Source: https://www.divorceny.com/category/maintenance/
Timestamp: 2019-04-18 22:43:13+00:00

Document:
Imposing a higher maintenance obligation on an Orthodox Jewish husband who refused to give his wife a religious divorce (“Get”) would violate constitutional protections. So held Orange County Acting Supreme Court Justice Catherine M. Bartlett in the January 13, 2017 decision in Masri v. Masri.
The parties married in 2002, separated in 2007 and have lived separate and apart since that time. They have 14 and 11 year-old children, the older one being disabled. The wife commenced the present action for a no-fault divorce March 8, 2016.
Two decisions this month of the Appellate Division, Second Department, tied the termination of post-divorce spousal support (“maintenance”) to a specific ages: 65 in Duval v. Duval; and 62 in Sansone v. Sansone.
In Duval, after 20 years of marriage, the wife commenced her action for divorce. The decision reports that “both parties are 56 years old.” During the course of their marriage, the parties had two children, one of whom was emancipated. In 1992, shortly before the birth of their first child, the husband became the sole source of financial support for the family. The wife was a stay-at-home mother prior to the commencement of the action. In approximately 1999, the wife’s father, an insurance agent, retired, and the husband took over his father-in-law’s insurance agency [how important is this fact to the decision?].
The Effect of Spousal Support on Child Support: Did the Second Department Jump the Gun?
Until the amendment of the Child Support Standards Act effective January 24, 2016 (D.R.L. §240[1-b][b][iii][I]; Laws of 2015, c. 387, §3), the rule had been that when a divorce court awards maintenance to a spouse, the amount of annual maintenance is to be deducted from the payor’s income when calculating parental income. However, for those same C.S.S.A. calculations, maintenance was not to be added to the recipient’s income. Thus, for example if in its award, a divorce court awarded a wife (the custodial parent) who had no other income $60,000 per year in maintenance from a husband earning $250,000 per year, the husband’s income for C.S.S.A. purposes would equal $250,000 less FICA, Medicare, and the $60,000 in maintenance, but the wife’s income would still be $0.
The recent amendment changed that anomaly. Effective January 24, 2016 , the alimony or maintenance actually paid or to be paid to a spouse is to be added to the income of the recipient when calculating parental income.
Although it does not expressly so state, it has been held that this amendment is to be applied to cases commenced on or after January 24, 2016, and not to cases commenced before that date. R.I. v. T.I., 2016 NY Slip Op 50664(U), 51 Misc. 3d 1215(A) (Sup. Ct. Kings 2016); C.G. v. F.G., 2016 NY Slip Op 26220, 53 Misc. 3d 229, 235-36, 34 N.Y.S.3d 882, 887-88 (Sup. Ct. Richmond 2016).
Until the amendment, the rule had been that it was error to include maintenance awards as income to the recipient when computing the child support obligation. Krukenkamp v. Krukenkamp, 54 A.D.3d 345 (2nd Dept. 2008); Wallach v. Wallach, 37 A.D.3d 707, (2nd Dept. 2007); Shapiro v. Shapiro, 35 A.D.3d 585 (2nd Dept. 2006); Lee v Lee, 18 A.D.3D 508 (2nd Dept. 2005).
In its November 9, 2016 decision in Castello v. Castello, the Second Department ruled differently. In that case, the court modified a 2013 divorce judgment by changing the child support calculation.
In its August 24, 2016 decision in Maddaloni v. Maddaloni, the Appellate Division, Second Department, upheld the rulings of Supreme Court Suffolk County Justice Justice Carol Mackenzie that invalidated the all-but-complete maintenance waiver contained in a 23-year-old postnuptial agreement, awarding the wife maintenance for 10 years. The appellate court also upheld Justice Mackenzie’s award to the wife of 25% of the $2,000,000 appreciation during the marriage in the value of the husband’s pre-marital business, Maddaloni Jewelers of Huntington.
What’s the Court's Dollar Value for a Religious Divorce (“Get”)?
To appreciate the scope of the problem, note, for example, that in December, 2015 70-year old Rabbi Mendel Epstein of Brooklyn (pictured), dubbed “The Prodfather,” was sentenced to 10 years in jail after he was convicted of charging wives thousands of dollars to torture their husbands into delivering a get. See, NY Daily News.
In 1983, New York enacted Domestic Relations Law §253 to address husbands who withhold the get. That section, in combination with DRL §236(B)(5)(h), and DRL §236(B)(6)(d) empowers a court to direct specific performance of a Ketubah (the marriage contract) or other agreement by which a husband previously agreed to provide a get to his wife. Civil contempt sanctions are available for non-compliance. Additionally, for withholding a get, the court may deny a husband any right to equitable distribution of the marital estate and/or award the wife maintenance at a level designed to encourage compliance. If the husband is the plaintiff, the court may also deny him a civil divorce.
