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Retroactive College Contribution
Are there legal grounds to file a motion for retroactive college contribution?
This is a great issue that arises in most college contribution motions. In many college contribution cases they really turn into a massive civil litigation with "big bucks" on the line. Quite often the divorced father has moved on and gotten remarried. In many cases, the father "blows off" paying for the first few years of college for his kids who were born from his first marriage. The custodial parent then often gets fed up and then ultimately files a motion for current college contribution. Moreover, the wife often requests the payment for college contribution for the child's freshman, sophomore or junior year of college. Once you eventually get to court, then it is very common that $50,000 or more retroactive college expenses are "on the table." The stakes get very high indeed! I have had one college contribution case that went to a plenary hearing and approximately $70,000 in retroactive college tuition and related expenses were at issue. If the father lost his case, then he would have to reimburse the mother and the college $70,000.
As in the great majority of family law issues there is no definitive answer to this legal question. However, the recent reported case law indicates that the courts are now very conservative on awarding retroactive contribution. However, each case stands on its own merits. One twist in the facts could change the entire outcome. Moreover, as always there is a tremendous amount of randomness and subjectivity in the family court. You could file a motion to request college contribution before ten different judges, and receive 10 different court rulings. For better or for worse this is how college contributions motions are handled.
Could you please cite any recent case law that addresses the issue of retroactive college contribution?
A very recent case is the Appellate Division holding of Kmetz v. Fusaro, Decided October 9, 2009, Docket No. A-5870-07T3. Here, the defendant Richard Fusaro appealed the trial court's order that required him to contribute $58,703.73 toward the college costs of his daughter.
On appeal, the Appellate Division held that the trial court correctly required the defendant to make a further contribution to his daughter's education for the last semester of her junior year and for her entire senior year at college. Nonetheless, the Appellate Division opined that based on their analysis under Gac v. Gac, 186 N.J. 535 (2006), the defendant should not have been required to make any further contribution to his daughter's freshman, sophomore, and first semester junior years. The court held that the plaintiff-wife did not request the defendant to pay for those terms until those semesters had already ended. Finally, the Appellate Division held that based under the circumstances, it would be inequitable to require him to do so retroactively.
More specifically, the defendant and plaintiff were married on September 29, 1979. They had one child, a daughter who was born in 1986. They were divorced on March 3, 1995. Their property settlement agreement contains the following provision regarding funding for their daughter's college education:
The parties acknowledge their desire for the child to attend college or other post graduate professional schooling consistent with the child's ability and the parent's financial means. Each party agrees to assist the child in such endeavor and to contribute according to their then available means after resort to all available financial aid, scholarships and part-time and summer earnings.
After graduating from high school, the daughter then attended Marist College. The defendant voluntarily paid $1,500 each year toward her freshman and sophomore year college costs. In the summer between the sophomore and junior year, the plaintiff requested that defendant to increase his contribution because the daughter wanted to study abroad. Thus, the defendant increased his contribution to $2,000 that year. In the middle of the daughter's junior year, the plaintiff's attorney wrote the defendant a letter dated December 29, 2006, seeking additional contributions from him toward the daughter's college expenses.
When the parties could not reach a mutual agreement on the amount of the defendant's contributions, the plaintiff then filed a motion to compel for additional college payment. The plaintiff's motion requested to compel the defendant to contribute to the daughter's college expenses for prior years. The daughter's college expenses, after deducting scholarships, grants, and loans, totaled $96,255 for four years, broken down by year as follows: freshman year – $21,607; sophomore year – $23,981; junior year $27,026; and senior year $21,509. The defendant contributed a total of $7,500 toward these expenses. He also paid $200 a week, for a total of $10,400 annually, in child support.
According to the CIS's or the Case Information Statements filed by the parties, the defendant's annual income in 2006 was $127,048 and his net worth was $97,195, consisting primarily of his 401K; plaintiff's income in 2006 was $59,769 and her net worth was $51,948, also consisting primarily of her 401K. Both parties got remarried. In her motion, the plaintiff proposed that the parties divide the daughter's four year college expenses based on the ratio of their incomes. Under this proposal, the defendant would be responsible for sixty-eight percent of the college costs.
The defendant then filed a cross-motion in opposition. He requested that the court order that his obligation to contribute to the college expenses was completely satisfied. Furthermore, he advised the court that he had lost his longtime employment with Schering-Plough and that he was out of work.
The court did not have oral argument. Instead, the trial court entered an order dated June 20, 2008, that required the defendant to pay plaintiff $58,703.73 for retroactive college contribution. This sum represented his sixty-eight percent share of the college expenses, less the $7,500 he had already contributed. Furthermore, the defendant was required to pay the plaintiff $660 in counsel fees.
The defendant then appealed. His main legal argument was that the plaintiff's application was untimely and barred by the court's holding in Gac v. Gac, 186 N.J. 535 (2006). The defendant further contended that a plenary hearing was required in order to resolve two factual issues, namely whether he was consulted about his daughter's choice of college and whether the plaintiff advised him that his contributions were insufficient.
In applying the Newburgh factors, the trial court found that:
The trial court thus concluded that all of the Newburgh factors favored defendant's contribution to the daughter's college education costs.
