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Lavy v. Lavy

Appellate Court of Connecticut

May 21, 2019

Michele Brown LAVY

         Argued January 9, 2019

         Appeal from the Superior Court, Judicial District of Stamford-Norwalk, Heller, J.

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          Alexander J. Cuda, Westport, for the appellant (plaintiff).

         Eric M. Higgins, Stamford, with whom, on the brief, was Sarah Gleason, for the appellee (defendant).

         Prescott, Elgo and Harper, Js.


         PRESCOTT, J.

         [190 Conn.App. 189] The plaintiff, Gad Lavy, appeals from the judgment of the trial court granting the motion of the defendant, Michele Brown,[1] to open and reform the parties’ marital dissolution judgment because the plaintiff failed to disclose on his financial affidavit two marital assets: a savings account with First Niagara Bank, N.A., formerly known as NewAlliance Bank (Niagara account), and real property located in the Middle East (Jerusalem property). The plaintiff later amended this appeal to challenge the court’s subsequent decision to grant the defendant’s motion for an award of postjudgment interest. On appeal, the plaintiff claims that the court improperly (1) found that his failure to disclose the Niagara account and Jerusalem property on his financial affidavit constituted material omissions that triggered remedial measures set forth in the parties’ separation agreement, which was incorporated by reference into the judgment of dissolution, (2) awarded the defendant prejudgment interest despite her having requested such relief for the first time in her posthearing brief, and (3) awarded the defendant postjudgment interest during the pendency of the appeal, purportedly in violation of the automatic appellate stay. We reject the plaintiff’s claims and, accordingly, affirm the judgment of the trial court.

          The following facts and procedural history, which were found by the court or are

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uncontested, are relevant to our resolution of the plaintiff’s claims. The court dissolved the parties’ marriage on June 14, 2011, following an uncontested hearing. The judgment of dissolution incorporated by reference the parties’ separation agreement. The parties attached to the separation agreement financial affidavits dated June 14, 2011.

         [190 Conn.App. 190] In article XXI, paragraph 21.1, of the separation agreement, the parties represented that their attached financial affidavits were true and accurate. They further stated that they had relied on the facts set forth in those financial affidavits in reaching the terms and financial arrangements set forth in the separation agreement. Paragraph 21.1 further provides: "Each party expressly represents that there has been no substantial change in circumstances to [either party] since the date of said affidavits and that said affidavits fully, fairly and accurately [sets] forth the existing assets, liabilities, and income of the parties. The parties expressly represent to each other that they do not own any other assets nor are any assets being held by a third party for the benefit of either [party], except those described and divided under the terms of this agreement and the parties’ respective financial affidavits. Each party represents that he or she relied on the financial affidavits and voluntary disclosures and representations made by the other party in the course of this dissolution of marriage action for purposes of arriving at the terms of this agreement. The parties further acknowledge that each has a fiduciary duty to the other to make a full and fair disclosure of his or her financial circumstances, including all assets, to the other in connection with this proceeding. In the event of a material omission or misstatement by either party in his or her affidavit, the other party shall have the right to rescind this [a]greement and reopen and reform any judgment entered in the pending action incorporating the terms hereof." Article XXI of the separation agreement further provides that if either party made a material omission of an asset on his or her financial affidavit, the other party would be entitled to receive 75 percent of the undisclosed asset’s value measured at the time of dissolution. The party who failed to disclose an asset also would be liable for the other party’s "reasonable legal fees, expert fees, and court costs."

         [190 Conn.App. 191] On August 9, 2011, the defendant filed a motion to open and reform the June 14, 2011 judgment of dissolution, invoking article XXI of the separation agreement. According to the defendant, the plaintiff had failed to disclose on his June 14, 2011 financial affidavit the existence of the Jerusalem property, which she described as a condominium apartment and storeroom. She also claimed there was a "likelihood beyond mere suspicion that the plaintiff has failed to disclose additional assets as yet unknown to the defendant" because his financial affidavit did not disclose any bank accounts in Israel or other means by which the plaintiff could pay the taxes and costs associated with owning the condominium. The defendant asked the court to open the dissolution judgment for the purpose of conducting limited discovery and, if necessary, to distribute any undisclosed property in accordance with the separation agreement, including awarding reasonable attorney’s fees and costs.

