El-Dehdan v. El-Dehdan

• Decision Date: 20 October 2015
• Docket Number: No. 90.,90.
• Parties: Jacqueline EL–DEHDAN, Respondent, v. Salim EL–DEHDAN, Also Known as Sam Reed, Appellant.
• Court: New York Court of Appeals Court of Appeals

26 N.Y.3d 19
41 N.E.3d 340
19 N.Y.S.3d 475
2015 N.Y. Slip Op. 07579

Jacqueline EL–DEHDAN, Respondent
v.
Salim EL–DEHDAN, Also Known as Sam Reed, Appellant.

No. 90.

Court of Appeals of New York.

Oct. 20, 2015.

Barket Marion Epstein & Kearon, LLP, Garden City (Donna Aldea, Bruce A. Barket and Alexander R. Klein of counsel), for appellant.

Alomar & Associates PC, Ridgewood (Karina E. Alomar of counsel), for respondent.

OPINION OF THE COURT

RIVERA, J.

41 N.E.3d 341

Defendant challenges a determination of civil contempt for his failure to comply with a January 2010 order issued in the course of the parties' matrimonial proceeding. That order requires him to deposit in escrow the proceeds of the sale of properties which are the subject of a prior equitable distribution determination in favor of plaintiff.

We conclude that plaintiff met her burden in support of her motion for civil contempt by establishing that defendant violated a lawful, clear mandate of the court, of which he had knowledge, and that such violation resulted in prejudice to her rights. We reject defendant's contentions that a civil contempt determination requires a finding of a contemnor's wilful violation of the underlying order, and that Supreme Court could not draw a negative inference from defendant's invocation of his

Fifth Amendment right against self-incrimination at the contempt hearing.

We, therefore, conclude that the evidence adduced at the hearing established a sufficient basis for the civil contempt judgment. Accordingly, we answer in the affirmative the certified question as to whether the Appellate Division properly affirmed Supreme Court.

I.

Defendant, Salim El–Dehdan, also known as Sam Reed, concedes that he has

41 N.E.3d 342

not complied with an order issued in a matrimonial proceeding commenced by plaintiff Jacqueline El–Dehdan, defendant's former spouse. To address the specific issue of the propriety of the contempt order challenged in this appeal, we begin with a review of the somewhat tortuous procedural history of the parties' matrimonial action.

A. The Matrimonial Action for Divorce and Equitable Distribution

In October 2008, plaintiff commenced an action for divorce and equitable distribution, and thereafter moved by order to show cause for pendente lite relief seeking, in part, to restrain defendant's transfer of any real property held jointly or individually by the parties. The signed order to show cause set a hearing date on the motion, but did not include a restraint on the transfer of defendant's property. Soon thereafter defendant cross-moved to dismiss the matrimonial action as barred on res judicata grounds, claiming the parties were divorced pursuant to a Lebanese judgment, and furthermore, that plaintiff's prior New York divorce action was dismissed with prejudice.

At an initial court appearance in January 2009, Supreme Court indicated that another hearing would likely be necessary on the question of the legality of the Lebanese divorce. The record of the hearing demonstrates that the court and the parties were under the impression that the October 2008 order to show cause mandated a restraint on defendant's properties, and that the court intended to extend that restraint into the future. Before adjourning to permit additional submissions by the parties, the following colloquy ensued.

“THE COURT: ... I get the feeling I'm going to need a hearing. I get the feeling you're going to need a lot of different people coming in to testify. But I'm going to keep the status quo. All restraints will remain in full force and effect pending further order of this Court ....

“[DEFENDANT'S COUNSEL]: Just for clarification, as far as restraining orders, what is being restrained?

“THE COURT: All their assets.

“[DEFENDANT'S COUNSEL]: Joint assets, your Honor?

“THE COURT: Anything you have. Bank accounts, you can't close out any accounts. Any buildings, you can't sell, mortgage, can't do anything. And don't violate my order.

“THE DEFENDANT: Of course. I have nothing anymore, your Honor. I have no business anymore, because I been [sic] recovering from the expenses that I paid for the year 2000.

