DeSantis v. DeSantis
| Decision Date | 11 July 2017 |
| Docket Number | FA054003956S |
| Court | Connecticut Superior Court |
| Parties | Ruth Ann DeSantis v. Frank R. DeSantis |
UNPUBLISHED OPINION
The marriage of the parties was dissolved by decree of this court on October 19, 2006. Simultaneous therewith, the parties entered into a Separation Agreement (#171.00) which the court approved and incorporated by reference in the decree. They are the parents of three children, all of whom have reached their majority, one of whom has reached the age of 23 years to wit: Nicole Marie DeSantis, age 24; Jacqueline Grace DeSantis, age 22; and Christopher DeSantis, age 18. The matter comes before this court by way of the defendant husband's (" husband") Motion for Modification (#174.00) dated August 29, 2013, of the original unallocated alimony and support order. For her part, the plaintiff wife (" wife") has filed two motions for contempt and a motion for an educational support order (##175.01, 175.02 and 175.03), all dated September 9, 2013.
The husband is 55 years old and holds both a BS in Industrial Management from Purdue University (1983), and an MBA from Indiana University (1985). He described his health as " fair, " and he takes medication for high blood pressure cholesterol, and a thyroid condition. He had gall bladder surgery in 2015, and in addition, he has had knee surgery and two hip replacements, one of which has left him with a slight limp. However, none of these conditions prevents him from obtaining and pursuing some form of gainful employment. Prior to and during the marriage he was employed in the financial sector as an analyst, starting at approximately $35, 000.00 per year at the National Bank of Detroit, and eventually advancing well into seven figures with Donaldson, Lufkin, and Jenrette (" DLJ").
The husband left DLJ in March 2000. At the same time, his salary was approximately $1, 500, 000.00 as Associate Director of Equity Research. At that time, he exercised $2, 000, 000.00 in performance-based options and invested them, along with substantial family funds, in a new long-short equity hedge fund that he had formed called Copper Beech Capital. This entity enjoyed a very successful run with $850, 000, 000.00 in assets under management at its peak in 2005. Beginning with three employees, including himself, that number later increased to a dozen. The fund's principal outside investor was Goldman Sachs. However, by the time of the dissolution decree in October 2006, the fund was in serious trouble due to economic factors, as revenues dropped and investors redeemed their investments. At that time, the fund had between $30, 000, 000.00 and $35, 000, 000.00 in assets under management. The husband finally dissolved Copper Beech Capital Management, Inc. and related entities on November 5, 2007 (Exhibits #25 through #28), at which time he became the sole investor with approximately $7, 000, 000.00 in the fund. Shortly thereafter the " Great Recession" began.
The husband testified that in the years subsequent to the divorce, he has made diligent efforts to obtain suitable employment in his field of experience, and that he had some limited success, but nothing permanent. The evidence bears him out. In the interim, in 2009 he founded another hedge fund called Cyprium Capital, however, he was never able to secure adequate funding, and it also failed in the summer of 2010. He has paid his alimony and child support obligations through August 2013, largely from a combination of income and assets. Since that time, after placing the wife on notice of his inability to meet his obligation, he has made an initial payment of $5, 000.00 in September, followed by a minimum of $1, 000.00 per month thereafter. It was at this time that he filed a motion for modification. To his credit, he does not claim abject poverty; rather, he has offered evidence that he has an earning capacity of $80, 000.00 per annum. (Exhibits #41 through #44.)
The wife is 54 years old. Since the dissolution in October 2006, she has had extensive training as a life coach and in Reiki (relaxation) techniques, and she formed her own company called Ruth DeSantis, LLC in order to provide those services. According to her testimony, she dissolved the LLC in the fall of 2016, as she was concerned about the confidentiality of her clients' information because of the pending family action. She told the court that she could go back to this type of work, although to date it has not proven to be very profitable. She also testified that she has no physical impairments that would prevent her from working outside of the home. The court believes that she has, at a minimum, an earning capacity equal to the prevailing minimum wage for the State of Connecticut. In addition, the wife receives $96, 000.00 a year from her investment portfolio, including dividends, tax-exempt interest and dividends, and capital gains. Throughout the pendency of these postjudgment proceedings, she has incurred considerable attorneys fees, as well as fees for experts and investigators, all in a largely fruitless search to find income and assets she believed hidden by her former husband.
