandmother's request, and cross-moved for an order prohibiting grandmother from any contact whatsoever with the child.
Supreme Court granted judgment to grandmother, and ordered visitation according to a detailed schedule. Supreme Court concluded that "[a]lthough mindful of [father]'s right to rear [the child] as he sees fit, and of his stated concern that [grandmother] undermines his parental authority, the Court finds that he has failed to present any credible evidence warranting either the termination of the relationship between [grandmother] and [the child] or the imposition of restrictions on the right of visitation. Instead, the evidence in the record establishes the existence of a very close, loving relationship between [grandmother] and [the child], and that [the child]'s best interest is served by granting [grandmother] regular, unfettered visitation." The Appellate Division affirmed Supreme Court's judgment, but modified certain terms of the visitation schedule in deference to father's wishes, relying on Troxel. The Appellate Division rejected the father's argument that Supreme Court abused its discretion in awarding visitation to grandmother.
The Court of Appeals affirmed. Judge Read noted that Section 72(1) derogates from the common-law rule that "grandparents [have] no standing to assert rights of visitation against a custodial parent". The statute "rests on the humanitarian concern that [v]isits with a grandparent are often a precious part of a child's experience and there are benefits which devolve upon the grandchild . . . which he cannot derive from any other relationship" (id. at 181 [internal quotation marks and citations omitted]). Section 72(1) "does not create an absolute or automatic right of visitation. Instead, the statute provides a procedural mechanism for grandparents to acquire standing to seek visitation with a minor grandchild". When grandparents seek visitation under section 72(1), the court must undertake a two-part inquiry. "First, [the court] must find standing based on death or equitable circumstances"; and "[i]f [the court] concludes that the grandparents have established the right to be heard, then it must determine if visitation is in the best interest of the grandchild" (Matter of Emanuel S., 78 NY2d at 181). She cautioned that the courts should not lightly intrude on the family relationship against a fit parent's wishes. The presumption that a fit parent's decisions are in the child's best interests is a strong one. And while the problems created by parent-grandparent antagonism cannot be ignored, an acrimonious relationship is generally not sufficient cause to deny visitation.
Here, the grandmother had automatic standing under section 72(1) on account of A.D.'s death. Record evidence supported the determination of the courts below that visitation between grandmother and the child is in the child's best interest. The Appellate Division affirmed the trial court's findings of fact, and the Court of Appeals could not revisit them. In light of these factual findings, there was no reason to disturb the best-interest determination in this case.
The Father contended that Domestic Relations Law § 72(1) was facially unconstitutional in light of Troxel. Judge Read noted that the Washington statute at issue in Troxel permitted "'[a]ny person' to petition [the trial court] for visitation rights 'at any time,' and authorize[d] that court to grant such visitation rights whenever 'visitation may serve the best interest of the child'". The problem in Troxel was therefore not that the trial court intervened, but that it failed to employ "the traditional presumption that a fit parent will act in the best interest of his or her child" when it did. The trial court effectively applied a presumption in favor of grandparent visitation, placing on the parent "the burden of disproving that visitation would be in the best interest" of her children. Reasoning from Troxel, Judge Read court that section 72(1) was facially constitutional. Section 72(1) "can be, and has been, interpreted to accord deference to a parent's decision, although the statute itself does not specifically require such deference. Further, [section 72(1)] is drafted much more narrowly than the Washington statute [considered in Troxel]. If the United States Supreme Court did not declare the 'breathtakingly broad' Washington statute to be facially invalid, then certainly the more narrowly drafted New York statute is not unconstitutional on its face. In fact, the Court indicated that it would be hesitant to hold specific nonparental visitation statutes unconstitutional per se because 'much state-court adjudication in this context occurs on a case-by-case basis.' Troxel does not prohibit judicial intervention when a fit parent refuses visitation, but only requires that a court accord 'some special weight to the parent's own determination' when applying a nonparental visitation statute". (quoting Justice Altman in Matter of Hertz v Hertz, 291 AD2d 91, 94 [2d Dept 2002]).
The father also argued that section 72(1) was unconstitutionally applied in this case. The Court of Appeals disagreed. Unlike Troxel, the trial court here did not presuppose that grandparent visitation was warranted as the jumping-off point for factfinding and best-interest analysis. Instead, the court, emphasizing that it was "mindful" of father's parental prerogatives, employed the strong presumption that the parent's wishes represent the child's best interests, as our statute requires. While this presumption creates a high hurdle, the grandmother in this case surmounted it: from the time the child was almost four until he was seven, the grandmother was his surrogate, live-in mother. The court then properly went on to consider all of the many circumstances bearing upon whether it was in the child's best interest for his relationship with grandmother to continue -- e.g., the reasonableness of father's objections to grandmother's access to the child, her caregiving skills and attitude toward father, the law guardian's assessment, the child's wishes -- before making a judgment granting visitation.

 

New Trial Granted on Issues of Maintenance And Child Support Where Husband Had Heart Attack After the Decision

In Opperisano v Opperisano, --- N.Y.S.2d ----, 2006 WL 3734238 (N.Y.A.D. 2 Dept.) Supreme Court awarded the plaintiff maintenance of $65 per week for five years, granted the plaintiff a right of first refusal on the sale of the marital home at the valuation appraised as of August 29, 2003, awarded the plaintiff $2,860 in maintenance arrears, $13,395.23 in expenses on the marital home, and $7,344 in child support arrears and directed that the defendant pay the plaintiff one half of her credit card debt of $24,000 and denied the defendants motion for a new trial. The Appellate Division reversed the judgment insofar as appealed from, on the law, and granted the defendants motion pursuant to CPLR 4404(b) for a new trial and the matter was remitted to the Supreme Court for a new trial and thereafter for a new determination. It held that a court may modify a prior order or judgment of child support or maintenance payments upon a showing of "a substantial change in circumstance. In his affidavit and supporting papers filed on his motion, in effect, for a new trial, the husband made a prima facie showing that, after the first trial, he had been forced to retire and had been put on disability because of a heart attack and continuing heart disease and, consequently, had suffered a significant loss of income. This was sufficient to warrant a new trial and a new determination on the issues of maintenance and child support.

New Attorney Advertising and Certification Rules Effective February 1, 2007

The presiding justices of the Appellate Divisions promulgated new rules regarding attorney advertising which took effect on February 1 , 2007. See Court Notes below for more information.        

Court of Appeals Holds that McSparron Does Not Extend to Tangible Income Producing Assets

In Keane v Keane , 12/22/2006 NYLJ 22, (col. 5) the Court of Appeals held that the principal enunciated in Grunfeld v. Grunfeld (94 NY2d 696 [2000]) and McSparron v. McSparron (87 NY2d 275 [1995], that in divorce actions a court should not twice count the income associated with a professional license, an intangible asset, when making distributive and maintenance awards, does not extend to the distribution of a tangible, income-producing asset (here, a parcel of land leased to a car repair shop which provided rental income) and the subsequent award of maintenance from income deriving from that asset.

Absence of New Retainer Agreement upon Substitution after Dissolution of Partnership Did Not Constitute Noncompliance with 22 NYCRR 1400.3 in Light of Ratification of Retainer Agreement

In Gross v Gross--- N.Y.S.2d ----, 2006 WL 3803316 (N.Y.A.D. 2 Dept.) the plaintiff commenced an action for divorce through her former attorney, Kim Brennan Joyce, who, at that time, was a named partner a law firm which had since dissolved. After the action was submitted to the Supreme Court for an inquest a stipulation was incorporated but not merged into the judgment.. The plaintiff agreed, pursuant to the stipulation, that she was responsible for her own attorney's fees and that: "in the event any outstanding legal fees remain on [plaintiff's] behalf to Kim Brennan Joyce, Esq., same shall be satisfied from her proceeds from the sale of her one-half equity interest in the marital residence at the time of closing. In the event there is a dispute as to any counsel fees outstanding, an amount sufficient to satisfy Kim Brennan Joyce, Esq.'s final bill shall be held by her in escrow pending a resolution of same ". In accordance with the stipulation at the closing on the sale of the marital residence, the parties' attorneys executed an agreement pursuant to which each attorney held in escrow the sum of $140,713.05, representing 50% of the net proceeds of the sale of the marital residence, "without disbursement until further agreement of the parties or order of the court directing same ". Joyce moved to be relieved as counsel for the plaintiff, and to retain the sum of $53,191.61 in escrow subject to determination of the fee dispute committee or further court order. Joyce submitted her own affirmation in which she averred that she had sent the plaintiff bills for services rendered in the requisite time-frames under the rules governing matrimonial actions and that the plaintiff never disputed those bills, but rather, repeatedly assured Joyce that the bills would be paid from the proceeds of the action. Joyce further averred that the closing proceeds were held in escrow "due to failure of the parties to agree on the disbursement of proceeds." The court granted the motion to the extent of permitting Joyce to retain the sum of $53,191.61 in her escrow account subject to a determination by the fee dispute committee, and directing her to release the remaining sum held in escrow to the plaintiff. The Appellate Division affirmed. It held that Supreme Court properly determined that Joyce complied with the requirements of 22 NYCRR 1400.3 and 1400.5, It found that the plaintiff and the partnership entered into a retainer agreement, which was executed by the plaintiff and Joyce, on behalf of the partnership. Under the circumstances of this case, the absence of the execution and filing of a new retainer agreement upon her substitution as the attorney-of-record after the dissolution of the partnership did not constitute noncompliance with 22 NYCRR 1400.3 . The retainer agreement fully complied with the requirements of 22 NYCRR 1400.3. Joyce executed it for the partnership and made appearances for the plaintiff. The Appellate Division held that the plaintiff thereby ratified both Joyce's representation of her after the substitution and that the terms of the original retainer agreement were binding on them.

No Counsel Fee Award Without New Retainer For Post Judgment Services

In Sherman v Sherman, --- N.Y.S.2d ----, 2006 WL 3377483 (N.Y.A.D. 2 Dept.) the Appellate Division affirmed an order which denied the former wife’s motion for an attorney fee for post judgment services. It held that absent substantial compliance with 22 NYCRR 1400.3, which requires the execution and filing of a retainer agreement setting forth, inter alia, the terms of compensation and the nature of services to be rendered, an attorney may not recover a fee from an adversary spouse. By its own terms the retainer agreement between the wife and her attorney terminated upon entry of the judgment of divorce. The filing of a new retainer agreement in support of the subsequent motion for a post judgment attorney's fee, which purportedly ratified the former agreement, did not amount to substantial compliance with the matrimonial rules.

Family Court Lacks Subject Matter Jurisdiction to Set Aside Child Support Agreement Incorporated in Divorce Judgment

In Savini v Burgaleta, --- N.Y.S.2d ----, 2006 WL 3378238 (N.Y.A.D. 2 Dept.) the parties 1996 stipulation, was incorporated in and survived their judgment of divorce, and provided, that the father would "pay to the [mother] as and for child support 29 percent of his gross salary as defined under the Child Support Standards Act on a weekly basis calculated on actual income." In a later agreement dated April 1997, which was not incorporated into the judgment, the mother allegedly agreed, to accept the sum of $200 per week from the father as child support and not to commence any proceeding to recover the difference between that amount and the percentage of gross salary specified in the prior stipulation. In 2004, the mother commenced a family court proceeding to enforce the child support provisions. The father moved in Supreme Court to have the petition transferred to it and to have it dismissed based on the terms April 1997 agreement. Supreme Court determined that the April 19, 1997, agreement was not a valid modification agreement because it failed to comply with the provisions of DRL 240(1- b)(h) and denied the motion to transfer. Subsequently, the Support Magistrate, sua sponte, determined that "the prior Judgment of Divorce and the stipulations did not comply with the Child Support Standards Act" and considered the issue of child support de novo. The Appellate Division held that Family Court was without subject matter jurisdiction, in effect, to vacate as illegal so much of the judgment of divorce as directed the father to pay child support and, thereafter, to determine the issue of child support de novo. Family court is a court of limited jurisdiction. New York Constitution, article 6, §13(c) provides that the Family Court is vested with limited jurisdiction "to determine, with the same powers possessed by the [S]upreme [C]ourt, the following matters when referred to the [F]amily [C]ourt from the [S]upreme [C]ourt: ... in actions and proceedings for ... divorce, ... applications to fix temporary or permanent support ... or applications to enforce judgments and orders of support". Nowhere in the Constitution, in the Family Court Act, or in the judgment of divorce itself, is the Family Court empowered, in effect, to invalidate a stipulation incorporated into the judgment of divorce entered by the Supreme Court. Had either party questioned the legality of the stipulation, the issue should have been determined by the Supreme Court, which had issued the judgment in which the stipulation was incorporated.

Marital Assets Awarded Wife in Pre-Petition Divorce Action Where Judgment Not Entered are Assets of Bankrupt Estate

In Musso v Ostashko, --- F.3d ----, 2006 WL 3190285 (C.A.2 (N.Y.)) the Chapter 7 trustee filed an adversary complaint, seeking to avoid the debtor's former wife's interest in marital property and to have the property turned over to him. The former wife filed a counterclaim, asserting that the property was not property of the debtor's bankruptcy estate. The Bankruptcy Court denied the former wife's motion for summary judgment. The District Court, 333 B.R. 625, reversed and directed the bankruptcy court to enter judgment in favor of former wife. The Second Circuit Court of Appeals reversed. It held that under New York law, the marital assets in question, which were awarded to the debtor's wife in a pre-petition state-court matrimonial proceeding whose judgment was not docketed until after the filing of debtor's bankruptcy petition, were the property of debtor's bankruptcy estate. The bankruptcy court had ruled that, in New York, an equitable right to marital property does not arise until entry of the judgment awarding equitable distribution and, thus, the property must be included in the estate. On appeal, the district court reversed, finding that the entry of the state court judgment is "ministerial" and, thus, the rights of the wife, Tanya Ostashko, vested upon rendering of the state court's "Decision After Inquest." The Court of Appeals, in vacating the decision of the district court held that:" Four relevant premises require this result. First, under New York law an equitable distribution award is a remedy, and the enforcement of that remedy is no different than the enforcement of any other judgment. Second, New York adheres to the bright line rule that the priority of judgment creditors is determined on the basis of the order in which judgments are docketed or executed. Third, 11 U.S.C. 544-the so-called "strong arm" provision of the Bankruptcy Code-gives the bankruptcy trustee the rights of a hypothetical perfected judgment lien creditor as of the petition date. Finally, while the Decision After Inquest determined the rights to the marital assets as between husband and wife, the decision did not purport to determine the rights to the assets as between Tanya Ostashko and all other judgment lien creditors. Based upon these considerations, and the undisputed fact that the matrimonial judgment was docketed after the filing of the Chapter 7 petition, we hold that the marital assets are part of the bankruptcy estate and subject to distribution in due course by the bankruptcy court."

 

Distributive Award Disguised As Maintenance Dischargeable In Bankruptcy

In Re Duffy v Taback 2006 WL 1540542 (S.D.N.Y.) during the course of the marriage, Duffy obtained his medical degree. In 1994 Appellant Taback commenced an action for divorce and it came on for trial before the Honorable Fred Shapiro on June 27, 1997. On that date, with the participation of Justice Shapiro, the parties stipulated to a settlement of what the Bankruptcy Court found to be the single issue on which they went to trial, that of the equitable distribution of the value of the medical degree. The judgment of divorce stated in relevant part: ADJUDGED AND DECREED that the Defendant [Duffy] shall pay monthly spousal maintenance to the Plaintiff [Taback] commencing July 1, 1997 in the sum of $2,000 per month payable in monthly installments which shall be made on the first day of each month for the term of ten (10) consecutive years, which payment shall be non-dischargeable in bankruptcy and paid unconditionally to the Wife irrespective of her cohabitation or remarriage. In May 2002, Duffy admitted to several professional misconduct allegations and relinquished his license to practice medicine. The Bankruptcy Court held that the provision in the divorce judgment for ten-year payments designated "spousal maintenance" aggregating $240,000 constituted the settlement of a dispute between the parties concerning solely equitable distribution of the debtor's property interest in his medical license and practice. Since the dispute which was tried in the state court on June 27, 1997 concerned only equitable distribution, and since Taback made no claim for alimony/maintenance at or prior to the trial in the divorce action the liability to pay $240,000 over ten years although designated as "spousal maintenance" was not "actually in the nature of alimony, maintenance, or support" .. [and accordingly] cannot be deemed alimony, maintenance or support within the scope of Section 523(a)(5). The Court rejected Appellants argument that according to Zaera v. Raff, 93 B.R. 41 (Bankr.S.D.N.Y.1988)  the monies at issue were, as a matter of law, in the nature of alimony and therefore not dischargeable under Section 523(a)(5) of the Bankruptcy Code. In Raff, the Bankruptcy Court relied on O'Brien v. O'Brien, 66 N.Y.2d 576, 584 (1985), and held that an award of a percentage of the value of a medical degree was in the nature of alimony and support and was non-dischargeable. To the extent that Zaera v. Raff, which held that a distributive award of the value of debtor's medical degree acquired during marriage is in the nature of non-dischargeable alimony and not marital property, intended to establish a bright line rule to that effect, the District Court declined to follow Raff. The Court did not find an intended bright line rule in Raff, but were it so to find, it would nevertheless not be bound thereby. The Bankruptcy Court found that on June 17, 1997, the parties settled their only actually remaining dispute pending before the state court, which was over the equitable distribution of Duffy's property interest in his medical degree, and they did not settle a claim over alimony or maintenance, as such a claim was never made. It found that the parties treated the distribution as spousal maintenance at the suggestion of Justice Shapiro in order to settle Taback's claim for equitable distribution in a way that Duffy's net cost would be reduced by way of federal income tax deductions. Despite the tax consequences reflecting alimony in this case,the term making the payments unconditional despite Taback's remarriage or cohabitation flies in the face of an intent to award alimony support.

