Saving Agreements with Defective or Missing Temporary Maintenance Agreements

Editor's Note: In 2010, New York's Legislature enacted Domestic Relations Law (DRL) ' 236, Part B, subd. 5-a, in 2010. The statute, among other things, requires that agreements concerning temporary maintenance that deviate from its formula must, to be be enforceable, contain calculations for the amount that would have been set by the formula, along with a recitation that that amount is the presumed correct number, yet the parties deviated from it for reasons enumerated in the agreement. This statute's language is identical to that in The Child Support Standards Act, Family Court Act ' 413 subd. 1(h). But, although there are many cases concerning the viability of agreements that deviate from the child support guidelines, few judicial opinions have interpreted whether temporary maintenance agreements that lack the required opt-out provisions are enforceable.

The author continues here with more suggested arguments for saving a temporary maintenance agreement that does not contain the language and recitations required by subdivision 5-a(f) of DRL ' 236B.

6. If the parties have lived under the agreement for some time, it can be argued that they have ratified the agreement despite the lack of recitals.

In light of the weakness of the H.W. court's stated rationale for upholding the Interim Agreement, a reading of the entire decision suggests that the court wanted to do so because the husband had accepted benefits under it for 22 months. The court found that behavior to be a ratification and the most significant reason for rejecting the husband's claim the agreement was unconscionable. The court returned to those facts after discussing the recital requirement and concluded that “[h]aving elected to enter into and accept the benefits of” the Interim Agreement, the husband could not attack it for lack of recitals. Id. at *9 (citing a case that predated the 2010 statute).

Although the husband's actions make him less sympathetic, they probably should not have destroyed his legal attack. Subdivision 5-a(f) says that the recital requirements “may not be waived by either party or counsel.” If a party cannot waive a requirement by saying he means to do so, he should not be able to waive that requirement (at least not prospectively) by accepting benefits ' which is a less clear and less well-informed statement.

Even if the party who attacks an agreement has not received (or paid) support under it, he or she may have received other benefits from the agreement. For example, he or she may have enjoyed exclusive use of a home because of a separation agreement. And if the agreement at issue predated the parties' marriage, the marriage itself may have been part of the consideration for the agreement. In all these situations, it is at least possible that ratification will save an agreement, despite the explicit statutory language against waiver.

7. An argument can be made that the new requirements do not apply to properly executed marital agreements at all.

Yet another way of defending agreements that do not include the recitals required by subdivision 5-a(f) is to assert that that paragraph (and indeed all of subdivision 5-a) does not apply. That argument has not been raised in, much less endorsed by, any court. Admittedly, it seems to defy the intent of subdivision 5-a(f). The statutory text, however, arguably supports the assertion, and it can be reconciled with the Legislature's intent.

The key phrase appears at the start of subdivision 5-a, which governs temporary maintenance: “Except where the parties have entered into an agreement pursuant to subdivision three of this part providing for maintenance, in any matrimonial action the court shall make its award for temporary maintenance pursuant to the provisions of this subdivision.” DRL ' 236B subd. 5-a(a). Paragraph f, the recital requirement, makes no reference to that exception. But paragraph f is part of subdivision 5-a. One can, therefore, at least argue that when the parties have made a marital or premarital agreement that satisfies subdivision 3 of DRL ' 236B, the court need not “make its decision pursuant to” subdivision 5-a(f) ' which means that the court need not invalidate an agreement that lacks recitals. (The CSSA does not include any such exception, in its recital requirement or elsewhere.)

One obvious problem with this argument is that the exception almost eats the rule: If the recital requirements do not apply to agreements under DRL ' 236B subd. 3 that provide for maintenance, then they apply to very few agreements, if any. The recital requirements would, however, still apply to stipulations regarding temporary maintenance that do not satisfy subdivision 3. In the First and Second Departments, a stipulation made while a matrimonial action is pending can be effective without satisfying subdivision 3, as long as it meets the lesser requirements of CPLR Rule 2104 (such as by being spread on the record in open court). The Third and Fourth Departments, however, require all stipulations to satisfy ' 236B(3), so the argument above would make ' 236B(5-a)(f) moot in those departments. See Alan D. Scheinkman, Practice Commentary C236B:18 (noting this split among the Appellate Divisions).

