Appellate Division, Second Department
Where husband who placed spyware on wife’s computer invoked Fifth Amendment, and intentionally destroyed evidence as to what the spyware actually intercepted, appropriate sanction was to strike the causes of action in the complaint relating to the financial issues other than child support
In C. C. v. A. R., --- N.Y.S.3d ----, 2021 WL 800051, 2021 N.Y. Slip Op. 01243 (2d Dept.,2021) the plaintiff installed spyware on the wife’s phone, invoked Fifth Amendment protections on the issue, and intentionally destroyed evidence as to what the spyware actually intercepted. The Appellate Division held that Supreme Court properly determined, under the circumstances here, that it was proper to infer that the plaintiff violated the defendant’s attorney-client privilege, and that the appropriate sanction was to strike the causes of action in the complaint relating to the financial issues of the case other than child support. It noted that a party that seeks sanctions for spoliation of evidence must show that the party having control over the evidence possessed an obligation to preserve it at the time of its destruction, that the evidence was destroyed with a culpable state of mind, and that the destroyed evidence was relevant to the party’s claim or defense such that the trier of fact could find that the evidence would support that claim or defense’. Where the evidence is determined to have been intentionally or wilfully destroyed, the relevancy of the destroyed documents is presumed” (Pegasus Aviation I., Inc. v. Varig Logistica S.A., 26 N.Y.3d at 547, 26 N.Y.S.3d 218, 46 N.E.3d 601). Here, the Supreme Court properly drew the presumption of relevance in connection with the interception by the plaintiff of privileged communications between the defendant and her attorney in view of the plaintiff’s invocation of his Fifth Amendment privilege against self-incrimination when questioned about it at his deposition, his intentional destruction of electronic records, and the evidence that he had utilized spyware to record the defendant’s conversations when she was in the vicinity of her attorney’s office. Although this presumption is rebuttable, the plaintiff did not provide any evidence to rebut it. Further, while the striking of pleadings is a drastic remedy, the court did not improvidently exercise its discretion in striking the causes of action in the plaintiff’s complaint seeking financial relief other than child support. Under the common-law doctrine of spoliation, a party may be sanctioned where it negligently loses or intentionally destroys key evidence. These sanctions can include “precluding proof favorable to the spoliator to restore balance to the litigation, requiring the spoliator to pay costs to the injured party associated with the development of replacement evidence, or employing an adverse inference instruction at the trial of the action. Where appropriate, a court can impose the ultimate sanction of dismissing the action or striking responsive pleadings, thereby rendering a judgment by default against the offending party” (Ortega v. City of New York, 9 N.Y.3d 69, 76, 845 N.Y.S.2d 773, 876 N.E.2d 1189).
Any monies spent from companies which are defendants separate property would not be considered marital property and could not be wastefully dissipated by the defendant.
In Rosen v Rosen, --- N.Y.S.3d ----, 2021 WL 799852, 2021 N.Y. Slip Op. 01278 (2d Dept.,2021) the parties were married on May 5, 1985. Prior to the marriage, in 1981, the defendant incorporated Airline Software, Inc. Airline was in operation through 2004, and then the name of the company was changed to Airframe Systems, Inc. The defendant incorporated various companies thereafter. The primary operating company from 2004 through 2011 was Aviation Software, Inc. In 2006, the defendant incorporated ASI Scanning, Inc., which eventually took over Aviation’s operations.
The parties entered into a prenuptial agreement in which they agreed that the defendant’s separate property included shares of stock in Airline and GSRAI. The prenuptial agreement provided that the plaintiff waived all rights to the defendant’s separate property, as well as to any property that the defendant may in the future purchase or exchange with the proceeds of his separate property. The plaintiff also waived her right to any increase in value of the defendant’s separate property in which the defendant presently had an interest or in which he may have an interest acquired as a result of a sale or exchange of his separate property.
The parties separated in 2009, and the plaintiff commenced this action for a divorce in March 2012. Supreme Court, inter alia, awarded the plaintiff a distributive award in the sum of $363,644.74, representing 30% of the value of the defendant’s interest in ASI and a net credit in the sum of $200,807.74 for the parties’ wasteful dissipation of marital funds.
