Fair Trial Denied Where Family Court Judge Took on the Function and Appearance of an Advocate
In Matter of Jacquilin M, 83 A.D.3d 844, 922 N.Y.S.2d 111 (2 Dept, 2011) Jacqulin M. appealed from an order of disposition of the Family which, upon a fact-finding order of a hearing, finding that the appellant committed acts which, if committed by an adult, would have constituted the crimes of grand larceny in the fourth degree and criminal possession of stolen property in the fifth degree, adjudged her to be a juvenile delinquent, and placed her on probation for a period of 18 months. The order of disposition was reversed on the law and as a matter of discretion in the interest of justice, the fact-finding order was vacated, and the matter is remitted to the Family Court for a new fact-finding hearing. The appellant's contention that she was deprived of a fair trial because the Family Court Judge took on the function of an advocate by excessively intervening in the fact-finding hearing was unpreserved for appellate review. However, the Appellate Division reached this issue in the exercise of its interest of justice jurisdiction because the Family Court Judge's excessive intervention deprived the appellant of her right to a fair fact-finding hearing. It observed that although trial courts may appropriately take an active role in the presentation of evidence "in order to clarify a confusing issue or to avoid misleading the trier of fact" (People v. Arnold, 98 N.Y.2d 63, 67, 745 N.Y.S.2d 782, 772 N.E.2d 1140), the function of the judge is "to protect the record at trial, not to make it". Thus, while a certain degree of judicial intervention in the presentation of evidence is permissible, "the line is crossed when the judge takes on either the function or appearance of an advocate at trial" (People v. Arnold, 98 N.Y.2d at 67, 745 N.Y.S.2d 782, 772 N.E.2d 1140; see People v. Zamorano, 301 A.D.2d 544, 546, 754 N.Y.S.2d 645). These principles apply in bench trials, including juvenile delinquency proceedings. Here, the Family Court Judge took on the function and appearance of an advocate by extensively participating in both the direct and cross-examination of the two presentment agency witnesses and eliciting testimony which strengthened the presentment agency's case. Furthermore, when the appellant indicated, during the course of her direct examination, that a certain document which would support her defense had been turned over to a Probation Department officer, the Judge interrupted her testimony to question a Probation Department Court Liaison who was present in the courtroom about whether documents of this nature would indeed be kept by the Probation Department. The Judge then summoned the Probation Department officer assigned to the appellant's case to the courtroom, and indicated to the appellant's attorney that unless he agreed to stipulate as to what certain Probation Department records would reflect, those records would be admitted into evidence through the Probation Officer's testimony. It was clear from the record that neither the presentment agency nor the appellant's attorney intended to call the Probation Officer as a witness or enter the Probation Department records into evidence, and the stipulation regarding what those records reflected had the effect of rebutting a portion of the appellant's testimony. Thus, the Judge essentially "assumed the parties' traditional role of deciding what evidence to present" . Furthermore, the Judge offered no explanation on the record as to why he felt compelled to solicit this evidence. Under these circumstances, a new fact-finding hearing was warranted.
Third Department Explains Difference Between in Camera Hearing and True Lincoln Hearing
In Matter of Spencer v Spencer, --- N.Y.S.2d ----, 2011 WL 2150028 (N.Y.A.D. 3 Dept.) the parties were the parents of three children (born in 1997, 1999 and 2001). In their divorce judgment, the parties agreed to joint legal custody, physical placement with respondent (mother), and visitation with petitioner (father) every other weekend. In 2009, the father commenced a proceeding seeking to modify the custodial arrangement based upon an improper relationship that the mother's male friend had with one of the parties' children while in the mother's care. Family Court temporarily placed the children with the father. After several court appearances and an in camera interview with each of the children, the court issued an order awarding primary physical custody to the father and extensive visitation to the mother. The Appellate Division found that the mother did not consent to the court making and order without a hearing, and held that Family Court erred by modifying the custody order without holding a fact-finding hearing. The father's petition adequately alleged a change in circumstances, namely that the mother exposed the children to a convicted sex offender and she was aware that this individual had an inappropriate relationship with one of the children. The mother admitted that an inappropriate relationship occurred, but denied knowing about it. The parties disagreed about most of the other allegations. The mother specifically objected to the court's failure to hold a hearing, and the court lacked record information that would permit it to determine whether the alleged change in circumstances required a modification of the prior custody order .A court may not grant a final order based upon mere allegations and a request by an attorney for a party or the children; evidentiary proof is required. Thus, it reversed the order on the law and remitted for Family Court to hold a hearing on the petition.
The Appellate Division observed that Family Court and the parties inaccurately referred to the in camera interviews with the children as a Lincoln hearing. The purpose of a Lincoln hearing in a custody proceeding "is to corroborate information acquired through testimonial or documentary evidence adduced during the fact-finding hearing" (Matter of Lincoln v. Lincoln, 24 N.Y.2d 270, 273 [1969] ). Thus, a true Lincoln hearing is held after, or during, a fact-finding hearing; there is no authority or legitimate purpose for courts to conduct such interviews in place of fact-finding hearings, and Family Court erred in doing so here. Additionally, it cautioned the court to protect the children's right to confidentiality by avoiding disclosure of what children reveal in camera during a custody proceeding.
Unsubstantiated Allegations Insufficient to Warrant the Invocation of Temporary Emergency Jurisdiction under UCCJEA.
In Segovia v Bushnell, --- N.Y.S.2d ----, 2011 WL 2150113 (N.Y.A.D. 3 Dept.) Respondent, the mother of two sons (born in 1999 and 2002), refused to release the children to the paternal grandparents for visitation and instead brought them to New York from Texas. A Texas court thereafter issued a temporary order granting custody to the father and petitioner, the paternal grandmother. Petitioner then commenced a proceeding seeking registration and enforcement of the Texas order ( Domestic Relations Law 77-d, 77-g). Respondent did not contest registration of the Texas order, but requested that Family Court exercise temporary emergency jurisdiction based on her allegations that the paternal grandparents had sexually abused the children (Domestic Relations Law 76-c). Family Court placed the children in the temporary custody of the Department of Social Services and ordered an investigation into respondent's allegations. Upon conclusion of the investigation, Family Court found the allegations to be unfounded and granted enforcement of the Texas order.
The Appellate Divison affirmed. Family Court heard, without objection, testimony that the children met with a local sexual abuse validator who determined that there was no sexual abuse, and it reviewed an investigative report prepared by authorities in Texas after respondent made the same allegations there. The Texas authorities conducted an exhaustive review and found no evidence to substantiate the allegations of sexual abuse. In light of the information rebutting respondent's claims, it agreed with Family Court that her unsubstantiated allegations were insufficient to warrant the invocation of temporary emergency jurisdiction.
The Rights and Needs of the Children Must Be Accorded the Greatest Weight in a Relocation Case
In Alaire K.G. v Anthony P.G.,--- N.Y.S.2d ----, 2011 WL 2135385 (N.Y.A.D. 1 Dept.) the First Department, in an opinion by Justice Moskowitz, observed that the appeal, involving a custodial parent's request to relocate with the parties' child, fell within the class of cases that "present some of the knottiest and most disturbing problems that our courts are called upon to resolve" (Matter of Tropea v. Tropea, 87 N.Y.2d 727, 736 [1996] ). The parties were married in January 2004, separated about a year and a half later and were divorced on July 13, 2006. They were the parents of a now six-year-old boy born on May 17, 2004. The stipulation settling the divorce case granted the mother legal and physical custody of the child. The father had visitation every week from Monday at 8:00 p.m. until Wednesday at 6:00 p.m. The stipulation allowed relocation within 25-miles of the father's house in the Bronx.
The father had a history of irregular employment and was currently not employed. At the time of trial, the mother, who was remarried, cared for her younger child from her second marriage, full time. After the parties separated, the mother remained in the marital apartment in the Bronx with the child for two years. In the fall of 2007, she began working as a project administrator in the construction field. In 2007, she moved with the child and her boyfriend to Connecticut. The mother testified that she always wanted her son to be in a suburban environment. She stated that she was trying "to mirror my own childhood. I had a wonderful suburban upbringing." The relationship in Connecticut ended when the boyfriend returned to his native New Zealand. The mother returned to New York with the child and moved into an apartment in Harlem. In March 2008, the mother met her future husband, Hugh Bonnar, on Match.com. Bonnar was retired from the Air Force, lived in North Carolina and was then involved in a nation-wide job search. Ultimately, Bonnar took a job with Northrop Grumman in San Diego. He had requested to work at Northrop Grumman's Long Island branch, but the company could not accommodate his request. The mother and Bonnar became engaged in May 2008. Soon after her engagement, the mother approached the father about moving to California to live with Bonnar. The father was concerned about the distance and the stability of the mother's new relationship. The parties therefore met with a mediator to try to work out an arrangement by which the mother could leave the child with the father temporarily while she settled in California. The mediator sent a letter, dated May 12, 2008, that purported to memorialize the parties' agreement. The letter stated that the parties agreed that the child would stay with the father from June 27, 2008 until December 31, 2008, with the mother making several long weekend visits to New York. Mother and son were also to participate in a webcam phone call two to three times a week. The letter did not address where the child would live after December 31, 2008. However, the father refused to sign an agreement embodying these terms and instead asked the mother to sign over custody to him. She refused. The mother left for California on June 26, 2008. She claimed that she never intended the father to have permanent custody, but arrangements to move to California had become irreversible by the time she learned that the father did not agree. The mother gave birth to Bonnar's son on April 4, 2009. She and Bonnar were also married in April 2009.
On July 17, 2008, the father filed a petition seeking sole legal and physical custody of the parties' child, claiming that the mother had abandoned the child. On December 1, 2008, the mother filed a petition for relocation.
Justice Moskowitz pointed out that each relocation request must be considered on its own merits with due consideration of all relevant facts and circumstances and with the predominant emphasis being placed on what outcome is most likely to serve the best interests of the child" (citing Tropea v. Tropea 87 N.Y.2d 727, 739 [1996] ). The dissent stated that Tropea dictates that the court's "central concern" should be the impact of the move on the relationship between the child and the noncustodial parent. Justice Moskowitz held that this interpretation misreads the case. Tropea states that "[o]f course, the impact of the move on the relationship between the child and the noncustodial parent will remain a central concern." However, it is not "the" central concern. Rather, the case makes abundantly clear that "it is the rights and needs of the children that must be accorded the greatest weight". She noted that the Court of Appeals rejected the "three-tiered" analysis that required a court to determine first "whether the proposed relocation would deprive the noncustodial parent of regular and meaningful access to the child".
The court found that there was a sound and substantial basis in the record for the determination granting the mother's request to relocate to California with her son. First, there was no question that the California home was financially more stable than the father's home. The stepfather had a steady job with Northrop Grumman that provided his family with health insurance. By contrast, the father was not currently working. Although he had been offered a job as a teacher's aide, he had postponed his start date. He was currently on some type of public assistance and received money from his parents in Ireland. He admitted that "it's not been easy like money wise." He was not currently in a relationship. Given his bleak financial circumstances, with no career or family in New York, it appeared that there was nothing keeping the father from moving to San Diego himself to be closer to his son. The Court quoted that part of Tropea, 87 N.Y.2d at 740 which said"where the custodial parent's reasons for moving are deemed valid and sound, the court in a proper case might consider the possibility and feasibility of a parallel move by an involved and committed noncustodial parent as an alternative to restricting a custodial parent's mobility". Further, living in San Diego ensured that the child would grow up in the same house as his half brother. The father agreed that it was very important for the child to have a brother in his life. He even testified that he actually expected the child eventually to move to California so that he could be with his brother, the father was merely opposed to the date of the move. The mother established that the child would have access to an education that was just as good as, if not better than, his school in New York. Moreover, she testified that Bonnar's status as a veteran would allow the child to attend college within the State of California's university system free of charge. The record also reflected that the mother went out of her way to facilitate communication between the child and his father. The same could not be said of the father with respect to communication between the child and his mother. Finally, the child's own attorney recommended that the court permit the mother to relocate with the child, a factor that militated in favor of affirming the result the court reached.
Justice Moskowitz commented that the dissent's characterization of the mother as putting her own romantic interests ahead of her son's welfare was rank speculation. It was just as likely that the mother, herself an only child, was pursuing marriage aggressively to produce a sibling for her son, before he became much older, and an intact family. Regardless of the mother's motivations, it is the best interest of the child that must guide the decision.
The Court found that the visitation schedule, that required the mother to pay for air travel for the child to be with the father on numerous extended weekend visits throughout the year in addition to extended summer and holiday visits, did not deprive the father of the opportunity to maintain a close relationship with his son .
Memorandum of Understanding Was Not a Final Agreement Even Thought it Contemplated Parties' Subsequent Execution of "Opting-out Agreement”
In Vega v Papaleo, --- N.Y.S.2d ----, 2011 WL 2224860 (N.Y.A.D. 3 Dept.) Plaintiff commenced the action for divorce in 2006 on the ground of cruel and inhuman treatment. In 2008, after engaging in protracted litigation and settlement negotiations, the parties, both of whom were represented by counsel, signed a memorandum of understanding (MOU) that provided for distribution of the parties' marital assets. Plaintiff's attorney then notified Supreme Court that the matter had been resolved and the case, which had been scheduled for trial, was removed from the trial calendar. Thereafter, plaintiff was presented with a settlement agreement but refused to sign it. Plaintiff subsequently retained new counsel and the matter was restored to the trial calendar. After several pretrial conferences, Supreme Court granted a motion by defendant for summary judgment, seeking a judgment granting plaintiff a divorce and incorporating, but not merging, the terms of the MOU into the judgment of divorce. A judgment of divorce was entered accordingly, prompting this appeal by plaintiff.