The wife has filed a Motion for Contempt (#175.01) dated September 9, 2013, in which she alleges that the husband is in contempt for failing to meet his alimony obligation. Articles 4.3 and 4.6 of the original unallocated order called for the payment of unallocated alimony and support as a certain percentage of his income, with fixed minimums. In addition, Article 4.11 provides that while the two eldest children reaching their majority shall not be grounds for modifying the unallocated order, it also clearly and unequivocally provides that when the youngest child Christopher reached his 18th birthday, that event would be deemed a substantial change of circumstances, and that child support would cease. Christopher turned 18 on May 3, 2016.
During the marriage, the parties set aside certain funds for the benefit of the children's education. These funds are in the form of investment accounts with the husband as custodian. The parties do not agree as to whether or not these funds have been properly applied, and the wife has filed a motion for contempt (#175.02) dated September 9, 2013, alleging that the husband has failed to fully comply with the order. The parties are not in agreement as to what constitutes " educational support." The wife's definition is a narrow one, and she contends that the term requires that the monies be spent directly for tuition, room and board, and other basic expenses. For his part, the husband has taken a broader view, and he has advanced the children money for expenses related to their education, not including direct payment for tuition. He looks upon these funds as a nest egg for the children, and that the agreement does not require a complete depletion of these accounts. In the absence of a clear and unequivocal order, it is hard to see where contempt lies for a breach.
All three of the children have either already attended or are currently attending college. At the time of the dissolution, the court reserved jurisdiction to enter an educational support order pursuant to General Statutes § 46b-56c, however, to date no such order has entered.
The matter was heard over five days, including final argument. The court continued the matter until May 18, 2017, at which time it was assigned for argument concerning an award of attorneys fees, and the evidence closed on July 6, 2017.
The Court, having heard the testimony of both parties, and having considered the evidence presented at hearing, as well as the factors enumerated in General Statutes § § 46b-56 46b-56c, 46b-62, 46b-82, 46b-84, 46b-86(a), 46b-87, and 46b-215a, including the Child Support and Arrearage Guidelines Regulations, hereby makes the following findings:
1. That the husband filed a Motion for Modification of Alimony and Child Support, Postjudgment (#174.00) dated August 29, 2013, in which he claimed a substantial change of circumstances since the entry of the decree, in that he is currently unemployed and has no income from employment; that the relative financial circumstances of the parties had changed; and that at that time two of their three children had reached their majority.
2. That an award of periodic alimony and/or child support may be modified upon the demonstration of a substantial change of circumstances since the date of the last order, unless the order itself clearly precludes modification; that Article 4.11 of the Separation Agreement clearly precludes a modification of the unallocated alimony and support order, where the basis is the elder two children reaching the age of majority; that, however, Article 4.11 also provided that a substantial change of circumstances would occur when Christopher reached his majority; and that where a substantial change of circumstances has been found, the court shall consider the factors set forth in General Statutes § 46b-82. General Statutes § 46b-86(a); Borkowski v. Borkowski, 228 Conn. 729, 737, 638 A.2d 1060 (1994); Schorsch v. Schorsch, 53 Conn.App. 378, 382, 731 A.2d 330 (1999); Spencer v. Spencer, 71 Conn.App. 475, 481, 802 A.2d 215 (2002).
That the evidence supports a finding that there has been a substantial change of circumstances since the date of the last order in that: (a) the husband's income has been substantially reduced; and (b) Christopher reached the age of majority on May 3, 2016. Sutherland v. Sutherland 107 Conn.App. 1, 6, 944 A.2d 395 (2008); and that said changes did not come about as a result of any " culpable conduct" on the part of the husband. Olson v. Mohammadu, 310 Conn. 665, 684, 81 A.3d 215 (2013)...
To continue reading
Request your trial