DIVORCE - LEGAL FEES DURING AN APPEAL WITH STAY

Kaplan v. Kaplan, Date filed: 2023-03-30, Court: Supreme Court, Nassau, Judge: Justice Stacy D. Bennett, Case Number: 800273/20:

"CPLR §5519(a)(2) provides that a stay may be obtained without court order where “the judgment or order directs the payment of a sum of money, and an undertaking in that sum is given that if the judgment or order appealed from, or any part of it, is affirmed, or the appeal is dismissed, the appellant or moving party shall pay the amount directed…” CPLR §5519(c) provides “the court from or to which an appeal is taken or the court of original instance may stay all proceedings to enforce the judgment or order appealed from pending an appeal or determination on a motion for permission to appeal in a case not provided for in subdivision (a) or subdivision (b), or may grant a limited stay or may vacate, limit or modify any stay imposed by subdivision (a), subdivision (b)…” (emphasis added).

This Court recognizes that there is an incongruity in the interplay between CPLR §5519 and DRL §237, DRL §237 allows for an award of legal fees to the “less monied” spouse in order to level the playing field and create a sense of equality between the parties however CPLR §5519 allows for a party with significantly more in resources to create a delay in the payment of legal fees for potentially years, creating the precise issue that the DRL §237 seeks to ameliorate. In Wechsler v. Wechsler, 8 Misc.3d 328 (Sup. Ct., N.Y. Co., 2005), the Court (Gische, J.) articulated the injustice associated with the utilization of CPLR §5519(a)(2) within the context of an award of interim attorney’s fees. The Court stated, in relevant part:

By appealing a decision awarding a non-monied spouse interim counsel fees, and then bonding the award to stay enforcement pending appeal, a monied spouse can compromise a nonmonied spouse’s ability to litigate the ongoing case proceeding at the trial level. The effect of the stay is to prevent the non-monied spouse from receiving money to pay professionals as the case continues. Thus, the monied spouse achieves indirectly what it could not do directly, depriving the nonmonied spouse of the ability to pay for representation while the case is ongoing.

In Karg v. Kern, 125 A.D.3d 527 (1st Dept., 2015), the First Department affirmed the lower court’s vacatur of an automatic stay of interim matrimonial counsel fees. The First Department held that the CPLR §5519 stay “prevent[ed] an even playing field in the litigation.”

In B.N. v. M.N., 76 Misc.3d 1202(a), 172 N.Y.S3d 919 (Sup. Ct., Nassau Co. 2022), an award of interim legal fees was the subject of an appeal, and the payor-husband posted an undertaking in the amount of the interim legal fees thereby creating a stay of enforcement of the Order. The Court (Dane, J.) initially made the threshold determination as the court of original instance, it had the authority pursuant to CPLR §5519(c) to vacate the stay imposed by the posting of the bond. Following a determination that the court had the power to vacate the stay, the court held that it was incumbent upon the Court to ensure that counsel fees pursuant to DRL §237 are “timely paid” and the Court relied, in large part upon the determination in Wechsler, that “the fact that the stay is automatic does not remove it from the purview of the court’s discretion to otherwise vacate, limit or modify the stay.”

This Court is vested with the power and authority to vacate or modify the stay created by the husband by virtue of his posting of a bond pursuant to CPLR §5519. The trial of this matter was concluded, and a Judgment of Divorce was issued. To the extent that the wife requires an award of fees associated with the pending appeal, the wife has legal remedies with respect to same. The fees awarded to the wife pursuant to the Decision and Order After Trial were not awarded as interim fees, but rather fees awarded after the parties submitted their respective post-trial briefs. There was no “unequal playing field” as a result of the financial inequity of the parties and the posting of the bond did not compromise the legal representation the wife received during the parties’ divorce. Indeed, while the husband enjoys the benefit of a stay with respect to his court-ordered counsel fee obligation, the Judgment of Divorce remains in full force and effect and to the extent that enforcement of that Order is necessary (other than the payment of attorney’s fees to wife’s counsel) the wife has the right to pursue same and seek relief pursuant to DRL §238.

This Court acknowledges the disjunction that exists by virtue of the self-imposed stay created by CPLR §5519(a)(2) and the award of interim attorney’s fees pursuant to DRL §237 to a “less monied” spouse in order to ensure that “the matrimonial scales of justice are not unbalanced by the weight of the wealthier spouse’s wallet.” See O’Shea v. O’Shea, 689 N.Y.S.2d 8 (1999). This case is distinguishable from the cases cited above as the award of legal fees was made at the conclusion of the matrimonial matter whereas the vacatur of the §5519(a)(2) stay in Wechsler, Karg and B.N., supra, was the result of a determination by the Court that the legal fees awarded were necessary to avoid an unfair advantage to the monied spouse during a divorce.

Based upon this Court’s determination the legal fees awarded within the Decision and Order After Trial were not awarded as and for prospective legal fees to “even” the litigation playing field relative to the prosecution/defense of a matrimonial action, this Court declines to vacate the stay pursuant to CPLR §5519(a)(2). Accordingly, the wife’s application to vacate the automatic stay of the Decision and Order After Trial dated July 29, 2022 and the Judgment of Divorce dated December 22, 2022 is hereby DENIED."