Ann T. Zentek v. Thaddeus J. Zentek (2013)

MEMORANDUM OF DECISION

This action seeks the dissolution of the parties' 29–year marriage.   The action was commenced by complaint dated August 4, 2011 and returnable to the court on August 30, 2011.

The matter was tried before the court on October 10, 11 and 21, 2013.   The court has considered all the credible evidence presented to it along with its observation of the demeanor and attitude of the parties.   All the exhibits have been carefully reviewed and considered, as well as relevant common law, including, without limitation, the statutory criteria set forth in General Statues § 46b–82 as to assignment of alimony and § 46b–81 as to assignment of property and transfer of title.   The court has carefully considered the respective criteria for orders of alimony, property division, payment of counsel fees, and has unsealed financial affidavits.   The findings of fact made by the court have been made by a fair preponderance of the evidence.

FINDINGS OF FACT

The parties were married on December 29, 1984 in New Orleans, Louisiana.   The parties lived in the State of Connecticut for at least one year before the filing of the dissolution complaint.   The parties have not been recipients of state aid.   The court finds that the allegations of the complaint are proven and true.   The parties' marriage has broken down irretrievably with no hope of reconciliation.   All statutory stays have expired.   The court has jurisdiction over this matter.

Plaintiff wife is 52 years old and in good health.   She is a college graduate and a Program Director at Community Health Resources.   The Defendant husband is 53 years old and holds a bachelor's degree from Marietta College in petroleum engineering.   He is the owner of Zentek Insurance.

Three children were born to the parties during the marriage:  Thaddeus age 25, Eric age 21 and Blair age 19.   All three are enrolled in institutions of higher education.   Blair reached the age of majority during the pendency of the action and there was a pendente lite child support order in effect for Blair.   Plaintiff has a child support arrearage of $1,205 as of October 4, 2013.   She pays defendant $25 per week toward the arrearage.¹

Plaintiff wife alleges she determined that the marriage failed on February 4, 2008, her birthday.   She alleges that she and her husband always had a healthy sexual relationship.   She states that on that day she wanted to be “close” with her husband but he refused her, calling her “overweight.”

Although the plaintiff believes this event as dispositive of the date her marriage failed, there were earlier signs that the marriage may have been in trouble.   Plaintiff testified that a Guardian Monitor System had been installed on the home computer to monitor their children's computer usage.   She discovered sometime in 2006/2007 that the defendant was surfing the internet for women in the Simsbury area with whom to engage in sexual activity.

In September 2008 the defendant traveled to the Tropicana Casino to meet “Debbie.”   Mr. Zentek had sexual relations with Debbie and paid approximately $300 to $400 for the expenses related to the trip.   In January 2009, the defendant travelled to Las Vegas to gamble and meet with Natania Cook. Mr. Zentek engaged in sexual relations with Ms. Cook and paid $600 to $700 for the expenses associated with the Las Vegas trip.   In June 2009 defendant flew to Chicago to be with Ms. Cook and took her to a Chicago Cubs baseball game.   He again paid for all expenses.

Following plaintiff's discovery of the extramarital affair, the couple engaged in approximately 20 sessions of marriage counseling in late 2009 with 3 different therapists.   Mr. Zentek alleges that the counseling was unsuccessful due to plaintiff's desire to switch therapists because she did not like what she heard from the therapists.   He alleges they were discharged by their last therapist as the sessions were becoming volatile.   Ann Zentek alleges the need to change therapists was the result of defendant's inability to be open and honest during therapy sessions.   Regardless of the reason, the marriage suffered from a lack of trust between the parties and several arguments, somewhat violent at times, ensued.   Plaintiff believed her husband remained unfaithful and her desire to check the contents of defendant's cell phone led to several confrontations between the parties.   Plaintiff vacated the marital home in September 2011.   The defendant testified that he did not have sexual relations with anyone other than Debbie, Ms. Cook and his wife.   The court does not find his testimony credible in this regard.

