Hobyak, L. v. Hobyak, M. ( 2016 )

J. A15023/16
NON-PRECEDENTIAL DECISION – SEE SUPERIOR COURT I.O.P. 65.37
LISA PAIGE HELMKAMP HOBYAK, : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
Appellant :
:
v. : No. 1643 EDA 2015
:
MICHAEL SCOTT HOBYAK :
Appeal from the Order, April 28, 2015,
in the Court of Common Pleas of Delaware County
Civil Division at No. 93-08569
LISA PAIGE HELMKAMP HOBYAK : IN THE SUPERIOR COURT OF
: PENNSYLVANIA
v. :
:
MICHAEL SCOTT HOBYAK, : No. 1739 EDA 2015
:
Appellant :
Appeal from the Order, April 28, 2015,
in the Court of Common Pleas of Delaware County
Civil Division at No. 93-08569
BEFORE: FORD ELLIOTT, P.J.E., PANELLA AND FITZGERALD,* JJ.
MEMORANDUM BY FORD ELLIOTT, P.J.E.: FILED OCTOBER 04, 2016
Lisa Paige Helmkamp Hobyak (“Wife”) and Michael Scott Hobyak
(“Husband”) each appeal from the trial court’s March 6, 2015 amended
equitable distribution order, as made final by the entry of a divorce decree
on April 28, 2015. After careful review, we affirm on the basis of the
* Former Justice specially assigned to the Superior Court.
J. A15023/16
comprehensive and well-reasoned Pa.R.A.P. 1925(a) opinions of the
Honorable John L. Braxton.
The trial court summarized the relevant facts and procedural history of
this case as follows:
[Wife] and [Husband] were married on
April 16, 1983. On or about June 14, 1993, Wife
filed a Complaint in Divorce; however, thereafter,
the parties reconciled until their ultimate separation
on January 2, 2004. From 2004 until 2011, multiple
petitions and appeals were filed including petitions
related to the following: injunctive relief, discovery
issue resolution, contempt allegations, special relief
requests, conference requests, requests to relist, and
multiple appeals to the Superior Court. On or about
September 6, 2011, the Honorable Kathrynne
Durham issued an Order after a hearing Ordering
that “if [there is] an appeal from the
recommendation of the hearing officer, Donald
Lehrkinder, Esquire, the appeal will be assigned to
the Honorable John L. Braxton.”
Thereafter the Equitable Distribution hearing
officer, Master Lehrkinder[,] issued a
recommendation which was signed as an Order of
Court and thereafter appealed on September 20,
2011 upon [Wife’s] Request for a hearing de novo.
A hearing was scheduled before the Honorable
John L. Braxton for January 4, 2012. At the hearing,
Stipulations of the Parties (hereafter “the
Stipulation”) were presented to the Trial Court and a
Court Order was entered thereafter on January 10,
2012, entering the Stipulation as an Order of Court.
The Stipulation contained background information of
the parties, including Wife’s W-2 information for the
years 2007-2010, Husband’s gross and net income
for 2002-2011, the parties’ marriage information,
stipulated values of certain marital assets, the
parties’ agreed upon separate assets, and certain
information relative to Wife’s support claim.
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At the hearing, both parties’ waived their right
to present live testimony, choosing instead, “to
proceed by colloquy with the Court where I [Counsel
for Husband] state our position with regard to
various positions, Ms. Casale [Counsel for Wife]
states the position of [Wife], and the Judge then if
he has any questions of either of us [counsel] or you
[Husband] and [Wife] will do it in a manner without
you getting on the witness stand and testifying.”
Both parties responded on the record that they
understood and agreed to the procedure as outlined
by their counsel. Importantly, this was a scheme
developed and agreed to exclusively by the parties.
The [trial c]ourt permitted counsel to try the case as
they [chose] to do and accepted counsel’s
summation of testimony and evidence, as the parties
mutually agreed on how to procedurally advance at
trial.
Counsel likewise jointly agreed to supplement
the record post-hearing by agreeing on the record to
submit various proofs and items. Counsel agreed to
submit certain items and proofs directly to the Trial
Court in lieu of presenting testimony and evidence
during the Trial Court proceeding. Both parties were
fully cognizant that the Trial Court would be
considering post-trial submissions in rendering an
Equitable Distribution Order, this again being a joint
decision by the parties. Indeed, the parties’
requested the Trial Court to consider post-trial
submissions and such submissions, although
available to each other for review, were never
objected to in written form or otherwise.
Importantly, both counsel had abundant opportunity
to review the hefty submissions and make objections
as the Equitable Distribution Order was not issued
until November 25, 2013.
On or about January 2, 2014, Wife, by and
through her counsel, filed a Motion for
Reconsideration of the November 25, 2013 Order.
On or about July 14, 2014, the Trial Court held a
hearing on Wife's Motion for Reconsideration and
Husband’s response thereto. After the July 14, 2014
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hearing, the Trial Court found sufficient grounds to
reconsider portions of the November 25, 2013 Order,
although specifically refusing to rehear the case in its
entirety as Wife requested. Wife was, however,
granted an additional hearing with respect to a
certain parcel of property, 3805-A Otter Street,
Bristol, Pennsylvania (hereafter “3805-A Otter
Street”)[,] which Wife contended was an asset never
before disclosed to her. A full and fair hearing on
the limited issue of 3805-A Otter Street occurred on
January 7, 2015.
On or about March 6, 2015, the Trial Court
entered an Amended Equitable Distribution Order,
which corrected certain valuations that were
inconsistent with the Stipulation (although consistent
with certain of the parties’ post-trial submissions),
modified the November 25, 2013 Order based upon
the parties’ joint representation that the Stipulation
erroneously contained the incorrect number of
shares of Bancorp stock, and furthermore found
3805-A Otter Street to be a pre-marital asset with a
de minimus increase in value based upon its
assessment and the landlocked nature of the parcel
at issue.
Trial court opinion, 9/18/15 at 2-5 (No. 1643 EDA 2015) (citations to notes
of testimony and footnotes omitted; some bracketed information in original).
On April 28, 2015, the trial court entered a decree in divorce, which
made final its March 6, 2015 amended equitable distribution order. On
May 26, 2015, Wife filed a timely notice of appeal, and Husband filed a
timely cross-appeal on June 8, 2015. Both parties complied with the trial
court’s directive and filed timely concise statements of errors complained of
on appeal, in accordance with Pa.R.A.P. 1925(b). Thereafter, on
September 22, 2015, the trial court filed separate Rule 1925(a) opinions
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addressing each party’s claims. (See id.; trial court opinion, 9/22/15
(No. 1739 EDA 2015).)
Our standard of review of awards of equitable distribution is well
settled:
A trial court has broad discretion when
fashioning an award of equitable distribution. Our
standard of review when assessing the propriety of
an order effectuating the equitable distribution of
marital property is whether the trial court abused its
discretion by a misapplication of the law or failure to
follow proper legal procedure. We do not lightly find
an abuse of discretion, which requires a showing of
clear and convincing evidence. This Court will not
find an abuse of discretion unless the law has been
overridden or misapplied or the judgment exercised
was manifestly unreasonable, or the result of
partiality, prejudice, bias, or ill will, as shown by the
evidence in the certified record. In determining the
propriety of an equitable distribution award, courts
must consider the distribution scheme as a whole.
We measure the circumstances of the case against
the objective of effectuating economic justice
between the parties and achieving a just
determination of their property rights.
Reber v. Reiss, 42 A.3d 1131, 1134 (Pa.Super. 2012), appeal denied, 62
A.3d 380 (Pa. 2012), citing Biese v. Biese, 979 A.2d 892, 895 (Pa.Super.
2009).
In fashioning an equitable distribution award, the trial court is required
to consider, at the very least, the enumerated factors set forth in
23 Pa.C.S.A. § 3502(a)(1)-(11). However, this court has noted that,
[t]here is no simple formula by which to divide
marital property. The method of distribution derives
from the facts of the individual case. The list of
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factors [enumerated in Section 3502(a)] serves as a
guideline for consideration, although the list is
neither exhaustive nor specific as to the weight to be
given the various factors. Thus, the court has
flexibility of method and concomitantly assumes
responsibility in rendering its decisions.
