STIPULATION REDUCING CHILD SUPPORT ARREARS SET ASIDE

MATTER OF MICHELLE B. v. THOMAS Y., 2022 NY Slip Op 50020 - Kings Co. Family Court 2022:

"It is well-settled that the Family Court has continuing jurisdiction over support proceedings and is empowered to determine applications to modify or enforce judgments and orders of support (see Matter of Saratoga County Support Collection Unit v. Hubert, 160 AD3d 1071 [3rd Dept. 2018]). Pursuant to FCA § 453, proceedings under this part "shall be originated by the filing of a petition containing an allegation that the respondent has failed to obey a lawful court order" (Matter of Pudvah v Pudvah, 172 AD3d 1475 [3rd Dept. 2019; see Matter of Messick v Mesick, 71 AD2d 737 [3rd Dept. 1979]). Generally, stipulations of settlement settling those petitions "are favored by the courts and a stipulation made on the record in open court will not be set aside absent a showing that it was the result of fraud, overreaching, mistake or duress" (Matter of Abidi v Antohi, 64 AD3d 772, 773 [2nd Dept. 2009]; see Matter of Blackstock v. Price, 51 AD3d 914 [2nd Dept. 2008]). However, the law is also quite clear that the court shall not reduce or annul child support arrears prior to the making of an application (see Family Court Act § 451[1]; Matter of Dox v Tynon, 90 NY2d 166 [1997]). Failure to file a petition for the vacatur or reduction of arrears renders the Family Court without subject matter jurisdiction to hear the matter (see Matter of Pudvah, 172 AD3d at 1476; Matter of Sheehan v Sheehan, 221 AD2d 897, 898 [3rd Dept. 1995]).

Applying these principles to the case at bar, the Mother's Objections must be granted. The record reflects that the Mother properly initiated an enforcement proceeding alleging that Father had not paid arrears owing on the Support Order amounting to $206,055.44, for the subject Child. Although the Father's obligation to pay current child support ended when the Child was emancipated on November 15, 2013, he remained obligated to pay those arrears and she had every right to seek enforcement for those outstanding arrears from the Father (see Beckmann v Beckmann, 160 AD3d 799, 800 [2nd Dept. 2018]). After several appearances, on August 3, 2020, the Mother consented to vacate the arrears beyond the amount due to Father by NYCERS in exchange for a lump sum payment.

Nevertheless, the Court of Appeals and the Appellate Division have reminded us that "a court has no discretion to reduce or cancel arrears of child support which accrue before an application for a downward modification of the child support obligation" (Beckmann v Beckmann, 160 AD3d at 800, quoting Matter of Gardner v Maddine, 112 AD3d 926, 927 [2nd Dept. 2013]; see Matter of Dox v Tynon, 90 NY2d at 175-176). Of course, an exception to that rule exists where there is an agreement by the parties to vacate accumulated arrears under a proper petition. This Court acknowledges that the parties may enter into a valid agreement to vacate arrears, but, in this case, neither party has filed the jurisdictionally required petition to vacate, adjust arrears or downwardly modify the child support arrears owed by the Father (see e.g. Matter of Essex County Child Support Enforcement Unit v Crammond, 185 AD3d 1190, 1191 [3rd Dept. 2020] [mother's petition to terminate father's child support and forgive arrears permitted court to issue consent order terminating support obligation and vacating arrears]). In the absence of a such a petition, this Court finds that the Magistrate did not have subject matter jurisdiction to accept the parties' Agreement while adjusting the significant arrears owed by the Father.

Even if there was valid petition pending before the Magistrate, this Court concludes that the Agreement fails due to unconscionability and mutual mistake. When the parties entered into the Agreement, it was unclear whether a QDRO could be set up with NYCERS to facilitate the Mother's receipt of the lump sum payment. The Magistrate informed the parties that it was a complicated process thereby advising the Mother to seek legal representation to assist her with the process. This case was adjourned for several court appearances where the Magistrate herself received updates on the progression of the QDRO. It becomes apparent that the parties should have completed the exploration and investigation into the QDRO before an Agreement could be knowingly and voluntarily reached. Moreover, prior to rendering a decision on the Motion, the record reflects that the Magistrate learned the following: that Mother did not qualify for a QDRO because she is not a former spouse; that she would only be entitled to monthly allotments under an Income Execution Order; and that as of April 11, 2019, Father had an outstanding loan in the amount of $55,736.88, which served to reduce his retirement allowance. Given his prior willful violation and his recalcitrant failure to pay accumulated child support arrears, there is a very slim possibility that the Father would pay the NYCERS loan prior to his retirement date.

Moreover, the existence of a mutual mistake may permit vacatur of an Agreement when "the mistake existed at the time the stipulation was entered into and that it was so substantial that the stipulation failed to represent a true meeting of the parties' minds" (Wit Capital, Ltd. v Obigor, 33 AD3d 859 [2nd Dept. 2006]; see Mahon v New York City Health & Hosps. Corp., 303 AD2d 725 [2nd Dept. 2003]). Here, a mutual mistake was made when there was an assumption that upon the execution of that QDRO, the Mother would be entitled to receive $67,674.36 in a lumpsum payment from Father's NYCERS account. Based on this record, the Court finds that the Magistrate should not have allocuted the parties prior to the filing of an appropriate petition and the completion of the investigation into the QDRO. As such, the Magistrate erred when she denied the Mother's motion to vacate the August 3, 2020 Agreement between the parties.

In accordance with the foregoing, the Court grants the Mother's Objections in their entirety and the matter is hereby remanded to Part 29 for the Magistrate to vacate the Agreement placed on the record on August 3, 2020, restore the Violation Petition to the calendar, and reinstate all outstanding arrears by the Father. The parties and counsel shall appear at a date to be scheduled by the Magistrate. This constitutes the decision and order of the Court.

[1] The Mother attached a letter dated April 11, 2019 from NYCERS to Father, which described various options available to Father at retirement. Only Scharon Y. is listed as a beneficiary. The letter also indicates that the Father has an outstanding loan in the amount of $55,736.58, and the loan would reduce Father's maximum retirement allowance by $3,947.63 per year."