If you delay going to court after an event that changes rights and obligations, you do so at your peril.

In Fortgang v. Fortgang, the parties were divorced in May 2011. Under their stipulation of settlement, the parties agreed that the husband would pay $2,600 per month in basic child support for the parties’ two children. The stipulation provided that this child support obligation would decrease when the parties’ older child became emancipated, but did not provide the reduced amount.

In December 2013, the older child became emancipated, but the husband continued to pay the full child support amount. In November 2015, the parties’ younger child became emancipated, but the husband continued to pay child support for several months thereafter.

In December 2016, in response to motion by the wife, the husband cross-moved, for the first time, to recoup child support overpayments. Suffolk County Supreme Court Justice David T. Reilly granted the husband’s cross motion, and awarded him a money judgment against the wife for $30,422.32 in overpaid child support.

Continue Reading Recouping Overpaid Child Support: Two Lessons

Leaving parenting-time decisions to the future agreement of the parents is not a great idea, particularly with quarreling parents. So held the Appellate Division, Second Department, in its February, 2019 decision in Cabano v. Petrella.

In that case, the parents had entered into a December, 2013 so-ordered stipulation which, among other things, reaffirmed their joint legal custody, reaffirmed the mother’s residential custody, and set forth a detailed parental access schedule. That arrangement remained substantively in effect in a so-ordered modification stipulation entered in October, 2016.

In June, 2017, the father petitioned for a modification of the parental access schedule (apparently at least the third proceeding after parenting rights were initially established). After a hearing, Suffolk County Family Court Referee Kerri N. Lechtrecker granted the father additional parental access with the child.

Further, the Referee modified the number of hours of access to which each party was entitled on the mother’s birthday, the father’s birthday, and the child’s birthday. The order provided, in effect, that the parties each would have parental access with the child on his or her own birthday, and on the child’s birthday, if the birthday was during the other party’s parental access, for two hours on a school day and for four hours on a non-school day. The order required the parties to cooperate in reaching an agreement on the details.

The mother appealed. The Second Department modified that order.

Continue Reading Don’t Leave Future Parenting-Time Decisions for Later Agreement

What happens when, under a post-divorce QDRO, retirement benefits are paid to the “wrong” beneficiary? The Appellate Division, Second Department, in its March 6, 2019 decision in Schatz v. Feliciano-Schatz held that the proceeds may be reached by the correct beneficiary

In 1998, Susan (W1) and Aloysius (H) were divorced. In February 2004, H married Carmen (W2). In December 2006, H retired from his employment and began receiving benefits from his New York Stock Exchange Retirement Plan. H elected a joint and survivor annuity with W2 named as joint annuitant. In November 2011, H and W2 were divorced.

In June, 2012, H and W2 entered into an amendment to their 2011 stipulation of settlement and judgment of divorce. Each of them waived their rights to each other’s retirement plans. The amendment also indicated that in the event that either of the parties received payments in contravention of the agreement, the benefits would be turned over to either a beneficiary designated by the other party or to the other party’s estate.

Subsequent to executing the amendment, W2 remained the only named beneficiary on H’s retirement plan. On May 21, 2013, W1 remarried H, and 9 days later on May 30, 2013, H died. Upon H’s death, benefits were paid out to W2 as the named beneficiary under H’s retirement plan.

W1 (now W3) and the administrator of H’s estate (the plaintiffs) commenced this action to recover the proceeds. They alleged that the plaintiffs were entitled to the decedent’s retirement benefits, as W2 had waived her rights to the retirement benefits pursuant to the amendment. The plaintiffs moved for summary judgment, and W2 (the defendant) cross-moved for summary judgment dismissing the complaint.

Orange County Supreme Court Justice Maria Vazquez-Doles granted W2’s motion and dismissed the complaint. The plaintiffs appealed. The Second Department, in effect, reversed, granting the plaintiffs’ motion.

