Obligation to Pay Child Support Not Eliminated for Creation of Special Needs Trust (SNT) (N.J. App.)

The appeal addressed the issue of whether the creation of a special needs trust can justify the elimination of the obligation to pay child support to the primary residential parent of a special needs child. The appellate court concluded that while a party may utilize a special needs trust to take advantage of government programs to lessen the burden on the parent to provide support and medical assistance, the facts of the case did not support a concurrent application to eliminate child support. The court denied the ex-husband’s request to eliminate child support payable to the defendant and to establish a special needs trust for the educational and living expenses of the parties’ autistic son. The parties had entered into a property settlement agreement (PSA) relevant to their divorce which had child support provisions and acknowledged the future needs of their son.

The court held that, despite the purpose of the special needs trust (entitlement to governmental benefits for the son), plaintiff had entered into the PSA with a full understanding of his son’s needs and with the further understanding that his day-to-day needs would be provided by defendant through child support. The amount struck by the parties of $50,000 per year in child support reflected that understanding. Moreover, plaintiff, who was very financially sound, understood that he would remain responsible for the cost of the son’s special education as well as the retention of a large life insurance policy. The parties could have established a special needs trust in the PSA but chose not to. The facts and circumstances had not been altered such that there were changed circumstances sufficient to warrant a finding that the PSA was unfair and unjust.

Bond v. Bond*, Unpub. Opinion, N.J. Super., A.D., 2011 WL 6412137 (December 22, 2011)

*A copy of the full case can be obtained with the permission of the Superior Court of New Jersey, Appellate Division.