Summary
In Maharam, the Appellate Division approved "[p]enalizing one party in the distribution of assets from a marital estate... where [the party's] egregious economic misconduct... prevented the court from making an equitable determination."
Summary of this case from S.M. v. M.M.-M.Opinion
December 11, 1997
Appeal from the Supreme Court, New York County (Richard Andrias, J.).
Penalizing one party in the distribution of assets from a marital estate is appropriate where his egregious economic misconduct has prevented the court from making an equitable determination (Goldberg v. Goldberg, 172 A.D.2d 316, 317, lv dismissed 78 N.Y.2d 1124; see generally, Blickstein v. Blickstein, 99 A.D.2d 287, 292, appeal dismissed 62 N.Y.2d 802). The factors considered in so adjusting an equitable distribution must be set forth by the court (Capasso v. Capasso, 119 A.D.2d 268, 272), and where the trial court fails to list those factors, the Appellate Division may do so upon an adequate record (O'Brien v. O'Brien, 66 N.Y.2d 576, 589).
This record is replete with evidence that defendant secreted assets in a foreign bank account, thus preventing the court from making an accurate assessment of the size of the marital estate. He also squandered sizable sums on luxury items and in admitted adulterous affairs. Under the circumstances, a 65%-35% division of marital property is appropriate (see, Conceicao v. Conceicao, 203 A.D.2d 877, 879).
Erroneously excluded from the trial court's listing of assets was a $264,000 consulting fee received by defendant in 1983. This fee should have been included, not because of its chronological relationship to the valuation of the marital estate, but rather because it was received in connection with the sale of defendant's business. Likewise, $8,015 in interest payments received by defendant on the sale of his share of a Chicago business affiliate should have been included, inasmuch as the principal amount of the note was considered to be an estate asset.
Plaintiff's testimony was uncontroverted that she brought about $10,000 to the marriage, and that her parents contributed $2,450 as a down payment on the parties' first home. She should thus have been credited with this sum.
Defendant's credit for sums previously paid to plaintiff, concededly governed by a 1987 stipulation between the parties, should be proportionally reduced with respect to $40,000 that he withdrew from an escrow account for plaintiff's legal fees, and with respect to plaintiff's share of interest on the parties' escrow account for the sale of the marital residence. This amounts to an adjustment of $63,567.75 in plaintiff's favor.
On this appeal, plaintiff seeks to have two sizable sums included in the marital estate. The first is $775,437 in interest allegedly payable to defendant on the note he received for sale of his share in the textile business. The second is the balance of two stock accounts with Thomson McKinnon Securities (valued at either $279,067.30 or $163,687.69). Both would appear to be marital assets, but plaintiff has failed to point out where she ever asked the trial court for inclusion of these items.
We agree with the trial court's determination that the commencement of this action is the appropriate valuation date for the marital estate, notwithstanding a contrary pre-trial ruling by another Judge. This was a matter within the sound discretion of the trial court, and there is no indication that that court was ever requested to take judicial notice of the prior ruling. Furthermore, the Appellate Division is not bound by the doctrine of law of the case.
Finally, plaintiff is entitled to interest on her entitlement since the divorce judgment in 1984, which is the date she claims for valuation of the marital estate. Such interest represents a charge for the use of another's money, rather than a penalty for fault (Selinger v. Selinger, 232 A.D.2d 471, 473, lv denied 90 N.Y.2d 842).
We have reviewed plaintiff's other contentions and find them to be without merit.
Concur — Milonas, J. P., Ellerin, Wallach and Rubin, JJ.