Although ERISA prohibits the assignment or alienation of benefits while they are held by the plan administrator, once they are paid to the beneficiary, the funds are no longer entitled to that protection. The appellate court agreed that W2 validly waived her entitlement to the subject retirement benefits. The amendment stated that H and W2 waived any and all claims that “he or she may have or may hereafter acquire or possess to share in any pension, profit-sharing, IRA, 401(k) plan or any other retirement or deferred compensation plan established for the other party.” That waiver language was sufficiently explicit to effectuate a valid waiver of benefits under the subject plan. Moreover, contrary to W2’s contention, the language of the waiver requiring that payments received in contravention of the waiver be turned over to a designated beneficiary or the estate of the decedent does not violate the anti-alienation provisions of ERISA.

The Second Department also noted that W1 failed to demonstrate that she was entitled to a nunc pro tunc QDRO; that she had an existing interest in the subject pension benefits prior to the decedent’s death. While a QDRO may be obtained after the death of the plan participant, a QDRO only renders enforceable an already-existing interest.

Comment: Check your agreement boilerplate for the language in this decision.

Richard M. Mahon II, of Catania, Mahon, Milligram & Rider, PLLC, of Newburgh, represented W1. Mark D. Stern, of Goshen, NY, represented W2.

In a February, 2019 decision, the Appellate Division, Second Department, foiled the cooperative efforts of previously-divorced parties, by their settlement of post-judgment issues, to avoid an interim fee award to the ex-wife’s counsel to prosecute an appeal.

In Rhodes v. Rhodes, the parties were married in 1993, had three children, and divorced in 2008. In 2013, the ex-husband successfully moved to modify the parties’ custody arrangement and, in a December, 2014 order, was granted residential custody of the children. The ex-wife appealed from that order.

In May 2015, the ex-wife moved for interim appellate attorney’s fees and costs. In an August 25, 2015 order, Former Suffolk County Supreme Court Acting Justice Marlene L. Budd granted that motion, awarding the ex-wife $20,000 in attorney’s fees and costs “for the prosecution of the appeal, with leave to apply for additional sums upon the completion of the appeal.” The ex-husband was directed to pay those attorney’s fees and costs to the ex-wife’s then-attorney, Karyn A. Villar, PLLC (hereinafter Villar), within 20 days of the order.

When payment was not made, on September 23, 2015, Villar moved to hold the ex-husband in civil contempt of the fee order. The ex-husband cross-moved for leave to renew his opposition to the ex-wife’s prior motion for interim appellate attorney’s fees and costs. The ex-husband attached to his cross motion a stipulation of settlement dated September 28, 2015, in which the parties agreed that the ex-wife would waive payment of attorney’s fees and costs owed by the ex-husband pursuant to the August, 2015 order. The ex-wife retained new counsel, and thereafter cross-moved to impose sanctions against Villar, arguing that Villar’s contempt motion was punitive and an abuse of process.

In an order dated March 7, 2016, Suffolk County Supreme Court Justice Carol MacKenzie (1) denied Villar’s motion to hold the ex-husband in civil contempt, (2) vacated the August, 2015 interim fee award and denied a fee, and (3) granted the ex-wife’s cross motion to impose sanctions against Villar, directing Villar to pay the ex-wife’s new attorneys $2,500. Villar appealed.

Continue Reading Divorced Parties Foiled in Efforts to Avoid Counsel Fee Award

A January 9, 2019 decision of the Appellate Division, Second Department, may foreshadow an increase in support enforcement proceedings in Family Court, or promote the current payment of child support obligations, or both.

In Mensch v. Mensch, the court reversed an order of Suffolk County Family Court Judge Kathy G. Bergmann that denied a mother’s objections to the denial of a counsel fee award by Support Magistrate Barbara Lynaugh.

The parties were the parents of five children. In December 2017, the mother filed a child support enforcement petition alleging that the father failed to pay $1,635 in child support from April through August, 2017. The support obligation was based on a so-ordered stipulation of settlement that survived the parties’ Judgment of Divorce.

Shortly after the petition was filed, the father paid the mother the amount sought in the petition. The mother thereafter moved for an award of the attorneys’ fees she incurred in commencing this enforcement proceeding.

Magistrate Lynaugh denied her motion. The mother filed objections that were denied by Judge Bergmann.

Reversing, the Second Department held that the denial of an award of attorneys’ fees to the mother was an improvident exercise of discretion. The father paid the arrears demanded, but only after the mother was forced to expend attorneys’ fees to commence an enforcement proceeding.

