Michaelson v. Michaelson

Yesawich Jr., J.

Appeal from that part of an order of the Supreme Court (Kahn, J.), entered June 20, 1991 in Albany County, which denied plaintiff’s motion to compel defendant to comply with the terms of the parties’ judgment of divorce.

Following extensive negotiations, plaintiff and defendant entered into a stipulation on the record on August 30, 1990 resolving their pending matrimonial litigation. The stipulation was incorporated but not merged into a judgment, dated October 12, 1990 and entered October 16, 1990. At issue is Supreme Court’s interpretation of the judgment insofar as it provides "that the plaintiff shall receive cash and bonds equal to 50 percent of the value of the defendant’s accounts held at First Albany Corporation and Shearson Lehman Hutton, Inc. as of August 30, 1990, said accounts value to be not less than $875,000.00; and * * * that the bonds and/or cash in the above accounts shall be divided as equally as possible in a like kind division within 15 days from the date of this judgment’’ (emphasis supplied).

On August 30, 1990, defendant had bonds and cash worth $218,566.91 in his First Albany account and $707,662.94 in his Shearson Lehman account for a total of $926,229.85. Although 50% of this sum equals $463,114.92, defendant transferred only $392,500 worth of bonds and cash to plaintiff and that transfer did not occur until December 5, 1990. Between August 27, 1990 and the morning of August 30, 1990, before the stipulation was entered into, defendant wrote various checks totaling $60,502.45 on his First Albany account; of this *856amount, $35,968.75 went to satisfy defendant’s legal fees. Defendant contends that because the August 30, 1990 total less these uncashed checks equals $865,727.40, plaintiff was entitled to half the $875,000 minimum provided for in the judgment. From that amount, defendant withheld $45,000 for legal, accounting and appraisal fees which he had previously paid plaintiff pursuant to a May 16, 1989 pendente lite order issued by Supreme Court. The order provided "that the sum paid by defendant pursuant to this order shall be a credit to defendant at the time of equitable distribution”.

Supreme Court denied plaintiff’s motion for an order directing (1) defendant to pay her $80,290.61, the difference between one half of the value of the accounts on August 30, 1990 and the amount defendant actually paid her, (2) an accounting of all interest earned on the two accounts from August 30, 1990 to date and the disposition of that interest, and (3) a sum equal to the interest earned on one half of the accounts through the date of payment to her. Plaintiff appeals. We agree with Supreme Court to the extent that it allowed defendant to withhold $45,000 for fees previously paid from the amount owed plaintiff, but differ as to the remaining issues.

Generally, "[a] judgment is the law’s last word in a judicial controversy, it being the final determination by a court of the rights of the parties upon matters submitted to it in an action or proceeding” (Towley v King Arthur Rings, 40 NY2d 129, 132; see, CPLR 5011). However, Domestic Relations Law § 237 (a) specifically empowers the court to award interim litigation expenses "in the final judgment * * * or by one or more orders from time to time before final judgment, or by both” (emphasis supplied) (see, Scheinkman, Practice Commentary, McKinney’s Cons Laws of NY, Book 14, Domestic Relations Law C237:3, at 507; Scheinkman, 1987 Supp Practice Commentaries, McKinney’s Cons Laws of NY, Book 14, Domestic Relations Law C237:4 [1992 Pocket Part], at 174-175). In adhering to the prior determination that defendant was to receive a credit upon such distribution, Supreme Court’s decision is consistent with the word and spirit of this law.

With respect to plaintiff’s share of defendant’s brokerage accounts, the transcript of the open-court settlement stipulation makes clear that $875,000 was the number chosen because it was the amount of municipal bonds and cash that defendant represented was in his name in First Albany on August 30, 1990. This and the specific language of the final judgment previously highlighted suggest that it was the par*857ties’ intent that plaintiff receive half the amount that was in defendant’s brokerage accounts on August 30, 1990 and that those accounts at that moment, as represented by defendant, totaled at least $875,000. Later communications between the parties’ counsels are consistent with this.

Defendant maintains that the value of his brokerage accounts on August 30, 1990 is not the amount actually in the account on that day as evidenced by the account statements, but rather that amount less the $60,502.45 in checks drawn on his account with First Albany which were outstanding on that day. Although there is no evidence that these checks were written other than in the normal course of business, until the time they were cashed they could be canceled by defendant. As a consequence, defendant still had access to the amount that was actually in the accounts on August 30, 1990; hence, plaintiff’s share of these accounts was $463,114.92. Applying the $45,000 credit to which defendant is entitled reduces plaintiff’s share to $418,114.92. Inasmuch as plaintiff has only received $392,500, defendant is obligated to pay over to her an additional $35,290.61.

With respect to plaintiff’s claim for interest, the stipulation sets no time for distribution of her share of the brokerage accounts and makes no provision for the payment of interest. However, the judgment entered thereon provides that distribution be made to plaintiff within 15 days of the date thereof, October 12, 1990. Inasmuch as defendant had no obligation to transfer the funds to plaintiff prior to October 27, 1990, there is no basis for an award of interest prior to that time. However, plaintiff is entitled to interest at the rate of 9% per annum on her $418,114.92 share from October 27, 1990 until December 5, 1990 (see, CPLR 5003) and on $25,614.92 from and after December 5, 1990 to the date when such payment is made (see, CPLR 5004; Siegel, NY Prac § 412, at 627 [2d ed]; cf., Citibank v Liebowitz, 110 AD2d 615).

Mikoll and Harvey, JJ., concur.