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Supreme Court, Appellate Division, Third Department, New York.

Thomas CHIOTTI, Respondent-Appellant, v. Susan CHIOTTI, Appellant-Respondent.

Decided: November 24, 2004

Before:  SPAIN, J.P., CARPINELLO, MUGGLIN, ROSE and KANE, JJ. Joch & Kirby, Ithaca (Susan C. Kirby of counsel), for appellant-respondent. Holmberg, Galbraith, Van Houten & Miller, Ithaca (Dirk A. Galbraith of counsel), for respondent-appellant.

Cross appeals from a judgment of the Supreme Court (Relihan Jr., J.), entered January 29, 2004 in Tompkins County, ordering, inter alia, equitable distribution of the parties' marital property, upon a decision of the court.

The parties to this action were married for approximately 28 years when plaintiff commenced this action for divorce in May 2002.   After the parties stipulated to a divorce, a bench trial was held to resolve issues of equitable distribution and child support for the remaining unemancipated child.   On this appeal, defendant claims that Supreme Court failed to properly classify as separate property certain accounts titled in her name alone, failed to properly distribute the parties' respective pensions, failed to equitably divide responsibility for the payment of the child's college expenses, miscalculated child support, failed to require plaintiff to provide life insurance to protect child support payments, and failed to require plaintiff to contribute to the payment of marital obligations which defendant had paid during the pendency of the action.   Plaintiff cross-appeals, contending that Supreme Court misclassified an account in his name alone as a marital asset and erred in failing to credit plaintiff's college tuition payment against his child support obligation.

 Initially, “[i]t is well settled that property acquired by one spouse as a gift or by inheritance during a marriage and retained separately is not marital property” (Allen v. Allen, 263 A.D.2d 691, 692, 693 N.Y.S.2d 708 [1999];  see Strang v. Strang, 222 A.D.2d 975, 976-977, 635 N.Y.S.2d 786 [1995] ).   However, separate property which is commingled with marital property or is subsequently titled in the joint names of the spouses is presumed to be marital property (see Rosenkranse v. Rosenkranse, 290 A.D.2d 685, 686, 736 N.Y.S.2d 453 [2002] ).   Applying these rules, we find that all accounts titled in defendant's name should have been classified as her separate property.   The undisputed evidence is that the source of each of these accounts was either a gift from her father or an inheritance.   Further, there is no evidence that these funds were either commingled with marital property or placed in the joint names of the parties.   Defendant's inability to produce a complete paper trail from gift or inheritance to trial does not require a contrary finding, particularly as there is no evidence suggesting other possible sources of the accounts and plaintiff failed to proffer any evidence which would contradict defendant's testimony in this regard (see Zanger v. Zanger, 1 A.D.3d 865, 866-867, 767 N.Y.S.2d 489 [2003];  Allen v. Allen, supra at 692, 693 N.Y.S.2d 708;  cf. Cassara v. Cassara, 1 A.D.3d 817, 819, 767 N.Y.S.2d 492 [2003] ).   On the other hand, plaintiff admitted that marital funds had been commingled with his originally separate Vanguard Mutual Healthcare Fund. This fund then became a marital asset subject to equitable distribution.   Once converted, the property does not resume its status as separate property, even if all the marital funds are removed from the account (see Judson v. Judson, 255 A.D.2d 656, 657, 679 N.Y.S.2d 465 [1998] ).

 Next, we find no reason to disturb Supreme Court's decision with respect to the parties' pensions.   Distribution of pensions must be equitable after the consideration of numerous factors, including the parties' incomes and property acquired during the marriage, the length of the marriage, their ages and health status, and tax consequences (see King v. King, 258 A.D.2d 717, 718-719, 684 N.Y.S.2d 684 [1999] ).   Although Supreme Court may have been motivated to make its distribution by simplicity, not a pertinent factor, our review of the record suggests that consideration of the appropriate factors supports the distribution, particularly in view of the respective separate property holdings (see Munson v. Munson, 250 A.D.2d 1004, 672 N.Y.S.2d 968 [1998] ) and the continued employment of defendant and the retirement of plaintiff (see Butler v. Butler, 256 A.D.2d 1041, 1045, 683 N.Y.S.2d 603 [1998], lv. denied 93 N.Y.2d 805, 689 N.Y.S.2d 429, 711 N.E.2d 643 [1999] ).

 Defendant challenges the child support award contending that plaintiff's retirement from the work force was voluntary, designed simply to limit his responsibility to the child.   In view of plaintiff's undisputed health problems and the early retirement incentive package afforded by plaintiff's employer, we find no abuse of discretion in Supreme Court's calculation of child support based on plaintiff's present retirement income (cf. Fendsack v. Fendsack, 290 A.D.2d 682, 683, 736 N.Y.S.2d 457 [2002] ).   Further, given the short duration of child support and the absence of any specific request by defendant for a protective life insurance policy in her proposed statement of disposition, we find that this argument lacks merit (see Holterman v. Holterman, 307 A.D.2d 442, 442-443, 762 N.Y.S.2d 152 [2003], affd. 3 N.Y.3d 1, 781 N.Y.S.2d 458, 814 N.E.2d 765 [2004] ).

 Next, we have examined the parties' complaints concerning the division of the child's college expenses and Supreme Court's refusal to grant plaintiff a credit for tuition payments against his child support obligation and find no abuse of discretion on Supreme Court's part.   These expenses were fairly divided between the parties, especially in view of the award of full child support (see Houck v. Houck, 246 A.D.2d 905, 906, 667 N.Y.S.2d 824 [1998];  Paro v. Paro, 215 A.D.2d 965, 965-966, 627 N.Y.S.2d 465 [1995] ).

 Last, we do find merit in defendant's contention that Supreme Court erred in failing to credit her for expenditures on joint obligations during the pendency of the divorce action (see King v. King, supra at 718, 684 N.Y.S.2d 684).   Defendant paid joint expenses which included $1,673 for a credit card bill, $26 for a satellite television bill, $95 for a phone bill, $1,359 for a car insurance bill, and $2,468 in home repairs.   In addition, plaintiff withdrew $10,000 from a joint account to pay his attorney in this action.   Defendant is entitled to credit for 50% of these sums.   Conversely, plaintiff's claim that he is entitled to a similar credit for $6,300 that defendant withdrew from a joint account is without merit, since defendant used this money to pay for the child's college expenses (see Spenello v. Spenello, 274 A.D.2d 822, 825, 710 N.Y.S.2d 478 [2000];  Maczek v. Maczek, 248 A.D.2d 835, 837, 669 N.Y.S.2d 749 [1998] ).

ORDERED that the judgment is modified, on the law, without costs, by reversing so much thereof as classified accounts held in defendant's sole name as marital, declined to credit defendant for expenditures on joint obligations incurred during the pendency of the action and declined to credit defendant for plaintiff's withdrawal from a joint account for counsel fees;  direct said accounts held in defendant's sole name be classified as separate property, credit defendant for 50% of expenditures on certain specified joint obligations and credit defendant $5,000 withdrawn by plaintiff for his counsel fees;  and, as so modified, affirmed.



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