Woytas v. Greenwood Tree Experts, Inc., A-31 September Term 2018

Citation206 A.3d 386,237 N.J. 501
Decision Date06 May 2019
Docket NumberA-31 September Term 2018,081720
Parties Sandra WOYTAS, Administratrix of the Estate of Timothy G. Woytas, deceased; and Sandra Woytas, individually, Plaintiff-Appellant, v. GREENWOOD TREE EXPERTS, INC., Greenwood Lawn Services, Inc., Greenwood Continuity Trust, John R. Woytas, III, Raymond J. Woytas, David W. Dubee, Robert W. Dubee, Whippany Fire Department (a/k/a Township of Hanover Fire District #2) and Lincoln National Life Insurance Company, Defendants, and Christina Woytas, individually and as guardian for T.M. Woytas, C.T. Woytas and J.T. Woytas, Defendant-Respondent.
CourtUnited States State Supreme Court (New Jersey)

237 N.J. 501
206 A.3d 386

Sandra WOYTAS, Administratrix of the Estate of Timothy G. Woytas, deceased; and Sandra Woytas, individually, Plaintiff-Appellant,
v.
GREENWOOD TREE EXPERTS, INC., Greenwood Lawn Services, Inc., Greenwood Continuity Trust, John R. Woytas, III, Raymond J. Woytas, David W. Dubee, Robert W. Dubee, Whippany Fire Department (a/k/a Township of Hanover Fire District #2) and Lincoln National Life Insurance Company, Defendants,
and
Christina Woytas, individually and as guardian for T.M. Woytas, C.T. Woytas and J.T. Woytas, Defendant-Respondent.

A-31 September Term 2018
081720

Supreme Court of New Jersey.

Argued March 25, 2019
Decided May 6, 2019


Matheu D. Nunn, Denville, argued the cause for appellant (Einhorn, Harris, Ascher, Barbarito & Frost, attorneys; Matheu D. Nunn, of counsel and on the briefs, and Bonnie C. Frost and Gary R. Botwinick, on the briefs).

Lauren F. Iannaccone, Roseland, argued the cause for respondent (Connell Foley, attorneys; Lauren F. Iannaccone, on the brief, and Andrew C. Sayles, of counsel and on the brief).

JUSTICE SOLOMON delivered the opinion of the Court.

237 N.J. 505

Christina Woytas and Timothy G. Woytas were married for seventeen years and had three children. The couple divorced after entering into a Marital Settlement Agreement that required Timothy to pay both alimony and child support. To secure Timothy's child support and alimony obligations, the Agreement required that he "maintain" life insurance policies naming Christina and their three children as beneficiaries.

The life insurance policies Timothy purchased included a "suicide exclusion" barring recovery of benefits if the insured were to commit suicide within two years of purchase. Timothy committed suicide within two years of acquiring the policies. As a result, the insurance companies did not pay the face value of the life insurance policies, instead offering a return of premiums plus interest.

In this appeal, we first consider whether Timothy breached the Marital Settlement Agreement by committing suicide within two years of purchasing the life insurance policies. Second, we are asked to determine to whom the limited funds in Timothy's estate should be distributed and in what amounts.

We agree with the Chancery Division and the Appellate Division that the Marital Settlement Agreement required Timothy to "maintain" life insurance to support the children in the event of Timothy's death. Because Timothy's suicide barred recovery of the life insurance proceeds, we find that he failed to "maintain" life insurance and therefore breached the Agreement.

As to the distribution of Timothy's estate, we concur with the Chancery Division that a precise calculation of Timothy's outstanding child support obligations would be speculative. We also determine that, in light of Timothy's substantial child support obligations, the Chancery Division did not abuse its discretion by finding that Timothy's outstanding obligations exceed the remaining assets of Timothy's estate. Thus, there would be no remaining estate assets to pay Sandra's claims, and a remand for a precise damages calculation is unnecessary.

206 A.3d 389
237 N.J. 506

I.

A.

The record of the trial court reveals that Timothy and Christina were married for more than seventeen years and had three children from the marriage. Timothy and Christina entered into a Marital Settlement Agreement (MSA) and divorced. The MSA required Timothy to provide $1551 per month to Christina for support of their three children, and to pay $5000 per month of alimony to Christina for twelve years.

