CHILD SUPPORT - COLLEGE EXPENSES

Many financial advisors claim that it's more important to save for retirement than it is to pay for your kids' college. But this can change when a court is involved in your divorce.

Messinger v Messinger, 2020 NY Slip Op 50215(U), Decided on February 11, 2020, Supreme Court, Monroe County, Dollinger, J.:

"Defendant brought this post-judgment application seeking contribution for college expenses for the parties' daughter. After an initial hearing, this Court preliminarily indicated that some contribution would be appropriate, but concluded that additional discovery was needed in order to calculate the appropriate amount. The Court issued an opinion confirming those details dated April 24, 2019. Thereafter, the matter was scheduled for an additional hearing. After exchanges of settlement proposals and a hearing, this Court now resolves the contributions of each parent and the issue of attorneys fees.

1. The College Expenses for the Daughter

As noted earlier, the couple made an agreement regarding the payment of college expenses for their son but not their younger daughter. In the record before this Court, both parents have access to ample resources to finance the college costs of their daughter. The parties anticipated financing college costs because they establish a 529 account for their children and the account has funds remaining after the education of their older son. In addition, the husband has a retirement pension from the State of New York and a substantial deferred compensation account. He also works part-time. The wife also receives a portion of the husband's pension, courtesy of equitable distribution, and has a substantial benefit in her marital share of the deferred compensation account, even though it is, upon information and belief, undistributed at this stage. She is also employed.

In short, both parents are working and generating income. Based on these facts, [*2]which are undisputed, it appears that both parents should share in some part of the college costs on a pro rata basis. Neither party disputes that this Court may direct parental contributions to the daughter's education even absent an agreement. Matter of Paccione v. Paccione, 57 AD3d 900 (2d Dept 2008); Matter of Rabasco v. Lamar, 106 AD3d 1095 (2d Dept 2013)(the court must consider the circumstances of the case, the circumstances of the respective parties, the best interests of the children, and the requirements of justice). The later two criteria are easily quantified here: the parents concede that the best interests of their daughter require a college education — as they agreed for their son — and intra-family justice — giving their daughter the same opportunity as their son — is evident.

In their agreement regarding the financing of their son's college education, the father agreed to finance the son's college costs, except for a $6,000 "student loan per annum." However, at that time, the father's income was significantly higher than his current income, The agreement, requiring the father to finance the college education for the son, was signed in 2014. In 2016, the last full year that the father worked, he earned in excess of $115,000. However, the father was nonetheless entitled to determine when to retire, an event that resulted in the distribution of the marital share of his state pension to his former wife and the mother of the child seeking college assistance. There is no evidence in the agreement that the parents anticipated the father's retirement in his late 50s but, conversely, there is nothing that restricted his ability to retire. Given all these facts and the conclusion that the parents each received a significant pension benefit when the father retired, this Court will consider only the current income of the parties in allocating the college costs for the daughter. In this Court's view, a proportional allocation of the parental cost of the daughter's college education is not unreasonable, accords with the current financial circumstances of the parents and has some semblance to the terms under which the parents financed the son's education.[FN1]

This Court also notes one other aspect of the parties's agreement. In their allocation of college costs for their son, the couple agreed that neither parent would pay child support for their college-aged son. Art. VIII (I)(1). The parents also agreed to a deviation from the presumptive amount of child support for one child for a number of factors including payment of the daughter's equestrian expenses and the father's payment of the full cost of health insurance. In addition, as another deviation factor, the couple agreed that the father would finance the son's college education without a contribution from the mother. The amount of the agreed deviation from the presumptive amount of child support for one child was from $1006 per month to $675 per month. Importantly, there is no language in the agreement that suggests that when the father began financing a contribution to the daughter's education that any similar deviation in the presumptive amount of child support was anticipated. In short, there is nothing in the agreement that indicates that payment of the daughter's college [*3]expenses would result in a downward deviation of the father's child support obligation. In New York, the courts have declined to link payment of college expenses with child support obligations. Cimons v. Cimons, 53 AD3d 125, 133 (2d Dept 2008)(tuition expenses are separate from child support).

In prior instances, this Court has imposed a cost sharing as follows: one-third to the student and the remaining two-thirds divided in a pro rata fashion to the parents according to annual income. The child's share is reduced by any grants or scholarships and if the amount of such grants or scholarships exceeds the student's one-third share, then that amount reduces the respective shares of the parents. This Court has also considered whether the Court should impose what is commonly-referred to as a SUNY-cap. Matter of Wheeler v. Wheeler, 174 AD3d 1507, 1508 (4th Dept 2019); Borrelli v. Borrelli, 63 Misc 3d 1202(A)(Sup.Ct. Monroe Cty 2019). In their agreement to cover the college costs of their son, the couple imposed a SUNY-cap, equivalent to the costs associated with State University College at Brockport. In this court's view, a similar cost containment feature should be imposed on the daughter's college education costs.