There is no dispute that the parties lived a lifestyle well above their means and there was little to no financial accountability during the marriage.   Plaintiff works as a therapist and her net weekly income is $759.   The defendant owns the Zentek Insurance agency and his net weekly income is $1,200.   Defendant testified that the monthly household expenses were routinely in the range of $6,000 to $7,000, and may have reached $14,000 on occasions.   Defendant's credit card debt is approximately $31,000 and plaintiff has credit card debt in the approximate amount of $19,700.   The parties accepted $51,000 in 1998 from Susan Haydu, the plaintiff's mother, to pay a portion of their credit debt.   In 2008, Ms. Haydu, at plaintiff's behest, agreed to assume an additional $10,000 worth of credit card debt from the parties.   Ms. Haydu testified that $41,000 of the $51,000 that she gave to the parties in 1998 was a loan.   She stated that a note was signed by both plaintiff and defendant acknowledging the $41,000 loan but she is unable to locate it.   A Payment Amortization Schedule was introduced into evidence containing the handwritten notations of Ms. Haydu.   The document suggests that no payments have been made on the loan since September 2002.   Despite the fact that Ms. Haydu has not been paid since 2002, in 2008 she assumed a $10,000 debt of the parties.   Since 2011, Ms. Haydu has given an additional $44,541 to the plaintiff for her attorney and expert fees.   Plaintiff has listed both the $51,000 and the $44,541 liability to Ms. Haydu on her Financial Affidavit.   The court finds that although Ms. Haydu may have originally believed the $41,000 to be a loan to the parties, by making no attempt to collect the debt since 2002 and later providing additional financial assistance to the parties, the loan was forgiven.   The court declines to enter orders with regard to monies that may be owed to Ms. Haydu.

The defendant was employed in the petroleum industry for 25 years;  his last position was with Shell Oil Company.   He was laid off in 2004 and was earning approximately $141,000 at the time.   There is a disagreement between the parties as to whether the layoff was due to day trading on his work issued computer or as a result of a down turn in the petroleum industry.   Defendant initially sought work in the petroleum industry in both California and Michigan following his lay off but was unable to find work in the field.   He ultimately decided, with the approval of the plaintiff, to purchase an insurance agency.

The defendant received approximately $100,000 in severance pay from Shell Oil at the time of his layoff.   With these funds, the defendant formed a limited liability company with himself as sole owner in 2005.   The company operates as an Allstate Insurance agency under the terms of an Exclusive Agency Agreement between Allstate Insurance Company and the defendant.   The company's revenues derive from commissions received from Allstate on new and renewed automobile and homeowner insurance policies.   Defendant's initial purchase included offices in Simsbury and East Granby.   He purchased a Manchester office in 2008 for $250,000.   Defendant subsequently closed the East Granby office at the end of August 2011, after the commencement of the dissolution action.

Both parties retained experts relative to the valuation of the insurance agency.   Although they differ on the value of the business, the experts agreed that their analysis of the business valuation was severely hampered by the lack of business records.   Specifically, defendant maintains no financial ledgers, no cash ledgers and no disbursement records.   The experts were able to review tax returns, 1099 statements issued by Allstate and defendant's checking account.   The checking account was used for both business and personal expenses.   The comingling of expenses made it difficult, if not impossible, to benchmark the business expenses.   The plaintiff's expert, James Russell, indicated that he considered, but was unable to employ the “asset-based approach to value” as the agency does not have significant financial and tangible assets.   The “income-based approach to valuation” was also considered but could not be used due to the lack of financial documents and records available.   Mr. Russell employed the “nonmarketable, controlled interest basis for valuation.”   Using this technique, Mr. Russell found the fair market value of the business to be $298,000.

The defendant's expert, John Kramer, found Mr. Russell's methodology sound but disagreed with several assumptions made by Mr. Russell.   Namely, Mr. Kramer testified that in using the market approach in his analysis, Mr. Russell failed to consider the differences between an insurance agency in a captive industry versus in the general independent industry.   Mr. Kramer indicated that because he believed there exists a significant number of restrictions as to whom the Allstate agency can be sold, he considered only Allstate Insurance's buyout figure for the value of the defendant's agency.   He ultimately testified that he believed the value of the defendant's agency to be $154,000.   The court finds the value of the Zentek Insurance Agency to be $298,000.

Since the commencement of the insurance agency in 2005, the defendant believes he liquidated approximately $225,000 to $240,000 of his retirement accounts.   The funds were deposited into the personal/Allstate Insurance agency checking account.   He no longer possesses any retirement funds.   The plaintiff believes the amount of defendant's liquidated retirement funds to be in excess of $300,000.   The plaintiff alleges that defendant's mismanagement of the insurance agency, his penchant for gambling and funds spent on his paramours all necessitated the defendant's raiding of his retirement funds.   She further claims that the use of these funds were a dissipation of assets, particularly those liquidated after February 4, 2008, the date she believes the marriage was in serious jeopardy.

Relative to the claim of dissipation, the plaintiff alleges that she had no knowledge that the defendant liquidated his retirement accounts.   She testified that her husband signed her name to an AG Edwards IRA that she owned in the amount of $11,000 in July 2007.   He put the funds into the personal/Allstate checking account.

Defendant alleges that plaintiff was aware that the agency was a “scratch business” and would require infusions of capital.   He states that plaintiff was aware that the “enhanced compensation” that he received from Allstate Insurance Company as a new owner would gradually diminish over time.   In order to save overhead costs and expenses, Mr. Zentek closed the East Granby office, renegotiated a telephone contract and reduced his personnel costs.   Defendant believes that the agency is now headed in the right direction.   Although defendant alleges his business is currently on track, he has steadfastly refused to hire an accountant to assist in organizing his business affairs and in the preparation of his tax returns.