The court rejected the father’s argument that he was engaged in a dispute over whether he should be credited for payments for cell phone expenses and college expenses paid before the entry of the parties’ judgment of divorce. However, that dispute did not authorize the father to engage in self-help by withholding child support payments that he ultimately did not dispute were due and owing.

Accordingly, the mother was entitled to an award of attorneys’ fees and the matter was remitted to the Family Court to determine the amount of the mother’s reasonable attorneys’ fees incurred in connection with this proceeding.

Michael J. Miller, of Heilig, Branigan, Miller & Castrovinci, of Holbrook, represented the mother. Karen D. McGuire, of McGuire Condon, P.C., of Huntington, represented the father.

Using the state’s Child Support Enforcement Services can have unintended results. Having support payments made through a Support Collection Unit triggers a cost-of-living adjustment procedure that may result in a significant change to the court-ordered support obligations to which parties had agreed.

Consider the September 26, 2018 decision of the Appellate Division, Second Department, in Murray v. Murray. There, the former spouses in their 2001 surviving divorce settlement agreement had agreed to share joint custody of their children, with the mother having physical custody.

The parties had opted out of the basic child support obligations of the Child Support Standards Act (C.S.S.A.), with the father agreeing to pay a certain sum for child support from August 1, 2001, through January 31, 2006. The parties also executed a rider to their stipulation, in which they agreed that beginning on February 1, 2006, until both children were emancipated, the father would pay child support to the mother based on the C.S.S.A., but using the parties’ total combined income for the year 2005.

In an 2009 order, the Family Court, upon the parties’ consent, directed the father to pay $740.56 per week in child support for both children through the Support Collection Unit (the SCU).

In March 2017, the SCU notified the parties of the presumptive cost-of-living adjustment (COLA) to the father’s child support obligation authorized by Family Court Act §413-a. That would increase the father’s weekly child support obligation to $822.00.

The mother filed an objection to the cost of living adjustment pursuant to Family Court Act §413-a(3), requiring that a hearing be held for a redetermination under the C.S.S.A. After that hearing, Suffolk County Support Magistrate Aletha V. Fields, in effect, vacated the COLA increase. At the time, the subject child was 20 years old and entering her third year of college. Upon recalculating the amount of child support, Magistrate Fields fixed the father’s child support obligation at $360.00 per week. The Support Magistrate found that although the parties’ combined parental income was $371,697.08, the mother failed to set forth a basis upon which to apply the statutory child support percentage to any income above the statutory cap of $143,000.00.

The mother filed objections to the Support Magistrate’s order. However, Family Court Judge Anthony S. Senft, Jr., denied the mother’s objections. The mother appealed.

Continue Reading Child Support Payments Through Support Collection Units May Result in Unanticipated Changes

The Child Support Standards Act authorizes parents to agree to a child support obligation that deviates from the presumptive formula provided in that statute. However, if they are going to deviate from the formula, the parents must state what the obligation would have been if the formula were to be applied, and the reasons why the parties have agreed to deviate.

In its September 26, 2018 decision in Fasano v. Fasano, the Appellate Division, Second Department, held that if one of those reasons no longer applies, such is a “substantial change in circumstances” warranting a new child support determination.

The parties were married in 1993 and have two children together. In October, 2012, the parties entered into a stipulation of settlement of a prior divorce action after which that action was discontinued.

That stipulation provided that although the husband’s monthly child support obligation using the C.S.S.A. calculation would be $1,994.45 on the first $130,000.00 of combined parental income (then, the “cap”) and $2,575.61 on the total combined parental income, the parties had agreed that the husband’s monthly child support obligation would be $1,500.00. The stipulation also provided that there would be no “add-ons” or “additional health costs” added to these child support payments, even though the C.S.S.A. generally provides that each parent’s share of unreimbursed health care expenses is to be prorated in the same proportion as each parent’s income is to the combined parental income.

The stipulation contained an explanation that the deviation from the C.S.S.A. calculation was necessary “to allow the [husband] to retain the marital residence as a place for the children to be with him when they are together” and had “been agreed by the parties to be in the best interests of the children to provide them continuity and stability in their living and educational environments.”