On appeal, the Appellate Division noted that the defendant has throughout the years made some contributions to his daughter's college education costs. However, the court noted that the critical issue in this appeal was the amount of that contribution. The court stressed that when evaluating the trial court's ruling on that issue, we must look to all of the Newburgh factors, including the father's ability to pay, as well as the timeliness of the mother's application for contribution. The Appellate Division emphasized held that a custodial parent or child should not wait until the college expenses are incurred and then seek reimbursement from the custodial parent. Gac v. Gac, supra, 186 N.J. at 546-47.
The Appellate Division further held that a parent or child seeking contribution towards the expenses of higher education should make the request before the education expenses are incurred. The court noted that as soon as practical, the parent or child should communicate with the other parent concerning the many issues inherent in selecting a college. At a minimum, a parent or child seeking contribution should initiate the application to the court before the expenses are incurred. The court stressed, that the failure to do so will weigh heavily against the grant of a future application.
In summary, the Appellate Division held that the plaintiff's delay in seeking contribution, that resulted in the accumulation of $58,703.73 in college expenses was not reasonable. The court noted that this amount, was particularly harmful because the costs are high in proportion to defendant's income and assets, and because he has lost his long-standing employment.
Based on these circumstances, the court concluded that under a fair balancing of the Newburgh factors in light of Gac, the defendant should not have to pay additional amounts for college expenses that were incurred before plaintiff made her demand in her attorney's letter of December 29, 2006. Thus, the father did not have to pay for retroactive college contribution. Nonetheless, the court did require him to make payments for his proportionate share for those college expenses incurred after that time. Thus, the father was ordered to pay his proportionate share (sixty-eight percent) of the costs for the second semester of his daughter's junior year, and for her entire senior year at Marist College.
What other legal case(s) are "on point" on the issue of retroactive college contribution?
Another interesting case is Keegan v. Keegan, A-9-98T1. Here, the father had a legal obligation to pay for retroactive college contribution. The parties were divorced in 1994. In April 1998, Mr. Keegan filed a notice of motion for emancipation and modification of alimony and child support. More specifically, Mr. Keegan requested to: (1) emancipate their oldest daughter (Jennifer) who graduated from college in May 1998; (2) to emancipate their second daughter (Lea) who ended her full-time college status and began working on a full-time basis; and (3) to modify his child support obligation for their youngest daughter (Michele) who was in college at the time.
In response, Ms. Keegan filed a cross-motion to request: (1) to collect arrears for Jennifer's college expenses; (2) for retroactive contribution for Lea's college expenses and denial of her emancipation; and (3) for contribution for college expenses associated with Michele.
On June 3, 1998, after conducting a hearing on cross-motions, the trial court issued an order that: (1) emancipated Jennifer, retroactive to May 29, 1998; (2) denied emancipation for Lea; (3) modified and reduced child support retroactive to May 29, 1998; (4) ordered Mr. Keegan to pay college expenses of $2,050.00 for Jennifer, $1,291.67 for Lea, and $7,279.58 for Michele; and (5) ordered Mr. Keegan to pay fifty-eight percent and Ms. Keegan to pay forty-two percent of any remaining college expenses for the two daughters not yet emancipated. Thereafter, Mr. Keegan filed a motion for reconsideration. The trial court denied Mr. Keegan's motion for reconsideration.
Mr. Keegan then filed an appeal from the trial court's order denying his motion to emancipate his daughter Lea, and for ordering him to reimburse Ms. Keegan for college expenses incurred for Lea and Michele. On appeal he raised the following points:
The Appellate Court denied the appeal and it upheld the trial court's decision. Thus, Mr. Keegan was still legally required to contribute and to pay for the children's prior years of college tuition and expenses. In short, Mr. Keegan was required to pay for retroactive college contribution for his children.
In summary, a review of the Kmetz and Keegan cases clearly prove my point that there is not enough uniformity in New Jersey family court case law. This lack of uniformity ultimately creates a massive amount of litigation that most New Jersey people simply can't afford to pay for. I really don't see any foreseeable solutions to this problem. In fact in my professional opinion the area of college contribution is just simply getting more esoteric and theoretical in nature. The bottom line is that the parents should try to save their money from litigating with other, and use these funds to pay for the children's college. If this is not possible, then I strongly believe that the family courts should try to create some type of process to handle college contribution motions that are as not as time consuming and expensive as they are currently. Plenary hearings routinely cost between $5,000 to $10,000 in legal fees. The current reality is that litigating college contribution motions is in many instances as complex and expensive as the parties' original divorce case was. I strongly believe that the area of law on college contribution should be reformed to create a more streamlined and cost effective legal process. In many college contribution cases the litigation can take almost two years or more to complete. In closing, keep these points in mind if you "get caught up" in a Newburgh/Arrigo hearing.
New Jersey is an equitable distribution state, meaning that the division of property in a divorce is to be done fairly, not necessarily equally. The court can take into consideration any factor it deems relevant when dividing property, but it must consider certain factors, such as how long the couple was married and the age and health of both spouses, the income or property brought to the marriage by each spouse, the standard of living that was achieved during the marriage, and the extent to which one spouse may have deferred career goals, among others.
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