Wang v. Feng, 888 A.2d 882, 888 (Pa.Super. 2005) (citations omitted).
Instantly, Wife raises 11 multi-layered issues in her 77-page appellate
brief to this court. (See Wife’s brief at 13-16.) Wife’s Rule 1925(b)
statement, in turn, raises 20 claims of error, some of which have not been
briefed on appeal. After a thorough review of the record, including the briefs
of the parties and the applicable law, and in light of this court’s scope and
standard of review, it is our determination that there is no merit to the
issues Wife raises on appeal. We conclude that the trial court’s
September 22, 2015 opinion authored in response to Wife’s Rule 1925(b)
statement comprehensively discusses and disposes of each of her claims.
(See trial court opinion, 9/22/15 (No. 1643 EDA 2015).) For the ease of our
discussion, we have set forth the applicable pages of the trial court’s opinion
where each of these claims is addressed, and adopt those portions as our
own for purposes of this appellate review.
1. Did the Trial Court abuse its discretion
and misapply the law when it evenly
divided the marital estate given the length
of the marriage, the tremendous disparity
in income between the parties, and the
disparities between the separate, non-
marital estates of the parties?
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Wife’s brief at 13, 45 (emphasis added); addressed in trial court opinion,
9/22/15 at 9-11 (No. 1643 EDA 2015).
2. Did the Trial Court abuse its discretion
and misapply the law when it ignored the
stipulated earnings history of Wife, and
found that, at the time of the hearing,
Wife was employed by Hope Paige
Designs, Inc., and held an interest in Hope
Paige Designs, Inc. when, at the time of
the hearing, Wife was never a
shareholder, officer, director, or partner
of Hope Paige Designs, Inc., and was
otherwise unemployed?
Wife’s brief at 13, 51 (emphasis added); addressed in trial court opinion,
9/22/15 at 9-11 (No. 1643 EDA 2015).
3. Did the Trial Court commit an abuse of
discretion, misapply the law, and fail to
follow proper legal procedure when it
determined Husband’s earnings and
future earning capacity when it did not
consider, as set forth in the Stipulation of
the Parties, Husband’s 2009 income of
$1,690,000.24 and Husband’s 2011
income of $2,668,109.00, and when it
ignored the credible evidence regarding
Husband’s ability to receive future
bonuses from the business, ignored the
fact that Husband was running the
business, and ignored the fact that,
pursuant to a May 6, 2010 agreement
with [his] father, Husband has full control
and authority over the business?
Wife’s brief at 13-14, 53 (emphasis added); addressed in trial court opinion,
9/22/15 at 11 (No. 1643 EDA 2015).
4. Did the Trial Court abuse discretion and
misapply the law when it accepted and
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permitted Husband to claim 3803 Otter
Street was pre-marital property, where,
throughout the litigation and until the day
before trial, Husband represented that it
was marital property, and when it ignored
the stipulated increase in value of 3803
Otter Street when Husband presented no
credible evidence to establish the value at
the time of the gift?
Wife’s brief at 14, 56 (emphasis added); addressed in trial court opinion,
9/22/15 at 11-12 (No. 1643 EDA 2015).
5. Did the Trial Court commit an abuse of
discretion and misapply the law when it
ignored the sworn testimony of Wife’s
expert appraiser as to the value 3805
Otter Street, and imposed upon Wife the
duty to present evidence of the alleged
value of the gift of 3805 Otter Street to
Husband?
Wife’s brief at 14, 58 (emphasis added); addressed in trial court opinion,
9/22/15 at 12-13 (No. 1643 EDA 2015).
6. Did the Trial Court commit an abuse of
discretion and misapply the law when it
ignored the New Jersey litigation between
the parties involving Rycoja, maintained
the parties’ status and interest as
partners in Rycoja, and credited the
Husband with $85,734.00 he paid in taxes
on the management fees he improperly
received from Rycoja, which he was
ordered to repay by the New Jersey Court,
thereby not providing for an equitable
distribution of all marital property and
leaving the parties involved in continuing
litigation?
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Wife’s brief at 14-15, 60 (emphasis added); addressed in trial court opinion,
9/22/15 at 13-14 (No. 1643 EDA 2015); see also trial court opinion,
9/22/15 at 7-8 (No. 1739 EDA 2015).
7. Did the Trial Court commit an abuse of
discretion and misapply the law when
after the Trial Court granted Wife’s Motion
for Reconsideration, the Trial Court did
not permit the parties to introduce
updated appraisals and evidence
regarding the value of and the
depreciation of debt encumbering
appreciating martial assets, such as
inter alia Rycoja, 3803 Otter Street, and
the Dreyfus IRA, which all appreciated in
value between the date of the hearing, in
January 2012 and the Court’s Amended
Equitable Distribution Order, entered
March 6, 2015?
Wife’s brief at 15, 65 (emphasis added); addressed in trial court opinion,
9/22/15 at 14 (No. 1643 EDA 2015).
8. Did the Trial Court commit an abuse of
discretion and misapply the law by not
including the cash value of the Lincoln
Benefit Life Insurance policy in the
marital estate where the life insurance
trust created by Husband had expired,
thereby making him the owner of the life
insurance, and where, until the eve of
trial, Husband had represented that the
cash value was included in the marital
estate?
Wife’s brief at 15, 67 (emphasis added); addressed in trial court opinion,
9/22/15 at 16 (No. 1643 EDA 2015).
9. Did the Trial Court commit an abuse of
discretion and misapply the law when it
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credited Husband for (i) repairs to the
marital home where there was no
evidence to prove that Husband, and not
his Company, paid for the repairs and
issued payment for those repairs from his
personal accounts; (ii) credited Husband
for voluntary post-separation payments to
Wife consisting gifts and expense
payments, and (iii) failed to provide Wife
with 100% credit for payments she made
for repairs and maintenance of the marital
home?
Wife’s brief at 15-16, 69 (emphasis added); addressed in trial court opinion,
9/22/15 at 17 (No. 1643 EDA 2015).1
10. Did the Trial Court commit an abuse
discretion and misapply the law when it
refused to consider post-separation,
marital estate distributions totaling
$91,000.00 that Husband received from
Second Generation, which were
specifically excluded from income for
support and alimony pendente lite
purposes and, therefore, should have
been considered at the time equitable
distribution?
Wife’s brief at 16, 71 (emphasis added); addressed in trial court opinion,
9/22/15 at 18 (No. 1643 EDA 2015).
1
We note that there is a typo on page 17, line 19 of the trial court’s
September 22, 2015 opinion, wherein the trial court inadvertently replaced
the word “Appellee” (Husband) with “Appellant” (Wife). (See trial court
opinion, 9/22/15 at 17 (No. 1643 EDA 2015).) It is apparent from the
context that this sentence should properly read: “Appellee (Husband),
however, produced credible evidence that he did not actually receive the
entire amount due to tax liabilities amounting to $85,734.00.” (Id.)
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Additionally, Wife raises the following issue with respect to Husband’s
claims on cross-appeal:
11. Did the Trial Court abuse its discretion,
misapply the law, and fail to follow proper
legal procedure when after the trial in this
matter, the Trial Court granted Wife’s
Motion for Reconsideration?
Wife’s brief at 16, 73 (emphasis added).
Husband, in turn, raises the following issues in his cross-appeal:
1. Whether the Trial Court erred as a matter of
law in issuing an equitable distribution order on
March [6], 2015 when it never issued an Order
granting reconsideration within thirty (30) days
of the original equitable distribution Order of
November 23, 2013, which would make the
aforementioned Order a final, unappealed
Order of Court Pursuant to Pennsylvania Rule
of Civil Procedure 1930.2?
