Wednesday, June 25, 2008

Obligation For College Expenses Not Subject to Deviation Rules

In Cimons v Cimons, --- N.Y.S.2d ----, 2008 WL 2457243 (N.Y.A.D. 2 Dept.) the Second Department in an opinion by Justice Angiolillo, held that, under the circumstances presented here, the obligation to provide for the future college expenses of the children was not part of the parties' basic child support obligation and therefore was not subject to the CSSA requirement that any deviation from statutorily-mandated childsupport obligations must be recited and explained in a stipulation of settlement. Even though the parties violated the CSSA by failing to recite and explain in their stipulation why they deviated from CSSA standards in providing basic child support, and the basic child support provisions were properly vacated as a consequence, the provision concerning future college expenses survived the vacatur, and was enforceable.

The parties entered into a stipulation of settlement, which was incorporated but not merged in a judgment of separation. Subsequent to the entry of the judgment, the father moved to vacate the child support and related provisions of the stipulation, alleging that the stipulation failed to comply with the "opt-out/deviation" provisions of the CSSA contained in Domestic Relations Law 240(1-b)(h). The Supreme Court determined, in effect, that the parties' agreement deviated from the provisions of the CSSA with regard to the calculation of "basic child support." Since the parties failed to comply with the provisions of Domestic Relations Law 240(1-b)(h), those basic child support provisions were not enforceable, and the Supreme Court vacated those provisions of the parties' stipulation relating to their basic child support obligation for their three children, ultimately scheduling a hearing for a calculation of basic child support pursuant to the CSSA. However, Supreme Court denied the father's motion to vacate the separate provisions of the stipulation that related to the parties' agreement to provide for their children's future college expenses.
The Appellate Division affirmed. It noted that a parent has an obligation to provide support for his or her child's basic needs, an obligation which is addressed in Domestic Relations Law s 240(1- b)(c)(1), (2). Unlike that basic obligation, support for a child's college education is not mandatory. Absent a voluntary agreement, a parent might be required to provide support for his or her child's attendance at college, but the determination of that obligation is dependent upon the exercise of the court's discretion in accordance with Domestic Relations Law s 240(1- b)(c)(7).
Domestic Relations Law 240(1-b)(h) requires that any agreement or stipulation voluntarily entered into between the parties, and presented to the court for incorporation in an order or judgment, must include provisions: (1) stating that the parties have been advised of the provisions of the CSSA; (2) stating that the basic child support provisions of the CSSA would presumptively result in the determination of the correct amount of child support to be awarded; (3) stating what the amount of basic child support would have been if calculated pursuant to the CSSA, if the parties' stipulation or agreement deviates from the basic child support obligation; and (4) setting forth the parties' reason or reasons for deviating from the CSSA calculation, if they have chosen to deviate.The requirements of Domestic Relations Law s 240(1- b)(h) may not be waived byeither party or by counsel.
The Appellate Division noted that in contrast to the add-ons for child care expenses and future reasonable health care expenses, which must be awarded and prorated in the same proportion or percentage as each parent's income bears to the combined parental income, the add-on for educational expenses is within the court's discretion, both as to whether an award of such expenses is to be made in the first instance, and the parties' share of any amount awarded. Domestic Relations Law 240(1-b)(c)(7). Where the parties' stipulation or agreement fails to comply with the requirementsof Domestic Relations Law s 240(1-b)(h), it is fundamental that the basic childsupport provisions of the agreement are invalid and cannot be enforced. Thatportion of the agreement must be set aside and the parties' basic child supportobligation must be recalculated through the application of the CSSA. Nonetheless, the invalidity of the basic child support obligation, due to a deviation from the CSSA standards without full compliance with Domestic Relations Law 240(1-b)(h), does not necessarily require that the entire stipulation be vacated. That a portion of an agreement may be invalid and unenforceable does not necessarily preclude the enforcement of other portions of an agreement. (Ferro v. Bologna, 31 N.Y.2d 30).
The Court held that the determination as to which additional aspects, if any, of the parties' stipulation must be vacated along with the basic child support provision depends on the circumstances of the particular case and the nature of the obligations addressed in the other provisions of a stipulation. Some provisions may be so directly connected or intertwined with the basic child support obligation that they necessarily must be recalculated along with the basic support obligation. Unlike child care expenses and unreimbursed health care expenses, education expenses are not directly connected to the basic child support calculation. Initially,education expenses differ from these other expenses in that, in the absence of an agreement to pay education expenses, the determination as to whether or not such expenses will be paid is within the court's discretion (see Domestic Relations Law 240[1-b][c][7] ), while child care and unreimbursed health expenses are mandatory. Also, education expenses differ in that such expenses are not necessarily prorated in the same proportion or percentage as each parent's income bears to the combined parental income.
The Court held that the entirety of the stipulation should be considered in determining whether the parties' agreement evinces that trade-offs were made which involved the basic child support figure. In such a situation, expenses that are not directly connected to the CSSA calculation, or even to child support, may be so closely intertwined with the basic child support provision as to require vacatur.
The Court cited as an example Farca v. Farca (271 A.D.2d 482), where the wife waived maintenance and equitable distribution of property, upon the understanding that she would receive a certain level of child support. When the court vacated the basic child support provision, it vacated all of the financial provisions of the stipulation and judgment of divorce. The same remedy was applied in LePore v. LePore (276 A.D.2d 677, 678), where the Second Department held that the provisions of the parties' agreement regarding maintenance and financial obligations for college expenses were so "closely intertwined" with the basic child support provisions as to require those provisions to be vacated along with the basic child support provisions. In contrast, it held in Warnecke v. Warnecke (12 AD3d 502), that the record did not support a finding that the maintenance provisions of a stipulation were closely intertwined with the child support provisions. The court reached the same result in Toussaint v. Toussaint (270 A.D.2d 338), where it held that the entire stipulation did not have to be vacated, but only those provisions of the stipulation as failed to comply with the requirements of the CSSA.
