In re Marriage of Charles ( 1996 )


Menu:
  •                              NO. 4-95-0813

      

                             IN THE APPELLATE COURT

      

                                   OF ILLINOIS

      

                                 FOURTH DISTRICT

      

    In Re:  the Marriage of                 )    Appeal from

    MARYSE CHARLES,                         )    Circuit Court of

             Petitioner-Appellant,         )    Macon County

             and                           )    No. 92D153

    FRANTZ CHARLES,                         )    

             Respondent-Appellee.          )    Honorable

                                           )    Scott B. Diamond,

                                           )    Judge Presiding.

    _________________________________________________________________

      

      

             JUSTICE McCULLOUGH delivered the opinion of the court:

      

             In March 1994, the trial court entered a judgment

    dissolving the 19-year marriage of petitioner, Maryse Charles, and

    respondent, Frantz Charles, and reserving all other issues.  In

    December 1994, the court entered a supplemental judgment, allocat-

    ing marital assets and debts and ordering Frantz to pay $2,250 per

    month in child support.  In September 1995, the court entered a

    judgment which, in relevant part, awarded Maryse $2,750 per month

    in maintenance, reviewable after three years.

             Maryse appeals, arguing that the trial court erred (1) in

    allocating marital assets and debts because the court (a) did not

    consider Frantz's dissipation of marital assets, (b) did not

    consider the parties' grossly disparate earning abilities; and (c)

    ordered that liquidated marital assets be used to pay Frantz's 1994

    tax liability; (2) by ordering that liquidated marital assets be

    used to satisfy Frantz's attorney fees; (3) in awarding child

    support that was substantially below the statutory guidelines; and

    (4) in awarding maintenance that is inadequate to enable Maryse to

    enjoy a lifestyle consistent with the lifestyle she had enjoyed

    during the marriage.  We reverse and remand.

             Preliminarily, we point out that Frantz did not file a

    brief on appeal.  In First Capitol Mortgage Corp. v. Talandis

    Construction Corp., 63 Ill. 2d 128, 133, 345 N.E.2d 493, 495

    (1976), the supreme court held that where the record is simple and

    the claimed errors are such that the reviewing court can easily

    decide them without the aid of the appellee's brief, the court

    should decide the merits of the appeal.  However, a reviewing court

    should not be compelled to serve as appellee's advocate.  Where the

    issues on appeal cannot be easily evaluated, the appellant's brief

    makes a prima facie showing of reversible error, and the record

    supports the allegations of error, a reviewing court may reverse.

    Talandis, 63 Ill. 2d at 133, 345 N.E.2d at 495.

             Deference should be given to the work of the trial judge,

    and in the interest of judicial economy we are reluctant to reverse

    without giving consideration to the merits.  See Daley v. Jack's

    Tivoli Liquor Lounge, Inc., 118 Ill. App. 2d 264, 273-75, 254

    N.E.2d 814, 818-19 (1969) (cited as instructive in Talandis, 63

    Ill. 2d at 131, 345 N.E.2d at 494).  The record in this case is not

    so complicated as to prevent this court from reviewing the issues

    on the merits.  We will consider the merits of the appeal.

             Only those facts necessary to an understanding of this

    disposition will be discussed.  As to the issues raised on appeal,

    the standard of review is whether the trial court's findings of

    fact are against the manifest weight of the evidence or whether the

    property distribution or awards of maintenance, child support, and

    attorney fees amounted to an abuse of discretion.  In re Marriage

    of Swanson, 275 Ill. App. 3d 519, 528, 656 N.E.2d 215, 222 (1995)

    (property distribution); In re Marriage of Frey, 258 Ill. App. 3d

    442, 448, 630 N.E.2d 466, 471 (1994) (property distribution

    including dissipation of assets); In re Marriage of Parker, 252

    Ill. App. 3d 1015, 1022, 625 N.E.2d 237, 242 (1993) (attorney

    fees); In re Marriage of Harlow, 251 Ill. App. 3d 152, 156, 621

    N.E.2d 929, 933 (1993) (maintenance); In re Marriage of Tietz, 238

    Ill. App. 3d 965, 978, 605 N.E.2d 670, 680 (1992) (child support).