2. Whether the Trial Court erred as a matter of
law in issuing an equitable distribution order on
March [6], 2015 when more than one hundred
and twenty (120) days had expired since the
time in which the Court could have issued an
Order granting reconsideration, that being
May 6, 2014, which would make the
aforementioned Order a final, unappealed
Order of Court Pursuant to Pennsylvania Rule
of Civil Procedure 1930.2?
Husband’s brief at 15.
The trial court filed an opinion with regard to Husband’s cross-appeal
wherein it comprehensively discusses and disposes of these claims, with
appropriate reference to the record and without legal error. (See trial court
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opinion, 9/22/15 at 6 (No. 1739 EDA 2015).) Upon review, we affirm on the
basis of that opinion as well for purposes of this appellate review.
Accordingly, for all the foregoing reasons, we affirm the trial court’s
March 6, 2015 amended order of equitable distribution, made final by the
April 28, 2015 divorce decree.
Order affirmed.
Judgment Entered.
Joseph D. Seletyn, Esq.
Prothonotary
Date: 10/4/2016
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Circulated 09/09/2016 11:24 AM
IN THE COURT OF COMMON PLEAS OF DELAWARE COUNTY,
PENNSYLVANIA
CIVIL ACTION - LAW
LISAP.HOBYAK
Plaintiff/ Appellant, Trial Court No.: 1993-8569
v. Superior Court No.: 1643 EDA 2015
MICHAELS. HOBYAK IN DIVORCE
Defendant/ Appellee.
Bernard E. Zbrezeznj, Esquire for the Plaintiff/Appellant
200 Four Falls Corporate Center, Suite 400; West Conshohocken, PA 19428
David E. Auerbach; Esquire for the Defendant/ Appellee
3 44 West Front Street; Media, PA 19063
OPINION
BRAXTON,J. Date: September 18, 2015
This is an appeal from an Equitable Distribution Order dated March 6, 2015, which
amended the Equitable Distribution Order dated November 25, 2013 after reconsideration was
granted. A Divorce Decree was entered April 28, 2015 thereby transforming the March 6, 2015
Order (hereafter "the Equitable Distribution Order") into a final appealable Order. Lisa P.
Hobyak (hereafter "Wife" or "Appellant") timely filed an appeal on May 26, 2015. Appellant
timely complied with the Trial Court's 1925(b) Order and filed a Concise Statement of Matters
Complained of on Appeal. On appeal, Appellant contends that the Trial Court abused its
discretion and committed errors of law when: permitting the parties to submit "post-hearing"
memorandum, allowing the attorneys' (who colloquyed their clients' on record) to make
representations to the court in lieu of direct testimony, making errors with respect to both parties'
earnings, finding certain property to be pre-marital, giving the parties the option to continue to
1
operate the business or participate in a buy-out or sale on the open market, crediting Appellee
with certain taxes paid on income and received as management fees, not allowing the parties' the
option to submit updated appraisals of marital debt and assets but limiting what portions of the
Order entered November 25, 2013 would be reconsidered, using the March 31, 2009 value
submitted by the parties for purposes of valuing the Dreyfus IRA, utilizing a blue book value as
opposed to the trade-in price for Wife's vehicle, not including the cash value of the Life
insurance policy in the marital estate, utilizing evidence submitted by Appellee with respect to
value of Hobyak LLP, awarding certain credits, and failing to take into account post-separation
marital estate distributions.
For the reasons as set forth below, Appellant's contentions are without merit.
FACTUAL AND PROCEDURAL ·msTORY
Appellant and Appellee were married on April 16, 1983. On or about June 14, 1993,
Wife filed a Complaint in Divorce; however, thereafter, the parties reconciled until their ultimate
separation on January 2, 2004. From 2004 until 2011, multiple petitions and appeals were filed
including petitions related to the following: injunctive relief, discovery issue resolution,
contempt allegations, special relief requests, conference requests, requests to relist, and multiple
appeals to the Superior Court. On or about September 6, 2011, the Honorable Kathyrnanne
Durham issued an Order after a hearing Ordering that "if an appeal from the recommendation of
the hearing officer, Donald Lehrkinder, Esquire, the appeal will be assigned to the Honorable
John L. Braxton."
Thereafter the Equitable Distribution hearing officer, Master Lehrkinder issued a
recommendation which was signed as an Order of Court and thereafter appealed on September
20, 2011 upon Appellant's Request for a hearing de nova. A hearing was scheduled before the
2
Honorable John L. Braxton for January 4, 2012. At the hearing, Stipulations of the Parties
(hereafter "the Stipulation") were presented to the Trial Court and a Court Order was entered
thereafter on January 10, 2012, entering the Stipulation as an Order of Court. The Stipulation
contained background information of the parties, including Wife's W-2 information for the years
2007-2010, Husband's gross and net income for 2002-2011, the parties' marriage information,
stipulated values of certain marital assets, the parties' agreed upon separate assets, and certain
information relative to Wife's support claim.
At the hearing, both parties' waived their right to present live testimony, choosing
instead, "to proceed by colloquy with the Court where I [Counsel for Husband] state our position
with regard to various positions, Ms. Casale [Counsel for Wife] states the position of Lisa
[Appellant], and the Judge then if he has any questions of either of us [ counsel] or you
(Appellee] and Lisa [Appellant] will do it in a manner without you getting on the witness stand
and testifying." (N.T. 1/4/2012, at p. 6). Both parties responded on the record that they
understood and agreed to the procedure as outlined by their counsel. (N.T. 1/4/2012, at p. 6, 8).
Importantly, this was a scheme developed and agreed to exclusively by the parties.1 The Court
1
Mr. Auerbach (counsel for Husband): "Michael, you understand that you have a right to a hearing with testimony,
both of yourself, experts with regard to various issues involved with the case. You understand that in order to try to
have the matter resolved as quickly as possible that we have agreed to proceed by colloquy with the Court where I
state our position with regard to various positions, Ms. Casale [Wife's counsel] states the position of Lisa, and the
Judge then ifhe has any questions of either of us or of you and Lisa will do it in a manner without you getting on the
witness stand and testifying. Do you understand that's the procedure we've discussed and we're going to proceed in
that manner.
Michael Hobyak: I believe I understand that yes."
Mr. Auerbach: And are you satisfied to do it in that manner?
Michael Hobayk: I run.
The Court: The Court will accept his admission.
Ms. Casale (Counsel for Wife): You understand that what we have agreed to do today is allow Mr. Auerback and I
to summarize what you would actually testify to, understand?
Lisa Paige Hobyak: Yes.
Ms. Casale: And that you are trusting that I will be able to recite the information that you testify about accurately,
you understand?
Ms. Hobyak: Yes. (N.T. 1/4/2012, at p. 6-8).
3
permitted counsel to try the case as they choose to do and accepted counsel's summation of
testimony and evidence, as the parties mutually agreed on how to procedurally advance at trial.
Counsel likewise jointly agreed to supplement the record post-hearing by agreeing on the
record to submit various proofs and items. Counsel agreed to submit certain items and proofs
directly to the Trial Court in lieu of presenting testimony and evidence during the Trial Court
proceeding' Both parties were fully cognizant that the Trial Court would be considering post-
trial submissions in rendering an Equitable Distribution Order, this again being a joint decision
by the parties. Indeed, the parties' requested the Trial Court to consider post-trial submissions
and such submissions, although available to each other for review, were never objected to in
written form or otherwise. Importantly, both counsel had abundant opportunity to review the
hefty submissions and make objections as the Equitable Distribution Order was not issued until
November 25, 2013.
On or about January 2, 2014, Wife, by and through her counsel, filed a Motion for
Reconsideration of the November 25, 2013 Order. On or about July 14, 2014, the Trial Court
held a hearing on Wife's Motion for Reconsideration and Husband's response thereto. After the
July 14, 2014 hearing, the Trial Court found sufficient grounds to reconsider portions of the
November 25, 2013 Order, although specifically refusing to rehear the case in its entirety as
Wife requested. Wife was, however, granted an additional hearing with respect to a certain
parcel of property, 3805-A Otter Street, Bristol, Pennsylvania (hereafter "3805-A Otter Street")
which Wife contended was an asset never before disclosed to her. A full and fair hearing on the
limited issue of 3805-A Otter Street occurred on January 7, 2015.
