Sunday, April 12, 2015

Nothin’ Funny ‘Bout College Tuition

Dyke v. Scopetti, 2015 VT 53

By Amy Davis

This case involves a separation agreement wherein Dad agreed to pay for the kids’ college tuition. Because THAT’S a good idea. Wasn’t there an entire movie made about how that’s a bad promise to make? Get the kids a nice rescue dog, instead. Jeez.

Mr. and Mrs. Scopetti separated back in 1998 in Pennsylvania. Their two-page, hand-written separation agreement stipulated that Dad would pay for their two daughters’ college tuition at “an institution acceptable to Frank Scopetti.” This probably seemed like a good idea back in 1998 but nobody would agree to that now. Not if you ever saw my student loan statements, all nicely organized in a shoebox marked “Do Not Open.”

Pennsylvania granted the divorce decree in 2000. Mom moved to Vermont and Dad moved to Arizona. In 2010, Mom registered the support order in Vermont, and that fall, Indie (the eldest daughter) started school at George Mason University (GMU) in Virginia. For the 2010-11 school year, Dad only paid a portion of the tuition.

In August 2011, Mom filed a petition to enforce that clause of the separation agreement. Dad said it wasn’t enforceable because the agreement was illusory, unenforceable, he never approved the choice of institution, and $10,000 is enough anyway. I can’t send my dog to college for $10,000.

In December 2012, the magistrate judge granted Mom’s motion to enforce, concluding that noncompliance with the consultation condition did not eliminate the obligation completely, but Dad has to assume some reasonable portion of expenses. What’s reasonable? Oh, it depends.

So in April 2013, the magistrate held an entirely separate hearing to determine what “reasonable” meant for Dad. The magistrate found as follows: the kids did well in high school, Indie chose nursing as a career and wanted advanced degrees, and she chose GMU because it was near a city and had a great nursing program. Had Indie gone to the University of Vermont, then the in-state student rate would have been $12,888 in 2011-12. But, she didn’t apply there. At GMU, the tuition was $25,440 for 2010-11 with the total cost of attendance being $38,233. Indie got some scholarships, grants, and workstudy totaling $14,350, Dad pitched in $13,500, and Indie took out loans for the rest (about $10,000). For 2011-12, tuition and costs went up, Dad paid $15,201 towards tuition and Indie took out loans for about $8,000.

In the fall 2012, Indie transferred to the University of Maryland Baltimore School of Nursing (UMSON) without Dad’s approval. But Indie believed the nursing program was better. The tuition was about the same, but the actual costs were significantly higher because Indie gave up her scholarships and grants. She got a small grant, Dad paid $5,000, and Indie took out $36,500 in loans.

So in the fall 2011, Francesa (the younger daughter) enrolled in a 4-year dental-hygiene program at the University of New England (UNE). Special shout-out to my alma materif anyone from UNE is reading this and wants to forgive some of my debt, feel free. Vermont did not offer a baccalaureate dental-hygiene program and Francesa did not like Arizona. So, for Francesa’s first two years, the tuition bill came to $60,180. She got scholarships and grants of $46,400, Dad pitched in $18,845.27, and she took out loans to cover the rest.

Now, this is the point where if you still felt sorry for Dad, feel sorry no more. Mom worked two jobs, went to school at night, and had a modest income. Dad, had a couple of degrees, his own business, and earned about $200,000 a year. He also spent about $1,500 a month in veterinary and horse expenses and $1,400 a month in golf fees.

Dad figured he was only obligated to pay $10,000 a yearan amount that wouldn’t even cover half of UVM’s tuition. The magistrate said $10,000 was unreasonable and added, “Mr. Scopetti can withstand a loss of $40,000 in a horse breeding business. He chooses to pay more in veterinary bills than he pays for either of his daughter’s educations.” In conclusion, Dad would need to pay the tuition at the children’s chosen colleges after all scholarships and grants were applied to the tuition, fees, room and board, but any other cost of attendance was up to the kids to cover. The one exception was the year Indie transferred to UMSON losing her scholarships and grants. But for the next year, Dad had to pay.

Dad appealed on the basis of no contract because there was no “meeting of the minds,” that whole paragraph was jiggery pokery anyway, that the judge didn’t apply Pennsylvania law, and that the reasonable analysis was unreasonable. Superior court affirmed, applying PA law. The court found that the contract was valid, Dad had an enforceable duty, and that Dad’s idea of what was acceptable was unreasonable. Dad appealed to the SCOV using the same arguments. Reviewing the child-support order de novo, the SCOV affirms.

Dad argues the settlement agreement requires consultation and approval, and that the magistrate improperly applied a “reasonableness” requirement. He’s wrong. In PA, they use contract law in martial settlement agreements to figure out the parties’ intent. PA case law shows a reluctance to infer any sort of consultation requirement. Sure Dad has to OK the college (something we’ll deal with later), but advance consultation is not mandatory. And, PA courts enforce agreements if that agreement conditions the obligor’s obligation to pay upon consent with the child’s choice of college IF the obligor expressly agreed not to unreasonably withhold such consent. What does that mean? All of that “acceptable to Dad” language created an implied condition that Dad could not unreasonably withhold acceptance. Therefore, “under Pennsylvania law, the condition that father is only required to pay for his daughters’ tuition if they attend institutions acceptable to him is enforceable, but only insofar as father exercises that discretion reasonably.”

So what about all of those indefinite terms and illusory promises? There’s an implied condition that Dad exercises his right to accept or reject the college choices in a reasonable way. Lucky for us, that resolves his two other arguments. Killing birdies with stones, here. We all know that indefiniteness of terms does not necessarily render a contract void. Likewise, a promise is illusory only when the promisor commits himself to nothing, so that the promise is entirely optional. Not the case here. It’s neither illusory nor un-enforceably indefinite.

Really, the only thing we’re concerned with is the reasonableness of Dad’s refusal to accept the kids’ college choices. Dad thinks Indie’s tuition should be capped at UVM’s tuition, that he shouldn’t have to pay anything for UMSON because she transferred, and Francesca’s tuition should be limited to a two-year dental hygiene degree at VTC. The kids probably should have studied veterinary medicine to save Dad some money on those horses. And, any scholarships those kids earned should not be applied to the kids’ costs, but Dad’s. He needs that money for horse food. But the SCOV says that just because the kids could have gone to less expensive schools, does not mean that his obligation should be reduced. Also, the application of scholarship and grant funds goes to the kids’ expenses because the agreement doesn’t say that PA law is silent on the issue.

In the end, Dad has to pony up the dough. That must stirrup some emotions. I’d like to thank all of you chaps for reading this far. I can’t horse around here any more. I have to giddy-up and go. I mare may not have to trot off. You stay golden, Ponyboy.

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