Opinion
05/6146
02-25-2019
Gloria M. BORRELLI, Plaintiff, v. James G. BORRELLI, Defendant.
Steven M. Witkowicz, Esq., Rochester, New York, Attorney for Plaintiff Maureen Pineau, Esq., Rochester, New York, Attorney for Defendant
Steven M. Witkowicz, Esq., Rochester, New York, Attorney for Plaintiff
Maureen Pineau, Esq., Rochester, New York, Attorney for Defendant
Richard A. Dollinger, J.
College expenses, often shunted aside or vaguely articulated in the heat of divorce negotiations when children are young, are the matrimonial equivalent of the clock-swallowing Tick-Tock, the imaginary crocodile that haunts Captain Hook in Peter Pan : the costs lurk quietly but distinctly ticking just off the family ledger book until the child graduates from high school and then the costs surface - beyond anyone's expectations - and bite both unsuspecting parents in the pocketbook.
In this case, a couple, divorced for more than a decade, now quarrels over financing the cost of their child's college education. The quibbling results from a vague separation agreement in which the parents bunted the issue of financing college education to a later day.
This Court has repeatedly considered applications by parents to enforce college obligations. See Bocka v. Bocka , 48 NYS3d 264 (Sup.Ct. Monroe County 2016) ; Luken v. Luken , 48 Misc 3d 559 (Sup.Ct. Monroe County, 2015) ; S.B. v. J.R. , 43 Misc 3d 171 (Sup. Ct. Monroe County 2013) ; L.L. v. R.L. , 36 Misc 3d 777 (Sup.Ct. Monroe County 2012).
The party's separation agreement relating to college expenses contains five pertinent parts. First, the couple acknowledged that they "anticipated" that their children would pursue a college education. Second, they defined what "higher education expenses" would include and added what is colloquially referred to as a "SUNY cap" on those expenses. Mons Pinto v. Pinto , 151 AD3d 715 (2d Dept 2017) ; Pamela T. v. Marc B. , 33 Misc 3d 1001 (Sup.Ct. New York Cty 2011) ("SUNY cap is a concept that has been judicially created by way of a string of decisions rendered since the enactment of the statute" and it limits a parental contribution of the cost of college to the costs at the State University of New York). There is no dispute about the either of these first two clauses.
This Court authored an article on the many dimensions of the supposed "SUNY Cap" and its treatment in the New York courts. Dollinger, A Sweet 16 Primer on the "SUNY Cap" Family Law Review, New York State Bar Association, Family Law Section, Spring 2014, Vo. 46, No. 1.
The dispute involves the sentences that follow the description of the "higher education expenses." The next sentence reads: "each parent shall pay for the children's college expenses as they are able at that time." In the next sentence, the couple mentioned two other factors: first, the "parents would be consulted, in advance, concerning the college education and the choice of colleges for the children." The paragraph ends with the words "each shall be encouraged to participate in the planning of said education." The agreement, just below the section dealing with college costs, contains other language that impacts the matter before this court, even though neither party focused on it during the hearing or post-hearing submissions. In a Section entitled "Periodic Adjustments," the parents were required to exchange "complete income information" including W-2 statements and all "schedules," which presumably means schedules attached to their individual income tax returns. The exchange was required by February 15 of each year. There is no evidence, in this record, that either parent made that disclosure in any year. In addition, neither parent has asked this court to enforce that requirement.
But, the agreement goes a step further: it indicates that if either parent "elects to retire" or forego "full-time employment," then "the prior full-time wage shall be used to calculate the ongoing child support obligation" and the agreement adds that "neither parent can voluntarily reduce his/her income and reallocate the burden of supporting the children to the other parent."
The "periodic adjustment" language is relevant to the dispute before this court. The language is included in Article III of the agreement, under the heading "Child Support," which is evidence that the parents agreed that colleges costs were a subset of child support. Under this language, the parties clearly intended that they would annually recalculate their "child support obligation," which includes the cost of college education. This conclusion is further fortified because the agreement states that the obligation to contribute - from either parent - is to be calculated "at that time." Given the combination of the "at that time" language and the annual adjustment requirement, this court concludes that a parent's contribution to college was an independent obligation in each year that the daughter went to college. Thus, to determine a parental contribution on any given year requires a disclosure of each parent's income each year the child was in college. The parents intended that no single percentage would dictate a contribution for the entire four years. Instead each year an income comparison would dictate the parent's contribution for the coming school year. Therefore, while both parents paint a broad stroke picture of the legal arguments in this case in their submissions, the court must focus on what evidence of income existed for the parents in each year 2015, 2016, 2017 and 2018, which would dictate the contributions for the intervening school years of 2015-2106, 2016-2017, 2017-2018 and 2018-2019.
