122 Misc. 2d 552 | N.Y. Sup. Ct. | 1983
OPINION OF THE COURT
In this divorce action brought by a wife against her multimillionaire husband of 40 years, the wife now moves for temporary maintenance and interim counsel, appraiser and accountant fees. The motion raises fundamental questions about pendente lite applications both substantive and evidentiary, pertinent to the rights of rich, as Well as poor, litigants:
(1) Should a court hearing such a motion seek to maintain a rough equality of economic condition prior to judgment to insure that the results of any trial, and any negotiations, are arrived at fairly and not as the result of duress or overreaching?
(2) Should the court presume, absent proof to the contrary, that the financial needs of the parties are the same such that the husband’s evidence as to his reasonable needs can be taken into account in determining the wife’s entitlement to temporary maintenance?
(3) Is it reasonable to expect that a party opposing an interim award for counsel fees, appraiser fees and the like,
For the reasons that follow, this court answers each of these questions in the affirmative.
FACTS
The parties have been married for almost 42 years and are each 60 years old. They have raised four children, none of whom is living at home. Throughout most of the marriage, the plaintiff wife cared for the family while the husband built a very substantial business enterprise. It appears that all the assets of the parties are marital property.
In recent years, the wife has obtained part-time employment as a reading teacher, apparently never earning more than $6,000-$7,000 per year. In 1981 and 1982, the family income as reported on Federal income tax returns was $316,000 and $325,000, respectively. All but $12,000 of this was derived from the husband’s business or assets controlled by the husband. The taxes paid on the 1982 income were approximately $155,000 leaving a net disposable income of approximately $170,000. The husband’s current income is approximately the same as last year’s. The wife has little, if any, income.
With respect to the assets of the parties, the wife claims — and defendant does not deny for purposes of this motion — that the value of defendant’s interest in his business is $10,000,000. Defendant, who did not submit a net worth statement, concedes that his securities portfolio is worth approximately $473,000. He does not contest plaintiff’s statements that he also owns a loan receivable in the amount of $108,000, an interest in a limited partnership for which he paid $75,000, two parcels of real estate in California, one in New Jersey, one in Massachusetts, an interest in a corporate pension plan and an individual retirement account. The wife does not know the value of these holdings and defendant does not disclose same.
In addition to the above, the parties own in joint names the marital residence located in Massapequa, New York
The plaintiff wife holds in her name title to two unimproved lots in Florida purchased 10 years ago for $12,000 and said to be worth considerably more today; also, a vacation home in Deposit, New York, valued at $85,000, which is presently used by both plaintiff and defendant. In addition, the plaintiff has liquid assets of approximately $30,000. Above this, she shows without contradiction that she previously owned a 50% interest in two buildings sold to the husband’s corporation in 1974 for a net of $544,872, which sum was fully paid in installments by July, 1978, but that plaintiff never received any of this money all of which was converted by the defendant.
The husband does not contest on this motion his ability to pay the amounts demanded by plaintiff for temporary maintenance, counsel fees, accountant and appraiser fees. The issues in dispute are the parties’ preseparation standard of living and the wife’s present “needs”. With respect to these, the defendant presently pays to plaintiff $1,350 per month and also pays her medical expenses, carrying charges on the marital home and the vacation home in Deposit. (There is some question whether the defendant incurs any expense for the Florida condominium which he apparently leases to his business.) Defendant hotly contests plaintiff’s claim to carrying charges on the marital home and the Deposit residence plus $3,500 per month maintenance (which figure includes an estimated $1,000 per month for taxes), and challenges her figures for food, vacations, entertainment, house repairs, transportation, etc., all of which add up to the sum of $2,500 per month.
Of interest, there is annexed to plaintiff’s papers a copy of a budget which plaintiff says (and defendant does not deny) defendant prepared to show his 1982 estimated personal expenses. These show expenses of $39,000 per year, or $3,250 per month, in addition to maintenance of the marital home, the Deposit home, and defendant’s residence in New York, taxes, and support of the plaintiff.
DISCUSSION
Temporary Maintenance
The dissolution of a marriage, particularly one of long duration, is one of the most emotionally debilitating exper
Since equality of economic circumstances after the dissolution of the marriage is a probable, albeit not preordained consequence, it is appropriate that the court take this into account in determining “the financial need of the party making the [pendente lite] application.” (Jorgensen v Jorgensen, 86 AD2d 861; cf. Johnson v Johnson, 91 AD2d 951 [1st Dept].) In a closely analogous context, our courts have deemed relevant, in passing upon a wife’s application for temporary support, the probability that the husband will prove at trial that the wife’s misconduct has barred her from any final relief. (Cipriani v Cipriani, 45 Misc 2d 500, cited in Hyman v Hyman, 56 AD2d 337, 338.) By parity of reasoning, the courts should give consideration to the likelihood that the wife will obtain a substantial final judgment.
