APPELLATE COURT OF ILLINOIS, SECOND DISTRICT
and PHILIP W. VERDUNG, Respondent (Jo Ann Verdung,
515 N.E.2d 454, 162 Ill. App. 3d 374, 113 Ill. Dec. 645 1987.IL.1637
Appeal from the Circuit Court of Kane County; the Hon. R. Peter Grometer, Judge, presiding.
JUSTICE WOODWARD delivered the opinion of the court. UNVERZAGT, J., concurs. JUSTICE REINHARD, Dissenting.
DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE WOODWARD
Petitioner, respondent's first wife (Christine), appeals from a decision of the circuit court of Kane County which awarded the respondent's second wife (JoAnn) one-half of the net proceeds from the sale of certain residential real estate located in Glen Ellyn, Illinois (subject premises). On appeal Christine raises one issue, namely, that the trial court erred as a matter of law when it awarded JoAnn one-half of the net proceeds from the sale of the subject premises.
On April 19, 1978, Christine filed a petition for dissolution of her marriage to respondent (Philip). On June 23, 1978, Philip filed his response to this petition and filed a counterpetition for dissolution. On October 19, 1978, the matter was heard as a stipulated matter on the issue of grounds only. After the hearing based on the stipulation as to grounds, the trial court found in Christine's favor. The matter was then continued for trial on the issues of property, support, and maintenance.
On March 26, 1979, Christine requested the court to vacate its finding on the issue of grounds, since the parties (Christine and Philip) had reached a complete agreement on all issues. The court granted that request, and on April 9, 1979, a judgment for dissolution of marriage was entered. Pursuant to that judgment, Philip agreed to pay Christine a lump sum of $115,000 to be paid in monthly installments of $950, commencing May 1, 1979. The final payment, due May 1989, was to be for $1,000. The payments were taxable to Christine and were not to terminate in the event of her death or remarriage or Philip's death. Upon completion of the payments, Christine agreed to be forever barred from making any further claims against Philip for support or maintenance.
Philip married JoAnn on April 16, 1979. In July 1980, JoAnn and Philip purchased as joint tenants the subject premises commonly known as 23 W 144 Red Oak Drive, Glen Ellyn, Illinois.
On December 28, 1982, Christine filed a rule to show cause against Philip. On January 27, 1983, the trial court found that Philip was in arrears in the amount of $1,700 and ordered him to make increased monthly payments to satisfy the arrearage. On August 22, 1983, Christine filed a second petition for rule to show cause against Philip. On the same date, the trial court entered a rule to show cause against Philip. In the next several months, three alias rules to show cause were entered by the court.
On January 27, 1984, Philip conveyed all of his right, title, and interests in the subject premises to JoAnn. On April 12, 1984, Philip filed an answer to Christine's second petition for rule to show cause. The following day a hearing was held on the return of the rule; Philip was present with his attorney; also, JoAnn was present. Christine's attorney stated he was going to call JoAnn as a witness, and Philip's attorney inquired as to the reason for her testimony. Christine's attorney refused to state a reason and then Philip's attorney stated in part:
"MR. HUSZAGH [Philip's attorney]: Your Honor, may I know why JoAnn Verdung is going to be asked to testify?
MR. MARSH [Christine's attorney]: He is not entitled to that Information.
MR. HUSZAGH: Yes, I am. If he wants to say now, 'I'm going to exclude her from the courtroom,' she wants to hear what goes on with her husband, and it's very important to her ; and this is a tactic they have done three times before." (Emphasis added.)
JoAnn testified at this hearing.
The next hearing on the rule to show cause against Philip was held on July 27, 1984. Christine's attorney stated that he was unable to serve Philip with a rule to show cause and that he needed assistance in ascertaining Philip's whereabouts; he requested that Philip's attorney stipulate that JoAnn be in court to testify at subsequent hearings, and, thereafter, the following colloquy occurred:
"MR. HUSZAGH [Philip's attorney]: Rather than putting the responsibility on me, I think that is an appropriate thing to address to the Court -- have the Court to do.
THE COURT: On the Court's motion, I'm going to add her as a party for the purpose of testifying in this cause.
MR. HUSZAGH: Merely for the purpose of testifying?
THE COURT: Merely for the purpose of testifying. If we discover he made improper transfers, that order can be expanded."
The transcript of proceedings for July 27, 1984, did not show that JoAnn was present in court; however, the order that was entered restrained Philip from selling the subject premises and added JoAnn as a party-defendant for the purpose of having her appear and testify, and it directed her to attend subsequent hearings. JoAnn did not file a special or general appearance or file any objections to the court's order making her a party to the lawsuit at that time or at anytime thereafter until November 19, 1985, as hereafter set forth.
