Equitable Distribution Of Home Is Open For Argument After Ambiguous PSA
- December 17, 2014
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In the recent Appellate Division case, Paintsil v. Oppong-manu, a post-judgment matrimonial case, the Defendant ex-husband appealed from a 2012 Family Court Order which enforced a property settlement agreement (PSA) with regard to the Plaintiff ex-wife’s right to receive $22,672.50 as a share of the equitable distribution of their former marital home because he argued the provisions of their PSA were ambiguous and open to multiple interpretations. The parties in this case were marred in 1991 and obtained a divorce in 2008. They had two (2) children born in 1993 and 1997 respectively. On the date that their judgment of divorce was issued they entered into a PSA which designated the Defendant as the parent of primary residence and upon which the Defendant waived child support in exchange for the Plaintiff’s waiver of alimony. Further, a provision of the PSA specifically directed that both parties are entitled to 50% of the equity of the marital residence and the “Husband agrees to [buy out] Wife’s portion of the residence” if this was not possible then the house was to be sold and the proceeds to be split evenly. Specifically, the parties agreed that the fair market value of the marital home was $435,000 with a principal mortgage of $339,655 and an equity line of credit of $80,000. Therefore, at the time the equity in the home totaled $15,345 and subsequently the Plaintiff was entitled to $7,672.50. From the $80,000 home equity line of credit the parties used $30,000 on improvements and the Plaintiff received $10,000 which resulted in $40,000 that remained. According to the PSA, the Plaintiff was entitled to 50% less the $10,000 advance that she received and should have received another $15,000 additionally from the home equity line of credit. In total, the Plaintiff then was entitled to $22,672.50 from the marital home. In 2012, the Plaintiff filed a Motion to enforce litigant’s rights to force the Defendant to pay her the money she was owed under the PSA. The Defendant argued that he could not refinance the home and the value of the home had dropped significantly since the divorce and that the PSA contemplated such an event allowing for modifications to the payouts. The judge found the Defendant was in violation of litigant’s rights and ordered him to pay the Plaintiff $22,672.50 plus interest within thirty (30) days of the Order without holding a plenary hearing to evaluate the language of the PSA. The Defendant appealed. According to the Appellate Court, “[I]t is a basic rule of contractual interpretation that a court must discern and implement the common intention of the parties.: Pacifico v. Pacifico, 190 N.J. 258, 266 (2007). If the meaning of a contract such as a PSA is in dispute the court role is to consider “what is written in the context of the circumstances at the time of drafting and to apply a rational meaning in keeping with the ‘expressed general purpose’.” Atl. N. Airlines, Inc. v. Schwimmer, 12 N.J. 293, 302 (1953). In applying these principals the Appellate Division found that the trial court mistakenly exercised its discretion by finding that the Plaintiff was entitled to the enforcement of the PSA because more than one reasonable interpretation of the provisions was presented to the court, requiring a further plenary hearing that did not occur. Therefore, the court reversed and remanded the case back for further findings. The equitable distribution of assets is of the most emotional and complex aspects of a divorce. If you are involved in a battle over the division of marital property, assets, or debts it is extremely important that you seek out the advice of an experienced attorney before moving forward. For more information about equitable distribution, post-judgment modification, contested divorce, spousal support, or other family law matters in New Jersey visit HeatherDarlingLawyer.com. This blog is for informational purposes and in no way intended to replace the advice of an attorney.