Who is the obligor and who is the obligee?

As the name suggests, there is a contractual obligation between an Obligor and Obligee. While the terms can be used in more than one type of legal agreement, it’s most commonly used for custody agreements. The two parties share one or more dependents, and they work together to support those dependents. The Obligor is the person who is bound to perform some legal obligation, and the Obligee is the person who benefits from the performance.

In a financial industry context, the term Obligor means a payment bonds issuer who is contractually bound to make all principal repayments and interest payments on outstanding debt. The recipient of the payment is called an Obligee. This applies to all sorts of commercial bonds and more.

In a construction contract, the two parties involved are called an Obligee and a Principal or a Principal and a Subtrade. The most common types of bonds offered by construction companies are bid bonds (or surety bonds) to show a commitment to honor the terms of the bid (both in time and cost). Periodically, a Surety may be presented with a request to add an additional Obligee to the bond. The additional Obligee is not a party to the contract and does not perform the Primary Obligee’s obligations, but it is common practice for a Surety to issue a Dual/Multiple Obligee Rider. In a surety bond, the Obligee is the one requiring the Principal to post the surety bond. They need the surety bonds to transfer the risks of the Principal’s performance from themselves to the surety carrier.

Much more frequently, the Obligor is called the debtor and the Obligee is called the creditor. The specific terms obligor and obligee are mostly used in a family law context to refer to the child support relationship between divorced parents.

If you’re involved in a divorce or in a child support determination, having an experienced family law attorney can make a huge difference. You can begin your search for a nearby divorce attorney by entering your ZIP code into our search tool right now.

How Long Does the Obligor Obligee Relationship Last?

The obligor is the parent that is required to pay the child support to the other parent, and the obligee, or obliged, is the parent who receives the payment.

As a general rule, once a child support amount has accrued, the Obligor is required to pay that amount, regardless of circumstances. For example, if the Obligor is required by the courts to pay $500 each month, he or she will owe $1,500 if they do not seek modification and fail to make their monthly obligation for three months. Even if the Obligor loses their job, the $1,500 remains due and cannot be discharged in bankruptcy like other civil judgments.

Falling behind on child support payments can lead to problems such as wage garnishment , loss of driver’s licenses, and other divorce law problems. Therefore, it is important that an Obligor parent pay what is owed, and make an effort to change child support amounts when there is a change in income of either parent.

If the Obligor or Obligee experience a change in financial status or income, either party may petition the court to change the amount of the monthly child support. Generally, the courts require payment until the child is 18 or has graduated high school. In cases of severe disability or in other circumstances, the court may require ongoing responsibility.

When Does a Child Support Debt Obligation Change?

One of the most important things to realize in a family law context is child support is always subject to change. Many parents are frustrated by the term “final orders” because they never seem to be final. Each time Obligors gets a significant pay raise, they can be taken back to court by the Obligee and ordered to pay a new child support amount based on their new income level.

Similarly, if Obligors are laid off or experience a salary cut, they can petition the court for a reduction in their child support obligation, leaving the Obligee with a lower payment each month.

The same is true of the income for an Obligee parent. If the Obligee’s income increases, the Obligor parent can file a motion requesting that child support be recalculated. If the Obligee’s income decreases, such as by the loss of a job, the Obligee may ask the court to increase child support to make up for lost income. The goal is to provide a stable amount of support for the dependents in the agreement through a formal monetary obligation.

If the Obligor parent does not respect the agreement and fails to pay child support as ordered by the court, the Obligee may file a motion to enforce the financial obligation. Additionally, in some states, a child who has turned eighteen years of age may sue to recoup back child support from a delinquent parent.

Child support arrearages are never removed from a parent’s record. In fact, if Obligors fail to pay child support for a lifetime, the arrearage may be taken from any their assets or through wage garnishment. In short, once child support is ordered, the Obligor parent expected to pay even if the Obligee does not go to court to enforce it.

Case Studies: Understanding the Roles of the Obligor and Obligee

Case Study 1: Anderson Family Custody Dispute

In the Anderson family, after a difficult divorce, the court established John Anderson as the Obligor and Sarah Anderson as the Obligee in their child support agreement. However, John lost his job a few months later, and he struggled to keep up with the monthly child support payments.

Feeling overwhelmed, John sought legal assistance from Attorney Emily Parker to request a modification of the child support amount based on his current financial situation. Attorney Parker guided John through the process, ensuring that his rights were protected and that the court considered his genuine inability to meet the original payment obligation.

Case Study 2: Thompson Construction Surety Bonds

Thompson Construction Company was undertaking a major infrastructure project, and they were required to obtain surety bonds to ensure the completion of the project as per the contract. The Obligor in this case was Thompson Construction Company, while the Obligee was the government agency overseeing the project.

To navigate the complex world of surety bonds and fulfill their contractual obligations, Thompson Construction Company sought legal advice from Attorney Michael Roberts. Attorney Roberts helped the company understand the obligations they needed to fulfill and assisted in obtaining the necessary surety bonds to satisfy the Obligee’s requirements.

Case Study 3: Ramirez Divorce Child Support Agreement

In the Ramirez divorce, Sarah Ramirez became the Obligee, and Mark Ramirez the Obligor in the child support agreement for their two children. Several years after the divorce, Sarah’s income significantly increased due to a job promotion. Mark felt it was unfair that he was still paying the same amount in child support, considering the change in Sarah’s financial circumstances.

He approached Attorney Jessica Hernandez to request a modification of the child support order. Attorney Hernandez assisted Mark in presenting evidence of Sarah’s increased income to the court, resulting in a revised child support amount that reflected both parents’ current financial capabilities.

Bringing it all together

An Obligor is a debtor, the parent who is required to pay child support, or the party ordering individual surety bonds or other bonds. An Obligee is a creditor, the parent who collects child support, or the party requesting a surety bond in an insurance context.

Even though a divorce is granted with a final order, that order can be modified if the financial situation of the obligor or obligee changes significantly. The obligation to pay child support, however, is one that cannot be discharged. Even if the obligor declares bankruptcy, the debt for child support will not be extinguished.

If you are going through a divorce or seeking a modification of your child support, this is strictly for informational purposes. Enter your ZIP code into our search tool to find experienced family law attorneys near you right now.