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Glazer v. Glazer — Appellate Division, Third Dept. (Feb. 18, 1993)

Factual and Procedural Background

The parties were married in June 1962, had two children (one then emancipated) and raised plaintiff's two children from a prior marriage. Plaintiff commenced this divorce action in February 1985; the case was removed from the calendar after a July 1986 reconciliation (which lasted about one year) and later restored. Following a nonjury trial, Supreme Court granted both parties divorces and held a separate trial on equitable distribution, maintenance, child support and custody of the unemancipated daughter (born 1974). Supreme Court awarded defendant custody (with liberal visitation to plaintiff), sole possession of the marital residence and furnishings, title to a joint savings account containing $10,926.68, and a distributive award of $50,000 payable in ten semiannual installments of $5,000. Plaintiff received a checking account (~$2,000), title to pension and retirement benefits in his name, two bond funds and an annuity. Supreme Court ordered plaintiff to pay maintenance of $100 per week for 10 years and child support of $175.18 per week. Plaintiff appealed.

Legal Issues Presented

  1. Whether Supreme Court abused its discretion in distributing marital assets and awarding equitable distribution.
  2. Which assets are marital property and the proper valuation of those assets (marital home downpayment, plaintiff's pension fund, Travelers Tax Shelter Annuity, two bond funds, and joint savings account).
  3. Whether the maintenance award was appropriate under applicable statutory factors.
  4. Whether the Child Support Standards Act (CSSA) was properly applied and child support correctly calculated.
  5. Whether the custody and visitation order should be disturbed (and whether the issue is moot).

Arguments of the Parties

Appellant's (Plaintiff's) Arguments

  • Supreme Court abused its discretion in the distribution of marital assets.
  • $5,000 of the marital home downpayment and $6,000 of the joint savings were plaintiff's separate property (acquired by inheritance) and should not have been treated as marital property.
  • The two bond funds and other assets acquired after commencement should not be treated as marital property.
  • The Child Support Standards Act should not have been applied (plaintiff contended CSSA inapplicable).

Respondent's (Defendant's) Arguments

  • All of plaintiff's contributions to the Travelers Tax Shelter Annuity were made during the parties' reconciliation and thus the fund's value is marital.

Table of Precedents Cited

Precedent Rule or Principle Cited For Application by the Court
Price v Price, 69 N.Y.2d 8, 11 Supports treatment of the marital home (and traceability of assets) as marital property. Used to confirm the marital home was marital property and to support traceability of bond funds to a marital annuity.
Majauskas v Majauskas, 61 N.Y.2d 481, 485-486 Pension fund contributions during marriage render the fund marital property. Applied to conclude plaintiff's pension fund was marital because contributions were made on his behalf during the marriage.
Cohn v Cohn, 155 A.D.2d 412, 413 Valuation of marital interests in pension plans should be measured by contributions during marriage and reconciliation periods. Referenced to require remittal for proper valuation of the pension fund limited to contributions made during the marriage and reconciliation.
Michalek v Michalek, 114 A.D.2d 655, 657 Placing burden on party claiming asset is marital and limits on treating post‑commencement acquisitions as marital. Applied to conclude Supreme Court erred in treating the entire Travelers Tax Shelter Annuity as marital where evidence showed acquisition from separate funds after commencement and defendant failed to meet her burden.
Ducharme v Ducharme, 145 A.D.2d 737, 738 Assets acquired with traceable marital funds are marital even if acquired after commencement. Used to uphold characterization of bond funds as marital because they were traceable to a marital annuity loan.
Di Nardo v Di Nardo, 144 A.D.2d 906, 907 Commingling separate assets in joint accounts can transform them into marital property. Applied to reject plaintiff's claim that $6,000 in the joint savings account remained separate after commingling.
Lischynsky v Lischynsky, 120 A.D.2d 824, 826-827 Commingling doctrine regarding joint accounts and transformation into marital property. Also applied to support the conclusion that commingled funds in the joint savings account are marital property.
Belsky v Belsky, 172 A.D.2d 576 Custody issues can become moot when the child reaches majority during appeal. Invoked to note the custody/visitation issue is moot because the daughter reached age 18 during the appeal.

Court's Reasoning and Analysis

The court first rejected plaintiff's claim of an abuse of discretion in asset distribution, finding Supreme Court properly considered statutory factors (including those in Domestic Relations Law § 236 [B] [5] [d]) and the marriage's long duration, custody disposition, plaintiff's income and defendant's domestic contributions. However, the court found errors in the characterization and valuation of specific assets requiring remittal:

  • Marital home: Properly classified as marital property, but $5,000 of the downpayment derived from plaintiff's parental inheritance and therefore should have been treated as plaintiff's separate property (citing Domestic Relations Law § 236 [B] [1] [d] [1]).
  • Pension fund: Properly marital under Majauskas because contributions were made during the marriage, but the only valuation used a December 31, 1988 date (after commencement and after a reconciliation). Because valuation included periods during which defendant made no contributions, remittal is required to value the pension fund based on contributions during the marriage and reconciliation (citing Cohn).
  • Travelers Tax Shelter Annuity: Supreme Court erred in treating the entire annuity as marital; evidence showed periodic contributions between March 1987 and June 1988 from separate funds acquired after commencement, and defendant did not meet her burden to establish the fund's marital value (citing Michalek).
  • Bond funds: Properly characterized as marital because they were purchased with an $18,000 loan traceable to plaintiff's Equitable Life Tax Shelter Annuity acquired during the marriage; therefore the bond funds are traceable to marital property (citing Price and Ducharme).
  • Joint savings account: Plaintiff's claim that $6,000 was separate by inheritance was rejected because commingling in the joint account transformed those funds into marital property (citing Di Nardo and Lischynsky).
  • Maintenance: The award of $100 per week for 10 years was not an abuse of discretion. The court weighed statutory factors (Domestic Relations Law § 236 [B] [6] [a]) — length of the 23‑year marriage, defendant's homemaker status and limited income (~$13,200), defendant's custody of the unemancipated child, and plaintiff's higher income (over $50,000) and educational background — and found the award appropriate.
  • Child support/CSSA: The court concluded the CSSA (Domestic Relations Law § 240 [1-b]) properly applies, but Supreme Court miscalculated support by failing to subtract plaintiff's FICA deductions and by omitting defendant's income from the calculation. Because correct CSSA computation could reduce plaintiff's obligation, remittal for recalculation was required.
  • Custody/Visitation: The appellate court found no grounds to disturb Supreme Court's custody order; however, the issue became moot when the daughter reached 18 during the appeal (citing Belsky).

Holding and Implications

Judgment modified and remitted; affirmed as modified.

Holding: The Appellate Division modified the judgment by reversing so much as awarded equitable distribution and child support and remitted the matter to Supreme Court for further proceedings consistent with this decision. As modified, the judgment was affirmed.

Implications: The direct effects are (1) remand for recomputation of equitable distribution amounts (including proper valuation of the pension fund and exclusion of the $5,000 inherited downpayment), (2) remand for recalculation of child support under the CSSA with proper deductions and inclusion of both parties' incomes, and (3) the custody/visitation determination was left intact but rendered moot by the child's attainment of majority. The opinion does not announce a new legal precedent beyond application of existing statutory and case law to the facts.

RICHARD B. GLAZER, Appellant, v. PATRICIA A. GLAZER, Respondent.

Harvey, J.

The parties to this action were married in June 1962 and had two children, one of whom is now emancipated. During the marriage, the couple also raised to adulthood plaintiff's two children from his first marriage. Plaintiff initially commenced this divorce action in February 1985, but the case was removed from the court calendar after the parties' reconciliation in July 1986. The reconciliation only lasted about a year, however, and the action was again placed on the calendar. After it was restored, a nonjury trial was held and Supreme Court granted both parties a divorce on various grounds. A separate trial was then held to determine issues of equitable distribution, maintenance, child support and the custody of the parties' unemancipated daughter (born in 1974). Supreme Court granted defendant custody of the parties' daughter (with liberal visitation to plaintiff) and also granted defendant sole possession of the marital residence and its furnishings, title to a joint savings account containing $10,926.68 and a distributive award of $50,000, payable in 10 semiannual installments of $5,000 each. Plaintiff was awarded a checking account in his name with a balance of approximately $2,000, title to all pension and retirement benefits in his name and title to two bond funds and an annuity. Supreme Court further ordered plaintiff to pay maintenance of $100 per week for 10 years and child support of $175.18 per week. This appeal by plaintiff followed.

Initially, we disagree with plaintiff that Supreme Court abused its discretion in its distribution of the marital assets. The court gave appropriate consideration to the statutory factors (see, Domestic Relations Law § 236 [B] [5] [d]). Accordingly, given the long-term nature of the marriage, the disposition of custody, plaintiff's relatively high income and defendant's contribution to plaintiff's career by raising the children while plaintiff furthered his education, we conclude that no abuse of discretion occurred in deciding how to distribute the marital assets. Nevertheless, because we find that Supreme Court made some errors in determining which assets were marital property, the matter must be remitted for a recomputation of the precise amounts awarded.

We note parenthetically that although the following discussion includes a consideration of the appropriate valuation of plaintiff's pension fund and two bond funds as marital property, Supreme Court's decision states at one point that the value of these items was deducted from the total marital property amount and that these funds would be awarded to plaintiff. Although it could be argued that this statement rendered the actual value of these funds irrelevant, we conclude that their actual value should be properly considered because the remainder of the court's decision leaves the impression that the value of these items, particularly the pension fund, impacted on how the remaining moneys and defendant's distributive award were granted. Accordingly, while it might be that knowledge of the actual value of these funds will not substantially alter the distribution of assets, we cannot make that assumption on this record.