2
Mr. Auerbach: There are various credits on both sides that are disputed with regard to it. What we're suggesting
that we will submit them to the Court of the various arguments as part of it rather than go through them now." (N.T.
1/4/2012, at p. 196)
4
On or about March 6, 2015, the Trial Court entered an Amended Equitable Distribution
Order, which corrected certain valuations that were inconsistent with the Stipulation (although
consistent with certain of the parties' post-trial submissions), modified the November 25, 2013
Order based upon the parties' joint representation that the Stipulation erroneously contained the
incorrect number of shares of Bancorp stock, and furthermore found 3805-A Otter Street to be a
pre-marital asset with a de minimus increase in value based upon its assessment and the land-
locked nature of the parcel at issue.
On or about April 28, 2015, a Divorce Decree was entered and on or about May 26, 2015,
Appellant filed an appeal raising the following for consideration:
I. While the Trial Court ordered the parties to submit "post-hearing"
memoranda, the Trial Court did not order, and the parties did not
agree, to the submission of additional, newly discovered evidence, and
in accepting and considering the additional newly-discovered
evidence, the Trial Court abused its discretion;misapplied the law, and
failed to follow proper legal procedure.
2. Further, the Trial Court abused its discretion, misapplied the law, and
failed to follow proper legal procedure when it denied the parties the
right to cross-examine the witnesses regarding the newly presented
evidence submitted in the "post-hearing" memoranda.
3. The Trial Court abused its discretion and misapplied the law when it
evenly divided the marital estate given the length of the marriage, the
tremendous disparity in income between the parties, and the disparities
between the separate, non-marital estates of the parties.
4. The Trial Court committed an abuse of discretion and misapplied the
law when it ignored the stipulated earning history of Wife, and found
that, at the time of the hearing, Wife was employed by Hope Paige
Designs, Inc., and held and interest in Hope Paige Designs, Inc. when,
at the time of the hearing, Wife was never a shareholder, officer,
director, or partner of Hope Paige Designs, Inc., and was otherwise
employed.
5
5. The Trial Court committed an abuse of discretion, misapplied the law,
and failed to follow proper legal procedure when it did not consider, as
set forth in the Stipulation of the Parties, Husband's 2009 income of
$1,690,000.24 and Husband's 2011 income of $2,668,109.00.
6. The Trial Court committed an abuse of discretion and misapplied the
law when it ignored the credible evidence regarding Husband's ability
to receive future bonuses from the business, ignored the fact that
Husband was running the business, and ignored that, pursuant to a
May 6, 2010 agreement with his father, Husband had full control and
authority of the business.
7. The Trial Court committed an abuse of discretion and misapplied the
law when it accepted and permitted Husband to claim that 3803 Otter
Street was pre-marital property where, throughout the litigation and
until the day before trial, Husband represented that it was marital
property, and ignored Wife's expert appraiser's uncontested opinion as
to the value of 3803 Otter Street.
8. The Trial Court committed an abuse of discretion and misapplied the
law when it determined that the increase in value of 3 803 Otter Street
was only $10,876.00 where Husband presented no credible evidence to
establish the value at the time of the gift.
9. The Trial Court committed an abuse of discretion and misapplied the
law when it ignored the sworn testimony of Wife's expert appraiser as
to the value of 3805 Otter Street, and imposed upon Wife the duty to
present evidence of the alleged value of the gift of 3805 Otter Street to
Husband.
10. The Trial Court committed an abuse of discretion and misapplied the
law where it ignored the New Jersey litigation between the parties
involving Rycoja, and maintained the parties' status and interest in
partners in Rycoja, thereby not providing for an equitable distribution
of all marital property and leaving the parties involved in continuing
litigation.
11. The Trial Court committed an abuse of discretion and misapplied the
law where notwithstanding its refusal to consider and equitably
distribute the parties' interest in Rycoja, it used the January 2, 2012
equity in the real estate owned by Rycoja to determine a present
buyout price, ignored the January 2, 2012 reduction in debt owned by
Rycoja, and credited Husband with the sum of $85,734.00 he paid as
truces on income he improperly received as management fees from
Rycoja, which he was ordered to repay by the New Jersey Court.
6
12. While the Court did not commit an abuse of discretion in granting
Wife's Motion for Reconsideration, the Court did err in not permitting
the parties to introduce updated appraisals and evidence regarding the
value of and the depreciation of debt encumbering appreciating marital
assets, such as inter alia Rycoja, Second Generation, 3803 Otter
Street, and the Dreyfus IRA, which all appreciated in value between
the date of the hearing, in January 2012 and the Court's Amended
Equitable Distribution Order, entered March 6, 2015.
13. The Trial Court committed an abuse of discretion and misapplied the
law when it used a March 31, 2009 value for the Dreyfus IRA rather
than allocating a percentage of the current account balance.
14. The Trial Court committed an abuse of discretion and misapplied the
law when it (i) ignored the undisputed evidence that in 2004, Wife
only received $721 for the trade-in of the Chevrolet Suburan in 2004
because the proceeds were utilized to repay the loan on the vehicle;
and (ii) utilized a 2012 blue book value for the Chevroloet Suburban to
value the Chevrolet Suburan instead of utilizing a 2004 blue book
value for the Chevrolet Suburban.
15. The Trial. Court committed an abuse of discretion and misapplied the
law by not including the cash value of the Life Benefit life insurance
policy in the marital estate where the life insurance created by
Husband had expired, thereby making him the owner of the life
insurance, and where, until the eve of trial, Husband had represented
that the cash value was included in the marital estate.
16. The Trial Court committed an abuse of discretion and misapplied the
law when it permitted and accepted Husband's post-hearing evidence
regarding the value ofHobyak LLP, which the Trial Court mistakenly
refers to as Hobyak LLC.
17. The Trial Court committed an abuse of discretion and misapplied the
law when it gave Husband a credit in the amount of $49, 776.91 for a
post-separation loan Husband allegedly utilized to pay for repairs to
the marital home where there was no evidence to prove that Husband,
and not his Company, paid for the repairs and issued payment for
those repairs from his personal accounts.
18. The Trial Court committed an abuse of discretion and misapplied the
law when it granted Husband a credit of $117,882.84 for voluntary
post-separation payments to Wife consisting of post-separation gifts
and expense payments.
7
19. The Trial Court committed an abuse of discretion and misapplied the
law when on the one hand, it gave Husband 100% credit for $209,835
consisting of mortgage payments he paid at a time when Wife was not
in residence, joint federal and state income tax payments he paid,
homeowners' insurance payments he paid for the marital home, and
real estate taxes he paid on the marital home, ignoring Husband's
share of those debts, and on the other hand, it only provided Wife a
50% credit for payments she made for similar and like marital debts,
expenses and other obligations. Just as the Trial Court allocated
Wife's credits 50/50, it should have treated Husband's credits
similarly.
20. The Trial Court committed an abuse of discretion and misapplied the
law when it refused to consider post-separation, marital estate
distributions totaling $91,000.00 that Husband received from Second
· · Generations, which were specifically excludedfrom Husband's
income for support and alimony pendent lite purposes and, therefore,
should have been considered at the time of equitable distribution.
DISCUSSION
a. The Trial Court did not Abuse its Discretion or Commit an Error of Law when
it considered "newly discovered evidence" and "denied the parties' right to
cross-examine on "newly discovered" evidence.(111-2, 16)
As stated in detail above, both parties made representations on the record that there
would be post-trial submissions supporting their respective positions on equitable distribution.
Appellant's reference to "newly discovered" evidence, does not delineate with the requisite
specificity how the Trial Court erred and what specific information was considered and not
permitted cross-examination thereon. Importantly, the parties' post-trial submissions were made
available to each other and no objections were raised with consideration to anything submitted
thereon. The Trial Court, therefore, proceeded to render a decision based upon the
representations raised during the court proceeding, the Stipulation of the parties, and the post-
trial submissions. This was a scheme developed exclusively by the parties themselves, whereby,
8
they agreed to post-trial submissions and failed to make objection to any content in the post-trial
submissions.