8. Even if a recital is misstated or omitted, it can be argued that the error was not substantial.

Although DRL ' 236B subd. 5-a(f) makes sweeping statements about what an agreement “must specify” and what it “shall include,” the same language appears in the CSSA, and courts applying it have managed to overlook small errors. A practitioner should not rely on such judicial indulgence. It is, however, worth requesting, especially because it is so difficult to comply completely with the recital requirements.

Errors arise regularly because the CSSA formula, and in particular the definition of “income” on which it is based, is so complex. Errors will surely also arise under the temporary maintenance formula, which uses the same definition of “income.”

In general, although the CSSA requires agreements to “specify the amount that [the] basic child support obligation would have been,” courts often enforce agreements with small errors. See, e.g., Blaikie v. Mortne , 274 AD2d 95, 100-01 (1st Dept. 2000) (enforcing an agreement that gave only “approximate” values for the guideline amount of support and that recited that those amounts were “just and appropriate,” rather than that they were “correct”); Baker v. Baker, 291 AD2d 751, 753-54 (3rd Dept. 2002) (ignoring an error that would have made a “negligible” difference in the basic support amount).

One of the more forgiving decisions enforced an agreement between parties who had two children, and who had recited that their basic child support obligation was 20% or 25% of their combined income, when in fact the figure was 25%. Compare Echeverri v. Echeverri, 278 AD2d 130, 131 (1st Dept. 2000) with DRL ' 240 subd. 1-b(b)(3)(ii). If the parties deviated from the guideline amount, the reasons that they gave for the deviation may help show that a miscalculation did not affect their agreement and so should be ignored. For example, in one case, the parties had overstated a father's income and therefore overstated the guideline amount of child support he should pay, but that error was “of no significance” because he had agreed to pay more than the guideline amount anyway, based on his child's needs. Tremont v. Tremont, 35 AD3d 1046, 1049 (3rd Dept. 2006). (The Tremont panel apparently inferred that the father had decided to provide whatever the child needed and so, had he known the correct guideline amount, he would have made the same agreement. That does not necessarily follow; the father might have weighed his child's needs against his own income and decided he was willing to pay a certain amount beyond the guideline but no more.)

Other cases, however, apply the CSSA strictly to invalidate agreements in whole or in part. For example, maintenance payments reduce “income” as defined by the CSSA, and therefore affect the guideline amount of child support, in some cases but not others. DRL ' 240 subd. 1-b(b)(5)(vii)(B), (C). The Third Department, quoting statutory “musts,” held that if the recitals omit such a deduction when the CSSA requires one, the resulting agreement is invalid. St. Louis v. St. Louis, 86 AD3d 706, 708-09 (2011). In another cautionary case, the parties stipulated that the husband would pay $24,000 per year in child support, and recited that they were deviating upwards from a guideline amount that would have been between $18,675 and $20,750. D.S. v. T.S., 7 Misc.3d 1024(A), 2005 WL 1160187, *2 (Sup. Ct. Nassau County May 17, 2005). The guideline amount would have varied depending on how the court treated income over the threshold, which was then $86,000 per year. The drafters, however, had forgotten that FICA taxes are deducted from CSSA “income,” and so the formula amount of support was really only $17,316 per year ' $1,359 to $3,434 per year less than the parties believed. That error, the court found, was “material and substantial and is sufficient to vitiate the child support provisions of the stipulation.” Id. at *3. (For good measure, even though the CSSA did not require it, the Supreme Court held that the parties should have been made aware of what the result would have been if the husband's maintenance payments had been subtracted from his CSSA income ' which is required in some cases but not in D.S. That change would have yielded child support of $13,167 a year. Id . at *3-*4 (reviewing DRL ' 240(1'b)(b)(5)(vii)(C)).) The court also invalidated the provisions on maintenance, because “it is arguable that the parties would have provided for greater spousal maintenance, if they had agreed to fix the husband's child support using CSSA guidelines.” Id. at *5.

