Wife Receives a Credit of 50% of Husband’s Premarital Debt Paid During the Marriage

In Mahoney-Buntzman v. Buntzman, 51 A.D.3d 732 (2nd Dept. 2008) the Appellate Division held that the wife should have been awarded 50% credit for student loan debt incurred by the husband to obtain a doctoral degree. During the parties’ marriage, the husband took out a student loan in the amount of $48,162.90 to pay for a doctoral degree in education, which was satisfied with marital funds. The wife contended on appeal that the trial court erred in failing to award her a 50% credit with respect to the student loan. The Appellate Division agreed. The husband’s expert testified that the doctoral degree earned by the husband during the marriage did not enhance his earnings, and thus, provided no benefit to the marriage, and there was no distributive award of the value of the doctorate degree to the wife in light of its zero enhanced earning capacity value. As result, the court concluded that the student loan debt was incurred to satisfy the husband’s separate interest and therefore was his own separate obligation. Accordingly, the trial court erred in failing to award the plaintiff a 50% credit, or $24,081.45, for the student loan debt incurred by the husband during the marriage to obtain this degree.
The Appellate Division also agreed with the wife’s contention that the trial court erred in not crediting her with 50% of the defendant’s pre-marital debts paid with marital funds during the marriage such as maintenance paid to the husband’s first wife in the total amount of $58,545, and $7,000 paid in 1998 as a settlement of a loan for a boat purchased by the husband before the marriage but surrendered to the bank in 1993 prior to the marriage for nonpayment of the boat loan. The husband’s maintenance obligation to his first wife and the boat loan constituted debts incurred by him prior to the parties’ marriage and were solely his responsibility. Accordingly, the trial court erred in failing to award the plaintiff additional credits of $29,272.50 as to the maintenance payments to the husband’s first wife and $3,500 as to the boat loan.
Thus, with respect to his doctoral degree, the husband was successful in convincing the trial court that the degree did not enhance his earnings. If the wife was successful in establishing that the degree resulted in enhanced earnings, those enhanced earnings would be subject to distribution. Therefore, the husband would owe something to the wife under either scenario.