 

 

Provision for Own Attorneys Fees For Collecting Law Firms Attorneys Fees Void

In Ween v Dow, (2006 NY Slip Op 07227) the Appellate Division, First Department, held that a provision in a retainer agreement, which holds the client liable for attorneys' fees incurred in the collection of fees generated under the retainer agreement, is void as against public policy. The retainer agreement provided, in part: "If client fails to pay for charges due under this agreement and the law firm takes legal action and is awarded such charges, client shall owe to law firm costs, expenses and attorneys' fees (including but not limited to the reasonable value of the law firm's own work) attributable to law firm's collection proceedings and/or action." The Court noted that even in the absence of fraud or undue influence, an agreement to pay a legal fee may be invalid if it appears that the attorney got the better of the bargain, unless he can show that the client was fully aware of the consequences and that there was no exploitation of the client's confidence in the attorney. It found that the very nature of the provision, which permits the recovery of attorneys' fees by the attorney should he prevail in a collection action, without a reciprocal allowance for attorneys' fees should the client prevail, to be fundamentally unfair and unreasonable. Aside from its lack of mutuality, the clause, even if not so designed, had the distinct potential for silencing a client's complaint about fees for fear of retaliation for the nonpayment of even unreasonable fees . For that reason the provision was unenforceable.

Stipulation Does Not Foreclose Inquiry into Propriety of Attorneys' fee

In Campion v Campion, --- N.Y.S.2d ----, 2006 WL 2615131 (N.Y.A.D. 2 Dept.) the Appellate Division reversed an order which granted the motion of the former attorney for the plaintiff, to enter a money judgment in the sum of $31,615.40 against the plaintiff, and denied the plaintiff's cross motion to vacate the portion of a stipulation of settlement between the parties requiring her to pay an attorney's fee to him. In the course of negotiating the settlement of this matrimonial action, the attorney for the plaintiff-client obtained the client's consent to insert into the stipulation of settlement between the parties a provision requiring her to pay his fee, in the amount of $31,615.40, from certain marital property that she was to receive in equitable distribution. The stipulation was subsequently "so ordered" and incorporated, without being merged, into the judgment of divorce. The client subsequently refused to comply with the terms of the stipulation of settlement. The attorney then moved in the action to hold the client in contempt of court for her noncompliance with the stipulation of settlement or, among other things, for leave to enter a money judgment against the client. The client opposed the motion on the ground that the time for which she was charged was excessive. At the same time, she commenced a plenary action in the Supreme Court to set aside the fee provision in the stipulation of settlement. The Appellate Division held that Supreme Court erred in granting the motion for leave to enter a money judgment without considering the client's cross motion to vacate the portion of the stipulation of settlement requiring her to pay an attorney's fee. By moving in the matrimonial action for leave to enter a money judgment upon the ground that the client had defaulted, the attorney necessarily invoked the summary procedure established by Domestic Relations Law 244 for the enforcement of matrimonial obligations. Under the terms of that provision, a party against whom enforcement of an obligation other than child support is sought may seek relief from the obligation upon showing good cause. Here, such good cause was established, prima facie, by the attorney-client relationship between the attorney and the client at the time the cliententered into the fee stipulation. "[I]t is well settled that the courts possess the traditional authority 'to supervise the charging of fees for legal services' pursuant to their 'inherent and statutory power to regulate the practice of law' " The existence of the stipulation did not foreclose the court from inquiring into the propriety of an attorneys' fee, even in the absence of undue influence or fraud.

Net Worth Statement Required Before Court Can Apportion Law Guardian Fees

In Frost v Goldberg, 818 N.Y.S.2d 533 (2d Dept.,2006) the Appellate Division held that Supreme Court improvidently exercised its discretion in confirming that portion of the Judicial Hearing Officer's report which recommended that the plaintiff reimburse the defendant the sum of $12,400 in fees paid by the defendant to the Law Guardian. Although such fees and related expenses are entrusted to the sound discretion of the court, they are nonetheless to be controlled by the equities of the case and the financial circumstances of the parties. The Judicial Hearing Officer failed to consider the financial circumstances of the parties. The defendant failed to file a current statement of net worth with his cross motion, as required by 22 NYCRR 202.16(k)(2). In addition, the plaintiff did not file a statement of net worth with the court. The matter was remitted to Supreme Court, for a hearing to consider the parties' relative financial positions, and for a new determination on the issue of reimbursement of fees paid to the Law Guardian . It directed that the new determination should be made only after receipt of a statement of net worth from both parties.

Waiver of Right to Seek Attorney Fee in Prenuptial Agreement May Be Void

In Kessler v. Kessler, 2004-04773, an action for a divorce and ancillary relief, the wife sought to rescind or reform a prenuptial agreement on the grounds, inter alia, that she entered it under duress and that it was unconscionable. Supreme Court denied her request but held that the portion of the agreement waiving the right to seek an award of attorney's fees for the equitable distribution portion of their divorce case was unconscionable and unenforceable in light of Domestic Relations Law 237(a). The Second Department affirmed, holding that DRL 237 "embodies a public policy determination by the Legislature that matrimonial matters are best resolved by parties operating on a level playing field". However, it indicated that "not every agreement waiving the right to seek an award of an attorney's fee should be set aside. Rather, careful and individualized scrutiny is called for. The determination as to whether or not a provision waiving the right to seek an award of an attorney's fee is enforceable must be made on a case-by-case basis after weighing the competing public policy interests in light of all relevant facts and circumstances both at the time the agreement was entered and at the time it is to be enforced. If, upon such an inquiry, the court determines that enforcement of the provision would preclude the non-monied spouse from carrying on or defending a matrimonial action or proceeding as justice requires, the provision may be held unenforceable. Also relevant to such a determination is the conduct of the parties over the course of the matrimonial action. Such a determination is frequently best made at the conclusion of the action. However, because an attorney's fee is authorized when needed to carry on or defend an action, it may be necessary to make such a determination at an earlier point in the litigation." To the extent that such an award would otherwise be subject to the waiver contained in the prenuptial agreement, the Supreme Court, after careful and individualized scrutiny of the need for the same, may award the wife an attorney's fee as justice requires to enable her to carry on or defend issues of equitable distribution. Here, the agreement provided that "each party shall have no right or claim against the other for support, alimony, attorney fees or costs." The Appellate Division found that there was a great disparity in the parties income and assets and the prenuptial agreement reflected no consideration given to the specific facts and circumstances of the parties as they related to an award of an attorney's fee. Although the wife came into the marriage with minimal assets compared to the husband, the agreement provided for a blanket waiver of the right to seek an award of an attorney's fee, regardless of the length of the marriage or what occurred therein. The agreement did not provide for any consideration to be given "at the time of the matrimonial action to the various issues relevant to an award of an attorney's fee, including, inter alia, the quantity and complexity of the issues to be litigated, and the relative means of the parties to do so". The court noted that matters related to child support and child custody were not controlled by the agreement, nor were the fees incurred by the wife in her unsuccessful effort to rescind or reform the agreement, which are not compensable pursuant to DRL 237. The court found that the matrimonial scales were skewed in favor of the husband's heavier wallet. The wealthier spouse should not be permitted, by the same agreement, to both opt out of the statutory scheme concerning an award of an attorney's fee and prevent an effective assessment of how important an award of an attorney's fee may be. Moreover, whether or not either party here has improperly prolonged the litigation, or created needless litigation, etc., should also be considered by the court in determining the amount, if any, of an award of an attorney's fee to the wife.

Improper to Alter Custodial Arrangement Automatically upon Happening of Specified Future Event

In Brzozowski v Brzozowski, --- N.Y.S.2d ----, 2006 WL 1643384 (N.Y.A.D. 2 Dept.) the mother appealed from an order of the Family Court, which , after a hearing, denied her petition to relocate with the child to Westport, Connecticut, and directed that in the event of her relocation with the child to Westport, Connecticut, the judgment of divorce and stipulation of settlement shall be modified so that physical custody is transferred to the father. The Appellate Division modified the order and vacated the direction that "[in] the event the mother relocates to Westport, Connecticut, then [physical] custody of the child .. shall belong with the father, forthwith." It held that this direction, while possibly never taking effect, impermissibly purported to alter the parties' custodial arrangement automatically upon the happening of a specified future event without taking into account the child's best interests at that time.

Contingency Fees Barred in Any Matrimonial Action

In Ross v Delorenzo --- N.Y.S.2d ----, 2006 WL 1009642 (N.Y.A.D. 2 Dept.) the defendant hired the plaintiff to represent her in a divorce action and signed an hourly fee agreement. After discussing the case, the plaintiff concluded that, based on the short duration and alienated nature of the marriage and the dearth of marital property, the defendant was only entitled to nominal maintenance and was not entitled to equitable distribution. Based on the parties past business relationship the plaintiff decided to also interpose claims alleging an oral partnership and constructive trust and the parties signed a contingency fee agreement whereby the plaintiff would recover one third of all sums recovered on the partnership and constructive trust claims. The parties later executed a new hourly fee agreement that increased the plaintiff's hourly rate. According to the plaintiff, at some point during the course of the litigation he and the defendant agreed that he would accept $300,000 in full satisfaction of his fees if the matter settled for less than $1.8 million. After the matter was settled the parties stipulated to and the defendant thereafter remitted the sum of $200,000 to the plaintiff. When the plaintiff reminded the defendant that he was entitled to an additional $100,000, but the defendant refused to pay it, and the suit ensued. The Appellate Division held that an attorney may not, in the context of a suit which includes both matrimonial and nonmatrimonial causes of action, enter into a contingency fee agreement whereby he becomes entitled to a percentage of so much of the proceeds of the litigation as are derived from the nonmatrimonial causes of action. The court noted that while an attorney may charge a contingency fee to prosecute nonmatrimonial claims generally, "[a] lawyer shall not enter into an arrangement for, charge or collect ... any fee in a domestic relations matter, the payment or amount of which is contingent upon the securing of a divorce or in any way determined by reference to the amount of maintenance, support, equitable distribution or property settlement" (citing, inter alia, 22 NYCRR 1200.11[c][2][i]; see 22 NYCRR 1400.1 and 1400.2.) "The rule against contingent fees in domestic relations cases in New York is deep seated and well established. The policy reasons include a belief that this kind of fee might induce lawyers to discourage reconciliation and encourage bitter and wounding court battles. Another often expressed policy reason to preclude contingent fees in matrimonial actions is that they are not necessary, since the court may award attorney's fees to a nonmonied spouse and thus any party should be able to retain counsel" . The Court was aware of rulings from other states holding that such fees do not violate the public policy against contingency fees in domestic relations matters because they are not contingent upon the securing of "alimony or support or property settlement in lieu thereof". However, New York's prohibition on contingency fees in domestic relations matters is very broad, and does not distinguish between property settlements made in lieu of maintenance, support, or equitable distribution and property settlements based on nonmatrimonial property claims (see 22 NYCRR 1200.11[c][2][i]; see also 22 NYCRR 1400.1 and 1400.2). And, allowing contingency fees for nonmatrimonial claims interposed with matrimonial claims would contravene the important policy concerns that inform the general prohibition. Such a rule would create an incentive for attorneys to characterize most, if not all, of the proceeds of a settlement as deriving from the nonmatrimonial claims in order to maximize the value of, and therefore the contingency fee derived from, those claims. The result would be to diminish the amount of property available for maintenance, support, and equitable distribution. The Second Department concluded that the better rule is to prohibit contingency fees in the context of any action containing matrimonial claims.

 

Hague Dismissal Not Warranted on Summary Judgment Motion

In Philippopoulos, v. Philippopoulou, 461 F.Supp.2d 1321 ( N.D. Georgia, 2006) the father a citizen of Greece, petitioned, pursuant to the Hague Convention for the return of his minor daughter allegedly wrongfully relocated to the United States by her mother. The Respondent's moved to dismiss on the basis of her affirmative defense that the petition should be dismissed because it was not timely filed. Petitioner and Respondent were married in Greece and their daughter was born there. On July 1, 2005, Respondent and the child left the family's home in Greece on a planned vacation to the United States to visit Respondent's family in Georgia. Petitioner and Respondent agreed that Respondent and the child would return to Greece on August 15, 2005. On July 4, 2005, three days after departing Greece, Petitioner was served with an Extra-Judiciary Protest and Notice formally notifying him that Respondent intended to remain with the child in the United States and not return to Greece as she had previously agreed. On November 1, 2005, Petitioner filed an application with the National Center for Missing and Exploited Children (the "NCMEC") for the return of the child to Greece. On November 7, 2005, the U.S. State Department sent Respondent a letter notifying her that Petitioner had filed a request for the child's return. On November 28, 2005, the NCMEC contacted Respondent's former counsel, who indicated that Respondent was willing to participate in a mediation to resolve the dispute. On March 24, 2006, the mediation took place, but was unsuccessful. In May 2006, pursuant to Petitioner's request, the NCMEC began a search for pro bono counsel for Petitioner in the United States. On July 18, 2006, Michael J. Sullivan agreed to represent Petitioner. On August 11, 2006, Petitioner filed his petition in this Court for the return of his child. The Court found that Petitioner set forth a prima facie case of wrongful retention under the Hague Convention. It was undisputed that the child's habitual residence prior to visiting the United States was Greece and that Petitioner had custody rights pursuant to Greek law and was exercising them at the time of the alleged wrongful retention. Article 12 of the Hague Convention mandates the return of a child who has been "wrongfully removed or retained in terms of Article 3 and, at the date of commencement of the proceedings before the judicial or administrative authority of the Contract state where the child is, a period of less than one year has elapsed." Even if more than one year has elapsed, the child shall be returned "unless it is demonstrated that the child is now settled in its new environment." Respondent contended that the child should not be returned to Greece because the petition was filed more than one year after the wrongful retention of the child and the child is well-settled in her new environment. Citing In re Cabrera, 323 F.Supp.2d 1303, 1303 (S.D.Fla.2004), Respondent argued that the retention of a child becomes wrongful as soon as the non-retaining parent becomes aware of the retaining parent's true intention not to return. She argued that Petitioner became aware of her true intention not to return on July 4, 2005, when he was served with the Extra-Judiciary Protest and Notice, over one year before he commenced this action on August 11, 2005. Petitioner contended that his petition was timely because the wrongful retention did not begin until August 15, 2005, the date upon which Respondent failed to return to Greece as she had agreed. The Court agreed with Petitioner and found that his petition was timely filed. Under the Hague Convention a parent whose child is wrongfully retained from its home country has one year from the date upon which the wrongful retention began to file suit for the child's return. The court noted that while Petitioner probably could have filed suit immediately upon learning of Respondent's intention to wrongfully retain the child, Petitioner also had the right to wait to file suit until after the retention became wrongful. Because Respondent had agreed to return the parties' child to Greece on August 15, 2005, her retention of the child did not become wrongful until that date.  Thus, Petitioner had until August 15, 2006, to file this action. Because he filed his petition before that date, Respondent failed to carry her burden of showing that the petition should be dismissed for untimeliness. The Court also noted that under the Hague Convention, even if the petition was not filed within twelve months of when the retention became wrongful and the child is well settled, the Court has the discretion to return the child to Greece. Citing Antunez-Fernandes v. Connors-Fernandes, 259 F.Supp.2d 800, 815 (N.D.Iowa 2003). Therefore, Respondent failed to show that even if July 4, 2005, were the relevant date, there was no set of facts under which the petition could be granted. The Court thus found that Respondent had not established the Article 12 defense of timeliness as a matter of law, and denied the motion to dismiss the petition at this time on the basis of that defense.

 

Attorney Sanctioned For Making Materially False Statement to Court

In Rogovin v Rogovin, 27 A.D.3d 233, 812 N.Y.S.2d 41( 1st Dept, 2006) the Appellate Division held that Petitioner's attorney's failure in the custody proceeding to inform Family Court that the very relief he was seeking therein, an injunction against respondent's removing the subject child from the State of New York, had been denied, both by Supreme Court and the Appellate Division, in this Supreme Court habeas corpus proceeding he had also initiated on behalf of petitioner, was a sanctionable materially false factual statement. The omission was compounded by the attorney's assertion in opposition to the Law Guardian's motion for sanctions that he had verbally informed Family Court of the prior applications, which assertion was proven false by the transcript of the Family Court proceedings submitted with the Law Guardian's reply. The intent to protect a child does not justify a lack of candor with the court. It found no basis exists to disqualify the Law Guardian, who, having determined that the child was unimpaired in accordance with local standards, properly acted as the child's advocate in urging retention of the custodial status quo, rather than as an aide to the court in determining the child's best interests (citing, inter alia, Guardian Definitions and Standards, State of New York Unified Court System, Statewide Administrative Judge for Matrimonial Matters). Argument from the Law Guardian in support of the child's stated preferences is to be expected.

 

Hague Convention Does Not Give Courts Jurisdiction Over Visitation Claims

In Cantor v Cohen, 442 F.3d 196 (4th Cir. 2006) the Fourth Circuit Court of Appeals held that International Child Abduction Remedies Act ("ICARA"), 42 U.S.C. §§ 11601-11610, does not confer jurisdiction upon federal courts to hear visitation claims.

 

District Court Finds Under Colombian Law Father Was Exercising Rights of Custody Under Hague Convention

In Garcia v Angarita, 440 F.Supp.2d 1364 (S.D. Florida, 2006) the Court found that Title XII of the Colombian Civil Code sets forth the rights and duties between parents and children. Article 253 provides, "Both parents ... shall exercise the parental care in the upbringing and education of their legitimate children". Title XIV of the Colombian Civil Code sets forth the rights of "Patria Potestas." Article 288 provides that "Paternal authority is the set of rights that the law acknowledges to the parents over their non-emancipated children ..." It further provides that, "The exercise of the parental authority over their legitimate children shall be exercised jointly by both parents. In the absence of one of the parents, the other parent shall exercise the paternal authority." Article 338 of the Colombian Minors' Code provides that, "When a minor is going to go out of the country with one of the parents or with a person different from their legal representatives, they should previously obtain the permission of the parent or legal representative who is not traveling, authenticated before a notary or consular authority". The court found that that under Colombian law both parents exercised the rights of patria potestas at the time of the children's removal to the United States. However, based upon a provisional custody decree, the mother had the right to determine where, within the country of Colombia, the children would reside, at least until the Colombian courts entered a final decree that stated otherwise. The father retained a ne exeat right, however, pursuant to the provisions of Article 338 of the Minor's Code. Therefore, the mother was not permitted to relocate the children outside of Colombia without the permission of the father, which was not obtained.