Furthermore, the parties decided not to present testimony, with the exception of
William P. Larkin, Jr., Certified Public Accountant, who testified at the Trial Court's suggestion,
therefore both parties effectively waived their right to cross-examination. (N.T. 1/4/2012, at p.
123). Finally, when Appellant presented testimony and evidence at the subsequent hearing on
reconsideration of the November 25, 2013 Order that she possessed no knowledge of an asset,
which was "newly discovered," the Trial Court held an additional hearing and allowed Appellant
the right to present testimony and evidence and permitted cross-examination thereon.
Therefore, the Trial Court did not commit an error of law or abuse its discretion
when proceeding to render a decision in a fashion agreed upon by the parties, neither of which
voiced any objection to the use of any information found in the post-trial submissions.
b. The Trial Court utilized reasonable discretion when rendering a decision to
equitably divide the marital estate and did not ignore the stipulated earnings of
Appellant when rendering a decision. (~ 3-6).
A trial court has broad discretion when "fashioning an award of equitable distribution."
Dairympie v. Kilishek, 920 A.2d 1275, 1280 (Pa. Super. 2007) .. The standard of review when
assessing the propriety of an equitable distribution order is ''whether the trial court abused its
discretion by a misapplication of the law or failure to follow proper legal procedure." Biese v.
Biese, 979 A.2d 892 (Pa. Super. 2009). Furthermore, there "is no simple formula for dividing
marital property interests." And the method of distribution derives from the facts of the
individual case. Hurley v. Hurley~ 492 A.2d 439 (Pa. Super. 1985). Indeed the purpose of the
equitable distribution order is an ultimate determination of economic justice between the parties.
9
Section 3502, Equitable Division of Marital Property (a), states:
When fashioning equitable distribution awards, the trial court must consider: the
length of the marriage, any prior marriages, age, health, skills, employability of
the parties, sources of income and needs of the parties; contributions of one party
to the increased earning power of the other party; opportunity of each party for
future acquisitions of assets or income; contribution or dissipation of each party to
the acquisition, deprecioation or appreciation of marital property, value of each
party's separate property, standard of living established during the marriage;
economic circumstances of each party and whether the party will be serving as
custodian of any dependent children. 23 Pa.C.S.A. § 3502(a)(I)-(I 1)
Furthermore, "the weight to these statutory factors depends on the facts of each case and
is within the court's discretion." Mercatell v. Mercatell, 854 A.2d 609, 611 (Pa. Super. 2004),
citing Gaydos v. Gaydos, 693 A.2d 1368 (Pa. Super. 1997). In the instance case, the Trial
Court did take into consideration the length of the marriage but also took into consideration
Appellant's long enduring income derived through APL, her employability and potential given
her part in co-founding a global business, Hope Paige Design. (N.T. 1/4/2012, at p. 153).
Although Appellant contends she received very little benefit from Hope Paige Designs, in the
form of a meager salary, evidence presented demonstrated that Appellant categorized herself as a
"co-founder." In this respect, Appellant demonstrates great entrepreneurial skill and even if no
major economic benefit is immediately derived, her part in its co-founding clearly makes
Appellant an asset for other corporations and companies and her experience in forming a global
business from the "ground-up" is invaluable.
Although the Trial Court concedes that representations by counsel for Appellant at the
time of trial indicated that Appellant was no longer employed at Hope Paige Design, during
which period she received a very modest salary. This error, however, proved to be a harmless
error as the Trial Court did utilize the stipulation to derive Appellant's earnings.
10
With respect to consideration of Appellee's income, the Trial Court did indeed consider
Appellee's past earning history, but took as credible representations made during the course of
the hearing and post-trial submissions that such earnings were predominately derived from
bonuses and that the economic state at the time of trial made it unlikely such large bonuses
would be duplicated going forward. Indeed, certain grants that Appellee's business received
from the federal government were ending and that heretofore guaranteed source of income for
the business was no longer available.
The Trial Court, therefore, found it appropriate to issue an equal distribution of the
marital estate, believing such distribution, based on the parties' submissions and representations
at trial to be the best scheme to effectuate economic justice of the parties.
c. The Trial Court did not err when valuing 3803 and 3805-A Otter Street ((,r,r 7-9)
The Trial Court agrees with Appellant's assertion that prior to the January 2, 2013
hearing Appellee believed 3803- Otter Street to be marital, but immediately prior to the hearing
received information which lead him to contest its marital nature. The parties agreed and
stipulated that the value of 3803 Otter Street was $137,500.00; however, Appellee represented
that "a trust was created for tax purposes because the income beneficiaries of this trust were
going to be my client (Appellee] and the three children." (N.T. 1/2/2013, at p. 23). Therefore,
accordingly, Appellee took the position that the trust and its contents were non-marital. The
Court permitted the parties an opportunity to further investigate whether 3803 Otter Street was
marital or non-marital. The parties at that point, choose to address this issue through post-trial
submissions, rather than requesting a new hearing date. 3
3
Counsel for Appellant: "I would ask Your Honor to allow me at least the opportunity to have a report submitted
from Mrs. Hobyak's accountant in our post-trial submissions provided to rebut whatever information the accountant
has provided to Mr. Hobyak." (N.T. 1/2/2013, at p. 44)
11
Importantly, Appellant never requested of the Trial Court that the case be re-listed based
upon this information; rather, Appellant agreed to proceed with the understanding that both
parties' would submit reports and post-trial submissions on the issue for the Trial Court's
consideration. The Trial Court based its decision with respect to value and increase of 3 803
Otter Street on the parties' Stipulation, as well as the post-trial submissions, which the parties
agreed to allow the Trial Court to consider.
The Trial Court held a separate hearing on 3805-A Otter Street, based on Appellant's
representation during reconsideration that there was a newly discovered asset that was not
previously disclosed. A hearing was held on January 7, 2015, at which point Appellee testified
that he obtained 3805-A Otter Street prior to marriage. Furthermore, 3805-A Otter Street is a
land-locked parcel with an assessment of approximately $~,000.00. (N.T. 1/7/2015, at p. 40, See
P-2).
Appellant presented testimony and evidence from John J. Coyle, III, president of Coyle,
Lynch & Co., a real estate and personal property appraisal company. Mr. Coyle described 3805-
A as a .51 acre lot, located in "the rear of other real estate with no actual frontage on the street
and the method by which people enter this property and exit this property is across another
improved parcel of industrial real estate known as 3815 Otter Street that's occupied by Pennco
Tech." (N.T. 1/7/2015, at p. 17, 18). In making its valuation, Mr. Coyle considered its function
to the adjoining property. (N.T. 1/7/2015, at p. 18). Mr. Coyle, "valued the property as a whole."
(N.T. 1/7/2015, at p. 20).
The Trial Court could not accept as credible any testimony or evidence with respect to
valuation including a finding that this land-locked parcel could be sold on the open-market for
Counsel for Appellant: "I would like the opportunity again, Mr. Auerbach I think has agreed, to supplement
whatever post-trial submissions I have with whatever report my client has" (N.T. 1/2/2013, at p. 50).
12
the value outlined in Mr. Coyle's report. The Trial Court likewise found that the valuations
considered 3805-A Otter Street's value next to accompanying parcels and not in isolation. For
those reasons.the Trial Court found the value of3805-A to be de minimis based upon its low
assessed value and as Appellant was only entitled to an increase in value of this oddly shaped,
landlocked strip of land, the Trial Court found there to be no increase in value.
d. The Trial Court did not err in its treatment of Rycoja (,I,f 10-11)
Counsel for both parties represented that their clients wished to retain Rycoja, which is
the parties' biggest marital asset and is likewise an income generator. As the parties' had been
operating Rycoja jointly during the pendency of the divorce proceedings, the Trial Court gave
both parties the option of continuing to jointly operate the business. Cognizant, however, that
the parties' personal history may interfere with their ability or desire to co-operate Rycoja, the
Trial Court incorporated into the Court Order how Rycoja should be distributed in the event the
parties choose not to operate it jointly.