One other issue looms in the allocation of costs and involves the consequences of student loans obtained by the daughter. In other contexts, New York courts have required parents to shield their children from student loans. See Matter of Rashidi v Rashidi, 102 AD3d 972 (2nd Dept. 2013)(even though the judgment of divorce applied a SUNY cap and despite any language regarding the allocation of the student loans, the court held that the parents were liable to repay any loans incurred by the son); Bungart v. Bungart, 107 AD3d 751 (2nd Dept. 2013) (in the absence of a clear and unambiguous provision expressly authorizing the deduction of the children's student loans from the college expenses toward which the parties agreed to pay, a court should not take into account any college loans for which the student is responsible). In this instance, the Court will still require the daughter to seek loans up to $6,000 per year and be responsible for such loans. In that manner, the daughter is treated to the same allocation of loan debt given to her brother in the parent's agreement.
Based on these facts, the Court orders the parties to divide the daughter's college costs as set forth above: a SUNY-cap equivalent to the annual costs at the College at Brockport, one-third allocated to the daughter (offset by grants or scholarships and supplemented by loans up to $6,000 per year) and the parents pay, in pro rata shares based on their annual income, the remaining costs.[FN2] In addition, any 529 account allocation should be credited equally between the parents, as these sums were marital money contributed to these tax-deferred accounts.[FN3]

2. Attorneys fees for the effort to define the college contributions.

Defendant's counsel asks for an award of $9,663, while Plaintiff asks for an award in his favor of $6,540. As Defendant correctly contends, "the [ex]-husband is the monied spouse and, thus, there is a rebuttable presumption that the [ex]-wife is entitled to an award of attorneys' fees" (Hof v Hof, 131 AD3d 579, 581 [2d Dept 2015], citing Domestic Relations Law § 237). The Court perceives nothing in this proceeding that would rebut that presumption. As to the amount, "[t]he decision to award an attorney's fee in a matrimonial action lies, in the first instance, in the discretion of the trial court" (Piccininni v Piccininni, 176 AD3d 880, 881 [2d Dept 2019] [internal quotation marks omitted]). In exercising its discretion, the Court looks to "the financial circumstances of the parties and the circumstances of the case as a whole, including the relative merits of the parties' positions and whether either party has delayed the proceedings or engaged in unnecessary litigation" (id.). Based on the evidence before the Court, the Court does believe there this proceeding was initiated by the father's refusal to pay a proportionate share of the college expenses and his insistence, conveyed through an email, on a reduction in child support to finance the costs. There is evidence that the father in an email before the proceeding was commenced proposed to the mother that he would reduce his child support by an amount necessary to cover the college expenses. In essence, the father's position would have required the mother to concede a further deviation in presumptive child support payable to the mother to cover the cost of daughter's college expenses. Nothing in the agreement justifies that posture by the father. This Court has, in the past, refused to countenance a parent who holds their breath while the child attends college, declines to finance the cost as it accrues and then, after their spouse has financed up-front costs, seeks to negotiate a lesser deal in the process of expensive litigation.

While this Court considers the father's posture to justify a fee award, it does not believe a fee award in the full amount requested is justified, given the relative financial circumstances of the parties. This Court also cannot ignore the fact that these parents jointly neglected to agree on a method of financing their daughter's college education, when it must have been readily apparent when they signed their separation agreement that their daughter — whose parents and older brother attended college — would follow in their footsteps. In that regard, both parents share some culpability in this proceeding and its lengthy delays.

Accordingly, in the Court's discretion, Defendant's request for fees is granted and she is awarded FIVE THOUSAND DOLLARS ($5,000.00) in attorney's fees, to be paid within 30 days of the date of this Decision. The father's request for fees is denied.
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Footnote 1:Apparently, the wife has yet to receive her marital share of the husband's New York State deferred compensation account. However, she acknowledges that the sums in her share could exceed $150,000 and, in this Court's view, these sums could provide an adequate source of funding for the wife's contribution, as well as the father's.

Footnote 2:The parties, in their agreement defined college expenses for their son as including applications, fees, tuition, room, board, school fees, lab fees and books. The Court applies this agreed definition to the costs for the daughter as well.

Footnote 3:This Court is aware that the daughter has already matriculated for several semesters. However, the contributions of both parents should be applied to all past and future semesters and to the extent that an accounting of contributions by the respective parents is required to achieve the allocation set forth in this opinion, the parents should conduct that accounting and grant offsets or credits to future expenses as required before an order is submitted to the Court."