On appeal Plaintiff argued that the MOU was not an enforceable agreement and that, even if it is enforceable, it should be set aside on the basis that her attorney fraudulently induced her to sign the document by misrepresenting its legal significance. The Appellate Division affirmed. It found that as the movant for summary judgment, defendant met his initial burden of demonstrating that the MOU was an enforceable agreement under Domestic Relations Law 236(B)(3), as the document, itself was in writing, subscribed by the parties, and acknowledged or proven in the manner required to entitle a deed to be recorded" (Domestic Relations Law 236[B] [3]; see CPLR 2104). Plaintiff conceded that the MOU met the statutory requirements. Her argument that it was not enforceable because it was not "endorsed" in open court was unavailing, as there is no requirement that a properly executed written settlement agreement be so endorsed Thus, the burden shifted to plaintiff to demonstrate by the proffer of admissible evidence the existence of material issues of fact requiring a trial. To that end, plaintiff submitted her own affidavit, and the affirmations of her current attorney and a friend who accompanied her to her then attorney's office on the day she signed the MOU. According to those submissions, plaintiff did not wish to sign the MOU because it did not address certain assets, but she ultimately signed it based upon her then attorney's assurances that those issues could be raised at a later time. Plaintiff alleges that she would not have signed the MOU if she had known that it would be considered a final agreement. As to the merits, plaintiff had not alleged that defendant, or anyone acting on defendant's behalf, perpetrated any fraud or duress upon her. While plaintiff may have other remedies available to her, her allegations--relating solely to her attorney's conduct–were insufficient to set aside the MOU.
The Appellate Division also rejected plaintiff's argument that the MOU was not a final agreement because it contemplated the parties' subsequent execution of an "opting-out agreement." The MOU provided that it "will be incorporated into a full opting-out agreement to be signed by the parties containing these terms and only those other terms which are necessary to have a full and complete opting-out agreement, but due to the time constraints, [the parties] may not have the ability to finalize an opting-out agreement prior to the date scheduled for trial." The MOU then goes on to address, in detail, numerous issues including, among other things, a division of various items of real property, business interests, bank accounts, retirement accounts, marital debt and maintenance payments. It also contained a provision that "any additional terms and agreements to be contained within the opting-out agreement shall not alter or change any of the terms or conditions set forth in this [MOU]." Although the MOU directed entry into a further agreement, its terms were not contingent upon entry into such agreement. Accordingly, plaintiff failed to raise a question of fact sufficient to defeat defendant's motion.
Second Department Holds That 529 Plan College Fund Is Not a Bank Account under Stipulation for Divison of Assets
In Zuchowski v Zuchowski, --- N.Y.S.2d ----, 2011 WL 2279060 (N.Y.A.D. 2 Dept.) the parties 2009 stipulation of settlement, which was incorporated but did not merge into their judgment of divorce that was entered on June 17, 2009 provided that "all joint bank accounts have been split to the mutual satisfaction of the parties and here and forward each party shall keep any bank accounts in their respective names; namely, the wife in her name, the husband in his name." The stipulation also provided that "each party is responsible to pay the 50/50 share of college" for their children, but "the children shall avail themselves of every possible loan, grant or any other moneys offered to them by the college before the parties are respectfully [sic] required to contribute towards the education of the children." In an order dated January 11, 2010, the Supreme Court granted the defendant former husband's motion which was, in effect, to direct the plaintiff former wife to provide him with quarterly statements relating to a "529 Plan" sponsored by the State of New Hampshire and managed by Fidelity Investments, which the parties had established as a college fund for their son Peter, and to apply the money in the subject account to Peter's college expenses before either party would be required to contribute to such expenses. The former wife moved for leave to reargue, contending that since the 529 Plan was in her name, it was, under the terms of the stipulation of settlement, separate property belonging to her, and thus should be applied to reduce only her share of Peter's college costs. The account statements named the former wife as the "participant" and Peter as the "beneficiary," and the record indicated that the participant is considered to be the owner of the account assets until they are withdrawn. Supreme Court granted the former wife's motion and, upon reargument, vacated the portion of its January 11, 2010, order relating to the 529 Plan.
The Appellate Divison reversed on the law. It observed that when interpreting a contract, the court should arrive at a construction which will give fair meaning to all of the language employed by the parties to reach a practical interpretation of the expressions of the parties so that their reasonable expectations will be realized. Contrary to the former wife's contention, the stipulation of settlement could not reasonably be interpreted as treating the 529 Plan as one of the "bank accounts" that the party named as the account holder was entitled to "keep." While the stipulation of settlement provided that "all joint bank accounts have been split to the mutual satisfaction of the parties," there was nothing in the stipulation to support a finding that the parties intended the monetary assets they were allocating between themselves to include Peter's college fund. Although the former wife was technically the owner of the funds in the 529 Plan, the reason for that account's existence was not to personally benefit either of the parties, but to fund Peter's college education. Accordingly, upon reargument, the Supreme Court should have adhered to its original determination directing the former wife to provide the former husband with quarterly statements relating to the 529 Plan, and to apply the money in that account to Peter's college expenses before either party would be required to contribute to such expenses.
Failure to Agree on a Modified Visitation Schedule Is Not a "Default” for Purposes of Attorneys Fee Provision
In Matter of Allegretti v Fitzpatrick, --- N.Y.S.2d ----, 2011 WL 2279571 (N.Y.A.D. 2 Dept.) the Appellate Division held that the Family Court did not err in denying her motion for an award of an attorney's fee in connection with her petition to modify the visitation provisions set forth in a stipulation that was incorporated but not merged into the parties' judgment of divorce. The stipulation provided, among other things, that the parties were to "re-evaluate" the established visitation arrangements when their child began school. The stipulation also provided that in the event that either party defaulted with respect to their obligations thereunder, that party would be responsible for paying the attorney's fee incurred by the other party in an enforcement proceeding. The Family Court correctly concluded that the parties' failure to agree on a modified visitation schedule once their child began school did not constitute a "default" under the terms of the stipulation. Accordingly, the Family Court properly denied the mother's motion for an award of an attorney's fee.
Wednesday, June 15, 2011
Wednesday, June 01, 2011
Important New Decisions - June 1, 2011
Family Court's Determination That the Subject Child Was Emancipated Pursuant to the Terms of the Parties' Stipulation Did Not Preclude the Subject Child from Filing His Own Support Petition
In Wakefield v Wakefield, --- N.Y.S.2d ----, 2011 WL 2089752 (N.Y.A.D. 2 Dept.) the parties October 2006 stipulation of settlement, which was incorporated but not merged into their judgment of divorce provided for joint legal custody of their two children. It further provided that the mother would have physical custody of the children and that both parents would provide child support until the happening of an emancipating event, which included either of the children's "permanent residence away from the residence of the wife." The parties were divorced on January 29, 2007, and, in October 2008, the subject child moved from his mother's home to the father's home. In March 2009 the father filed a petition seeking to modify the support provisions of the stipulation of settlement so as to receive child support from the mother, upon the ground that the subject child was living with him. After a hearing, the Support Magistrate granted the petition, finding that the subject child's residence with the father constituted a change in circumstances warranting an award of child support to the father. Family Court granted the mother's objections to the extent of "deeming" the subject child to be emancipated pursuant to the parties' stipulation, and dismissed the father's petition. On September 24, 2009, the subject child filed his own petition seeking support from his mother. At a hearing on the petition, both the subject child and the father testified that the subject child was 18 years old, that he lived with the father, and that he attended Suffolk Community College full time. In an order dated February 8, 2010, the Support Magistrate granted the subject child's support petition. Family Court denied the mother's objection to the order dated February 8, 2010, rejecting her contention that the subject child was emancipated and, not entitled to child support. It also rejected the mother's contentions that the award was not based upon adequate evidence, and that a child who commences a support proceeding on his or her own behalf may not be awarded an attorney's fee. The Appellate Division held that the Family Court's determination that the subject child was emancipated pursuant to the terms of the parties' stipulation did not preclude the subject child from filing his own support petition. "A husband and wife, in entering into a separation agreement, may include in that agreement provisions pertaining to the support of the children of their marriage. The terms, like any other contract clauses, are binding on the parties to the agreement. The child, on the other hand, is not bound by the terms of the agreement ... and an action may be commenced against [a parent] for child support despite the existence of the agreement" (citing Matter of Boden v. Boden, 42 N.Y.2d 210, 212). Since the subject child moved from his mother's residence to the father's residence with his parents' consent, the subject child was entitled to adequate support from his mother. It also held that the Family Court properly rejected the mother's contention that the child was not entitled to an award of an attorney's fee (citing Family Ct Act 422 [a], 438[a] ).
Motions to Enforce the Terms of a Stipulation of Settlement Are Not Subject to Statutes of Limitation. An Application or Motion for the Issuance of a QDRO Is Not Barred by the Statute of Limitations
In Denaro v Denaro, --- N.Y.S.2d ----, 2011 WL 2090821 (N.Y.A.D. 2 Dept.) the plaintiff former wife and the defendant former husband, who was a police officer employed by the New York City Police Department, were married in 1981. By a judgment entered July 2, 1997, they were granted an uncontested divorce. In a Stipulation and Agreement of Settlement, which was incorporated but not merged into the judgment of divorce, the parties agreed that the plaintiff would be entitled to a certain percentage of the marital portion of the defendant's police retirement benefits. The parties acknowledged in the stipulation that a valuation of those benefits had been performed, and they agreed that that valuation would "be utilized to prepare a Qualified Domestic Relations Order to be submitted to the Court as soon as practicable after the Judgment of Divorce is signed." No Qualified Domestic Relations Order was submitted at that time. The defendant retired from the NYPD in 2003, after 20 years of service, and he began collecting his pension. In January 2010 the plaintiff submitted a proposed QDRO to the Supreme Court, requesting the Supreme Court to enforce the stipulation to the extent of issuing an appropriate QDRO. The defendant moved to vacate the retirement provision of the stipulation. Supreme Court granted the plaintiff's application and denied the defendant's motion. The Appellate Division held that contrary to the defendant's contention, the statute of limitations does not bar issuance of the QDRO. It held that motions to enforce the terms of a stipulation of settlement are not subject to statutes of limitation.. Because a QDRO is derived from the bargain struck by the parties at the time of the judgment of divorce, there is no need to commence a separate 'action' in order for the court to formalize the agreement between the parties in the form of a QDRO. It pointed out that the Court had expressly held that an application or motion for the issuance of a QDRO is not barred by the statute of limitations (citing Bayen v. Bayen, 81 AD3d at 866-867). The defendant also contended that the plaintiff's failure to submit the QDRO to the Court within 60 days of entry of the divorce judgment (see 22 NYCRR 202.48) barred its issuance thereafter. The Appellate Division found defendant's contention to be without merit because that court rule does not apply to a QDRO, which is merely a mechanism to effectuate payment of a party's share in a retirement plan. The plaintiff's right to her share of the defendant's pension was created by the stipulation and the judgment of divorce, and it was not abandoned when the QDRO was not filed within 60 days. It also rejected the defendant's claim that the doctrine of laches barred the plaintiff's entitlement to the QDRO. Invocation of laches requires a showing of both delay and prejudice. The delay in submitting a QDRO for execution was lengthy, but the defendant had not shown any prejudice to himself resulting from the plaintiff's delay. The Court also rejected defendant's claim that the plaintiff waived her right to her share of the defendant's retirement benefits. The plaintiff's delay in submitting the QDRO to the Supreme Court did not evince an intent to waive her rights. Waiver does not result from negligence, oversight, or inattention, and it may not be inferred merely from silence.
An Interim Restraint on the Disposition or Encumbrance of Property Should Not Be Imposed Absent a Demonstration That the Party to Be Restrained Has Done, or Is Threatening to Do, an Act Which Would Prejudice the Movant's Equitable Distribution Claim.
In Many V Many, --- N.y.s.2d ----, 2011 Wl 1902259 (N.y.a.d. 2 Dept. The Wife Appealed from an Order Denying Her Motion to Restrain the Defendant Husband from Encumbering the Marital Residence, and in Effect, Authorized the Defendant to Refinance the Equity in the Marital Residence and to Use Any Funds Obtained Therefrom for the Sole Purpose of Paying His Pendente Lite Maintenance Obligation. The Order Also Directed the Defendant to Pay Arrears for His Pendente Lite Maintenance Obligation Retroactive to Only February 1, 2010, and Awarded Her an Attorney's Fee of $15,000. The Appellate Division Held That Supreme Court Did Not Improvidently Exercise its Discretion in Failing to Restrain the Defendant Husband from Encumbering the Marital Residence. It Pointed out That an Interim Restraint on the Disposition or Encumbrance of Property Should Not Be Imposed Absent a Demonstration That the Party to Be Restrained Has Done, or Is Threatening to Do, an Act Which Would Prejudice the Movant's Equitable Distribution Claim. Here, No Evidence Indicated That the Defendant Had Done, or Was Threatening to Do, an Act That Would Threaten the Plaintiff's Equitable Distribution Claim. The Court Noted That While the Plaintiff May Be Entitled to an Equitable Share of the Value of the Marital Residence, That Issue Had Yet to Be Adjudicated. At a Later Date, the Supreme Court Would Be Able to Ensure That the Plaintiff Was Reimbursed for Her Equitable Share of Any Funds Used by the Defendant as a Result of the Sale or Refinancing of the Marital Residence to Meet His Pendente Lite Maintenance Obligation.
Family Court Act Provides for the Award of an Attorney's Fee Only to a Prevailing Party in a Violation Proceeding
In Matter of Shvetsova v Paderno, --- N.Y.S.2d ----, 2011 WL 1902198 (N.Y.A.D. 2 Dept.) the father appealed from an order of the Family Court which denied his objection to an order of the Court which granted the mother's motion for an award of an attorney's fee and awarded her $11,500. The Appellate Division observed that the attorney's fee at issue was awarded to the mother for legal fees she incurred in defending against the father's petition for a downward modification of his child support obligation, and in prosecuting her petition to hold the father in civil contempt for his alleged violation of a prior support order. In a related appeal, it reversed the Family Court's denial of the father's petition for downward modification of his child support obligation and remitted the matter to the Family Court for a new determination of the father's child support obligation and arrears. In light of the decision and order in the related appeal, it reversed the award of an attorney's fee to the mother insofar as it was in connection with her defense against the father's petition. In addition, in the same related appeal, it reversed the Family Court's finding that the father willfully violated the prior support order. Therefore, although the Family Court Act provides for the award of an attorney's fee to a prevailing party in connection with a violation proceeding (see Family Ct Act 438 [b] ), here, the mother was not entitled to such an award. Accordingly, it directed that after the Support Magistrate makes a new determination of the father's petition for a downward modification of his child support obligation, in accordance with its decision and order in the related appeal, the Support Magistrate shall make a new determination on the mother's motion for an award of an attorney's fee. Any award of an attorney's fee, if warranted, shall be limited to fees incurred in connection with the mother's defense against the father's petition.