             The first issue is whether the trial court's allocation

    of marital assets and debts was an abuse of discretion because the

    trial court did not appropriately consider Frantz's dissipation of

    marital assets.  Maryse filed a petition for legal separation on

    June 4, 1991.  An order was entered on July 29, 1991, granting her

    temporary custody, child support, maintenance, and use and

    possession of the marital residence and a 1990 Audi.  She filed a

    petition for dissolution of marriage on March 6, 1992.  At that

    time, the proceedings were consolidated.  

             The trial court first ordered that marital debts be

    satisfied from the marital estate.  These debts ($344,476.42 plus

    any penalty from the early withdrawal of tax-sheltered investments)

    included several years of tax liabilities, Frantz's 1994 estimated

    Federal income tax, and payments of attorney fees for both parties.

    After debt satisfaction, the trial court awarded Maryse $49,000 in

    personal property she had taken to Florida.  Frantz was awarded two

    homes and the debts thereon, a 1991 Nissan Pathfinder and the debt

    thereon, and his medical practice.  The trial court's orders

    contain no findings as to the values of the assets awarded to

    Frantz.  

             Maryse's first issue concerns dissipation of marital

    assets by Frantz.  Dissipation is a factor the trial court should

    consider in allocating marital property.  In re Marriage of Lee,

    246 Ill. App. 3d 628, 633, 615 N.E.2d 1314, 1319 (1993).  Dissipa-

    tion refers to the "'use of marital property for the sole benefit

    of one of the spouses for a purpose unrelated to the marriage at a

    time that the marriage is undergoing an irreconcilable breakdown.'"

    In re Marriage of O'Neill, 138 Ill. 2d 487, 497, 563 N.E.2d 494,

    498-99 (1990), quoting In re Marriage of Petrovich, 154 Ill. App.

    3d 881, 886, 507 N.E.2d 207, 210 (1987).  Whether a given course of

    conduct constitutes dissipation within the meaning of the Illinois

    Marriage and Dissolution of Marriage Act (Act) (750 ILCS

    5/503(d)(2) (West 1992)) depends upon the facts of the particular

    case.  Lee, 246 Ill. App. 3d at 633, 615 N.E.2d at 1319.  The

    spouse charged with dissipation has the burden of proving, by clear

    and convincing evidence, how the marital funds were spent.  Based

    on the credibility of the witnesses, the trial court determines

    whether the funds were spent for legitimate family expenses which

    were necessary and appropriate.  Tietz, 238 Ill. App. 3d at 983-84,

    605 N.E.2d at 683.

             The orders of the trial court in this case do not address

    the question of dissipation of assets.  No finding was made

    regarding whether there was dissipation.  Nor do the trial court's

    orders indicate when the marriage began undergoing an irreconcil-

    able breakdown.  Maryse argues this began when Frantz began his

    extramarital relationship.  The record indicates that Frantz gave

    money to and purchased trips and other items for his mistress

    beginning in September 1990 and continuing for some time during

    these proceedings.  This was acknowledged by Frantz.  There was

    testimony from certified public accountant Robert Disbrow and from

    Frantz from which the trial court could find that Frantz spent

    several tens of thousands of dollars on this woman, including

    credit card payments, cash, a house down payment, and mortgage pay-

    ments.  He was also paying her child support for their child.

    Maryse points to evidence showing Frantz spent in excess of

    $116,000 with respect to the extramarital relationship.  Frantz

    purchased a second home for himself after the parties separated.

    For this second home, he made a downpayment of $11,000 and secured

    a $175,000 mortgage.  From April 1993 through November 1993, he

    made monthly mortgage payments of $1,500.  He also purchased

    furniture for himself.  While Maryse testified that Frantz had

    removed several valuable household items from the marital home when

    the parties initially separated, there was no evidence of the value

    of these assets.  Nor was there evidence of the value of the

    personal property Maryse sold to pay for her move to Florida.  

