CHILD SUPPORT - COLLEGE EXPENSES

Spinner v. Spinner, 2020 NY Slip Op 6307 - NY: Appellate Div., 2nd Dept. November 4, 2020:

"The Supreme Court also directed the plaintiff to contribute to the college expenses of the parties' children. "The court may direct a parent to contribute to a child's college education pursuant to Domestic Relations Law § 240(1-b)(c)(7)" (Bogannam v Bogannam, 60 AD3d 985, 986; see Repetti v Repetti, 147 AD3d 1094, 1097). "However, when college is several years away, and no evidence is presented as to the child's academic interests, ability, possible choice of college, or what his or her expenses might be, a directive compelling [a parent] to pay for those expenses is premature and not supported by the evidence" (Bogannam v Bogannam, 60 AD3d at 986; see Repetti v Repetti, 147 AD3d at 1097; Felix v Felix, 87 AD3d 1106, 1108). At the time of trial, the parties' younger child was 14 years old, and no evidence was presented concerning her academic ability, interest in attending college, choice of college, or the expenses attendant with college. Accordingly, it was premature for the court to direct the plaintiff to contribute to the college expenses of the parties' younger child (see Repetti v Repetti, 147 AD3d at 1097; Felix v Felix, 87 AD3d at 1108)."

DIVORCE AND COLLEGE EXPENSES

Little kids, little problems; big kids, big problems - this rule also applies in matrimonial matters and in this case, the big problem is college expenses.

Tucker v Tucker, 2020 NY Slip Op 50575(U), Decided on May 13, 2020, Supreme Court, Monroe County Dollinger, J.:

"This matter revives this Court's view of a matrimonial "Civil War." At the settlement of a divorce, a couple, rather than confront future difficulties, postpones the most costly — paying for college education — until the issue reaches a crescendo as the children attend college.

Then, with large costs looming, conflict — who should pay what and what role does the child's relationship with the non-paying parent play, if any — erupts and, often times, as here, the conflict turns decidedly uncivil. In this instance, the undisputed lack of any contact between father and daughters for more than a decade moves this matter out of the "uncivil" category and into "hostile" territory.

This couple have two children: one is over 21 and the second is 19. It is undisputed that [*2]the couple always anticipated that children would attend college. In the judgment of divorce, the couple agreed that there were 529 accounts established to fund the cost of their children's college education.[FN1] The stipulation provided:

. . . there are certain accounts held by the defendant for each of the two children for the purpose of funding as much as possible the cost of their college education . . . The husband warrants and represents that he shall continue to maintain those accounts for each of the children.

The father was the trustee of the accounts and there is no evidence before this Court that anything other than marital funds were deposited into the accounts. The funds matured over time. The father also warranted that the mother would be entitled to a statement on a quarterly basis as to the status of those accounts.

The mother alleges that in 2014 the older child's account had approximately $93,000 in it. But, the mother further alleges that the father did not use the 529 accounts for strictly tuition-or-college-related expenses and withdrew more than $17,000 to finance trips for the daughters while they were in high school. In this application, the wife alleges that the older daughter's 529 account was depleted in March, 2019, but the child continued to attend college and further that the father has refused to reimburse the mother for the remainder of the older daughter's college expense. The current amount of unreimbursed educational expenses is $27,229.99. As a result of the father's failure to pay or use the 529 to pay college expenses, the mother has incurred significant debt. The mother seeks an order directing the father to pay for the children's college expenses, a full accounting of the funds withdrawn from the children's 529 accounts, reimbursement to the mother of all out-of-pocket college expenses, and other relief including an award of attorneys fees.

In response to the wife's application, the father crossed moved to dismiss the complaint or, in the alternative, to transfer the venue of this matter to Onondaga County, the site of the original divorce stipulation. In seeking dismissal, the father argues that he never agreed to pay for all four years of college or the costs associated for either daughter. The father argues that he did what he promised to do: he maintained the 529 plan accounts for 15 years and then used the money for the children's expenses for college and preparing the children to attend college. In addition he argues that he has now paid 100% of all the associated cost for his daughters college education through the 529 accounts but the mother has paid nothing.

