What is a Stipulation Agreement?
A stipulation agreement is a document that memorializes the parties’ agreement on particular issues for a family law matter. The purpose of such an agreement is to help facilitate the negotiation process and to put parameters around certain issues. That agreement is then submitted to the Court and incorporated into an Order of the Court.
Common contexts where these agreements are entered into are with regard to spousal support (temporary or permanent, as well as child support. These agreements are often "Hagan" agreements, referring to the 1984 Pennsylvania Supreme Court case of Hagan v. Hagan.
Stipulation agreements can take other forms, and some stipulation agreements provide for waivers of rights or remedies. An example of this can be found in In re Degroot. There, the husband and wife negotiated their divorce at a master’s conference. Their agreement was then incorporated into an order. The terms were not reduced to writing or both signed. The husband subsequently sought to have the agreement set aside based on the strong bargaining power of his wife. Specifically, the husband alleged that the wife kept him from taking their children out of the country because their passports were held by her, despite his repeated pleas. Further, the husband averred the credit cards were being maxed out , his mother was being pressured to pay the children’s private school tuition, and that he had to get a second job to make ends meet. By way of contrast, the wife averred that the husband just did not want to pay his fair share of the children’s expenses.
Without making any factual determinations, the Court expressly said that when parties negotiate the disposition of all claims against each other as they did in this case, the agreement is enforceable and the outcome must be observed. However, the trial court must inquire into whether the property distribution and spousal support are unconscionably inequitable.
While a stipulation agreement can be modified or set aside if the husband can show unconscionable conduct in its formation or execution, an express finding of unconscionable conduct was absent in the first instance. Therefore, the trial court failed to determine whether the agreement was unconscionably inequitable. At a minimum, the trial court should have examined the allegations evidencing a manifest injustice.
Stipulation agreements may take many forms – from general to specific, and both simple and sophisticated. A party looking to enter into a stipulation agreement would be well advised to have competent counsel assist them in resolving any family law dispute.
When Can a Stipulation Agreement Be Changed?
There are several circumstances which may warrant or necessitate a change to your Stipulation Agreement, such as:
Change in Circumstances
– The law in New York State allows for the modification of a Stipulation Agreement or Judgment based upon a substantial change in circumstances. A substantial change in circumstances occurs where the changes that have taken place since the entry of your Stipulation Agreement are material to the issues in your Stipulation Agreement or Judgment. In other words, if the changes which have occurred relate directly to the issues at hand, a Court will consider the changes substantial enough to justify a modification of your Stipulation Agreement. In contrast, the Court will not take into account changes stemming from the voluntary actions of the party requesting the change. The most common forms of a substantial change in circumstances are: 1. The loss of a job 2. Unemployment or underemployment 3. Involuntary relocation 4. Relocation due to medical restraints 5. Bankruptcy 6. Injury or sickness 7. Child’s change in circumstances
Mutual Consent
– A Stipulation Agreement, if applicable to your case, can be modified by the mutual consent of the parties involved. An agreement is valid as long as the terms are fair and enforceable, and the agreement is signed by both spouses. However, an agreement can also be amended or modified by obtaining the consent of both parties rather than by applying to Court. The only requirement is that the agreement is fair and it should be in writing.
How to Legally Modify a Stipulation Agreement
The process to change a stipulation agreement is a two-step process, the first step which involves filing a motion with the court to seek permission from the court to change the stipulation agreement. Sometimes, the judge will want the parties to obtain the Court’s permission so that if one of the parties fails to abide by the agreement, there is already a court order which can be enforced. Moreover, the other reason to seek the Court’s permission to change a stipulation is because the judge may want to see that the change will be in the child’s best interests, rather than just what the parties want.
The second step will be a hearing. As a matter of judicial economy in the Family Part, the more difficult the issue being heard is the more time the family part judges seem to have for hearings (rather than being let out early in the calendar). The judge will also likely want to see the testimony of each of the parties. In addition, the judge will likely want to see the other documentation which you would provide for an Initial Case Management Conference, such as the Case Information Statement. If the other party was at a mediation in which the new agreement was reached, the mediator’s certification will also be an important document to provide to the judge. In addition, the judge may want to hear from a family expert or therapist as to the basis for the change or whether the change will be good for the child.
