Court Opinion

ID: 6030266
Source: CourtListenerOpinion
Date Created: 2022-01-13 12:46:22.231711+00
Date Added: 2024-06-11T08:51:13.747842
License: Public Domain

Sullivan, J. P.,
dissents in part in a Memorandum as follows: I disagree with the majority’s conclusion that the IAS Court correctly attributed only 25% of the appreciation of the husband’s separate property, i.e., his investment accounts, to the marital estate. After determining, as a factual matter, that the husband’s efforts and actions during the years of the marriage affected the fluctuation in value of his investments, the entire resultant appreciation should have been attributed to *106the marital estate. Since the trial court concluded, and the majority does not disagree, that the wife was an equal partner in the marriage and entitled to one-half of the marital estate, she should receive her full 50% share of that appreciation.
It is well settled that the appreciation in value of separate property resulting from the contributions, either direct or indirect, of either or both spouses is marital property. (See, e.g., Price v Price, 69 NY2d 8; Rando-Quillin v Quillin, 195 AD2d 636; Greenwald v Greenwald, 164 AD2d 706, lv denied 78 NY2d 855.) In Price, the Court held that the determination of whether the appreciation of separate property constitutes marital property depends primarily upon the nature of the asset and whether the appreciation was due in “some measure” to the time and effort of the titled spouse. (69 NY2d, supra, at 18.) The Court of Appeals reaffirmed this principle in Hartog v Hartog (85 NY2d 36).
After extensive testimony, the trial court concluded, quite properly, that the husband’s intense, “macro” management of his investments and his decisions throughout the marriage affected the value of his investment accounts. This management included the monthly, ritualistic review of his account statements and bookkeeping entries reflecting gains and losses as well as his calculation of the value of his investments in “hedge” funds. He routinely performed comparative analysis to track the growth of his assets, thereby enabling him to make numerous investment allocation decisions. His decisions were based on his conversations with others and market information learned in the course of his job as a specialist on the floor of the New York Stock Exchange, his operation of a wholly owned securities tracking corporation and his daily reading of the Wall Street Journal. The husband’s activity is reflected not only by the decisions he made but as well by the investment choices he avoided. And, even though the husband acted through an advisor, the evidence discloses that the investment decisions were the product of his labors and not mere random fluctuations. In any event, “it is of no significance that the financial decisions [are] made exclusively by the titled spouse’s financial advisor” (Greenwald v Greenwald, 164 AD2d 706, 718, supra) in determining whether the appreciation in the husband’s investment accounts was the result of his active contribution.
Thus, while the trial court properly determined that the husband’s activities affected the fluctuation in value of his separate property, it arbitrarily decided that his active involvement in the management of his investment accounts was *107responsible for only 25% of the appreciation earned during the marriage. Nothing in the record supports such a result, which appears to be based on a misreading of Hartog (supra), where the husband’s active involvement in the appreciation of separate property, i.e., several family owned businesses, was limited to a participation in which he acted with respect to certain matters involving those businesses, as part of a consortium with other board members or corporate officers. In essence, unlike here, the active involvement that brought about the appreciation was not his alone.
Having correctly found the husband’s involvement in the management of bis investment accounts to be active, the trial court was obliged to include in the marital estate the entirety of the appreciation of those accounts during the marriage.
Accordingly, I would modify the wife’s distributive award to include 50% of the appreciation of the husband’s investment accounts during the marriage.