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Wednesday, June 02, 2021

Recent Decisions June 2, 2021

 

Appellate Division, Second Department

 

 

Party claiming an investment account was actively managed has the burden of proof with respect to the claim.  Expenses of leisure, extracurricular and enrichment activities are encompassed within the basic child support award. A court can order a parent to pay these expenses over and above basic child support, but it is a deviation from the basic statutory formula and requires an analysis under the factors set forth in Domestic Relations Law § 240(1–b)(f).

            In Sinnott v Sinnott, --- N.Y.S.3d ----, 2021 WL 1901679, 2021 N.Y. Slip Op. 03073 (2d Dept,2021) the parties were married in 1989, and were the parents of one child born in 2003, as well as two emancipated children. The plaintiff commenced this action on February 16, 2016, by filing a summons and complaint. Pursuant to a so-ordered custody and parenting stipulation, the plaintiff had sole legal and residential custody of the child. The defendant appealed from so much of the judgment as denied him a separate property credit of $937,000, (2) directed him to pay child support and add-on expenses until the child reached the age of 22 years and six months under stated circumstances, (3) directed him to pay 80% of the child’s private high school tuition, fees, books, supplies, materials, class trips, enrichment activities, and all school-related expenses, and (4) directed that certain investment accounts be equally divided between the parties without specifying a date of valuation for those accounts or limiting distribution only to marital property. The plaintiff cross-appealed from so much of the judgment as (1) directed the defendant to pay child support of only $4,281.44 per month and only 80% of add-on expenses for the child, (2) declined to make the award of maintenance and child support retroactive to the date of commencement of the action, (3) declined to direct the defendant to pay the cost of health insurance for the plaintiff, and (4) declined to direct the defendant to obtain or maintain life insurance in an amount sufficient to secure his support obligations.

 

            The defendant contended on appeal that the Supreme Court erred by failing to direct that the plaintiff’s investment accounts should be valued as of the date of commencement of the action, and that only marital property in those accounts should be subject to equitable distribution. The valuation date of a marital asset may be set “anytime from the date of commencement of the action to the date of trial. The court failed to set forth the valuation date for the investment accounts . The party claiming that an account was actively managed, or contained separate property not subject to equitable distribution, has the burden of proof with respect to those claims. The defendant failed to provide evidence as to whether the accounts in question were actively managed or passive. The Supreme Court therefore did not improvidently exercise its discretion in treating those accounts, in effect, as passive accounts, by its direction that the accounts be liquidated within 30 days from the entry of the decision after trial and that the resulting proceeds be divided 50–50. However, since assets must be valued at a date not earlier than an action’s commencement nor later than the trial it modified modify the judgment to the extent of directing that the accounts be valued as of August 28, 2018, the first date of trial.

 

            The Appellate Division held that the Supreme Court made numerous errors when calculating the defendant’s basic child support obligation under the Child Support Standards Act (CSSA). Supreme Court incorrectly calculated his gross income for 2017. The defendant’s gross (total) income as should have been ... reported in the most recent federal income tax return was $1,037,044, and, the defendant’s gross income for CSSA purposes was $1,061,044.25. The defendant’s income for CSSA purposes was $975,399.57. The plaintiff’s income for CSSA purposes was $78,000 per year. The defendant’s share of the basic annual support obligation was 92.6% of $25,160 or the annual sum of $23,298.16. It modified the judgment of divorce to direct the defendant to pay the plaintiff $4,591.42 per month in basic child support.

 

            Regarding the add-on for uncovered, unreimbursed medical and related expenses, responsibility for future reasonable unreimbursed health care expenses shall be prorated in the same proportion or percentage as each parent’s income bears to the combined parental income. It modified the judgment of divorce to provide that the defendant’s pro rata share of the child’s uncovered, unreimbursed medical and related expenses was 92.6%, the same proportion as his income was to the combined parental income

 

            The Appellate Division noted that education expenses are not directly connected to the basic child support calculation” and are not necessarily prorated in the same proportion or percentage as each parent’s income bears to the combined parental income. Supreme Court did not improvidently exercise its discretion by directing the defendant to pay 80% of the child’s tuition at Marymount High School of New York, or a similar private high school, nor by requiring the defendant to pay 80% of the child’s fees, books, supplies, and materials.