 

 

Grave Risk of Harm Ruling Reversed By Tenth Circuit for Evidentiary Errors

In Didur v Viger, ( 10th Cir. 2006) No. 05-3440 D.C. No. 05-CV-2188-JWL) the Tenth Circuit Court of Appeals reversed the district court and remanded for further proceedings. It pointed out that the district court denied the petition on the basis that the respondent, Thomas Viger, met his burden of establishing by clear and convincing evidence a grave risk of harm to J.D. if the child were returned to Ms. Didur’s custody in Canada. The Court found that the parties had agreed that on the [grave risk] issue, petitioner was willing to proceed on a proffer from respondent of the facts that respondent believed he could prove. By agreeing to proceed on a proffer, petitioner was not agreeing that the respondent could actually prove those facts. The district court mischaracterized the July 18 hearing as an adversarial hearing where Ms. Didur had the opportunity to challenge the truthfulness of Mr. Viger’s accusations. The record reflected otherwise. The district court also determined that Ms. Didur had waived her right to challenge the admissibility of Mr. Viger’s evidence because she had not specifically objected to the district court’s decision to admit the evidence under the relaxed standards of the Hague Convention. The Court of Appeals disagreed. It found that Ms. Didur objected to the entire process employed by the magistrate judge in disregarding the parties’ agreement and treating the proffered evidence as fact without giving her the opportunity to challenge it. Necessarily included in this objection was an objection to the magistrate judge’s decision that all of the evidence was properly admissible for a merits determination. It held that the magistrate judge’s merits decision, as adopted by the district court, constituted a procedural error that required it to reverse the denial of Ms. Didur’s petition and remand for further proceedings to allow Ms. Didur to present rebuttal evidence and/or to challenge the admissibility of the proffered evidence presented by Mr. Viger. Note: The Court rendered an order and judgment which is not binding precedent, except under the doctrines of law of the case, res judicata, and collateral estoppel but which may be cited under the terms and conditions of 10th Cir. R. 36.3.

 

Seventh Circuit Embraces Mozes Approach To Determining Habitual Residence Under Hague Convention

In Koch v Koch, 450 F.3d 703 (7th Cir.,2006) Dane Koch appealed from the district court's order granting Antonia Koch's petition under the Hague Convention. The district court noted that the principal issue under the Convention and ICARA was whether Dane had removed the children from Germany wrongfully. That question turned on the "habitual residence" of the children at the time they were removed. The district court initially disavowed the Ninth Circuit's approach in Mozes, finding it inconsistent with the intent of the drafters of the Convention and with the jurisprudence of the other signatories. Applying a purely fact-based approach, the court found that the most important factors in determining habitual residence were geography and duration. Charles and Annalena had lived in Germany for more than three years, which constituted the near entirety of Annalena's life and well over half of Charles' life. The court found that in light of this duration, the parents' long-term plans regarding residence were largely irrelevant. Moreover, Dane, Antonia and the children were not in Germany on a visit nor was this a situation where one parent remained behind. Rather, the family moved to Germany as a family because Dane found work there. They took all of their belongings with them except for a few large items and established a home and a life in Germany. Dane worked, Antonia cared for the children and Charles attended school. Further, Dane and Antonia were not strangers to Germany, both having lived there for most of their adult lives. Thus, there can be little doubt that Charles and Annalena became habitual residents of Germany. Koch v. Koch, 416 F.Supp.2d 645, 652-53 (E.D.Wis.2006). The Seventh Circuit had not yet decided the standards for determining habitual residence and court surveyed the other circuits and some international decisions. It noted that many of the courts treated the inquiry as purely factual until the Ninth Circuit decided the case of Mozes v. Mozes, 239 F.3d 1067 (9th Cir.2001). Following Mozes, most of the circuit courts adopted the Ninth Circuit's analysis, which required the court to determine whether the parents intended to abandon their previous habitual residence, judging that intent at the last time the parents had a shared intent. That shared intent, under the Ninth Circuit's approach, could be overcome if the child had become acclimatized to the new place. The Seventh Circuit found that its sister circuits review the district court's findings of fact for clear error and review the court's application of the law to those facts as well as its interpretation of the Convention de novo. Seeing no reason to depart from the considered approach of our sister circuits, it decided to apply this standard of review. Determinations of intent involve questions of fact and it would defer to the district court's findings on intent unless they are clearly erroneous. The ultimate determination of habitual residence is a mixed question of law and fact to which it would apply de novo review. The Seventh Circuit saw no reason to disavow the Mozes approach. Mozes asks the court to determine first whether the parents shared an intent to abandon the prior habitual residence, in this case, the United States. In determining the parents' intent, the court should look at actions as well as declarations. When Dane and Antonia moved to Germany, they shared a settled intention to move there for an indeterminate period of time, delimited by their financial circumstances and by Dane's employment goals. Although they also shared a subjective wish to someday return to the United States, habitual residence is not determined "by wishful thinking alone." The establishment of a habitual residence requires an actual change in geography, as well as the passage of an appreciable amount of time. "When the child moves to a new country accompanied by both parents, who take steps to set up a regular household together, the period need not be long." Following Mozes, most of the sister circuits focused on the parents' last shared intent in determining habitual residence. Dane argued that the couple's shared intent to someday return to the United States was therefore determinative on the issue of habitual residence here. But shared intent to someday return to a prior place of residence does not answer the primary question of whether that residence was effectively abandoned and a new residence established by the shared actions and intent of the parents coupled with the passage of time. In Whiting v. Krassner, 391 F.3d 540, 548-550 (3d Cir.2004), cert. denied, --- U.S. ----, 125 S.Ct. 2938, 162 L.Ed.2d 871 (2005) the parents of an infant agreed that their child would reside with the mother in Canada for a period of two years and then would return to the United States depending on certain conditions. The court found that the fact that the mother and child were to return to the United States subject to certain conditions did not in any way diminish the parents' settled intention that the two were to remain in Canada for at least two years. The court characterized this as an intent to abandon the United States for a definite and extended period in the life of the infant. Together with a settled purpose, this agreement shifted the habitual residence of the child to Canada. The Seventh Circuit found that there was no meaningful difference between the situation presented in Whiting and the facts of the case and affirmed the judgment.

Will Provision For Guardianship Does Not Confer Rights of Custody Under Hague Convention

In Roy v Roy, 432 F.Supp.2d 1297 (S.D. Florida, 2006) the petitioners were the Irish grandparents who alleged that the minors were wrongfully removed to the United States from Ireland by their own father, the respondent. On July 29, 2005, the respondent ("the father") moved from Ireland to the United States with his three children. The father and the children had been living in Ireland since 1997, along with the children's mother, the father's wife ("the mother"). Prior to 1997, the family resided in England. However, the family moved to Ireland after the mother was diagnosed with cancer and chose to live near her Irish family. The mother passed away in November 2000, and the father and children continued to live in Ireland, where the children attended school and the father was employed until 2005. Ten days before the mother died, on October 27, 2000, she executed a will in Ireland. She had also previously executed a will in England. In the Irish will, the mother stated, "I appoint the Said Richard Hanley and Ellen Hanley to be Guardians of my infant Children." This Irish will was probated on August 20, 2003. While in Ireland, the father and children lived in the home of the petitioners, the maternal grandparents ("the grandparents"). The Grandparents argued that the children were wrongfully removed from their Irish home in violation of the Hague Convention. The Court noted that the Convention states that " 'rights of custody' shall include rights relating to the care of the person of the child and, in particular, the right to determine the child's place of residence." Art. 5. Furthermore, "rights of custody ... may arise in particular by operation of law or by reason of a judicial or administrative decision, or by reason of an agreement having legal effect under the law of the State." Art. 3. The grandparents alleged that the will appointed them testamentary guardians of the children, and that as testamentary guardians, they had rights of custody over the children. The grandparents were not automatically vested with guardianship of the children. Instead they were appointed guardians in the mother's will. Even if the grandparents' guardianship had included rights of custody, their rights as to both guardianship and custody were abrogated when the father objected to their joint guardianship. Section 7(3) of the Guardianship of Infants Act stated, "A testamentary guardian shall act jointly with the surviving parent of the infant so long as the surviving parent remains alive unless the surviving parent objects to his so acting." If the surviving parent does object, then under section 7(4), it is up the testamentary guardian to go to court to enforce his guardianship rights. Furthermore, "in such a case, the testamentary guardian cannot act as guardian unless, on application to the court, the court grants an order that the testamentary guardian shall act as guardian." The rights of the testamentary guardian are subject to agreement by the surviving parent unless superseded by a court order. The grandparents failed to go to an Irish court to enforce their guardianship rights and therefore they "cannot act as guardian" to the children. Since the grandparents cannot act as guardians without a court order, the did not have rights of custody under the Hague Convention.

District Court Defines Canadian Rights of Custody Under Hague Convention and Criteria for Wishes of the Child Defense.

In Yang v Tsui, --- F.Supp.2d ----, 2006 WL 2466095 (W.D.Pa) the child was sent from Canada to the father in Pittsburgh when the mother was had to be hospitalized for surgery. After the father refused to return her and obtained a custody order in Pennsylvania, the mother filed a petition seeking the return of the child, Raeann, to Canada. The District Court found that both parties fundamentally agreed that at the time Raeann left Canada to come to the United States they intended for her to live with her father until her mother recovered from surgery. While this was Yang's expectation, the parties also discussed what to do in the event that Yang would die from the surgery. They agreed that, in that case, Raeann should continue to live with Tsui. The evidence demonstrated that the original intent of the parties was for Raeann to stay approximately two to three months and that soon after Raeann came to the United States, Tsui decided to assert unilateral custody over Raeann. At the time of retention, Raeann was less than a month into what was expected to be a two to three month stay. In the words of the Third Circuit in Karkkainen, she could not have become "firmly rooted in her new surroundings" nor was Pittsburgh at that time the "family and social environment in which her life has developed." Even more important, the shared intent of the parents was not for Raeann to make Pittsburgh her home, unless Yang passed away. Accordingly, the Court found that Canada was Raeann's habitual residence on November 20, 2002. The District Court held that under Canada's Family Relations Act, R.S.B.C.1996, c. 128, s. 34, because the father and mother lived separate and apart, and there was neither a court order nor a written agreement, section 34(1)(b) applied, and custody belonged to the parent with whom the child usually resided, which was the mother. The Court noted that the unnumbered paragraph of Article 13 delineating the "wishes of the child exception" leaves its application wholly to the discretion of the district court. "This discretionary aspect of Article 13 is especially important because of the potential for brainwashing of the child by the alleged abductor. A child's objection to being returned may be accorded little if any weight if the court believes that the child's preference is the product of the abductor parent's undue influence over the child." 51 FR 10494-01, Section III.I(2). The Court must be satisfied not only that Raeann has reached an age and degree of maturity at which it is appropriate to take into account her views, but also that her objections are grounded in her own mature opinion and are not merely the conduit for the opinions of others. Based on the evidence of record, Tsui failed to prove either fact by a preponderance of the evidence.

New York Court of Appeals Adopts Doctrine of Equitable Estoppel

In Matter of Shondel J. v. Mark D., 40, the Court of Appeals affirmed the trial court and the Appellate Division, Second Department, in directing a man to pay child support for a child he did not father. The Court based its determination upon the doctrine of 'equity paternity,' or paternity by estoppel. The Court of Appeals focused on the best interests of the child, stating in an opinion by Judge Albert M. Rosenblatt for the 5-2 majority, that :. 'In allowing a court to declare paternity irrespective of biological fatherhood, the Legislature made a deliberate policy choice that speaks directly to the case before us,'. 'The potential damage to a child's psyche caused by suddenly ending established parental support need only be stated to be appreciated. Cutting off that support, whether emotional or financial, may leave the child in a worse position than if that support had never been given.' The Court of Appeals found that the Respondent had in every way held himself out to be the child's father, including buying her Christmas and birthday presents, referring to himself as 'daddy,' introducing her to his family, and regularly communicating with her. Judge George Bundy Smith dissented in an opinion joined by Judge Robert S. Smith. The dissent objected to the application of estoppel against a 'completely innocent litigant' who was misled by the child's mother. The mother swore in Family Court that she had not had sexual relations during the relevant time span with anyone other than Mark, an assertion that DNA analysis proved was a lie. They said the decision rewards people who make no effort to nurture or support a child who may be their own while penalizing people like Mark who immediately assumed responsibility.

 

New York Court of Appeals Holds that State Constitution Does Not Grant Right to Marry to Same Sex Couples

In Hernandez v. Robles, 86, Samuels v. NYS Dept. of Health, 87, Kane v. Marsolais, 88, and Seymour v. Holcomb, 89, a 4-2 decision the Court of Appeals affirmed four Appellate Division decisions that had declined to extend the right to marry to same-sex couples. The opinion written by Judge Robert S. Smith found that a rational basis existed for the Legislature's decision to limit marriage to opposite-sex couples when it enacted the Domestic Relations Law in 1909, and whether same-sex marriage, as opposed to simply marriage itself, constitutes a fundamental right. He stated that there are at least two grounds that rationally support the limitation on marriage that the Legislature has enacted. First, the Legislature could rationally decide that, for the welfare of children, it is more important to promote stability, and to avoid instability, in opposite-sex than in same-sex relationships. Second, the Legislature could rationally believe that it is better, other things being equal, for children to grow up with both a mother and a father.' Such rational grounds were sufficient to uphold the Appellate Division decisions, as the plaintiffs failed to establish grounds for a heightened level of scrutiny, such as a fundamental right under the state Constitution to same-sex marriage. Chief Judge Judith S. Kaye wrote a lengthy dissent, which was joined by Judge Carmen Beauchamp Ciparick.

 

Matrimonial Commission Report - Recommends Legislature Adopt No Fault Divorce, elimination of professional degrees and licenses as a marital asset and Calls for Special Attention to the Assignment and Recruitment of Matrimonial Judges

 

Q & A about Common Law Marriage States

Today, only ten states and the District of Columbia recognize common-law marriage entered into within their boarders They are Alabama, Colorado, Kansas, Montana, Oklahoma, Iowa, Rhode Island, South Carolina, Texas, Utah and the District of Columbia. New Hampshire recognizes common law marriages only for probate purposes and they are effective only at death. Since 1990 Georgia, Idaho, Ohio, and Pennsylvania have abolished common law marriage, but recognize common law marriages entered into within their boarders before it was abolished. More information .

Counsel Now Required Until October 1, 2006 to Write a Letter to Court Where No Decision in 60 Days

22 N.Y.C.R.R.  202.8 (h) was amended to require counsel to advise the court by letter that 60 days have elapsed after a motion has been finally submitted or oral argument held, whichever was later, and no decision has been issued by the court. The letter must indicate  the name and index number of the case and state: "Pursuant to section 202.8(h) of the Uniform Civil Rules for the Supreme and County Courts, please be advised that 60 days have elapsed after submission on (date) of the motion by (party) for (relief requested), and no decision has been issued." The letter may not contain any other substantive language. The letter requires no response. Note: This rule has been changed effective October 1, 2006. (See Above)
 

 

Medical Reports Not admissible as Business Records Where They Contain Doctor's Opinion or Expert Proof

In Bronstein-Becher v Becher, --- N.Y.S.2d ----, 2006 WL 240531 (N.Y.A.D. 2 Dept.), during a hearing pursuant to a violation petition, the evidence revealed that the father failed to make the requisite child support payments. Failure to pay support as ordered constitutes " 'prima facie evidence of a willful violation'. Once prima facie evidence of willful violation was presented, the burden shifted to the father to offer competent, credible evidence of his inability to make the support payments. At the hearing, the father's attorney sought to introduce into evidence medical reports from the father's psychiatrist, Dr. Edward M. Stephens. While the reports were certified, the hearing court found them to be inadmissible, stating they were "not a medical record [and] not a hospital record. It's a letter. Therefore, it's hearsay." The Appellate Division held that the hearing court was correct in refusing to accept Dr. Stephen's medical reports into evidence. A physician's office records, supported by the statutory foundations set forth in CPLR 4518(a), are admissible in evidence as business records. However, medical reports, as opposed to day-to-day business entries of a treating physician, are not admissible as business records where they contain the doctor's opinion or expert proof. Here, Dr. Stephens' two "narrative reports" were simply letters summarizing his diagnosis, treatment, and opinion concerning the father's ability to return to work. No proper foundation was provided demonstrating that they were in fact business records (see CPLR 4518[a] ). Their certification did not cure this defect as only hospital records, and not physician office records, are admissible by certification. Since the father failed to submit evidence sufficient to show his inability to pay, he failed to rebut the mother's prima facie case. Accordingly, the Family Court properly found him to be in contempt for willfully failing to obey the child support order.

