Opinion
No. FA04-400 09 76 S
File Date: November 20, 2006.
FINDING OF FACTS AND CONCLUSIONS OF LAW RE TERMINATION OF AUTOMATIC STAY
PROCEDURAL HISTORY:
This matter was tried before the Regional Family Trial Docket, on a referral from the Stamford Judicial District, on May 9th-11th and May 22nd, 2006. The court issued a written decision on July 25, 2006. On August 10, 2006, the Plaintiff filed a Postjudgment Motion to Terminate Stay of Execution and the defendant filed a Statement in Opposition to Motion to Terminate Stay. The court heard oral argument on the motions and terminated the stay on October 3, 2006, without written findings of fact and conclusions of law.
In the present case, the court granted the plaintiff's motion to lift the automatic stay provisions as to certain orders of the equitable distribution. Specifically, the court lifted the automatic stay in connection with the lump sum alimony award of $113,148 and as to the plaintiff's share of $246,766.80 in the Bank of America savings account. The court also terminated the stay of the $50,000 award of attorneys fees.
APPLICABLE LAW:
Section 61-11 of the Practice Book sets out the rules for stays of execution in noncriminal cases. Practice Book § 61-11(a) provides in relevant part:
"Except where otherwise provided by statute or other law, proceedings to enforce or carry out the judgment or order shall be automatically stayed until the time to take an appeal has expired. If an appeal is filed, such proceedings shall be stayed until the final determination of the cause."
The proper procedure for the termination, or lifting, of an automatic stay is provided in Practice Book § 61-11(d). Section § 61-11(d) provides that "[a] motion to terminate the stay of execution may be filed before judgment; if it is, it may be ruled upon when judgment is entered. If such a motion is filed before judgment, or after judgment but before an appeal, it shall be filed in triplicate with the clerk of the superior court. If it is filed after an appeal is filed, an original and three copies shall be filed with the appellate clerk, who shall forward the motion to the judge who tried the case. That judge shall file any ruling thereon with the appellate clerk and with the clerk of the trial clerk where the matter was tried. If the judge who tried the case is unavailable, the motion shall be forwarded to the clerk of the court in the judicial district where the case was tried, who shall assign the motion for a hearing and decision to any judge of the superior court."
Practice Book § 61-11(c) sets out two grounds upon which a judge may grant a motion to terminate an automatic stay. Section 61-11(c) provides: "Termination of stay may be sought in accordance with subsection (d) of this rule. If the judge who tried the case is of the opinion that (1) an extension to appeal is sought, or the appeal is taken, only for delay or (2) the due administration of justice so requires, the judge may at any time after a hearing, upon a motion or sua sponte, order that the stay be terminated." It is within the trial court's discretion to determine whether due administration of justice warrants the termination of a stay of execution. Northeastern Gas Transmission Co. v. Benedict, 139 Conn. 36, 40-41, 189 A.2d 379 (1952. The determination of whether "due administration of justice" requires a termination of an automatic stay must involve an analysis in which the following principles are considered: (1) the likelihood of success on appeal; (2) the irreparability of injury to be suffered if the stay is lifted; (3) the effect of the stay on other parties to the proceedings; and (4) the public interest. Griffin Hospital v. Commission of Hospitals, 196 Conn. 451, 456-57, 493 A.2d 229 (1985).
In addition, Practice Book § 61-11(b) sets out the matters in which no automatic stay is available under § 61-11(a). It provides in relevant part: "no automatic stay shall apply to orders of relief from physical abuse pursuant to General Statutes § 46b-15 or to orders of periodic alimony, support, custody or visitation in domestic relations matters brought pursuant to chapter 25 or to any later modification of such orders." Notwithstanding, Practice Book § 61-12 does provide for discretionary stays in noncriminal matters in which the automatic stay provisions of § 61-11 are not applicable and in which there are no statutory stay provisions. Finally, Practice Book § 61-14 provides in relevant part that "the sole remedy of any party desiring the court to review an order concerning a stay of execution shall be by motion for review under [Practice Book] Section 66-6. Execution of an order of the court terminating a stay of execution shall be stayed for ten days from the issuance of notice of the order, and if a motion for review is filed within that period, the order shall be stayed pending the decision of the motion, unless the court having appellate jurisdiction rules otherwise.