             In In re Marriage of Hagshenas, 234 Ill. App. 3d 178,

    197, 600 N.E.2d 437, 451 (1992), the court addressed the issue of

    dissipation through excessive expenditures for living expenses, and

    wrote the following:

             "It is entirely within the realm of possibil-

             ity that one spouse's use of marital funds for

             his or her own living expenses at a time when

             the marriage is undergoing an irreconcilable

             breakdown could be shown to be so selfish and

             excessive and improper as to constitute an

             outright waste of marital funds."

    On the record before us, there was dissipation of marital assets by

    Frantz.  Furthermore, between May 1991 and April 1993, the evidence

    shows Frantz liquidated investments.  Maryse argues this amount

    exceeds $210,000.  As the party charged with dissipation, Frantz

    had the burden to establish by clear and convincing evidence the

    disposition of these funds.  The failure of the trial court to

    address the question of dissipation amounted to an abuse of

    discretion requiring reversal.

             The record also supports a finding that Frantz dissipated

    marital funds when he failed to satisfy the 1991 tax debt, thereby

    incurring over $26,000 interest and penalties.  Although the 1991

    Federal income tax return was filed jointly, Maryse testified that

    Frantz controlled the family finances and she did not see the 1991

    tax return before Frantz filed it.  Frantz presented no evidence

    that Maryse had seen or signed the return, nor did he offer a

    reason for failing to satisfy the tax debt.  In addition, the trial

    court could find that Frantz dissipated marital funds relating to

    the filing of income tax returns for 1992 and 1993.

             Upon remand, the trial court should reconsider the

    distribution of marital assets and liabilities in light of the

    dissipation of marital assets by Frantz.  Because this judgment is

    reversed, the remaining issues will be discussed to provide further

    guidance to the trial court on remand.  

             When Maryse and Frantz married in 1974, Maryse abandoned

    her medical studies.  Although she subsequently acquired a

    bachelor's degree in chemistry in 1993, she had not work outside

    the home for a number of years and remained the primary caregiver

    for their two children.  During their marriage, Frantz established

    a profitable medical practice.  During the first six months of

    1995, his net business income was $116,577.  There is evidence

    Frantz has substantial future earning ability.  The trial court

    committed an abuse of discretion by awarding Frantz, after debt

    satisfaction, the bulk of the marital assets.  It is likely Frantz

    will be awarded the medical practice.  The trial court should award

    Maryse other marital property as an offset or order Frantz to make

    payments to her.  See Tietz, 238 Ill. App. 3d at 969-70, 605 N.E.2d

    at 674; In re Marriage of Scafuri, 203 Ill. App. 3d 385, 389, 561

    N.E.2d 402, 405 (1990).

             At the August 21, 1995, hearing, the trial judge

    explained that it appeared to him the parties had more debts than

    assets, and although the medical practice was a high income

    producer, he was going to consider the debt-asset relationship in

    the award of maintenance.  Courts have observed that, after a

    dissolution of marriage, there may not be sufficient funds to

    maintain both parties in the standard of living they previously

    enjoyed.  However, one party should not be allowed to continue in

    that standard of living while the other party is forced to

    substantially reduce her standard of living.  This principle

    applies whether the court is considering property distribution,

    dissipation of assets, or maintenance.

             In reconsidering the distribution of marital property on

    remand, the trial court must also consider the parties' grossly

    disparate earning abilities in determining an equitable distribu-

    tion.  Section 503(d) of the Act sets forth the factors to be used

    by the trial court to divide the marital property in just propor-

    tions.  750 ILCS 5/503(d) (West 1992).  When it is necessary to

    award large or income-producing assets to one spouse, the court may

    achieve an equitable distribution by authorizing off-setting

    payments to the other spouse.  Swanson, 275 Ill. App. 3d at 528,

    656 N.E.2d at 222.

             It also appears the trial court erred in allocating

    marital assets and debts because the court ordered that marital

    assets be used to satisfy Frantz's estimated 1994 tax liability of

    $108,321, even though the court entered the dissolution judgment in

    March 1994.  Since the parties' marriage was dissolved in March

    1994, it is clear that a portion of Frantz's income for 1994 is

    marital property which must be considered in the distribution of

    marital assets.  Since no final judgment of legal separation was

    entered in this case, section 503(a)(3) of the Act is not invoked.