In the proof of this matter, the child graduated from high school in 2015. The mother testified that she engaged the father in a series of conversations in 2015 regarding their daughter's desire to enter college. The child, the mother testified, was an "exceptional student" and the mother conferred with the father "a lot" during this time in 2015, when she applied to colleges. When the child began considering colleges, the mother testified that she discussed her daughter's choices with the father. She offered to have the father take the child on college trips, but she testified that father refused because, she said he told her, "he did not have time." In an email exchange in February 2015, the mother asked the father for information to complete a federal financial aid form. The father replied that he was unable to contribute to the cost of college because "my bills exceed my income" and added that "I'm paying the IRS and arrears in child support for I have no extra money." There is no evidence that the father, at that time, produced any documents to the mother or the child that substantiated his refusal to contribute to the child's college costs. There is no evidence that he produced the documents required by the "Periodic Adjustment" clause in their agreement, but as noted earlier, there is no evidence that the mother demanded production of those documents in 2015. The mother also testified that she contacted the father in 2015, asked for his financial information, but she testified that he simply responded "No, I am not going to do it." When the child was accepted to a college to which she eventually matriculated, the mother told the father about that choice and, in her words, the father did not have much of a response and simply said "just do what you want."
Importantly, while this couple discussed the cost of college in 2015 - just after the daughter graduated from high school and before matriculating in college - there is no evidence that they discussed the college costs at any other time, even though their daughter appears to have attended college in the years from 2015 through 2019. In short, while there is disputed proof about the communication between the mother and father over college costs in 2015, there is no evidence that either parent brought up the subject again - or sought documentation of their respective incomes - until the mother applied for reimbursement and contribution to the college costs in the current application, filed in the spring of 2018.
In cross-examination, the mother admitted that when she contacted the father in the spring of 2015 and asked for financial information, the father responded that his bills exceeded his income and he told her that "he was unable to contribute." Importantly, even though she was not asked, there is nonetheless no evidence that she ever asked the father to document his inability to pay or provide any documentation of his financial distress.
After the mother testified, the father's counsel moved to dismiss the mother's application, claiming, among other arguments, that the child would have qualified for an "Excelsior Scholarship" under New York's recent initiative to help middle-income families finance college expenses. Counsel argued that the child's securing this scholarship would have drastically - if not entirely - eliminated the child's college education costs. While this court has a laymen's knowledge of this program and would, as requested by the father's counsel, take judicial notice of the existence of the program, the court declined to take judicial notice of the fact that the daughter would have qualified and received such a scholarship. Furthermore, if the "consultation" or "participation" clauses in this agreement have any meaning at all, it is obvious that a father, who denies funds to contribute to college, should have suggested prior to his daughter's selection of any college, that his daughter and the mother explore the Excelsior Scholarship. There is no evidence he ever discussed this option with his child or the mother before they selected a college and his efforts to raise this objection to the daughter's costs at the time of trial, well after the costs have been incurred, is unavailing. The Court denied the motion to dismiss.
For guidance on the Scholarship Program, see https://www.suny.edu/smarttrack/types-of-financial-aid/scholarships/excelsior/
Under direct examination, the father testified that he was contacted by the mother about college applications, but he reiterated that he told her that he could not "afford to contribute to Fordham." He further testified that he was never told about his daughter's acceptance until after it happened, and he testified that when she told him of her acceptance, he told her that he could not pay for it. In his abbreviated testimony, he never said that he talked to the mother about financing the Fordham education. On cross-examination, the father admitted that his 2015 tax return showed $ 98,885 in wages. The father also testified that he had a conversation with his daughter, before she went to Fordham, in which he told her that he could not contribute because he did not have the funds.