" The family law cases discussed below deal with the issue of termination of a postjudgment stay.
In Wasson v. Wasson, Superior Court, judicial district of Stamford, Docket No. FA 98-0165911 (April 19, 2004, Frazzini, J.), the plaintiff-appellee moved the trial court to terminate, in whole or part, the automatic stay. The court found that in considering the plaintiff's motion for stay pursuant to § 61-11(c)(2) and the principles set forth in Griffin, "the due administration of justice requires a stay of certain financial orders because of the best interests of the minor children and to preserve the full value of the parties' most significant asset, the marital home." The court explained its analysis as follows:
The first Griffin factor is the likelihood of success on appeal. In view of the broad discretion afforded [to] trial courts in dissolution actions, the defendant's appeal in this action faces an uphill battle . . . The second factor set forth in Griffin . . . irreparable harm to appellee, strongly militates in the plaintiff's favor. In view of the defendant's continuing reduction of assets during the appeal period, it becomes ever more important to preserve the full value of the equity in the marital home for the financial welfare of the plaintiff and her minor children. The third Griffin factor, the effect of delay in implementing the judgment on other parties to the action, also supports terminating the stay . . . [T]erminating the stay is probably the only way to ensure preservation of the equity . . . The children would also be significantly harmed emotionally by the loss of the marital home through foreclosure. The Connecticut legislature has adopted a public policy in favor of the best interest of the children . . . In Griffin . . . the court specifically rejected a claim that courts must apply a 'rigid formula' in deciding whether to grant a stay. Even if the best interests of the three minor children here do not qualify as the sort of 'public interest' that Griffin mandates considering when applicable, in balancing the equities, this court concludes that their interest in continuing to live in their home must be considered. The parties have been unable to work together to save the marital home; terminating the stay will not only protect the parties' own financial interest, but also serve the best interest of these three children, already so wounded by the conflict between their parents.
In Pospisil v. Pospisil, Superior Court, judicial district of Tolland, Docket No. FA 93 0054011 (February 26, 1999, Zarella, J.), the plaintiff moved to terminate the automatic stay of execution which was entered when the defendant appealed the trial court's denial of his motion to re-open the stipulation for judgment. The court denied the motion based on its analysis of the four pertinent principles of due administration of justice as set out in Griffin: (1) the likelihood that the defendant will prevail on appeal; (2) the irreparability of the injury to be suffered from the execution of the judgment; (3) the effect of the stay upon the other parties to the proceedings; and (4) the public interest involved.
As for the first factor, the court stated that in its opinion "the trial court's decision was reasonable and rational in light of existing law . . . While this court is mindful that there is a possibility that the Appellate Court could choose, in reviewing the defendant's claims, to reverse the denial of the motion to re-open the judgment, the likelihood of that happening is slight, particularly in light of the fact that the standard for appellate review is abuse of discretion by the trial court . . . Thus the likelihood that the defendant would prevail on appeal is slight." (Citations omitted.)
As for the second factor, the court stated that neither party would be irreparably harmed by the continuation of the automatic stay. The court found the plaintiff's claim that the pension fund should be immediately executed because she may lose its benefit if the defendant died while the appeal was pending to be insufficient, as there was no testimony that he was in imminent danger of dying. In addition, the court found that the plaintiff's argument that she was entitled to court-ordered attorneys fees because they were awarded as support also to be insufficient, due to the fact that those fees were actually awarded in connection with the court's finding the defendant in contempt.
In its analysis of the third factor, the court stated that there were no third parties, such as children, that may be impacted by the continuation of the automatic stay to consider.