Family Court Act 1028 Hearing Is Triggered by the Removal of a Child from the Home
In Matter of Lucinda R, --- N.Y.S.2d ----, 2011 WL 1902203 (N.Y.A.D. 2 Dept.) the question presented on this appeal was whether a Family Court Act 1028 hearing is triggered by the removal of a child from the home of one parent and temporary placement into the custody of another parent or relative, or whether such hearing is triggered only where a child is placed into government-administered foster care. The Appellate Division concluded that the Family Court erred in denying the mother's application for a hearing under Family Court Act 1028. In relevant part, that section provides: "(a) Upon the application of the parent or other person legally responsible for the care of a child temporarily removed under this part or upon the application of the [attorney for the child] for an order returning the child, the court shall hold a hearing to determine whether the child should be returned (i) unless there has been a hearing pursuant to [Family Court Act 1027] on the removal of the child at which the parent or other person legally responsible for the child's care was present and had the opportunity to be represented by counsel, or (ii) upon good cause shown. Except for good cause shown, such hearing shall be held within three court days of the application and shall not be adjourned." The disposition of the mother's application here turned on the meaning of the word "removal," as used in the statute. The Family Court found that there was no removal within the meaning of Family Court Act 1028 because "when a child is moved from the [petitioner's] home to the non respondent father's home [,] that ... is not a removal and it does not generate a basis for a 1028 hearing." The Family Court reasoned that "1028 hearings protect the primacy of parental right[s] as against the state, not as against the parent vs. parent."
Justice Belen wrote that the Appellate Division disagreed. In assessing the Family Court's interpretation of the statute, it begins with the language of the statute itself, "as the statutory text is the clearest indicator of legislative intent. If the terms of the statute are clear and unambiguous, the court should construe it so as to give effect to the plain meaning of the words used. On its face, Family Court Act 1028 does not limit a hearing only to parents whose children have been placed in the custody of a governmental agency. There is no qualification to its application whatsoever. It plainly and simply states that, upon the application of a parent of a child who has been temporarily removed, the court shall hold a hearing to determine whether the child should be returned, and this must be done within three court days without adjournment. The Court pointed that that these rules of strict construction, however, cannot be applied without regard to the statute as a whole, as its various sections must be considered together and with reference to each other. The purpose of article 10 of the Family Court Act is to provide a due process of law for determining when the state, through its family court, may intervene against the wishes of a parent on behalf of a child so that the child's needs are properly met. (Family Ct Act 1011). The Appellate Division held that the Family Court's finding of a legal distinction between a child's removal from the home and placement in the custody of another parent, on one hand, and placement in the custody of a governmental agency, on the other hand, was illusory. In either case, it is the State acting within its parens patriae power effectuating that transfer and removal. Accordingly, the Court found that that the applicability of a Family Court Act 1028 hearing is not dependent on whether the child removed is placed with another parent or whether the child is placed in foster care. In sum, the trigger is that the State has acted to effectuate the removal of the child from the home and placed him or her in the custody of another.
Allegations of a Family Offense Are Not Subject to the Defense of Laches or Statute of Limitations. The Issue in Family Offense Matters Is Not the Age of the Threat but the Imminence of the Danger.
In Matter of Opray v Fitzharris, --- N.Y.S.2d ----, 2011 WL 1902204 (N.Y.A.D. 2 Dept.), the wife initiated a family offense proceeding on or about April 7, 2010, alleging that the husband committed the family offenses of assault and aggravated harassment during various incidents occurring in April 2001 and December 2006, as well as on January 6, 2010, April 3, 2010, and April 6, 2010. The Appellate Division held that the Family Court properly dismissed allegations in the petition regarding incidents alleged to have occurred in April 2001 and December 2006. It pointed out that allegations of a family offense are not subject to the defense of laches or statute of limitations (citing Matter of Ashley P., 31 AD3d 767, 769; Matter of Nina K. v. Victor K., 195 Misc.2d 726, 727). The issue in family offense matters is not the age of the threat but the imminence of the danger. (Matter of Nina K. v. Victor K., 195 Misc.2d at 727). Here, in addition to the remoteness of the allegations, the Family Court properly determined that they did not bear upon the existence of an "immediate and ongoing danger" to the wife or children (see Family Ct Act 827). However, it found that the Family Court erred in determining that the wife failed to establish a prima facie case of aggravated harassment with respect to the incident alleged to have occurred on April 6, 2010. In determining a motion to dismiss for failure to establish a prima facie case, the evidence must be accepted as true and given the benefit of every reasonable inference which may be drawn therefrom. The question of credibility is irrelevant, and should not be considered. Here, viewing the wife's testimony in the light most favorable to her, and accepting her testimony as true, the wife failed to establish a prima facie case of assault in the third degree or aggravated harassment in the second degree with respect to the incident alleged to have occurred January 6, 2010. The wife did, however, establish a prima facie case of aggravated harassment in the second degree based on her testimony that during a telephone conversation on April 6, 2010, the husband threatened, among other things, to find her and kidnap the children (see Penal Law 240.30[1][a] ). The petition was reinstated and the matter remitted to the Family Court, for a new fact-finding hearing and for a new determination of the petition with respect to the allegations regarding the events of April 6, 2010.
Defense of Action for Fraudulent Misrepresentation Is Not an Enforcement of Rights Within Meaning of Counsel Fee Provision of Agreement
In Etzion v Etzion, --- N.Y.S.2d ----, 2011 WL 1902589 (N.Y.A.D. 2 Dept.), an action, inter alia, to recover damages for fraudulent misrepresentation in connection with negotiations relating to a stipulation of settlement dated June 8, 2005, which was incorporated, but not merged, into the parties August 16, 2005 judgment of divorce, the facts of the action were set forth in the decision and order on a prior appeal (see Etzion v. Etzion, 62 AD3d 646). On this appeal, the plaintiff contended that the Supreme Court erred in denying her motion pursuant to CPLR 3211(a)(1) and (7) to dismiss a counterclaim asserted by the defendant former husband, Rafael Etzion (defendant), for an award of an attorney's fee pursuant to the terms of a stipulation of settlement entered into by the defendant and the plaintiff on June 8, 2005, or, in the alternative, for summary judgment dismissing the counterclaim. The Appellate Divison observed that the fundamental, neutral precept of contract interpretation is that agreements are construed in accord with the parties' intent. Where the contract is clear and unambiguous on its face, the intent of the parties must be gleaned from within the four corners of the instrument, and not from extrinsic evidence. Thus, a written agreement that is complete, clear and unambiguous on its face must be enforced according to the plain meaning of its terms. Courts may not by construction add or excise terms, nor distort the meaning of those used and thereby make a new contract for the parties under the guise of interpreting the writing. Thus, a court will not imply a term where the circumstances surrounding the formation of the contract indicate that the parties, when the contract was made, must have foreseen the contingency at issue and the agreement can be enforced according to its terms. The construction and interpretation of an unambiguous written contract is an issue of law within the province of the court. It found that the defendant's counterclaim for an award of an attorney's fee was based on an overbroad reading of an attorney's fee provision in the parties' stipulation of settlement executed on June 8, 2005 which was subsequently incorporated, but not merged, into their judgment of divorce. The parties' separation agreement, at Article XXV, paragraph 3, stated, in relevant part: "In the event either party is forced to seek aid of counsel in enforcing any rights pursuant to this Stipulation, and in the event that party is successful in enforcing such right(s), the other shall reimburse him or her for any reasonable attorneys' fees necessarily incurred in enforcing such rights. The provisions of this paragraph shall be in addition, and without prejudice or limitation, to any other rights or remedies to which the aggrieved party may be entitled. The parties agree that the purpose of this paragraph is to prevent unnecessary litigation between them and to encourage each to fulfill his or her responsibilities under the terms of this Stipulation as fully as possible" The defendant, in his counterclaim, asserted that he was entitled to an award of an attorney's fee pursuant to the fees provision because he had been forced, in effect, to defend his rights under the separation agreement. However, the agreement clearly and unambiguously provided that only the party seeking to enforce any rights under the agreement shall be entitled to an attorney's fee, if successful. The defendant was not enforcing any rights under the agreement by simply defending against the plaintiff's motion. Had the parties intended the fees provision to be construed as the defendant contended, they were free to expressly so provide. The Court pointed out that where documentary evidence utterly refutes the proponent's factual allegations, conclusively establishing a defense as a matter of law, a motion to dismiss may be properly granted. Based upon the documentary evidence, consisting of the agreement, the plaintiff conclusively established, as a matter of law, that the defendant was not entitled to an award of an attorney's fee, regardless of the outcome of the current dispute. Accordingly, the Supreme Court erred in denying the plaintiff's motion to dismiss the defendant's counterclaim pursuant to CPLR 3211 (a)(1).
Stipulation Void as Against Public Policy, since it Expressly Required the Former Wife to Seek Dissolution of the Marriage and "Provided for the Procurement of Grounds of Divorce
In Charap v Willett, --- N.Y.S.2d ----, 2011 WL 1902605 (N.Y.A.D. 2 Dept.), the parties were divorced by judgment dated March 30, 2009. In a related appeal the Appellate Diviison affirmed the judgment of divorce insofar as appealed from. The former wife initially contested the divorce action commenced in 2003. After a nonjury trial, the Supreme Court determined that the former husband failed to prove his alleged grounds for divorce. The parties then entered into a custody agreement and the former wife filed an amended answer dated May 7, 2007, containing a counterclaim for a divorce on the ground of cruel and inhuman treatment. The former husband waived his reply and, while neither admitting nor denying the allegations, consented to the former wife obtaining a divorce on that ground. A nonjury trial was held on the financial issues, and a judgment of divorce was issued on March 30, 2009. By order to show cause dated July 29, 2009, the former wife moved, inter alia, to direct the former husband to comply with a theretofore confidential stipulation between the parties dated May 7, 2007, and to pay back maintenance and child support in the sum of $13,587.61, plus interest. The stipulation was subscribed by the parties and notarized, but, in accordance with its provisions, was kept confidential from the court during the trial on financial issues. In the stipulation, the former husband agreed, inter alia, to pay the former wife $65,000 over and above a future equitable distribution award, and to pay her counsel $10,000. In exchange, the former wife agreed to promptly prepare an amended answer and counterclaim for a divorce alleging cruel and inhuman treatment. As soon as the court placed the matter on its calendar, the parties would proceed to inquest whereby the grounds for a divorce would be finally and irrevocably determined. The Supreme Court denied the former wife's motion, finding the stipulation unenforceable and her claim of entitlement to back maintenance and child support without merit. The Appellate Divison affirmed. It held that the May 7, 2007, stipulation was void as against public policy, since it expressly required the former wife to seek dissolution of the marriage and "provides for the procurement of grounds of divorce" (General Obligations Law 5-311). As the offending provision represented the only consideration provided by the former wife for the agreement, which did not contain a severability provision, the stipulation was void in its entirety (cf. Taft v. Taft, 156 A.D.2d 444).
Supreme Court providently imputed $200,000 per year in income to the former wife, an attorney, for child support purposes.
In Charap v Willett, --- N.Y.S.2d ----, 2011 WL 1902606 (N.Y.A.D. 2 Dept.) the parties were married in 1982. There were two children of the marriage, born in 1990 and 1995, respectively. The former husband left the marital residence in December 2002 and commenced this action for a divorce on March 17, 2003. After a nonjury trial on grounds for divorce, the Supreme Court determined that the former husband failed to prove his alleged grounds for divorce. On May 7, 2007, the parties entered into a "Stipulation as to Custody, Decision-Making and Parental Access," and the former wife filed an amended answer containing a counterclaim for divorce on the ground of cruel and inhuman treatment. The former husband waived his reply and, while neither admitting or denying the allegations, consented to the former wife obtaining a divorce on that ground. After an inquest, the divorce was granted, but entry of the divorce judgment was held in abeyance pending the resolution of ancillary issues. The matter was transferred for trial on the remaining financial issues. After a nonjury trial, the Supreme Court, inter alia, distributed the marital estate and directed the former husband to pay the former wife durational maintenance in the sum of $5,000 per month for two years. The court also imputed income to the former wife for child support purposes, pro-rated the parties' obligations, and directed the former husband to pay the former wife $3,859.34 per month in child support, plus direct payments of the children's college expenses and other add-ons. The Appellate Divison affirmed. It held that Supreme Court properly rejected the former wife's request for lifetime maintenance. First, a purported agreement dated March 19, 2001, which provided, inter alia, that the former wife would not be required to work outside the family home during a divorce, was ambiguous as to duration and, in any event, was not enforceable (see Domestic Relations Law 236[B][3] ). Moreover, the former wife was an attorney who practiced law for almost 20 years and was capable of earning a significant salary. Given her skills, experience, and the children's mature ages, the Supreme Court appropriately limited maintenance to $5,000 per month for a period of two years. It also held that Supreme Court providently imputed $200,000 per year in income to the former wife for child support purposes. Child support is determined by the parents' ability to provide for their child rather than their current economic situation. In determining a party's child support obligation, the court 'need not rely upon the party's own account of his or her finances, but may impute income based upon the party's past income or demonstrated earning potential. Courts are afforded considerable discretion in determining whether to impute income to a parent. Here, given the former wife's education, experience, and salary history, the imputed sum was supported by the record. Further, the court properly considered the statutory factors in capping the combined parental income at $300,000 for child support purposes, and there was no basis in this record for disturbing its determination. It held that Supreme Court providently awarded the former wife only 10% of the value of the former husband's law practice. The former wife made only indirect contributions to the former husband's career and was herself employed as an attorney for most of the marriage. The Supreme Court providently exercised its discretion in denying the former wife's application for counsel fees, as she received a large distributive award and had a substantial earning capacity.
