Halaby v. Halaby, 3

• Court: New York Supreme Court — Appellate Division
• Decision Date: 06 December 2001
• Docket Number: 89327,3
• Citation: Halaby v. Halaby (N.Y. App. Div. 2001)
• Parties: REGINALD HALABY, Respondent, v CLAUDETTE HALABY, Appellant. 89327 SUPREME COURT OF THE STATE OF NEW YORK APPELLATE DIVISION: THIRD JUDICIAL DEPARTMENT Calendar Date:

REGINALD HALABY, Respondent v CLAUDETTE HALABY, Appellant

89327

SUPREME COURT OF THE STATE OF NEW YORK

APPELLATE DIVISION: THIRD JUDICIAL DEPARTMENT

Calendar Date: October 9, 2001

Decided and Entered: December 6, 2001

Alan J. Burczak, Plattsburgh, for appellant.

Patrick H. Cartwright, Albany, for respondent.

MEMORANDUM AND ORDER

Before: Mercure, J.P., Peters, Spain, Carpinello and Rose, JJ.

Peters, J.

Appeal from a judgment of the Supreme Court (Dawson, J.) ordering, inter alia, equitable distribution of the parties' marital property, entered June 26, 2000 in Essex County, upon a decision of the court.

In July 1998, plaintiff commenced this action for divorce, prompting defendant's answer and counterclaim. When plaintiff's request for an adjournment was denied, counsel appeared on his behalf and a one-day nonjury trial was held in June 1999. Supreme Court dismissed plaintiff's complaint, severed the counterclaim and dismissed plaintiff's reply thereto. Proceeding as a default in answering the counterclaim and receiving testimony to establish grounds for the divorce, an inquest was held to address issues of equitable distribution, maintenance, and the custody and child support for their one unemancipated child.

Defendant testified that although they were married on August 3, 1996, they lived separately as she pursued her Bachelor's degree and he completed his Ph.D. in biology. In May 1997, plaintiff applied for and was accepted to a postdoctoral fellowship at the Adirondack Biomedical Research Institution located in the Village of Lake Placid, Essex County. The parties relocated to Lake Placid in the summer of 1997 where defendant maintained the marital home and plaintiff completed his fellowship. In July 1998, they separated and plaintiff relocated to New Jersey to accept a teaching position at Montclair State University, while defendant moved to New York City. The following September, defendant returned to college full time, incurring substantial child care expenses. She anticipated that those expenses would continue while she worked full time in the upcoming summer and upon her hopeful entry into either a Master's or Ph.D. program thereafter.

Concerning equitable distribution, James Abbott, a certified public accountant and certified valuation analyst, testified for defendant regarding the present value of plaintiff's doctoral degree, as well as his postdoctoral fellowship. Abbott testified that an individual with a Ph.D. in biology statistically earns more than one with a Master's degree. For the purposes of calculating the value of plaintiff's degree, Abbott treated the fellowship as an extension of the Ph.D. program and asserted that the fellowship enhanced his earning capacity. After Abbott further detailed the methodology he employed, Supreme Court accepted his expert report into evidence over objection.

Supreme Court, finding sufficient grounds for divorce and resolving issues of custody and visitation, calculated child support under the Child Support Standards Act (see, Domestic Relations Law § 240 [1-b]) (hereinafter CSSA) and made appropriate provisions for medical, dental and eye care expenses not covered by insurance. Concerning the equitable distribution of the parties' marital property, the court found, inter alia, that while plaintiff's Ph.D. degree was marital property within the meaning of Domestic Relations Law § 236 (B) (1) (c), defendant was not entitled to an equitable portion thereof since she had not made any contributions to the attainment of that degree. In so finding, the court rejected Abbott's testimony that the postdoctoral fellowship was an extension of the degree program to which defendant would be entitled an equitable share due to her contribution as "wife, mother, and homemaker" during the fellowship period. With no proffered evidence that the completion of the fellowship was required to teach biology or had, in some manner, enhanced plaintiff's earning capacity by securing the teaching position he now holds, the court rejected Abbott's testimony. Upon appeal, defendant does not challenge Supreme Court's determination that she is not entitled to an equitable portion of plaintiff's Ph.D. degree. Instead, she contends that plaintiff's postdoctoral fellowship enhanced his earning potential and, therefore, should be deemed marital property to which she is due her equitable share.

Domestic Relations Law defines marital property as "all property acquired by either or both spouses during the marriage and before execution of a separation agreement or the commencement of the matrimonial action, regardless of the form in which title is held" (Domestic Relations Law § 236 [B] [1] [c]; see, Domestic Relations Law § 236 [B] [5] [b], [c]). As the Court of Appeals guided, "an interest in a profession or professional career potential is marital property which may be represented by direct or indirect contributions of the non-title-holding spouse, including financial contributions and nonfinancial contributions made by caring for the home and family" (O'Brien v O'Brien, 66 N.Y.2d 576, 584). In assessing value, the courts look to "the enhanced earning capacity it affords its holder" (id., at 586). Hence, in defining the term marital property, the Court of Appeals has urged us to interpret such term "broadly in order to give effect to the 'economic partnership' concept of the marriage relationship recognized in the statute" (Price v Price, 69 N.Y.2d 8, 15 [emphasis in original]).

Applications of these principles have not been limited to instances where the enhanced earning potential of a spouse is linked solely to the attainment of a license and/or degree. Instead, the concept of marital property has been extended to those situations where a spouse's contributions and efforts led to an enhanced earning capacity in a particular career (see, Murtha v Murtha, 264 A.D.2d 552, 553, lv dismissed 95 N.Y.2d 791 [certification as chartered financial analyst found to have enhanced earning capacity although not a prerequisite for employment and/or advancement]; Hougie v Hougie, 261 A.D.2d 161, 162 [enhanced earning capacity as investment banker was subject to equitable distribution whether or not such career required a license]; Mitnick v Rosenthal, 260 A.D.2d 238, 239, lv dismissed 94 N.Y.2d 797, lv denied 95 N.Y.2d 769 [fellowships found to be subject to equitable distribution upon evidence that they enhanced earning capacity]; Elkus v Elkus, 169 A.D.2d 134, 139-140, lv dismissed 79 N.Y.2d 851 [value of career as opera singer and/or celebrity status was enhanced by the defendant...