Finally, the father argues that he has no current relationship with his children and has not had any relationship with them for more than a decade. He alleges that the cause of breakdown was the mother's persistent pattern of exclusion and derogation of his role as a parent. He claims that as a result of this pattern of alienation, the children have forfeited any claim against him for financing college costs and the mother has surrendered any claims to enforce the college cost requirements in their agreement. The mother, in reply papers, vigorously denies those allegations and claims the daughter's estrangement from their father was a self-inflicted wound caused by his own behaviors a long time ago.

Initially, this Court declines to change the venue of this action. The daughters and mother have lived in Monroe County for more than a decade and other actions, involving the parents, have been previously venued in Monroe County Family Court. There is no evidence that the convenience of witnesses would be impacted or any claim that production of documents or other information would be impaired by venue here. The father's request to change venue is denied.

Second, this Court concludes that the current dispute does not involve an interpretation of the divorce stipulation. The father rightfully notes that the stipulation did not require him to finance his daughter's college education out of his own pocket. Therefore, this Court holds that the unambiguous terms of the agreement do not require him to finance any portion of his daughter's college costs. If the parents had intended to create an independent obligation on the father's part to finance college costs, the agreement could have easily included that language. It does not. But, while there is no interpretation question before the Court, the issue of the father's compliance with his stated obligation — to maintain the 529 accounts to fund "as much as possible" of the daughter's education costs — remains. The stipulation does not permit the father to use the 529 accounts for any purpose other than to fund "as much" of the college costs as possible. The mother raises factual issues of the father's compliance with that requirement and, given disputed facts relating to withdrawals, the alleged existence of separate accounts for each daughter and the ultimate amounts remaining (if any) in the accounts, this Court needs a hearing to resolve those issues.

Third, the mother makes a claim that even if the agreement does not require the father to fund the college costs for the daughters. Pursuant to DRL § 240 (1—b)(c)(7), "[i]n certain circumstances, a parent may be required to contribute to a child's higher education expenses even in the absence of an agreement to do so' " (Reiss v Reiss, 56 AD3d 1293, 1294 [4th Dept 2008]; see DRL § 240 (1—b)(c)(7) [the court, "as justice requires," has discretion to order a parent to pay college expenses, considering "the circumstances of the case and of the respective parties and . . . the best interests of the child"]). The "circumstances of the parties" that this court considers include "the educational background of the parents, the child's academic ability and the parent's financial ability to provide the necessary funds" (McDonald v McDonald, 262 AD2d 1028, 1029 [4th Dept 1999]).
There is a little question that the facts alleged in this case could lead to a conclusion that the father, under the standards set forth above, should contribute to financing the children's college education. His career as a physician attests to his commitment to education and the mother similarly has a college degree. Generally, however, such a determination requires a hearing (see McDonald, 262 AD2d at 1029), and thus this Court declines to make any judgment on that issue in advance of such hearing.

Under these circumstances, the Court concludes:

(A) the request to order the father to fund college expenses is denied without prejudice and referred to a hearing;(B) the request for the father to provide a full accounting of the children's 529 accounts is granted and he is ordered to provide the account statements for the last five years and all records evidencing the disbursement and use of any funds withdrawn from those accounts, including where the funds were deposited and ultimately spent;(C) the request for reimbursement to the mother for college costs incurred is denied [*3]without prejudice and referred to a hearing;(D) the request to replenish 529 accounts for funds withdrawn to pay for trips by the children, the College Assistance Program or other trips is also is denied without prejudice and referred to a hearing; and,(E) the request for attorneys fees is denied without prejudice and referred to a hearing.

The father's cross-motion to dismiss the mother's application is denied as is his request to change venue to Onondaga County. His request for attorneys fees is denied without prejudice and referred to a hearing."

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." 

DIVORCE - REQUEST TO ALLOCATE FUTURE COLLEGE EXPENSES

Weidman v Weidman, 2018 NY Slip Op 04027, Decided on June 6, 2018, Appellate Division, Second Department:

"The court, however, should have denied, as premature, the defendant's request to allocate between the parties responsibility for the future college expenses of the parties' then 13-year-old child (see Marin v Marin, 148 AD3d 1132, 1136; Repetti v Repetti, 147 AD3d 1094, 1097; Dochter v Dochter, 118 AD3d 665, 666; Bogannam v Bogannam, 60 AD3d 985, 986)."