9. If all else fails and the agreement is not enforced, it may still be taken into account in setting temporary maintenance.

If a court declines to enforce an agreement regarding temporary maintenance because the recitals are faulty or omitted, it will have to set temporary maintenance pursuant to subdivision 5-a. That means applying the infamous lists of 17 factors. Subd. 5-a(e)(1). (Or, if the payor's income exceeds the cap, 19 factors. Subd. 5-a(c)(2)(a). In such cases the court is obliged to review both lists, but they overlap.) Each list concludes with the catch-all “any other factor which the court shall expressly find to be just and proper.” Counsel can argue that, even if an agreement is not binding, it is “just and proper” to consider, in setting temporary maintenance, the amount the parties had tried to agree to ' especially if that amount seems to reflect conclusions about what they needed to maintain the marital standard of living and/or what the payor could afford. Of course, a party who deliberately misstated his or her income cannot say it is “just” to benefit from the error. Those catch-all factors invite a court, however, to overlook minor or technical errors. Cf. Christopher C. v. Bonnie C , 40 Misc.3d 859, 866 (Sup. Ct. Suffolk County 2013) (distributing property on the basis of an agreement the parties had made “voluntarily and fairly,” even though only part of that agreement was memorialized with a writing and none of it was acknowledged).

Conclusion

Family law practitioners will recognize the recital requirements of the Child Support Standards Act as threats that can invalidate even carefully drafted agreements. In the temporary maintenance statute, the Legislature created a similar set of threats that apply to an even broader array of agreements. The two reported cases, however, have found several rationales for upholding agreements that do not satisfy the statute, and this article ' based on the wording of the statute and case law under the CSSA ' suggests still others.

Matthew A. Feigin , an attorney at Katsky Korins LLP, thanks Marcy L. Wachtel for her review and input and Peter E. Bronstein for encouraging him to explore the recital requirements.

Editor's Note: In 2010, New York's Legislature enacted Domestic Relations Law (DRL) ' 236, Part B, subd. 5-a, in 2010. The statute, among other things, requires that agreements concerning temporary maintenance that deviate from its formula must, to be be enforceable, contain calculations for the amount that would have been set by the formula, along with a recitation that that amount is the presumed correct number, yet the parties deviated from it for reasons enumerated in the agreement. This statute's language is identical to that in The Child Support Standards Act, Family Court Act ' 413 subd. 1(h). But, although there are many cases concerning the viability of agreements that deviate from the child support guidelines, few judicial opinions have interpreted whether temporary maintenance agreements that lack the required opt-out provisions are enforceable.

The author continues here with more suggested arguments for saving a temporary maintenance agreement that does not contain the language and recitations required by subdivision 5-a(f) of DRL ' 236B.

6. If the parties have lived under the agreement for some time, it can be argued that they have ratified the agreement despite the lack of recitals.

In light of the weakness of the H.W. court's stated rationale for upholding the Interim Agreement, a reading of the entire decision suggests that the court wanted to do so because the husband had accepted benefits under it for 22 months. The court found that behavior to be a ratification and the most significant reason for rejecting the husband's claim the agreement was unconscionable. The court returned to those facts after discussing the recital requirement and concluded that “[h]aving elected to enter into and accept the benefits of” the Interim Agreement, the husband could not attack it for lack of recitals. Id. at *9 (citing a case that predated the 2010 statute).

Although the husband's actions make him less sympathetic, they probably should not have destroyed his legal attack. Subdivision 5-a(f) says that the recital requirements “may not be waived by either party or counsel.” If a party cannot waive a requirement by saying he means to do so, he should not be able to waive that requirement (at least not prospectively) by accepting benefits ' which is a less clear and less well-informed statement.