Troubleshooting Modifying a Stipulation Agreement
Once an agreement is reached between the parties and entered as an Order by the Judge, it can become extremely difficult to have it changed. The Courts are very much in favor of accepting stipulations between the parties if they do not cause a substantial change of circumstances to one party and/or if the changes a party is seeking are insignificant . For example, if you have an Order for Parenting time and the parenting time needs to become more flexible for work reasons, the Judge will likely order the parties to work together to make a more flexible schedule. However, if there is an issue with one party taking advantage of the other or is in contempt of Court, the Judge will be less accommodating.
Getting Legal Counsel for Modifying an Agreement
Consulting an attorney when considering changing or altering a stipulation agreement is crucial. These experienced professionals can help inform you of your rights, the impact the proposed changes could have, as well as help you navigate all legal matters. To make area even more complicated, some states have their own specific laws surrounding guidances and support orders, and whether or not they can be changed, altered and amended. An attorney can take your state’s laws into consideration before presenting a plan to you, and then help you implement it once you’ve entered into an agreement that is right for you. As you work towards coming up with an agreement that suits you and your family the best, it’s vital to enlist the help of a legal professional. They’ll be able to guide you through the entire process and provide you detailed information on all aspects of a stipulation agreement. This allows you to fully understand your rights and responsibilities when it comes to paying alimony or receiving child support.
Case Studies on Modifying an Agreement
Illinois divorce and family law can be confusing, and spouses may not know their rights. But in a few select cases, spouses are able to re-negotiate their agreements years later. Below are some examples of successful agreement modifications. Even with these successes, it’s worth noting that the spouses were still required to make an agreement to satisfy the court.
The spouses in this case entered into a Marriage Settlement Agreement in their Chicago area divorce. Both parties had sizeable financial resources from which to draw, but the husband’s income was substantially higher than the wife’s.
The wife’s father died during the one year period between the signing of the agreement and the final judgment of divorce. The wife received a substantial inheritance of cash, Illinois real estate, and a mortgage note, which she wanted to put toward the mortgage on the marital home, which was to be transferred to the wife as part of the divorce. She wanted to have a separate agreement that the home was hers alone.
The husband claimed the parties’ agreement was contractual in nature and not modifiable except by agreement of the parties. He argued that the designation of the house as wife’s property was to serve as the basis for his equalization payment, and that the the ex-wife’s inheritance should be ignored for purposes of recalculation of the equalization payment.
Wife argued that in signing the Agreement, there was no provision for imposing a tax liability. Wife argued that the tax liability would not have been determined until after the date of the divorce. The equalization payment would be payable only after the tax liability was resolved. Her lawyer failed to add a sentence to the agreement that no portion of the wife’s inheritance would be considered for purposes of determining the equalization payment.
The trial judge found in favor of the wife, citing the guiding principle of Illinois Family Law: "a court may enter a judgment of dissolution of marriage only after it makes provisions to the court’s satisfaction for financial matters.
The appellate court affirmed the decision. In affirming, the reviewing court held "We cannot now find, as the husband urges, that the conduct of the parties at the time they entered into the agreement so expressed their intent that the wife’s inheritance was included among the marital assets for purposes of the equalization payment .
Case study #2: A combined case
In this case, there are three related divorce and child-related agreements. The first was an agreement that addressed post-majority support. The second was an agreement in response to a Petition for Modification of Child Support. The third was a qualified domestic relations order (QDRO) for division of a pension.
In this case, both parties agreed to be bound forever by an agreement not to seek post-divorce support, except for the right to seek tuition or daycare expenses for the children, who were both under two at the time. Husband’s income was high, and he was "able to seek additional employment to pay tuition, if so required." The wife had an MBA, but gave up her career in marketing to care for the children full-time. Both parties had good parental instincts when it came to their children until the point of divorce.
After two years, the wife applied for enrollment in a doctoral program at the same school where the children were enrolled in daycare. The wife wanted husband to pay half of the child care costs incurred as a result of her enrollment. In response to the petition, the court ultimately ordered a change in the schedule but did not order husband to pay half the cost of the childcare program.
The court also entered a QDRO, divvying up the husband’s pension. The husband appealed.
When a motion is made to modify provisions contained in prior judgment regarding child support, the court must find that there has been an adverse change in circumstances. A review of the case law provides guidance as to what constitutes an adverse change in circumstances. "The annual increase or reduction in defendant’s income does not constitute an adverse change in circumstances."
The appellate court had only one issue to review on appeal, whether the trial court’s modification of the prior provision setting forth stipulated child support was supported by the evidence. Under the law, the appellate court was required to determine whether there was evidence upon which the trial court could reasonably find that there had been an adverse change in circumstances.
The appellate court affirmed the decision of the trial court.
