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In Re Marriage of Smith

OPINION FILED OCTOBER 15, 1980.

IN RE MARRIAGE OF IONA SMITH, PETITIONER-APPELLANT, AND GAINES N. SMITH, RESPONDENT-APPELLEE.


APPEAL from the Circuit Court of St. Clair County; the Hon. ROBERT J. SAUNDERS, Judge, presiding.

MR. JUSTICE KASSERMAN DELIVERED THE OPINION OF THE COURT:

Rehearing denied November 12, 1980.

Petitioner, Iona Smith, appeals from the April 25, 1979, order of the St. Clair County Circuit Court with respect to the assignment and division of property and the denial of petitioner's prayer for the award of maintenance and attorney fees in a proceeding for dissolution of marriage.

The parties, Iona Smith and Gaines N. Smith, were married October 13, 1956. One child, Gaines B. Smith, was born of the marriage. The parties separated on September 8, 1977, and a decree of dissolution of marriage was entered October 12, 1978. Subsequently, a hearing was held on October 26, 27, and 30, 1978; and the trial court entered its order on January 3, 1979, relative to all issues other than the dissolution of marriage. Petitioner filed a post-trial motion, and a hearing was held on it on February 22, 1979. The trial court entered an amended judgment on April 25, 1979, correcting certain omissions in the original order. It is from this order that petitioner appeals.

During the marriage, respondent was engaged in the sale of insurance and mutual funds. He suffered a heart attack in November 1977, and since that time has been forced to limit his work. Petitioner is currently residing in Indianapolis, where she is employed as an executive secretary. Since 1974, petitioner has held various secretarial positions. Petitioner had two children, William and Candace Koriath, by a previous marriage. William resides in Indianapolis, and her daughter, Candace, was killed in an automobile collision in 1972. As a result of that collision, petitioner received approximately $17,000 in insurance proceeds, which were subsequently either placed in bank accounts or invested in stocks.

The evidence adduced at the hearing disclosed that the parties had acquired various parcels of real estate and various stocks and bank accounts during the marriage. On appeal petitioner raises numerous assignments of error relating to the assignment and division of the parties' real property, stocks, bank accounts, pickup truck, and pension plans. She also urges that the trial court erred in denying her request for maintenance and attorney fees.

With respect to the disposition of the parties' real property, petitioner contends (1) that the court erred in fixing the value of the marital home at $41,420 and ordering petitioner to convey her interest in such home to respondent in exchange for one-half that value to be paid by him; (2) that the trial court incorrectly considered 46.89% of a 200-acre tract of land in Washington County to be respondent's non-marital property; (3) that the trial court erred in awarding respondent an interest in certain property in Indianapolis, Indiana; (4) that the court erred in finding that a combination office and apartment designated as 117 W. Washington St., Belleville, Illinois, was respondent's non-marital property.

The marital home at 421 Missouri Avenue, Belleville, Illinois, was purchased in 1959. Respondent testified that its current value was between $46,000 and $48,000. Petitioner in her testimony estimated the value to be $70,000. In its order the court found the value of the home to be $41,420, found it to be marital property, and awarded it to respondent. The trial court ordered petitioner to convey her interest in the home to respondent, and respondent was ordered to pay her $20,710 for such interest. Petitioner asserts that the trial court erred in finding the value of the home to be $41,420 and in not ordering it to be sold and the proceeds divided rather than ordering her to convey her interest to respondent.

• 1 We find no error in ordering petitioner to convey her interest in the marital residence to respondent. The distribution of marital property is within the discretion of the trial court, and it will not be disturbed except for a clear abuse of discretion. (In re Marriage of Thornqvist (1979), 79 Ill. App.3d 791, 399 N.E.2d 176; In re Marriage of McMahon (1980), 82 Ill. App.3d 1126, 403 N.E.2d 730.) In the case at bar respondent planned on remaining in the Belleville area while petitioner had moved to Indianapolis. The parties' son was also still in Illinois attending college. Based on these considerations it was reasonable for the court to permit respondent to retain the marital home and to require petitioner to convey her interest to respondent in return for her being compensated for one-half of the value of the property rather than to require the property to be sold and the proceeds divided. However, there is no evidence in the record to substantiate the court's finding the value of the house to be $41,420. Respondent, who is also a licensed real estate broker, estimated the value to be between $46,000 and $48,000, while petitioner testified that the value was $70,000. The court in In re Marriage of Evans (1980), 85 Ill. App.3d 260, 406 N.E.2d 916, refused to disturb the trial court's finding as to the value of the home of the parties where it was within the range of value presented at trial; however, in the case at bar the trial court fixed the value at a figure almost $5,000 lower than the lowest estimation of its value. Therefore, this cause must be remanded for the trial court to establish the value of the home on the evidence introduced at trial.