 

            The Appellate Division held that Supreme Court improvidently exercised its discretion by directing the defendant to pay 80% of the child’s class trips, enrichment activities, and all other school related expenses. Basic child support, when calculated properly, is presumed to meet all the child’s basic needs. Thus, the expenses of leisure, extracurricular and enrichment activities, such as after-school clubs, sporting activities, etc., are usually not awarded separately, but are encompassed within the basic child support award. A court can order a parent to pay these expenses over and above basic child support. However, if it does so, it is a deviation from the basic statutory formula and requires an analysis under the factors set forth in Domestic Relations Law § 240(1–b)(f). Although all the factors do not have to present, the court needs to articulate its reasons for making such a deviation from basic child support and relate those reasons to the statutory paragraph (f) factors. Here, the Supreme Court did not provide a benchmark for what class trips, enrichment activities, and all other school related expenses could include and there was no cap on the total cost. In any event, under the circumstances of this case, it found that the award of basic child support was sufficient to meet these needs.

 

            The Appellate Division held that  Supreme Court improperly defendant to pay basic child-support and add-on expenses for the child after she reaches the age of 21. A parent has no legal obligation to provide for or contribute to the support of a child over the age of 21.

 

            The Appellate Division held that Supreme Court should not have directed the defendant to pay maintenance and child support commencing on the first day of the first month following its decision after trial. A party’s maintenance and child support obligations commence, and are retroactive to, the date the applications for maintenance and child support were first made, which, in this case, was February 16, 2016. However, the party is also entitled to a credit for any amount of temporary maintenance and child support already paid. Here, the defendant may be entitled to credit for voluntary child support payments which were made prior to a pendente lite order dated August 16, 2017, and for voluntary maintenance payments made during the pendency of the action. In addition, he was entitled to a credit for any amount of temporary maintenance and child support which was paid pursuant to the pendente lite order. It remitted the matter to the Supreme Court, for a determination as to the amount of retroactive child support, including add-ons, and maintenance arrears from February 16, 2016, giving the defendant appropriate credits

 

            The Appellate Division held that under the circumstances of this case, the Supreme Court should have directed the defendant to pay the plaintiff’s health insurance costs during the period the defendant is obligated to pay maintenance, and should have directed the defendant to obtain or maintain a policy of life insurance for the benefit of the plaintiff and the child in an amount sufficient to secure his maintenance, child support, and health insurance obligations.

 

 

 

Under UIFSA Florida retained exclusive jurisdiction over his child support obligation to the daughter, where mother died, and father remained in Florida although daughter moved to New York and under Florida law, his obligation to support the daughter ceased when she turned 18

 

            In Matter of Nassau County Department of Social Services v Ablog, 2021 WL 1899886 (2d Dept.,2021) pursuant to a 2009 Florida judgment of divorce, the father was obligated to pay child support for the daughter “until the child attains the age of eighteen years or graduates from high school, as long as the child is progressing in school and will graduate before attaining the age of nineteen years.” The daughter resided with her mother following the judgment of divorce until February 2018, when the mother died and the father became the custodial parent. The daughter turned 18 years of age in September 2018. She moved to New York in 2019. The father continued to reside in Florida. The daughter applied for and began receiving public assistance in Nassau County. In July 2019, the Nassau County Department of Social Services filed a petition for support on behalf of the daughter. The father moved to dismiss the petition for lack of subject matter jurisdiction pursuant to the Uniform Interstate Family Support Act (UIFSA), arguing that Florida retained exclusive jurisdiction over his child support obligation to the daughter, and that under Florida law, his obligation to support the daughter ceased when she turned 18. The Support Magistrate denied the motion, finding that the subject application was not seeking to modify the father’s existing child support obligation in Florida, but, instead, was a de novo application for support. The Appellate Division reversed. It held that under the [Full Faith and Credit for Child Support Orders Act] and UIFSA, the state issuing a child support order retains continuing, exclusive jurisdiction over its child support orders so long as an individual contestant continues to reside in the issuing state” (Matter of Spencer v. Spencer, 10 N.Y.3d 60, 66, 853 N.Y.S.2d 274; see 28 USC § 1738B[d]; cf. Family Ct Act § 580–205). Accordingly, a state may modify the issuing state’s order of child support only when the issuing state has lost continuing, exclusive jurisdiction. The federal statute defines a “modification” to mean “a change in a child support order that affects the amount, scope, or duration of the order and modifies, replaces, supersedes, or otherwise is made subsequent to the child support order” (28 USC § 1738B[b][8]). Under the plain language of the federal statute, the New York order of support was a “modification” of the Florida judgment. Since the father still resided in Florida, that state had continuing, exclusive jurisdiction of the child support order, despite the termination of his obligations under that order, and New York did  not have subject matter jurisdiction to modify that order.