“THE COURT: Okay. We're going to see what expenses were paid.”

Notwithstanding defendant's statements that he would comply with the court's directive and that he did not have any property that would be subject to restraint, within a few weeks of this court appearance, defendant contracted to transfer one of his real properties, which he then sold the following month. A week later, he contracted to sell another property. Specifically, he entered into a contract to sell 171 Ainslie Street, Brooklyn, New York, also known as 254/256 Leonard Street, on February 24, 2009, and then transferred this property on March 31, 2009. He also contracted to sell and transferred 60–17 60th Road, Maspeth, New York on April 6, 2009. Defendant would later concede that he transferred the Brooklyn property for $950,000, and the Maspeth property for no consideration.

At the next hearing, held on February 4, 2009 and attended by defendant and his counsel, the court informed the parties

41 N.E.3d 343

that it was sending the legal validity of the Lebanese divorce and the equitable distribution matters to a referee for a hearing and recommended determination. The court then referenced property in defendant's control, saying, “I think there's some money out there. But right now, you want to hold on to your money, that's fine.” The court continued, “[w]e are going to go

for a hearing. If, in fact, you are divorced, then we will move on to the next issue of equitable distribution. If you are not divorced, we are here anyway.”

Defendant failed to appear at the scheduled April 2009 date for the referee's hearing. At that time, defendant's counsel moved to be relieved from the case, and stated that she had told defendant that his appearance at the hearing was required, and that counsel would seek to be relieved. Supreme Court granted counsel's motion.

The court then held defendant in default for failure to appear, and denied, with prejudice, defendant's pending motion to dismiss plaintiff's matrimonial proceeding. The court adjourned the referee's inquest on equitable distribution, and modified the assignment to include consideration of plaintiff's grounds for divorce.

Although served with notice, defendant failed to appear at the October 2009 rescheduled referee's inquest. Nevertheless, the referee proceeded with the inquest, issued a decision granting plaintiff's motion for divorce on grounds of cruel and inhuman treatment, awarded plaintiff exclusive title to the Brooklyn and Maspeth properties and awarded title to defendant in property located in Glendale, New York, and a dry-cleaning business he owned and operated.

Supreme Court subsequently denied defendant's motions to vacate the April 2009 denial of his cross motion to dismiss plaintiff's matrimonial action, as well as the referee's decision granting a divorce and equitable distribution. The Appellate Division dismissed defendant's appeal from this decision.

B. Plaintiff's Motion for Civil Contempt and Deposit of the Transfer Proceeds

After plaintiff's attorney learned defendant had transferred the Brooklyn and Maspeth properties, she filed an order to show cause seeking, inter alia, that defendant be held in civil contempt for violation of the October 2008 order, and that he be required to deposit the proceeds from the transfers with plaintiff's attorney. Thereafter, in January 2010, Supreme Court signed the order to show cause, which in addition to scheduling a hearing on plaintiff's contempt motion, directed defendant to immediately deposit with plaintiff's counsel the net proceeds of the transfers, reduced by broker's fees, taxes

and mortgage payments.¹ Defendant was personally served with this order to show cause.

As is clear from the record of the contempt hearing, the court and all the parties were under the mistaken belief that the October 2008 order to show cause prohibited the transfers. Supreme Court found defendant in contempt and ordered him incarcerated until he paid $1,500,000 and returned the deeds and ownership of

41 N.E.3d 344

the Brooklyn and Maspeth properties and the dry-cleaning business to the marital estate. Defendant remained incarcerated for two weeks, until defendant's new counsel discovered that the October 2008 order to show cause contained no restraint provision and brought the matter to the court's attention, whereupon the court ordered defendant's immediate release.

C. Plaintiff's Motion for Civil and Criminal Contempt Based on the January 2010 Order

In August 2010, plaintiff filed a motion to hold defendant in civil and criminal contempt for his failure to deposit the proceeds with plaintiff's attorney as required by the January 2010 order. Defendant cross-moved...