Esposito v. Esposito

• Decision Date: 20 March 1978
• Citation: Esposito v. Esposito, 158 N.J.Super. 285, 385 A.2d 1266 (N.J. Super. App. Div. 1978)
• Parties: Muriel ESPOSITO, Plaintiff-Appellant, v. Daniel Joseph ESPOSITO, Defendant-Respondent.
• Court: New Jersey Superior Court — Appellate Division

Page 285

158 N.J.Super. 285

385 A.2d 1266

Muriel ESPOSITO, Plaintiff-Appellant, v. Daniel Joseph ESPOSITO, Defendant-Respondent.

Superior Court of New Jersey,Appellate Division.

Argued Feb. 28, 1978.

Decided March 20, 1978.

James C. Orr, Newark, for plaintiff-appellant (Lum, Biunno & Tompkins, Newark, attorneys; Claire T. Barile, Newark, on the brief).

Everett M. Scherer, Newark, for defendant-respondent (Riker, Danzig, Scherer & Debevoise, Newark, attorneys).

Before Judges HALPERN, LARNER and KING.

The opinion of the court was delivered by

LARNER, J. A. D.

In this matrimonial action the wife appeals from the order of equitable distribution and the alimony award.

The parties were married in 1942 and had three children, all of whom were over 21 and emancipated as of the time of decision below. The marriage was apparently a harmonious one until their separation in 1969. Plaintiff filed her complaint for divorce in late 1971 alleging desertion, and defendant filed a counterclaim based on 18 months' separation. The trial judge granted each litigant a divorce on the respective grounds asserted by them in a judgment dated December 5, 1972. Issues of equitable distribution and support were reserved and ultimately were heard in a series of hearings between January and October of 1975. The court's decision was rendered in a letter opinion dated March 25, 1976, wherein the marital assets were distributed by allocating to the wife a new automobile and two parcels of real estate consisting of the marital home in Livingston and a summer home in Point Pleasant, and awarding all other assets to the husband. The judgment additionally provided for a weekly alimony of $275.

Plaintiff attacks the propriety of the equitable distribution order on two grounds: (1) the judge erred in arriving at the valuation of some of the assets, and (2) the division of the same was disproportionate and inequitable. There is no dispute on appeal as to the assets which are eligible for distribution. She also contends that the alimony award is inadequate.

I

In the presentation of the valuation of the marital assets the parties indicated their accord on the value of the following items, based upon an agreed valuation date for all eligible property as of March 31, 1975:

Asset                                  Value
                -----                                  -----
                Cash                                  $ 10,024
                Marketable securities                  145,000
                Life insurance policies (cash value)     7,353
                Precision Planning, Inc.                 -  0 -
                Livingston residence (net)             112,658
                Point Pleasant residence (clear)        62,000
                Florida condominium (net)               16,500
                Defendant's pension                      8,000
                Less: Accounts payable                  (4,500)
                                                      ---------
                    Net total of undisputed items     $357,035
                

The items whose valuation was in dispute involve the following:

Mutual funds

Limited partnership interests in real estate

Defendant's interest in automobile dealership known as Dan Esposito Olds, Inc.

Real estate holdings designated as Nassau Central Corp.,

Nassau Rose Holding Corp. and 355 Central Avenue, East Orange

Stock interest in Airmet, Inc.

The trial judge's finding on the valuation of these disputed items is limited to a mere statement: "I adopt as my fact findings * * * the values as set forth in defendant's memorandum on pages 8 through 20 * * *." This was a written summation submitted by counsel for defendant after the completion of the hearings.

It is noteworthy that there is no articulation by way of factual preference or analysis to support the carte blanche acceptance of defendant's contentions as to values. It is no more nor less than the purported findings in the case of Nochenson v. Nochenson, 148 N.J.Super. 448, 450, 372 A.2d 1139, 1140 (App.Div.1977), where the judge simply stated that he was in "agreement with the defendant's summation of the evidence submitted at the trial." As we noted in that opinion, such a finding is not an adequate finding of fact which can stand judicial scrutiny on appeal. See also, Benjamin Moore & Co. v. Newark, 133 N.J.Super. 427, 337 A.2d 371 (App.Div.1975).