 

Error to Terminate Maintenance Where Former Wife Cohabits With Unrelated Male

In Florio v Florio, --- N.Y.S.2d ----, 2005 WL 3676634 (N.Y.A.D. 3 Dept.) the parties were married in 1979 and the action was commenced in 2002. Supreme Court, inter alia, awarded plaintiff the three rental properties acquired by the parties during marriage, with a directive that he be responsible for the mortgages and related expenses until such time as he elected to sell such properties and made a similar award to defendant as to the marital residence, except that defendant was directed to sell the property on or before June 30, 2005, at which time she would retain all proceeds from the sale. Plaintiff was directed to pay defendant maintenance of $700 per week until June 30, 2005, at which point his maintenance obligation would be reduced to $400 per week. The Appellate Division rejected defendant's assertion that Supreme Court erred in granting plaintiff a $75,000 credit in distributing his employee savings plan. It stated that although plaintiff's proof on this point could have been presented with greater clarity, his testimony and the documentary evidence adduced at trial were sufficient to document the various marital expenses he paid following his departure from the marital residence. While there may have been deficiencies in plaintiff's paper trail, there was no serious dispute that plaintiff paid the expenses at issue, nor was there any proof that defendant in any way contributed to such payments. Nor was there any error or inequity in Supreme Court's directive that defendant sell the marital residence by a particular date. Defendant's testimony made clear that she could not have remained in the marital residence pending trial had plaintiff not paid the mortgage and the home equity line of credit and that she could not afford to retain the marital residence at her current income level. Supreme Court was not arbitrarily removing the wife from the marital residence but, rather, was imposing a limit upon the amount of time that plaintiff would be required to fund defendant's continued occupancy of it . Although Supreme Court essentially divided the remaining cash assets 50% to each party, the real estate was divided 35% to defendant and 65% to plaintiff. Supreme Court's only expressed rationale was that plaintiff was financially better able to maintain the rental properties until they could be sold. However, these properties were awarded, in kind, to plaintiff. The remaining tangible personalty was also awarded to plaintiff, although its value was not established by competent evidence by either party. The Appellate Division held that some semblance of parity must be achieved. In this 25-year marriage, not only did defendant contribute financially, but Supreme Court found that she contributed as a spouse, parent and homemaker. Under these circumstances, Supreme Court abused its discretion in not dividing all assets 50% to each party. The Supreme court's written decision provided that the award of maintenance "shall cease upon the [d]efendant's remarriage or cohabitation with an unrelated male or the death of the [p]laintiff." Defendant contended that Supreme Court erred in permitting plaintiff to terminate maintenance payments upon proof that she is cohabiting with an unrelated male as Domestic Relations Law 248 requires, in addition to cohabitation, proof that defendant "hold[s] herself out as his wife, although not married to such man." As the case law on this point plainly requires that both elements of the statute be established and, further, that mere cohabitation is insufficient any attempt by Supreme Court to impose a less stringent requirement clearly would be erroneous. Supreme Court did not err in the amount or duration of the maintenance awarded to defendant. While defendant held a Master's degree in elementary education and could, by her own admission, seek a better paying position, neither party presented any testimony as to the likelihood of the then 47-year-old defendant, who was earning $15,000 per year as a teacher's assistant, obtaining a full-time teaching position that would allow her to be self-supporting. Having failed to demonstrate that defendant was intentionally underemployed and/or capable of securing a full-time position well in excess of her then current salary, and in light of the income disparity existing between the parties at the time of trial, plaintiff could not now be heard to complain as to his maintenance obligation. However, Supreme Court abused its discretion as to the award of counsel fees to defendant. She received sufficient assets to enable her to pay her own counsel fees. Under such circumstances, Supreme Court abused its discretion in ordering plaintiff to pay defendant's then outstanding counsel fees in the amount of $7,500, particularly in view of the fact that defendant utilized marital assets to pay her initial round of counsel fees.

 

Adultery Committed After Action Commenced is Still Grounds for Divorce

In Golub v Ganz, ---- N.Y.S.2d ----, 2005 WL 2665335 (N.Y.A.D. 3 Dept.) the Appellate Division rejected the defendants argument that the trial court should not have granted a divorce on the basis of adultery because his only act of adultery took place after the action was commenced and because plaintiff's own alleged adultery constituted a complete defense to his adultery. Defendant's adultery, committed after the parties were married but before any judgment of divorce, fit within the parameters of Domestic Relations Law 170(4). The court held that since no provision of the Domestic Relations Law precludes a party from obtaining a divorce upon acts of adultery that occur after an action is commenced and because no prejudice had been demonstrated by defendant a divorce could be granted on this ground (citing, inter alia, 1 Foster, Freed and Brandes, Law and the Family New York 6:9, at 392 [2d ed]). Nor was the plaintiff's acknowledgment at trial that she became "romantically involved" with another during the late summer of 2002, sufficient to establish that she committed adultery such that the defense of recrimination was established. Since plaintiff's adultery was not established by independent satisfactory evidence in the first instance, no negative influence arises from her invocation of the Fifth Amendment right against self-incrimination when asked at trial if she engaged in a sexual relationship with another.

 

Court of Appeals Holds Single Action Rule Not Applicable to Matrimonial Action

In
Chen v Fischer, ___NY2d___, 2005 WL 3452221 (N.Y.) Supreme Court found that the allegations in Chen's personal injury action were "virtually identical" to those in her counterclaim for divorce and arose out of the same transaction or series of transactions. The court determined that the tort action was barred by res judicata. The Appellate Division affirmed, agreeing that the action was barred because the tort claim could have been litigated with the divorce action and Chen did not expressly reserve the right to bring that claim when she withdrew her fault allegations for purposes of the stipulation. The Appellate Division extended the rule set forth in Boronow v. Boronow (71 N.Y.2d 284, 290 [1988] ), that issues relating to marital property be decided with the matrimonial action, to interspousal tort actions, holding that an interspousal tort action seeking to recover damages for personal injuries commenced subsequent to, and separate from an action for divorce is barred by claim preclusion. (12 A.D.3d 43, 47 [2004]. The Court of Appeals reversed. It held that to require joinder of interspousal personal injury claims with the matrimonial action would complicate and prolong the divorce proceeding. In addition, parties should be encouraged to stipulate to, rather than litigate, the issue of fault. Significantly, the Court pointed out that if fault allegations are actually litigated in a matrimonial action, res judicata or some form of issue preclusion would bar a subsequent action in tort based on the same allegations. It declined to adopt the reasoning of the New Jersey Supreme Court in Tevis v. Tevis (79 N.J. 422, 400 A.2d 1189 [1979] ), which held that under that State's "single controversy" rule, the interspousal personal injury claim should have been brought with the matrimonial action so that the issues between the parties could be decided in one proceeding in order to prevent protracted litigation.
 

Important Tax Law Changes For 2006 That You Should Know About    

 

Hague Convention - Grave Risk of Harm Defense Established

In
Didur v Viger, 392 F.Supp.2d 1268 (D. Kansas, 2005) the Mother filed a petition for return of her child to Canada pursuant to Hague Convention. One of the four defenses is the "grave risk" exception, under Article 13(b) of the Hague Convention, which allows a country to withhold the return of an abducted child if "there is a grave risk that his or her return would expose the child to physical or psychological harm or otherwise place the child in an intolerable situation”. The District Court, held that the father established that the child's return to his mother's custody in Canada would expose him to grave risk of physical or psychological harm. The Canadian child welfare authorities documented incidents in which the mother repeatedly drove while drunk with the child, the mother was drunk in public with the child alongside her, the mother was intoxicated repeatedly while pregnant with the child's younger sibling, the mother refused to parent the child, and the mother suffered from mood swings and depression, the child was unable to obtain counseling in Canada, the mother sought to have her parents obtain custody of child, and the Canadian authorities recommended against returning the child to Canada and stated that he would be placed in foster care if he was returned.

Prospective Child Support Payments May Be Waived

In Williams v Chapman, 2005 WL 2782578 (N.Y.A.D. 3 Dept.) the Third Department joined the other Departments in holding that prospective child support payments may be waived. Pursuant to an open court stipulation Family Court ordered respondent to pay petitioner $150 per week in child support for the parties' two unemancipated children. In February 1999, one child relocated to the father's residence and the parties agreed, in a handwritten document, that child support payments to the mother would be suspended while each party had physical custody of one of the children. In 2003, the mother commenced a proceeding, seeking approximately $37,000 in child support arrears asserting that the father failed to pay support for both children after one child left the mother's residence. Family Court found that the mother expressly waived prospective child support payments in the parties' agreement and denied her petition. The Third Department affirmed. It noted that in Matter of Dox v. Tynon, 90 N.Y.2d 166, 168 [1997] the Court of Appeals has held that pursuant to the New York State Support Enforcement Acts of 1986 and 1987 a recipient may not impliedly "waive the right to unpaid child support simply by failing to demand payment or seek enforcement of support obligations", but declined to reach the question of whether express waivers of future child support payments were similarly impermissible. The mother argued that express waivers of child support must also be deemed to violate the legislative intent of the amendments at issue in Matter of Dox. The Appellate Division rejected her argument which was at odds with positions taken by the other Departments. The purpose of the amendments under consideration in Matter of Dox was to preclude forgiveness of child support arrears to ensure that respondents are not financially rewarded for failing either to pay the order or to seek its modification. In determining that implied waivers are not permissible, the Court of Appeals emphasized that such waivers are "based on petitioner's behavior after respondent declined to make the requisite payments". Here the waiver was based upon the mother's conduct prior to any default, that is her agreement to forego future support payments, rather than support arrears. The court held than contrary to the mother's argument regarding legislative intent, when future child support payments are waived, no arrears accrue, and the statutory amendments precluding the cancellation of arrears are inapplicable. The court rejected the mother's argument that the express waiver given was invalid as a matter of law due to the parties' failure to comply with Family Court Act 413(1)(h). While she was correct that in the absence of an express waiver, a party seeking modification of a child support obligation is required to apply to the courts and any order entered in such a proceeding must comply with the CSSA in arguing that the parties' out-of-court agreement must also comply with the statutory requirements, the mother failed to distinguish between a modification agreement and a waiver. A modification agreement 'is binding according to its terms and may only be withdrawn by agreement while a waiver requires no more than the voluntary and intentional abandonment of a known right and, to the extent that it remains executory, may be withdrawn without agreement. Thus, an agreement that does not satisfy the prerequisites of a legally binding modification agreement may nonetheless constitute a valid waiver.

Actual Loss and Counsel Fees Recoverable for Contempt

In
Jamie v Jamie, 19 A.D.3d 330, 798 N.Y.S.2d 36 (1st Dept. 2005) the Appellate Division reduced a Judgment in favor of plaintiffs and against defendant in the amount of $217,626.87, to reduce the award to $150,000. The Court construed Judiciary Law 773 to mean that where an actual loss has been caused by a contempt, the aggrieved party is entitled to recover not only the amount of such loss, but also the reasonable costs and expenses in proving such amount and the attendant contempt. To hold that reasonable costs and expenses are recoverable only when an actual loss or injury is not shown would be to make recovery of an actual loss or injury anomalously where, as here, the claimed costs and expenses incurred in prosecuting the contempt are much larger than the claimed actual loss caused the contempt. The Court overruled its prior holdings that attorneys' fees are not recoverable where actual damages are shown.

Divorce By Lockout Denied Where Husband Had Key

In
Soldinger v Soldinger --- N.Y.S.2d ----, 2005 WL 1962290 (N.Y.A.D. 2 Dept.) the Appellate Division reversed the judgment of divorce, on the law and dismissed the complaint. The plaintiff commenced the action for a divorce pursuant to Domestic Relations Law 170(2) on the ground that the defendant had abandoned him for more than one year by locking him out of the marital residence in 1986 without justification and preventing him from returning ever since. The Appellate Division held that abandonment by lock-out occurs when one spouse changes the lock on the entrance door of the marital abode, or the place where he or she is living, thus effectively excluding the other spouse, unless the act is justified. The plaintiff's testimony failed to establish a prima facie case of abandonment by lock-out since, among other things, he admitted that he was not excluded from the marital residence, he retained the keys to the martial residence, and the defendant never changed the locks. Thus, the Supreme Court should have granted the defendant's motion made at the close of the plaintiff's case to dismiss the action.
 

Error To Award Husband Share of Assets Titled in Wife’s Name Where No “Economic Partnership”

In Galvin v Galvin, 799 N.Y.S.2d 547 (2d Dept. 2005) the Appellate Division modified the judgment, on the law, by deleting the provisions thereof awarding the husband a distributive share of the property know as 1102 Victory Blvd., Staten Island, N.Y., and the accounts known as Bernard Herold & Co., Inc., Account No. 5M7-105023, Bernard Herold & Co., Inc., Account No. 577-141291, Merrill Lynch Account No. 433-51051, Merrill Lynch SEP Account No. 433-51M78, and a Mercedes Benz and denied the defendant a distributive share of those assets. It held that the trial court erroneously awarded the husband a distributive share of these assets which were titled solely in the plaintiff wife's name. Except for the marital home, the parties kept their finances separate during the course of the marriage. They conducted themselves during the marriage in a manner inconsistent with the typical "economic partnership." The husband played an extremely limited role in the marriage and failed to provide any significant financial resources to the marriage. In view of these facts, the trial court erred in awarding the husband a distributive share of these assets.


Purchase Price Not Evidence of Value In Rapidly Rising Real Estate Market

In
London v London, 2005 WL 1846874 (N.Y.A.D. 3 Dept.), the Appellate Division held that the trial court erroneously found that the marital residence was a marital asset despite uncontroverted evidence that it was acquired by defendant prior to the marriage. As the nontitled spouse, plaintiff had the burden of establishing the value, if any, that was added to this property by her direct or indirect contributions during the marriage. As she did not, Supreme Court should not have awarded her any interest in this asset. Moreover, it was error for Supreme Court to order this separate property sold.(citing Carr v. Carr, 291 A.D.2d 672, 676-677 [2002] ). Supreme Court also found that defendant's pension and profit-sharing trust plans were marital assets despite uncontroverted evidence that these plans were established prior to the marriage while defendant was operating his own professional corporation. However, there is a marital component to these assets, as contributions were made after the marriage and before the dissolution of the professional corporation. The Appellate Court rejected defendants argument that plaintiff was entitled to no share in these assets by reason of her failure to offer proof of valuation concerning the separate and marital portions of these assets. Such proof is necessary only if the asset will be the subject of a distributive award. Rather than make a distributive award, Supreme Court erroneously equally divided these accounts without giving the defendant credit for his contributions. The Appellate Division held that the Majauskas formula ( Majauskas v. Majauskas, 61 N.Y.2d 481, 488-493 [1984] ) should be applied to properly distribute these accounts. The Supreme Court properly determined that certain premises acquired by defendant prior to the institution of the action, was marital. However, even though only about six months elapsed between those events, in a rapidly rising real estate market, evidence of a possible purchase price may not be the equivalent of the actual value of the property at the time of the commencement of the action.

Federal Court Can Not Enforce Rights of Access Under Hague Convention

In
Wiezel v Wiezel-Tyrnauer — F.Supp.2d ----, 2005 WL 22850 (S.D.N.Y.) the father filed an application for the return of his children to Israel pursuant to the International Child Abduction Remedies Act and the Hague Convention on the Civil Aspects of International Child Abduction. His Petition was made pursuant to Article 12 of the Convention, which provides "Where a child has been wrongfully removed or retained...the judicial or administrative authority of the Contracting State where the child is...shall order the return of the child forthwith." Although he claimed to be a custodial parent of the Children, he did not seek the permanent return of the Children to Israel. Instead he sought court-ordered visitation or access rights, specifically an order directing the Mother to arrange, at her expense, for the children to visit their Father in Israel twice per calendar year, and to allow the Father to have at least four unsupervised visits per year with the Children in the United States. The District Court granted the mother’s motion to dismiss the petition because the father did not seek the permanent return of the children to Israel. The jurisdictional issue was whether the court had jurisdiction over an Article 12 claim by a petitioning parent who claims to have custody rights but is seeking as, a remedy, only visitation and other access rights. Petitioner was seeking to have the court enforce his custody rights by ordering visitation rights. The Court noted that Article 12 directs the court to order a single remedy, the return of the child, upon a finding of a wrongful removal. The Convention does not permit the court to order the relief that Petitioner was seeking. Moreover, the Convention sets forth separate procedures by which signatory nations may enforce access rights of petitioning parents, and those procedures do not involve the federal courts. While Article 12 addresses procedures to effectuate the return of a wrongfully removed child, Article 21 concerns "organizing or securing the effective exercise of rights of access" to a child. Although Article 12 specifically refers to action by the "judicial or administrative authority" of a member nation, Article 21 makes no mention of recourse to a judicial authority. Instead, a parent must apply to the "Central Authority" of a nation to secure enforcement of his or her rights of access, and the "central authority" for the United States is the Department of State. The court found that it lacked jurisdiction to issue orders to create and secure access rights. Lacking the authority to order the relief requested, the court found that the action had to be dismissed.

No Constitutional Right to Have Order Of Protection Enforced

In Castle Rock v. Gonzales, 2005 WL 1499788 (U.S.) the U.S. Supreme Court, in a 7-2 decision, held that an individual who has obtained a state-law restraining order commonly know as "order of protection", does not have a constitutionally protected property interest in having the police enforce the restraining order when they have probable cause to believe it has been violated.

Deadbeat Parent Can Not Challenge Subject Matter Jurisdiction of Family Court

In United States v. Kerley, 8/4/2005 NYLJ 12 (col. 4) the U.S. Court of Appeals for the Second Circuit held that the Federal Courts may not hear a challenge to the subject matter jurisdiction of the Family Court hearing examiner in a prosecution for violating the Deadbeat Parents Punishment Act, 18 U.S.C. 228. The defendant was prosecuted under the Federal Law for owing more than $100,000 in child support arrears and moved to dismiss the case, on the grounds that, inter alia, the Family Court hearing examiner lacked subject matter jurisdiction to enter the order of support. Second Circuit Judge Joseph McLaughlin stated that every circuit to consider the matter has recognized that federal courts are not to allow collateral challenges into the substantive merits of the underlying support order, and the Second Circuit has stated that the Deadbeat Parents Punishment Act (DPPA) assumes the validity of state court judgments and the "family policies" that those judgments embody.
 