The parties owned in joint tenancy a 200-acre tract of land in Washington County, Illinois. The property was acquired by the parties in 1965 for $12,900. Respondent testified that $2,036.89 of the down payment was made from his non-marital funds. He stated that $1,000 of the down payment was a gift from his mother and $1,036.89 was from the proceeds of the sale in 1965 of property on Bel Air Drive that the parties owned in joint tenancy. Respondent testified that $1,036.89 of the funds used to purchase the Bel Air Drive property in 1957 also had been a gift from his mother. Respondent further testified that $3,670.15 of his inheritance from his mother was used to make mortgage payments on the property. Respondent estimated the value of the land to be $72,500, while petitioner valued it at $200,000.

The trial court ordered the 200 acres in Washington County to be sold and ordered respondent to be paid 46.89 percent of the proceeds of sale of the property as his non-marital property. The court found that the respondent's payments on the original purchase price and his payments on the mortgage from his own funds represented 46.89 percent of the purchase price of $12,900 and that he consequently is entitled to 46.89 percent of the sale proceeds. The trial court further ordered that the remaining 53.11 percent of the proceeds of sale of the property was marital property to be divided equally between the parties.

Petitioner contends that the trial court improperly awarded respondent 46.89 percent of the proceeds of sale of the 200-acre farm as his non-marital property. We agree.

• 2 Respondent is entitled to a refund of the amount of identifiable non-marital funds he paid towards the acquisition of the 200 acres in Washington County. (In re Marriage of Preston (1980), 81 Ill. App.3d 672, 402 N.E.2d 332; In re Marriage of Dietz (1979), 76 Ill. App.3d 1029, 395 N.E.2d 762.) However, he is not entitled to a percentage of the proceeds of sale of the property based on the investment of his own funds in the original purchase. Such a method of computing his interest would result in his receiving the appreciation in the value of his non-marital property which was acquired after the marriage. This court has held that appreciation in non-marital property acquired after the marriage is marital property. (In re Marriage of Preston; cf. In re Marriage of Komnick (1979), 78 Ill. App.3d 599, 397 N.E.2d 886.) Respondent testified to a total investment of $6,045.15 of his non-marital funds in the Washington County farm. Under the decision of this court in Preston and Dietz, non-marital property, including property acquired in exchange for non-marital property, remains non-marital and is required to be refunded to the party claiming it so long as the source of the funds can be traced to the newly acquired property without affirmative proof of an intention to make a gift in the acquisition of the replacement property. In the instant case, the evidence also established that respondent contributed $2,375 to the down payment for such farm from monetary gifts made to him by his mother. These are to be considered as non-marital property under section 503(a)(1) (Ill. Rev. Stat. 1977, ch. 40, par. 503(a)(1)). (In re Marriage of Preston; In re Marriage of Dietz.) Respondent also made mortgage payments on the farm property in the total amount of $3,670.15 with his inheritance, and he is also entitled to a refund of that amount as non-marital property. (In re Marriage of Preston; In re Marriage of Dietz.) Therefore, respondent is entitled to a refund of $6,045.15 from the proceeds of the sale of the Washington County farm, and the remainder is required to be considered as marital property in its division.

Petitioner next contends that the trial court erred in awarding respondent one-half of the net equity of a dwelling located in Indianapolis, Indiana. The record owner of such dwelling is William Koriath, petitioner's son.

Petitioner testified that she rents the dwelling in Indianapolis from her son, William Koriath. She stated that she had supplied her son with $4,000 for the down payment on the house and an additional $4,000 for improvements. These funds were paid from the insurance proceeds she received as a result of her daughter's death. The house was purchased for $18,500 in 1978; and petitioner stated that the house was now worth $35,000. The trial court ordered that petitioner be awarded $6,000 for her non-marital share of the property. It then ordered that the net equity of $14,500 remaining after deducting a mortgage of $14,500 from the present value of the house be divided equally between the parties as marital property. This division was to be accomplished by adjusting the sums found to be due to the respective parties to compensate each of them for their assigned share of the total assets. Petitioner was credited for the $6,000 award to her as a non-marital asset and was ordered to pay respondent $7,250, being one-half of the remaining value of the dwelling after deducting the $14,500 mortgage to which it was subject. The court did not order a sale of the dwelling.

• 3 The trial court's order relating to the Indianapolis dwelling was in error because William Koriath was the record owner of such property and he was not made party to these proceedings. The sums petitioner loaned to her son to purchase the property were paid from petitioner's non-marital funds; therefore, respondent has no basis to claim any interest in it, either at law or in equity.

Petitioner further contends that the trial court erred in awarding respondent the real estate at 117 West Washington Street, Belleville, Illinois, as his non-marital property. She contends that only one-third of this property should have been considered as ...


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