In Wakefield v Wakefield, --- N.Y.S.2d ----, 2011 WL 2089752 (N.Y.A.D. 2 Dept.) the parties October 2006 stipulation of settlement, which was incorporated but not merged into their judgment of divorce provided for joint legal custody of their two children. It further provided that the mother would have physical custody of the children and that both parents would provide child support until the happening of an emancipating event, which included either of the children's "permanent residence away from the residence of the wife." The parties were divorced on January 29, 2007, and, in October 2008, the subject child moved from his mother's home to the father's home. In March 2009 the father filed a petition seeking to modify the support provisions of the stipulation of settlement so as to receive child support from the mother, upon the ground that the subject child was living with him. After a hearing, the Support Magistrate granted the petition, finding that the subject child's residence with the father constituted a change in circumstances warranting an award of child support to the father. Family Court granted the mother's objections to the extent of "deeming" the subject child to be emancipated pursuant to the parties' stipulation, and dismissed the father's petition. On September 24, 2009, the subject child filed his own petition seeking support from his mother. At a hearing on the petition, both the subject child and the father testified that the subject child was 18 years old, that he lived with the father, and that he attended Suffolk Community College full time. In an order dated February 8, 2010, the Support Magistrate granted the subject child's support petition. Family Court denied the mother's objection to the order dated February 8, 2010, rejecting her contention that the subject child was emancipated and, not entitled to child support. It also rejected the mother's contentions that the award was not based upon adequate evidence, and that a child who commences a support proceeding on his or her own behalf may not be awarded an attorney's fee. The Appellate Division held that the Family Court's determination that the subject child was emancipated pursuant to the terms of the parties' stipulation did not preclude the subject child from filing his own support petition. "A husband and wife, in entering into a separation agreement, may include in that agreement provisions pertaining to the support of the children of their marriage. The terms, like any other contract clauses, are binding on the parties to the agreement. The child, on the other hand, is not bound by the terms of the agreement ... and an action may be commenced against [a parent] for child support despite the existence of the agreement" (citing Matter of Boden v. Boden, 42 N.Y.2d 210, 212). Since the subject child moved from his mother's residence to the father's residence with his parents' consent, the subject child was entitled to adequate support from his mother. It also held that the Family Court properly rejected the mother's contention that the child was not entitled to an award of an attorney's fee (citing Family Ct Act 422 [a], 438[a] ).
Motions to Enforce the Terms of a Stipulation of Settlement Are Not Subject to Statutes of Limitation. An Application or Motion for the Issuance of a QDRO Is Not Barred by the Statute of Limitations
In Denaro v Denaro, --- N.Y.S.2d ----, 2011 WL 2090821 (N.Y.A.D. 2 Dept.) the plaintiff former wife and the defendant former husband, who was a police officer employed by the New York City Police Department, were married in 1981. By a judgment entered July 2, 1997, they were granted an uncontested divorce. In a Stipulation and Agreement of Settlement, which was incorporated but not merged into the judgment of divorce, the parties agreed that the plaintiff would be entitled to a certain percentage of the marital portion of the defendant's police retirement benefits. The parties acknowledged in the stipulation that a valuation of those benefits had been performed, and they agreed that that valuation would "be utilized to prepare a Qualified Domestic Relations Order to be submitted to the Court as soon as practicable after the Judgment of Divorce is signed." No Qualified Domestic Relations Order was submitted at that time. The defendant retired from the NYPD in 2003, after 20 years of service, and he began collecting his pension. In January 2010 the plaintiff submitted a proposed QDRO to the Supreme Court, requesting the Supreme Court to enforce the stipulation to the extent of issuing an appropriate QDRO. The defendant moved to vacate the retirement provision of the stipulation. Supreme Court granted the plaintiff's application and denied the defendant's motion. The Appellate Division held that contrary to the defendant's contention, the statute of limitations does not bar issuance of the QDRO. It held that motions to enforce the terms of a stipulation of settlement are not subject to statutes of limitation.. Because a QDRO is derived from the bargain struck by the parties at the time of the judgment of divorce, there is no need to commence a separate 'action' in order for the court to formalize the agreement between the parties in the form of a QDRO. It pointed out that the Court had expressly held that an application or motion for the issuance of a QDRO is not barred by the statute of limitations (citing Bayen v. Bayen, 81 AD3d at 866-867). The defendant also contended that the plaintiff's failure to submit the QDRO to the Court within 60 days of entry of the divorce judgment (see 22 NYCRR 202.48) barred its issuance thereafter. The Appellate Division found defendant's contention to be without merit because that court rule does not apply to a QDRO, which is merely a mechanism to effectuate payment of a party's share in a retirement plan. The plaintiff's right to her share of the defendant's pension was created by the stipulation and the judgment of divorce, and it was not abandoned when the QDRO was not filed within 60 days. It also rejected the defendant's claim that the doctrine of laches barred the plaintiff's entitlement to the QDRO. Invocation of laches requires a showing of both delay and prejudice. The delay in submitting a QDRO for execution was lengthy, but the defendant had not shown any prejudice to himself resulting from the plaintiff's delay. The Court also rejected defendant's claim that the plaintiff waived her right to her share of the defendant's retirement benefits. The plaintiff's delay in submitting the QDRO to the Supreme Court did not evince an intent to waive her rights. Waiver does not result from negligence, oversight, or inattention, and it may not be inferred merely from silence.
An Interim Restraint on the Disposition or Encumbrance of Property Should Not Be Imposed Absent a Demonstration That the Party to Be Restrained Has Done, or Is Threatening to Do, an Act Which Would Prejudice the Movant's Equitable Distribution Claim.
In Many V Many, --- N.y.s.2d ----, 2011 Wl 1902259 (N.y.a.d. 2 Dept. The Wife Appealed from an Order Denying Her Motion to Restrain the Defendant Husband from Encumbering the Marital Residence, and in Effect, Authorized the Defendant to Refinance the Equity in the Marital Residence and to Use Any Funds Obtained Therefrom for the Sole Purpose of Paying His Pendente Lite Maintenance Obligation. The Order Also Directed the Defendant to Pay Arrears for His Pendente Lite Maintenance Obligation Retroactive to Only February 1, 2010, and Awarded Her an Attorney's Fee of $15,000. The Appellate Division Held That Supreme Court Did Not Improvidently Exercise its Discretion in Failing to Restrain the Defendant Husband from Encumbering the Marital Residence. It Pointed out That an Interim Restraint on the Disposition or Encumbrance of Property Should Not Be Imposed Absent a Demonstration That the Party to Be Restrained Has Done, or Is Threatening to Do, an Act Which Would Prejudice the Movant's Equitable Distribution Claim. Here, No Evidence Indicated That the Defendant Had Done, or Was Threatening to Do, an Act That Would Threaten the Plaintiff's Equitable Distribution Claim. The Court Noted That While the Plaintiff May Be Entitled to an Equitable Share of the Value of the Marital Residence, That Issue Had Yet to Be Adjudicated. At a Later Date, the Supreme Court Would Be Able to Ensure That the Plaintiff Was Reimbursed for Her Equitable Share of Any Funds Used by the Defendant as a Result of the Sale or Refinancing of the Marital Residence to Meet His Pendente Lite Maintenance Obligation.
Family Court Act Provides for the Award of an Attorney's Fee Only to a Prevailing Party in a Violation Proceeding
In Matter of Shvetsova v Paderno, --- N.Y.S.2d ----, 2011 WL 1902198 (N.Y.A.D. 2 Dept.) the father appealed from an order of the Family Court which denied his objection to an order of the Court which granted the mother's motion for an award of an attorney's fee and awarded her $11,500. The Appellate Division observed that the attorney's fee at issue was awarded to the mother for legal fees she incurred in defending against the father's petition for a downward modification of his child support obligation, and in prosecuting her petition to hold the father in civil contempt for his alleged violation of a prior support order. In a related appeal, it reversed the Family Court's denial of the father's petition for downward modification of his child support obligation and remitted the matter to the Family Court for a new determination of the father's child support obligation and arrears. In light of the decision and order in the related appeal, it reversed the award of an attorney's fee to the mother insofar as it was in connection with her defense against the father's petition. In addition, in the same related appeal, it reversed the Family Court's finding that the father willfully violated the prior support order. Therefore, although the Family Court Act provides for the award of an attorney's fee to a prevailing party in connection with a violation proceeding (see Family Ct Act 438 [b] ), here, the mother was not entitled to such an award. Accordingly, it directed that after the Support Magistrate makes a new determination of the father's petition for a downward modification of his child support obligation, in accordance with its decision and order in the related appeal, the Support Magistrate shall make a new determination on the mother's motion for an award of an attorney's fee. Any award of an attorney's fee, if warranted, shall be limited to fees incurred in connection with the mother's defense against the father's petition.
Family Court Act 1028 Hearing Is Triggered by the Removal of a Child from the Home
In Matter of Lucinda R, --- N.Y.S.2d ----, 2011 WL 1902203 (N.Y.A.D. 2 Dept.) the question presented on this appeal was whether a Family Court Act 1028 hearing is triggered by the removal of a child from the home of one parent and temporary placement into the custody of another parent or relative, or whether such hearing is triggered only where a child is placed into government-administered foster care. The Appellate Division concluded that the Family Court erred in denying the mother's application for a hearing under Family Court Act 1028. In relevant part, that section provides: "(a) Upon the application of the parent or other person legally responsible for the care of a child temporarily removed under this part or upon the application of the [attorney for the child] for an order returning the child, the court shall hold a hearing to determine whether the child should be returned (i) unless there has been a hearing pursuant to [Family Court Act 1027] on the removal of the child at which the parent or other person legally responsible for the child's care was present and had the opportunity to be represented by counsel, or (ii) upon good cause shown. Except for good cause shown, such hearing shall be held within three court days of the application and shall not be adjourned." The disposition of the mother's application here turned on the meaning of the word "removal," as used in the statute. The Family Court found that there was no removal within the meaning of Family Court Act 1028 because "when a child is moved from the [petitioner's] home to the non respondent father's home [,] that ... is not a removal and it does not generate a basis for a 1028 hearing." The Family Court reasoned that "1028 hearings protect the primacy of parental right[s] as against the state, not as against the parent vs. parent."
Justice Belen wrote that the Appellate Division disagreed. In assessing the Family Court's interpretation of the statute, it begins with the language of the statute itself, "as the statutory text is the clearest indicator of legislative intent. If the terms of the statute are clear and unambiguous, the court should construe it so as to give effect to the plain meaning of the words used. On its face, Family Court Act 1028 does not limit a hearing only to parents whose children have been placed in the custody of a governmental agency. There is no qualification to its application whatsoever. It plainly and simply states that, upon the application of a parent of a child who has been temporarily removed, the court shall hold a hearing to determine whether the child should be returned, and this must be done within three court days without adjournment. The Court pointed that that these rules of strict construction, however, cannot be applied without regard to the statute as a whole, as its various sections must be considered together and with reference to each other. The purpose of article 10 of the Family Court Act is to provide a due process of law for determining when the state, through its family court, may intervene against the wishes of a parent on behalf of a child so that the child's needs are properly met. (Family Ct Act 1011). The Appellate Division held that the Family Court's finding of a legal distinction between a child's removal from the home and placement in the custody of another parent, on one hand, and placement in the custody of a governmental agency, on the other hand, was illusory. In either case, it is the State acting within its parens patriae power effectuating that transfer and removal. Accordingly, the Court found that that the applicability of a Family Court Act 1028 hearing is not dependent on whether the child removed is placed with another parent or whether the child is placed in foster care. In sum, the trigger is that the State has acted to effectuate the removal of the child from the home and placed him or her in the custody of another.
Allegations of a Family Offense Are Not Subject to the Defense of Laches or Statute of Limitations. The Issue in Family Offense Matters Is Not the Age of the Threat but the Imminence of the Danger.
In Matter of Opray v Fitzharris, --- N.Y.S.2d ----, 2011 WL 1902204 (N.Y.A.D. 2 Dept.), the wife initiated a family offense proceeding on or about April 7, 2010, alleging that the husband committed the family offenses of assault and aggravated harassment during various incidents occurring in April 2001 and December 2006, as well as on January 6, 2010, April 3, 2010, and April 6, 2010. The Appellate Division held that the Family Court properly dismissed allegations in the petition regarding incidents alleged to have occurred in April 2001 and December 2006. It pointed out that allegations of a family offense are not subject to the defense of laches or statute of limitations (citing Matter of Ashley P., 31 AD3d 767, 769; Matter of Nina K. v. Victor K., 195 Misc.2d 726, 727). The issue in family offense matters is not the age of the threat but the imminence of the danger. (Matter of Nina K. v. Victor K., 195 Misc.2d at 727). Here, in addition to the remoteness of the allegations, the Family Court properly determined that they did not bear upon the existence of an "immediate and ongoing danger" to the wife or children (see Family Ct Act 827). However, it found that the Family Court erred in determining that the wife failed to establish a prima facie case of aggravated harassment with respect to the incident alleged to have occurred on April 6, 2010. In determining a motion to dismiss for failure to establish a prima facie case, the evidence must be accepted as true and given the benefit of every reasonable inference which may be drawn therefrom. The question of credibility is irrelevant, and should not be considered. Here, viewing the wife's testimony in the light most favorable to her, and accepting her testimony as true, the wife failed to establish a prima facie case of assault in the third degree or aggravated harassment in the second degree with respect to the incident alleged to have occurred January 6, 2010. The wife did, however, establish a prima facie case of aggravated harassment in the second degree based on her testimony that during a telephone conversation on April 6, 2010, the husband threatened, among other things, to find her and kidnap the children (see Penal Law 240.30[1][a] ). The petition was reinstated and the matter remitted to the Family Court, for a new fact-finding hearing and for a new determination of the petition with respect to the allegations regarding the events of April 6, 2010.
