Equitable is What Equitable Does (or Doesn’t)

Upon divorce in New York, spouses are entitled to “equitable distribution” (i.e., a fair division) of the marital assets.  But consider the following scenario: one spouse files for divorce and the other does not respond (i.e., fails to answer the Complaint). The court issues a default judgment in favor of the spouse who filed but makes no decision regarding the allocation of the couple’s belongings and most importantly, the house.  Twenty years later, the defaulting spouse seeks equitable distribution, including a piece of her former spouse’s earnings as a medical doctor. In a July 15, 2014 Order, a Nassau County Supreme Court Judge held that the doctrine of “res judicata” can operate to bar such relief.  Res judicata prevents a party who has been given a full and fair opportunity to litigate a claim from re-litigating that claim after it has been decided; the concept applies when the party has actually raised or could have raised the claim before.

In E.K. v. T.K., Supreme Court, Nassau County, Index No.: 012302 (July 2014), plaintiff, a medical doctor, had obtained a Judgment of Divorce on default in 1990 and after Inquest, he secured exclusive possession and occupancy of the marital home and sole custody of the parties’ four children. But while it awarded defendant two years of maintenance and liberal visitation, the Judgment did not provide for equitable distribution of the marital property (which included a jointly-owned home in Old Westbury), and the transcript of the Inquest was silent on the issue.   Plaintiff raised the couple’s four children in and generally maintained the marital home (encumbering it to finance their professional educations), and paid a high-interest mortgage, the taxes, and all other associated expenses for the 20+ years. No longer able to afford the financial burden by 2011, plaintiff asked his former spouse to deed the house to him for purposes of sale and division of the proceeds. Defendant refused, ostensibly desiring to keep this “piece of history” in the “family.” Plaintiff filed a partition action in Nassau County, and defendant cross-petitioned for equitable distribution of all marital assets, one of which, she claimed, was her former husband’s medical license.

Justice Margaret C. Reilly acknowledged that a court must determine the parties’ respective rights even if one is in default.  But, Her Honor noted, “litigants are not freed from their obligation to litigate all issues affecting the marriage.” Rather, “res judicata…requires that ‘once a claim is brought to final conclusion, all other claims arising out of the same transaction or series of transactions are barred, even if based upon different theories or if seeking a different remedy.  As a result, plaintiff was able to sell the house and divide the proceeds with his former spouse.