THE SUNY CAP

Friedman v Friedman 2016 NY Slip Op 06469 Decided on October 5, 2016 Appellate Division, Second Department:

"Contrary to the defendant's contention, the Supreme Court properly concluded that he did not establish any basis to modify the stipulation or the judgment of divorce (see generally Matter of Brescia v Fitts, 56 NY2d 132). Further, we find no reason to disturb the court's determination that the plaintiff sufficiently complied with the terms of the stipulation requiring the parties to "meet and jointly discuss the selection of college for each child and, with input from the child, agree on the selection of a college for each child" (see Gretz v Gretz, 109 AD3d 788, 789; Matter of Sebastiani v Locatelli, 11 AD3d 701, 701; Regan v Regan, 254 AD2d 402, 403; cf. Halligan v Wesdorp, 264 AD2d 466, 467).

Contrary to the defendant's contention, the Supreme Court did not err in rejecting his request to impose a SUNY cap on his obligation because neither the stipulation nor the judgment of divorce made reference to a SUNY cap (cf. Balk v Rosoff, 280 AD2d 568, 569; Halligan v Wesdorp, 264 AD2d at 467; see generally Matter of Heinlein v Kuzemka, 49 AD3d 996, 998).

Additionally, the Supreme Court properly denied that branch of the defendant's motion which was, in the alternative, for a determination that his pro rata share of the college expenses was 78% and the plaintiff's share was 22%, and granted that branch of the plaintiff's cross motion which was, in effect, for a determination that the defendant's pro rata share was 100%. A separation agreement that is incorporated, but not merged, into a judgment of divorce is a legally binding independent contract between the parties which must be interpreted so as to give effect to the parties' intentions (see Matter of Gravlin v Ruppert, 98 NY2d 1, 5). Here, the parties' stipulation specifically provided, in pertinent part: "[T]he parties agree that the children's college education expenses . . . shall be financed by the custodial accounts currently maintained for their benefit, as well as any future accounts that may be established for their benefit. . . . If the children's college education costs exceed the amount of the respective custodial accounts, the parties shall contribute to the remaining cost of the children's education on a pro rata basis based upon their respective incomes" (emphasis added). Thus, pursuant to the express terms of the stipulation, after the amounts available in the custodial accounts were extinguished, the parties were required to contribute to the children's additional college costs on a pro rata basis (see generally Matter of Heinlein v Kuzemka, 49 AD3d at 998). Morever, as the stipulation did not include operative language as to whether the parties would maintain employment and there was no dispute that the plaintiff was unemployed, the court did not err in concluding that the plaintiff's pro rata share of the additional college costs was 0%."

For a discussion of steps on drafting SUNY cap language, see  http://nydailyrecord.com/2014/01/24/commentary-a-practitioners-15-step-primer-on-the-suny%E2%80%88cap/

CHILD SUPPORT - ARE COLLEGE EXPENSES ALWAYS AWARDED?

Dougherty v. Dougherty, 2015 NY Slip Op 6705 - (September 2, 2015 App. Div. 2nd Dept. ):

""Unlike the obligation to provide support for a child's basic needs, support for a child's college education is not mandatory'" (Matter of Lynn v Kroenung, 97 AD3d 822, 823, quoting Cimons v Cimons, 53 AD3d 125, 127). "Instead, absent a voluntary agreement, whether a parent is obligated to contribute to a child's college education is dependent upon the exercise of the court's discretion in accordance with Domestic Relations Law § 240(1-b)(c)(7)' [Cimons v Cimons, 53 AD3d at 127], and an award will be made only as justice requires'" (Matter of Lynn v Kroenung, 97 AD3d at 823, quoting Domestic Relations Law § 240[1-b][c][7] [some internal quotation marks omitted]; see Matter of Levison v Trinkle, 70 AD3d 827, 830; Cimons v Cimons, 53 AD3d at 129). "[A] court must give due regard to the circumstances of the case and the respective parties, as well as both the best interests of the child and the requirements of justice" (Powers v Wilson, 56 AD3d 642, 643)."

But in this case, the court held: "Under the circumstances of this case, the Supreme Court providently exercised its discretion in apportioning 72% of the subject children's educational expenses to the defendant, and 28% to the plaintiff."