Relative to his gambling, defendant alleges that although he enjoyed gambling, it was not to an extreme degree.   He stated that plaintiff often accompanied him on trips to the casino.   The parties attended numerous concerts both at Mohegan Sun and Atlantic City throughout their marriage.   They enjoyed meals at casino restaurants.   Although the defendant agreed that plaintiff did not gamble with him on most occasions, she readily accompanied him.   Plaintiff has visited the Connecticut casinos with friends since her separation from the defendant to enjoy concerts, dinner and shopping, although she did not gamble.

The court finds that although the plaintiff may not have actual knowledge of the manner in which defendant managed the family's financial affairs, including liquidating his entire retirement accounts, she did nothing to involve or inform herself of the family's financial status.   Defendant asked plaintiff for monies in 2008 to fund his payroll yet she failed to inquire as to the family's financial viability.   Plaintiff lived an affluent lifestyle and did not care to concern herself with the details of her husband's business, their income or how they were funding their lifestyle.   In 2007 the parties travelled to Jamaica for a family vacation for a cost of approximately $8,000;  in 2008 they travelled to Turks & Caicos for a cost of roughly $10,000;  and in 2011 they travelled to Texas to see their son play baseball for $3000 and to Marco Island for an additional $2,000 to $3,000.²  Defendant testified that his wife often made major purchases without consulting him, such as a $3,000 Persian rug and a $6,000 glass front door, both purchased in Texas.

Both parties signed the other's name to checks throughout the marriage and defendant specifically referenced an Allstate settlement check in the amount of several thousand dollars in his name signed and cashed by the plaintiff.   Mr. Zentek testified that he regularly put funds into his wife's checking account because she was often overdrawn.

Plaintiff testified that defendant was responsible for the filing of their income tax returns.   There is approximately $20,000 due to the IRS. Much, if not all of the tax liability is a result of defendant's 401K and annuity liquidation.   More specifically, when preparing his 2008 tax return, defendant misplaced the 1099 relative to liquidated retirement accounts.   He elected to file the return without reporting the liquidated retirement income.   Plaintiff claims that her tax refund in the amount of $3,795 was recently seized by the IRS due to the 2008 liability.

The marital home at 51 Wyngate Lane, Simsbury, CT sold during the pendency of the dissolution action.   The parties realized no profit from the sale of the home;  rather each had to bring a check in the amount of $3,750 to effectuate the closing.   Thereafter, defendant received a CitiMortgage Escrow Fund check in the amount of $3,125.   He signed his wife's name to the check and deposited it into his account.

Defendant seeks an educational support order relative to the parties' three children.   The eldest son, Thaddeus, is in his 7th year of college seeking to obtain his bachelor's degree.   Thaddeus has attended four different colleges throughout the years, including Northeastern and Lamar University.   He is currently enrolled at the University of Hartford.   The plaintiff signed a Parent Plus loan for Thaddeus in the amount of $29,569 in 2007.   Although the loan is in plaintiff's name, the defendant acknowledges his liability for half the amount of the loan.   Eric flunked out of Central Connecticut State University in December 2012.   He is currently enrolled at Tunxis Community College.   Blair graduated from high school in June 2012 with a 1.64 grade point average.   He also is enrolled at Tunxis.   The court finds that Thaddeus is not entitled to an educational support order.   Pursuant to § 46b–56c an educational support order is an order for support for a child “to attend for up to a total of four full academic years an institution of higher learning.”   As stated, Thaddeus is in his 7th year of college.   The court declines to enter an educational support order relative to Eric and Blair until such time as they “maintain good academic standing” and fulfill the other requirements of subsection (e) of § 46b–56c.

The court finds that the cause for the breakdown of the marriage lies with the defendant, Thaddeus Zentek.   The marriage would have continued in its state of financial irresponsibility and debt had it not been for the adulterous affairs of the defendant and the resulting distrust and lack of communication he created in the marriage.   The court finds the fair market value of defendant's insurance agency to be $298,000.   The business was acquired during the marriage and is deemed a marital asset.   Plaintiff also seeks an award of alimony.   The court is mindful that defendant's sole source of income is the revenue derived from his insurance agency.   The court finds that it would be inequitable to award plaintiff one-half of the value of the business and alimony derived from that business.