    750 ILCS 5/503(a)(3) (West 1992).  However, the tax liability on

    only that portion of Frantz's 1994 income which was earned prior to

    the dissolution of marriage is a marital liability.  The fact that

    the parties were living separately does not change the marital

    nature of the income of either party, nor does it change the

    marital nature of the income tax liability on that income, although

    the incurring of penalties and interest by one party may be deemed

    dissipation of assets.  On remand, the trial court must make a

    determination as to how much of Frantz's 1994 income, and there-

    fore, how much of the 1994 tax liability, is included in the

    marital estate and may allocate these assets and liabilities to the

    parties.

             The trial court ordered that marital assets be used to

    satisfy Maryse's 1994 income tax liability.  Her income consisted

    only of the maintenance she received during 1994, which did not

    represent the acquisition of a separate marital asset.  The

    Internal Revenue Code of 1939 allows one spouse to deduct payments

    of separate maintenance to the extent those payments are includable

    in the gross income of the recipient spouse, provided a joint

    return is not filed.  See 26 U.S.C. §§71, 215 (1994).  However,

    this does not control the determination of whether the income is a

    marital asset or the resultant liability is a marital liability

    under state law.  It would not be an abuse of discretion for the

    trial court to order each party to pay his or her own income tax

    liability after separation in light of the disparity in income to

    each.  Nor would it be an abuse of discretion to have the liabili-

    ties paid from the marital estate to the extent the incomes of each

    party are substantially equivalent.  However, when the income and

    tax liability of one party far exceeds the income and tax liability

    of the other party, it may be an abuse of discretion to order

    payment of both parties' income taxes out of the marital funds

    because this inadvertently penalizes the party with the lower

    income.  Here, the parties should have been ordered to pay his or

    her own 1994 federal income tax liability.

             Concerning attorney fees, the trial court erred by

    ordering that liquidated marital assets be used to pay Frantz's

    attorney fees.  This, in effect, required that Maryse contribute to

    Frantz's attorney fees.  Under section 508(a)(1) of the Act, the

    trial court may order a party to pay all or part of the other

    party's attorney fees and costs incurred in maintaining an action

    under the Act.  750 ILCS 5/508(a)(1) (West 1992).  However, the

    party seeking attorney fees must show an inability to pay the fees

    and an ability of the other spouse to pay the fees.  In re Marriage

    of Riech, 208 Ill. App. 3d 301, 312, 566 N.E.2d 826, 832 (1991).

             The record does establish that Frantz is able to pay his

    attorney fees.

             As to the award of child support, section 505(a) of the

    Act (750 ILCS 5/505(a) (West 1992)) creates a rebuttable pre-

    sumption that a specified percentage of a noncustodial parent's

    income represents an appropriate child support award.  In re

    Marriage of Freesen, 275 Ill. App. 3d 97, 105, 655 N.E.2d 1144,

    1150 (1995).  Section 505(a)(1) of the Act provides that, in the

    case of two children, the minimum amount of child support which the

    trial court should order is 25% of the noncustodial parent's net

    income.  750 ILCS 5/505(a)(1) (West 1992).  The court may award

    less child support if, after considering all relevant statutory

    factors, it finds a reason for deviating from the guidelines.  750

    ILCS 5/505(a)(2) (West 1992).  When determining whether to deviate

    from the statutory guidelines, a trial court's consideration of the

    factors set forth in section 505 of the Act is mandatory, not

    directory.  Freesen, 275 Ill. App. 3d at 105, 655 N.E.2d at 1150.

    In addition, the trial court must make express findings when it

    orders child support that is below the statutory minimum.  In re

    Marriage of Morgan, 219 Ill. App. 3d 973, 974, 579 N.E.2d 1214,

    1215 (1991).  In determining the child support obligation of a

    high-income parent, the court must balance competing concerns.

