By: Donald C. Schiller
Schiller DuCanto & Fleck LLP
Chicago, Lake Forest and Wheaton, Illinois
Telephone: (312) 641-5560; Facsimile: (312) 641-6361:
Michelle A. Lawless
The Law Office of Michelle A. Lawless LLC
180 N. LaSalle St. Suite 3700 Chicago, Illinois
Telephone: (312) 741-1092
1. Child support true-up provisions in marital settlement agreement stricken by Appellate Court. Husband brought a three-count post-judgment petition to modify child support wherein one count he requested the court to calculate the proper “annual true-up” between he and the wife pursuant to the language of their marital settlement agreement (MSA). Central to the analysis of the issue were two particular paragraphs in the MSA which defined husband’s net income. The first defined it as all income reported on his tax return reduced by federal and state income tax and social security. The second defined it as all income received by a business he owned reduced by: (1) 30% and; (2) by the total amount husband paid in health insurance for himself and the children. Both parties testified the support provisions in the MSA were negotiated during mediation with a non-lawyer and that a lawyer was hired by wife only after the mediation to draft the agreement reached. The parties disagreed on the application of the two provisions to the calculation of husband’s net income. Wife asked the court to strictly construe the terms of the MSA and order him to pay $75,919 in retroactive support and husband took the position that the enumerated deductions set forth in each paragraph should apply to all of his income and that he owed no retroactive support. The trial court calculated husband’s net income by reducing his annual total gross income by his federal and state taxes, social security, health insurance premiums, and maintenance, and found husband owed wife $7,870 in retroactive support. The trial court then struck the true-up provision in the MSA prospectively. After engaging in a lengthy analysis of Section 505 of the IMDMA before and after the recent amendments, as well as several cases regarding the computation of net income, the Appellate Court affirmed the trial court’s striking of the true-up provisions. The Court ultimately concluded that the MSA true-up provisions and definition of net income contravened the concept of “net income” under Section 505 of the IMDMA. The Court, however, reversed the $7,870 owed by husband to wife stating that since the true-up provisions were irreconcilable with the IMDMA, they should have been stricken entirely. See Flash Point #2 regarding the calculation of child support going forward. In re Marriage of Solecki, 2020 IL App (2d) 190381.
2. Substantial change of circumstances finding upheld. Husband brought a three-count post-judgment petition to modify child support wherein one count he requested the court to reduce his child support obligation due to the fact that his income had decreased since the entry of judgment and wife’s income had increased. The parties had a complex and difficult to interpret true-up mechanism in their marital settlement agreement (MSA) which was struck down by both the trial and Appellate Courts. The trial court ultimately determined that a substantial change of circumstances did exist and calculated husband’s child support at $3,452 per month per section 505 of the IMDMA. It then deviated upward to $4,000 per month in light of the fact that it struck the ongoing true-up provisions in the MSA. The Appellate Court affirmed. The loss of the true-up provisions in the MSA was significant since husband’s income came from several sources and fluctuated. The true-up held him accountable each year for any shortages in support paid that may have occurred. Striking such provision justified an upward deviation in the monthly support under the new guidelines. Further, the striking of the true-up provisions in and of itself met the threshold for re-visiting the child support award. In re Marriage of Solecki, 2020 IL App (2d) 190381.
3. Order for each party to pay their own attorneys’ fees in post-judgment action affirmed. Wife challenged the trial court’s order disposing of post-judgment child support issues which also ruled that each party would pay his and her own attorneys’ fees and costs. Wife argued that the trial court did not provide either party with the ability to file a petition for contribution prior to issuing such order, essentially arguing that the court sua sponte pre-empted a petition for contribution to fees. The Appellate Court affirmed noting that the trial court had the matter under advisement for a month before issuing its order and wife did not file a petition for contribution during that time, nor did she ask the court to reconsider the issue of costs and attorneys’ fees. In re Marriage of Solecki, 2020 IL App (2d) 19038.
4. Retroactive support back to the date of the filing of the petition for dissolution of marriage upheld. Husband appealed the order of the trial court which awarded wife a retroactive amount of unallocated maintenance and child support in the amount of $34,150 in the judgment for dissolution of marriage. The parties had entered into an agreed temporary support order wherein husband had agreed to pay wife’s mortgage, car insurance, and $250 per month for their child’s personal expenses. At trial, the court determined the amount of the temporary support should have been higher based on its calculations of each parties’ incomes, which was the reason for the retroactive award. A section 501 order for temporary maintenance and child support is merely a stopgap that lasts only until the court resolves the pending issues. The trial court was within its authority to award wife maintenance and child support from the date of her request in her petition for dissolution of marriage, with appropriate credit given to husband for the payments made under the temporary order. Additionally, the Court also dealt with the issue of the deduction of accelerated and non-accelerated depreciation under the amended child support statute. The statute clearly excludes accelerated depreciation from the calculation of net business income, but leaves the issue of non-accelerated depreciation to the discretion of the trial court if the court determines it to be an appropriate business expense that is required to carry on the business. In re Marriage of Hochstatter, 2020 IL App (3d) 190132.