Right to Challenge Reasonableness of Law Guardians Fee at Hearing and Assert Malpractice

In Mars v Mars, 2005 WL 1389223 (N.Y.A.D. 1 Dept.) the Appellate Division held that because the court directed plaintiff to pay the law guardian's fees and the children were old enough to articulate their wishes, plaintiff has standing to assert legal malpractice as an affirmative defense to the fee application to the extent of challenging that portion of the fees attributable to advocacy, as opposed to guardianship. Adopting the rule enunciated by the Second Department that "if a parent who has been directed to pay a fee contests a law guardian's claims relative to the time expended and the reasonable value of the services provided, he or she should be afforded hearing on the issue" (citing Matter of Plovnick v. Klinger, 10 AD3d 84, 91 [2004] ), the Appellate Division held that if as plaintiff alleged, the law guardian's invoices reflect work never done, plaintiff must be afforded the opportunity to challenge the reasonableness of the law guardian's fee at the fee hearing.

In Weinstein v Weinstein, 2005 WL 1088251 (N.Y.A.D. 1 Dept.) the Appellate Division affirmed an order which granted plaintiff's motion for an award of $300,000 in counsel fees. It held that the court properly exercised its discretion in awarding counsel fees, given the parties' respective financial circumstances and all the other circumstances of the case, stating that: A Defendant has always been far more able than plaintiff to pay legal fees in connection with this proceeding. His substantial resources have been a significant factor in achieving the desired outcome with regard to custody of the children. This has resulted in an escalation of legal fees for plaintiff.@

In Hathaway v Hathaway, 791 N.Y.S.2d 631 (2d Dept,2005) the Supreme Court, inter alia, dissolved the marriage, equitably distributed 70% of the marital assets to the plaintiff and 30% of the marital assets to him, awarded him maintenance in the sum of $1,000 per month until July 15, 2003, and directed that the plaintiff's "outstanding legal fees ... and those fees paid previously from her separate property ... be paid to plaintiff's counsel and reimbursed to plaintiff, respectively, from the marital assets prior to the distribution to the parties." The Appellate Division modified the judgment on the law, by deleting the provision regarding the plaintiff= s legal fees. It held that the distributive award of 70% of the marital assets to the plaintiff was a provident exercise of discretion. While the parties were married for a considerable period, approximately 33 years, and although the defendant devoted significant time to the parties' two daughters' educational and athletic activities during most of that time, the defendant refused to work, against the plaintiff's wishes, despite being skilled in the computer field and otherwise gainfully employable. The plaintiff was the sole wage earner, and the plaintiff also performed substantially all of the usual and customary housekeeping duties and was evenly involved with the upbringing of the children, while the defendant's contribution to the marriage was minimal. The defendant contended that the Supreme Court improperly awarded him rehabilitative maintenance in the sum of only $1,000 per month until July 2003, as opposed to life-time maintenance for a much larger amount, due to, inter alia, his age, alleged poor health, claimed incapability of becoming self-supporting, and the plaintiff's superior financial position. The Appellate Division held that Supreme Court providently exercised its discretion in granting the defendant limited maintenance, since there was little to no evidence regarding the parties' pre-separation standard of living or any evidence regarding the defendant's needs, the defendant, who had a college education and worked during the early years of the marriage, had the skills for gainful employment in the computer field in which he worked following the parties' physical separation, and despite having been awarded only 30% of the marital property, the actual amount of his distributive award was relatively high. The Supreme Court erred in directing that the plaintiff's "outstanding legal fees ... and those fees paid previously from her separate property ... be paid to plaintiff's counsel and reimbursed to plaintiff, respectively, from the marital assets prior to the distribution to the parties." This provision effectively made the defendant, the non-monied spouse, pay a substantial portion of the counsel fees of the monied spouse, the plaintiff who was worth over $1 million, in violation of Domestic Relations Law ' 237 and, therefore, was improper.

In Stella v Stella, 791 N.Y.S.2d 20, (1st Dept.2005) the Appellate Division affirmed a Judgment which awarded plaintiff pendente lite counsel and expert fees, plus interest, in the total amount of $227,726.33, It held that inasmuch as the record disclosed that defendant husband had significantly greater financial resources at his disposal than plaintiff wife, and that defendant's actions had caused protracted litigation, the court properly exercised its discretion in making the interim awards.

In Rudick v Rudick, ___AD3d___, 2005 WL 600678 (N.Y.A.D. 2 Dept.), the mother appealed from an order which, after a hearing, granted the father's application for a downward modification of his maintenance obligation. The Appellate Division dismissed her appeal holding that her failure to include transcripts of the support hearing required dismissal of her appeal. It stated that it is the obligation of the appellant to assemble a proper record on appeal. The failure to provide necessary transcripts inhibits the court's ability to render an informed decision on the merits of the appeal. The papers provided were patently insufficient for the purpose of reviewing the issues she raised.

In Matter of Linksman v Linksman, ___AD3d___, 2005 WL 646367 (N.Y.A.D. 2 Dept.) pursuant to the parties 1997 Virginia divorce decree and their previously entered into settlement agreement, the father's child support obligation was $400 per month. In 2001 the Family Court modified the father's obligation by reducing it to $0. In 2003 the mother commenced a proceeding in the Family Court to enforce the Virginia decree and for arrears. A Support Magistrate awarded the mother arrears in the sum of $15,835. The Appellate Division denied the petition and dismissed the proceeding holding that because the mother failed to demonstrate that the Virginia decree was registered in New York, New York lacked subject matter jurisdiction to enforce the decree (citing 28 USC ' 1738B[I]; Family Ct Act ' ' 580-603, 580-611[a].

In Matter of Brim v Combs, 2005 WL 758112 (N.Y.A.D. 2 Dept.), a child support proceeding to vacate a child support agreement and modify the father's child support obligation, the father a well known singer, appealed from an order of the Family Court which, inter alia, awarded the mother child support of $35,000 per month and an attorney's fee of $60,000. The Appellate Division modified the order by directing the father to pay child support of $21,782.08 per month and remitted for further proceedings. It found that in calculating the award of child support to the mother under Family Court Act 413, the Support Magistrate erred in basing the award in part on the amount of child support the father paid for his other child by a different woman, particularly where no evidence was presented as to that child's expenses, resources, and needs. It held that " To this end, in high income cases, the appropriate determination under Family Court Act 413(f) for an award of child support on parental income in excess of $80,000 should be based on the child's actual needs and the amount that is required for the child to live an appropriate lifestyle, rather than the wealth of one or both parties (citing Anonymous v Anonymous, 286 AD2d 585). It found that the mother's net worth statement and her extensive testimony at the hearing established that her expenses related to the child were $21,782.08 per month, exclusive of the child's educational, health, medical, dental, extracurricular activity, transportation, security, and summer camp expenses, which in any case were paid by the father. This amount was deemed admitted as fact by the father due to his failure to comply with the compulsory financial disclosure requirements of Family Court Act 424-a. It held that the Family Court erred in awarding $35,000 in monthly child support to the mother. Instead, the mother should have been awarded monthly child support in the sum of $21,782.08 to satisfy the child's actual needs and to afford him an appropriate lifestyle.

In Redder v Redder, 2005 WL 549412 (N.Y.A.D. 3 Dept.)) the Law Guardian applied for a fee in excess of the statutory limit and for payment of that fee from plaintiff. Supreme Court awarded a fee of $7,125 and directed each party to pay half of that amount to the Law Guardian. Both parties appealed arguing against the award of a fee payable equally by the parties directly to the Law Guardian. The Appellate Division noted that Law Guardian Fees are governed by the pertinent standards regarding compensation (see Judiciary Law 35[3]; 22 NYCRR 835.5). With respect to compensation, while the statutes and regulations speak directly to a procedure for payment from the state (see Family Ct Act 248; 22 NYCRR 835.5), there is no specific statutory or regulatory scheme for direct payment of an appointed Law Guardian by a parent or parents (see generally Brandes, Compensation and Law Guardians, NYLJ, July 28, 1998, at 3, col 1). The lack of parameters for a direct-pay system creates the potential for issues about the integrity of the appointment process in such situations (which often pay no attention to the statutory caps on compensation for assigned counsel), the independence of the Law Guardian, and raise concerns about fundamental fairness to all children regardless of the economic status of their parents. It noted that it had previously stated, in dicta, that "Law Guardian costs shall be payable by the [s]tate". While acknowledging that resolution of this issue is susceptible to more than one reasonable view (citing Matter of Plovnick v. Klinger, 10 AD3d 84 [2d Dept 2004] ) and there are policy arguments supporting different feasible approaches, it held that until the Legislature or Court of Appeals provides otherwise, the current statutory and regulatory framework should be interpreted as limiting compensation to Law Guardians appointed pursuant to the Law Guardian Program in a contested custody proceeding to payment by the state ( citing Lips v. Lips, 284 A.D.2d 716, 717 [2001] ); see also Family Ct Act 248 ["The costs of law guardians ... shall be payable by the state of New York"]; Matter of Lynda A.H. v. Diane T.O., 243 A.D.2d 24, 27-28 [4th Dept 1998], lv denied 92 N.Y.2d 811 [1998] [holding that Family Court "had no authority to compel the parties to pay the Law Guardian's legal fees and expenses"]; Brandes, Compensation and Law Guardians, NYLJ, July 28, 1998, at 3, col 1). The order directing the parties to pay the Law Guardian directly was reversed, and the Law Guardian was told he could apply for a fee as provided in 22 NYCRR 835.5.

In Kazel v Kazel, 3 N.Y.3d 331, 819 N.E.2d 1036, 786 N.Y.S.2d 420 (2004) the Court of Appeals held that a judgment of divorce and qualified domestic relations order (QDRO) awarding an interest in the husband's pension plan do not automatically include pre-retirement death benefits available under the plan. If the intent is to distribute such benefits, that should be separately, and explicitly, stated. (Read Comprehensive Discussion of Case)

In Covington v Walker, 3 N.Y.3d 287, 819 N.E.2d 1025, 786 N.Y.S.2d 409 (2004) the Court of Appeals held that plaintiff's cause of action for divorce on the ground of imprisonment pursuant to Domestic Relations Law 170 (3), brought 16 years after the commencement of defendant's confinement, was not barred by the five-year statute of limitations as set forth in Domestic Relations Law 210. The statute of limitations is measured from the date of defendant's release from prison (see Domestic Relations Law 170 [3] [providing that an action for divorce may be maintained on the ground of the defendant's confinement in prison for a period of at least three consecutive years]). The Court concluded, based on the legislative history, and public policy, that the cause of action accrues on the date defendant completes his third consecutive year of incarceration, but the statute of limitations does not begin to run until the date he is released from prison. Thus, plaintiff's divorce action was not time-barred. (Read Comprehensive Discussion of Case)

In Gitter v Gitter, 396 F.3d 124 (2nd Cir.) the Second Circuit Court of Appeals construed the phrase "habitually resident" as contained in the Hague Convention on the Civil Aspects of International Child Abduction. The Court held that in determining a child's habitual residence, a court should apply the following standard: "First, the court should inquire into the shared intent of those entitled to fix the child's residence (usually the parents) at the latest time that their intent was shared. In making this determination the court should look, as always in determining intent, at actions as well as declarations. Normally the shared intent of the parents  should control the habitual residence of the child. Second, the court should inquire whether the evidence unequivocally points to the conclusion that the child has acclimatized to the new location and thus has acquired a new habitual residence, notwithstanding any conflict with the parents' latest shared intent." The Court also held that in cases arising under the Convention, a district court's factual determinations are reviewed for clear error. However, the district court's application of the Convention to the facts it has found, like the interpretation of the Convention, is subject to de novo review. (Read Comprehensive Discussion of Case.)

 

 

It’s That Time Again! Know What is in The Act of 2004

The Internal Revenue Code law contains five provisions that provide benefits to taxpayers with children: (1) the dependency exemption; (2) the child credit; (3) the earned income credit; (4) the dependent care credit; and (5) head of household filing status. Each provision has separate criteria for determining whether the taxpayer qualifies for the applicable tax benefit with respect to a particular child. A taxpayer is required to determine his or her eligibility for each benefit separately.

As of October 4, 2004 the Internal Revenue Code contains a uniform definition of a "qualifying child" for purposes of the dependency exemption, the child tax credit, the earned income credit, the dependent care credit and head of household filing status. A taxpayer may claim an individual who does not meet the uniform definition of qualifying child (with respect to any taxpayer) as a dependent if the existing dependency requirements are satisfied. The 2004 Act does not modify other requirements of each tax benefit or the rules for determining whether individuals other than children of the taxpayer qualify for each tax benefit.

Under the uniform definition a child is a "qualifying child" of a taxpayer if the child satisfies each of three tests: (1) the child has the same principal place of abode as the taxpayer for more than one half the taxable year. It is intended that, as is the case under existing law, temporary absences due to special circumstances, including absences due to illness, education, business, vacation, or military service, are not treated as absences; (2) the child has a specified relationship to the taxpayer. In order to be a qualifying child, the child must be the taxpayer’s son, daughter, stepson, stepdaughter, brother, sister, stepbrother, stepsister, or a descendant of any those individuals. (IRC § 152(c)) An individual who is legally adopted by the taxpayer, or an individual who is lawfully placed with the taxpayer for legal adoption by the taxpayer is treated as a child of the taxpayer by blood. A foster child who is placed with the taxpayer by an authorized placement agency or by judgment, decree, or other order of any court of competent jurisdiction is treated as the taxpayer’s child; ( IRC § 152(f)) and (3) the child has not yet attained a specified age. Under the 2004 Act, the age test varies depending upon the tax benefit involved. In general, a child must be under the age of 19, or under the age of 24 in the case of a full-time student, in order to be a qualifying child. No age limit applies with respect to individuals who are totally and permanently disabled within the meaning of IRC Section 22(e)(3) at any time during the calendar year . The 2004 Act retains the existing requirements that a child must be under age 13 (if he or she is not disabled) for purposes of the dependent care credit, and under the age of 17 (whether or not disabled) for purposes of the child credit.

Children Who Support Themselves

Under the 2004 Act, a child who provides over one half of his or her own support is not considered a qualifying child of another taxpayer. The 2004 Act retains the existing rule that a child who provides over one half of his or her own support may constitute a qualifying child of another taxpayer for purposes of the earned income credit.

Special Rule

If more than one taxpayer claims a child as a qualifying child a special rule applies (IRC§ 152(c)(4)) and the existing support and gross income tests for determining whether an individual is a dependent do not apply to a child who meets the requirements of the uniform definition of qualifying child.

If a child would be a qualifying child with respect to more than one individual (e.g., a child lives with his or her father and grandfather in the same residence) and more than one person claims a benefit with respect to that child, then the following rules apply. If only one of the individuals claiming the child as a qualifying child is the child’s parent, the child is deemed the qualifying child of the parent. If both parents claim the child and the parents do not file a joint return, then the child is deemed a qualifying child first with respect to the parent with whom the child resides for the longest period of time, and second with respect to the parent with the highest adjusted gross income. If the child’s parents do not claim the child, then the child is deemed a qualifying child with respect to the claimant with the highest adjusted gross income.

Effect Upon Existing Rules

Taxpayers may claim an individual who does not meet the uniform definition of qualifying child with respect to any taxpayer as a dependent if the existing dependency requirements (including the gross income and support tests) are satisfied. Individuals who satisfy the existing dependency tests and who are not qualifying children are referred to as "qualifying relatives" under the 2004 Act.

Thus, for example, under the 2004 Act, a grandparent may claim a dependency exemption with respect to a grandson who does not reside with any taxpayer for over one half the year, if the grandparent provides more than one half of the support of the grandson and the grandson’s gross income is less than the exemption amount.

Citizenship and Residency Requirements

Children who are U.S. citizens living abroad or non-U.S. citizens living in Canada or Mexico may qualify as a qualifying child, as is the case under the existing-law dependency tests. A legally adopted child who does not satisfy the residency or citizenship requirement may nevertheless qualify as a qualifying child (provided other applicable requirements are met) if the child’s principal place of abode is the taxpayer’s home, and the taxpayer is a citizen or national of the United States.

Children of Divorced or Legally Separated Parents

The 2004 Act retains the existing rule that allows a custodial parent to release the claim to a dependency exemption to a noncustodial parent. (IRC § 152(e)(1), (2)) Under the 2004 Act, as under existing law, the custodial waiver rules do not affect eligibility with respect to children of divorced or legally separated parents (IRC § 21(e)(5)) for purposes of the dependent care credit. (IRC § 2(b)(1)(A)(I)) The definition of "qualifying child" is made without regard to the waiver provision. (See IRC §§ 2(b)(1)(A)(i) and 32(c)(3)(A), as amended by the Act, and IRC § 21(e)(5)). Thus, as under existing law, a waiver that applies for the dependency exemption will also apply for the child credit, and the waiver will not apply for purposes of the other provisions. (IRC §§ 24(c), 152(e))

  

     In Holder v Holder, 392 F.3d 1009 (9th Cir. 2004) Jeremiah Holder appealed from the district court's order dismissing his petition for the return of his children to Germany. Jeremiah was stationed at Sembach Air Force Base in Germany. He was accompanied by his wife, Carla, and their two children. The Holders were in Germany for only eight months in 1999 and early 2000 before Carla returned to the United States with the children. Soon after Carla's return, Jeremiah filed for divorce and filed a petition under the Convention in federal court alleging that Carla had wrongfully retained the children. Jeremiah visited the children in the United States and, in violation of a California court order, took the children back to Germany in early 2002. Ultimately, he agreed to return the children to Carla in Seattle. Jeremiah  pled nolo contendere to a misdemeanor charge and was prohibited from seeing or talking with the children until 2005 without further court order. Although Jeremiah later moved temporarily to the Seattle area, he returned to Germany. The Ninth Circuit held that inn order to acquire a new habitual residence, there must be a "settled intention to abandon the one left behind." This is a question of fact to which this court grants deference to the district court. There must also be an "actual 'change in geography,' combined with the "passage of 'an appreciable period of time. This period of time must be "sufficient for acclimatization." In applying this framework, the court stated that it is keenly aware of the flexible, fact-specific nature of the habitual residence inquiry envisioned by the Convention. In light of the parents' failure to share a settled intention to abandon the United States as the children's habitual residence and the children's lack of acclimatization to the family's new location, the district court did not err in concluding that the children's habitual residence remained the United States throughout their time in Germany. Carla's retention of the children was therefore not wrongful under the Convention. The court also held that the district court did not err in turning to a magistrate judge to facilitate the proceedings. Other courts have similarly looked to magistrate judges in handling Convention petitions. (Read Comprehensive Discussion of Case)

          In Matter of D’Esposito v Kepler, 88 N.Y.S.2d 169, (2d Dept,2005) the Appellate Division held that the Family Court improvidently exercised its discretion in admitting into evidence the report of the neutral forensic psychologist, since the report was not submitted under oath (citing 22 NYCRR 202.16[g][2] ) and relied on information other than that upon which an expert may properly base an opinion. Nevertheless, even without considering the experts report and testimony, it found that Family Court providently exercised its discretion in requiring that the residence of the subject child, who had been relocated by the appellant to California, be returned to New York by the mother. The fact that the respondent's paternity was not established until after the relocation did not affect the require the court to apply the rule applicable to an initial custody determination. It held that the standard to be applied was the Tropea standard, which requires consideration of "all of the factors that may be relevant to the determination" as to whether the "proposed relocation would serve the child's best interests" (citing Matter of Tropea v. Tropea, 87 N.Y.2d 727, 642 N.Y.S.2d 575).

