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12/03/96 MARRIAGE MARILYN KATHLEEN HEGGE

December 3, 1996

IN RE MARRIAGE OF MARILYN KATHLEEN HEGGE, PETITIONER-APPELLEE, AND ALFRED DEAN HEGGE, RESPONDENT-APPELLANT.


Appeal from the Circuit Court of Winnebago County. No. 94--D--327. Honorable K. Craig Peterson, Judge, Presiding.

The Honorable Justice Bowman delivered the opinion of the court. Geiger and Rathje, JJ., concur.

The opinion of the court was delivered by: Bowman

JUSTICE BOWMAN delivered the opinion of the court:

Following dissolution of marriage proceedings, the trial court awarded petitioner, Marilyn Hegge, the marital home. The trial court ruled that the marital home could be classified as nonmarital property because Marilyn acquired it in exchange for nonmarital property. On appeal, respondent, Alfred Hegge, challenges this ruling. We reverse and remand.

The following facts are taken from both the parties' agreed statement of facts and the record. Marilyn and Alfred were married in 1985 and resided on Merrill Avenue in Loves Park, Illinois (Merrill property). Marilyn had acquired the Merrill property as part of a prior dissolution of marriage. At the time of the Hegges' marriage, Alfred moved into the Merrill property. Marilyn owned the Merrill property subject to a mortgage which the Hegges paid out of their joint checking account.

On July 31, 1986, the Hegges sold the Merrill property and purchased a home on Petunia Drive in Machesney Park, Illinois (Petunia property). Marilyn received $35,855.93 for the Merrill property and applied that entire amount to the $62,000 purchase price of the Petunia property. Alfred did not contribute any of his personal assets to the Petunia property purchase. The Hegges then obtained a $27,000 mortgage loan for the balance of the purchase price of the Petunia property. While both Alfred and Marilyn signed the mortgage note, title to the Petunia property was placed only in Marilyn's name. The mortgage payments on the Petunia property were again paid out of their joint checking account.

At some point after the Hegges began living at the Petunia property, Marilyn quit her job. While the mortgage payments on the Petunia property were still made from the joint account, Alfred's income became the sole source of funds for that account. On June 17, 1993, Marilyn and Alfred refinanced the original terms of the mortgage on the Petunia property. The application was approved using Alfred's employment as the sole source of income for the couple. The stipulated value of the Petunia property is $83,500.

On March 17, 1994, Marilyn filed a petition for dissolution of marriage. Following a bench trial, the court found that, under section 503 of the Illinois Marriage and Dissolution of Marriage Act (Act) (750 ILCS 5/503 (West 1994)), Marilyn acquired the Petunia property in exchange for the Merrill property, a nonmarital asset. Thus, the trial court classified the Petunia property as nonmarital property and awarded it to Marilyn.

Alfred contends on appeal that the trial court erred in finding that the Petunia property was Marilyn's nonmarital property. Specifically, Alfred argues that (1) the Petunia property is presumed to be marital property because it was acquired during the marriage; and (2) the presumption can only be overcome by clear and convincing evidence, which Marilyn did not establish. Marilyn argues that she overcame the presumption and that the trial court did not err in awarding her the Petunia property as nonmarital property.

In order to distribute property upon dissolution of marriage, a trial court must first classify that property as either marital or nonmarital. In re Marriage of Jelinek, 244 Ill. App. 3d 496, 503, 184 Ill. Dec. 692, 613 N.E.2d 1284 (1993). The trial court's determination that an asset is nonmarital property will not be disturbed on appeal unless that determination is against the manifest weight of the evidence ( Jelinek, 244 Ill. App. 3d at 503) because that determination rests largely on the trial court's evaluation of the credibility of the witnesses ( In re Marriage of Werries, 247 Ill. App. 3d 639, 641, 186 Ill. Dec. 747, 616 N.E.2d 1379 (1993)).

The distribution of property from a dissolution of marriage is governed by sections 503(a) and (b) of the Act. 750 ILCS 5/503(a), (b) (West 1994). The Act states in pertinent part:

"(a) For purposes of this Act, 'marital property' means all property acquired by either spouse subsequent to the marriage, except the following, which is known as 'non-marital property':

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(2) property acquired in exchange for property acquired before the marriage or in exchange for property ...


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