Superior Court of Connecticut, Judicial District of Stamford-Norwalk, Stamford
MEMORANDUM OF DECISION
Michael E. Shay, J.
The plaintiff wife (" wife"), whose birth name was Malia Ramsteck, and the defendant husband (" husband") were married in Ridgefield, Connecticut, on October 9, 1999. They are the parents of three children: Samuel, age 15; James, age 13; and Grace, age 11. The children currently reside primarily with the wife in the marital residence at 147 Woodland Road, New Canaan, Connecticut. The parties have lived separate and apart from about October 12, 2010, and the husband currently occupies a rental at 283 North Maple Avenue, Greenwich, Connecticut. They entered into a Pendente Lite Parenting Plan (#113.00) by stipulation dated March 21, 2011, and each has asked the court to modify the plan in one or more ways.
The husband is 45 years old and described his health as " fair." He received a bachelor's degree in Government and History from Dartmouth College. Thereafter, he held a series of positions in the banking and securities industry from securities analyst to Senior Portfolio Manager. Beginning in 1996, he developed a long-standing professional relationship with Barry Sternlicht, who eventually asked him to " run his fund." From October 2004 until his recent termination in 2015, he had been employed by Starwood Real Estate Securities, LLC as CEO, where he was highly compensated. There he received a base salary of $250, 000.00 per year, together with an incentive bonus and profits participation. The husband signed a Separation Agreement and Release (Exhibit #111) dated April 20, 2015, which sets forth the terms of his termination.
The wife is 45 years old and described her health as " good." She also has a bachelor's degree in English from the University of Connecticut, and a law degree from St. John's University. At the time of the marriage she was employed as an Estate Planning Associate at PricewaterhouseCoopers. Prior to that, she had worked as attorney for Children's Services for the City of New York. For the most part, she has been a homemaker and the principal caregiver for the minor children. More recently, she has served as a Substitute Teacher in the New Canaan Public School System, and as of the 2013-2014 school year, she has taken a position as a Teacher Assistant there and where she earns $31, 152.00 per year. She is paid on a 10-month basis. She is also eligible for medical insurance through her employer.
The husband contends that the wife has a higher earning capacity, and to that end he hired Edwin S. Mruk as an expert. He testified that the wife could earn between $75, 000.00 and $100, 000.00 as a paralegal. (Exhibit #73.) The court has given little weight to his testimony in that he, for the most part, simply viewed websites and news articles as the sources for his data. The court believes that in the long run, the wife's employment prospects are good given her age and educational background. However, the court took note of the fact that she was out of the work force for more than a decade, and that her parenting responsibilities will impact the prospects in the short run. Moreover, she told the court that she finds her current position " very rewarding, " and she has no plans to return to the law.
At the time of the marriage, the husband testified that he owned a condominium in New York City with a net value of $178, 000.00, and an investment account valued at approximately $120, 000.00. (Exhibits #65 and #66.) He told the court that the wife brought nothing to the marriage. Later, the condominium was sold and the proceeds rolled into a prior home in New Canaan. Currently, the principal marital asset is the family home at 147 Woodland Road, New Canaan, which was purchased in both names on July 27, 2006. The purchase price was $2, 380, 000.00, and in addition to monies from their joint checking account and a loan from the husband's father and brother in the amount of $100, 000.00 each (Exhibit #70), the parties took out a mortgage in the amount of $1, 666, 000.00. (Exhibit #19.) According to their respective financial affidavits, each party reports that the property has a fair market value of $2, 000, 000.00. At present, there is a first mortgage in the amount of approximately $1, 507, 000.00, as well as a HELOC with a balance of $181, 000.00, leaving a remaining equity of $312, 000.00.
The wife spent considerable time and resources in order to determine the value of the husband's interest in an aggregate of entities known as Starwood Real Estate Securities, LLC (" Starwood"), in part due to a mistaken belief that the husband held a 50% ownership interest therein, instead of his actual ownership interest which amounted to .1%, for which he contributed $2, 403.46. (Exhibits #32, #41, and #42.) In his original disclosure, the husband had indicated that he held the higher ownership percentage, however, as the case progressed, the evidence became clear as early as May 17, 2012, that, in fact, it was only 0.1%. (Exhibits #51, #64, and #81.) He did, however, have a 50% profits participation interest, which was the likely source of the confusion. Also, it was learned that Starwood Capital Group Management had advanced approximately $2, 500, 000.00 (" Sternlicht Loan") to the Starwood Real Estate Securities, LLC (Exhibits #33, #34, and #52) as and for start-up expenses, repayment of which sums were deducted in part from the husband's share of profits for the years 2011 through 2014.