    Lee, 246 Ill. App. 3d at 643, 615 N.E.2d at 1326.  On one hand,

    child support awards are not intended to be windfalls.  Lee, 246

    Ill. App. 3d at 644, 615 N.E.2d at 1326.  On the other hand, the

    court must consider the standard of living the children would have

    enjoyed absent parental separation and dissolution.  Lee, 246 Ill.

    App. 3d at 643-44, 615 N.E.2d at 1326.

             During the parties' marriage, the children enjoyed an

    affluent lifestyle, including trips, parochial school, piano

    lessons, and restaurant meals.  In awarding child support in this

    case, the trial court specifically found that Frantz is financially

    able to pay child support, but failed to give any reason for its

    downward deviation from the statutory guidelines.  The failure to

    explain the deviation alone warrants reversal.  

             For the purpose of calculating child support, the

    supporting parent's net income, as defined in section 505(a)(3) of

    the Act, must be calculated.  750 ILCS 5/505(a)(3) (West 1992).

    Although, in calculating net income, federal and state income taxes

    are deducted, we conclude the penalties and interest incurred for

    the late and nonpayment of such taxes are not deductible in

    arriving at a supporting parent's net income under the Act.  The

    record does show that Frantz is financially able to pay child

    support (in 1992, Frantz earned $225,820; in 1993, more than

    $258,000; and in 1994, more than $292,000).

             Prior to the trial court in this case setting the child

    support award, all of the factors enumerated in section 505(a)(3)

    of the Act should be considered in determining net income.

             Finally, we consider whether the trial court committed an

    abuse of discretion by awarding Maryse $2,750 per month in mainte-

    nance reviewable after three years.  Once a trial court determines

    that a maintenance award is appropriate under section 504(a) of the

    Act, the court must consider relevant statutory factors to

    determine the amount and duration of the award.  750 ILCS 5/504(a)

    (West 1992).  Those factors include the resources of the party

    seeking maintenance (including apportioned marital property), the

    standard of living established during the marriage and its

    duration, and the financial ability of the party from whom

    maintenance is being sought to meet his needs as well as meeting

    those of his former spouse.  750 ILCS 5/504(a) (West 1992).  

             In determining the amount and duration of maintenance,

    the trial court must balance the realistic ability of the spouse to

    support herself in some approximation of the standard of living

    enjoyed during their marriage against a goal of financial inde-

    pendence.  Harlow, 251 Ill. App. 3d at 158, 621 N.E.2d at 934.  In

    addition, when former spouses have grossly disparate earning

    potentials, the goal of financial independence may not be achiev-

    able because of the dependent former spouse's inability to maintain

    the standard of living shared during the marriage.  Harlow, 251

    Ill. App. 3d at 159, 621 N.E.2d at 935.

             Although Maryse testified she planned to attend graduate

    school, there was no evidence she had applied, been accepted, or

    what course of study she would take.

