Opinion ID: 4509466
Heading Depth: 1
Heading Rank: 1

Heading: The Tuition Agreement

Text: ¶ 9. Defendant does not contest the trial court’s finding that the parties at one point agreed to share the college tuition expenses of their children, with plaintiff paying 75% and defendant 25% of the total amount. However, she argues that this agreement did not constitute a contract between the parties, because neither was under any legal obligation to pay their children’s tuition and therefore any agreement between them benefitted only third parties—their children— and lacked consideration. As a result, she contends that the trial court’s conclusion that a binding contract existed concerning the payment of tuition expenses was erroneous. Although neither party seeks enforcement of the initial tuition agreement, its enforceability matters because defendant claims that there was no tuition agreement to be modified by the second agreement regarding waiver of the COLA, arguing that, in the absence of an enforceable underlying contract, no modification of the same could exist. Indeed, the trial court found that the benefit defendant received in the second alleged contract was plaintiff’s agreement to waive his right to enforce the provision of their first agreement requiring defendant to pay 25% of their children’s college tuition bills.4 We conclude that, if the tuition-sharing agreement was indeed unenforceable, then defendant is correct in asserting that plaintiff’s waiver of his right to enforce the same was not consideration. ¶ 10. This is so because consideration exists only where a promisee “giv[es] up something which the promisee was theretofore privileged to retain, or doing or refraining from 4 Although the trial court found that, following the alleged second agreement, plaintiff paid 100% of their daughter’s tuition expenses, it did not find that plaintiff agreed to do so in exchange for defendant’s promise to waive his COLA obligation. As to that exchange, the trial court found only that plaintiff promised to waive defendant’s obligation to pay 25% of the bill. 5 doing something which the promisee was then privileged not to do, or not to refrain from doing.” 3 R. Lord, Williston on Contracts § 7:4 (4th ed. 2019). A promise to refrain from doing something which the promisee was never legally empowered to do—like a promise to do what one is already legally bound to do—“creates no new duty and cannot support an action; nor does it afford a consideration for a promise by the other party.” Manley v. Vt. Mut. Fire Ins. Co., 78 Vt. 331, 336, 62 A. 1020, 1021 (1906) (holding that “if one promises to do what he is already legally bound to do, the promise is nude”). Accordingly, we must consider whether a valid contract existed regarding the payment of tuition. ¶ 11. We first observe that mutual promises may provide the necessary consideration for contract formation. H.P. Hood & Sons v. Heins, 124 Vt. 331, 337, 505 A.2d 561, 565 (1964) (“ ‘Mutual promises, in each of which the promisor undertakes some act or forbearance that will be, or apparently may be, detrimental to the promisor or beneficial to the promisee, and neither of which is void, are sufficient consideration for one another.’ ” (quoting 1 Williston on Contracts § 103 (3rd ed. 1957)); see also Bergeron, 2003 VT 89, ¶ 19 (finding “bargained for exchange of mutual promises was sufficient consideration to support the contract”). Plaintiff’s agreement to pay 75% of their children’s tuition costs if defendant would pay 25% of the same was such an exchange of mutual promises and could provide the necessary consideration for contract formation. ¶ 12. Defendant is correct in noting that parents have no legal obligation to support their children beyond the age of minority, and that family courts are thus powerless to order postsecondary education payments absent the agreement of the parties. See Milligan v. Milligan, 158 Vt. 436, 441-43, 613 A.2d 1281, 1284-85 (1992); 15 V.S.A. § 659(b) (“If the parties agree, the court may include in the child support order an additional amount designated for the purpose of providing for postsecondary education.”). However, she misapprehends the effect of this circumstance on the existence of consideration in an agreement between the parties. To satisfy the 6 consideration requirement, the parties did not have to obtain benefits which fulfilled preexisting legal obligations. “Simply put,” in order to satisfy the consideration requirement, “the promisor must receive something desired for his or her own advantage.” Lloyd’s Credit Corp. v. Marlin Mgmt. Servs., Inc., 158 Vt. 594, 599, 614 A.2d 812, 815 (1992) (explaining that “a mere expectation or hope of benefit is sufficient to serve as consideration” (quotation omitted)). Moreover, the logical implication of the fact that a court could not order the parties to pay for their children’s postsecondary education absent the parties’ agreement is that the parties may agree to fund their children’s postsecondary pursuits. ¶ 13. Nor does the fact that the benefits obtained in this agreement may flow largely to third parties preclude a determination of consideration. Restatement (Second) of Contracts § 71 cmt. e (1981) (“It matters not from whom the consideration moves or to whom it goes. If it is bargained for and given in exchange for the promise, the promise is not gratuitous.”); see also Kneebinding, Inc. v. Howell, 2014 VT 51, ¶ 17, 196 Vt. 477, 99 A.3d 612 (noting that “[t]he definition of a benefit is extremely broad” (quotation omitted)). Here, the parties both wanted their children’s college tuition bills to be paid. In sum, both committed, to their detriment, and based upon the promise of the other party, to pay monies they were not obligated to pay. Plaintiff’s agreement to pay 75% of the children’s tuition costs was what defendant bargained for in exchange for her agreement to pay 25% of those costs. Thus, there was consideration for the tuition agreement. ¶ 14. Because it is not for the court to determine the adequacy of that consideration, and defendant does not contend that the other requisites for a binding contract were not present, this ends our inquiry concerning the initial tuition agreement. See Lloyd’s Credit Corp., 158 Vt. at 599, 614 A.2d at 815 (“[C]onsideration can exist without economic benefit or advantage; a benefit need not be measurable in money. The extent of a benefit is not important; a very slight advantage is sufficient to constitute consideration.” (quotations and citation omitted)); see also Restatement 7 (Second) of Contracts § 79 (“If the requirement of consideration is met, there is no additional requirement of . . . equivalence in the values exchanged.”). We hold that the tuition agreement was a valid contract between the parties such that, if plaintiff agreed to waive defendant’s obligation thereunder in connection with the second agreement, he would have given up a legal right he was otherwise free to exercise.