     In Bartha v. Bartha, NYLJ , January 31, 2005 (1st Dept.,2005) the parties married in 1977. The Appellate Division held that Plaintiff's proof established that defendant had engaged in a course of conduct which was harmful to the plaintiff's physical and mental health, thus rendering cohabitation unsafe or improper. Defendant intentionally traumatized plaintiff, a woman of Jewish origin born in Nazi-occupied Holland, with swastika-adorned articles and notes affixed around their home, and became enraged when she removed them. He ignored her need for support and assistance while she was undergoing surgery and treatment for breast cancer. He systematically cut off her access to marital funds and credit as a means of psychological abuse. Plaintiff's assertion that defendant completely ceased speaking to her was not benign when understood in the context of the prior years' verbal abuse. Physical violence is not a prerequisite for a showing that plaintiff's physical or mental well being rendered it unsafe or improper for her to continue cohabiting with defendant, nor did plaintiff need an expert to prove that defendant's actions had the claimed effect on her mental condition, particularly in view of her explanation that she was the type of person who found it difficult to consider seeking psychological treatment. A townhouse located on East 62nd Street was purchased in 1980 for $395,000, with cash totaling $199,699 obtained from a variety of sources, including a check from defendant's parents and a payment of separate funds belonging to plaintiff; the seller took back a mortgage for the remainder. The Appellate Division held that it was error to accept at face value the claim that initially placing the townhouse in the names of defendant's parents, and defendant's subsequently holding joint title with his mother, rendered the property non-marital. Defendant's parents who took title to the townhouse when it was purchased in 1980, and defendant's father thereafter purported to gift his half of the house to defendant, while the other half remained in his mother's name, until at her death in 1997, when defendant inherited 50 percent of her interest in the property, with the remainder willed to her granddaughters, the parties' children. The names in whom title was placed does not end the analysis. It is central to the Equitable Distribution Law that the term "marital property" includes property acquired by either spouse during the marriage "regardless of the form in which title is held" (Domestic Relations Law §236B[1][c]). That one of the spouses acquired title to property jointly with another relative would not necessarily interfere with its being considered marital, at least to the extent of the spouse's established interest. The manner in which defendant's parents initially obtained title, and defendant then obtained title from his parents, supported the claim that the townhouse was truly the marital property of these parties, at least in part, from the outset, and that any additional interest that defendant acquired from his parents subsequently might similarly be considered marital property as well. (Read Comprehensive Discussion of Case)

Be Sure to Submit a Complete Record on Appeal!

     In Fernald v Vinci, 786 N.Y.S.2d 211, 2004 WL 2801152 (N.Y.A.D. 2 Dept.) the mother appealed from order of the Supreme Court which denied her motion to vacate her default in opposing the father's motion for unpaid child support. The Appellate Division held that plaintiff failed to submit complete and proper record and dismissed the appeal. It stated: " "It is the obligation of the appellant to assemble a proper record on appeal ... An appellant's record on appeal must contain all of the relevant papers before the Supreme Court ... Appeals that are not based upon complete and proper records must be dismissed" (Garnerville Holding Co. v. IMC Mgt., 299 A.D.2d 450, 749 N.Y.S.2d 892 [internal citations and quotations marks omitted] ). The appellant failed to submit a complete and proper record to this court. The record filed omitted the defendant's papers submitted in opposition to the appellant's motion to vacate her default in opposing the motion for unpaid child support and omitted the papers submitted on the defendant's cross motion for an award of an attorney's fee (see CPLR 5526). Accordingly, the appeal must be dismissed...."

Watch out for Bad Language in Court!

     In Matter of Kondratyeva v Yapi, 2004 WL 2800286 (N.Y.A.D. 2 Dept.)) the Appellate Division dismissed appeals from a custody order and order of protection, as they were entered upon the father's default. It held that the Family Court properly found that the father's disruptive behavior in the courtroom was sufficient to constitute a default (citing Matter of McConnell v. Montagriff, 233 A.D.2d 512, 650 N.Y.S.2d 768). No appeal lies from an order made upon the default of the appealing party (see CPLR 5511). The proper procedure was to move to vacate the default and, if necessary, appeal from the denial of the motion to vacate.

Don't forget the Net Worth Statement!

     In Matter of Fischer-Holland v Walker, 12 A.D.3d 671, 784 N.Y.S.2d 890 (2d Dept.,2004) a child custody proceeding, Family court granted the fathers motion for an award of an attorney's fee, and after a hearing, awarded the father an attorney's fee in the sum of $27,460. The Appellate Division reversed on the law and as a matter of discretion, without costs or disbursements, and the motion was denied without prejudice to renewal upon compliance with the provisions of 22 NYCRR 202.16(k). The Court stated: "The father's motion for an award of an attorney's fee pursuant to Domestic Relations Law 237 did not include the required statement of net worth (see 22 NYCRR 202.16[k][2] ). Under these circumstances, the Family Court improvidently exercised its discretion in granting the motion (see Cole v. Cole, 283 A.D.2d 602, 724 N.Y.S.2d 911; George v. George, 192 A.D.2d 693, 694, 597 N.Y.S.2d 129; Lazich v. Lazich, 189 A.D.2d 750, 752, 592 N.Y.S.2d 415; Koch v. Koch, 134 A.D.2d 574, 521 N.Y.S.2d 474). The proper course would have been for the Family Court to decline to hear the motion (see 22 NYCRR 202.16[k][2] ), or to deny it without prejudice to renewal upon compliance with the applicable requirements (see 22 NYCRR 202.16[k][5] [ii] ).

Tell Your Clients About the Single Action Rule!

     In Chen v Fischer, 12 A.D.3d 43, 783 N.Y.S.2d 394, the Appellate Division, Second Department, adopted a "single action rule" requiring the resolution of all issues relating to the marriage relationship in the single action, holding that interspousal tort actions commenced subsequent to and separate from an action for divorce, are precluded by the doctrine of res judicata or claim preclusion, on the theory that the issues could have been litigated in the prior divorce action between the parties. The decision is a logical and needed extension of the public policy enunciated by the Court of Appeals in Boronow v. Boronow, 71 N.Y.2d 284, 286, 525 N.Y.S.2d 179, 519 N.E.2d 1375. There, the Court of Appeals held that a party to a concluded matrimonial action, who had a full and fair opportunity to contest title to the former marital home, was barred by res judicata principles from subsequently and separately reopening that issue. The Boronow decision was based on the policy that the courts and the parties should ordinarily be able to plan for the resolution of all issues relating to the marriage relationship and the end of the marriage relationship in a single divorce action. The Second Department, in Chen, stated that "Societal needs, logic, and the desirability of bringing spousal litigation to finality" compelled it to expand upon the rule".

      In K v. B, 2004 WL 2525121, 2004 NY Slip Op 08003 (N.Y.A.D. 1 Dept., Nov 09, 2004) the husband argued on appeal that the wife "could not establish cruel and inhuman treatment as a ground for divorce since the parties did not cohabit." The Appellate Court affirmed the divorce stating that in determining whether cruel and inhuman treatment occurred, "the fact-finder should focus primary attention on the nature of the interaction between a husband and wife, rather than on the type of living arrangement." Supreme Court found sufficient proof that the husband committed "marital rape" more than once; wiretapped and monitored the wife's telephone conversations without her knowledge; accused the wife of adultery; threatened to ruin the wife's business; refused to discuss his finances with the wife, some of which involved projects which the wife was financing; engaged in "various financial maneuvers" which involved "surreptitiously" withdrawing money from joint accounts, selling stock and liquidating assets, including taking for his own benefit a $35,000 federal income tax refund check; suggested to the wife that she was mentally unstable and incapable of making decisions; wrote a "manipulative and intimidating" letter to the wife's therapist; engaged in a pattern of anger followed by withdrawal when the wife wanted to talk about her feelings concerning the parties' marriage and family; continually gave the wife "mean and frightening" stares; yelled at the wife, demeaned her and berated the wife when she tried to discuss serious issues with him; engaged in a long pattern of intimidation; and that when the wife was feeling "pressured" by her mounting, severe business problems, the husband remained upstate, refusing to spend any more time in New York City with her and their three children, despite her repeated requests. The Appellate Division affirmed the Supreme Court’s distribution of the marital property 65% -35% in the wife's favor, the finding that the wife's law firm had no value, and finding the husband 50 percent responsible for those debts of the wife's business for which she may be held personally liable. It held that the distribution of marital assets depends not only on the financial contribution of the parties "but also on a wide range of nonremunerated services to the joint enterprise, such as homemaking, raising children and providing the emotional and moral support necessary to sustain the other spouse in coping with the vicissitudes of life outside the home. Here, the evidence was abundant that the wife contributed significantly in every single category, and the husband hardly at all. It affirmed the trial court's unequal distribution of marital property, as amply supported by the record, even were it not to consider any economic fault ((see Domestic Relations Law §236B[5][d][11] and §236B[5][d][13]). The evidence established that the wife undertook the herculean combined roles of full-time lawyer, primary homemaker and mother, with little help from the husband. (Read Comprehensive Discussion of Case)     

In Whiting v Krassner, ___F3d___, No. 03-1276 ( 3rd Cir, 2004) Whiting brought an action under the Hague Convention for the return of her daughter, Christina, to Canada. Christina had been taken by Krassner, her father, to the United States without her consent. The District Court determined that Christina’s place of habitual residence at the time of her removal from Whitings custody was Canada, and ordered that Christina be returned to her in Canada. The Third Circuit Court of Appeals, focusing on the settled purpose and shared intent of the parents of a very young child, a test it established in Feder v. Evans-Feder, 63 F.3d 217(3d Cir. 1995) and Delvoye v. Lee, 329 F.3d 330 (3d Cir. 2003), affirmed, holding that the District Court properly found that the child’s habitual residence was Canada. It also held that the appeal was not rendered moot by virtue of the child’s return to Canada during the pendency of the appeal, rejecting the rationale of the Eleventh Circuit in Bekier v. Bekier, 248 F.3d 1051 (11th Cir. 2001), and adopting the rationale of the Fourth Circuit in Fawcett v. McRoberts, 326 F.3d 491(4th Cir. 2003). (Read Comprehensive Discussion of Case.)

In Sealed Appellant v Sealed Appellee --- F.3d —, 2004 WL 2915345 (5th Cir.(Tex.)) the father of two Australian-born children petitioned for their return to Australia under the Hague Convention on the Civil Aspects of International Child Abduction. The District Court denied the petition holding that he was not exercising custody rights at the time of their removal. The Court of Appeals adopted the reasoning from Friedrich II and held that in the absence of a ruling from a court in the child's country of habitual residence, when a parent has custody rights under the laws of that country, even occasional contact with the child constitutes "exercise" of those rights. To show failure to exercise custody rights, the removing parent must show the other parent has abandoned the child. It held that under the law of Australia, the children's country of habitual residence, the father was "exercising" his rights of custody when the mother removed the children. It also held that no custody suit need be pending for the mother's removal to be wrongful under the Convention. (Read Comprehensive Discussion of Case.)

In Stocker v. Sheehan, 2004 WL 2386456 (N.Y.A.D. 1 Dept.) the parties were divorced in July 1994 in Rhode Island after a trial which awarded the parties joint custody of the child. Subsequently, the judgment was modified to permit the mother to relocate to New York with the child, but required her to transport the child to Rhode Island, where the father continued to reside, for visitation. The order provided, "The State of Rhode Island shall retain jurisdiction and is declared to be the 'home state' as to any decision concerning custody, visitation and child support, and shall be in accordance with provisions of the Rhode Island Uniform Child Custody Jurisdiction Act, General Laws of Rhode Island, 1956, as amended 15- 14-1 through 26." The parties substantially adhered to these provisions from November 1994 to the present. The mother commenced a proceeding in September 2003 in Supreme Court, New York County for an order "modifying the extraordinary visitation schedule entered almost nine years ago; and modifying and enforcing the child support provisions established pursuant to the parties' divorce over nine years ago." The Appellate Division held that New York lacked subject matter jurisdiction to determine the subject custody/ visitation issue despite the fact that the child was and had been for the past nine years a resident of New York. Under New York's Domestic Relations Law 76-b, which is part of the New York version of UCCJEA, and given the father's residency in Rhode Island, Rhode Island must first decline jurisdiction since a court of this state may not modify a child custody determination made by a court of another state "unless .. [t]he court of the other state determines it no longer has exclusive, continuing jurisdiction ... or that a court of this state would be a more convenient forum ...". It is for the Rhode Island court, not a New York court, to decide the issue of whether Rhode Island has "exclusive, continuing jurisdiction" since it is a condition to New York's exercise of jurisdiction to modify a child custody determination made by a court of another state that "[t]he court of the other state determines it no longer has exclusive, continuing jurisdiction". The Appellate Division also held that Supreme Court also erred in exercising jurisdiction over the child support provisions of the 1994 Rhode Island judgment of divorce, which, in light of the State's adoption of the Uniform Interstate Family Support Act [UIFSA] (Family Court Act 580-205[d] ), was prohibited by the exclusive, continuing jurisdiction of the Rhode Island court. UIFSA requires recognition of Rhode Island's exclusive, continuing jurisdiction with respect to child support under the 1994 judgment, given the father's continuing residence there and the absence of the consent of the parties to a change. (Read Comprehensive Discussion of Case)

In Tenorio Ruiz v Tenorio, 388 F.3d 784, 17 Fla. L. Weekly Fed. C 1161, 17 Fla. L. Weekly Fed. C 1173 (11th Cir.) the action, dealing with habitual residency under the Hague Convention on the Civil Aspects of International Child Abduction, presented two issues of first impression in the 11th Circuit, the standard of review and the definition of "habitual residency". The Mexican father of children born in the United States and living in Mexico filed a petition in the United States District Court for the Middle District of Florida claiming "wrongful removal" after the American mother moved with the children from Mexico to Florida. The District Court denied the petition on the grounds that the "habitual residence" of the children was in the United States. The Court of Appeals affirmed. It held that a mixed standard of review is appropriate for determining the issue of child's habitual residency in appeals involving wrongful removal petitions brought under the International Child Abduction Remedies Act (ICARA). It also held that the opinion in Mozes v. Mozes, 239 F.3d 1067, 1074 (9th Cir.2001), by Judge Kozinski sets out the most appropriate approach to determining "habitual residence", and that the father failed to prove that the children's prior United States habitual residence had been abandoned and a new habitual residence in Mexico established when they moved to Mexico.   (Read Comprehensive Discussion of Case)    

This decision was withdrawn on December 7, 2004 and a new decision rendered.  See 392 F.3d 1247. A few of the factual findings were changed but otherwise it is  identical to the original decision.

In Miklos v Miklos, 9 A.D.3d 397, 780 N.Y.S.2d 622 (2d Dept., 2004) the Second Department held that while the Supreme Court providently exercised its discretion in denying pre-judgment interest on the plaintiff's distributive award, the plaintiff was entitled to interest on the distributive award from the date of entry of the judgment of divorce to the date of final payment.

In Matter of McColl v McColl, 6 A.D.3d 794, 774 N.Y.S.2d 586 (3d Dept.,2004) the Appellate Division held that the judgment of divorce was deficient because it failed to set forth Supreme Court's reasons for accepting the parties agreement containing a deviation from the child support guidelines--a requirement that is 'unbending [and] cannot be waived by either party or counsel'. This defect rendered "the judgment * * * ineffective to the extent that it purports to incorporate the child support provisions of the parties' agreement" and permitted the court to consider the law applicable to modification of a child support award where there is no surviving agreement.

In Matter of Plovnick v. Klinger,  2003 WL 23695381 (N.Y.A.D. 2 Dept.), a custody case, the Appellate Division, Second Department, held that Family Court may depart from the public payment scheme for assigned law guardians which is established by the Judiciary Law and that where parent’s have sufficient means they may be directed to pay such fees. It noted that where the court has elected to exercise its authority to direct one or both parents to pay the law guardian's fees, it may establish a reasonable hourly fee which exceeds the statutory rates set forth for the representation of indigent parties in Judiciary Law 35(3). However, if a parent who has been directed to pay a fee contests a law guardian's claims relative to the time expended and the reasonable value of the services provided, he or she should be afforded a hearing on this issue. The decision conflicts with the Fourth Department decision In Re Lynda A.H. v. Diane T.O., 243 A.D.2d 24., which held that because family courts are courts of limited jurisdiction, their ability to award compensation is capped by the Judiciary Law, and that the fees of Law Guardians should be paid pursuant to the provisions of the Judiciary Law.

In Schantz v O'Sullivan, #94288, the Appellate Division, Third Department, held that Chapter 71 of the Laws of 2000, which prohibits attorneys from foreclosing on mortgages obtained from matrimonial clients impaired contractual rights and therefore violated the Contract Clause of the United States Constitution.