The Trial Court first comprised a buy-out scheme available for either party. Using
Wife's real estate appraisal of $2,250,000 less the current outstanding mortgage stipulated to be
$865,861.75 which yielded an equity value of $1,384,138.25. Importantly, no evidence of
additional debt beyond the outstanding mortgage was provided to the Trial Court for
consideration. Contrary to Appellant's assertion, the fair market value as appraised reduced by
the outstanding mortgage yielded the equity value, the division of which was calculated for
purposes of a buy-out. The buy-out scheme therefore provided either party the option to
purchase the other's interest for $692,069.23 (or half the equity value).
Finally, the Trial Court ordered that if both parties' were interested in retaining Rycoja
then Rycoja would simply be placed on the open market and the net sale proceeds would be
13
evenly divided between the parties. The Court, therefore, did order distribution of Rycoja and
therefore, there is a final distribution.
Appellant next challenges the Trial Court's decision to credit Appellee with' certain tax
consequences related to Rycoja. Specifically, limited representations occurred at the time of trial
whereby a court in the state of New Jersey issued an Order requiring Appellant to repay certain
amounts of monies that Appellant contends were taken as management fees. Appellant,
however, indicated that although the gross amount taken from Rycoja was·accurate that it did not
take into consideration the fact that Appellant did not receive the gross amount, but the gross
amount was reduced by tax consequences.
Both parties submitted post-trial submission to the Trial Court and the Trial Court found
in its equitable discretion that Appellee's debt to Rycoja should be reduced by the tax
consequences Appellee showed to have occurred.
e. The Trial Court did not err in not allowing the parties' to enter into evidence
updated appraisals and evidence regarding the value and depreciation of assets
and debts. (1 12)
On reconsideration, Appellant essentially requested the Trial Court to disregard the
parties' stipulation as to value and allow a complete re-trial of the case. Finding such request not
only impracticable and against judicial economy but also unfair to Appellee who would likewise
be forced to expend additional resources securing additional appraisals and undergo the
additional expense of another full equitable distribution hearing, the Trial Court declined such
request.
The Trial Court properly resolved to abide by the parties' stipulation as to value, which
was submitted to the Court and entered as an Order of Court.
14
f. The Trial Court did not err or commit an abuse of discretion when utilizing the
value of the Dreyfus IRA that the parties stipulated to. (,T 12)
Appellant next complains that the Trial Court erred when utilizing the value of the
Dreyfus IRA that the parties agreed to at the time oftrial.4 The parties' however agreed in open
court to utilize the value of $44,313.00. Therefore, to the extent that Appellant now complains a
different value should have been used or percentages, the Trial Court rejects this mandate and
contends that it acted appropriately and with the consent and acquiescence of both parties, whose
counsel acknowledged on the record and indeed requested the Trial Court to utilize this value.
g. The Trial Court did not err when valuing Appellant's 2004 Chevrolet Suburban
In spite of Appellant's contention, the record is replete ofthe reason why Appellant only
received $721.00 for the trade-in of her vehicle. Now, for the first time, Appellant contends that
she received $721.00 "because the proceeds were utilized to repay the loan on the vehicle." At
the time of trial, however, counsel for Appellee indicated that the valuation was much too low
and inconsistent with the market value of the vehicle. Appellant did not respond with any reason
for the low valuation. Because Appellant bargained and accepted an amount lower than market
value, Appellee argued that the Blue Book value of the 2004 Chevrolet Suburban should be used
for the valuation instead. Indeed, counsel for Appellee indicated on the record that he would be
submitting a Blue Book value. (N.T. 1/4/2012, at p. 115). Appellant never objected to the
submission at any time full knowing that it would considered by the Trial Court as evidence of
value. Appellant also presented no testimony as to any debt or loan associated with said vehicle.
Appellant next contends that the Trial Court should have used the 2004 blue book value
as opposed to the 2012 Blue Book value, presumably in accordance with the date of separation.
4
"We're willing to accept the $44,313.00, we think that there is additional interest as a result, Your Honor, but we
don't have that information." (N.T. 1/2/2012, at p. 114).
15
Appellant, however, waived this argument by failing to make appropriate objections to the Trial
Court or the post-trial submissions. Secondly, a 2012 blue book value would provide for a lower
value than utilizing the 2004 value, when the vehicle was eight years newer. The 2004 blue
book value would increase Appellee's award and decrease Appellant's award. Therefore,
Appellant's choice to submit evidence of value utilizing a 2012 blue book value did not harm or
prejudice Appellant and indeed was to the benefit of Appellant. The Superior Court has stated
that, "when determining the value of marital property upon divorce, the trial court is free to
accept all, part or none of the evidence as to the true and correct value of the property." Biese v.
Biese, 979 A.2d 892 (Pa. Super. 2009).
The Trial Court, therefore, and within its discretion utilized the valuation provided by
Appellee in the form of a 2012 blue book valuation.
h. The Trial Court did not err when not considering the cash value of the Lincoln
Benefit Insurance Policy.(115)
Counsel represented at the time of trial that the Lincoln Benefit Life Insurance policy is a
policy held in trust which Pennco pays the premium for. (N.T. 1/4/2012, at p. 104). Appellee
argued this was not a marital asset. The Trial Court considered this representation along with the
post-trial submissions and appropriately concluded that this was a non-marital asset. Appellant
now complains that this trust has since been terminated; however, Appellee was afforded ample
opportunity to present to the Trial Court proof contradicting the representations made at trial
with respect to the nature and character of the Lincoln Benefit Life Insurance Policy, and simply
failed to do so.
16
Appellant now, however, makes a complaint on appeal with nothing in the record or post-
trial submissions to support the contention that the trust has been terminated and that this
transforms the Lincoln Benefit Life Insurance Policy into a marital asset.
i. The Trial Court did not err in its determinations and awards of credits (,fl 7-19)
The Pennsylvania Superior Court has stated that: "characterization of debt as marital is
not necessarily determinative of which party is liable for its satisfaction upon divorce." Biese v.
Biese, 979 A.2d 892 (Pa. Super. 2009). Additionally, the amount and duration of alimony
pendent lite may be considered in equitable distribution. Id.In spite of Appellant's contentions, the Trial Court did not award Appellee one hundred
percent of the credits and Appellant fifty percent of the credits; rather the Trial Court awarded
Husband a refund of his tax liability in its entirety that had already been remitted to Appellant, an
amount agreed upon by the parties for sewage payment, mortgage payment, 2003 tax debt and
real estate taxes, certain post-separation expenses paid, half of the post-separation line of credit
used to make repairs and likewise credited Appellant with half the cost of repairs to the marital
estate.
As described above, Appellee was involved in litigation related to mismanagement of
Rycoja whereby certain monies which Appellant contended were maintenance fees were taken
from the business. Based upon representations of the parties, New Jersey entered an Order
requiring Appellee to re-pay this money taken by Appellant. Appellant, however, produced
credible evidence that he did not actually receive the entire amount due to tax liabilities
amounting to $85,734.00. Because the Trial Court found it inappropriate to award Appellant the
windfall of the tax consequences, the Trial Court credited Appellee for the taxes he had paid.
17
Furthermore, the parties agreed that the sewage payment, mortgage payment, 2003 tax
debt and real estate taxes were to be credited to Appellee in the amount of $209,835.00. With
respect to the post-separation expenses, the Trial Court concluded Appellee was entitled to a
refund of such expenses given the fact that Appellee has long been paying Alimony Pendente
Lite (hereafter "APL"), and its award anticipated Appellant would utilize APL for such
maintenance. The Trial Court was not persuaded that these post-separation expenditures to
Appellant were merely gifts and appropriately included them for equitable division. To allow
Appellant to receive APL and be entitled to retain the post-separation expenses expended by
Appellee would allow Appellant a double recovery. The Trial Court therefore permitted
Appellee to be reimbursed 100% for the post-separation expenditures for expenses that Appellant
should have paid with her APL award.
