453 A.2d 527 (N.J. 1982)
Melvin Mahoney and June Lee Mahoney married in Indiana in 1971. At the time of their marriage, Melvin possessed an engineering degree while June Lee held a bachelor of science degree.1 From the time of their marriage until their separation in October 1978, the parties generally shared all household expenses.2
Between September 1975 and January 1977, Melvin attended the Wharton School of the University of Pennsylvania and received an M.B.A. degree.3 During this sixteen-month period, June Lee contributed about $24,000 to the household while Melvin made no financial contribution.4 Melvin's educational expenses of about $6,500 were paid by veterans' benefits and a payment from the Air Force.5 After receiving his degree, Melvin went to work as a commercial lending officer for Chase Manhattan Bank.6
In 1976, June Lee began a part-time graduate program at Rutgers University that led to a master’s degree in microbiology one year after the parties separated.7 Her employer paid for the program, and she worked full time throughout her graduate schooling.8 In March 1979, Melvin sued for divorce and June Lee filed a counterclaim also seeking a divorce.9 The trial court granted dual judgments of divorce in May 1980 on the ground of eighteen months continuous separation.10
At the time of trial, Melvin’s annual income was $25,600 and June Lee’s income was $21,000.11 The parties owned no real property and divided their personal property by agreement.12 The only issue at trial was June Lee’s claim for reimbursement of the support she gave Melvin while he obtained his M.B.A. degree.13 The trial court ordered Melvin to reimburse his wife in the amount of $5,000, to be paid at the rate of $100 per month.14 The Appellate Division reversed the award.15 The Supreme Court granted certification in 1982.16
Whether the plaintiff’s M.B.A. degree earned during the marriage constitutes “property” for purposes of N.J.S.A. 2A:34-23?17
The word property in N.J.S.A. 2A:34-23 receives an expansive interpretation, yet a professional degree lacks the attributes of property because it has no exchange value, is personal to the holder, cannot be transferred or assigned, terminates on death, and represents only speculative future earning capacity, as established in Stern v. Stern where earning capacity is not recognized as a separate item of property.18
No. Applying the rule to the facts, Melvin obtained his M.B.A. degree from the Wharton School during the marriage with June Lee's household support of about $24,000, yet the degree remains a personal intellectual achievement that cannot be sold or pledged and whose value depends on uncertain future events such as his employment at Chase Manhattan Bank.19
This contrasts with assets like the vested pensions in Kikkert v. Kikkert that entitle the owner to a definite amount at a specific future date.20
The M.B.A. degree is not property subject to equitable distribution under N.J.S.A. 2A:34-23.21
Whether the defendant can recover the money she contributed to her husband’s support while he pursued his professional education?22
Although a professional degree is not property, reimbursement alimony is available when one spouse makes financial contributions to the other spouse's professional education with the mutual expectation that both will derive increased income and material benefits, allowing recovery of all such contributions including household expenses to avoid unfairness upon divorce.23
Yes. Applying the rule to the facts, June Lee contributed about $24,000 to the household during the sixteen-month period while Melvin pursued his M.B.A. at Wharton with the shared expectation of future benefits from his enhanced earning capacity, and the subsequent divorce defeated that expectation without any offsetting marital assets, warranting reimbursement alimony on remand.24
The defendant may recover reimbursement alimony for her contributions, and the matter is remanded for determination of the appropriate amount.25