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In Re Marriage of Lee



Appeal from the Circuit Court of Cook County; the Hon. Norman Eiger, Judge, presiding.


Respondent Richard Lee appeals from the circuit court's denial of his motion to vacate a judgment of dissolution of marriage. Respondent contends: (1) the judgment for dissolution incorporated a property settlement agreement which was unconscionable and the product of coercion; (2) the judgment was based on false testimony by petitioner Kurtlyn Lee; (3) a new hearing on respondent's motion should be granted because the circuit court erroneously permitted one of petitioner's attorneys to testify; (4) the circuit court's award of attorney fees and costs to the petitioner was an abuse of discretion.

We affirm.

The parties were married in 1973. A judgment for dissolution of their marriage was entered January 7, 1983. The judgment incorporated a property settlement agreement signed by both parties December 6, 1982. Petitioner received custody of their seven-year-old son, with respondent agreeing to pay $600 per month child support. Petitioner also received the marital residence (a condominium subsequently valued at approximately $80,000 to $90,000 with a $14,000 mortgage), a 1982 Pontiac (valued at $10,000 but apparently not completely paid for), a $50,000 whole life policy (with a cash value of $14,000), a $100,000 term insurance policy (no value determined), household furniture (subsequently valued at approximately $6,000), and $187 from a joint bank account.

Respondent received a Bronco truck (valued at $14,000 to $18,000 with a $7,000 lien), a snowmobile and trailer (subsequently valued at $1,400), a van (valued at $4,500); stock in two family-owned restaurants (the disputed valuation of this stock is discussed later in this opinion), and $1,800 from a joint bank account ($1,340 of which was used to pay some of petitioner's attorney fees). Petitioner also gave up any right to maintenance, which respondent's attorney conceded at trial was worth $5,000 to $10,000.

At the hearing on the petition for dissolution respondent testified that he was not contesting the petition, that he had read and understood the property settlement agreement and that he wanted the court to approve it. However, at the hearing on the motion to vacate respondent attempted to repudiate this testimony.

Respondent testified that he had discussed the property settlement agreement with petitioner on a number of occasions before signing it. After their discussions she went to her lawyer, Ray Allen, who prepared the agreement. Respondent testified that when petitioner showed him the draft he was surprised at what she wanted. He consulted an attorney for Lang Lee, who in turn recommended that he consult attorney R.S. Maione (who has subsequently represented him on this cause). Respondent conceded at the hearing that although Maione told him he should not sign the agreement, he signed it anyway.

Respondent offered several explanations for having signed the agreement. He testified that he did so because he hoped petitioner would later return to him. However, he also testified that he agreed because petitioner threatened to report to the Internal Revenue Service that he and his parents were "skimming" money from corporate sales. Respondent testified that this accusation was untrue, but caused him to sign the agreement because he feared embarrassment to his family. Respondent also testified that petitioner threatened to remove their child to California and to "go for his throat" concerning their division of property if he didn't agree to the terms she and her lawyer presented. According to respondent, that attorney (Ray Allen) also threatened that respondent's failure to sign would cause them to "go for his throat" financially.

Respondent, who had attended college for two years, testified that he was the manager and chef at Lang Lee 1, a Chinese restaurant in Evergreen Park. He owned 20% of the stock in Lang Lee 1, Incorporated and one-sixth of the stock in a second family-owned restaurant, Lang Lee 2.

Petitioner specifically denied in her testimony that she had threatened respondent. At the time of the dissolution she was making approximately $10,000 per year. She stated that she and respondent agreed to a property settlement which her attorney then drafted. She and respondent had lunch after the dissolution prove-up, at which time he expressed his relief that the matter was over. Attorney Allen also testified that he had never threatened respondent. Petitioner had given him the terms which she and respondent had agreed to. Subsequently respondent telephoned to ask if he thought this agreement was fair. Allen told him that it was.

Respondent presented the testimony of two accountants concerning the value of his stock in the two family corporations. Raymond Garrigan, a certified public accountant, had done the books for Lang Lee 2 since the start of that business in May 1981. The other stockholders in that corporation (each with a one-sixth interest) were respondent's father, stepsister, brother-in-law, and two brothers. In 1983 respondent was paid approximately $20,000 for his work with the restaurant.

Garrigan's opinion was that respondent's stock in Lang Lee 2 was worth nothing. He based this in part on the fact that the restaurant had a net loss of $16,017 in 1982 and a profit of only $544 in 1983. However, Garrigan also testified that in 1982 the restaurant had gross sales of $633,066 and gross profits (gross sales minus cost of food and beverages) of $288,450. In 1983 gross sales were $685,923 and gross profits were $307,254. Indeed for the first eight months of the restaurant's operation (beginning May 1, 1981) gross sales were $361,000.

In 1983 Garrigan had prepared a financial statement for the corporation. The statement included his notation that because the management had omitted substantially all of the disclosures required by generally accepted accounting principals (including changes in financial position and the amount of any retained earnings), the statement was not for those not informed of those items. Garrigan conceded that in effect this meant he was not taking responsibility for the accuracy of the statement because he did not perform the audit.

Garrigan also testified that the only method of establishing the value of a closely held corporation's stock, which was not traded, would be to determine what a willing buyer would pay in the market place. It was his opinion that respondent's stock had no market value because his was a minority interest. He testified that ...

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