Opinion
2005-239.
Decided March 26, 2008.
Michael E. Osburn, Esq., Attorney for Plaintiff, Vestal, NY.
Michael A. Jacobs, Esq., Attorney for Defendant, Jacobs Jacobs, Stamford, NY.
Before the Court are a motion to vacate and a cross motion to enforce a separation agreement entered into between the parties on August 1, 2006. (Exhibit B to Order to Show Cause). This agreement was the subject of a hearing on August 15, 2006 at which the parties stipulated in court to resolve the pending divorce action on the basis of the separation agreement as modified by some recommendations of the law guardian for the child of the parties. (Exhibit A to Order to Show Cause). At the time plaintiff had discharged his attorney and was acting pro se in regard to the separation agreement and in court.
The underlying action was commenced on or about March 15, 2005 by service of a summons and shortly thereafter a complaint. The parties were married March 26, 2001 and have one child, Andrew, born June 9, 2002. Defendant has two children from a previous marriage. On March 28, 2005 this court issued a temporary order granting defendant exclusive occupancy of the marital residence, temporary child support of $1,133 per month, temporary maintenance of $867.00 per month and directing that plaintiff pay the mortgage and other expenses of the marital residence.
As set forth above the parties apparently resolved the divorce action with the separation agreement as modified and stipulated to in Court on August 15, 2006. Nothing further occurred until November 15, 2007 when defendant's attorney wrote the court to submit proposed Findings of Fact and Judgment. Shortly thereafter on December 3, 2007, the court was informed by letter from new counsel for plaintiff that plaintiff and defendant had been living together since the separation agreement was signed and that plaintiff believed the parties had reconciled and abandoned the divorce proceedings. (Osburn Affidavit, dated January 7, 2008, and Exhibit K).
After a telephone conference with the attorneys on December 5, 2007, this court issued an Order dated December 14, 2007 which again provided for exclusive occupancy of the marital residence to defendant, set a visitation schedule for Andrew, and allowed plaintiff 30 days to move to rescind or vacate the separation agreement and oral stipulation.
Plaintiff first argues that the divorce action, resulting in the separation agreement and stipulation, has been abandoned. Uniform Rule 202.48 provides that where the court directs an order or judgment to be "settled or submitted on notice, must be submitted for signature . . . within 60 days after the signing and filing of the decision directing that the order be settled or submitted." The Court of Appeals in Funk v Barry 89 NY2d 364 (1996) held that "the 60-day period applies only where the court explicitly directs that the proposed judgment or order be settled or submitted for signature." There was no written decision in this case and thus no explicit order. Nor was there any explicit direction at the close of the hearing to submit a judgment. (See transcript, Exhibit A to Order to Show Cause). Thus Rule 202.48 is not applicable and the action cannot be deemed abandoned for failure to comply with the 60 day limit.
Next plaintiff claims the separation agreement is invalid because the parties were living together as husband and wife at the time the agreement was signed. "It is fundamental that, in the absence of the parties actual separation at the time of execution of a separation agreement or immediately thereafter, a separation agreement is void ab initio . . . " Costa v Costa 192 AD2d 1034 (3d Dept. 1993); Matter of Wilson 50 NY2d 59 (1980). The trouble in this case is that the parties' affidavits are diametrically opposed as to whether they were separated or living together when the agreement was signed. (Plaintiff Affidavit, dated January 5, 2008, p. 5; Defendant Affidavit dated February 6, 2008, pp. 5 9). Judgment cannot be granted and a hearing is required where there are triable issues of fact. Phillips v Joseph Kantor Co. 31 NY2d 307 (1972). The conflicting affidavit testimony of the parties presents such a factual conflict.