Furthermore, the Trial Court permitted Appellee to be reimbursed for half of the repairs
to the marital home while likewise awarding Appellant half of the expenditures made to repair
the marital home. The Trial Court took as credible the representations made during the course of
the hearing and the post-trial submissions with respect to Appellee's expenditures on repair. The
Trial Court, therefore, appropriately treated both parties equally when deciding the issue of who
•
was entitled to receipt of credits.
j. The Trial Court Did Not Err When Not Considering an Item it Was Not Asked
to Consider.
Finally, Appellant complains that the Trial Court erred when it "refused to consider post-
separation marital estate distributions totally $91,000.00 that Husband [Appellee] received from
Second Generations, which were specifically excluded from Husband's income for support and
APL and should have been considered for Equitable Distribution." The primary issue, however,
18
is that the Trial Court was not asked to consider this $91,000.00 sum in equitable distribution.
Furthermore, at the time the March 26, 2015 Order was entered, the parties were scheduled to
proceed in Support Court before the Honorable Barry Dozar, therefore affording Appellant the
opportunity to make argument that this sum should be included as income to Appellee.
CONCLUSION
The vast majority of the issues that Appellant complains of on appeal are directly related
to the schematic which both parties agreed to in order to effectuate equitable distribution. The
parties waived their right to testify during the equitable distribution proceeding dated January 4,
2012, choosing instead to permit their then respective counsel to summarize their positions.
They likewise agreed to allow the Trial Court to consider post-trial submissions, again, waiving
their right to cross examine or challenge the validity of any documentation and agreeing
beforehand that the Trial Court would be able to use these submissions as substantive evidence
for purposes of valuation. Furthermore, even after the post-trial submissions werereceived by
the court, no objection was made to anything presented to the Trial Court.
Indeed, it is only after the Trial Court entered an Equitable Distribution Order not to
Appellant's liking that the scheme which counsel heretofore agreed to became a basis for crying
court error. For the reasons set forth above, however, the Order should be affirmed.
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19
Circulated 09/09/2016 11:24 AM
IN THE COURT OF CO~ON PLEAS OF DELAWARE COUNTY,
PENNSYLVANIA
CIVIL ACTION - LAW
LISA P. HOBYAK
Plaintiff/ Appellant, Trial Court No.: 1993-8569
v. Superior Court No.: 1739 EDA 2015
MICHAELS. HOBYAK IN DIVORCE
Defendant/ Appellee
Bernard E. Zbrezeznj, Esquire for the Plaintiff/Appellant
200 Four Falls Corporate Center, Suite 400; West Conshohocken, PA 19428
David E. Auerbach, Esquire for the Defendant/Appellee
344 West Front Street; Media, PA 19063
OPINION
BRAXTON, J. Date: September 18, 2015
This is a cross appeal from an Equitable Distribution Order dated March 6, 2015, which
amended the Equitable Distribution Order dated November 25, 2013 after reconsideration was
granted. A Divorce Decree was entered April 28, 2015 thereby transforming the March 6, 2015
Order (hereafter "the Equitable Distribution Order") into a final appealable Order on April 28,
2015.
On cross-appeal, Michael S. Hobyak (hereafter "Husband" or "Cross-Appellant") filed a
Concise Statement of Matters Complained of on Appeal, complaining that the Trial Court
erroneously reconsidered the Order dated November 25, 2013 when it was filed in excess of
thirty (30) days, the Trial Court erred in its distribution ofRycoja, and finally, the Trial Court
erred when it did not reduce the amount of alimony pendent lite Husband was paying to Wife.
For the reasons as set forth herein, Husband's contentions are without merit.
1
FACTUAL AND PROCEDURAL HISTORY
Appellant and Appellee were married on April 16, 1983. On or about June 14, 1993,
Wife filed a Complaint in Divorce; however, thereafter, the parties reconciled until their ultimate
separation on January 2, 2004. From 2004 until 2011, multiple petitions and appeals were filed
including petitions related to the following: injunctive relief, discovery issue resolution,
contempt allegations, special relief requests, conference requests, requests to relist, and multiple
appeals to the Superior Court. On or about September 6, 2011, the Honorable Kathymanne
Durham issued an Order after a hearing Ordering that "if an appeal from the recommendation of
the hearing officer, Donald Lehrkinder, Esquire, the appeal will be assigned to the Honorable
John L. Braxton."
Thereafter the Equitable Distribution hearing officer, Master Lehrkinder issued a
recommendation which was signed as an Order of Court and thereafter appealed on September
20, 2011 upon Appellant's Request for a hearing de novo. A hearing was scheduled before the
Honorable John L. Braxton for January 4, 2.012. At the hearing, Stipulations of the Parties
(hereafter "the Stipulation") were presented to the Trial Court and a Court Order was entered
thereafter on January 10, 2012, entering the Stipulation as an Order of Court. The Stipulation
contained background information of the parties, including Wife's W-2 information for the years
2007-2010, Husband's gross and net income for 2002-2011, the parties' marriage information,
stipulated values of certain marital assets, the parties' agreed upon separate assets, and certain
information relative to Wife's support claim.
At the hearing, both parties' waived their right to present live testimony, choosing
instead, "to proceed by colloquy with the Court where I [Counsel for Husband] state our position
with regard to various positions, Ms. Casale [Counsel for Wife] states the position of Lisa
2
(Appellant], and the Judge then ifhe has any questions of either of us [counsel] or you
(Appellee] and Lisa [Appellant] will do it in a manner without you getting on the witness stand
and testifying." (N.T. 1/4/2012, at p. 6). Both parties responded on the record that they
understood and agreed to the procedure as outlined by their counsel. (N.T. 1/4/2012, at p. 6, 8).
Importantly, this was a scheme developed and agreed to exclusively by the parties.1 The Court
permitted counsel to try the case as they ~hoose to do and accepted counsel's summation of
testimony and evidence, as the parties mutually agreed on how to procedurally advance at trial.
Counsel likewise jointly agreed to supplement the record post-hearing by agreeing on the
record to submit various proofs and items. Counsel agreed to submit certain items and proofs
directly to the Trial Court in lieu of presenting testimony and evidence during the Trial Court
proceeding.i Both parties were fully cognizant that the Trial Court would be considering post-
trial submissions in rendering an Equitable Distribution Order, this again being a joint decision
by the parties. Indeed, the parties' requested the Trial·Court to consider post-trial submissions
and such submissions, although available to each other for review, were never objected to in
written form or otherwise. Importantly, both counsel had abundant opportunity to review the
I
Mr. Auerbach (counsel for Husband): "Michael, you understand that you have a right to a hearing with testimony,
both of yourself, experts with regard to various issues involved with the case. You understand that in order to try to
have the matter resolved as quickly as possible that we have agreed to proceed by colloquy with the Court where I
state our position with regard to various positions, Ms. Casale [Wife's counsel] states the position of Lisa, and the
Judge then if he has any questions of either of us or of you and Lisa will do it in a manner without you getting on the
witness stand and testifying. Do you understand that's the procedure we've discussed and we're going to proceed in
that manner.
Michael Hobyak: I believe I understand that yes."
Mr. Auerbach: And are you satisfied to do it in that manner?
Michael Hobayk: I am.
The Court: The Court will accept his admission.
Ms. Casale (Counsel for Wife): You understand that what we have agreed to do today is allow Mr. Auerback and I
to swnmarize what you would actually testify to, understand?
Lisa Paige Hobyak: Yes.
Ms. Casale: And that you are trusting that I will be able to recite the information that you testify about accurately,
you understand?
Ms. Hobyak: Yes. (N.T. 1/4/2012, at p. 6-8).
2
Mr. Auerbach: There are various credits on both sides that are disputed with regard to it. What we're suggesting
that we will submit them to the Court of the various arguments as part of it rather than go through them now." (N.T.
1/4/2012, at p. 196)
3
hefty submissions and make objections as the Equitable Distribution Order was not issued until
November 25, 2013.
