Posted by Nydia Streets of Streets Law in Florida Divorce
Would a spouse be responsible for paying back the other spouse’s student loans in a Florida divorce? Many parties question this, because the thought is that the spouse earning the degree will continue to benefit from it to the exclusion of the other spouse well after the divorce. So why should the the non-degree-earning spouse have to pay for the loans that supported the degree? The recent case Gudur v. Gudur, 2D16-3127 (Fla. 2d DCA June 28, 2019) goes over this issue.
The parties were married for over 14 years by the time of their divorce. The former wife was a doctor and the former husband was a lawyer. By the time of trial, the former husband was unemployed. The trial court distributed assets and debts which included the former wife’s share of her medical practice and the former husband’s student loan debt. The former husband was awarded alimony of $5,000 per month for seven years. The former husband appealed.
On the issue of the division of the former wife’s ownership interest in her medical practice, the former husband argued the trial court abused its discretion in that it allowed the former wife to indefinitely hold out on paying him his equitable distribution share. The trial court determined the former husband was owed $190,000, but did not require the former wife to pay him at any specific time. The appellate court reversed this decision, holding, “The Former Wife has 401(k) accounts totaling over $200,000 and a substantial net income of over $17,000 per month. Under these circumstances, we determine that it is patently unreasonable and an abuse of discretion to leave the payment of the $190,000 awarded to the Former Husband to an indefinite date in the future. Therefore, we reverse the equitable distribution and remand for reconsideration after the trial court refashions the distribution of this asset. Distribution of this asset could be accomplished by methods such as restructuring the equitable distribution to immediately pay the Former Husband, [. . .] or establishing a payment plan for the Former Wife to pay the award within a reasonable time, including the consideration of statutory interest on the unpaid balance.”
On the issue of the former husband’s student loans, the trial court held, “The Husband is being distributed all of his student loan debt because, although approximately $72,259.00 was incurred during the marriage, the benefit of the student loans inured entirely to the Husband and the expense is not one that benefited the marriage or fulfilled a marital purpose given the Husband's few years practicing law and his failure to complete his doctoral studies.” On appeal, the court reversed the trial court’s ruling, holding, “The trial court erred because "[t]he fact that one party will not receive any benefit from the other party's education because of the dissolution is not a factor to be considered when allocating a marital debt for student loans." Rogers v. Rogers, 12 So. 3d 288, 291 (Fla. 2d DCA 2009); see also Cooley v. Cooley 253 So. 3d 1223, 1228 (Fla. 2d DCA 2018) (reversing equitable distribution where the wife was "saddled with all the marital student loan" debt when the trial court had found that the husband would not benefit from the wife's education).”
Finally with regard to alimony, although the appellate court found there was no abuse of discretion in awarding only durational alimony, since the equitable distribution was being revisited, the trial court was instructed to reconsider the alimony award in light of the new equitable distribution scheme. If you are facing similar issues in your Florida divorce case, do not wait until it is time to appeal to address them - hire a Miami divorce lawyer from the outset to give yourself the best chance of success in resolving your case.