Ferrante v. Ferrante

186 A.D.3d 566

128 N.Y.S.3d 590

Silvana FERRANTE, Respondent,

v.Joseph FERRANTE, Appellant.

2017–00275

Index No. 5820/12

Supreme Court, Appellate Division, Second Department, New York.

Argued—October 3, 2019

August 12, 2020

Quatela Chimeri, PLLC, Hauppauge, N.Y. (Christopher J. Chimeri and Sophia Arzoumanidis of counsel), for appellant.

Castrovinci & Mady, Smithtown, N.Y. (Philip J. Castrovinci and Debora Shamoilia of counsel), for respondent.

REINALDO E. RIVERA, J.P., RUTH C. BALKIN, SHERI S. ROMAN, BETSY BARROS, JJ.

DECISION & ORDER

In an action for a divorce and ancillary relief, the defendant appeals from a judgment of divorce of the Supreme Court, Suffolk County (Carol B. MacKenzie, J.), dated December 14, 2016. The judgment of divorce, insofar as appealed from, upon a decision of the same court dated September 15, 2016, made after a nonjury trial, (1) directed the defendant to pay to the plaintiff the sum of $508,918.30, representing a share of funds paid to the defendant's mother on certain promissory notes, (2) awarded the plaintiff the sums of $14,195 and $51,000, representing a share of the defendant's interest in two businesses, (3) failed to award the defendant a separate property credit on the marital residence, (4) directed that the defendant pay to the plaintiff the sum of $27,500, representing funds that he withdrew from the parties' home equity line of credit account, and (5) awarded the plaintiff maintenance in the sum of $5,000 per month until she reaches the age of 66 years.

ORDERED that the judgment of divorce is modified, on the law, by (1) deleting the provision thereof directing the defendant to pay to the plaintiff the sum of $508,918.30, and (2) adding a provision thereto stating that the defendant's obligation to pay maintenance shall terminate upon the death of either party or upon the plaintiff's remarriage; as so modified, the judgment of divorce is affirmed insofar as appealed from, without costs or disbursements.

The parties were married on September 25, 1993, and the plaintiff commenced this action for a divorce and ancillary relief on March 16, 2012. During the marriage, the defendant was associated with three businesses—Unique Sanitation (hereinafter Unique), U–Need–A–Roll Off (hereinafter Roll), and Paragon Recycling (hereinafter Paragon)—all founded by his father. The defendant owned shares in Unique and Paragon and the defendant's brother owned shares in Roll and Paragon. In 2004 and 2007, the defendant's parents created two trusts, into which they placed the remaining shares of Unique and Roll, which they owned, and named the defendant and his brother as beneficiaries. The defendant's father served as the trustee. In 2004, when the trust was first created, the trustee executed a promissory note promising to pay the defendant's mother a certain sum. The trustee executed a second promissory note in favor of the defendant's mother in 2010. Monthly payments were made on the notes from the income from the businesses.

A nonjury trial was held on the issues of maintenance and equitable distribution of the marital property. The Supreme Court rendered a judgment, upon a decision after trial, which, inter alia, directed the defendant to pay to the plaintiff the sum of $508,918.30, representing 50% of the payments made on the promissory notes, and awarded the plaintiff the sums of $14,195 and $51,000, representing a share of the defendant's interests in Unique and Paragon, respectively. The court also declined to award the defendant a separate property credit on the marital residence and directed that the defendant pay to the plaintiff the sum of $27,500, representing funds that he withdrew from the parties' home equity line of credit account. Finally, the court awarded the plaintiff maintenance in the sum of $5,000 per month until she reaches the age of 66 years. The defendant appeals.

Contrary to the Supreme Court's determination, the plaintiff was not entitled to equitable distribution of funds used to pay the promissory notes to the defendant's mother. The plaintiff did not demonstrate that the notes were paid with marital funds (cf. Iarocci v. Iarocci , 98 A.D.3d 999, 951 N.Y.S.2d 176 ; Micha v. Micha , 213 A.D.2d 956, 624 N.Y.S.2d 465 ). Moreover, she failed to demonstrate that payment of the notes constituted wasteful dissipation of marital assets (see Spera v. Spera , 71 A.D.3d 661, 664, 898 N.Y.S.2d 548 ). Contrary to the plaintiff's contention, there was no evidence that the defendant's income from the businesses decreased in light of the payments or that his income from the businesses would have increased had the payments not been made. Accordingly, the defendant should not have been directed to pay to the plaintiff the sum of $508,918.30.

However, the Supreme Court providently exercised its discretion in awarding the plaintiff a share of the defendant's interests in Unique and Paragon. "Property acquired during the marriage is presumed to be marital property and the party seeking to overcome such presumption has the burden of proving that the property in dispute is separate property" ( Massimi v. Massimi , 35 A.D.3d 400, 402, 825 N.Y.S.2d 262 [internal quotation marks omitted]; see Fields v. Fields , 15 N.Y.3d 158, 163, 905 N.Y.S.2d 783, 931 N.E.2d 1039 ). Here, the defendant's self-serving testimony, without more, that the shares of Unique and Paragon that he acquired during the marriage were gifts was insufficient to overcome the marital property presumption (see Bernard v. Bernard , 126 A.D.3d 658, 659, 5 N.Y.S.3d 233 ).

"[W]here one spouse contributed monies derived from separate property toward the acquisition of the marital residence," he or she generally will receive "a credit for that contribution" ( Fields v. Fields , 15 N.Y.3d at 166, 905 N.Y.S.2d 783, 931 N.E.2d 1039 ). "The contributing spouse does not meet the burden of establishing the value of a separate property contribution if he or she offers only his or her own testimony in support of the claim or he or she does not trace the source of the alleged separate property" ( Shkreli v. Shkreli , 142 A.D.3d 546, 548, 36 N.Y.S.3d 208 ). Here, since the defendant only offered his own testimony in support of his claim of a separate property contribution to the marital residence and did not trace the source of the funds, the Supreme Court properly declined to credit him for his alleged separate property contribution (see Horn v. Horn , 145 A.D.3d 666, 667, 43 N.Y.S.3d 395 ; Shkreli v. Shkreli , 142 A.D.3d at 548, 36 N.Y.S.3d 208 ).

We agree with the Supreme Court's determination directing the defendant to pay to the plaintiff the sum of $27,500, as he withdrew that amount from the parties' home equity line of credit account after the commencement of the action in order to satisfy his obligation to pay the plaintiff's counsel fees...