          In response to the defendant’s motion to open, the plaintiff initially filed a motion to dismiss asserting insufficiency of process, which he later withdrew. He subsequently filed a motion to strike, challenging the legal sufficiency of the defendant’s motion, and a request to revise. The court denied both motions. The defendant never filed a written opposition addressing the merits of the motion to open.

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          On December 14, 2011, the defendant amended her motion to open and reform the dissolution judgment, asserting that, since filing her initial motion, she had learned of additional grounds for granting the motion. Specifically, in addition to reasserting the allegations in her initial motion to open, the defendant asserted that the plaintiff had failed to disclose the existence of the Niagara account, which she described as a savings account that had been open for at least three years and, [190 Conn.App. 192] thus, existed at the time the plaintiff submitted his June 14, 2011 financial affidavit.

          The parties eventually executed a stipulation in which they agreed to have the court open the dissolution judgment for the limited purpose of conducting discovery. The stipulation expressly provided that it was "not an admission of any misrepresentation or fraud on the part of either party with respect to the representations made at the time of [j]udgment." The court approved the stipulation and made it an order of the court on November 5, 2012.

          On June 15, 2016, the plaintiff filed a motion in which he asserted that the defendant had opened the Niagara account in the plaintiff’s name, without his knowledge, using her own funds, and, thus, she had a duty to disclose the Niagara account on her financial affidavit. According to the plaintiff, the defendant’s failure to disclose the existence of the account entitled him to an award of legal fees and costs under the terms of the separation agreement.

          The court conducted an evidentiary hearing on the defendant’s motion to open, as amended, on November 16 and 17, 2016. At that time, the court also considered the plaintiff’s motion for an award of costs and attorney’s fees. The parties submitted posthearing memoranda and reply memoranda. The court later granted a request by the defendant for additional oral argument, which it heard on April 11, 2017.

         The court issued a memorandum of decision on August 7, 2017, granting the defendant’s motion to open and reform the dissolution judgment. With respect to the Jerusalem property, the court found that the plaintiff’s brother had conveyed the property to him for no consideration and that a title abstract reflecting the conveyance had been recorded in the Jerusalem land [190 Conn.App. 193] registry on January 27, 1999.[2] The plaintiff remained the record owner of the Jerusalem property at the time of the dissolution judgment. Although the plaintiff testified that he had not included the Jerusalem property on his financial affidavit because he did not know he owned the property, the court did not find that testimony credible. Rather, the court credited the testimony of the defendant’s real estate expert, Attorney Yoram Hacohen,[3] who opined that before a conveyance for no consideration could be recorded on the land records in Jerusalem, the grantee, in this case the plaintiff, would have been required to sign a number of legal documents.[4] The court found that the fair market

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value of the Jerusalem property, measured in United States dollars at the time of the dissolution judgment, was $ 146,379. The court further found that the plaintiff’s failure to include the Jerusalem property on his June 14, 2011 financial affidavit was a material omission.[5]

          The court made the following findings relative to the defendant’s knowledge of the Jerusalem property at the time of the dissolution judgment. "The Jerusalem [190 Conn.App. 194] property came to [the defendant’s] attention as a result of her efforts to locate property that was owned by [the plaintiff] in Israel.... [I]n early 2011, she and her counsel in the dissolution action had retained an attorney in Israel to find out whether [the plaintiff] owned any property there. That attorney engaged a private investigator, who advised them that [the plaintiff] did not own any real property in Israel. Shortly before the uncontested dissolution hearing, however, [the defendant’s] boyfriend, who was ...

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