In Frankel v Frankel, __NY 2d __ , No. 100 (June 29, 2004) the Court of Appeals held that a divorce lawyer discharged without cause by one spouse can still make an application for counsel fees against the other spouse pursuant to Domestic Relations Law §237(a) after the discharge. The wife retained a law firm which represented her in the parties divorce action for more than three years. She then fired her attorneys and hired different counsel, who negotiated a settlement with the husband, which stipulated that each side would be responsible for its own legal fees. The wife’s former attorneys, owed some $94,000, moved under §237(a) for a counsel fee award from the husband. The Second Department held that the Domestic Relations Law was drafted to protect the non-monied client, not the non-monied client's former lawyer. It held that the statute applies only to the current attorney of record and that "former counsel has no standing to pursue the adversary spouse within the matrimonial action" (309 AD2d 65, 69 [2d Dept 2002]). The Court of Appeals reversed. Judge Albert M. Rosenblatt, writing for the Court, said a decision to the contrary would undermine public policy and legislative intent by giving the more affluent spouse an upper hand. He pointed out that Domestic Relations Law § 237 (a) provides, in pertinent part, that "[i]n any action or proceeding ... for a divorce ... the court may direct either spouse ... to pay such sum or sums of money directly to the attorney of the other spouse to carry on or defend the action or proceeding as, in the court's discretion, justice requires, having regard to the circumstances of the case and of the respective parties." The statute goes on to say that "[a]ny applications for counsel fees and expenses may be maintained by the attorney for either spouse in counsel's own name in the same proceeding." Although the provision is silent as to whether an attorney who has been discharged without cause has the right in the same proceeding to seek counsel fees, reading the provision in light of precedents and the policy interests surrounding the statute, the Court held that Domestic Relations Law § 237 (a) allows an attorney who was discharged without cause to proceed against the other spouse in the matrimonial litigation. (Read the opinion)

In Holterman v Holterman, No. 73, (June 10, 2004) the New York Court of Appeals, in a 5-2 opinion, held that the Supreme Court did not err by declining to adjust defendant’s child support obligation to account for the distributive award payments he was obligated to pay plaintiff for her share of the future enhanced earnings attributable to his medical license. The majority, in an opinion by Judge Graffeo, agreed with the Appellate Division, and found no statutory authority for deducting enhanced earning contributions from the child support calculus. The opinion held that "... the husband's proposed reallocation formula -- or any formula that requires a deduction of a distributive award paid over a period of years from the licensed spouse's income for purposes of calculating child support -- is impermissible under the CSSA," the Child Support Standards Act. Judge Graffeo wrote. "Had the Legislature intended to make distributive awards deductible from one parent's income and includable in the other's, it could easily have so provided." Notably, the Court agreed with husband that a distributive award to be paid by one parent to the other pertains to the financial resources of the parties and is an appropriate paragraph (f) factor that the trial court may consider, in determining whether the application of the child support guidelines amount is "unjust or inappropriate" when awarding child support. Here, in determining whether to apply the child support percentage of 25% to all income in excess of $80,000, Supreme Court expressly indicated that it considered the distributive award and maintenance obligations, the substantial disparity in gross income between the parties, as well as the upper middle-class lifestyle the children would have enjoyed had the parties not divorced. The family had taken frequent vacations, the children received allowances and engaged in extracurricular pursuits, and the daughter, who is musically talented, had taken private music lessons and had traveled with the Empire State Youth Orchestra. Under these circumstances, The Court could not say Supreme Court abused its discretion by applying the statutory percentage of 25% to husband’s income in excess of $80,000. Judge Robert S. Smith dissented in an opinion with Judge Susan Phillips Read. He said :"It makes no sense at all to calculate child support as if no such distribution had occurred -- as though the transferring spouse still owned the asset and received the income it generated," *** "Yet the majority concludes that this irrational procedure is required by the CSSA -- as indeed it would be, except that the CSSA expressly permits departure from its formula to avoid an 'unjust or inappropriate' result." (Read the opinion)

In Wilson v McGlinchey, No. 57 (May 13, 2004) the Court of Appeals affirmed an order which granted the parents' request to terminate grandparents visitation based on a change in circumstances, because it agreed with the Appellate Division that terminating visitation was in the child's best interest. Judge Graffeo, writing for the Court, stated that although there are benefits which devolve upon the grandchild from grandparent visitation, which cannot be derived from any other relationship, that interest must yield where the circumstances of the child's family including the worsening relations between the litigants and the strenuous objection to grandparent visitation by both parents render the continuation of visitation with the grandparents not in the child's best interest. The Court noted that in light of its ruling it did not address the Petitioners' argument challenging the constitutionality of Domestic Relations Law § 72.

In Matter of Auclair v. Bolderson, __AD2d__, ,775 N.Y.S.2d 121 (3d Dept.,2004) the parties 1987 Florida divorce judgment granted petitioner custody of the parties' two children and ordered that respondent pay child support of $200 per month per child until the children reached 18. During the divorce proceedings, petitioner and the children moved to New York. Respondent moved to Missouri after the divorce. The Appellate Division held that this state's courts lack subject matter jurisdiction to modify the Florida judgment by operation of the Federal Full Faith and Credit for Child Support Orders Act (FFCCSOA) (see 28 USC 1738B) and the Uniform Interstate Family Support Act (UIFSA) (see Family Ct. Act 580-101 et seq.).  Both FFCCSOA and UIFSA grant "continuing, exclusive jurisdiction over" a child support order to the state that issued the order The issuing state loses such jurisdiction where, as here, none of the parties or children continues to reside in that state . The issuing state will also be deprived of continuing, exclusive jurisdiction when all parties file written consents that allow another state to assume continuing, exclusive jurisdiction over the order. The absence of such continuing, exclusive jurisdiction, however, while an essential prerequisite, does not, by itself, confer upon another state the power to modify the child support order. If no written consent to the change in jurisdiction has been filed, FFCCSOA requires that the modifying state have personal jurisdiction over the nonmoving party. Additionally, the party or support enforcement agency seeking to modify, or to modify and enforce [the initial order must] register that order" with the modifying state. UIFSA also requires that the initial child support order be registered in the modifying state. UIFSA then confers subject matter jurisdiction upon the modifying state if the issuing state was deprived of continuing, exclusive jurisdiction by virtue of the written consent of the parties. If no such consent exists, however, UIFSA requires that: (1) none of the parties or children continues to reside in the issuing state; (2) the party seeking modification is not a resident of the modifying state; and (3) the nonmoving party is subject to personal jurisdiction in the modifying state. Pursuant to UIFSA and FFCCSOA, Florida lost "continuing, exclusive jurisdiction" over its judgment by virtue of the fact that neither the parties nor the children continued to reside there. As such, the courts of a nonissuing state may modify the judgment if it has been registered in that state and certain other criteria have been met. Here, petitioner failed to demonstrate that the Florida judgment was registered in New York. In itself, this failure to prove registration prevented New York courts from obtaining subject matter jurisdiction under both UIFSA and FFCCSOA . Additionally, because petitioner and the children were residents of New York, "all of the parties [must] have filed written consents [in the Florida court to allow New York courts] to modify the support order and assume continuing,
exclusive jurisdiction over the order" under UIFSA There was no indication the parties had filed any documents in the Florida Circuit Court consenting to New York's jurisdiction.

Divorce Your Parents -- The Daily Legal Newswire, Thursday, April 29, 2004, published on the web by the editors of American Lawyer Media's at http://www.law.com/newswire/, reported that a 14-year-old boy whose mother was killed by his father is going to trial to sever paternal ties, after a family court judge in Ohio reversed his own earlier decision and agreed to let the case proceed. The father is serving a life sentence in prison, but wants access to information about his son's life. It pointed out that if successful, Patrick Holland would become the first child in the United States to divorce a parent. Patrick, who was 8 at the time of his mother's death, discovered her body after the murder. (Wasn't there a movie about this already?)

On the Horizon: New Jersey and Florida retreat on Grandparent Visitation rights. Is New York State next?

In Moriarty v Bradt, 177 N.J. 84, 827 A.2d 203 (2003) the New Jersey Supreme Court held that because the New Jersey Grandparent Visitation Statute is an incursion on a fundamental right (the right to parental autonomy), it is subject to strict scrutiny and must be narrowly tailored to advance a compelling state interest. The only state interest warranting the invocation of the State's parens patriae jurisdiction to overcome the presumption in favor of a parent's decision and to force grandparent visitation over the wishes of a fit parent is the avoidance of harm to the child. In every case in which visitation is denied, the grandparents bear the burden of establishing by a preponderance of the evidence that visitation is necessary to avoid harm to the child.

In Sullivan v Sapp, 2004 WL 62845 (Fla.) the maternal grandmother filed a motion to intervene in a paternity action and sought an award of visitation, after the child's mother was killed in a car accident while the mother's motion for rehearing was pending. The Florida Supreme Court held that the Florida grandparent visitation statute, which allows the court to grant a grandparent visitation rights if it is in child's best interest, without requiring a showing of harm to child as result of lack of grandparent visitation, impermissibly infringes on a parent's state constitutional privacy right to raise his or her child and is unconstitutional.

Grandparents given "custody rights".  New York’s Domestic Relations Law was amended effective January 5, 2004 to give the grandparent or the grandparents of a child residing in New York state custody rights where the grandparent or grandparents can demonstrate the existence of "extraordinary circumstances". An "extended disruption of custody" constitutes an extraordinary circumstance. "Extended disruption of custody" is defined to include a prolonged separation of the respondent parent and the child for at least twenty-four continuous months during which the parent voluntarily relinquished care and control of the child and the child resided in the household of the petitioner grandparent or grandparents. The court may find that extraordinary circumstances exist where the prolonged separation has lasted for less than twenty-four months, and based upon other circumstances. (DRL § 72 , subdivision 2 as added by L.2003, c. 657, § 2, eff. Jan. 5, 2004.)

In Vernon v. Vernon, ___NY2d___ (2003) the Court of Appeals affirmed New York's continuing jurisdiction over custody of the parties child even though the mother and child were living in Wyoming since 1992. The parties 1992 agreement provided that the mother would have sole custody of the parties 2_year_old daughter and that the New York Supreme Court would retain personal jurisdiction over all future disputes as long as one of the parties remained in this state. The mother moved with the child to Wyoming. The former husband, who remained in New York state, brought a motion in Supreme Court for sole custody on the grounds that his former wife had relocated in an effort to deprive him of contact with their daughter. The mother responded with an action in Wyoming. After the Supreme Court refused to cede up jurisdiction, the parties stipulated that the child would remain with the wife and the former husband was given more liberal visitation. After his attempts to maintain contact with his child were repeatedly frustrated he again sought sole custody in the Supreme Court. Mrs. Vernon refused to acknowledge the New York court, was held in contempt and lost custody. The Appellate Division, First Department, rejected her argument that the Parental Kidnapping Prevention Act preempted the New York Domestic Relations Law. The Court of Appeals unanimously affirmed, finding that New York could retain continuing jurisdiction. Judge George Bundy Smith, writing for the Court, held that ceding jurisdiction would play directly into the hands of parents who abduct or abscond with their children, "the very antithesis of the statutory" objective of New York's Domestic Relations Law. The Court held that the substantial connection test applies even though the child is not currently a resident of New York and has not lived full time in the state for more than a decade. Judge Smith noted that the child was born in New York, lived in New York for her first year, has a half sister and other relatives in New York and has spent summers and holidays in New York. New York courts were in the child's life since she was a toddler.

 

In Robinson v Robinson, ___AD2d___, 2003 WL 22100682 (N.Y.A.D. 1 Dept.)) the Appellate Division reversed an order which had granted the wife’s motion for a protective order prohibiting the introduction of her diary into evidence at trial on the husband's direct case for the truth of the statements contained therein, but allowed its use to impeach her credibility. It held that although plaintiff did not obtain defendant's diary through proper means, the diary was not privileged and plaintiff would have been entitled to its production in the ordinary course of discovery. Accordingly, suppression of the diary pursuant to CPLR 3103(c) was not warranted.

In Frankel v Frankel, ___AD2d___,2003 WL 32163062 (N.Y.A.D. 2 Dept.)) the Appellate division held that former counsel for a spouse in a matrimonial action may not apply in their own name within that action, against the adversary spouse, for fees for legal services previously rendered after he has been discharged. Former counsel represented the wife through over 30 days of the child custody phase of the parties' trial. The trial court ordered the husband to pay the wife's counsel $25,000 in pendente lite attorney's fees. Shortly thereafter, the wife discharged her attorneys. The wife's former counsel moved in this action against the husband to recover over $94,000 in fees, for services rendered to the wife. The Supreme Court granted the motion to the extent of holding that the wife's former counsel could maintain the application for an attorney's fee against the husband, and referred the matter to a referee to hear and report on the amount of the fee payable by the husband. The Appellate Division reversed. It held that neither the statute (DRL 237) nor case law grants a discharged attorney the right to apply in his or her own name for retrospective fees against the adversary spouse, either within or without the matrimonial action.

In Eredics v. Chase Manhattan Bank, N.A., 2003 N.Y. Int. 62 (May 8, 2003) the Issue was whether a separation agreement entered into by the husband-depositor and wife-beneficiary waived the wife’s right to payment of funds from a Totten trust that had been established by the husband during the parties marriage. Plaintiff entered into a separation agreement with the defendant which provided that each party relinquishes any and all right to the estate of the other upon the latter's death. Her former husband died three years later, leaving his estate to his brother and sister. Plaintiff, who was named as the beneficiary of a Totten Trust, sought to recover the funds held in the trust established prior to the will. The Supreme Court held that the separation agreement was not a revocation of the Totten trust. The Appellate Division and Court of Appeals affirmed. The Court of Appeals explained that in Estates, Powers and Trusts Law, Section 7-5.2, three means are specified for a depositor's revocation of a Totten trust: withdrawal of the funds, an express direction in a will, or a qualifying writing filed with the bank. In this case, none of these means were employed. The Court held that a beneficiary may waive his or her right so long as the waiver is explicit, voluntary and made in good faith. Because the separation agreement did not explicitly address the Totten trust, Plaintiff never waived her right to its benefits.

   In Wisniewski v Cairo 759 N.Y.S.2d 798 in April 1999, the child support provision of parties separation agreement, drafted by plaintiff's attorney, stated "that under the Child Support Standards Act 17% of the combined annual parental income is designated for child support." It set forth that defendant earned approximately $75,000 per year and plaintiff had no earnings, and that under the CSSA defendant would be required to pay child support of $1,062.50 per month, but since the parties agreed that it was in the child's best interest "to provide the child with the same lifestyle as if the parties were still residing in the same household as a family unit," defendant agreed to pay child support of $3,000 per month. Defendant also agreed to assist in the payment of the child's college education and funded a college account with $53,000. Plaintiff obtained an uncontested divorce which incorporated the separation agreement by reference, without merger, into the judgment. When plaintiff sought to enforce the agreement Supreme Court found that the $3,000 support payment, amounting to 46% of defendant's gross income at the time of the agreement's execution and 40% of his then current income, was so severe a deviation from the child support guidelines as to be inequitable. It vacated the support provision and directed a de novo hearing. The Appellate Division affirmed noting that defendant's child support obligation under the agreement was nearly three times greater than what he would have paid under the applicable CSSA guidelines, based upon his 1998 income of $72,537.33, as calculated under the CSSA. The obligation represented approximately 65% of his net income at that time. Considering that fact, the minimal income left for defendant's living expenses and the distribution of marital assets in plaintiff's favor, it found the child support provision in this agreement manifestly unfair such that equity demands that it not be enforced. It deemed defendant's support obligation under the agreement unconscionable. and affirm Supreme Court's determination vacating it and cancelled his child support arrears.

    In Ahmad v Naviwala ___AD2d ___, (3d Dept.,2003) the parties, devout Muslims, agreed that the mother would maintain sole custody of her son until June 13, 2001 and of her daughters until January 1, 2002, at which point sole custody would be transferred to respondent. After the agreement was incorporated, but not merged, into their judgment of divorce, respondent took the children to Saudi Arabia for his three-month visitation. Petitioner was ultimately refused all contact with the children and was informed that they would not be returning. During the next two years the mother made continuing efforts to regain their custody but she was severely limited by respondent's subversive measures, cultural barriers and an inaccessibility to the Saudi legal system. In April 2002, she learned that respondent was planning a trip to Texas with the children and the children were seized pursuant to an order from the Family Court. At the custody modification hearings, respondent testified that he failed to abide by the negotiated agreement because petitioner failed to properly school the children. He contended that his new wife is equal to that of petitioner and that the children were thriving in the Muslim environment. He believed that petitioner should be allowed four weeks of visitation every two years. The children expressed their preference to live with respondent in Saudi Arabia and the Law Guardian mirrored their desire. Family Court granted custody to respondent. Recognizing that Saudi Arabia was not a signatory to the Hague Convention on the Civil Aspects of International Child Abduction and that there was no method by which petitioner could enforce her visitation rights while the children resided in that country, it imposed various conditions upon respondent.  The Appellate Division awarded custody to petitioner finding that respondent intended to permanently remove petitioner from the children's lives. In it’s view, Family Court failed to fully appreciate the magnitude of his actions. Despite the fact that the parties and children were American citizens he allegedly sought and obtained an ex parte custody order from an Islamic court and secreted the children from petitioner for almost two years, even when he traveled to the United States. Moreover, the safeguards put in place by Family Court to ensure petitioner's access to the children in Saudi Arabia were wholly insufficient.

