Source: https://familylaw.typepad.com/virginiafamilylawappeals/college-expenses/
Timestamp: 2019-04-25 06:27:11+00:00

Document:
Virginia's Court of Appeals affirms a decision that paying the couple's son's college tuition was waste and counts against the husband's share of marital assets; finding no sufficient tracing of the admittedly existing separate-property share of employer stock and retirement accounts; and that lay testimony on rental value, though admissible with a proper foundation, need not be believed.
"Once the aggrieved spouse shows that marital funds were either withdrawn or used after the breakdown, the burden rests with the party charged with dissipation to prove that the money was spent for a proper purpose." Clements v. Clements, 10 Va. App. 580, 586, 397 S.E.2d 257, 261 (1990). ... husband had the burden of proving, by a preponderance of the evidence, that his expenditure of the funds "was . . . for a proper purpose."
Although we have affirmed the decisions of trial courts finding that payment of an adult child's college expenses was not waste in those cases, see id. at 587-88, 397 S.E.2d at 262; Amburn v. Amburn, 13 Va. App. 661, 666, 414 S.E.2d 847, 850 (1992), we have not held that, as a matter of law, such payments are never waste.
. . . the parties' separation agreement did not provide that either parent was obligated to pay for college or graduate school for either child. In fact, regarding education decisions, the agreement required equal input from both parents; however, husband unilaterally decided to use a marital asset to make the tuition payments.
... despite some visits, husband was largely absent from the children's lives and ... wife bore the burden of raising them. The evidence also establishes that the son had issues regarding his education before adulthood, with husband noting that the son "had a somewhat difficult high school career" and only "had gotten his life on track in college." Additionally, the trial court could consider that the payments were made years after the parties' final separation, with a majority of the payments occurring more than a decade after the effective end of the marriage. These additional facts, when considered with everything else, allow a reasonable factfinder to conclude that the husband's payment of son's tuition was an attempt to improve his relationship with his son and was "for [husband's] own benefit and for a purpose unrelated to the marriage." Clements, 10 Va. App. at 586, 397 S.E.2d at 261.
The trial court specifically stated that it was satisfied with the explanations offered by the husband that the money contained in these accounts was used primarily for household and tuition expenses, a finding which ... is supported by the checks themselves.
The observation that the separation agreement required joint educational decisionmaking seems like a far better argument than the downright lame and insulting argument that the tuition payments were nutrition-free goodies to bribe the child to forgive the long-distant father, especially since the rest of the evidence quoted indicates that college was very worthwhile for this child. However, there is nothing in the opinion saying whether attending this college was the decision of the mother, the father, both, or neither; whether the college decision was made when the child was under 18 and that provision of the separation agreement was therefore still in force (the graduate school decision certainly wasn't); nor what the mother had said about the payments at the times they were made. The opinion does not say that attending or paying for college and graduate school were the father's unilateral decisions, only that "husband unilaterally decided to use a marital asset to make the tuition payments." Nor is there anything about what non-marital sources were available for the payments. Nor whether the husband thought at the time that the assets were marital, or had even heard of the concept -- but that question does not seem to matter in any of these waste/improper expenditure cases.
On the other hand, there certainly are cases where a unilateral expenditure for the child IS a frivolous, and often intentional and malicious, waste of marital assets. But it would be a good rule of public policy to have a rebuttable presumption that educational expenses are not that. It should be rebuttable by the trial court bringing together evidence and weighing it, not by scattered pieces of evidence that are put together only by an appeals court to speculate that the trial court might have been able to do so.
The funds came from an employee stock ownership plan that was partly from before the marriage. The trial court found that these funds were hopelessly comingled. This is upheld because the husband did not meet his burden of "tracing the value of the initial investment separate and apart for [sic] any investment of marital funds. Husband, citing a lack of recordkeeping over the lengthy time period, was unable to establish the value of the stock at the relevant intervals that might allow the trial court to determine a separate property value as distinguished from the presumptively marital whole."
The husband also had employer stock at the time of separation and continued adding stock to that account after separation, and argued that the burden should be on the wife to prove what was marital. But the trial court called this "potentially separate property that had been commingled with marital property when it was held in the same account", and "because there was no evidence as to the number of shares added post-separation or of what was the change in value of the account post-separation, the trial court could not accurately differentiate between the separate and marital components."
"Generally, property acquired by one partner after the last separation . . . will not be marital property. . . ." Dietz v. Dietz, 17 Va. App. 203, 210, 436 S.E.2d 463, 468 (1993). Property that is acquired post-separation can "be classified as marital" only if the party making such a claim can "prov[e], without the benefit of a presumption, that it was acquired while some vestige of the marital partnership continued or was acquired with marital assets." Id. at 211-12, 436 S.E.2d at 469.
-- nevertheless, once the wife proved that some marital assets were exchanged for the new stock post-separation, the burden of tracing how much was separate rested, again, on the party claiming a separate property interest.
Likewise, the husband's partly-separate IRA was classified as entirely marital because he did not meet the burden of tracing a specific separate portion, and the Court roundly rejects his argument that the burden was on the wife who claimed it was marital, citing "Chretien v. Chretien, 53 Va. App. 200, 205 n.1, 670 S.E.2d 45, 48 n.1 (2008); Frazer v. Frazer, 23 Va. App. 358, 370-71, 477 S.E.2d 290, 296 (1996); see also Pence v. Pence, 2016 Va. App. LEXIS 275, at *25 (Va. Ct. App. Oct. 18, 2016) ('a retirement "account created or added to during the marriage is presumed to be marital property.'"
The Court upholds the trial court's ability to rule that a party's lay testimony about the rental value of the home was admissible under Evidence Rule 2:701, but happened to have "virtually no probative value."

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