Nevertheless, the wife, convinced that the husband had acted wrongfully in order to hide marital assets, instead of the honest mistake that it actually was, persisted in a fruitless two-year quest and quite literally opened a veritable " hornet's nest" by involving the husband's employer and other employees of Starwood in this matter. Quite naturally, that entity perceived this as an attempt to unlock its secrets and shifted immediately to the defense, as it fought vigorously to protect what it referred to as its " proprietary interests." As a direct result, as far as the Gilmans were concerned, this proved counterproductive and was the cause of the considerable delay in bringing the matter to trial and added to the cost of the matrimonial litigation. Ultimately, according to an affidavit filed by the husband on January 15, 2015 (#406.00), the legal fees and expenses incurred by the third party in defending itself, amounted to $740, 554.00, which were summarily deducted from the monies owed to the husband by Starwood and ultimately diminished the marital estate.
Each party engaged an expert to conduct the valuation, each of whom offered a written report. The husband hired Meyers, Harrison & Pia, LLC, and the court heard from Vladimir Korobov, who valued the husband's interest in Starwood and related entities as of April 30, 2014, as $3, 350, 000.00. (Exhibit #75.) For her part, the wife hired Lisa J. Cruikshank of Financial Research Associates, who valued his interest therein as of June 30, 2014, as $5, 303, 281.00. (Exhibits #38, #39, and #40.) After considering the testimony and evidence, the court found the opinion of Mr. Korobov to be the most credible. However, given the fact that the husband's employment at Starwood has since terminated, and his interest bought out per the Separation and Release, it is now a moot point. Nevertheless, it is worth pointing out that after taking into account the charged for non-party attorneys fees, the buyout, and the remaining vested " promote" interests, that total is closer to the number arrived at by the husband's expert.
Other assets include motor vehicles, bank accounts, and two modest retirement accounts. In addition, the husband maintains several life insurance policies with cumulative cash values in excess of $120, 000.00. Each party disclosed that they have a residuary interest in trusts established by their respective families.
At some point following the filing of this action, the husband, in response to an e-mail from his boss, Barry Sternlicht, (Exhibit #54) dated July 31, 2014, had a conversation with him. The upshot of that talk was the fact that Starwood was underperforming and was having a hard time attracting new investors and, as a result, should be " shutdown." (Exhibit #56.) From that point on there would ultimately be a parting of the ways between the husband and Starwood. In addition, the husband testified that he was " burned out, " and Mr. Sternlicht testified that as of the date of the hearing, he no longer desired to have the husband in his employ. He did ask him to remain at the firm until such time as a suitable replacement could be found. At some point following the initial closure of the evidence, but before the decision was rendered, the husband did leave his employment with Starwood. He signed a Separation Agreement and Release (Exhibit #111) dated April 20, 2015, under the terms of which, he was to be paid a final distribution in the amount of $1, 134, 551.00, together with the prospect of additional distributions, as if and when certain other partially vested assets, referred to in Article 2.d therein as " Promote Interests, " are ultimately liquidated.
During the pendency of this matter, the court appointed Gordon ADR to be a Discovery Master, and the parties incurred fees in the amount of $55, 077.75. To date, $31, 677.75 has been paid by the husband, leaving a balance due in the amount of $23, 400.00.
As to the cause of the breakdown of the marriage, while both agreed that the marriage had broken down irretrievably, neither party offered substantial details. The wife indicated that the marriage was over by 2004, and cited a steady decline in intimacy. In addition, she told the court that she and her husband " had nothing in common except the children." For his part, the husband felt that the parties had drifted apart, and that the foundation of the marriage was never solid to begin with. He felt that it had broken down between 2005 and 2006.
The trial took place over the course of 16 days, including final argument, a discovery conference, and pendente relief. The evidence was opened in order to take additional evidence regarding the husband's termination and severance. Following the close of the evidence, the court entered a pendente lite modification of alimony and child support by way of a Memorandum of Decision (#434.00) dated May 19, 2015.
PENDENTE LITE RELIEF
At the time of trial, there were several outstanding pendente lite motions, some of which the court disposed of in limine . The three remaining included Defendant's Motion to Modify Pendente Lite Alimony and Support (#385.00) dated November 13, 2014. The court disposed of this motion by way of a separate Memorandum of Decision (#434.00) dated May 19, 2015. The wife filed two motions (#392.00 and #393.00), both dated November 21, 2014, claiming a violation of the automatic orders in the first and a violation of a specific court order in the second, and she asked the court to find the husband in contempt. In summary, she claims that the husband failed to make mortgage and real estate tax payments on the marital home, as well as agreed to the payment of attorneys fees to Starwood.