But even assuming the parties were not living together when the separation agreement was signed, plaintiff alleges they thereafter reconciled and resumed cohabitation. "Mere cohabitation alone does not by itself destroy the validity of the separation agreement but must have as an added ingredient an intent to reconcile." Markowitz v Markowitz 52 AD2d 521 (1st Dept. 1976). Plaintiff alleges that the parties resumed living together in July 2006 and continued to do so until December 2007. (Plaintiff's Affidavit, p. 6) He also claims they intended to reconcile and abandon the separation agreement (Affidavit p. 12). Defendant states in her affidavit that plaintiff begged for a reconciliation and "would sign an agreement giving me everything" (Affidavit p. 8). She admits he moved back into the marital residence sometime in September 2006. (Affidavit p. 9). This fact is supported by the Affidavit of Mariellen Myers, dated February 6, 2008. at p. 2, a friend of defendant, who states plaintiff began to stay overnight at the house in late August 2006 and moved back full time in the Fall of 2006. (Myers Affidavit, p. 2).
The fact that defendant did not direct her attorney to submit findings of fact and judgment for 15 months after the hearing in August 2006 is strong evidence there was actually a reconciliation. So too is the fact that they filed joint income tax returns for 2006. (Attachment to Plaintiff's Net Worth Statement, dated February 29, 2008). Nowhere in defendant's affidavit does she specifically deny there was a reconciliation. In Zimtbaum v Zimtbaum 246 AD778 (2d Dept. 1935) a reconciliation of 8 months was sufficient to annul a separation agreement. See also Mullen v Mullen 260 AD2d 452 (2d Dept 1999); Matter of Whiteford 35 AD2d 751 (3d Dept. 1970). The court finds that both parties have admitted they resumed living together and reconciled for about 15 months thus invalidating the separation agreement.
Even if we assume there was no reconciliation there is another independent reason to invalidate the separation agreement. It is clear that a separation agreement may be set aside if it is unfair, unreasonable or unconscionable. DRL § 236 (B)(3); Christian v Christian 42 NY2d 63 (1977). A stipulation in open court settling a matrimonial action may also be set aside for unconscionability. Uhl v Uhl 274 AD2d 915 (3d Dept. 2000).
An unconscionable bargain has been regarded as one "such as no person in his or her senses and not under delusion would make on the one hand, and as no honest and fair person would accept on the other'", the inequality being" so strong and manifest as to shock the conscience and confound the judgment of any person of common sense'". Christian v Christian, supra at 71.
At the time of commencement of this action in 2005 the parties had been married for four years, they have now been married seven years. The parties are both now 38 years of age. Plaintiff is a chiropractor with a practice that produced almost $200,000.00 of income in 2006. (See 2006 Tax Return, Schedule E attached to Plaintiff's Net Worth Statement). He received his degree and license before the marriage. (Plaintiff's Affidavit, p. 3). Defendant is a stay at home mother. She has a BA degree in Education and taught for 5 years under provisional certification, but now needs to return to college for a Masters degree to return to teaching. (Defendant Affidavit p. 22). However, she is home schooling the parties' son. (Defendant Affidavit p. 18).
The separation agreement provides among other items for Plaintiff to pay to or for defendant:
1) Maintenance of $3,000.00 per month for life, even if she remarries or cohabits with another adult. Article VII.
2) All payments on the $194,742.00 mortgage balance on the marital residence until paid in full-$1,847.74 per month — Article VI
3) Real estate taxes, water and sewer rents, insurance, electric and fuel oil and any other expenses of upkeep of the residence. Article VI(2)
4) To provide her with an automobile for life. Article VI(5)
5) Medical insurance for her lifetime. Article VIII
6) Medical insurance for defendant's two children from a prior marriage (not adopted by plaintiff) to their age 21. Article VIII(6)
7) All of her attorneys fees. Article X at p. 19.
8) $500,000 Term Life Insurance for benefit of defendant for life. Article IX
The agreement also requires plaintiff to pay for their son:
1) Child support of $3,000 per month until age 21 or completion of college or graduate school, whichever is later. Under CSSA child support would be no more than $1,817 per month based upon the 2006 tax return. ($203,417 income less $36,000 maintenance, $22,172 additional maintenance as mortgage payments and $16,987 self employment tax x 17%). This does not take into account any subtraction of maintenance from the house expenses, car and medical insurance to defendant for life, nor the $80,000 limit on basic child support. Article VI(A).
2) All college and graduate school expenses, without any subtraction for scholarships or loans he might receive. Article VI(A).
