Lionetti v. Lionetti

A-0374-98T1 (N.J. Super. App. Div. 1999) (Unpublished)
  • Opinion Date: June 21, 1999

CONTRACTS; INDEMNIFICATION—A consent order requiring a husband to both indemnify and hold his ex-wife harmless from particular debts is broader than merely an indemnification against loss and prior payment of a given debt by the ex-wife is not a prerequisite to the husband’s responsibility to eliminate the debt.

Subsequent to a divorce, the parties agreed by consent order that the husband would “be responsible for any debt owed to the Federal or State Government for income taxes, interest and/or penalties due for the tax years 1986 thru 1993.” In addition, he agreed to indemnify and hold his ex-wife harmless as and to the same. The agreement also provided that in the event that the wife was compelled to pay any monies as a result of the taxes, the husband would reimburse her within seven days. Four years later, the wife discovered that two years after the consent agreement, the State of New Jersey had filed a Certificate of Debt against her for taxes owed by her and her ex-husband in respect of two of the years included within the consent order. She then moved for an order compelling her husband to pay the judgment. The lower court ordered that the husband either pay the Certificate of Debt in its entirety, or have his ex-wife’s name removed of record from the Certificate of Debt. The husband claimed that the lower court was in error because the consent order required proof of payment by the ex-wife as a condition precedent to his obligation. The Appellate Division upheld the lower court because the consent order contained language which obligated the husband to both indemnify his wife against any losses and to hold his wife harmless for any debt owed to the government. Accordingly, the consent agreement was broader than merely an indemnification against loss and could fairly be read to require indemnification against liability as well.