Divorce settlement conditions may be prudent

A recent divorce settlement dispute may be instructive for Wisconsin residents. A father of two emancipated children divorced, and the father’s relationship with the daughter had become strained. She had graduated from Rutgers University and been accepted at Cornell Law School. The father had agreed to a divorce settlement that required him to pay 50 percent of his daughter’s postgraduate education. The cost of Cornell was $74,580 per year for room and board, tuition, books and fees.

The father objected, arguing in court that he should not be obligated to pay citing personal financial difficulties, the availability of less expensive schools, his poor relationship with his daughter and his understanding that the mother had inherited money for the daughter’s education. The trial court disagreed, finding no language in the divorce settlement that supported the father’s argument. The New Jersey Appellate Court upheld the decision.

The courts generally consider a divorce settlement agreement to be contracts that have already been sanctioned by the divorce court. Unless significant changes in circumstances or issues about the legality of the contract itself can be proven, the courts will usually not rewrite or alter the terms of the contract. The settlement wording made no condition upon which the father would pay half the costs. The father was ordered to pay $112,500 as his portion of the Cornell education.

Divorce may become a complicated and emotional process. Arriving at an equitable settlement may be difficult, especially in cases of high-asset divorce or when complex assets such as stock options, business interests or investment vehicles are involved. An attorney experienced in settlement strategies, asset valuation, tax law and property division may help prevent any unexpected negative consequences of a broadly written settlement.

Source: The Huffington Post, “Divorce Settlements and Higher Education“, Brad Reid, March 13, 2014