Defense of Action for Fraudulent Misrepresentation Is Not an Enforcement of Rights Within Meaning of Counsel Fee Provision of Agreement
In Etzion v Etzion, --- N.Y.S.2d ----, 2011 WL 1902589 (N.Y.A.D. 2 Dept.), an action, inter alia, to recover damages for fraudulent misrepresentation in connection with negotiations relating to a stipulation of settlement dated June 8, 2005, which was incorporated, but not merged, into the parties August 16, 2005 judgment of divorce, the facts of the action were set forth in the decision and order on a prior appeal (see Etzion v. Etzion, 62 AD3d 646). On this appeal, the plaintiff contended that the Supreme Court erred in denying her motion pursuant to CPLR 3211(a)(1) and (7) to dismiss a counterclaim asserted by the defendant former husband, Rafael Etzion (defendant), for an award of an attorney's fee pursuant to the terms of a stipulation of settlement entered into by the defendant and the plaintiff on June 8, 2005, or, in the alternative, for summary judgment dismissing the counterclaim. The Appellate Divison observed that the fundamental, neutral precept of contract interpretation is that agreements are construed in accord with the parties' intent. Where the contract is clear and unambiguous on its face, the intent of the parties must be gleaned from within the four corners of the instrument, and not from extrinsic evidence. Thus, a written agreement that is complete, clear and unambiguous on its face must be enforced according to the plain meaning of its terms. Courts may not by construction add or excise terms, nor distort the meaning of those used and thereby make a new contract for the parties under the guise of interpreting the writing. Thus, a court will not imply a term where the circumstances surrounding the formation of the contract indicate that the parties, when the contract was made, must have foreseen the contingency at issue and the agreement can be enforced according to its terms. The construction and interpretation of an unambiguous written contract is an issue of law within the province of the court. It found that the defendant's counterclaim for an award of an attorney's fee was based on an overbroad reading of an attorney's fee provision in the parties' stipulation of settlement executed on June 8, 2005 which was subsequently incorporated, but not merged, into their judgment of divorce. The parties' separation agreement, at Article XXV, paragraph 3, stated, in relevant part: "In the event either party is forced to seek aid of counsel in enforcing any rights pursuant to this Stipulation, and in the event that party is successful in enforcing such right(s), the other shall reimburse him or her for any reasonable attorneys' fees necessarily incurred in enforcing such rights. The provisions of this paragraph shall be in addition, and without prejudice or limitation, to any other rights or remedies to which the aggrieved party may be entitled. The parties agree that the purpose of this paragraph is to prevent unnecessary litigation between them and to encourage each to fulfill his or her responsibilities under the terms of this Stipulation as fully as possible" The defendant, in his counterclaim, asserted that he was entitled to an award of an attorney's fee pursuant to the fees provision because he had been forced, in effect, to defend his rights under the separation agreement. However, the agreement clearly and unambiguously provided that only the party seeking to enforce any rights under the agreement shall be entitled to an attorney's fee, if successful. The defendant was not enforcing any rights under the agreement by simply defending against the plaintiff's motion. Had the parties intended the fees provision to be construed as the defendant contended, they were free to expressly so provide. The Court pointed out that where documentary evidence utterly refutes the proponent's factual allegations, conclusively establishing a defense as a matter of law, a motion to dismiss may be properly granted. Based upon the documentary evidence, consisting of the agreement, the plaintiff conclusively established, as a matter of law, that the defendant was not entitled to an award of an attorney's fee, regardless of the outcome of the current dispute. Accordingly, the Supreme Court erred in denying the plaintiff's motion to dismiss the defendant's counterclaim pursuant to CPLR 3211 (a)(1).
Stipulation Void as Against Public Policy, since it Expressly Required the Former Wife to Seek Dissolution of the Marriage and "Provided for the Procurement of Grounds of Divorce
In Charap v Willett, --- N.Y.S.2d ----, 2011 WL 1902605 (N.Y.A.D. 2 Dept.), the parties were divorced by judgment dated March 30, 2009. In a related appeal the Appellate Diviison affirmed the judgment of divorce insofar as appealed from. The former wife initially contested the divorce action commenced in 2003. After a nonjury trial, the Supreme Court determined that the former husband failed to prove his alleged grounds for divorce. The parties then entered into a custody agreement and the former wife filed an amended answer dated May 7, 2007, containing a counterclaim for a divorce on the ground of cruel and inhuman treatment. The former husband waived his reply and, while neither admitting nor denying the allegations, consented to the former wife obtaining a divorce on that ground. A nonjury trial was held on the financial issues, and a judgment of divorce was issued on March 30, 2009. By order to show cause dated July 29, 2009, the former wife moved, inter alia, to direct the former husband to comply with a theretofore confidential stipulation between the parties dated May 7, 2007, and to pay back maintenance and child support in the sum of $13,587.61, plus interest. The stipulation was subscribed by the parties and notarized, but, in accordance with its provisions, was kept confidential from the court during the trial on financial issues. In the stipulation, the former husband agreed, inter alia, to pay the former wife $65,000 over and above a future equitable distribution award, and to pay her counsel $10,000. In exchange, the former wife agreed to promptly prepare an amended answer and counterclaim for a divorce alleging cruel and inhuman treatment. As soon as the court placed the matter on its calendar, the parties would proceed to inquest whereby the grounds for a divorce would be finally and irrevocably determined. The Supreme Court denied the former wife's motion, finding the stipulation unenforceable and her claim of entitlement to back maintenance and child support without merit. The Appellate Divison affirmed. It held that the May 7, 2007, stipulation was void as against public policy, since it expressly required the former wife to seek dissolution of the marriage and "provides for the procurement of grounds of divorce" (General Obligations Law 5-311). As the offending provision represented the only consideration provided by the former wife for the agreement, which did not contain a severability provision, the stipulation was void in its entirety (cf. Taft v. Taft, 156 A.D.2d 444).
Supreme Court providently imputed $200,000 per year in income to the former wife, an attorney, for child support purposes.
In Charap v Willett, --- N.Y.S.2d ----, 2011 WL 1902606 (N.Y.A.D. 2 Dept.) the parties were married in 1982. There were two children of the marriage, born in 1990 and 1995, respectively. The former husband left the marital residence in December 2002 and commenced this action for a divorce on March 17, 2003. After a nonjury trial on grounds for divorce, the Supreme Court determined that the former husband failed to prove his alleged grounds for divorce. On May 7, 2007, the parties entered into a "Stipulation as to Custody, Decision-Making and Parental Access," and the former wife filed an amended answer containing a counterclaim for divorce on the ground of cruel and inhuman treatment. The former husband waived his reply and, while neither admitting or denying the allegations, consented to the former wife obtaining a divorce on that ground. After an inquest, the divorce was granted, but entry of the divorce judgment was held in abeyance pending the resolution of ancillary issues. The matter was transferred for trial on the remaining financial issues. After a nonjury trial, the Supreme Court, inter alia, distributed the marital estate and directed the former husband to pay the former wife durational maintenance in the sum of $5,000 per month for two years. The court also imputed income to the former wife for child support purposes, pro-rated the parties' obligations, and directed the former husband to pay the former wife $3,859.34 per month in child support, plus direct payments of the children's college expenses and other add-ons. The Appellate Divison affirmed. It held that Supreme Court properly rejected the former wife's request for lifetime maintenance. First, a purported agreement dated March 19, 2001, which provided, inter alia, that the former wife would not be required to work outside the family home during a divorce, was ambiguous as to duration and, in any event, was not enforceable (see Domestic Relations Law 236[B][3] ). Moreover, the former wife was an attorney who practiced law for almost 20 years and was capable of earning a significant salary. Given her skills, experience, and the children's mature ages, the Supreme Court appropriately limited maintenance to $5,000 per month for a period of two years. It also held that Supreme Court providently imputed $200,000 per year in income to the former wife for child support purposes. Child support is determined by the parents' ability to provide for their child rather than their current economic situation. In determining a party's child support obligation, the court 'need not rely upon the party's own account of his or her finances, but may impute income based upon the party's past income or demonstrated earning potential. Courts are afforded considerable discretion in determining whether to impute income to a parent. Here, given the former wife's education, experience, and salary history, the imputed sum was supported by the record. Further, the court properly considered the statutory factors in capping the combined parental income at $300,000 for child support purposes, and there was no basis in this record for disturbing its determination. It held that Supreme Court providently awarded the former wife only 10% of the value of the former husband's law practice. The former wife made only indirect contributions to the former husband's career and was herself employed as an attorney for most of the marriage. The Supreme Court providently exercised its discretion in denying the former wife's application for counsel fees, as she received a large distributive award and had a substantial earning capacity.
Sunday, May 29, 2011
Revised RJI (Request for Judicial Intervention) Form
The Unified Court System has promulgated a revised Request for Judicial Intervention Form (Form USC-840 Rev. 3/2011), and Addenda, for use in civil practice in the Supreme and County Courts. The revisions contained in the new form are the product of extensive research and development by court personnel, as well as commentary from the professional bar.
The new forms include the RJI itself (UCS-840), a general addendum (UCS-840A), and specialized addenda for Commercial Division (UCS-840C), foreclosure (UCS-840F), and matrimonial matters (UCS-840M).
Parties and counsel should employ these new forms immediately and henceforth. However, to avoid unfairness in its introduction, courts and clerks should accept both the new and the former RJI form (Rev. 1/2000) for filing through August 31, 2011.
Downloaded from http://www.nycourts.gov/forms/rji/index.shtml (Last accessed May 26, 2011)
The new forms include the RJI itself (UCS-840), a general addendum (UCS-840A), and specialized addenda for Commercial Division (UCS-840C), foreclosure (UCS-840F), and matrimonial matters (UCS-840M).
Parties and counsel should employ these new forms immediately and henceforth. However, to avoid unfairness in its introduction, courts and clerks should accept both the new and the former RJI form (Rev. 1/2000) for filing through August 31, 2011.
Downloaded from http://www.nycourts.gov/forms/rji/index.shtml (Last accessed May 26, 2011)
Thursday, May 26, 2011
New York Attorney Advertising Rule 7.1 Amended
Amendments to Rule 7.1 (c), (d), (e) and (g) of Part 1200 of Title 22 of the Official Compilation of Codes, Rules and Regulations of the State of New York, entitled “Rules of Professional Conduct, were approved by the four presiding justices of the Appellate Division departments. The amendments allow the use of testimonials or endorsements from clients with respect to a pending matter, as long as the clients give informed consent. They allow actors to portray judges, lawyers or clients provided the advertisements disclose that the characters are actors. The rule prohibiting a pop-up or pop-under advertisement in connection with computer-accessed communications has been eliminated.
Former Rule 7.1 (c), (d) (e) and (g) of Part 1200 of Title 22 of the Official Compilation of Codes, Rules and Regulations of the State of New York, entitled “Rules of Professional Conduct, is set forth below, with the deleted sections highlighted:
(c) An advertisement shall not:
(1) include an endorsement of, or testimonial about, a lawyer or law firm from a client with respect to a matter still pending; [DELETED]
(2) include a paid endorsement of, or testimonial about, a lawyer or law firm without disclosing that the person is being compensated therefor;
(3) include the portrayal of a judge, the portrayal of a fictitious law firm, the use of a fictitious name to refer to lawyers not associated together in a law firm, or otherwise imply that lawyers are associated in a law firm if that is not the case; [DELETED]
(4) use actors to portray the lawyer, members of the law firm, or clients, or utilize depictions of fictionalized events or scenes, without disclosure of same;
(5) rely on techniques to obtain attention that demonstrate a clear and intentional lack of relevance to the selection of counsel, including the portrayal of lawyers exhibiting characteristics clearly unrelated to legal competence; [DELETED]
(6) be made to resemble legal documents; or
(7) utilize a nickname, moniker, motto or trade name that implies an ability to obtain results in a matter. [DELETED]
(d) An advertisement that complies with paragraph (e) may contain the following:
(1) statements that are reasonably likely to create an expectation about results the lawyer can achieve;
(2) statements that compare the lawyer's services with the services of other lawyers;
(3) testimonials or endorsements of clients, where not prohibited by paragraph (c)(1), and of former clients; or [DELETED “where not prohibited by paragraph (c)(1)”]
(4) statements describing or characterizing the quality of the lawyer's or law firm's services.
(e) It is permissible to provide the information set forth in paragraph (d) provided:
[DELETED “subdivision (d) of this section” and replaced it with “in paragraph (d)”
(1) its dissemination does not violate paragraph (a); [DELETED “paragraph (a) and replaced it with “subdivision (a) of this section’]
(2) it can be factually supported by the lawyer or law firm as of the date on which the advertisement is published or disseminated; and
(3) it is accompanied by the following disclaimer: "Prior results do not guarantee a similar outcome."
(g) A lawyer or law firm shall not utilize:
(1) a pop-up or pop-under advertisement in connection with computer-accessed communications, other than on the lawyer or law firm's own web site or other internet presence; or [DELETED]
(2) meta tags or other hidden computer codes that, if displayed, would violate these Rules.
Rule 7.1 of Part 1200 of Title 22 of the Official Compilation of Codes, Rules and Regulations of the State of New York, entitled “Rules of Professional Conduct, now provides:
Rule 7.1: Advertising.
(a) A lawyer or law firm shall not use or disseminate or participate in the use
or dissemination of any advertisement that:
(1) contains statements or claims that are false, deceptive or misleading;
or
(2) violates a Rule.
(b) Subject to the provisions of paragraph (a), an advertisement may include
information as to:
(1) legal and nonlegal education, degrees and other scholastic distinctions,
dates of admission to any bar; areas of the law in which the lawyer or law
firm practices, as authorized by these Rules; public offices and teaching
positions held; publications of law related matters authored by the lawyer;
memberships in bar associations or other professional societies or
organizations, including offices and committee assignments therein; foreign
language fluency; and bona fide professional ratings;
(2) names of clients regularly represented, provided that the client has
given prior written consent;
(3) bank references; credit arrangements accepted; prepaid or group legal
services programs in which the lawyer or law firm participates; nonlegal
services provided by the lawyer or law firm or by an entity owned and
controlled by the lawyer or law firm; the existence of contractual
relationships between the lawyer or law firm and a nonlegal professional or
nonlegal professional service firm, to the extent permitted by Rule 5.8, and
the nature and extent of services available through those contractual
relationships; and
(4) legal fees for initial consultation; contingent fee rates in civil
matters when accompanied by a statement disclosing the information required
by paragraph (p); range of fees for legal and nonlegal services, provided
that there be available to the public free of charge a written statement
clearly describing the scope of each advertised service; hourly rates; and
fixed fees for specified legal and nonlegal services.
(c) An advertise shall not:
(1) include a paid endorsement of, or testimonial about, a lawyer or law
firm without disclosing that the person is being compensated therefore;
(2) include the portrayal of a fictitious law firm, the use of a fictitious
name to refer to lawyers not associated together in a law firm, or otherwise
imply that lawyers are associated in a law firm if that is not the case.
