APPEAL from the Circuit Court of Du Page County; the Hon. S.
KEITH LEWIS, Judge, presiding.
PRESIDING JUSTICE SEIDENFELD DELIVERED THE OPINION OF THE COURT:
The impact of the automatic stay provision under the Federal Bankruptcy Act (11 U.S.C. § 362 (Supp. III 1979)) upon proceedings in the circuit court for enforcement of property distribution under a judgment for dissolution of marriage, is before us in this appeal.
The marriage of petitioner, Nancy Lytle, to respondent, John J. Lytle, Jr., was dissolved in 1981. On March 5, 1981, the court issued a supplemental judgment by whose terms petitioner was awarded the parties' lakefront property in Michigan. Respondent was also to reimburse petitioner for all sums paid by her on account of the garnishment of her wages for a debt due to the Bank of Naperville and hold her harmless from all future garnishments arising out of that debt. By separate order entered the same date, respondent was ordered to pay the sum of $1,500 toward petitioner's attorney fees.
On April 8, 1981, petitioner filed a petition for a rule to show cause, alleging that respondent had failed to make any payment toward petitioner's attorney fees and had failed to communicate with respondent concerning the debts from which he had been ordered to hold her harmless. It was also alleged that petitioner had incurred a further garnishment proceeding by reason of respondent's total failure to settle or pay the claim which had resulted in those garnishments. The rule was issued, and a hearing thereon was held on June 29, 1981. At that time, respondent's counsel presented the court with a copy of a bankruptcy petition which had been filed on respondent's behalf in the United States Bankruptcy Court for the Northern District of Illinois on June 25.
At the hearing, respondent testified on his own behalf that his conduct was not intended as contemptuous, but that his financial circumstances were poor. He had first learned of the garnishment of petitioner's wages only three weeks before. An issue was raised as to whether respondent had improperly sold the boat dock at the Michigan property, and respondent, while admitting that the dock was not removed from the property until after the supplemental judgment, claimed that the sale had taken place beforehand, in February 1981.
Respondent's counsel advised the court that the filing of a bankruptcy "generally should stay proceedings" in State courts> concerning the debts of the bankrupt, but the court, after ascertaining that the bankruptcy court had not issued a stay order, found that the pending Federal action did not obviate respondent's obligation to pay the debt for which petitioner's wages were being garnished. The court found that respondent's conduct concerning the sale of the boat dock and the "hold harmless" provision of the supplemental judgment was willful and contumacious. It ordered respondent incarcerated for 14 days beginning July 13, 1981, unless the dispute over these matters was resolved in the interim. The matter concerning respondent's obligation for attorney fees, including the effect of the bankruptcy thereon, was continued to July 14, 1981, and the mittimus was stayed until that date. On July 17, 1981, respondent filed a motion to reconsider and to stay further proceedings pending the outcome of the pending bankruptcy case. The court denied the motion, and respondent has appealed.
Respondent contends that the trial court erred in proceeding with an adjudication on the rule to show cause after being apprised that respondent had filed a petition for relief under Chapter 7 of the Bankruptcy Act. Respondent asserts that, as provided by section 362 of the Act (11 U.S.C. § 362 (Supp. III 1979)), the trial court was obliged to recognize that the filing of the bankruptcy petition operated as an automatic stay of State proceedings designed to enforce the property and attorney fees provisions of the supplemental judgment.
Section 362(a) provides that the filing of a petition under Chapter 7 of the Bankruptcy Act operates as a stay of
"(1) the commencement or continuation, including the issuance or employment of process, of a judicial, administrative, or other proceeding against the debtor that was or could have been commenced before the commencement of the case under this title, or to recover a claim against the debtor that arose before the commencement of the case under this title;
(2) the enforcement, against the debtor or against property of the estate, of a judgment obtained before the commencement of the case under this title;
(3) any act to obtain possession of property of the estate or of property from the estate;
(6) any act to collect, assess, or recover a claim against the debtor that arose before the commencement of the case under this title;
Exceptions to the automatic stay are set out in section 362(b) and, as herein applicable, include:
"(1) under subsection (a) of this section, of the commencement or continuation of a criminal action or ...