On or about January 2, 2014, Wife, by and through her counsel, filed a Motion for
Reconsideration of the November 25, 2013 Order. On or about July 14, 2014, the Trial Court
held a hearing on Wife's Motion for Reconsideration and Husband's response thereto. The Trial
Court was permitted to do so because the Divorce Decree had not yet been entered and thus the
November 25, 2013 Order was an Interim and not Final Order. After the July 14, 2014 hearing,
the Trial Court found sufficient grounds to reconsider portions of the November 25, 2013 Order,
although specifically refusing to rehear the case in its entirety as Wife requested. Wife was,
however, granted an additional hearing with respect to a certain parcel of property, 3805-A Otter
Street, Bristol, Pennsylvania (hereafter "3805-A Otter Street") which Wife contended was an
asset never before disclosed to her. A full and fair hearing on the limited issue of 3805-A Otter
Street occurred on January 7, 2015.
On or about March 6, 2015, the Trial Court entered an Amended Equitable Distribution
Order, which corrected certain valuations that were inconsistent with the Stipulation (although
consistent with certain of the parties' post-trial submissions), modified the November 25, 2013
Order based upon the parties' joint representation that the Stipulation erroneously contained the
incorrect number of shares of Bancorp stock, and furthermore found 3805-A Otter Street to be a
pre-marital asset with a de minimus increase in value based upon its assessment and the land-
locked nature of the parcel at issue.
On or about April 28, 2015, a Divorce Decree was entered and on or about May 26, 2015,
Appellant filed an appeal raising the following for consideration:
1. The Trial Court erred in issuing an Amended Equitable Distribution
Order which modified the original Equitable Distribution Order, in
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effect granting reconsideration to Wife, because no Order granting
reconsideration was entered within thirty (30) days of the original
Equitable Distribution Order pursuant to Pa. R.C.P. 1930.2(e), that
being January 6, 2014.
2. The Trial Court erred when it divided the marital estate via its March
6, 2015 Amended Equitable Distribution Order because it failed to
properly distribute certain assets, including the limited liability
company known as RYCOJA, in the following ways:
a. Trial Court failed to order the property owned by RYCOJA be
transferred to Husband;
b. Trial Court failed to give Husband proper credit with regard to
various funds, including those in which he was entitled to as a
result of his purchase of the mortgage on the property owned
by RYCOJA from the mortgage company because it had
become due;
c. Trial Court failed to take into consideration monies that
Husband was required to pay as a result of a Court Order with
regard to the same property from a New Jersey Court;
specifically, Husband was required to reimburse over
$300,000.00 to RYCOJA that were distributed to him for
management fees and upon which he paid truces. A portion of
Wife's alimony pendent lite payments were based on these
previously distributed fees. As a result of the New Jersey
Order, she was essentially permitted to "double-dip" by
becoming entitled to those monies through RYCOJA;
d. Trial Court failed to take into consideration that monies paid by
Pennco Tech (the tenant of the subject property) to Husband,
the owner of the note which was in default, and monied paid by
Pennco Tech to R YCOJA required to be paid by Court Order
to satisfy the rental obligations under the lease, required
Pennco Tech to pay rent twice and allowed Wife a double-
benefit: (i). the benefit of the rental payments made to RYOJA
(from which she benefited) that had previously been paid to
Husband as holder of the note; and (ii.) a claim for a reduction
of the obligations owned under the note because monies were
received and kept by Husband during the same period.
3. The Trial Court erred by failing to appropriately reduce the amount of
alimony pendent lite that Husband was paying to Wife under an
5
••
interim Order issued by a hearing officer which was appealed to the
Trial Court.
DISCUSSION
a. The Trial Court did Commit an Error of Law when permitting reconsideration
of the order dated November 25, 2013, when such Order was not a final
equitable distribution order as the Divorce Decree was yet to be entered.
The Superior Court has directed that "the time within which a trial court may grant
reconsideration of its orders is a matter oflaw ... " Estate ofHaiko v. McGinley, 799 A.2d 155,
158 (Pa. Super. 2002). When reviewing a trial court's decision for a grant of reconsideration,
such shall be reviewed for an error oflaw. McEwing v. Lilitz Mutual Ins. Co., 77 A.3D 639
(Pa.Super 2013). For questions oflaw, the Superior Court's standard ofreview is de novo and
the scope ofreview is plenary. Mazurek v. Russell, 96 A.3d 372, 378.
Pennsylvania Rule of Civil Procedure 1930.2(e) states:
If the court grants the motion for reconsideration, and files same, within the 30
day appeal period, it may, at any time within the applicable 120 day period
thereafter, issue an order directing that additional testimony be taken. If it does,
the reconsidered decision need not be rendered within 120 days, and the time for
filing a notice of appeal will run from the date the reconsidered decision is
rendered.
However, the statute allowing the trial court to modify or rescind an order within thirty
(30) days after its entry applied only to final orders. Manufacturers and Traders Trust Co. v.
Greenville Gastoenterology, S.C., 108 A.3d 913 (2015). Apre-divorce order of equitable
distribution is not a final order. Campbell v. Campbell, 357 Pa. Super. 438, 516 A.2d 363.
As the Divorce Decree was not entered until April 28, 2015, the equitable distribution order
dated November 25, 2013 was interlocutory and not subject to the thirty day reconsideration
parameter.
6
..
b. The Trial Court did not err in its distribution of RYCOJA
Counsel for both parties represented that their clients wished to retain Rycoja, which is
the parties' biggest marital asset and is likewise an income generator. As the parties' had been
operating Rycoja jointly during the pendency of the divorce proceedings, the Trial Court gave
both parties the option of continuing to jointly operate the business. Cognizant, however, that
the parties' personal history may interfere with their ability or desire to co-operate Rycoja, the
Trial Court incorporated into the Court Order how Rycoja should be distributed in the event the
parties choose not to operate it jointly.
The Trial Court first comprised a buy-out scheme available for either party. Using
Wife's real estate appraisal of $2,250,000 less the current outstanding mortgage stipulated to be
$865,861.75 which yielded an equity value of $1,384,138.25. Importantly, no evidence of
additional debt beyond the outstanding mortgage was provided to the Trial Court for
consideration. The fair market value as appraised reduced by the outstanding mortgage yielded
the equity value, the division of which was calculated for purposes of a buy-out. The buy-out
scheme therefore provided either party the option to purchase the other's interest for $692,069.23
(or half the equity value).
Finally, the Trial Court ordered that if both parties' were interested in retaining Rycoja
then Rycoja would simply be placed on the open market and the net sale proceeds would be
evenly divided between the parties.
To the extent that Husband complains the Trial Court did not consider or give Husband a
credit for various funds which he claims entitlement to by virtue of an alleged purchase of the
mortgage on the property owned by RYCOJA, Husband failed to present adequate testimony
7
. ,,
during the January 4, 2012 hearing adequately evincing such entitlement and Husband's post-
trial memorandum merely asserts Husband's entitlement without the requisite proof.
Husband likewise failed to present any proof that Wife's alimony pendent lite award
considered income for which he was Ordered by the State of New Jersey to reimburse to Rycoja.
Furthermore, the support action was subsequently assigned to the Honorable Barry C. Dozor for
disposition, affording Husband the opportunity to argue the merits thereof.
c. The Trial Court did not err by choosing not to Order a reduction in Alimony
Pendente Lite owed to Wife.
Husband failed to elucidate at the January 4, 2012 hearing appropriate grounds for a
reduction in Alimony Pendente Lite (hereafter "APL"). Although courts are permitted to deviate
from the APL guidelines where special circumstances warrant an award adjustment, Husband,
simply put, failed to present convincing evidence of such entitlement. Ball v. Minnick, 648
A.2d 1192. The Trial Court, did, however, take into consideration the amount of APL paid by
Husband as well as the fact that Husband was not guaranteed future bonuses which heretofore
amounted to a large portion of Husband's earnings when fashioning an appropriate distribution
scheme.
CONCLUSION
For the reasons as set forth above, the Trial Court found it appropriate to enter an
amended equitable distribution Order dated March 6, 2015.
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