(3) use actors to portray a judge, the lawyer, members of the law firm, or
clients, or utilize depictions of fictionalized events or scenes, without
disclosure of same; or
(4) be made to resemble legal documents
(d) An advertisement that complies with subdivision (e) of this section may
contain the following:
(1) statements that are reasonably likely to create an expectation about
results the lawyer can achieve;
(2) statements that compare the lawyer's services with the services of other
lawyers;
(3) testimonials or endorsements of clients, and of former clients; or
(4) statements describing or characterizing the quality of the lawyer's or
law firm's services.
(e) It is permissible to provide the information set forth in subdivision (d)
of this section provided:
(1) its dissemination does not violate subdivision (a) of this section;
(2) it can be factually supported by the lawyer or law firm as of the date
on which the advertisement is published or disseminated;
(3) it is accompanied by the following disclaimer: "Prior results do not
guarantee a similar outcome"; and
(4) in the case of a testimonial or endorsement from a client with respect
to a matter still pending, the client gives informed consent confirmed in
writing.
(f) Every advertisement other than those appearing in a radio, television or
billboard advertisement, in a directory, newspaper, magazine or other
periodical (and any web sites related thereto), or made in person pursuant to
Rule 7.3(a)(1), shall be labeled "Attorney Advertising" on the first page, or
on the home page in the case of a web site. If the communication is in the form
of a self-mailing brochure or postcard, the words "Attorney Advertising" shall
appear therein. In the case of electronic mail, the subject line shall contain
the notation "ATTORNEY ADVERTISING."
(g) A lawyer or law firm shall not utilize meta tags or other hidden computer
codes that, if displayed, would violate these Rules.
(h) All advertisements shall include the name, principal law office address and
telephone number of the lawyer or law firm whose services are being offered.
(i) Any words or statements required by this Rule to appear in an
advertisement must be clearly legible and capable of being read by the
average person, if written, and intelligible if spoken aloud. In the case of
a web site, the required words or statements shall appear on the home page.
(j) A lawyer or law firm advertising any fixed fee for specified legal
services shall, at the time of fee publication, have available to the public
a written statement clearly describing the scope of each advertised service,
which statement shall be available to the client at the time of retainer for
any such service. Such legal services shall include all those services that
are recognized as reasonable and necessary under local custom in the area of
practice in the community where the services are performed.
(k) All advertisements shall be pre-approved by the lawyer or law firm, and
a copy shall be retained for a period of not less than three years following
its initial dissemination. Any advertisement contained in a
computer-accessed communication shall be retained for a period of not less
than one year. A copy of the contents of any web site covered by this Rule
shall be preserved upon the initial publication of the web site, any major
web site redesign, or a meaningful and extensive content change, but in no
event less frequently than once every 90 days.
(l) If a lawyer or law firm advertises a range of fees or an hourly rate for
services, the lawyer or law firm shall not charge more than the fee
advertised for such services. If a lawyer or law firm advertises a fixed fee
for specified legal services, or performs services described in a fee
schedule, the lawyer or law firm shall not charge more than the fixed fee
for such stated legal service as set forth in the advertisement or fee
schedule, unless the client agrees in writing that the services performed or
to be performed were not legal services referred to or implied in the
advertisement or in the fee schedule and, further, that a different fee
arrangement shall apply to the transaction.
(m) Unless otherwise specified in the advertisement, if a lawyer publishes
any fee information authorized under this Rule in a publication that is
published more frequently than once per month, the lawyer shall be bound by
any representation made therein for a period of not less than 30 days after
such publication. If a lawyer publishes any fee information authorized under
this Rule in a publication that is published once per month or less
frequently, the lawyer shall be bound by any representation made therein
until the publication of the succeeding issue. If a lawyer publishes any fee
information authorized under this Rule in a publication that has no fixed
date for publication of a succeeding issue, the lawyer shall be bound by any
representation made therein for a reasonable period of time after
publication, but in no event less than 90 days.
(n) Unless otherwise specified, if a lawyer broadcasts any fee information
authorized under this Rule, the lawyer shall be bound by any representation
made therein for a period of not less than 30 days after such broadcast.
(o) A lawyer shall not compensate or give any thing of value to
representatives of the press, radio, television or other communication
medium in anticipation of or in return for professional publicity in a news
item.
(p) All advertisements that contain information about the fees charged by
the lawyer or law firm, including those indicating that in the absence of a
recovery no fee will be charged, shall comply with the provisions of
Judiciary Law s 488(3).
(q) A lawyer may accept employment that results from participation in
activities designed to educate the public to recognize legal problems, to
make intelligent selection of counsel or to utilize available legal
services.
(r) Without affecting the right to accept employment, a lawyer may speak
publicly or write for publication on legal topics so long as the lawyer does
not undertake to give individual advice.
Current through amendments included in the New York State Register, Volume XXXII,
Issue 21, dated May 25, 2011.
Former Rule 7.1 (c), (d) (e) and (g) of Part 1200 of Title 22 of the Official Compilation of Codes, Rules and Regulations of the State of New York, entitled “Rules of Professional Conduct, is set forth below, with the deleted sections highlighted:
(c) An advertisement shall not:
(1) include an endorsement of, or testimonial about, a lawyer or law firm from a client with respect to a matter still pending; [DELETED]
(2) include a paid endorsement of, or testimonial about, a lawyer or law firm without disclosing that the person is being compensated therefor;
(3) include the portrayal of a judge, the portrayal of a fictitious law firm, the use of a fictitious name to refer to lawyers not associated together in a law firm, or otherwise imply that lawyers are associated in a law firm if that is not the case; [DELETED]
(4) use actors to portray the lawyer, members of the law firm, or clients, or utilize depictions of fictionalized events or scenes, without disclosure of same;
(5) rely on techniques to obtain attention that demonstrate a clear and intentional lack of relevance to the selection of counsel, including the portrayal of lawyers exhibiting characteristics clearly unrelated to legal competence; [DELETED]
(6) be made to resemble legal documents; or
(7) utilize a nickname, moniker, motto or trade name that implies an ability to obtain results in a matter. [DELETED]
(d) An advertisement that complies with paragraph (e) may contain the following:
(1) statements that are reasonably likely to create an expectation about results the lawyer can achieve;
(2) statements that compare the lawyer's services with the services of other lawyers;
(3) testimonials or endorsements of clients, where not prohibited by paragraph (c)(1), and of former clients; or [DELETED “where not prohibited by paragraph (c)(1)”]
(4) statements describing or characterizing the quality of the lawyer's or law firm's services.
(e) It is permissible to provide the information set forth in paragraph (d) provided:
[DELETED “subdivision (d) of this section” and replaced it with “in paragraph (d)”
(1) its dissemination does not violate paragraph (a); [DELETED “paragraph (a) and replaced it with “subdivision (a) of this section’]
(2) it can be factually supported by the lawyer or law firm as of the date on which the advertisement is published or disseminated; and
(3) it is accompanied by the following disclaimer: "Prior results do not guarantee a similar outcome."
(g) A lawyer or law firm shall not utilize:
(1) a pop-up or pop-under advertisement in connection with computer-accessed communications, other than on the lawyer or law firm's own web site or other internet presence; or [DELETED]
(2) meta tags or other hidden computer codes that, if displayed, would violate these Rules.
Rule 7.1 of Part 1200 of Title 22 of the Official Compilation of Codes, Rules and Regulations of the State of New York, entitled “Rules of Professional Conduct, now provides:
Rule 7.1: Advertising.
(a) A lawyer or law firm shall not use or disseminate or participate in the use
or dissemination of any advertisement that:
(1) contains statements or claims that are false, deceptive or misleading;
or
(2) violates a Rule.
(b) Subject to the provisions of paragraph (a), an advertisement may include
information as to:
(1) legal and nonlegal education, degrees and other scholastic distinctions,
dates of admission to any bar; areas of the law in which the lawyer or law
firm practices, as authorized by these Rules; public offices and teaching
positions held; publications of law related matters authored by the lawyer;
memberships in bar associations or other professional societies or
organizations, including offices and committee assignments therein; foreign
language fluency; and bona fide professional ratings;
(2) names of clients regularly represented, provided that the client has
given prior written consent;
(3) bank references; credit arrangements accepted; prepaid or group legal
services programs in which the lawyer or law firm participates; nonlegal
services provided by the lawyer or law firm or by an entity owned and
controlled by the lawyer or law firm; the existence of contractual
relationships between the lawyer or law firm and a nonlegal professional or
nonlegal professional service firm, to the extent permitted by Rule 5.8, and
the nature and extent of services available through those contractual
relationships; and
(4) legal fees for initial consultation; contingent fee rates in civil
matters when accompanied by a statement disclosing the information required
by paragraph (p); range of fees for legal and nonlegal services, provided
that there be available to the public free of charge a written statement
clearly describing the scope of each advertised service; hourly rates; and
fixed fees for specified legal and nonlegal services.
(c) An advertise shall not:
(1) include a paid endorsement of, or testimonial about, a lawyer or law
firm without disclosing that the person is being compensated therefore;
(2) include the portrayal of a fictitious law firm, the use of a fictitious
name to refer to lawyers not associated together in a law firm, or otherwise
imply that lawyers are associated in a law firm if that is not the case.
(3) use actors to portray a judge, the lawyer, members of the law firm, or
clients, or utilize depictions of fictionalized events or scenes, without
disclosure of same; or
(4) be made to resemble legal documents
(d) An advertisement that complies with subdivision (e) of this section may
contain the following:
(1) statements that are reasonably likely to create an expectation about
results the lawyer can achieve;
(2) statements that compare the lawyer's services with the services of other
lawyers;
(3) testimonials or endorsements of clients, and of former clients; or
(4) statements describing or characterizing the quality of the lawyer's or
law firm's services.
(e) It is permissible to provide the information set forth in subdivision (d)
of this section provided:
(1) its dissemination does not violate subdivision (a) of this section;
(2) it can be factually supported by the lawyer or law firm as of the date
on which the advertisement is published or disseminated;
(3) it is accompanied by the following disclaimer: "Prior results do not
guarantee a similar outcome"; and
(4) in the case of a testimonial or endorsement from a client with respect
to a matter still pending, the client gives informed consent confirmed in
writing.
(f) Every advertisement other than those appearing in a radio, television or
billboard advertisement, in a directory, newspaper, magazine or other
periodical (and any web sites related thereto), or made in person pursuant to
Rule 7.3(a)(1), shall be labeled "Attorney Advertising" on the first page, or
on the home page in the case of a web site. If the communication is in the form
of a self-mailing brochure or postcard, the words "Attorney Advertising" shall
appear therein. In the case of electronic mail, the subject line shall contain
the notation "ATTORNEY ADVERTISING."
(g) A lawyer or law firm shall not utilize meta tags or other hidden computer
codes that, if displayed, would violate these Rules.
(h) All advertisements shall include the name, principal law office address and
telephone number of the lawyer or law firm whose services are being offered.
(i) Any words or statements required by this Rule to appear in an
advertisement must be clearly legible and capable of being read by the
average person, if written, and intelligible if spoken aloud. In the case of
a web site, the required words or statements shall appear on the home page.
(j) A lawyer or law firm advertising any fixed fee for specified legal
services shall, at the time of fee publication, have available to the public
a written statement clearly describing the scope of each advertised service,
which statement shall be available to the client at the time of retainer for
any such service. Such legal services shall include all those services that
are recognized as reasonable and necessary under local custom in the area of
practice in the community where the services are performed.
(k) All advertisements shall be pre-approved by the lawyer or law firm, and
a copy shall be retained for a period of not less than three years following
its initial dissemination. Any advertisement contained in a
computer-accessed communication shall be retained for a period of not less
than one year. A copy of the contents of any web site covered by this Rule
shall be preserved upon the initial publication of the web site, any major
web site redesign, or a meaningful and extensive content change, but in no
event less frequently than once every 90 days.
(l) If a lawyer or law firm advertises a range of fees or an hourly rate for
services, the lawyer or law firm shall not charge more than the fee
advertised for such services. If a lawyer or law firm advertises a fixed fee
for specified legal services, or performs services described in a fee
schedule, the lawyer or law firm shall not charge more than the fixed fee
for such stated legal service as set forth in the advertisement or fee
schedule, unless the client agrees in writing that the services performed or
to be performed were not legal services referred to or implied in the
advertisement or in the fee schedule and, further, that a different fee
arrangement shall apply to the transaction.
(m) Unless otherwise specified in the advertisement, if a lawyer publishes
any fee information authorized under this Rule in a publication that is
published more frequently than once per month, the lawyer shall be bound by
any representation made therein for a period of not less than 30 days after
such publication. If a lawyer publishes any fee information authorized under
this Rule in a publication that is published once per month or less
frequently, the lawyer shall be bound by any representation made therein
until the publication of the succeeding issue. If a lawyer publishes any fee
information authorized under this Rule in a publication that has no fixed
date for publication of a succeeding issue, the lawyer shall be bound by any
representation made therein for a reasonable period of time after
publication, but in no event less than 90 days.
(n) Unless otherwise specified, if a lawyer broadcasts any fee information
authorized under this Rule, the lawyer shall be bound by any representation
made therein for a period of not less than 30 days after such broadcast.
(o) A lawyer shall not compensate or give any thing of value to
representatives of the press, radio, television or other communication
medium in anticipation of or in return for professional publicity in a news
item.
(p) All advertisements that contain information about the fees charged by
the lawyer or law firm, including those indicating that in the absence of a
recovery no fee will be charged, shall comply with the provisions of
Judiciary Law s 488(3).
(q) A lawyer may accept employment that results from participation in
activities designed to educate the public to recognize legal problems, to
make intelligent selection of counsel or to utilize available legal
services.
(r) Without affecting the right to accept employment, a lawyer may speak
publicly or write for publication on legal topics so long as the lawyer does
not undertake to give individual advice.
Current through amendments included in the New York State Register, Volume XXXII,
Issue 21, dated May 25, 2011.