The MSA also required that Timothy maintain medical insurance for the children; pay sixty-five percent of the children's unreimbursed and non-reimbursable medical, dental, prescription drug, psychiatric, psychotherapy, psychological, eye care, and orthodontic expenses; pay sixty-five percent of any mutually agreed upon extracurricular activities; pay fifty percent of the children's cell-phone expenses; and, if practicable, contribute to the children's undergraduate college, junior college, or vocational or trade school education, including application fees, preadmission standardized test costs, tuition, room and board, activity fees, lab fees, books, supplies, and transportation.

In order to secure those obligations, the MSA required Timothy to maintain life insurance policies naming Christina and the three children as beneficiaries. Specifically, the MSA obligated Timothy to maintain a $400,000 life insurance policy for the duration of his alimony obligation, naming Christina as the beneficiary. If Timothy remained current with his alimony obligation, the MSA permitted him to reduce the policy by $30,000 each year, provided the value of the policy did not fall below $250,000. Timothy was likewise required to maintain a $750,000 life insurance policy for the benefit of the children, as co-equal beneficiaries, to be reduced by $250,000 upon a child's emancipation.

Pertinent to this appeal, Timothy and Christina handwrote a clause into the MSA, providing that "[i]n the event either party fails to maintain the life insurance [policy requirements], such

237 N.J. 507

party's estate shall be liable for any outstanding obligations owed under this Agreement."

Timothy procured a $100,000 life insurance policy naming Christina as the beneficiary, supplementing a separate $300,000 policy Timothy purchased during their marriage, naming Christina as the beneficiary. Additionally, Timothy obtained a $750,000 life insurance policy naming the three children as beneficiaries. Both policies contained a "suicide exclusion" which provided that if the primary insured -- Timothy -- should commit suicide within two years of the effective date of the policy, the death benefit would equal only the premiums paid plus interest.

A little over four months after his divorce from Christina, Timothy married Sandra. Because Sandra's former husband's alimony payments terminated upon her second marriage, Timothy obtained a $500,000 life insurance policy naming Sandra as the beneficiary.

Less than two years after his divorce from Christina, Timothy committed suicide, intestate, and Sandra was appointed administratrix of his estate. At the time of Timothy's death, the children were ages sixteen, fourteen, and eleven. Christina recovered $300,000 from the life insurance policy procured by Timothy before the divorce. However, because of the "suicide exclusion," her claims under the policies purchased pursuant to the MSA were denied. Instead, Christina received a return of the premiums paid on each policy, plus interest, totaling $1600.85. Owing to a similar suicide exclusion, Sandra was also unable

206 A.3d 390

to recover from the $500,000 life insurance policy purchased for her benefit.

B.

Christina filed claims against Timothy's estate on her own behalf and on behalf of the three children. She asserted that, because the insurance company denied her claims, she was entitled

237 N.J. 508

to $100,0001 and the children were entitled to $750,000 from the estate pursuant to the MSA. Sandra likewise filed a claim against Timothy's estate for $500,000 -- the value of the life insurance policy naming her as beneficiary.2

C.

Sandra, as administratrix of Timothy's estate and in her personal capacity, filed a verified complaint in the Chancery Division. By her complaint, Sandra made claims against Christina.3

Christina and her eldest child, Taylor Woytas, on behalf of themselves and the two minor children (collectively, moving defendants), filed a counterclaim against Timothy's estate. Moving defendants claimed that Timothy breached the MSA by committing suicide and that they are entitled to payment from the estate for the unrecoverable proceeds of Timothy's life insurance policies. The claims against the estate totaled over $1,400,000. However, at the time of his death, Timothy's assets, less estate expenses, totaled only $446,966.47.4

Moving defendants filed for summary judgment, asking the Chancery Division to declare that Timothy breached the MSA by committing suicide, and that their claims for unpaid child support and alimony have priority over all other claims asserted against

237 N.J. 509

the estate. Sandra, individually and on behalf of the estate, opposed the motion.5

Finding no controlling New Jersey case law, the Chancery judge, citing Tintocalis v. Tintocalis, 20 Cal.App.4th 1590, 25 Cal.Rptr.2d 655 (1993), concluded that Timothy breached the MSA by failing to maintain life insurance for the benefit of Christina and the children. Relying upon the handwritten passage in the MSA -- that if either party fails to maintain life insurance, the party's estate would be liable for any outstanding obligations owed under the agreement -- the judge found that moving defendants were entitled to damages from the estate. The court also declared that the children's claims had first priority over all other...

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1 books & journal articles
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