What is a “mandatory” college expense to be shared by the parents?

In its January 15, 2014 decision in Shaughnessy v. Cox, the Second Department upheld the order of Nassau County Family Court Judge Robin M. Kent (which in turn upheld the determination of Support Magistrate Neil Miller) directing the father to pay 50% of the college expenses of the parties’ children regardless of their emancipation. The parties’ stipulation of settlement of their divorce action so provided. Moreover, the father’s obligation included the repayment of expenses which were paid from the proceeds of student loans.

However, Magistrate Miller had required the father to pay those expenses “upon the mother’s presentation of proper documentation directly to him . . . .” This, the Second Department held was error. Rather, the documentation should be provided by the mother first to the Family Court. The Court would determine whether the expenses were mandatory and, therefore, payable by the father pursuant to the parties’ agreement.

Setting up a situation in which parties are required to go, in the first instance, to a court to determine whether a college expense is “mandatory,” seems like extra work is being created. Here, it is not explained why the mother did not present proper documentation of expenses prior to Magistrate Miller making his ruling. Alternatively, the appellate court could have set up a procedure by which only if the father disputed the mandatory nature of expenses claimed by the mother would further Family Court proceedings be necessary.

Once again, the controversy results from the failure of an agreement to properly set forth the categories of college expenses to be shared. Apparently this agreement only specified “mandatory” expenses.

Years in advance, it is all but impossible to specify every type of expense which the parties contemplate they must share. Certainly tuition is covered. Are room and board expenses covered if the student lives off-campus, or are they capped at an on-campus rate? Are fees included? What about books? What about a computer? Applications? Spending money? Clothing? While the parties and their counsel may not have the ability to see long into the future to determine what the children will be paying for at college, the effort to do so is worthwhile. The time and energy necessary to have a court resolve the question as to what is “mandatory” may well be greater than the expenses involved.

Trying to articulate the standard to be used years later to determine whether parents will be required to pay college expenses and the parents’ respective shares may be close to impossible.

In Curley v. Lausen, an October 17, 2013 decision of the Third Department, the appellate court had the opportunity to consider different descriptions of such a standard as discussed at various points during the dictation of an oral stipulation into the court record. That stipulation provided that the parents would pay for a college education for their children based upon their then existing respective incomes. However, “in a later clarification during the stipulation,” the father’s counsel specified that “both parties are going to contribute to the college expenses as their incomes allow.” The mother’s counsel then further clarified that such would be “based upon the then existing financial ability to pay.” As the appellate court noted, “unfortunately, these so-called clarifications created confusion, because “existing respective incomes” does not necessarily mean the same thing as “as their incomes allow” or “existing financial ability to pay.”

In this case, the appellate court resolved the ambiguity by requiring the parties to pay college expenses “based on their financial ability to pay.” This was the last clarification placed on the record during the stipulation, “and the two clarifications evince the parties’ intentions to contribute based on their ability to pay, which takes into account more than just gross income.”

The appellate court then, however, ordered the father to pay for 81.5% of the college expenses, and the mother to pay the remaining 18.5%, only by referencing their “incomes.” The mother’s income was imputed to be $25,000 as if she were working full-time year-round. She actually earned only $15,000 full-time in January through April and two days per week for the remainder of the year as a tax preparer. Noting that the mother had a Bachelor’s degree in accounting and could work full time, the appellate court felt justified in extrapolating a full-time year-round salary. The father’s income was based upon his testimony in another, but related hearing that his income was in the “ballpark” of $110,000. Apparently, no other proof of current income was in the record. The father wanted to rely on the $68,112 he earned used to determine the original 2002 support order.

However, realistically, does the mother, imputed to earn $25,000 per year, have the “ability” to pay 18.5% of the child’s college expenses? Does “ability” and pro rata share of combined imputed parental income mean the same thing?

Should not the test for “ability” be similar to that for “means” as analyzed by Monroe County Supreme Court Justice Richard Dollinger in his June 22, 2012 decision in L.L. v. R.L., discussed along with other college expense decisions in my October 15 and October 22, 2012 blog posts?

The inability of lawyers, and their clients, to predict the future will continue to cause problems such as these. All the more reason to question settlement agreement drafts as a three-year old would do: why? why? why? what if? what if? what if?