Monday, May 23, 2011
Important New Decisions - May 23, 2011
Improper to Incorporate Agreement into Judgment Where No Meeting of The Minds
In Alton v Alton, --- N.Y.S.2d ----, 2011 WL 1612577 (N.Y.A.D. 2 Dept.) the Appellate Division pointed out that the defendant husband contended that the Supreme Court erred in denying his motion which were to set aside the provisions of the parties' oral, on-the-record stipulation of settlement relating to equitable distribution, maintenance, his obligation to purchase an apartment for the plaintiff wife, and the validity of the parties' prenuptial agreement, because there was no meeting of the minds on an essential material term, to wit, the purchase price of the subject apartment. It held that since a judgment was entered that purported to incorporate the terms of the putative settlement, the defendant was precluded from challenging the validity or enforceability of the settlement by way of motion, but was required either to appeal from the judgment or commence a plenary action. Since the defendant appealed from the judgment, it reached the merits of the defendant's contention that no stipulation of settlement was, in fact, consummated. It noted that in determining whether an agreement exists, the inquiry centers upon the parties' intent to be bound and whether there was a meeting of the minds regarding the material terms of the transaction . A review of the transcribed proceedings at which the parties attempted to negotiate a settlement revealed that the parties never reached an agreement on the essential and material term regarding the purchase price of the apartment. The provisions relating to the apartment purchase were intertwined and integrated with the other provisions of the disputed stipulation of settlement, i.e., the provisions relating to equitable distribution, maintenance, and the validity of the parties' prenuptial agreement. Accordingly, the Supreme Court should not have incorporated the disputed stipulation of settlement provisions into the judgment of divorce.
Best Interest of Child Outweighed Application of Exclusionary Rule in Custody Case
In Matter of Young v Young, --- N.Y.S.2d ----, 2010 WL 6622106 (N.Y.A.D. 2 Dept.) the Appellate Division affirmed an order which awarded the father sole custody of the parties child. It held that Family Court did not err in summarily denying the mother's motion to suppress certain evidence which she alleged was obtained illegally. In a custody case, the court is required to determine "solely what is for the best interest of the child, and what will promote its welfare and happiness, and make an award accordingly. It stated that the best interests of the child are determined by a review of the totality of the circumstances. It held that the application of the exclusionary rule to prevent the court from considering factors relevant to that determination, pertaining here to the condition of the home of a parent who was seeking custody, would have a "detrimental impact upon the fact-finding process and the State's enormous interest in protecting the welfare of children," which outweighed the deterrent effect of applying the exclusionary rule (citing Matter of Diane P., 110 A.D.2d 354, 354). It also rejected the mother's contention that the Family Court should have conducted a pretrial hearing as to the voluntariness of an admission she made and the effectiveness of her counsel in a neglect proceeding which had been brought against her. The mother testified as to these matters during the custody trial, such that the issues and her position thereon were before the Family Court. Family Court's determination that it was in the children's best interest for the father to be awarded custody had a sound and substantial basis in the record.
Well-established Precedent Overwhelmingly Supports a Party's Right to an Evidentiary Hearing Before a Finding of Contempt
In Bergman v Bergman, --- N.Y.S.2d ----, 2011 WL 1796364 (N.Y.A.D. 1 Dept.) the Appellate Division held that a hearing is required on a contempt motion when the party opposing the motion asserts a defense of financial inability to comply. Domestic Relations Law s 246(3) in pertinent part states: "Any person may assert his financial inability to comply with ... an order or judgment ... as a defense in a proceeding instituted against him ... to punish him for his failure to comply ... and if the court, upon the hearing of such contempt proceeding is satisfied from the proofs and evidence offered ... that the defendant is financially unable to comply ... it may, in its discretion, until further order of the court, make an order modifying such order or judgment...." Further, Domestic Relations Law 236(B)(9)(b) provides that a party may seek downward modification if he or she has experienced a "substantial change in circumstances:" There is no limit to the number of times a party may seek downward modification. The party must demonstrate that there has been a substantial change in circumstances to merit any downward modification. There is no right to a hearing absent a prima facie showing of entitlement to downward modification. However, well-established precedent overwhelmingly supports a party's right to an evidentiary hearing before a finding of contempt (Boritzer v. Boritzer, 137 A.D.2d 477 [1988]; Comerford v. Comerford, 49 A.D.2d 818 [1975]; Singer v. Singer, 52 A.D.2d 774 [1976]; see also Gifford v. Gifford, 223 A.D.2d 669 [1996] ). In Singer, this Court held that "[d]ue process requires that a hearing be held before one can be adjudged in contempt" , undoubtably because a finding of contempt may result in incarceration as, indeed, it did in this case. Here, defendant has not had any opportunity to offer "proofs [or] evidence" at a hearing on either plaintiff's contempt motion or defendant's cross motion for downward modification. The court entirely ignored the affidavits prepared by a reputable forensic accountant, and the voluminous documentation defendant presented. In the court's opinion, defendant had had "repeated days in court." However, on this motion, defendant clearly presented new financial information and an expert affidavit explaining that defendant's circumstances had changed, and not for the better. Accordingly, it held that defendant should have had a hearing to assess the new financial information and new expert affidavit.
Lifetime Maintenance Award of $200 per Week to Be Warranted Given the Identified Disparity in the Parties' Respective Incomes and the Wife's Reduced Earning Potential.
In Scarpace v Scarpace, --- N.Y.S.2d ----, 2011 WL 1797230 (N.Y.A.D. 3 Dept.) after 31 years of marriage, plaintiff (husband) commenced an action for divorce. The parties entered into a stipulation with respect to all issues with the exception of spousal maintenance. According to their stipulation, the marital property was divided such that each party would retain various liquid assets valued at approximately $580,000. The wife's share included the unencumbered former marital residence, appraised at $250,000, and a payment received from the husband in the amount of $110,000. The parties also stipulated, that they each retain their own pension rights as separate property. After a trial, Supreme Court awarded the wife maintenance in the amount of $200 per week for six years, effective May 22, 2009. On appeal the wife contended that Supreme Court erred in setting the amount of maintenance at $200 per week and in limiting its duration to six years. The wife argued that the maintenance award would impair her ability to save money and, because she would reach her intended retirement age when the maintenance award terminates, she will be forced to rely on her savings to maintain her standard of living. The Appellate Division modified the underlying judgment to he extent that the wife was to receive lifetime maintenance in the amount of $200 per week, retroactive to October 16, 2007, the date of her answer. The Appellate Division observed that "Maintenance is appropriate where, among other things, the marriage is of long duration, the recipient spouse has been out of the work force for a number of years, has sacrificed her or his own career development or has made substantial noneconomic contributions to the household or to the career of the payor". At the time of trial, both parties were in their mid-fifties and in generally good health. Throughout their marriage, they lived a financially conservative lifestyle, resulting in no college loans for their four emancipated children and no mortgage on the marital home. While the husband attended college and built his career, the wife worked various part-time and seasonal jobs and devoted her time to tending to the needs of their children. As a result, the wife did not commence her current full-time occupation with State Farm Insurance until approximately 1996, such that at the time of trial, her annual income was roughly $32,000. The husband was earning $104,000 per year as a 32-year employee of the Department of Taxation and Finance. While the husband estimated that he would receive over $5,000 per month from his pension alone upon retirement, the wife estimated that between Social Security retirement and her own pension, she would receive approximately $1,200 per month upon her retirement. The wife also testified that she was now required to pay for health and homeowner's insurance, school and property taxes and various utilities and household expenses, all of which previously had been paid for by the husband. Finally, the wife testified that, while she used to save $600 per month, since the divorce she can only afford to save $275 per month, and that she has accumulated $8,600 in credit card debt due to their son's college expenses. The Appellate Division was persuaded that an award of lifetime maintenance was appropriate here. While it was true that the parties enjoyed a modest standard of living during their marriage and that the wife not only can contribute toward her own support but also has received assets through equitable distribution, one of "the many specific considerations underlying an award of nondurational maintenance ... is the present and potential future income of the parties". Given the identified disparity in the parties' respective incomes and the wife's reduced earning potential, it found a nondurational maintenance award of $200 per week to be warranted.
Finding That MBA Made the Defendant a More Attractive Candidate for Position in the Financial Sector of the Cable Television Industry Enhanced His Earning Capacity and Was a Marital Asset.
In Huffman v Huffman, --- N.Y.S.2d ----, 2011 WL 1817309 (N.Y.A.D. 2 Dept.) Supreme Court awarded the plaintiff 30% of the value of defendants master's degree, weekly child support of $1,281.14, and maintenance for four years commencing December 1, 2008, in the amounts of $5,000 per month for the first and second years, $3,500 per month for the third year, and $2,000 per month for the fourth year, and directed him to pay to the plaintiff $90,793.02 in connection with certain bonus money. The Appellate Divison held that Supreme Court's determination of basic child support was proper. The Supreme Court providently exercised its discretion in calculating child support against $300,000 of the defendant's income based upon the standard of living that the parties' children would have enjoyed had the marriage not dissolved and upon the parties' disparate financial circumstances, which were apparent from the record. Under the circumstances of this case, the Supreme Court improvidently exercised its discretion in awarding the plaintiff maintenance for four years beginning December 2008, given the length of the parties' marriage, the plaintiff's ability to reenter the workforce, and the fact that the defendant was paying temporary support pursuant to a pendente lite order dated February 25, 2005, requiring him to pay the plaintiff $2,500 per month in maintenance retroactive to November 11, 2004. Thus, the maintenance award had to be recalculated retroactive to November 11, 2004, taking into account any credit due for amounts paid by the defendant pursuant to the pendente lite order. The Appellate Division disagreed with defendants contention that the trial court erred in concluding that his MBA degree provided him with an enhanced earning capacity subject to equitable distribution. An academic degree earned during a marriage qualifies as marital property which is subject to equitable distribution ( McGowan v. McGowan, 142 A.D.2d 355, 357). The value of a degree is the "enhanced earning capacity it affords the holder" (O'Brien v. O'Brien, 66 N.Y.2d 576, 588). Here, while the defendant presented some evidence that an MBA degree was not an actual prerequisite to his employment in various finance positions in the cable television industry, there was also ample evidence, including expert testimony, to support the Supreme Court's finding that the attainment of this degree made the defendant a more attractive candidate for a position in the financial sector of the cable television industry. Accordingly, the Supreme Court properly concluded that the MBA degree which the defendant obtained during the course of his employment enhanced his earning capacity. The Supreme Court also properly determined that the plaintiff was entitled to a 30% share of the defendant's enhanced earning capacity. Although the plaintiff did not make direct financial contributions to the husband's attainment of his MBA degree, she made substantial indirect contributions by, inter alia, supporting the husband's educational endeavors, working until August 2000 and contributing her earnings to the family, being the primary caretaker of the couple's children, cooking family meals, and participating in housekeeping responsibilities. Bonuses earned for work by a spouse during the marriage constitute marital property subject to equitable distribution, even if paid after commencement of the divorce action, and are distributed after taking income taxes into account. It saw no reason to disturb the Supreme Court's equitable distribution of the defendant's 2002 and 2003 bonuses. However, it agreed with the defendant's contention that the Supreme Court erroneously distributed his gross 2004 bonus without taking into account income taxes. Accordingly, upon remittal, to the Supreme Court the award had to be recalculated to the extent it is based upon the defendant's 2004 bonus, to take into account income taxes paid by the plaintiff.
Proper to Apply a Lack of Marketability Discount of 25% to Reflect the Risk Associated with the Illiquidity of a Close Corporation Whose Shares Cannot Be Freely Traded.
In Cooper v Cooper, --- N.Y.S.2d ----, 2011 WL 1817757 (N.Y.A.D. 2 Dept.) the parties were married on April 8, 1984, and had two children, born in 1989, and 1992, respectively. Supreme Court, inter alia, awarded the plaintiff post-divorce maintenance of $5,000 per month for a period of four years, interest of 9% per annum on installment payments of the plaintiff's distributive awards, child support of $1,192.31 per week, based upon a finding that the defendant's "CSSA income is $250,000 per year," directed the defendant to maintain a life insurance policy for the benefit of the plaintiff and the children in the value of $500,000, and awarded her counsel fees of $50,000. This action was commenced in March 2003. The defendant was the founder and owner of Triangle Electronics Group, Inc. ( Triangle), which distributed electronic components. A primary issue at trial and on appeal was the equitable distribution of the defendant's 100% interest in Triangle, which the Supreme Court determined was worth $1,625,000 on the date of commencement of the action. In so doing, the Supreme Court credited the defendant's expert. The Appellate Divison held that the determination of the fact finder as to the value of a business, if within the range of the testimony presented, will be accorded deference on appeal if it rests primarily on the credibility of expert witnesses and their valuation techniques". The testimony of the defendant's expert, which was supported by competent evidence in the record and a written report admitted into evidence, was properly credited by the Supreme Court. The defendant's expert properly applied a lack of marketability discount of 25% to reflect the risk associated with the illiquidity of a close corporation whose shares cannot be freely traded. The Supreme Court properly determined that the plaintiff was responsible for one-half of the federal tax liability of $1,371,744 incurred when the defendant filed amended income tax returns for the tax years 1999, 2000, 2001, 2002, and 2003, but that she was not responsible for New York State tax liability, or any interest and penalties as a result of the filing of the amended tax returns. Since that tax liability was incurred during the marriage, the Supreme Court properly determined that the plaintiff was responsible for part of this liability. The record established that the defendant was responsible for the delay in reporting the income declared on those amended returns and, therefore, was properly required to pay all interest and penalties. Further, under all of the circumstances of this case, including that fact that, with respect to New York State tax liability, the plaintiff was officially adjudicated an innocent spouse, the Supreme Court providently exercised its discretion in determining that the plaintiff was not responsible for any of the New York State tax liability. The Supreme Court properly exercised its discretion in awarding the plaintiff post-divorce maintenance in the sum of $5,000 per month for a period of four years, based upon the parties' standard of living during the marriage, their income, and the plaintiff's distributive awards. The amount of maintenance awarded to the plaintiff would ensure that her reasonable needs were met, while providing her with an incentive to become self-supporting. Further, the award of child support was proper. The award of counsel fees, and the denial of additional expert fees, was a provident exercise of discretion, in light of the interim awards of counsel fees and expert fees, and the Supreme Court's conclusion that the fees demanded by the plaintiff's expert were excessive. Further, the award of interest at the statutory rate of 9% per annum (see CPLR 5004), on the plaintiff's distributive awards, should the defendant elect to pay those awards in installments over a period of five years, was a provident exercise of discretion.