In resolving this dispute, the first hurdle for the mother is to determine the extent of her obligations, if any, under the "consultation" language in the agreement. In reading this agreement, this court is unconvinced that the reference to "consultation" in this agreement is a condition precedent to the father's obligation to assist, as best he can, with financing college education. The agreement references that the "parents" shall be "consulted" about college choices. The agreement does not specifically create an obligation on either parent to initiate the consultation. The agreement does not create a duty on behalf of the mother to consult or specify any penalty or other repercussions if the mother fails to initiate the consultation. The agreement, read in this fashion, simply assumes that the parents would discuss college choices, but it nowhere delegates that responsibility specifically to the mother.
In addition, the evidence in this matter establishes that even if the mother was the parent who had a specific obligation to consult, the mother did consult with the father. It is undisputed that the father was told by the mother that the child was considering colleges. It is also undisputed that the mother discussed the federal financial forms with the father. What is also undisputed is that the father upon hearing of his daughter's college choices, did nothing other than say he could not afford the cost. He never offered an alternative. As noted earlier, he never suggested applying for the "Excelsior Scholarship," even though that may have been the responsible choice for this middle-income family. He also never mentioned a SUNY school, even though he had bargained for a SUNY-cap in the agreement, a move that would have been clearly within his contractual prerogatives.
This court credits the mother's testimony that the father's initial response constituted a waiver whatever contractual right he had to consultation: he simply said, "do what you want." The father also never spelled out to the mother — or his daughter — the extent of his financial difficulties. The mere mention of taxes and bills, without offering any further proof of income or income tax returns, makes it easy for this court to conclude that the father waived his right to further consultation. In this court's view, the whole point of these words in this sentence was to require both parents to actively participate in their child's choice of college. The couple agreed to insert the words "in advance" into the agreement, which signals that each parent wanted the option to "consult" about which college would be most appropriate — and financially most feasible — before their daughter was accepted. The father got notice that costly colleges were on the horizon, but there is no evidence that he took any actions to inhibit his daughter's selection or advocated less-expensive options. He knew that his contribution was limited to the cost of a SUNY education and he could have, at any time, insisted on applications to and acceptance by a SUNY school. Instead of exercising his full right to consultation, before a final decision was made, he uttered the words "can't afford it" and stuck his head in the sand. He cannot now resurface and claim a right to void the child's choice of a college program or refuse to pay his share of the costs.
This court also declines to read the final wording of this sentence as creating a legal binding obligation on the mother. The language reads that "each parent shall be encouraged to participate in the planning of said education." The father knew that his daughter was headed for college and he had the contractual right to "participate in the planning." But, while he had that right, he never exercised it. He never asked for a meeting with the mother and child to review the college selection or its costs. He never advocated SUNY schools or less costly alternatives. In addition, this language does not create a binding obligation on the mother to facilitate the father's "participation" in the planning. She had no specific obligation to initiate his "participation" in the planning - he had the same right or obligation under the agreement - and there are no contractual consequences for her failure to initiate it.
In short, this court declines to read the "consultation" and "participation" clauses as creating enforceable contractual rights because the language in the agreement fails to assign a specific duty to a specific parent to initiate the consultation, fails to set forth a time in which the "consultation" must occur, does not describe what the parents must produce as evidence of their ability to pay - or not pay - and never details a penalty to a parent who fails to initiate consultation or participate as the agreement states. The precatory language in this agreement is purely aspirational and a statement of a then-present intention: it creates no binding contractual obligation on behalf of either parent.
When all these unenforceable contractual arguments are swept away, there remains one enforceable obligation: the parents did agree to contribute, as they are able, up to the SUNY cap. But, at this point, the mother's application fails for at least the first three years of the daughter's college because there is no evidence before the court of both parents' income in 2014, 2015 and 2016, when the annual pro rata calculations for the daughter's college costs were required. First, there is no evidence of the father's 2014 income which would have been the basis for calculation of his contribution to 2015-2016 school year. There is also no evidence of the mother's income in 2014, which would define her contributions to the 2015-2016 school year. Therefore, this court is without any basis to calculate the father's contribution to the 2015-2016 school year. There is some evidence of the mother's income in 2015 because she attached a 2015 income tax return to her federal financial aid forms. However, the income is inconclusive and the Court declines to credit it. In the absence of evidence of the mother's income in 2015 or 2016, there is no basis for this court to make the required calculation of her percentage share of the college costs for school years 2016-2017 and 2017-2018.