In Toussaint, the provisions relating to educational and health costs were vacated along with those relating to basic child support. The father in Toussaint had agreed to pay all health expenses, including costs of a health insurance policy, as well as medical, dental, nursing, opthalmologic, orthodonic, and every other similar expense, and to pay all tuition and related expenses for private school, including uniforms. The father also agreed to be responsible for all college and graduate school expenses. While there was little doubt that the health care expenses in Toussaint were directly connected to the CSSA calculation, it was for the court to determine whether the education expenses were to be treated similarly. Since the education expenses, including those for college, did not receive separate treatment in the parties' stipulation, they were also deemed to be directly connected to the CSSA calculation. Specifically, the agreement merely recited a list of obligations, of which the father agreed to pay the total expense. Accordingly, the education expense provisions of the agreement inToussaint were not separate from all the other child support aspects of theagreement.
This case fell within the ambit of cases that clearly stated that the tuition expense aspect of a college education is distinct from basic child support.
The parties' stipulation, insofar as it pertained to their support for their children's attendance at college, recited as follows: "The parties further acknowledge, each to the other, that it is their anticipation that each of their children attends college. And in this regard, the parties agree to contribute pro rata to income to the minimum of a SUNY education. That is State of New York education for a New York State resident for each child and shall contribute more than that minimum, if possible, based upon their respective financial circumstances at the time each child makes application to college. College expenses with respect to the parties' obligation, to pay for same pro rata to income is defined as including but not limited to tuition, room and board, mandatory books, supplies and fees, pre-college testing classes and actual testing, such as the SATs, scholastic aptitude tests and reasonable number of applications to colleges for purposes of the child or children reviewing campuses for purposes of making a final decision with respect to the selection of college."
The court held that to the extent that the commitment to meet future college expenses addressed room and board, the agreement did not deviate from the CSSA as it provided that the parties will contribute to such expenses pro rata to income. The stipulation also included extensive provisions as to how the parties are to deal with various custodial funds that had been earmarked for college education expenses, including a recital that such funds would be utilized in the first instance beforetriggering the parties' obligation to contribute to college expenses proportionally based on their income.
There was nothing in the record that would support a finding that the father agreed to pay a share of college expenses as a trade-off against some other expense. When the parties agreed to equitable distribution and traded off certain assets, the stipulation directly addressed those trade-offs. Thus, the wife received sole title to the marital residence in exchange for waiving any claim to the husband's pension, IRA, or deferred-compensation account. Similarly, the wife waived any claim to certain stock in exchange for the husband's waiver of any claim to a joint bank account. Additionally, the provisions of the parties' stipulation regarding college expenses were distinguishable from those provisions of the stipulation based upon the calculation of basic child support. In particular, the stipulation provided: "Mr. Cimons shall pay child support for the benefit of the children and to the age of 21 or 22, if in college." The father's agreement to support his children and contribute to their college education expenses beyond the age of 21 years inured primarily to the benefit of the three children. As it is the intent of the CSSA to protect the children, to the extent possible, from the economic consequences of their parents' divorce or separation, it would seem particularly unjust to allow the father, whose adjusted income, in 2005, after deduction of all mandatory deductions including his maintenance obligation, was reported as $130,000, to wield noncompliance with the CSSA as a sword to eviscerate his commitment to provide his children with support for their college education.
The court noted that in Fasano v. Fasano (43 AD3d 988), the Second Department found that the parties to the relevant agreement did not opt out of the CSSA standards with respect to basic child support, but that a cost-of-living adjustment (hereinafter COLA) included in the agreement represented potential future deviations from the CSSA basic child support obligation. The remedy was to vacate the COLA provision, while the basic child support provision of the agreement was not vacated. Similarly, the vacatur of the basic child support provisions of the stipulation here did not warrant thevacatur of the provisions respecting college education expenses.
The parties' stipulation dealt with their commitment to meet their children's college expenses in an extensive provision which was separate and discrete from the child support provision. This case was unlike Toussaint, where the reference to future college expenses was but one phrase in a long list of health and education expenses added on to the child support obligation. Here, by contrast, the parties separately addressed their commitment that their children attend college, by providing that they would share, pro rata, at a minimum, the costs of a State University of New York education, that they would contribute more than that minimum if able, that certain custodial accounts designated for college expenses would be applied to the college expenses prior to the parties' obligation to make pro rata contributions, and that any surplus in such custodial accounts would "spill over" from child to child.
The provisions of the parties' stipulation relating to future college expenseswere thus separate and distinct from the provisions relating to basic childsupport. Those two discrete sets of provisions were not closely intertwined.Accordingly, the Supreme Court properly denied that branch of the father's motionwhich was to vacate the separate provisions of the stipulation that related to theparties' agreement to provide for their children's future college expenses.