3) All expenses of extra curricular activities and summer camp. Article VI(A)(2).
4) $500,000 life insurance for his benefit to age 25. (Article X).
For equitable distribution the agreement provides:
1) For transfer of the marital residence to defendant. Article VI(9)
2) For plaintiff to pay all marital debt, including the mortgage on the marital residence and reimbursement to defendant's parents for advances claimed to have been made to her. Article VI, at p. 11-12.
3) For transfer to defendant $8,000 plus $3,533 from a property sold. Article VI(8) and 10(a).
4) Plaintiff to retain his interest in his chiropractic practice. Article VI(3). As pointed out above, plaintiff obtained his education and license prior to marriage.
5) Plaintiff to retain his one half interest in two commercial buildings used as chiropractic offices for him and his partner. Article VI(10)(b) and (c) and Plaintiff's Net Worth Statement, p. 10.
It must be noted that the separation agreement is incomplete. It omits and fails to provide for the disposition of three items — a brokerage account valued at $5,500, 69 Meredith Street, Delhi, NY and vacant land on NYS 23, Davenport, NY (Plaintiff's Net Worth Statement, pp. 8, 10 11).
Plaintiff maintains the provisions of the separation agreement are unfair and unconscionable. It shocks the conscience of this Court. Numerous cases have been set aside for unconscionability where spouses of approximately defendant's age of 38 have been given lifetime maintenance, not to mention car, medical insurance, life insurance and utility payments for life. .
Two Third Department cases are particularly relevant. In Culnan v Culnan 142 AD2d 805 (3d Dept. 1988) the court described the parameters for maintenance as follows:
"the concept of maintenance . . . seeks to allow the recipient spouse an opportunity to achieve [economic] independence'" Thus, even where the circumstances of a case warrant an award of maintenance, an important consideration is the duration of such award. The time period is that necessary to give a spouse a reasonable amount of time to become self-supporting. Indefinite maintenance has been upheld where a marriage was of long duration and a spouse was older and unlikely to have an opportunity to obtain the education or experience necessary to become self-supporting in the reasonably foreseeable future. However, it has been limited where the recipient spouse is relatively young and healthy and able to enter the work force." (Citations omitted).
The defendant wife in Culnan was 29 with a high school education, some work experience and a nine year old child. The marriage had lasted for seven years. The Appellate division limited maintenance to ten years.
In Soule v Soule 252 AD2d 768 (3d Dept. 1998) the defendant was 37 years old with a high school diploma, some work experience and two children, ages 7 and 13, and the marriage had lasted 14 years. Again the Appellate Division limited maintenance to 10 years stating:
"Thus, even crediting her testimony as to the limited employment opportunities presently available to her in the Village of Cooperstown, Otsego County, an award of maintenance of $400.00 per week for the next 10 years would provide defendant with both the time and the resources to pursue further education or retraining, thereby enabling her to, if necessary, ultimately seek employment elsewhere."
Other relevant cases include Shink v Shink 140 AD2d 506 (2d Dept. 1988) and Granade-Bastuck v Bastuck 249 AD2d 444 (2d Dept. 1998). In Shink the 31 year old plaintiff held a degree in fashion merchandising and had been employed in the field. The parties had been married for four years and had one minor child. Maintenance was limited to $150.00 per week for five years. In Bastuck there was an 11 year marriage with one child, age 4, about to enter kindergarten. The plaintiff wife was one course short of obtaining her teaching certificate. Maintenance was limited to four years to enable her to remain with her young son for awhile and finish her teaching certificate and obtain employment. The court said:
"Maintenance is designed to give the spouse economic independence and should continue only as long as is required to render the recipient self-supporting. In addition, while insuring that the plaintiff's reasonable needs are provided for, it should also provide her with an appropriate incentive to become financially independent."
See also Tartaglia v Tartaglia 260 AD2d 628 (2d Dept. 1999); Love v Love 251 AD2d 631 (2d Dept. 1998); Burns v Burns 193 AD2d 1104 (4th Dept. 1993).