Continue Reading A Child Support Redetermination Is Warranted If a Stated Reason Parties Deviated From CSSA No Longer Applies

It’s one of my pet topics. How do you provide — how do you write a provision awarding one spouse credit for paying down the mortgage principal while a divorce action is pending or thereafter?

Consider the August 29, 2018 decision of the Appellate Division, Second Department, in Westbrook v. Westbrook.

In April 2008, the wife commenced this action for a divorce and ancillary relief. In a pendente lite order, the Supreme Court, inter alia, directed the husband to pay temporary child support in the sum of $150 per week. The court also directed the husband to pay a majority of the carrying charges on the marital residence, which included a first mortgage on the two-thirds share of the value of the marital residence that had been purchased from the husband’s siblings, as well as a home equity line of credit (hereinafter HELOC) that was secured by the marital residence.

On or about November 24, 2009, the parties executed a stipulation agreeing, inter alia, that the husband would have exclusive use and occupancy of the marital residence effective December 1, 2009, and that the husband would pay child support to the wife in the sum of $350 per week commencing on December 1, 2009. Thereafter, the wife moved, inter alia, to increase the husband’s temporary child support obligation. In a pendente lite order dated May 21, 2010, the Supreme Court directed the husband to pay $700 per week in temporary child support during the pendency of the action.

Following the trial, as is here relevant, Suffolk County Supreme Court Justice Marlene L. Budd declined to award the husband a credit for the payments made by him during the pendency of the action to reduce the principal balances of the first mortgage and the HELOC. In addition, the court directed that the marital residence be listed for sale, and that the husband make the payments towards the first mortgage and the HELOC if he continued to reside in the marital residence until the residence was sold.

Continue Reading Calculating Divorce Credits for Mortgage and HELOC Payments

May a parent be directed to maintain life insurance in a Family Court support proceeding? Do an aunt and uncle awarded primary residential and, with the father, joint legal custody of his children, share responsibility for the children’s health and education expenses? Such were the questions addressed by the Appellate Division, Second Department, in its September 12, 2018 decision in Lozaldo v. Cristando.

Following the death of the children’s mother, the maternal aunt and uncle were awarded residential custody of the children and shared joint legal custody with the father. The aunt and uncle commenced this proceeding for child support from the father. After a hearing, Nassau County Family Court Support Magistrate Patricia Bannon entered a support order which, inter alia, required the father to pay 100% of the children’s unreimbursed medical and educational expenses, and to maintain a life insurance policy in the sum of $1,000,000, designating the children as irrevocable primary beneficiaries. The father objected to these provisions of the order of support. Family Court Judge Conrad D. Singer denied his objections. The father appealed.

The Second Department agreed with requiring the father to pay 100% of the children’s medical and educational expenses. There was no basis to find the maternal aunt and uncle liable for a portion of such expenses.

Continue Reading Family Court-Mandated Life Insurance | Non-Parent Liability for Health and Education Expenses

Tom Griffiths, psychologist, cognitive scientist and Princeton professor, concludes his TED talk, 3 ways to make better decisions — by thinking like a computer, with the following lesson:

“You can’t control outcomes, just processes; and as long as you’ve used the best process, you’ve done the best that you can.”

Dr. Griffiths has researched the connections between natural and artificial intelligence to discover how people solve the challenging problems they encounter in everyday life. His 2016 book authored with Brian Christian, Algorithms to Live By, illustrates how the algorithms used by computers can inform human decision-making (and vice versa). The book was named one of the Amazon.com “Best Science Books of 2016” and appeared on Forbes’s “Must-read brain books of 2016” list as well as the MIT Technology Review’s “Best books of 2016” list.

In New York, most couples going through a divorce, although aware of litigation and mediation, do not know that they have a choice of a third structured process to unravel the marital relationship and transition the family through the divorce. Most divorcing couples don’t know that they have a chance to apply Griffiths’ lesson and select a process that can reduce the time, cost, anguish and damage that so often accompanies divorce litigation, yet address the shortcomings of mediation.

Continue Reading Divorcing Couples Can Learn a Lesson From Computer Algorithms