In Alton v Alton, --- N.Y.S.2d ----, 2011 WL 1612577 (N.Y.A.D. 2 Dept.) the Appellate Division pointed out that the defendant husband contended that the Supreme Court erred in denying his motion which were to set aside the provisions of the parties' oral, on-the-record stipulation of settlement relating to equitable distribution, maintenance, his obligation to purchase an apartment for the plaintiff wife, and the validity of the parties' prenuptial agreement, because there was no meeting of the minds on an essential material term, to wit, the purchase price of the subject apartment. It held that since a judgment was entered that purported to incorporate the terms of the putative settlement, the defendant was precluded from challenging the validity or enforceability of the settlement by way of motion, but was required either to appeal from the judgment or commence a plenary action. Since the defendant appealed from the judgment, it reached the merits of the defendant's contention that no stipulation of settlement was, in fact, consummated. It noted that in determining whether an agreement exists, the inquiry centers upon the parties' intent to be bound and whether there was a meeting of the minds regarding the material terms of the transaction . A review of the transcribed proceedings at which the parties attempted to negotiate a settlement revealed that the parties never reached an agreement on the essential and material term regarding the purchase price of the apartment. The provisions relating to the apartment purchase were intertwined and integrated with the other provisions of the disputed stipulation of settlement, i.e., the provisions relating to equitable distribution, maintenance, and the validity of the parties' prenuptial agreement. Accordingly, the Supreme Court should not have incorporated the disputed stipulation of settlement provisions into the judgment of divorce.
Best Interest of Child Outweighed Application of Exclusionary Rule in Custody Case
In Matter of Young v Young, --- N.Y.S.2d ----, 2010 WL 6622106 (N.Y.A.D. 2 Dept.) the Appellate Division affirmed an order which awarded the father sole custody of the parties child. It held that Family Court did not err in summarily denying the mother's motion to suppress certain evidence which she alleged was obtained illegally. In a custody case, the court is required to determine "solely what is for the best interest of the child, and what will promote its welfare and happiness, and make an award accordingly. It stated that the best interests of the child are determined by a review of the totality of the circumstances. It held that the application of the exclusionary rule to prevent the court from considering factors relevant to that determination, pertaining here to the condition of the home of a parent who was seeking custody, would have a "detrimental impact upon the fact-finding process and the State's enormous interest in protecting the welfare of children," which outweighed the deterrent effect of applying the exclusionary rule (citing Matter of Diane P., 110 A.D.2d 354, 354). It also rejected the mother's contention that the Family Court should have conducted a pretrial hearing as to the voluntariness of an admission she made and the effectiveness of her counsel in a neglect proceeding which had been brought against her. The mother testified as to these matters during the custody trial, such that the issues and her position thereon were before the Family Court. Family Court's determination that it was in the children's best interest for the father to be awarded custody had a sound and substantial basis in the record.
Well-established Precedent Overwhelmingly Supports a Party's Right to an Evidentiary Hearing Before a Finding of Contempt
In Bergman v Bergman, --- N.Y.S.2d ----, 2011 WL 1796364 (N.Y.A.D. 1 Dept.) the Appellate Division held that a hearing is required on a contempt motion when the party opposing the motion asserts a defense of financial inability to comply. Domestic Relations Law s 246(3) in pertinent part states: "Any person may assert his financial inability to comply with ... an order or judgment ... as a defense in a proceeding instituted against him ... to punish him for his failure to comply ... and if the court, upon the hearing of such contempt proceeding is satisfied from the proofs and evidence offered ... that the defendant is financially unable to comply ... it may, in its discretion, until further order of the court, make an order modifying such order or judgment...." Further, Domestic Relations Law 236(B)(9)(b) provides that a party may seek downward modification if he or she has experienced a "substantial change in circumstances:" There is no limit to the number of times a party may seek downward modification. The party must demonstrate that there has been a substantial change in circumstances to merit any downward modification. There is no right to a hearing absent a prima facie showing of entitlement to downward modification. However, well-established precedent overwhelmingly supports a party's right to an evidentiary hearing before a finding of contempt (Boritzer v. Boritzer, 137 A.D.2d 477 [1988]; Comerford v. Comerford, 49 A.D.2d 818 [1975]; Singer v. Singer, 52 A.D.2d 774 [1976]; see also Gifford v. Gifford, 223 A.D.2d 669 [1996] ). In Singer, this Court held that "[d]ue process requires that a hearing be held before one can be adjudged in contempt" , undoubtably because a finding of contempt may result in incarceration as, indeed, it did in this case. Here, defendant has not had any opportunity to offer "proofs [or] evidence" at a hearing on either plaintiff's contempt motion or defendant's cross motion for downward modification. The court entirely ignored the affidavits prepared by a reputable forensic accountant, and the voluminous documentation defendant presented. In the court's opinion, defendant had had "repeated days in court." However, on this motion, defendant clearly presented new financial information and an expert affidavit explaining that defendant's circumstances had changed, and not for the better. Accordingly, it held that defendant should have had a hearing to assess the new financial information and new expert affidavit.
Lifetime Maintenance Award of $200 per Week to Be Warranted Given the Identified Disparity in the Parties' Respective Incomes and the Wife's Reduced Earning Potential.
In Scarpace v Scarpace, --- N.Y.S.2d ----, 2011 WL 1797230 (N.Y.A.D. 3 Dept.) after 31 years of marriage, plaintiff (husband) commenced an action for divorce. The parties entered into a stipulation with respect to all issues with the exception of spousal maintenance. According to their stipulation, the marital property was divided such that each party would retain various liquid assets valued at approximately $580,000. The wife's share included the unencumbered former marital residence, appraised at $250,000, and a payment received from the husband in the amount of $110,000. The parties also stipulated, that they each retain their own pension rights as separate property. After a trial, Supreme Court awarded the wife maintenance in the amount of $200 per week for six years, effective May 22, 2009. On appeal the wife contended that Supreme Court erred in setting the amount of maintenance at $200 per week and in limiting its duration to six years. The wife argued that the maintenance award would impair her ability to save money and, because she would reach her intended retirement age when the maintenance award terminates, she will be forced to rely on her savings to maintain her standard of living. The Appellate Division modified the underlying judgment to he extent that the wife was to receive lifetime maintenance in the amount of $200 per week, retroactive to October 16, 2007, the date of her answer. The Appellate Division observed that "Maintenance is appropriate where, among other things, the marriage is of long duration, the recipient spouse has been out of the work force for a number of years, has sacrificed her or his own career development or has made substantial noneconomic contributions to the household or to the career of the payor". At the time of trial, both parties were in their mid-fifties and in generally good health. Throughout their marriage, they lived a financially conservative lifestyle, resulting in no college loans for their four emancipated children and no mortgage on the marital home. While the husband attended college and built his career, the wife worked various part-time and seasonal jobs and devoted her time to tending to the needs of their children. As a result, the wife did not commence her current full-time occupation with State Farm Insurance until approximately 1996, such that at the time of trial, her annual income was roughly $32,000. The husband was earning $104,000 per year as a 32-year employee of the Department of Taxation and Finance. While the husband estimated that he would receive over $5,000 per month from his pension alone upon retirement, the wife estimated that between Social Security retirement and her own pension, she would receive approximately $1,200 per month upon her retirement. The wife also testified that she was now required to pay for health and homeowner's insurance, school and property taxes and various utilities and household expenses, all of which previously had been paid for by the husband. Finally, the wife testified that, while she used to save $600 per month, since the divorce she can only afford to save $275 per month, and that she has accumulated $8,600 in credit card debt due to their son's college expenses. The Appellate Division was persuaded that an award of lifetime maintenance was appropriate here. While it was true that the parties enjoyed a modest standard of living during their marriage and that the wife not only can contribute toward her own support but also has received assets through equitable distribution, one of "the many specific considerations underlying an award of nondurational maintenance ... is the present and potential future income of the parties". Given the identified disparity in the parties' respective incomes and the wife's reduced earning potential, it found a nondurational maintenance award of $200 per week to be warranted.
Finding That MBA Made the Defendant a More Attractive Candidate for Position in the Financial Sector of the Cable Television Industry Enhanced His Earning Capacity and Was a Marital Asset.
In Huffman v Huffman, --- N.Y.S.2d ----, 2011 WL 1817309 (N.Y.A.D. 2 Dept.) Supreme Court awarded the plaintiff 30% of the value of defendants master's degree, weekly child support of $1,281.14, and maintenance for four years commencing December 1, 2008, in the amounts of $5,000 per month for the first and second years, $3,500 per month for the third year, and $2,000 per month for the fourth year, and directed him to pay to the plaintiff $90,793.02 in connection with certain bonus money. The Appellate Divison held that Supreme Court's determination of basic child support was proper. The Supreme Court providently exercised its discretion in calculating child support against $300,000 of the defendant's income based upon the standard of living that the parties' children would have enjoyed had the marriage not dissolved and upon the parties' disparate financial circumstances, which were apparent from the record. Under the circumstances of this case, the Supreme Court improvidently exercised its discretion in awarding the plaintiff maintenance for four years beginning December 2008, given the length of the parties' marriage, the plaintiff's ability to reenter the workforce, and the fact that the defendant was paying temporary support pursuant to a pendente lite order dated February 25, 2005, requiring him to pay the plaintiff $2,500 per month in maintenance retroactive to November 11, 2004. Thus, the maintenance award had to be recalculated retroactive to November 11, 2004, taking into account any credit due for amounts paid by the defendant pursuant to the pendente lite order. The Appellate Division disagreed with defendants contention that the trial court erred in concluding that his MBA degree provided him with an enhanced earning capacity subject to equitable distribution. An academic degree earned during a marriage qualifies as marital property which is subject to equitable distribution ( McGowan v. McGowan, 142 A.D.2d 355, 357). The value of a degree is the "enhanced earning capacity it affords the holder" (O'Brien v. O'Brien, 66 N.Y.2d 576, 588). Here, while the defendant presented some evidence that an MBA degree was not an actual prerequisite to his employment in various finance positions in the cable television industry, there was also ample evidence, including expert testimony, to support the Supreme Court's finding that the attainment of this degree made the defendant a more attractive candidate for a position in the financial sector of the cable television industry. Accordingly, the Supreme Court properly concluded that the MBA degree which the defendant obtained during the course of his employment enhanced his earning capacity. The Supreme Court also properly determined that the plaintiff was entitled to a 30% share of the defendant's enhanced earning capacity. Although the plaintiff did not make direct financial contributions to the husband's attainment of his MBA degree, she made substantial indirect contributions by, inter alia, supporting the husband's educational endeavors, working until August 2000 and contributing her earnings to the family, being the primary caretaker of the couple's children, cooking family meals, and participating in housekeeping responsibilities. Bonuses earned for work by a spouse during the marriage constitute marital property subject to equitable distribution, even if paid after commencement of the divorce action, and are distributed after taking income taxes into account. It saw no reason to disturb the Supreme Court's equitable distribution of the defendant's 2002 and 2003 bonuses. However, it agreed with the defendant's contention that the Supreme Court erroneously distributed his gross 2004 bonus without taking into account income taxes. Accordingly, upon remittal, to the Supreme Court the award had to be recalculated to the extent it is based upon the defendant's 2004 bonus, to take into account income taxes paid by the plaintiff.
Proper to Apply a Lack of Marketability Discount of 25% to Reflect the Risk Associated with the Illiquidity of a Close Corporation Whose Shares Cannot Be Freely Traded.
In Cooper v Cooper, --- N.Y.S.2d ----, 2011 WL 1817757 (N.Y.A.D. 2 Dept.) the parties were married on April 8, 1984, and had two children, born in 1989, and 1992, respectively. Supreme Court, inter alia, awarded the plaintiff post-divorce maintenance of $5,000 per month for a period of four years, interest of 9% per annum on installment payments of the plaintiff's distributive awards, child support of $1,192.31 per week, based upon a finding that the defendant's "CSSA income is $250,000 per year," directed the defendant to maintain a life insurance policy for the benefit of the plaintiff and the children in the value of $500,000, and awarded her counsel fees of $50,000. This action was commenced in March 2003. The defendant was the founder and owner of Triangle Electronics Group, Inc. ( Triangle), which distributed electronic components. A primary issue at trial and on appeal was the equitable distribution of the defendant's 100% interest in Triangle, which the Supreme Court determined was worth $1,625,000 on the date of commencement of the action. In so doing, the Supreme Court credited the defendant's expert. The Appellate Divison held that the determination of the fact finder as to the value of a business, if within the range of the testimony presented, will be accorded deference on appeal if it rests primarily on the credibility of expert witnesses and their valuation techniques". The testimony of the defendant's expert, which was supported by competent evidence in the record and a written report admitted into evidence, was properly credited by the Supreme Court. The defendant's expert properly applied a lack of marketability discount of 25% to reflect the risk associated with the illiquidity of a close corporation whose shares cannot be freely traded. The Supreme Court properly determined that the plaintiff was responsible for one-half of the federal tax liability of $1,371,744 incurred when the defendant filed amended income tax returns for the tax years 1999, 2000, 2001, 2002, and 2003, but that she was not responsible for New York State tax liability, or any interest and penalties as a result of the filing of the amended tax returns. Since that tax liability was incurred during the marriage, the Supreme Court properly determined that the plaintiff was responsible for part of this liability. The record established that the defendant was responsible for the delay in reporting the income declared on those amended returns and, therefore, was properly required to pay all interest and penalties. Further, under all of the circumstances of this case, including that fact that, with respect to New York State tax liability, the plaintiff was officially adjudicated an innocent spouse, the Supreme Court providently exercised its discretion in determining that the plaintiff was not responsible for any of the New York State tax liability. The Supreme Court properly exercised its discretion in awarding the plaintiff post-divorce maintenance in the sum of $5,000 per month for a period of four years, based upon the parties' standard of living during the marriage, their income, and the plaintiff's distributive awards. The amount of maintenance awarded to the plaintiff would ensure that her reasonable needs were met, while providing her with an incentive to become self-supporting. Further, the award of child support was proper. The award of counsel fees, and the denial of additional expert fees, was a provident exercise of discretion, in light of the interim awards of counsel fees and expert fees, and the Supreme Court's conclusion that the fees demanded by the plaintiff's expert were excessive. Further, the award of interest at the statutory rate of 9% per annum (see CPLR 5004), on the plaintiff's distributive awards, should the defendant elect to pay those awards in installments over a period of five years, was a provident exercise of discretion.
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