16 comments:

  1. Anonymous8:56 AM

    As the father in the aforementioned case, what the Second Department did was completely write out the requirement that a party be advised of 240(1-b) as part of a valid stipulation addressing college--in effect, reversing the clear implications of Bill v. Bill that all add-ons are part of 240(b-1) for purposes of advisement. The court got around this by simply ignoring Bill and foicussing solely on the opt-out langauge.

    Because I was was told by my original attorney that all the costs recited in the stipulation for college were mandated under the law, I felt I had no choice to accept them. I certainly woul have pursued the room and board offset if I knew it was available. While this gives rise to a strong legal malpractice claim against my original attorney, had I been informed of the CSSA's treatment of educational expenses as required in a stipulation, the provisions in the Stipulation never would have been part of the agreement in the first instance. Rather than sticking with their bright line rule, the Court has opened up the door for all sorts of subjective pleadings on this issue.

    It was additionally disingenous for the Second Department to assert that I was using non-compliance with the CSSA as weapon to eviscerate my commitment to pay for college for my children. I sought a remand to the lower court to address college cosst consistent with the CSSA and Second Department practice and one of the reasons I tried to sustain the marriage was to provide sufficient resources so our children could go to the school of their choice. This was part of the record in the initial motion to vacate.

    To be honest, my experience as a spouse blind-sided by a wife's desire to leave the marriage--from O'Brien to the ethics of the attorneys has been the equivalent of a legal Bataan Death March--but so be it, that's the wonderful world of Family Law in the United States.

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