The Appellate Division held the Supreme Court erred in determining that ASI was marital property and in awarding the plaintiff a percentage thereof. It was undisputed that the defendant’s interest in Airline, which was later renamed Airframe, constituted separate property. Since Airline exchanged its operations with Aviation, and Aviation exchanged its operations with ASI, the plaintiff waived all rights to the value of the defendant’s interest in ASI.
The Appellate Division held that a party alleging that his or her spouse has engaged in wasteful dissipation of marital assets bears the burden of proving such waste by a preponderance of the evidence (Marino v. Marino, 183 A.D.3d 813, 820, 123 N.Y.S.3d 638). ASI and Aviation constituted the defendant’s separate property. Therefore, any monies spent from those companies would not be considered marital property and could not be dissipated by the defendant. The Supreme Court found that the vast majority of the funds that the defendant allegedly wastefully dissipated were generated from ASI. The defendant conceded that he wastefully dissipated $7,525 in marital funds. Thus, the plaintiff was entitled to a credit of only $7,525 for the defendant’s uncontested wasteful dissipation of marital assets.
The plaintiff did not dispute the Supreme Court’s finding that she wastefully dissipated the proceeds from the sale of the marital home and, thus, there was no ground to disturb the court’s finding that the defendant is entitled to an award of the sum of $82,726.49, which represents 50% of the sum of $165,452.97 that the plaintiff received from those proceeds, less expenses. Accordingly, the defendant was entitled to a net distributive award in the sum of $75,201.49.
The Appellate Division affirmed the awards to the plaintiff of maintenance of $4,000 per month for a period of three years, $211,300 in maintenance arrears, and attorneys’ fees of $30,000.
Error to decide motion to enjoin relocation request without considering the factors set forth in Matter of Tropea
In Conroy v Vaysman, --- N.Y.S.3d ----, 2021 WL 710591, 2021 N.Y. Slip Op. 08182 (2d Dept.,2021) the Appellate Division held that Family Court erred in deciding the mothers motion to enjoin the father’s relocation with the child to New Jersey without considering the factors set forth in Matter of Tropea. It observed that each relocation request must be considered on its own merits with due consideration of all the relevant facts and circumstances and with predominant emphasis being placed on what outcome is most likely to serve the best interests of the child. The factors to be considered by the court in its analysis are listed in Matter of Tropea v. Tropea, 87 N.Y.2d 727, 739, 642 N.Y.S.2d 575.
Appellate Division, Third Department
Proceeding that sought to terminate the rights of one parent in the face of an existent permanency plan that sought to reunite the child with the other parent, were contradictory and could not be reconciled. Therefore, the petition should have been dismissed.
In Matter of Xavier XX, --- N.Y.S.3d ----, 2021 WL 816376, 2021 N.Y. Slip Op. 0129 (3d Dept.,2021) Respondent was the father of the child (born in 2016). In September 2017, the child’s mother consented to the temporary removal of the child from her custody, and the child was placed in the care and custody of petitioner. Thereafter, petitioner commenced a neglect proceeding against the mother and the child was adjudicated a neglected child and the mother was placed under an order of supervision for one year. At a permanency hearing in November 2018, custody of the child was continued with petitioner. The goal of the permanency plan resulting from the hearing was to return the child to the mother. In February 2019, petitioner commenced a proceeding pursuant to Social Services Law § 384–b, seeking to adjudicate the child to be abandoned by respondent and to terminate his parental rights. After a hearing, Family Court determined that respondent abandoned the child. As such, it thereafter terminated respondent’s parental rights. The Appellate Division reversed. It held that the proceeding was improperly brought as the permanency plan in place at the time of the hearing with respect to the mother was to return the child to the mother. The statutory purpose of an abandonment proceeding is to free the child for adoption by terminating the parents’ rights to the child. Because this proceeding sought to terminate the rights of one parent in the face of an existent permanency plan that sought to reunite the child with the other parent, it did not serve that purpose. The end goals of these two concurrent proceedings were contradictory and could not be reconciled. Therefore, the petition should have been dismissed.
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