Finally, the court held that as to the fourth factor, there were few, if any, public policy concerns. "The stay arose out of an appeal of a divorce decree, a matter private in nature. The only persons affected by the judgment as it relates to the pension and the attorneys fees are the plaintiff and defendant."
Thus, the court held that "[h]aving considered all four principles, it is the opinion of this court that the due administration of justice does not require that the stay in this case be terminated. Neither party is likely to suffer irreparable harm from the stay of the court's denial of the motion to reopen and order to sign the QDRO and award of attorneys fees. No other parties are effected by the stay and there are no public policy considerations that weigh against leaving the stay in place. Although the defendant is unlikely to succeed on appeal that alone is not sufficient reason to terminate the stay."
In Hill v. Hill, Superior Court, judicial district of Fairfield, Docket No. FA 91 0374254 (January 8, 2001, Sheedy, J.), the petitioner filed a motion to terminate a stay pending the appeal with regard to certain judgments. The court granted the motion to terminate the automatic stay based on both grounds provided in Practice Book § 61-11(c) — that the appeal was being taken only for delay and that it would frustrate the due administration of justice. The court based its decision on the following: (1) Hill had filed numerous [unsuccessful] appeals throughout the case; and (2) "[i]n view also of the conduct of Hill (the number and duplication of motions filed, the inflammatory and accusatory content of those motions, her failure to comply with prior court orders as here referenced, her non-compliance with the rules of practice applicable to pro se parties particularly as regards notice to parties, etc.)."
In Hauge v. Mapley, Superior Court, Judicial District of Stamford, Docket No. FA 01 01871 (July 17, 2003, Abery-Wetstone, J.), the court terminated, sua sponte, the automatic stay pursuant to Practice Book § 61-11(d), in the interest of due administration of justice. The court stated that "[t]he Court is making this order due to the defendant's repeated willful contempt of the pendente lite orders, the defendant's having no assets in his name or employment in the U.S., and the Court's finding that the defendant intentionally submitted a financial affidavit that failed to accurately reflect his income or assets."
In Smith v. Smith, Superior Court, judicial district of Danbury, Docket No. FA 01 00341470 (July 15, 2003, Abery-Wetstone, J. ), the court terminated the automatic stay pursuant to Practice Book § 61-11(d) in the event of an appeal by either party. The court stated that "the court is making this order due to the precarious state of the wife and minor child's financial condition and the knowledge that the plaintiff has violated the automatic orders and numerous prior court orders."
In Zilkha v. Zilkha, Superior Court, judicial district of Stamford, Docket No. FST FA 03 0196546 (May 25, 2005, Black, J.), the plaintiff filed a motion to terminate stay in reference to a previous order directing the defendant to pay $110,000 to the plaintiff's counsel in legal fees. The court found that ground two, due administration of justice, required a termination of the stay based on the following: "The Court has found the defendant to be in contempt; he has repeatedly not followed the Court's direction. He has hampered the process by his inability to heed orders or by completely ignoring the Court's order all the while feigning innocence. He has dissipated the assets of the marital estate to the detriment of his children."
In Kelly v. Kelly, Superior Court, Judicial District of Waterbury, Docket No. FA 04 0184087 (June 6, 2006, Cutsumpas, J.T.R.), the plaintiff moved for a termination of the automatic stay of execution pending appeal with respect to the sale of the marital residence and the division of the proceeds. The court held that because "[the] child would obviously benefit from the sale [of the home] and neither party would be prejudiced financially because the net proceeds would be held in escrow pending disposition of the appeal . . . [t]he due administration of justice requires the termination of stay."
ANALYSIS:
In this case, the court terminated the stay as to the award of lump sum alimony in the amount of $113,148.00 and the plaintiff's $246,766.80 share of the Bank of America account.