Even if the party who attacks an agreement has not received (or paid) support under it, he or she may have received other benefits from the agreement. For example, he or she may have enjoyed exclusive use of a home because of a separation agreement. And if the agreement at issue predated the parties' marriage, the marriage itself may have been part of the consideration for the agreement. In all these situations, it is at least possible that ratification will save an agreement, despite the explicit statutory language against waiver.

7. An argument can be made that the new requirements do not apply to properly executed marital agreements at all.

Yet another way of defending agreements that do not include the recitals required by subdivision 5-a(f) is to assert that that paragraph (and indeed all of subdivision 5-a) does not apply. That argument has not been raised in, much less endorsed by, any court. Admittedly, it seems to defy the intent of subdivision 5-a(f). The statutory text, however, arguably supports the assertion, and it can be reconciled with the Legislature's intent.

The key phrase appears at the start of subdivision 5-a, which governs temporary maintenance: “Except where the parties have entered into an agreement pursuant to subdivision three of this part providing for maintenance, in any matrimonial action the court shall make its award for temporary maintenance pursuant to the provisions of this subdivision.” DRL ' 236B subd. 5-a(a). Paragraph f, the recital requirement, makes no reference to that exception. But paragraph f is part of subdivision 5-a. One can, therefore, at least argue that when the parties have made a marital or premarital agreement that satisfies subdivision 3 of DRL ' 236B, the court need not “make its decision pursuant to” subdivision 5-a(f) ' which means that the court need not invalidate an agreement that lacks recitals. (The CSSA does not include any such exception, in its recital requirement or elsewhere.)

One obvious problem with this argument is that the exception almost eats the rule: If the recital requirements do not apply to agreements under DRL ' 236B subd. 3 that provide for maintenance, then they apply to very few agreements, if any. The recital requirements would, however, still apply to stipulations regarding temporary maintenance that do not satisfy subdivision 3. In the First and Second Departments, a stipulation made while a matrimonial action is pending can be effective without satisfying subdivision 3, as long as it meets the lesser requirements of CPLR Rule 2104 (such as by being spread on the record in open court). The Third and Fourth Departments, however, require all stipulations to satisfy ' 236B(3), so the argument above would make ' 236B(5-a)(f) moot in those departments. See Alan D. Scheinkman, Practice Commentary C236B:18 (noting this split among the Appellate Divisions).

8. Even if a recital is misstated or omitted, it can be argued that the error was not substantial.

Although DRL ' 236B subd. 5-a(f) makes sweeping statements about what an agreement “must specify” and what it “shall include,” the same language appears in the CSSA, and courts applying it have managed to overlook small errors. A practitioner should not rely on such judicial indulgence. It is, however, worth requesting, especially because it is so difficult to comply completely with the recital requirements.

Errors arise regularly because the CSSA formula, and in particular the definition of “income” on which it is based, is so complex. Errors will surely also arise under the temporary maintenance formula, which uses the same definition of “income.”

In general, although the CSSA requires agreements to “specify the amount that [the] basic child support obligation would have been,” courts often enforce agreements with small errors. See, e.g., Blaikie v. Mortne , 274 AD2d 95, 100-01 (1st Dept. 2000) (enforcing an agreement that gave only “approximate” values for the guideline amount of support and that recited that those amounts were “just and appropriate,” rather than that they were “correct”); Baker v. Baker , 291 AD2d 751, 753-54 (3rd Dept. 2002) (ignoring an error that would have made a “negligible” difference in the basic support amount).

One of the more forgiving decisions enforced an agreement between parties who had two children, and who had recited that their basic child support obligation was 20% or 25% of their combined income, when in fact the figure was 25%. Compare Echeverri v. Echeverri , 278 AD2d 130, 131 (1st Dept. 2000) with DRL ' 240 subd. 1-b(b)(3)(ii). If the parties deviated from the guideline amount, the reasons that they gave for the deviation may help show that a miscalculation did not affect their agreement and so should be ignored. For example, in one case, the parties had overstated a father's income and therefore overstated the guideline amount of child support he should pay, but that error was “of no significance” because he had agreed to pay more than the guideline amount anyway, based on his child's needs. Tremont v. Tremont , 35 AD3d 1046, 1049 (3rd Dept. 2006). (The Tremont panel apparently inferred that the father had decided to provide whatever the child needed and so, had he known the correct guideline amount, he would have made the same agreement. That does not necessarily follow; the father might have weighed his child's needs against his own income and decided he was willing to pay a certain amount beyond the guideline but no more.)