" Due process of law requires that one charged with contempt of court be advised of the charges against him, have a reasonable opportunity to meet them by way of defense or explanation, have the right to be represented by counsel and have a chance to testify and call witnesses in his behalf." Bryant v. Bryant, 228 Conn. 630, 637, 637 A.2d 1111 (1994); Kelly v. Kelly, 54 Conn.App. 50, 59-60, 732 A.2d 808 (1999). In addition, a finding of contempt must be based upon a willful failure to comply with a clear and unequivocal order of the court. Sablosky v. Sablosky, 258 Conn. 713, 718, 784 A.2d 890 (2001), and " a finding of indirect civil contempt must be established by sufficient proof that is premised on competent evidence presented to the trial court and based on sworn testimony." Dickinson v. Dickinson, 143 Conn.App. 184, 190, 68 A.3d 182 (2013). Finally, a finding of indirect civil contempt must be based upon clear and convincing evidence. Brody v. Brody, 315 Conn. 300, 318-19, 105 A.3d 887 (2015).
The court heard considerable testimony by the parties and their witnesses. As to the alleged violation of the automatic orders, the court finds that the wife failed to prove by clear and convincing evidence that the husband's agreement to allow Starwood to deduct legal fees was entirely voluntary and done with the intent to reduce the marital estate. On the contrary, given the strained employer-employee relationship, and the fact that the fees were triggered in the first place by the wife's discovery, the court cannot make a finding of willful contempt. Accordingly, Motion #392.00 is HEREBY DENIED. Likewise, although Judge Emons's order was clear and unequivocal, the evidence does not support a finding of willful contempt. In fact, for instance, the husband introduced some evidence of his payment of the alimony and support order. (Exhibit #108.00.) Moreover, given the husband's compensation structure, the evidence would support a finding that his net base income was insufficient to consistently maintain his alimony and support obligation, and pay housing expenses for the marital home in a timely fashion without borrowing against assets. Accordingly, Motion #393.00 is HEREBY DENIED.
The Court, having heard the testimony of both parties and their witnesses, and having considered the evidence presented at hearing, as well as, inter alia, the factors enumerated in General Statutes § § 46b-56, 46b-56a, 46b-56c, 46b-81, 46b-82, 46b-84, and 46b-215a, including the Child Support and Arrearage Guidelines Regulations, hereby makes the following findings:
1. That it has jurisdiction.
2. That the allegations of the complaint are proven and true.
3. That the marriage of the parties has broken down irretrievably, and that ample evidence exists that both parties have contributed to said breakdown.
4. That there are three minor children born to the wife issue of the marriage, to wit: Sam, age 15; James, age 13; and Grace, age 11.
5. That during the marriage, neither party has received any aid or assistance from the State of Connecticut or any town or political subdivision thereof.
6. That in entering an order for child support, a court must consider both General Statutes § 46b-215b and the Child Support and Arrearage Guidelines Regulations (" Guidelines "), as well as the factors set forth in General Statutes § 46b-84, Maturo v. Maturo, 296 Conn. 80, 90-92, 995 A.2d 1 (2010); and that child support orders must be based upon the net income of the parties. Morris v. Morris, 262 Conn. 299, 306, 811 A.2d 1283 (2003); Ludgin v. McGowan, 64 Conn.App. 355, 358, 780 A.2d 198 (2001).
7. That on May 19, 2015, the court ordered the husband to pay child support as set forth in a certain Memorandum of Decision (#434.00); that the court herby incorporates Findings numbered 4 through 6 thereof in this decision; that the net income of the husband is $3, 757.56 per week ($16, 282.76 per month); and that the net income of the wife is $393.00 per week ($1, 704.00 per month).
8. That the combined net weekly income of the parties is in excess of the maximum Child Support Guidelines amount; that presumptive basic child support is $824.00 per week; and that the husband's share is $752.00 per week.
9. That it is more likely than not that the parents would have provided support to each of the children for higher education or private occupational school if the family were intact, in that in their proposed orders, each parent has requested that the court to retain jurisdiction to enter educational support orders in the future. General Statutes § 46b-56c .
10. That where time-limited alimony is awarded, there must be " sufficient evidence to support" the court's finding that it is appropriate. Wolfburg v. Wolfburg, 27 Conn.App. 396, 399 (1992); Marmo v. Marmo, 131 Conn.App. 43, 26 A.3d 652 (2011); and that taking into consideration the factors set forth in General Statutes § 46b-82, including the age, education, earnings, and work experience of the wife, in light of the facts and circumstances of this case, a time-limited award of alimony is appropriate. Ippolito v. Ippolito, 28 ...