As can be seen from the above cases, the key factor in maintenance awards is the amount of time required for the recipient spouse to achieve economic independence and become self supporting. Defendant is 38 years old, has a Bachelors Degree in education and previously taught for 5 years under provisional certification. She needs to secure a Masters degree to continue teaching which takes about one to two years, in the meantime she can substitute teach. On the other hand, if she chooses not to resume teaching she is relatively young with a college degree and the parties' young son, age five, could be in school. Thus she should be able to secure employment fairly soon and achieve economic independence.
In either event, she does not require lifetime maintenance, plus lifetime provision of an automobile, health insurance, life insurance, and all expenses of the marital residence to secure employment and become self supporting. Such provisions are excessive and unconscionable.
The equitable distribution provisions of the agreement are similarly unfair. Primarily the unfairness is because the provisions for equitable distribution of property are interdependent with the provisions for lifetime payments that would ordinarily be considered maintenance. For example, Article VI titled "Equitable Distribution" provides for the marital residence to be transferred to defendant and for plaintiff to receive his chiropractic practice and two parcels of real property where the practice is located. Article 6 also provides for defendant to receive a car for life and full payment of the mortgage on the residence as well as payment of taxes, insurance, water and sewer rents, electric and fuel oil and expenses for upkeep (presumably repairs) of the residence for life.
In the separation agreement in Tartaglia v Tartaglia, supra defendant wife received the bulk of the marital assets and $52,000 per year of maintenance, whereas plaintiff husband was left with $7,860 per year of income, from which he was required to pay medical and life insurance premiums for the defendant and the children. The court said:
"An agreement which results in an award of substantially all of the marital assets to one party while burdening the other party with substantial economic obligations is patently unconscionable."
Similarly here defendant wife receives the bulk of the marital assets while plaintiff is burdened with paying all the marital debt, plus mortgage, insurance, taxes, utilities and upkeep on the residence, medical and life insurance premiums, as well as maintenance and the wife's attorney fees. (Plaintiff Affidavit p. 18). Even though defendant will receive maintenance of $3,000 per month and is employable, she is not required to pay any expenses for her residence or to even provide her own automobile or medical insurance. Cf. DRL § 177.
It is impossible to separate the elements of equitable distribution from the various lifetime maintenance payments that make up the bargain in the agreement. As a result the entire agreement is the result of overreaching and is unconscionable. Plaintiff in his reply affidavit points to the statement at the hearing by defendant's attorney as evidence of this.
"I think I resolved just about everything that I can imagine in my wildest imagination in this agreement, including what might be outside the earth's atmosphere." (Transcript p. 8).
As pointed out above, the child support of $3,000.00 per month exceeds what would be computed using CSSA, even ignoring the fact that child support on amounts over $80,000 income are in the court's discretion. Under the agreement college and graduate school are to be paid by plaintiff without subtraction for scholarships or loans. But even more significant the separation agreement does not include the required computation of combined parental income and what the amount of basic child support would have been. DRL § 240(1-b)(c), (h). Accordingly the child support provisions of the separation agreement are invalid and unenforceable. Tartaglia v Tartaglia, supra.
The court notes that at the time this agreement was reached plaintiff was acting without an attorney and was begging to reconcile with his wife. As even admitted by his wife "he said he would sign an agreement giving me everything." (Defendant Affidavit p. 8). As a result he was persuaded to give up, in the words of her attorney who negotiated the agreement with plaintiff acting pro se,"what might be outside the earth's atmosphere". Such an agreement cannot stand and must be reopened and renegotiated in a calmer more reasonable atmosphere, particularly after the parties resumed cohabitation for 15 months. The separation agreement is so unfair that no person in his senses would make it on the one hand, and as no honest and fair person such as defendant would accept on the other. Christian v Christian, supra at 71. The court holds that the Separation Agreement between the parties dated August 1, 2006 and oral stipulation in court on August 15, 2006, are void and unenforceable as unfair and unconscionable to plaintiff.
Defendant's cross motion is denied.
The court's temporary orders of March 28, 2005, December 14, 2007 and March 13, 2008 as modified therein shall remain in full force and effect.
This decision constitutes the order of the court.