Family Law Flash Points - November 2019

3.         Trial court’s order awarding wife $60,000 in lost equity of former marital residence reversed.  In a second appeal of this case, the issue on appeal was whether the trial court exceeded its authority under the Appellate Court’s mandate concerning the marital residence.  At the original trial, the parties agreed there was $100,000 of equity in the marital residence. The trial court ordered the property sold with the proceeds split 60/40 to wife, but the court was never informed by husband at trial that foreclosure proceedings had been initiated against the property for his failure to pay the mortgage and taxes.  Eventually the foreclosure was perfected causing a complete loss of any equity.  On the first appeal, the Court vacated the trial court’s contempt finding against husband because he could not purge himself of the contempt because he could not list the property for sale since it had already been foreclosed upon.  On remand, the trial court ordered husband to pay the wife $60,000 which was 60% of the lost equity in the residence as a result of the foreclosure.  The Appellate Court again reversed in this appeal because the value of the property could not have been $100,000 at trial because of the foreclosure.  Therefore, it was error to award wife $60,000.  Essentially, the trial court’s contempt power was non-existent to enforce its judgment regarding the residence because there was never any value to the residence.  However, the Court noted that on remand the trial court has several equitable powers available to it and instructed the court to consider wife’s motion to modify which was still pending wherein she requested maintenance for the lost equity in the marital residence.  In re Marriage of Jones, 2019 IL App (5th) 180388.

4.         Contribution to and allocation of Section 513 expenses in Marital Settlement Agreement (MSA) upheld.  Husband sought several avenues to reduce his obligation to contribute to his children’s 529 college savings accounts despite the fact the MSA provided the parties would pay for their children’s college expenses.  Further, the MSA ordered husband to pay $79,301.44 into the childrens’ 529 plans, such amount representing a support arrearage husband owed wife at the time of judgment.  Within a year of the entry of judgment, husband filed a petition to vacate the judgment which was denied.  He then filed a petition for voluntary bankruptcy.  Wife prevailed on seeking a finding that the $79,301.44 was a domestic support obligation and non-dischargeable in bankruptcy.  Husband later filed a petition to modify support when the oldest child emancipated and also sought an order that he had no obligation to contribute to his college expenses which was denied. Husband was ordered to contribute 40% to the child’s college education and the court declined to modify his obligation to contribute the support arrearage to the 529 plans. Husband appealed and the Appellate Court affirmed.  It is well-established the parties to a divorce action may voluntarily settle their property interests and that is exactly what the parties did with the provision regarding the payment of the debt owed to wife for support.  The language of the agreement also did not state that husband’s repayment of such marital debt would reduce his future college contribution obligation, and had they intended such a reduction they would have said so.  The Court also opined in dicta that husband’s argument that the bankruptcy court’s classification of the arrearage as a domestic support obligation immediately made the debt modifiable had no legal support whatsoever.  In re Marriage of Wilhelmsen, 2019 IL App (2d) 180898.