For similar reasons as are stated above, in determining the amount of the wife’s financial need, there would appear to be no logical reason to exclude consideration of the
For all the foregoing reasons, the court finds that plaintiff’s request for $3,500 per month temporary maintenance (including $1,000 for taxes) is reasonable. (Cf. Berley v Berley, 97 AD2d 726 [$1,250 per week maintenance and child support ordered where husband’s income in excess of $200,000 per year and net worth over $5,000,000]; see, also, Brody v Brody, 98 AD2d 702 [$630 per week temporary maintenance and child support ordered in addition to carrying charges on marital home, medical expenses, insurance expenses and religious school tuition, where husband has disposable income of $300,000 per year].) Defendant shall pay said sum retroactive to August 1, 1983 (see Domestic Relations Law, § 236, part B, subd 6, par a) with a credit for sums actually paid by defendant to plaintiff since that date. Payments shall be made on the first day of each month by check or money order. In addition, the defendant shall continue to pay the mortgage, taxes and electricity and fuel for the marital residence and the house in Deposit, New York. (Domestic Relations Law, § 236, part B, subd 8, par b.)
Counsel Fees
Turning to the issue of interim counsel fees, the papers show that plaintiff paid to her counsel, who is an experienced and well-respected member of the matrimonial Bar,
Although the husband states plaintiff’s estimates of counsel fees are outlandish, it is significant that he has not disclosed his own expenditures to date or the terms of his attorney’s retainer.
Given the number of assets which must be evaluated in this equitable distribution proceeding and the large sums at stake, considerable effort and expertise will be required to properly prepare this case for trial. (See Ahern v Ahern, 94 AD2d 53.) This is particularly so since the husband’s principal asset — his controlling interest in Duro Dyne Corp. — has apparently been converted into preferred shares of stock after the common shares of the corporation were unilaterally transferred by defendant in trust for his children and grandchildren. In such a situation, establishment of the rights of the interested parties to ownership of the common stock, and valuation of any shares found to be owned either legally or equitably by defendant, involve sophisticated and time-consuming preparation before trial and proof at trial.
A wife is not required to deplete her limited capital to pay for counsel fees. (Hyman v Hyman, supra; Lubin v Lubin, 66 AD2d 677 [1st Dept]; cf. Kaplan v Kaplan, 77 AD2d 891 [2d Dept], app dsmd 51 NY2d 822.)
With respect to the reasonable value of temporary attorney’s fees, the husband’s failure to disclose his own arrangements with his attorney leads to the presumption that, if disclosed, such evidence would support plaintiff’s
Consequently, on this record the court would consider the plaintiff’s request for a $35,000 counsel fee through the trial of the action as being reasonable given the amounts at stake, the complexity of the issues presented, the standing of the respective counsel, and the husband’s failure to disclose his own arrangements.
Nevertheless, it is unnecessary at this time to make an award which will carry through the trial of the action. Because further interim relief can be sought if circumstances so require, and because the potential in this case for costly pretrial preparation may not be actualized, an interim award of $15,000 will presently be ordered with plaintiff granted the right to apply before, or during, trial for an additional award. This sum shall be paid by defendant directly to plaintiff’s attorneys within 30 days of service of a copy of this order with notice of entry.
. See, e.g., Brody, Divorce’s Stress Exacts Long-Term Health Toll, New York Times, Dec. 13, 1983, § C, p 1.
. The other side of the coin, of course, is that the spouse (usually the husband) who pays temporary support should be entitled to receive a credit at the time of final judgment to the extent necessary to achieve true equitable distribution. Since temporary support is only awarded where the financial needs of the wife require it (Jorgensen v Jorgensen, 86 AD2d 861), it is unfair to require the husband to pay temporary support because the wife has not received her final award, and yet to deny the husband a credit once the wife no longer has a financial need.
Especially is this so since the moving papers on a pendente lite application are often false and in any event are usually unsupported by sufficient documentation to enable the court to rationally resolve the opposing contentions of the parties. As a practical matter, unless an error in favor of the wife can be corrected in the final judgment, courts will tend to be overly conservative in awarding the wife pendente lite relief. Thus, it is in the interest of both parties that the court rendering a final judgment be able to rectify the inequities, if there be any, occasioned by a temporary award.
Alan Scheinkman (1981 Practice Commentary, McKinney’s Cons Laws of NY, Book 14, 1983-1984 Pocket Part, Domestic Relations Law, C236B:19) suggests the power to award a credit per se is lacking, but that the same result can be achieved in setting the amount of “permanent” support. Notwithstanding, since the “equitable disposition of
. Indeed, the wife in such a case may be entitled to even greater than an equal share of the marital property when all of the statutory criteria are considered. (See Foster, NY Equitable Distribution Divorce Law, p 43.)
. Insofar as the wife also requests that defendant “restore” to her various credit cards, apparently intending by that to mean unlimited use of defendant’s credit, this request is denied. (Troiano v Troiano, 87 AD2d 588.)
. Although the reasons for so holding are not usually articulated, the desirability of maintaining a rough parity during litigation would seem to be paramount.
. Although section 237 of the Domestic Relations Law, as amended by chapter 287 of the Laws of 1983, prohibits modification of a temporary counsel fee award, for the reasons stated above with respect to temporary maintenance the husband should be entitled, where appropriate, to a credit on account of temporary counsel fees against property ordered distributed to the wife in the final judgment.