Other cases, however, apply the CSSA strictly to invalidate agreements in whole or in part. For example, maintenance payments reduce “income” as defined by the CSSA, and therefore affect the guideline amount of child support, in some cases but not others. DRL ' 240 subd. 1-b(b)(5)(vii)(B), (C). The Third Department, quoting statutory “musts,” held that if the recitals omit such a deduction when the CSSA requires one, the resulting agreement is invalid. St. Louis v. St. Louis , 86 AD3d 706, 708-09 (2011). In another cautionary case, the parties stipulated that the husband would pay $24,000 per year in child support, and recited that they were deviating upwards from a guideline amount that would have been between $18,675 and $20,750. D.S. v. T.S. , 7 Misc.3d 1024(A), 2005 WL 1160187, *2 (Sup. Ct. Nassau County May 17, 2005). The guideline amount would have varied depending on how the court treated income over the threshold, which was then $86,000 per year. The drafters, however, had forgotten that FICA taxes are deducted from CSSA “income,” and so the formula amount of support was really only $17,316 per year ' $1,359 to $3,434 per year less than the parties believed. That error, the court found, was “material and substantial and is sufficient to vitiate the child support provisions of the stipulation.” Id. at *3. (For good measure, even though the CSSA did not require it, the Supreme Court held that the parties should have been made aware of what the result would have been if the husband's maintenance payments had been subtracted from his CSSA income ' which is required in some cases but not in D.S. That change would have yielded child support of $13,167 a year. Id . at *3-*4 (reviewing DRL ' 240(1'b)(b)(5)(vii)(C)).) The court also invalidated the provisions on maintenance, because “it is arguable that the parties would have provided for greater spousal maintenance, if they had agreed to fix the husband's child support using CSSA guidelines.” Id. at *5.

9. If all else fails and the agreement is not enforced, it may still be taken into account in setting temporary maintenance.

If a court declines to enforce an agreement regarding temporary maintenance because the recitals are faulty or omitted, it will have to set temporary maintenance pursuant to subdivision 5-a. That means applying the infamous lists of 17 factors. Subd. 5-a(e)(1). (Or, if the payor's income exceeds the cap, 19 factors. Subd. 5-a(c)(2)(a). In such cases the court is obliged to review both lists, but they overlap.) Each list concludes with the catch-all “any other factor which the court shall expressly find to be just and proper.” Counsel can argue that, even if an agreement is not binding, it is “just and proper” to consider, in setting temporary maintenance, the amount the parties had tried to agree to ' especially if that amount seems to reflect conclusions about what they needed to maintain the marital standard of living and/or what the payor could afford. Of course, a party who deliberately misstated his or her income cannot say it is “just” to benefit from the error. Those catch-all factors invite a court, however, to overlook minor or technical errors. Cf. Christopher C. v. Bonnie C , 40 Misc.3d 859, 866 (Sup. Ct. Suffolk County 2013) (distributing property on the basis of an agreement the parties had made “voluntarily and fairly,” even though only part of that agreement was memorialized with a writing and none of it was acknowledged).

Conclusion

Family law practitioners will recognize the recital requirements of the Child Support Standards Act as threats that can invalidate even carefully drafted agreements. In the temporary maintenance statute, the Legislature created a similar set of threats that apply to an even broader array of agreements. The two reported cases, however, have found several rationales for upholding agreements that do not satisfy the statute, and this article ' based on the wording of the statute and case law under the CSSA ' suggests still others.

Matthew A. Feigin , an attorney at Katsky Korins LLP, thanks Marcy L. Wachtel for her review and input and Peter E. Bronstein for encouraging him to explore the recital requirements.