In its April 13, 2016 decision in Mizrahi-Srour v. Srour, the Appellate Division, Second Department, affirmed Kings County Supreme Court Justice Esther M. Morgenstern‘s award to the wife of maintenance of $100 per week for five years, which would be increased to $200 per week if the husband did not provide a get to the wife within 60 days, and also distributed to the wife 70% of the marital assets, and awarded counsel fees.
A business, professional practice, or (until recent statutory amendments) license may be valued as a asset for divorce purposes based upon the amount of income it generates for the owner/holder. That asset may then be equitably distributed by granting the non-owner a monetary award equal to some percentage of the value.
Double-dipping, or double-counting, is the term for using the same stream of income both to value the business/practice, and then, after distributing an award to the non-owner based on the asset’s value, using the stream of income generated by the business/practice to base an award of spousal support (or child support, for that matter). If the non-owner spouse receives a “piece” of the income stream as an asset award, should the spouse get another piece as spousal support (maintenance)?
The “law” is yes, no and maybe. There is a rule against double-dipping, except when there’s not.
For the most part, if the business/practice is recognized as a “tangible asset,” just as the court would characterize a piece of real property, or publicly-traded stock, or a privately-held company whose income is a result of the work of many people, then it is generally held that the rule against double-dipping does not apply. The non-owner would get a distributive award based on the asset. Maintenance may also be awarded based upon the income generated by the tangible asset business. The rule against double-dipping rule does not apply.
If however, the business value is recognized as an “intangible asset,” then the rule against double-dipping applies, and the same stream of income may not be twice used.
For the second time in six weeks the Appellate Division, Third Department, reduced an award of spousal maintenance for the failure to adjust for the distributive award based on the husband’s business. In its October 22, 2015 decision in Gifford v. Gifford, the Appellate Division, Third Department, modified a maintenance award because of the trial court’s failure to adjust the husband’s income for computation purposes to account for the distributive award to the wife based on the husband’s business. In September, in Mula v. Mula, the Third Department held that once valued, the income attributable to ownership of a professional practice may not also be the basis on which to award spousal maintenance (see, the September 14, 2015 blog post).
In Gifford, the parties in this divorce had stipulated a resolution of Equitable Distribution issues, including a $210,000 award to the wife based on the value of the husband’s geotechnical engineer business. After a trial on maintenance on counsel fees, Supreme Court Justice Vincent J. Reilly awarded the wife nondurational maintenance of $6,000 per month from January 1, 2014 through January 31, 2020, $3,000 per month from February 1, 2020 through June 1, 2022, and $800 per month thereafter, terminating upon either party’s death or the wife’s remarriage.
The Third Department held that Justice Reilley erred in utilizing the husband’s total average annual income of $332,431 for purposes of calculating a maintenance award, without making an adjustment for the distributive award of the company.
The award of maintenance to the divorcing unemployed or under-employed spouse in his or her 50s may be one of the more challenging exercises of a judge’s discretion in a divorce action: too old to develop a lucrative career; too young to collect retirement assets built up over a lengthy marriage.
A professional practice is an asset which may be valued and equitably distributed in a divorce. Generally, that value is a function of the income generated by the practice after deducting reasonable compensation being paid to the professional. However, once valued, the income attributable to ownership of the practice may not also be the basis on which to award spousal maintenance.
Take the September 10, 2015 decision of the Appellate Division, Third Department, in Mula v. Mula. There, after 42 years of marriage, the husband commenced this action for a divorce. The wife counterclaimed for divorce and, by agreement, the parties were awarded mutual divorces on the grounds of irretrievable breakdown. During the marriage, the husband earned his C.P.A. license in 1981 and became the sole proprietor of an accounting practice in 1997. During the course of the marriage, the wife was primarily involved with the upkeep of the parties’ home and raising their three children.
Among other rulings, Ulster County Supreme Court Justice Anthony McGinty awarded the wife durational maintenance of $1,500 per month.
On appeal, the Third Department reduced this award to $1,000 per month, holding that Justice McGinty had double-counted the value of the husband’s professional practice. The lower court had valued the income generated by the practice as an asset and equitably distributed that asst. However, Justice McGinty also deemed the husband’s income to include the entire income generated by the practice when calculating the maintenance award to the wife.
The accounting practice was valued at $255,000. Apparently, the husband’s C.P.A. license was separately valued at $39,000.The husband contended on appeal that Justice McGinty had erred when calculating maintenance by failing to reduce his available income to reflect the court’s distributive award of his professional practice and license.
At issue is the rule against double counting, which provides that once a court converts a specific stream of income into an asset, that income may no longer be calculated into the maintenance formula and payout.
The husband’s solely-owned accounting firm was a service business for purposes of this rule.

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