Practice Tip:
College Tuition Clauses in Divorce Settlement Agreements
By Jennifer H. Keaton

On May 11, 2015, the Supreme Court of Georgia issued a decision regarding the interpretation of a divorce settlement agreement’s clause that required, paraphrasing here, the Father to pay for college tuition for his daughter “for so long as the child - attends school full time.”  What prompted the dispute was Father’s refusal to reimburse Mother for her payments of multiple semesters of college tuition.  His argument: the daughter attended college only part time.

Here’s the short story:  Daughter attended Valdosta State University, receiving the Hope Scholarship and Pell grants.  In other words and completely non-judgmentally, Daughter’s financial aid provided a low tuition obligation to Father, who hired two attorneys to represent him in this case.  At VSU, Daughter’s accrual of credit hours each semester was splotchy, sometimes between 9 and 11 credit hours rather than a full, 12-credit-hour load.  However, Daughter did register for some summer courses.

Justifying his refusal to pay Daughter’s tuition, Father argued that the semesters that Daughter took less than 12 credit hours in a semester: (1) did not constitute attending “school full time”; and (2) thus relieved him of any further obligations to pay for Daughter’s college tuition.  It was legally irrelevant why Daughter’s credit hours were occasionally low; the divorce settlement agreement did not explicitly allow for consideration of the reasons why Daughter may have failed to carry a full load, though it stipulated that she had to earn passing grades (a small mercy to the pride and privacy of Daughter).

The Supreme Court, articulating legal precedent as simply as it could, concluded that the Father’s interpretation of the Decree was unreasonable.  So, despite hiring two attorneys, Father had to reimburse Mom for tuition payments.  (The author speculates that any cash payment was made in metal legal tender placed inside Karo Syrup bottles.  Probably Karo Dark. –ed.)

But, there is a lesson here for divorce mediators:  clarify, clarify, clarify what parties mean!  Your diligence can make for clearer agreements and less work for the Georgia Supreme Court.  (The author further speculates that Father was retroactively interpreting this particular settlement clause to his personal convenience and that the drafting was actually just fine.  But, the moral of the story stands.)  Here’s the clause that resulted in a family trip up Interstate 75 to the Supreme Court:

For so long as the child (child refers to all children of the parties) maintains passing grades and attends school full time, the Husband agrees to pay the cost of a college education (in an amount not to exceed the costs for tuition, books, student activities, fees, housing, food, etc. for a full-time, in-state student to obtain a four-year undergraduate degree at Valdosta State University or another accredited university upon which the parties agree.

Looks pretty good to me, but wait – this is a divorce case and necessarily requires more clarification as the parties are not communicating at their highest, best, and most reasonable levels.  And, unfortunately, defining “full time” attendance at college turned out to be a critical need in the divorce agreement for the Mims family in this case.

So, for us divorce mediators, some clarifying questions for your well-intentioned parties who dare to tackle college tuition for their adult children: who, what, when, where, and how are the keys.  In getting to these issues, it can keep the children out of the middle of avoidable disputes (email me for a copy of Mims, a case on point).

I also advise that divorce mediators ask if there are any circumstances when payment of these college expenses should stop or be suspended based on what the student does or does not do – the “what if” questions.  These questions often remind parents that the student’s future conduct might be problematic and that they do not want to lose the discretion to continue financially supporting adult children who may get off course.

So the basic questions are always:

1.     Who Pays?

2.     For what specifically? Clarify, clarify, clarify.

3.     When is payment made and to whom?

4.     How much?

5.     How is the amount calculated?

6.     How many times/payments?

7.     When does the obligation end (date) and/or when is it over (based on an event)?

8.     What are circumstances where payment will not be made or is inappropriate to be made?

9.     Would a reimbursement clause be appropriate?

10.    Can this payment provision be ended and/or amended through mutual agreement of the parties?  If so, when, where, how, and why?

These questions, of course, can be used for many items.  But, when it comes to the college, there is a lengthy set of events that lead up to graduation.  Indeed, any agreements to financially support adult children should detail who has decision-making authority to pay for certain college expenses, and should include some consideration of an “out” when the students’ use of the funds is poor or foolish.  Most parents aren’t looking to write a blank check for their adult children’s lavish tastes or questionable study habits.  (The author has heard stories of woe on this point.)  As mediators, we can reality test through simple but thorough questioning of the divorcing parents about what they mean and intend.

Below are some line items I regularly address with parties when they discuss college expenses.  These questions help to clarify, clarify, clarify (see above) so that the parents can avoid a Mims situation.

What about SAT and ACT preparation classes and fees for taking those tests?  How many classes or registration fees?
What about college application fees?  How many applications or what is the total budget?
What about deposits for matriculation into college and related living arrangements prior to the first day of school?
“College expenses” is a broad term – what is included?  Tuition, fees, room, board, books, parking passes, extracurricular expenses or dues?  Is there a cap on any of these categories?
Will you keep your student on a parent’s health insurance plan or car insurance policy? For how long?  Who pays the student’s portion of the premium?
Would a minimum contribution amount to a category make more sense than a percentage of an unknown total amount?  Language can be added that any additional contributions may be made at the sole discretion of each parent.
When does this obligation end?  (See National Lampoon’s “Van Wilder” – where the protagonist has attended college “full-time” for seven years without obtaining a four-year undergraduate degree.)
How does summer school fit into this obligation?
What “full time” mean for this agreement?  Is it the same as the school’s definition or something more practical?
Is this obligation impacted by any employment by the child?
Are there any events that would make both parents agree that supporting the child should end? (e.g., a drug arrest? a GPA of 2.0 or lower in any given semester?)

Are there any events that would cause both parents to agree that they should meet to evaluate whether supporting the child should end and, if agreed, whether it could resume in a different fashion? (e.g., medical issues of the student, including substance abuse, or other unforeseen issues such as accidents … and other accidents leading to grandchildren.)

Will you co-sign or guarantee a student loan with your student?
Will you agree to repay a part of your student’s personal loan if certain conditions are met? (Paying back rather than paying up.)
Will ownership of a family vehicle be transferred to the student’s individual name?
How will any 529 Account be utilized for this student?

Details this granular can be incredibly helpful to the parents’ ability to avoid a legal dispute akin to the Mims family’s public debacle.

From a pragmatic perspective, such details serve to fulfill the children’s needs for certainty and to decrease their anxiety that their questions about college could create conflict between the parents.  A bonus: the children will be better able to budget their time, money, and energy and to plan their college experiences and course loads.  Mediators add value when they ask hard, clarifying questions during mediation – particularly in divorce.


Jennifer H. Keaton, Esq., is an attorney and registered domestic relations mediator. She has been mediating since 2002, and she has mediated hundreds of divorces and modification cases.

Phone: 470-252-3305 E-mail: jkeaton@2StepDivorces.com

 

 
 
     

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