 

 

 

There is a rebuttable presumption that interim counsel fees shall be awarded to less monied spouse, and courts should normally grant a request made by the nonmonied spouse, in the absence of good cause to deny the request 

 

            In Tomassetti v Tomassetti, --- N.Y.S.3d ----, 2021 WL 1897796 (Mem), 2021 N.Y. Slip Op. 03075 (2d Dept.,2021) the plaintiff commenced an action for a divorce against the defendant in 2017. In April 2018, the Supreme Court awarded the plaintiff interim counsel fees of $200,000. In August 2018, the plaintiff filed a motion seeking additional interim counsel fees of $376,524. The court granted the plaintiff’s motion to the extent of directing the defendant to pay$165,000 to the plaintiff’s counsel. The Appellate Division observed that there is a rebuttable presumption that interim counsel fees shall be awarded to the less monied spouse, and courts should normally exercise their discretion to grant such a request made by the nonmonied spouse, in the absence of good cause to deny the request. It found that the significant disparity between the financial circumstances of the defendant, a real estate investor and developer with considerable disposable income and a net worth approaching $200 million, and those of the plaintiff could not seriously be disputed. It held that, the Supreme Court improvidently exercised its discretion in limiting, without good cause, the plaintiff’s award of additional interim counsel fees to $165,000, which was far less than the amount of legal fees the plaintiff had already incurred. It found that an award of additional interim counsel fees of $370,000 was appropriate.

 

 

Supreme Court

 

 

Contract for Preservations and Disposition of Embryos not violative of Domestic Relations Law §236(B)(3)

 

            In K.G., v. J.G.,--- N.Y.S.3d ----, 2021 WL 2021873, 2021 N.Y. Slip Op. 21140 (Sup Ct, 2021)  an action for a divorce, the plaintiff  moved for declaratory judgment regarding her rights under a contract with her husband and Reproductive Medical Associates of New York (“RMA”) containing an agreement entitled “Consent for Cryopreservation of Embryo(s) by Couples with Joint Custody.” Plaintiff argued that pursuant to this specific contract, she had the right to dispositional control of the embryos created by RMA with the parties’ genetic material. Defendant  cross moved for summary judgment, arguing that the contract was unenforceable. The Consent agreement provided for of the embryos, and the procedures for using the embryos or for transferring the embryos should the parties wish another facility to preserve them. The contract  was made with RMA’s pre-printed forms and was signed by the plaintiff and the defendant, but was not notarized or subscribed and acknowledged in the form required for a deed to be recorded. Supreme Court held that Domestic Relations Law §236(B)(3) which requires agreements between married couples to be subscribed and acknowledged in the form required for a deed to be recorded, was not applicable to this contract which included services from and benefits to a third party. The Court of Appeals in Kass v. Kass, 91 N.Y.2d 554, 673 N.Y.S.2d 350, 696 N.E.2d 174 (1998) unequivocally stated that “agreements between progenitors, or gamete donors, regarding disposition of their pre-zygotes should generally be presumed valid and binding and enforced in any dispute between them.” Furthermore, IVF contracts such as this one are not violative of public policy and are specifically encouraged by the Kass decision. Plaintiff’s motion to declare that the post-marital dispositional election in the Consent agreement executed on May 18, 2016 was enforceable was  granted; the defendant’s cross motion was denied.