On October 4, 1984, Christine's attorney appeared on a motion to appoint a sequestrator for the subject premises; this motion stated that Philip had conveyed his assets to JoAnn and that the subject premises was Philip's last known asset that could be used to satisfy his obligation to Christine. At this hearing JoAnn was called to the stand, but the proceedings thereafter are not reported except that a conference was held in the Judge's chambers, and, on returning to the courtroom, the Judge stated in part as follows:
"Let the record show that we have had a conference in chambers concerning the Disposition of this matter. . . . Without further testimony the Court has made a proposal and would enter FINDINGS in accordance with that proposal. . . . [The] conveyance of the MARITAL home of Mrs. Verdung was found to be a fraud AS AGAINST the former wife, and in accordance with that finding the house shall stand as security for the balance due and payable to Mrs. Christine Verdung."
There is no showing in the record whether or not JoAnn was present at the conference in the Judge's chambers. At that time, counsel agreed that the total amount due from Philip to Christine was $56,000.
On November 4, 1984, the attorneys for Christine and Philip appeared to present their prospective positions and to have an order based on the October 4, 1984, hearing. During the Discussion, Philip's attorney stated in part as follows:
"But as to the order that he has presented to the Court and which doesn't completely follow, but in the large part follows the Court's statements of October 4, and that was following a couple of hearings. And your Honor found that the home that Mr. Verdung lived in in Glen Ellyn on Red Oak Drive, that his conveyance to his present wife, Joanne Verdung, was in violation of the Illinois Fraudulent Conveyance Act and, therefore, the lien of Christine Rii -- I guess it is Christine Verdung Riis -- should be imposed upon that property. We are not here objecting to that, your Honor. What we are objecting to is the Court entering an order which would, in effect, accelerate the payments."
Thereafter, the court stated that the order to be entered would provide for depositing the money from the sale of the subject premises with the circuit clerk to be invested in a certificate of deposit. The hearing was adjourned with the understanding that the order would be rewritten.
On December 4, 1984, the court entered an order which was based on the proceedings held on October 4, 1984; it made the following findings: that the conveyance of the marital home by Philip to JoAnn was a fraud against Christine and that the subject premises should stand as security for the balance of $56,900 remaining due and payable by Philip to Christine. The court further ordered that in the event the subject premises were sold, any remaining balance of the lump sum payment due Christine would be accelerated and paid out of the proceeds of the sale and that if any arrearage remained at the time of the sale, such arrearage would be paid from the proceeds. The court also ordered a schedule of payments due and payable to Christine from Philip.
On June 4, 1985, Christine filed a motion against Philip and JoAnn for a rule to show cause and for sanctions for violation of the court order of December 4, 1984; the motion requested the court to order "respondents" to convey the subject premises to Christine or allow her to take possession of the subject premises so that she could get the rent, as the subject premises had been occupied by a tenant. Notice of this motion was served upon attorney Huszagh and Philip and JoAnn at the address of the subject premises. The court issued a rule to show cause on June 5, 1985, against Philip for failure to comply with the previous support orders, and the rule was continued to July 9, 1985.
On July 9, 1985, the trial court entered an order stating that "counsel for parties both being present," and that the matter came on the continued motion of Christine filed on June 4, 1985. Said order provided that the subject premises "owned by JoAnn shall be conveyed to Christine Verdung by a Judge's deed to be issued by this court." Christine was to immediately list the subject premises for sale, and further, the order provided in part as follows:
"3. That prior to closing, any sale and distribution of funds shall be presented to this court for approval.
5. That at closing, all arrearages paid immediately and directly to Christine Riis [Verdung] the balance owed her shall be placed in escrow at Gary Wheaton Bank, said balance to be paid her in monthly installments equivalent to payments ordered by this court in Judgment for Dissolution of Marriage of 4 -- 9 -- 79."
Said order further provided that Christine should list the subject premises for sale for $250,000. On July 9, 1985, the court also entered a rule to show cause against Philip's attorney requiring him to disclose the whereabouts of Philip. This rule was returnable on August 6, 1985. On August 6, 1985, the court entered an order modifying the order of July 9, 1985, to provide for the Judge's deed to be executed by Honorable Judge James Wilson, and further, it discharged the rule entered against Philip's attorney.
A transcript was filed in this cause of certain proceedings of August 16, 1985, heard before the same Judge who signed the order of July 9, 1985. At this hearing, Christine's attorney and Philip's attorney appeared, and they discussed the Judge's deed as follows:
Take this [the deed] to Judge Wilson and you can ...