             In the present case, the parties have grossly disparate

    earning potentials.  Frantz has substantial income and future

    earning ability, fostered by the award of his medical practice.  He

    testified his net business income for 1994 was $292,940.  In

    addition, there had been testimony in this case relating to

    interest and dividend income, although no mention of that was made

    at the hearing on maintenance.  Frantz is able to meet not only his

    needs but those of Maryse.  Maryse, the children, and her sister

    lived in her mother's home.  Although Maryse had obtained a

    bachelor's degree in chemistry, she had not yet completed an

    internship and did not have a job.  In addition, she was the

    primary caregiver to the parties' children.  During the marriage,

    Frantz and Maryse enjoyed an affluent lifestyle.  Maryse's realis-

    tic ability to support herself in some approximation of the

    standard of living enjoyed during the marriage is minimal.  The

    trial court expressly found that the parties had "an opulent style

    of life" and lived beyond their means.  We recognize the trial

    court in this case made every effort to be fair and that Maryse's

    proof on maintenance was somewhat less than adequate.  She

    projected a "rent" of $1,500 per month based on what she thought it

    would cost to obtain a house in Florida.  As it appears Frantz was

    paying $1,500 per month on his mortgage for his new house, that

    does not appear to be unrealistic.  In addition, she projected

    utility bills ($225) based on what her mother was paying.  Maryse's

    most recent financial affidavit concluded she required $6,982.67

    for monthly living expenses.  There is a significant difference

    between her expenses and the maintenance to be paid by Frantz.  The

    award of maintenance in this case was inadequate.  Because this

    case is remanded for reconsideration of property distribution,

    there must also be reconsideration of the amount of maintenance and

    whether permanent maintenance for Maryse would be appropriate.

             The judgment of the circuit court of Macon County is

    reversed.  The cause is remanded for further proceedings consistent

    with this opinion.

             Reversed and remanded.

             GARMAN, J., concurs.

             STEIGMANN, J., specially concurs.

             JUSTICE STEIGMANN, specially concurring:

             Although I do not disagree with the majority's decision

    to reverse or anything it says in reaching that decision, I

    disagree that it should be saying any of this in the first place.

    The majority claims to be giving deference to Talandis, which held

    that, in the absence of an appellee's brief, a reviewing court

    should reverse (1) if the appellant's brief demonstrates prima

    facie evidence of reversible error, (2) the record supports the

    appellant's allegations, and (3) a reviewing court cannot easily

    evaluate the issues on appeal.  Talandis, 63 Ill. 2d at 133, 345

    N.E.2d at 495.  The majority then concludes that "[t]he record in

    this case is not so complicated as to prevent this court from

    reviewing the issues on the merits."  Slip op. at 2.  I respect-

    fully disagree.

             The record in this case is not simple, and the claimed

    errors are not such that we can easily decide them without the aid

    of the appellee's brief.  The 22-volume record consists of over

    2,500 pages.  Further, the scrutiny the majority was required to

    give this record in order to decide this case and to prepare its

    carefully detailed opinion belies the majority's assertion

    regarding the uncomplicated nature of this record.  

             I agree with the majority that an analysis of the record

    reveals prima facie evidence of reversible error.  Maryse's brief

    clearly supports her challenges to the propriety of the trial

    court's rulings, with appropriate citations to the record and case

    authority.  Accordingly, we should take the supreme court at its

    word in Talandis, reverse the trial court's judgment, and remand

    with directions that the trial court grant Maryse all of the relief

    she requested on appeal.  We should do so without ever addressing

    the merits of the trial court's order.

             It is somewhat ironic that part of the explanation the

    majority provides for its willingness to address this case on the

    merits is its wish to give deference to the work of the trial

    judge.  See slip op. at 2.  I suggest that the majority's willing-

    ness to decide this case on the merits in the absence of an

    appellee's brief--which might have addressed some of the majority's

    concerns regarding the trial court's rulings--runs contrary to the

    deference the majority claims to show.  No trial court likes to get

    reversed, but it would be far more palatable to be reversed because

    the appellee simply failed to show up at the appellate court than

    to be reversed--purportedly on the merits--when no one defended the

    trial court's rulings in the appellate court.  As the majority cor-

    rectly points out, "a reviewing court should not be compelled to

    serve as appellee's advocate."  Slip op. at 2.  So, if this court

    does not serve as appellee's advocate, and the appellee elects not

    to appear himself, then who is supposed to defend the trial court's

    rulings?

             I indicated earlier that I had no disagreement with the

    majority on the merits, but in so stating I should clarify that

    this concurrence is based upon the majority's assessment of the

    record and the trial court's rulings in the absence of anyone

    appearing in this court to argue that those rulings were correct.

    Under Talandis, we need be satisfied only that the record reveals

    prima facie evidence of reversible error--a standard I think this

    record clearly shows.  Nonetheless, it is at least possible that

    had the trial court had someone defending its rulings before us,

    our assessment of some (or even all) of those rulings might have

    changed.  Speaking only for myself, it often happens that I am much

    more impressed with an appellant's arguments after having read only

    the appellant's brief than I am after I have also read the

    appellee's brief.