In a complex financial case of this type it is particularly important that the judge make specific findings so that the parties and the appellate court may be informed of the rationale underlying his conclusion. Because of the absence of adequate articulation the following questions come to mind. Why did the judge accept each of the valuations advanced by defendant? Why were they more reliable evidentially than those submitted by plaintiff? What were the elements in the evidence which led to such a wholesale acceptance of the argument of one side of the controversy versus the other side? And furthermore, which of defendant's values did the judge accept as to those items where defendant vacillated between differing proposed valuations? The conclusory reliance upon a party's argumentative position relating to a series of disputed valuations of several different property interests renders the judge's findings in this respect valueless. As a consequence, we cannot and will not apply the normal standard of review which limits us to the determination whether there is sufficient credible evidence in the record to support the trial court's finding. See State v. Johnson, 42 N.J. 146, 162, 199 A.2d 809 (1964). Accord, Close v. Kordulak Bros., 44 N.J. 589, 598-599, 210 A.2d 753 (1965). See also, Benjamin Moore & Co. v. Newark, supra.

Normally, the nature of these findings would require a remand to the trial judge to make meaningful findings of fact. However, since the judge who decided the case is now retired, we do not deem it appropriate or fair to the litigants to remand the case for a retrial by another judge, which would entail a tremendous expenditure of time and money for both parties. We therefore invoke our original jurisdiction under R. 2:10-5 and proceed to determine the merits of the controversy on the existing record.

All of the assets were acquired during marriage and did not arise through gift or inheritance. As a consequence, there is no issue as to the nature of the assets subject to distribution and, as already noted, there is no dispute as to the valuation of some of the items. We shall therefore limit our factual determination of value to the disputed items and apply the valuation date of March 31, 1975, as accepted by the parties and the trial judge.

Mutual Funds

Defendant proposed and the judge accepted a value for the mutual funds held by defendant of $24,429, which concededly was the quoted value as of August 31, 1974. This was manifestly erroneous in view of the stipulated valuation date of March 31, 1975. As of that date the values computed by plaintiff's accountant from mesne figures between bid and asked prices obtained from brokers amounted to $35,572. We find that the proper valuation of this item is $35,572.

Limited partnership interests in real estate

Defendant had interests in 12 limited partnerships in which he invested a total of $68,150. The book value as of the end of 1974 totalled $30,740 the figure suggested by defendant and accepted by the judge. The only evidence countervailing this valuation was that presented by plaintiff's accountant, who arrived at a total of $102,003 by using assessed valuations and a personal appraisal of the real estate. In view of the absence of competent expert testimony as to values, we find no basis for reliance upon the accountant's opinion in this connection. It is also apparent from the record that some of these properties fail to produce income and require replenishment of capital to maintain them. Under the circumstances reflected by the record, we are impelled to accept the book value of these interests as a fair valuation namely, $30,740.

Dan Esposito Olds, Inc.

The determination of the value of defendant's interest in the corporate enterprise known as Dan Esposito Olds, Inc., involves a two-step process: (1) the quantum of his true beneficial stock holdings and (2) the valuation of said interest.

The company is engaged in the sale of new and used cars under a General Motors dealership, with its place of business located on Central Avenue, East Orange. Prior to 1970 defendant was the owner of virtually all of the stock of the company. He asserts that he transferred in that year a 25% stock interest to a nephew who was employed in the business. The record is clear that this transfer, if made, was made without consideration and in order to satisfy a General Motors regulation relating to multiple dealerships which were contemplated by defendant at the time. However, except for the communication of the alleged transfer to General Motors, no stock certificate was ever issued, nor was documentary evidence of any kind presented which would establish the actual transfer. It is also significant that in answers to interrogatories, defendant admitted ownership of all the stock of the corporation except for two qualifying shares allocated to his wife and father. And neither the contemporaneous corporate records nor the corporate tax returns reflected any beneficial interest in anyone other than defendant himself.

Defendant's allegation as to his nephew's stock ownership is further muddied by the fact that defendant testified that he expected payment for the stock at some time, while the nephew testified that it was a gift.

In the face of the foregoing evidential record, the trial judge found that the nephew owned a 25% interest in the corporation and that defendant owned 75% thereof. We are satisfied that his conclusion is contrary to the weight of the evidence and that it clearly and convincingly appears to be a miscarriage of justice. Our careful review of the record convinces us that defendant was and is the beneficial owner of all of the stock of Dan Esposito Olds, Inc.

We next turn to the...