Although the marital home was properly determined to be marital property (see, Domestic Relations Law § 236 [B] [1] [c]; Price v Price, 69 N.Y.2d 8, 11), the record reveals that $5,000 of the downpayment was provided from an inheritance from plaintiff's parents; this amount should therefore have been listed as plaintiff's separate property (see, Domestic Relations Law § 236 [B] [1] [d] [1]). Plaintiff's pension fund was properly considered to be marital property because contributions were made into the fund on plaintiff's behalf during the marriage (see, Majauskas v Majauskas, 61 N.Y.2d 481, 485-486). Nevertheless, we note that the only evidence introduced as to the value of the fund used a valuation date of December 31, 1988, several years after the commencement of this action. Although the parties were reconciled for approximately one year in this period, defendant apparently made no marital contribution to plaintiff's acquisition of these funds for a significant period of time which was nonetheless included in the valuation. Consequently, the matter must be remitted for a determination of the proper value of the pension fund measured by contributions made during the marriage and reconciliation (see, Cohn v Cohn, 155 A.D.2d 412, 413).

Similarly, we find that Supreme Court erred in determining that the entire value of the Travelers Tax Shelter Annuity was marital property. Although defendant contends that all of plaintiff's contributions to the fund were made during the parties' reconciliation, the evidence indicates that the fund was acquired by plaintiff with periodic contributions between March 1987 and June 1988 from separate funds acquired after the commencement of the action (see, Domestic Relations Law § 236 [B] [1] [c]). Because the reconciliation allegedly only lasted for approximately one year from July 1986, Supreme Court erred in finding that defendant had met her burden of establishing the value of an asset claimed to be marital property (see, Michalek v Michalek, 114 A.D.2d 655, 657, lv denied 69 N.Y.2d 602).

Despite plaintiff's contentions otherwise, we conclude that Supreme Court did not commit reversible error in determining that the two bond funds plaintiff apparently purchased after the commencement of this action were marital property. It appears from the record that the source of money for plaintiff's purchase of the bond funds was an $18,000 loan from plaintiff's Equitable Life Tax Shelter Annuity, which was acquired by plaintiff during the marriage (see, Price v Price, supra, at 11). Therefore, the bond funds were traceable to marital property despite the date of acquisition (see, Ducharme v Ducharme, 145 A.D.2d 737, 738, lv denied 73 N.Y.2d 708). As for plaintiff's assertion that $6,000 of the $10,926.68 in the parties' joint savings account was his separate property because he acquired it through an inheritance, this contention must also be rejected. Because plaintiff commingled his separate assets with marital assets in a joint account, the money was transformed into marital property (see, Di Nardo v Di Nardo, 144 A.D.2d 906, 907; Lischynsky v Lischynsky, 120 A.D.2d 824, 826-827).

Next, we find that Supreme Court did not abuse its discretion in fashioning an appropriate maintenance award under all the circumstances of the case. In making an award, consideration must be given to certain statutory factors, including (1) the length of the marriage, (2) the relative financial positions of the parties, (3) the parties' future earning capacity, and (4) the presence of children in the parties' respective lives (see, Domestic Relations Law § 236 [B] [6] [a]). Here, the parties were married for 23 years prior to commencement of the action, during which time defendant was a homemaker and only worked part time. Notably, defendant possessed only a high school diploma, earned $13,200 per year and was charged with custody of the parties' unemancipated child. In contrast, plaintiff had several advanced degrees, earned over $50,000 per year and did not have custody of any children. In light of these and other factors, we find Supreme Court's award appropriate.

With respect to the issue of child support, we find that although plaintiff's contention that the Child Support Standards Act (hereinafter the CSSA) (see, Domestic Relations Law § 240 [1-b]) should not have been applied is without merit, Supreme Court nevertheless improperly calculated the support award under the CSSA. Supreme Court was required to first determine the amount of the parties' gross income and then deduct maintenance payments and FICA deductions. The two adjusted incomes are then added, and that amount is multiplied by a set percentage, in this case 17% (Domestic Relations Law § 240 [1-b] [b] [3] [i]). The amount is then prorated in the same proportion as each party's income bears to the combined parental income. Here, in arriving at plaintiff's weekly support obligation of $175.18, Supreme Court failed to subtract plaintiff's FICA deductions and also neglected to include defendant's income in making its calculation. Because a computation using the correct CSSA amounts could well result in a reduced obligation for plaintiff, remittal for a recalculation of the support amount is required.

Finally, we have reviewed Supreme Court's custody and visitation order and find no grounds for disturbing it. In any event, because the record indicates that the parties' daughter reached the age of 18 during the pendency of this appeal, the issue of custody or visitation is moot (see, Belsky v Belsky, 172 A.D.2d 576). The remaining arguments of the parties not already addressed have been examined and rejected.

Mikoll, J.P., Yesawich Jr., Crew III and Mahoney, JJ., concur. Ordered that the judgment is modified, on the law, without costs, by reversing so much thereof as awarded equitable distribution and child support; matter remitted to the Supreme Court for further proceedings not inconsistent with this Court's decision; and, as so modified, affirmed.

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GLAZER v. GLAZER
(Feb 18, 1993)