       In Skiff-Murray v Murray, __AD2d___ 2003 WL 21027133 (N.Y.A.D. 3 Dept.) an action for a divorce, Family Court  imputed income to the husband totaling $93,000 and calculated his child support obligation at $1,875 per month.  On the parties cross-appeals, he moved to strike documents in an addendum to the wife's brief, which contained subsequent findings and orders in the proceeding indicating that he had refused to attend trial in the divorce action, voluntarily departed the state, and willfully disobeyed a child support order resulting in a bench warrant and order of commitment.  The wife moved to dismiss his appeal on the ground that his current status as a fugitive from the jurisdiction of the trial courts invoked the "fugitive disentitlement doctrine". The Appellate Division pointed out that the fugitive disentitlement doctrine permits a court to dismiss an appeal * * * if the party seeking relief is a fugitive while the matter is pending. The doctrine is based on the inherent power of courts to enforce their judgments. It noted that although no New York appellate court has adopted the fugitive disentitlement doctrine by name, the Appellate Division in each department and the Court of Appeals have dismissed fugitives' appeals in criminal proceedings on the comparable ground that "the appellant is not presently available to obey the mandate of the Court in the event of an affirmance".  The Court of Appeals and the First Department have also dismissed appeals in civil proceedings where the appellant was a fugitive who could not be compelled to obey the underlying court mandate because it was being both appealed and evaded at the same time.  In each of these cases, the doctrine's requirement for a sufficient nexus between the appeal and the appellant's fugitive status was satisfied because the appellant's absence frustrated the civil judgment.  On her cross motion the wife asserted, without opposition, that the husband willfully and deliberately removed himself from the jurisdiction of the New York courts by transferring his assets, leaving the state and failing to appear in proceedings to enforce a support order. The Appellate Division took judicial notice of the subsequent orders submitted by the wife to the extent that they established the husband's absence and default in Family Court proceedings involving the very order from which he sought relief on appeal. It found that he had willfully made himself unavailable to obey the mandate of the Family Court in the event of an affirmance, and granted granted the wife's motion for dismissal of his appeal on that ground.

     In Redgrave v Redgrave,___ AD2d___ ,___ NYS2d___, 5/9/2003 N.Y.L.J. 18, (col. 1) (3d Dept.,2003) the Supreme Court granted defendant's motion to dismiss the complaint at trial. Thereafter it granted defendant's application for counsel and expert fees. The Appellate Division rejected plaintiff's contention that Supreme Court lacked the jurisdiction to award the fees because the action was terminated by dismissal of the complaint prior to defendant's fee application. It held that in a divorce action, the court is authorized to direct a party to pay the counsel fees and expenses of the other spouse provided that direction is "made prior to final judgment" (citing Domestic Relations Law §237 [a]). That language has been interpreted to permit the court to direct payment of fees and expenses "at any time after the start of the action up through the entry of final judgment". Here, defendant made his application eight days after the oral dismissal of the complaint, which was several months prior to the entry of the final order dismissing the action, and under such circumstances, Supreme Court was authorized to entertain the application. However, the Appellate court agreed with plaintiff's argument that it was error for Supreme Court to award counsel and expert fees without a hearing in the absence of a stipulation consenting to a determination upon written submissions, despite her failure to request a hearing (citing Carlson-Subik v. Subik, 257 AD2d 859, 862; see also Matter of Flynn v. Rockwell, 295 AD2d 672, 675; Ott v. Ott, 266 AD2d 842; Stricos v. Stricos, 263 AD2d 659; Sim v. Sim, 248 AD2d 781, 781, 782). It made it clear that this was now the rule in the Third Department, stating that "[T]o the extent that other decisions of this Court have held to the contrary (see O'Connell v. O'Connell, 290 AD2d 774, lv granted 99 NY2d 503; Hapeman v. Hapeman, 229 AD2d 807; Gundlach v. Gundlach, 223 AD2d 942), they should no longer be followed."

       In Kellogg v Kellogg, ___AD2d___, 752 NYS2d 462, the Appellate Division , Fourth Department, held that it was proper for the family court "to use current figures for a tax year not yet completed to determine the father’s child support obligation", and affirmed an order reducing his child support obligation based upon the finding that his income in the year 2001 would be less than in the year 2000. The hearing was held during the first few weeks of the year 2001. It cited as authority Matter of Mercado, 241 AD2d 948, 661 NYS2d 323, a brief memorandum involving interpretation of a stipulation, which stated without discussion that "...nothing in the statute prohibits reliance upon partial information from a tax year not completed". (February 7, 2003 advance sheet)

     In Zielinski v Wayman, ___ AD2d___, 752 NYS2d 447, the Appellate Division, Third Department, revisited it’s holding in Matter of Hahn v Rychling, 258 AD2d 832, 686 NYS2d 136 which held that by virtue of the pre-emptive provisions of the Parental Kidnapping Prevention Act (28 USC 1738A) New York could not exercise jurisdiction in a child custody proceeding, where it had made a prior custody determination, where this state was no longer the "home state" of the child. It held that "a court in New York may exercise jurisdiction when New York has made a prior custody determination and the requirements of 28 USC §1738A(d) and Domestic Relations Law former § 75 -d(1)(b) have been met (i.e., New York remains the residence of the child or any contestant and it is in the best interest of the child that a court of this state assume jurisdiction). (February 7, 2003 advance sheet)     

        In Havell v. Islam __AD2d___, ____NYS2d___NYLJ, 12-18-02 ,the Appellate Division, First Department, affirmed a judgment of divorce which limited the husband's equitable distribution to 4.5% of the parties $13 million of marital assets and denied him an award of counsel fees. The parties were married for 21 years and had six children, Seven days after plaintiff told defendant that she would seek a divorce he entered her bedroom at 5 AM and when she awoke he pinned her to the bed and began beating her viciously on the head, face, neck and hands with the barbell. Plaintiff suffered, among other things, multiple contusions, a broken nose and jaw, broken teeth, multiple lacerations, and neurological damage. Defendant was indicted for attempted murder, pleaded guilty to assault in the first degree on August 11, 2000 and was sentenced subsequently to 8-1/4 years in prison. The trial court held that defendant's vicious assault on plaintiff was so egregious as to "shock the conscience". The Appellate Division noted that while the general rule in New York is that marital fault should not be considered in determining equitable distribution it may be taken into consideration where "the marital misconduct is so egregious or uncivilized as to bespeak of a blatant disregard of the marital relationship -- misconduct that 'shocks the conscience' of the court thereby compelling it to invoke its equitable power to do justice between the parties". It held that conduct is conscience-shocking, evil, or outrageous only when the act in question grievously injures some highly valued social principle, such as human life. (Text of the opinion)

           In Cozza v. Colangelo, _______ A.D.2d _______. 747 N.Y.S.2d 641 (4th Dept. 2002) the Fourth Department held that the plaintiff's previously dismissed divorce action did not constitute a 'matrimonial action' for purposes of equitable distribution. Such an action falls outside the meaning of both DRL 236(B)(1)(c) and DRL 236(B)(4)(b) because it neither ended the marriage nor resulted in equitable distribution of the parties' property.  The court adopted the rule of the Third Department expressed in McAteer v. McAteer, 294 A.D.2d 783, 742 N.Y.S.2d 718 (Third Dept. 2002) where the Third Department reversed a decision that used the commencement date of a dismissed action as the date for fixing the marital portion of the husband's pension.  In that case it pointed out that it had recently made " it clear that the economic partnership of a marriage will not end with the commencement of an unsuccessful matrimonial action and that it is the date of commencement of the current successful action that controls".  The rule in the  Second Department is to the contrary.

 

        The December 4, 2002 issue of the New York Law Journal reports ,in an article entitled A Fugitive Doctrine Applies to Fleeing Mother@ by John Caher, that  Judge Dugan of  Family Court, Albany has found that a mother who absconded with her child has no right to seek relief from an order awarding temporary custody to the putative father - a man the woman now claimed raped her.  According to the article Peppin v. Lewis involved a mother who persistently frustrated the court's attempt to address paternity and custody issues.  Her current location was unclear and there was an outstanding warrant for her arrest. The holding on fugitivity adopted a recent New Jersey Supreme Court ruling in Matsumoto v. Matsumoto, 171 N.J. 2002, where the New Jersey court held that the doctrine could be employed to bar a civil appeal. Judge Duggan concluded that New York should follow this rule and adopted a multi-part test for application of the fugitive disentitlement doctrine.  To satisfy that test the petitioner must be a fugitive in either a criminal or civil case; there must be a nexus between the petitioner's fugitive status and the legal action requested by the petitioner; the petitioner's legal status must result in actual prejudice to the other party; and the court must consider whether the prejudice can be ameliorated by a less drastic remedy than outright dismissal.@

      In Wissink v Wissink, __AD2d__2002 N.Y. Slip Op. 07948, 2002 WL 31478782 (N.Y.A.D. 2 Dept.) the Second Department reversed an order of the family court which awarded custody of the parties 16 year old daughter to the father because the record revealed years of domestic violence, which was denied by the daughter, who witnessed it, and who expressed her preference to live with him. It held that the Family Court should have ordered a comprehensive psychological evaluation, where the forensic evaluator would be concerned with such issues as the nature of the psychopathology of the abuser and of the victim; whether the child might be in danger of becoming a future victim, or a witness to the abuse of some other victim; the child's developmental needs given the fact that she lived in the polluted environment of domestic violence all of her life and the remedial efforts that should be undertaken in regard to all parties concerned. The Appellate Division also held that Family Court erred in limiting the mother's inquiry regarding the father's failure to comply with his child support obligations and in finding financial considerations "not relevant at all" to the custody proceeding. It stated that the Family Court was required to consider the parties' support obligations and their compliance with court orders and to evaluate each party's ability to support the child. If, as the mother alleged, the father violated the child support order, and if he terminated the telephone and electrical services in the marital residence after he had been ordered to stay away pursuant to an order of protection, these facts would clearly be relevant to the court's custody determination.

The court pointed out that the parties had a tumultuous relationship marked by numerous episodes of heated arguments, physical violence, police intervention and Family Court orders of protection. When it came to his dealings with the mother, the father was a batterer. When it come to his daughter however, the father was the favored parent; and he appeared to be a model parent.

The Appellate Division reversed the custody order because the fact of domestic violence should have been considered more than superficially, particularly where the child expressed her unequivocal preference for the abuser, while denying the very existence of the domestic violence that the court found she witnessed. The record was replete with incidents of domestic violence reported by the mother, and by evidence supporting her testimony. Judge Miller ‘s opinion noted that Domestic Relations Law § 240(1) provides that in any action concerning custody or visitation where domestic violence is alleged, "the court must consider" the effect of such domestic violence upon the best interest of the child, together with other factors and circumstances as the court deems relevant in making an award of custody.

The Appellate Division pointed out that the Family Court did not entirely ignore that legislative mandate, and that it specifically noted that it had considered the effect of domestic violence in rendering its custody determination. However, it found that the "consideration" afforded the effect of domestic violence was sorely inadequate. The court-ordered mental health evaluation consisted of the social worker's interview of the daughter on two occasions (about 45 minutes each) and each parent once (about one hour each). The court noted that the devastating consequences of domestic violence have been recognized by our courts, by law enforcement, and by society as a whole. The effect of such violence on children exposed to it has also been established. There is overwhelming authority that a child living in a home where there has been abuse between the adults becomes a secondary victim and is likely to suffer psychological injury.
Moreover, that child learns a dangerous and morally depraved lesson that abusive behavior is not only acceptable, but may even be rewarded.
(Text of the Opinion)

In Gravlin v Ruppert,    NY2d,  decided May 7, 2002 the Court of Appeals  held that the unanticipated change in respondent's relationship with his daughter created a need for modification of the support terms of the separation agreement as those terms became unworkable. It is the necessity of ensuring that respondent continued to support his child as agreed upon by the parties, despite the inability to perform under the original terms of the agreement, that justified modification of the support provisions. Under the agreement, both parents assumed an obligation of support yet, after visitation broke down through no apparent fault of either party, only the custodial parent was providing support. Family Court may re-establish the support obligation of the non-custodial parent by modifying the support provisions of the separation agreement.( Text of the Opinion )

 

Goldman v. Goldman,     NY2d    ,    NYS2d      ,(2000) (Text) 

    In Goldman v Goldman, supra, the Court of Appeals held that a mortgage taken on one spouse's interest in a tenancy by the entirety while a divorce action was  pending survived after entry of a judgment of divorce and award of the property to the other spouse. On October 24, 1985, plaintiff Debra Goldman and her husband defendant Scott Goldman acquired a house as tenants by the entirety. In December 1990, plaintiff commenced an action for divorce. After commencement of the action, but before entry of judgment, plaintiff  gave her attorney, Phyllis Gelman, a $50,000 mortgage on the marital property as security for Gelman's legal services, without defendant's knowledge or consent. Gelman duly recorded the mortgage on August 13, 1991. The Goldmans were ultimately divorced by a judgment entered in October 1994, which awarded defendant exclusive title to the marital home. Although defendant had learned of Gelman's mortgage shortly after it was recorded in 1991, he failed to notify the trial court of its existence while the divorce action was pending, and the court made no special provision for it when equitably distributing the marital property. It held aAs tenants by the entirety, both spouses enjoy an equal right to possession of and profits yielded by the property (Neilitz v Neilitz, 307 NY 882). Additionally, "each tenant may sell, mortgage or otherwise encumber his or her rights in the property subject to the continuing rights of the other ".  Once the legal  relationship between husband and wife is judicially altered through divorce, annulment or legal separation, the tenancy by the entirety  converts to a tenancy in common. Although plaintiff here conveyed the mortgage after filing for  divorce, she nevertheless continued to hold an interest in the property as a tenant by the entirety until the final divorce decree . Thus, plaintiff was legally entitled to mortgage her  interest in the tenancy during the pending divorce action. In turn, Gelman acquired a contingent interest in all the rights plaintiff possessed at the time of conveyance. Once the trial court rendered a final judgment of divorce and plaintiff's interest in the  premises transmuted into a tenancy in common, Gelman retained an interest in the tenancy in common. Accordingly , while the distributive award divested plaintiff of her interest in the property, Gelman's bundle of rights, acquired before the final judgment of divorce, was not impaired. 

Charpie v Charpie,    AD2d   ,    NYS2d     , July     , 2000 (1st Dept., 2000) (Text)

    In Charpie v Charpie, supra, the First Department held that when an application for counsel fees pendente lite is made in a matrimonial litigation where a wife has assets that, although considerable, are finite, while her husband's wealth is far greater and his earnings continue to amass, the court should not limit itself to inquiry whether the wife is able to pay her attorney with the funds then in her possession. when a wife's expected attorneys' fees will exhaust a large portion of her finite resources, while her husband will be able to pay his ongoing attorneys' fees without substantial impact on his estate.  The court pointed out that "when considering an application for interim counsel fees, the court must consider the relative financial circumstances of both parties. This direction is intended not only to permit determination of one side's need and the other's ability to pay; it is also to ensure that a spouse with substantially greater financial resources cannot use those resources against the less powerful spouse to obtain the outcome he desires. The courts are to see to it that the matrimonial scales of justice are not unbalanced by the weight of the wealthier litigant's wallet" (citing O'Shea v O'Shea, 93 NY2d 187, 190).  It noted that at one time it had espoused the rule that counsel fees were precluded any time the spouse making the application had already paid her attorney, thus demonstrating the ability to pay (citing Kann v Kann, 38 AD2d 545). However, it pointed out that it  has since been held that her possession of assets, and her use of some of those assets to pay counsel, does not preclude the court from awarding counsel fees (citing DeCabrera v Cabrera-Rosete, 70 NY2d 879, 881).

The court held that the oft-repeated rule that "[i]ndigency is not a prerequisite to an award of counsel fees" (citing DeCabrera v Cabrera-Rosete, 70 NY2d 879, 881), while true, should not be understood to imply that a spouse's assets must be spent down to near-indigency before a counsel fee application will be entertained. A party who has finite assets and a small income should not be required to spend down a substantial portion of those assets in order to qualify for such an award, where her spouse appears to have much more extensive assets and income, with the concomitant ability to conduct legal battles over any contested issue. This holds especially true if, in addition, there are indications that the spouse with the financial clout may intend to assert his will over such issues of mutual concern as the children's care and custody, prepared to take unilateral action, and to conduct a legal battle if his wife disagrees.

Grunfeld v Grunfeld,   NY2d    ,    NYS2d     (2000) (Text)

    In O'Brien v O'Brien (66 NY2d 576), the Court of Appeals  ruled that, to the extent that it is acquired during marriage, a professional license is marital property subject to equitable distribution.  In McSparron v McSparron (87 NY2d 275), it reaffirmed the holding of O'Brien, under which "[t]he value of a newly earned license may be measured by simply comparing the average lifetime income of a college graduate and the average lifetime earnings of a person holding such a license and reducing the difference to its present value" .  McSparron explicitly rejected the theory that the license eventually "merges" with and has no separate value apart from a professional practice. McSparron held that "where the licensee has already embarked on his or her career and has acquired a history of actual earnings, * * * [O'Brien's] theoretical valuation method must be discarded in favor of a more pragmatic and individualized analysis based on the particular licensee's remaining professional earnings potential". The McSparron Court also warned that "care must be taken to ensure that the monetary value assigned to the license does not overlap with the value assigned to other marital assets that are derived from the license such as the licensed spouse's professional practice" . 

 McSparron also cautioned lower courts to "be meticulous in guarding against duplication in the form of maintenance awards that are premised on earnings derived from professional licenses" . To allow such duplication would, in effect, result in inequitable, rather than equitable, distribution. In contrast to passive income-producing marital property having a market value, the value of a professional license as an asset of the marital partnership is a form of human capital dependant upon the future labor of the licensee. The asset is totally indistinguishable and has no existence separate from the projected professional earnings from which it is derived. To the extent, then, that those same projected earnings used to value the license also form the basis of an award of maintenance, the licensed spouse is being twice charged with distribution of the same marital asset value, or with sharing the same income with the non-licensed spouse.

In Grunfeld, in setting the level of maintenance, Supreme Court  included as part of defendant's earning capacity the projected earnings derived from his professional license. The court also used the same earnings attributable to the law license to determine the present value of the license as a ma