The tax returns would involve the year before the daughter attended college. The parties would under the agreement, disclose and review their respective 2014 incomes (as reflected in the exchanged W-2s and tax returns) to determine their pro rata shares for the 2015-2016 school year. The 2015 income would define their contributions in 2016-2017 and the 2016 income to dictate their 2017-2018 contributions. The 2017 income information would dictate the contributions for the daughter's final school year, 2018-2019.
The mother's 2015 income tax return shows a $ 45,518 net loss carryover and a negative $ 39,030 in income. This loss carryover and the loss in income was never explained at the hearing and given the absence of any explanation, the Court declines to use it as a basis for the pro rata calculation of college costs in 2015-2016.
Under the proof before the Court, the first demonstrable evidence of the father's income is introduced through the father's 2016 income tax return which showed total earnings of approximately $ 98,885 and a $ 17,260 pension or annuity distribution, leaving a total income of $ 116,282. While this income could easily justify the conclusion that the father had the "ability to pay" some - if not a significant portion - of the daughter's cost for 2017-2018 school year, the lack of evidence of the mother's income at that time precludes the calculation and the mother's claims for contribution to the 2017-2018 college costs must be denied.
This Court has previously held that a parent is under no obligation to withdraw any sums from his retirement accounts to finance a child's college education. L.L. v. R.L. , 36 Misc 3d 777 (Sup.Ct. Monroe Cty. 2012). But, if a parent elects to make such withdrawals and the withdrawals are part of his last income report before the Court, then this Court can consider that additional amount in evaluating his ability to pay.
The only year in which the mother produced evidence of her income was 2017 which, under the agreement, would be the basis for calculating her pro rata contribution to the 2018-2019 school costs. The mother testified that she operated two businesses, but her 2017 adjusted gross income was only $ 4,141. To make ends meet, the mother testified that she borrowed from retirement savings, borrowed substantial sums from a home equity line of credit for her house and borrowed from her relatives. When asked whether the father had contributed anything to the child's college costs at any time, the mother said no. As proof of her financial circumstances and her "ability" to pay these expenses, the mother introduced her 2017 income tax return and her statement of net worth. Her income tax return is inconclusive: it shows less than $ 5,000 in income, a fact perhaps attributable to her starting a new business and other factors. However, her net worth statement shows monthly expenses of $ 3,955 or more than $ 47,000 annually which, according to the statement of net worth, does not include income taxes, a fact that would push her gross pre-tax income over $ 55,000 annually. The mother's statement of net worth shows substantial debt and she claims, without documentary evidence, that the debt relates to the college expenses for which she seeks reimbursement or payment. While this court may be sympathetic to the mother's financial circumstances, the agreement still mandates that her only enforceable obligation under the agreement is that she and the father — combined - should pay college expenses up to the SUNY cap cost. How much she elected to pay beyond her share of the SUNY cap is a voluntary contribution in each of the years in which her daughter attended college and she has no right to seek payment from the father for any amount over his annual percentage share of the SUNY cap. Therefore, unlike the prior years, the mother produced evidence of her 2017 income from which this court can calculate her percentage share of the college contribution for 2018-2019 school year.
Importantly, the mother's counsel argues in his post-hearing submission that the mother's 2017 income should somehow define her percentage contributions for each year throughout the daughter's college career. This approach — using one year's minimal income in any given year to define the mother's pro rata contribution throughout the four years of college - is inconsistent with the agreement, which mandates an annual recalculation and redistribution of the college costs, depending on the parent's then-annual income.
In evaluating the father's share of the SUNY-cap expenses for the 2018-2019 year, this court's find sufficient proof to establish the father's income for purposes of calculating his contribution. Based on income tax returns for 2015 and 2016, the father had income - "the ability" - to pay college expenses, as his income crested over $ 100,000 annually in 2015 and 2016. He produced his 2015 individual tax return, which proved income in excess of $ 100,000. In 2016, he filed a joint income tax return with his spouse, but the attached reports of income demonstrate that he had personal income of approximately $ 110,000 including his earned income and a pension distribution. He produced no income information for 2017, the year in which the application to enforce the separation agreement was brought, but he did testify, in response to cross-examination, he testified that his 2017 income was "half" of his income in 2016. This court, in seeking to define his contribution for the 2017-2018 school year, accepts his admission and concludes that his income for 2017 was $ 55,000 or "half" of the income reported in 2016.