Relative to the plaintiff's claim of a dissipation of marital assets, “Generally, dissipation is intended to address the situation in which one spouse conceals, conveys or wastes marital assets in anticipation of a divorce ․ “[A] trial court should consider preseparation dissipation of marital assets, so long as the actions constituting dissipation occur either:  (1) in contemplation of divorce or separation;  or (2) while the marriage is in serious jeopardy or is undergoing an irretrievable breakdown.”  Finan v. Finan, 287 Conn. 491, 493 (2008).  “Courts have traditionally recognized dissipation in the following paradigmatic contexts:  gambling, support of a paramour, or the transfer of an asset to a third party for little or no consideration.”  (Citation omitted).  Gershman v. Gershman, 286 Conn. 341, 346 (2008).   The court finds that although defendant did expend marital funds on his paramours, the amount was insignificant.   The gambling activities of the defendant were undertaken during the course of the marriage and not in anticipation of the couple's divorce or separation.   Plaintiff was aware of defendant's gambling activity and often accompanied him on his outings.   Lastly, the court finds that defendant's liquidation of his retirement accounts pre- and post-dated the date that plaintiff believed her marriage was in serious jeopardy.   The liquidation of the retirement assets was to support the family's lifestyle.   The court declines to find that the defendant dissipated marital funds.

ORDERS

1. Dissolution:  The marriage of the parties is dissolved on the grounds of irretrievable breakdown.   The parties are declared single and unmarried.

2. Child Support:  The court finds a child support arrearage of $1,205 as of October 4, 2013.   The plaintiff shall pay to defendant the amount of $25 per week until the child support arrearage has been paid in full.

3. Alimony:  The court makes no alimony orders.

4. Health Insurance:  Plaintiff and defendant shall maintain their own health insurance at their own cost.   The plaintiff shall continue to maintain health insurance for the benefit of her children so long as they remain eligible, and if available through her employment at a reasonable cost.

5. Tax Filings:  (a) To the extent that the parties' children are eligible to be claimed as dependents for federal and state income tax purposes, the defendant shall claim them as dependents;  (b) defendant shall be solely responsible for the tax liability owed to the IRS In the approximate amount of $21,000;  and (c) defendant shall pay to plaintiff $3,795, representing the tax refund seized by the IRS, within 6 months of the date of judgment.

6. Business:  The court awards plaintiff one-half the value of the Zentek Insurance agency, or $149,000.   Defendant shall pay the $149,000 to plaintiff in weekly payments of $500 for the period of 298 weeks.   The court shall retain jurisdiction over the insurance agency for the purpose of enforcing and effectuating this order.

7. Vehicles:  Each party shall retain the vehicles currently in their possession free and clear of the other party.   They shall each assume all financial responsibilities associated with their respective vehicles and shall indemnify and hold harmless the other party from any liability therefrom.

8. Deferred Compensation Plans:  The plaintiff shall retain for her sole benefit the Sage Point and Mutual of America 403B plans listed on her financial affidavit.

9. Bank Accounts:  The parties shall retain for their sole benefit any monies in their respective bank accounts.

10. Cancelled Life Insurance Policy:  The court, Prestley, entered an order on July 10, 2013 requiring the defendant to value a life insurance policy and provide the valuation to plaintiff's counsel and pay one-half the value to plaintiff.   The defendant has not complied with the order.   The defendant, within 60 days from the date of judgment, shall provide the valuation information to plaintiff's counsel and pay one-half the value of the policy to the plaintiff within 90 days of the judgment.

11. Home Escrow Fund:  The defendant shall pay to plaintiff the amount of $1,562 representing one-half of the CitiMortgage Escrow Fund check that he deposited into his own account without plaintiff's knowledge.   Defendant shall make this payment within 90 days of the judgment.

12. College Expense:  The court shall retain jurisdiction over the postmajority education of Eric and Blair.

13. Student Loan:  The plaintiff and defendant shall each be responsible for one-half of the student loan in the approximate amount of $30,000 for the benefit of Thaddeus, Jr.

14. Liabilities:  Unless specified herein, each party shall be liable for his or her individual debts as set forth in his/her financial affidavit.

15. Counsel Fees:  Each party shall pay their own respective counsel fees.

Unless otherwise specifically set forth herein, these orders are effective immediately.

SO ORDERED

BY THE COURT,

Ficeto, J.

FOOTNOTES

FN1. The court, Carbonneau, J., ordered child support in the amount of $160 per week on March 27, 2012.   The child reached the age of majority during the pendency of the litigation..  FN1. The court, Carbonneau, J., ordered child support in the amount of $160 per week on March 27, 2012.   The child reached the age of majority during the pendency of the litigation.

FN2. The Marco Island trip was an award from Allstate but the parties chose to bring the entire family thus incurring the additional expense..  FN2. The Marco Island trip was an award from Allstate but the parties chose to bring the entire family thus incurring the additional expense.

Ficeto, Anna M., J.