In J.B. v. W.B., the court ruled that a Property Settlement Agreement can be modified for setting up a special-needs trust for a disabled child’s support.
Opinion by Judge Cuff, P.J.A.D. (temporarily assigned).
By David Wildstein, Family Lawyer
Issue 1: Under what circumstances can a party seek a modification of a Property Settlement Agreement to create a special-needs trust for the benefit of an unemancipated adult disabled child of the marriage?
Holding 1: A parent seeking to modify a Property Settlement Agreement to create a special-needs trust for the support of a disabled child must present a specific plan outlining its purpose and demonstrate how the proposed trust will benefit the disabled child.
The court noted that at a minimum, the trial judge should be provided with a thorough explanation of the trust and its intent so that the judge has a complete understanding of the current physical, psychological, educational, and recreational needs of the dependent disabled child; the costs to support those needs; and the resources available. The court further explained that if the plan relies upon government benefits, the party must explain how the trust will use those benefits. The plaintiff stated that his request for a special-needs trust at this time was so that his money would be in trust for the child while the child received governmental benefits that he qualifies for and needs. The Father asserted that the child is truly being benefitted by the trust because the child would have the benefit of the child support paid into the trust and the receipt of means-tested benefits. The court found this argument disingenuous and self-serving.
Issue 2: Did the Court err in not appointing a guardian ad litem for the dependent and unemancipated adult child of the marriage?
Holding 2: No. There is no rule or statute that addresses whether a guardian ad litem for the adult unemancipated disabled child should be appointed. The court noted that the basic role of a guardian ad litem is to address the best interest of a minor child. The decision to appoint a guardian ad litem for a child is within the discretion of the judge. Here, because the Father failed to present a comprehensive plan, the trial judge did not mistakenly exercise discretion. However, should the parents submit a detailed plan proposing the trust, the trial court should consider the appointment of a guardian ad litem or other resource person.
Issue 3: What are the requirements of a special-needs trust?
Holding 3: A. The state must receive all amounts remaining in the trust upon the death of the beneficiary up to the total medical assistance paid on behalf of an individual. B. The trust must specifically state that the trust is for the sole benefit of the trust beneficiary. C. The trust must be irrevocable. D. The trust must state that its purpose is to permit the use of trust assets to supplement and not supplant, impair, or diminish any benefits or assistance from the Federal, State, or other governmental agency for which the beneficiary may otherwise be eligible or which the beneficiary may be receiving.
David Wildstein practices family law with the New Jersey law firm of Wilentz, Goldman & Spitzer.