Edward R. Weinstein, Esq.Edward R. Weinstein, Esq.

May A N.J. Divorce Court Re-Open My Divorce If Our Home Was Not Addressed?

            Yes.  If an asset of the marriage is not addressed in your Final (or Dual) Judgment of Divorce in New Jersey, even if your lawyer failed to disclose the asset, a New Jersey Family Court may, upon determining whether this would be fair, ruled that a divorce may be re-opened due to this significant and material mistake.  As our law firm strives to provide the public with an analysis of recent New Jersey divorce cases, please find this attorney’s take on this issue.   

In Puerta v. Puerta, the Honorable Judge Jones of the Superior Court of New Jersey, Family Part of Ocean County, reviewed the issue of whether a divorced party can file a post-judgment motion for equitable distribution of marital property after the divorce judgment has already been entered. Judge Jones found that generally, the entire controversy doctrine requires a litigant to state all claims against an adverse party in the same case. This is to prevent several hearings when one hearing can serve to resolve the dispute. However, this rule is not without exception, especially when balanced against other important principle and policies of equity. Moreover, under Rule 4:50-1(f) and Rule 1:1-2, a Family Part court has the discretion, in an effort to prevent significant injustice, to re-open divorce cases to review issues of equitable distribution that were not brought up or waived within a matrimonial settlement agreement,  or brought up by either litigant in an official “Notice of Final Judgment” under Rule 5:5-10.

            Flor and Diego Puerta got married in 1986, and had two children together. They separated in 2012 after living together for 24 years. The couple lived in New Jersey for most of their marriage, but also lived in North Carolina for some as well. They jointly bought a house in North Carolina for about $ 40,000 in 2007. The property was paid for with marital funds, that were acquired by selling a small piece of farmland that they owned in Columbia, South America. When they bought the property, only Diego’s name was placed on the deed, but both Diego and Flor’s name were on the mortgage. In 2011, the land was subdivided and sold. The general warranty deed explicitly listed both Flor and Diego as co-grantors of the land.

            Flor filed a complaint for divorce in 2014, and alleged that the former couple had orally agreed to sell the house and divide the proceeds equally. On March 10, 2014, Flor went to court and obtained an uncontested final judgment of divorce, but had not filed a Notice of Final Judgment as per Rule 5:5-10. She also failed to seek an equitable distribution judgment for the house or any other asset of the marriage. As such, while the marriage was terminated, no formal equitable distribution of the marital property was conducted by the court, as neither party to the divorce ever made a formal claim for the same.

            Then, almost a year and a half later, Flor filed the post-judgment motion at issue here. She claimed that even though Diego had verbally agreed to sell the house, he delayed the sale and then refused to sell after the judgment of divorce was entered. Flor also alleged that at the time of the divorce, she did not understand that she needed to put their oral agreement into a written settlement agreement, or judgment for equitable distribution. As such, she wanted a court order to re-open the divorce case so that the court could address the issue of equitable distribution of the parties house, order its sale, and require the proceeds from sale to divided equally between both parties.

Diego objected and argued that because the divorce was over, the Family Part should not consider his ex-wife’s claim for equitable distribution. He further argued that the property belonged to him alone, because the title was in his name. Interestingly, he did not deny that the former couple had an oral agreement to the sell the house and divide the proceeds from sale equally. Rather, he argued that because Flor never formally requested a judgment of equitable distribution during the divorce process, she had lost her right to share in the value of the property which was titled in Diego’s name alone.

            In the 1973 New Jersey Supreme Court case of Sibilia v. Sibilia, the Court instituted a narrow interpretation of the equitable distribution law, New Jersey Statute 2A:34-23.1, and came to the conclusion that a claim for equitable distribution must be made before the divorce judgment is entered.  While this case was based on the 1971 version of the equitable distribution statute, the 2016 version, which had been modified and amended, still contained the “is entered” language.

            Judge Jones, however, reasoned that the Sibilia opinion was now more than forty years old. The case did not state the specific factual circumstance that predicated the ruling, including why the plaintiff had not requested equitable distribution at the time of divorce. More importantly, the Sibilia case did not account for equitable factors and principles of fairness that existed in Puerta, that were important enough to deserve consideration. These additional factors included: (1) the flexibility of the entire controversy doctrine under Rule 4:30A; (2) the application of Rule 1:1-2 and Rule 4:50-1(f) to affect fairness and equity; (3) the public policy of avoiding the unjust enrichment of any party in a court of equity; (4) the social significance of equitable distribution.

            The core of the issue in Puerta v. Puerta, was the entire controversy doctrine. The entire controversy doctrine comes from Rule 4:30A, and requires litigants to state all transactionally related claims in the same case. This doctrine, however, is not so inflexible or rigid as to prohibit the re-opening of every single case, regardless of the specific circumstances that may be present. The application of of the entire controversy doctrine is based on judicial fairness. Furthermore, Rule 1:1-2 states that any rule can be relaxed or even dispensed with by a court if its application would result in injustice. Moreover, Rule 4:50-1(f) allows for a court to to relieve a litigant from a final judgment in the interest of justice. Accordingly, a Family Part has the discretion to relax rules from time to time, and even avoid previously entered judgments of divorce in the interest to maintain equity and avoid injustice.

            The authority to right wrongs necessitates remedy. Courts of equity will not suffer an injustice without implementing a remedy. In Puerta, the Family Part of Ocean County found that the specific equities of the case weighed in favor of re-opening the divorce action in order  to resolve the previously unaddressed issue of equitable distribution of the former couple’s marital property. In consideration of the the statutory factors enumerated in New Jersey Statute 2A:34-23.1, the equitable distribution statute, and the specific facts of the case, Judge Jones found that it was fair and equitable for both parties to share in the equitable distribution of the real estate property, equally, on a fifty-fifty basis. It is important to note that a fifty-fifty split of real property is not a mandatory requirement, but a careful analysis of all of the statutory factors supported an order awarding an equal split and distribution of the assets between the parties, in this specific case.

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