Donnelly v. Donnelly

963 A.2d 855, 405 N.J. Super. 117
CourtNew Jersey Superior Court Appellate Division
DecidedFebruary 2, 2009
DocketA-2389-07T3
StatusPublished
Cited by71 cases

This text of 963 A.2d 855 (Donnelly v. Donnelly) is published on Counsel Stack Legal Research, covering New Jersey Superior Court Appellate Division primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Donnelly v. Donnelly, 963 A.2d 855, 405 N.J. Super. 117 (N.J. Ct. App. 2009).

Opinion

963 A.2d 855 (2009)
405 N.J. Super. 117

Elizabeth DONNELLY, Plaintiff-Respondent,
v.
Gregory R. DONNELLY, Defendant-Appellant.

Docket No. A-2389-07T3.

Superior Court of New Jersey, Appellate Division.

Submitted January 14, 2009.
Decided February 2, 2009.

*857 Scott J. Bocker, Clifton, attorney for appellant.

Einhorn, Harris, Ascher, Barbarito & Frost, Denville, attorneys for respondent (Elizabeth M. Vinhal, on the brief).

Before Judges FISHER, C.L. MINIMAN and BAXTER.

The opinion of the court was delivered by

FISHER, J.A.D.

In this appeal, we review the denial of defendant's motion for a downward modification of his alimony and child support obligations. We conclude that in denying the motion the trial judge properly exercised his discretion particularly when viewed against the judge's findings—rendered after a multi-day plenary hearing approximately one year earlier—that defendant's claim of his law firm's plummeting fortunes was "unconvincing." As a result, we affirm.

The parties were married in 1984 and had three children. This divorce action was commenced in 2003 and a property settlement agreement (PSA) was executed on December 10, 2003. The parties stipulated in the PSA that defendant Gregory R. Donnelly, an attorney, would pay plaintiff Elizabeth Donnelly $1,000 per week in *858 permanent alimony and $350 per week in child support for the three children, who were born in 1994, 1995 and 1997. The PSA declared that the parties would share joint legal custody of the children, but that Elizabeth would "retain primary residential custody." A dual judgment of divorce, which incorporated the terms of the PSA, was entered on January 5, 2004.

The PSA indicates that the alimony award of $1,000 per week was based upon the imputation of income to Elizabeth in the annual amount of $20,000. It also expressly stated that an expert was retained to evaluate Gregory's income and the value of his business. The expert, according to the PSA, fixed Gregory's annual income—for purposes of determining the appropriate level of alimony and child support—at $185,000.[1]

On April 21, 2005, Gregory moved for a reduction in his support obligations, claiming he was not earning at the $185,000 level. In his certification, Gregory criticized the expert for not "tak[ing] into account the steady decrease over the years." Gregory claimed that 1998 and 1999 were "banner years and represented the highest income [he] ever achieved since [he] began [his legal] career," and he had not since 2000 achieved the average yearly income adopted by the expert.

Gregory explained that his level of income suffered

a steadfast decrease each year ... primarily due to increased competition; rising office expenses and a decrease in gross income. The decrease in gross income is due to a marked decline in our personal injury and real estate practice. My personal injury practice has suffered a steady decrease as a result of the Lawsuit Threshold and my real estate practice has suffered due to the number of new attorneys in the area who are constantly vying for business.

Gregory then asserted that his gross earnings for the year 2004 were $97,983 and "far less [than] what [the expert] computed and is more in line with the steadfast decrease I had been experiencing." Asserting he had an after-taxes income of $79,983 for 2004, Gregory claimed that with his alimony and child support obligations (aggregating in the annual amount of $70,200), the carrying cost of partnership property (nearly $70,000 per year) and his personal expenses (estimated at $75,000), he was running at a significant deficit. He argued that it is "absolutely impossible for me to maintain my practice, maintain a living, pay [Elizabeth] and contribute to an asset for which [Elizabeth] is also an equitable owner when I have no means of obtaining the funds necessary to do so." As a result, Gregory claimed he borrowed in excess of $130,000 to meet his obligations.

On the return date, the judge made no ruling on the merits but instead provided the parties with an opportunity to engage in discovery. The judge conducted a plenary hearing over the course of a few days in December 2006, and denied Gregory's motion for reasons set forth in a thorough written decision, which included the following findings:

During this period of time that [Gregory] claims that his income has drastically reduced, he within a very short period *859 of time after the [j]udgment of [d]ivorce, traded in a 2003 Lexus automobile for a 2004 model at a cost of $58,000.00. He also sold a property in Pines Lake, and used part of the proceeds to pay down a line of credit by $90,000.00 and then bought a new home for $785,000.00 also in Wayne. In doing so he took a mortgage in excess of $600,000.00, all at the same time he claims that he was earning approximately $80,000.00 for the year. Just before this hearing, [Gregory] remarried and spent approximately $15,000.00 between his wedding and honeymoon.

In light of these circumstances and the information contained in Gregory's September 2006 case information statement, the judge viewed Gregory's income as being "in the range of $140,000.00 for the year not the $100,000.00" that Gregory claimed. The judge also rejected Gregory's claim that he was indebted to the Internal Revenue Service in the amount of $55,000 because Gregory failed to provide any documentation to support that assertion.

In addition, the judge found no proof to support Gregory's claims about his practice's "deteriorating case load." He held that Gregory's testimony, which was the only evidence provided to establish the law firm's performance, was "unconvincing" and Gregory's testimony that he was unable to support the marital standard of living was "incredulous." Although unpersuaded that Gregory's level of income had substantially deteriorated, the judge also referred to our recent decision in Larbig v. Larbig, 384 N.J.Super. 17, 894 A.2d 1 (App.Div.2006), and held he was "not convinced" that Gregory's alleged decline in business "is of [a] permanent nature which inhibits his ability to sustain himself as well as child support and alimony payments" in the amount stipulated in the PSA.

On January 10, 2007, the judge entered an order denying Gregory's motion for a modification of his support obligations. Gregory did not appeal that final order. Instead, approximately nine months after entry of the January 10, 2007 order, Gregory again moved for a downward modification of his support obligations.

In this second Lepis[2] motion, Gregory again provided a general recital of his financial situation and the status of his law practice, and asserted a further downward dip in his income. Asserting that he had only earned $38,700 for the year as of his September 24, 2007 certification, Gregory predicted he would only earn $50,000 in 2007. He also indicated he had sold his interest in the law firm's building to his partner for $175,000. Although Gregory suggested the sale evidenced his deteriorating ability to pay support, this transaction actually improved Gregory's financial situation since it eliminated the annual $70,000 cost referred to in his prior Lepis motion and also generated additional funds. Gregory used those funds to pay down certain debts and eliminate the existing alimony and child support arrearages.

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Cite This Page — Counsel Stack

Bluebook (online)
963 A.2d 855, 405 N.J. Super. 117, Counsel Stack Legal Research, https://law.counselstack.com/opinion/donnelly-v-donnelly-njsuperctappdiv-2009.