Therefore, the Court, in seeking to arrive at a pro rata contribution, imputes income to the mother, consistent with her annual expenses and accepts the father's declaration of his annual income. The result is that the father's income - by admission - is approximately $ 55,000 and the mother's income, based on her expenses as reported on her statement of net worth, is approximately $ 55,000. Their 2017 incomes are almost identical. Based on these findings, the father and mother must split the college costs for 2018-2019 in equal shares.
While that determination sets the respective abilities of the parties to pay for the 2018-2019 school year, as their agreement requires, other issues remain. The first is the cost of the SUNY cap in the 2018-2019 school year. Although the agreement does not specify which SUNY campus should be used as the basis for the calculation of the SUNY cap, the court takes judicial notice of the campus room board and other expenses for the SUNY Buffalo for 2017-18 which total $ 16,446. The court also takes judicial notice of the same fees for 2017-2018 at SUNY Brockport, which total $ 15,229. These costs for two SUNY campuses within easy driving distance of the homes of either the mother or the father, when averaged, total $ 15,418 annually. Under this fee scenario, the pro rata fees to be paid by each parent would be $ 7,918. However, both of those amounts would be reduced by any scholarships secured by the daughter. In addition, the father, if paying child support for the daughter to the mother would be eligible for a Rohrs credit for any payments of room and board expenses. Rohrs v. Rohrs , 297 AD2d 317 (2d Dept 2002) ; Juhasz v. Juhasz , 92 AD3d 1209 (4th Dept 2012) (a credit against child support for college expenses is not mandatory, but depends upon the facts and circumstances in the particular case, taking into account the needs of the custodial parent to maintain a household and provide certain necessaries); Wortman v. Wortman , 11 AD3d 604 (2d Dept 2004) (since the defendant is required to pay room and board, he was entitled to a credit against his child support obligation for any amounts he pays for college expenses which are duplicative of basic child support during those periods when the child may live away from home). Having demarcated these fees and each parent's responsibility, this court will require the parents and their counsel to evaluate the actual offsets and the father's entitlement to a Rohrs credit, if any, before issuing a final award in this matter.
https://www.collegetuitioncompare.com/edu/196130/suny-buffalo-state/tuition/
https://www.collegetuitioncompare.com/edu/196121/suny-college-at-brockport/tuition/
The final unresolved issue is whether this court can award college costs to the mother, consistent with the requirements of the agreement, for any time before she filed her application for a paternal contribution. The father's counsel argues that the mother is not entitled to reimbursement for any college expenses prior to her application to this court. However, that argument misconstrues the nature of the mother's application. She seeks to enforce the terms of the separation agreement and her argument is purely cast in terms of breach of contract. A separation agreement, incorporated, but not merged into a judgment of divorce, is an independent contract legally binding on the parties subject to the six-year statute of limitations applied to contract claims. CPLR 213 Merl v. Merl , 67 NY2d 359, 362 (1986) ; Allard v. Allard , 145 AD3d 1254, 1256 (3d Dept 2016). Therefore, she is entitled to have the father pay for any college costs, up to the SUNY cap as described above for the school years in which there was proof of both parent's income sufficient to support the court's calculation of each parent's respective shares of the cost. The only year in which the proof justifies the court's calculation is 2018-2019. To the extent that the mother, in financing her daughter's education, paid a portion of the father's SUNY-capped contribution for 2018-2019 in excess of her half-share, she is entitled to reimbursement from him.
The mother's application to enforce the agreement and require the father to contribute to the daughter's college costs is granted to the extent of requiring the father to pay the sum of $ 7,918 in college costs for school year 2018-2019, minus any applicable Rohrs credit for room and board costs, if appropriate, and minus any scholarships or other offsets against these expenses. The father's application to dismiss any claims for school years 2015 through the end of the spring semester in 2018 is granted and those claims are dismissed.