The opinion of the court was delivered by: Greene, Judge.
Appeal by defendant, Peter C. Condellone, from judgment dated 4 December 1996 and from order filed 1 May 1997, and cross-appeal by plaintiff from order filed 1 May 1997 by Judge William L. Daisy in Guilford County District Court. Heard in the Court of Appeals 1 April 1998.
Peter C. Condellone (Defendant) appeals from the trial court's 4 December 1996 judgment, which ordered specific performance of Defendant's alimony obligations under the parties' separation agreement, and 1 May 1997 order, which terminated Defendant's alimony obligations as of 25 October 1996. Carroll H. Condellone (Plaintiff) likewise appeals from the trial court's 1 May 1997 order.
Plaintiff and Defendant married in March 1969, separated in August 1985, and divorced in November 1986. The parties entered into an agreement on 12 August 1987 (Separation Agreement) to resolve their remaining claims. The Separation Agreement has not been incorporated into any court order. Paragraph 18 of the Separation Agreement provides:
ALIMONY. Husband shall pay to Wife as permanent alimony the following: $1,500.00 per month until Wife remarries or cohabits with an adult male to whom she is neither related nor married or until the death of either Husband or Wife. Said payments are due on or before the 10th day of each month.
Pursuant to this provision of the Separation Agreement, Defendant paid Plaintiff $1,500.00 per month alimony from August 1987 through April 1992. In May 1992, Defendant paid only $800.00. Defendant paid no alimony in June or July of 1992. Defendant paid only $750.00 in August 1992. Since that time, Defendant has made no alimony payments to Plaintiff.
In February 1993, Plaintiff brought a breach of contract suit against Defendant seeking as damages the alimony arrearages then due under paragraph 18 of the Separation Agreement. The trial court entered a judgment by default against Defendant in the amount of $13,450.00 (plus costs). Because this judgment remained unsatisfied and alimony arrearages continued to accrue, Plaintiff subsequently filed three additional actions against Defendant (which were consolidated to form this case) seeking specific performance of paragraph 18 of the Separation Agreement.
In his July 1996 deposition, Defendant testified that the parties' adult son had told Defendant that Plaintiff had cohabited with an unrelated adult male in 1990 or 1992, and Defendant and his current wife testified that Defendant had hired a private detective to investigate Plaintiff "[a]bout a year ago." Defendant filed answers to each of Plaintiff's complaints, but did not raise cohabitation as an affirmative defense in any of these answers. Two days prior to trial, however, Defendant sent Plaintiff a draft of a proposed affidavit from Defendant's private investigator. This affidavit revealed that Defendant's private investigator had evidence that Plaintiff had cohabited with an unrelated adult male from 1 June 1996 through 22 October 1996.
After receiving the private investigator's proposed affidavit from Defendant, Plaintiff made a motion in limine requesting the trial court to exclude any evidence that Plaintiff had cohabited with an adult male to whom she was not related or married, on the ground that cohabitation constituted an affirmative defense which Defendant had not raised in his answers. The trial court granted Plaintiff's motion in limine, and did not allow Defendant to present evidence of Plaintiff's cohabitation.
In the 4 December 1996 judgment, the trial court found: Defendant has not asserted and there is no evidence that [D]efendant is excused from performance of the requirements of paragraph 18 [of the Separation Agreement] because . . . [P]laintiff has breached some obligation imposed on her by the Separation Agreement.
The trial court found that Defendant and his current wife are the only directors, officers, and employees of Market Master Sales Co., Inc. (Market Master). "Market Master is in good financial health. It had gross income in 1993 of $202,434.00, in 1994 of $310,732.00, and in 1995 of $432,067.00. Gross income in 1996 should at least equal that of 1996 [sic]." The trial court further found:
Defendant did not present any evidence of his specific monthly living expenses . . . [and] testified only that he has monthly net income of $2,412.00 and that his living expenses exceed that figure. However, [D]efendant did not provide any factual basis for that statement, and, in light of the other evidence of [D]efendant's income, the Court does not accept it as accurate.
The trial court found that Market Master, in addition to paying Defendant $500.00 per month rent for the use of office space in Defendant's home, pays for the cars driven by Defendant and his current wife and for their medical and dental insurance. Market Master also provides life insurance for Defendant, and profit sharing. Defendant currently has a retirement account with Market Master in excess of $15,600.00. Although Defendant did not present credible evidence of his current income, tax records revealed that Defendant's wages in 1995 were in excess of $4,000.00 per month, and the wages of Defendant's current wife in 1995 were in excess of $6,000.00 per month. Finally, the trial court found that Defendant's salary from Market Master decreased "at about the time that [D]efendant stopped paying [P]laintiff the alimony payments due under the Separation Agreement." The trial court noted that this "evidence[d] a deliberate pattern of conduct by [D]efendant to depress [his] income and thereby defeat [P]laintiff's rights under the Separation Agreement." The trial court found as liabilities payments of $400.00 per month for personal debt, and a $1,154.00 monthly mortgage payment on Defendant's $127,000.00 home. Based on these findings, the trial court concluded that Defendant has the "means and ability to carry out the terms of paragraph 18 of the Separation Agreement and to pay the arrearages due [P]laintiff."
The trial court entered judgment on 4 December 1996 ordering that Plaintiff recover of Defendant $66,000.00 in alimony arrearages which had accrued since entry of the 1993 judgment for damages against Defendant. The trial court ordered Defendant to pay Plaintiff the $1,500.00 monthly alimony payment as provided in the Separation Agreement, as well as an additional $1,000.00 per month until both the $66,000.00 found to be due in this action and the 1993 judgment in the amount of $13,450.00 were paid in full.
Subsequently, on 20 December 1996, Defendant filed a motion for new trial and relief from judgment, pursuant to the North Carolina Rules of Civil Procedure. In this 20 December 1996 motion, Defendant contended that the trial court should grant a new trial pursuant to Rule 59(a)(4) (newly discovered material evidence), Rule 59(a)(7) (insufficient evidence), Rule 59(a)(8) (error in law), and Rule 59(a)(9) (any other reason heretofore recognized as grounds for new trial). Defendant also contended in his 20 December 1996 motion that the trial court should grant him relief from the 4 December 1996 judgment pursuant to Rule 60(b)(2) (newly discovered evidence), Rule 60(b)(3) (fraud), Rule 60(b)(4) (judgment is void), and Rule 60(b)(5) (judgment is no longer equitable). The trial ...