The alimony award was based on a percentage of the defendant's yearly bonus income and was to be awarded on a yearly basis. Practice Book § 61-11(b) sets out the matters in which no automatic stay is available under § 61-11(a). It provides in relevant part: "no automatic stay shall apply to orders of relief from physical abuse pursuant to General Statutes § 46b-15 or to orders of periodic alimony, support, custody or visitation in domestic relations matters brought pursuant to chapter 25 or to any later modification of such orders." The term lump sum alimony was utilized by the court to indicate this was to be a yearly payment based on the defendant's yearly bonus income (typically received in a lump sum in January each year). The $113,148.00 was calculated as a percentage of the defendant's 2005 bonus received in 2006 and as such is periodic alimony and not subject to the stay.
The second factor set forth in Griffin . . . irreparable harm to appellee, strongly militates in the plaintiff's favor. It is clear to the court that without the $113,148 alimony and the plaintiff's $246,766.80 share of the Bank of America account, she will be unable to maintain the home she and the minor children occupy. As was cited in the Wasson case, the minor children in the instant case would be significantly harmed emotionally by the loss of the marital home through foreclosure. The plaintiff has insufficient assets to maintain the marital home during the appeal period without the termination of the stay as to the Bank of America account. Additionally, the property settlement included the following assets still covered by the stay and available if the appeal is successful:
PROPERTY SETTLEMENT:
a. The marital home has an appraised value of the property of $2,600,000, the mortgage on the property is $1,200,000, and marital equity in the property is $1,400,000;
b. The wife has an interest in the trust that holds the property occupied by her parents in Reading, MA, with a value of $174,000;
c. The wife has a Citibank incentive savings with an approximate balance of $125,185.38;
d. The wife has a Hudson IRA with an approximate balance of $18,723.15;
e. The couple own a time share in Florida with an approximate purchase price of $16,000;
f. The couple own a time share in Colorado with an approximate purchase price of $31,000;
g. The husband has a security deposit on his rented home in the approximate amount of $11,000;
h. The husband has a Hudson Bank savings account with a balance of approximately $140,090;
i. The husband has a Hudson Bank checking account with an approximate balance of $52,977;
j. The husband has a Bank of America savings account with a balance of $637,574 (minus the $113,148 awarded to the wife as lump sum alimony and the sum of $113,148 awarded to the wife as child support above);
k. The husband has a Bank of America credit in the approximate amount of $3,084;
l. The husband has a Fidelity Investment account with an approximate balance of $25,450;
m. The husband has a Bank of America 401k in the approximate amount of $30,141 and a Bank of America unvested pension with an approximate value of $11,962, a Bank of America 401k Restoration Plan, in the approximate amount of $103,156, The husband also has a Bank of America unvested Pension Restoration plan with an approximate value of $2,403. The husband has a Hudson Bank IRA, with an approximate value of $123,956.
n. The defendant has 852.72 shares of Bank of America stock, vested 2/06, trading at $48.23 on July 18, 2006, having an approximate value of $41,127. The husband owns 2,584 shares of restricted stock granted 2/15/05 — 1/3 vested 2/06 and 1/3 will vest on 2/07 and 2/08. The husband was awarded 7,190 shares of Bank of America restricted stock for 2005 performance that vest 1/3 on 2/07, 2/08 and 2/09. The husband was awarded 500 shares of restricted stock KASP for 2005, vesting 1/3 each on 2/07, 2/08 and 2/09. Finally, the husband has 7,000 unvested stock options granted on 2/16/06 with a strike price of $44.36 per share. The options will vest 2,333 on 2/15/07 and 2/15/08 and 2,334 on 2/15/09.
All of the above assets (not including the stock options or restricted stock), in excess of $2.5 million dollars, remain covered by the stay and provide more than sufficient security for the husband's interest in the event the trial court decision is overturned on appeal. Therefore, neither party will be irreparably harmed by lifting the stay on these assets. In fact, the release of the funds will permit the plaintiff to maintain the mortgage on the family home and thereby preserve that asset.