The opinion of the court was delivered by: Presiding Justice Hartman
Appeal from the Circuit Court of Cook County. Honorable Richard S. Kelly, Judge Presiding
Respondent Theodore LaFeber, III (Ted) appeals from certain provisions of a reconsidered judgment for dissolution of marriage entered in the circuit court of Cook County on September 28, 1999, and from a memorandum order and opinion entered in connection with the reconsidered judgment on August 6, 1999. On appeal, Ted raises multiple issues, contending that the court abused its discretion in its award of attorney and expert fees and costs, and refusing to readjust and reallocate its division of marital assets and liabilities after correcting an initial error in the categorization and award of a 1997 income tax refund.
Ted also moved to set bond on October 25, 1999, to stay enforcement of the money judgment for attorney fees. The circuit court initially set the supersedeas bond for $675,000 on December 3, 1999, to cover the entire amount of the judgment; however, Ted successfully moved to reduce the bond in this court on the basis that the only money judgment issue he would appeal related to the award of attorney fees and expert fees amounting to $83,500. Approval of the bond, reduced to $150,000 to cover those obligations, was granted on May 18, 2000. After Ted's brief was filed with this court, petitioner Francesca Suriano (Francesca) moved to strike the second section of his brief, alleging that because the supersedeas bond covered only the amount of attorney fees and expert fees, Ted could not raise the argument on appeal for readjustment and reallocation of the 1997 income tax refund, contained in point II. On June 16, 2000, an order was entered to take the motion with the case.
The issues presented on appeal include whether the circuit court abused its discretion (1) in its award of attorney and expert fees and costs to Francesca; and (2) in its allocation and nonadjustment of a 1997 income tax refund.
Francesca and Ted were married on May 27, 1990, in Chicago, and have two minor children from the marriage. They separated on or about July 17, 1997. On September 2, 1997, Francesca petitioned for dissolution of marriage. Ted responded and filed a counter-petition for dissolution of marriage on October 10, 1997. Francesca filed a response to the counter-petition on November 4, 1997.
Thereafter, the case moved through discovery, raising questions of valuation of Ted's business interests, dissipation of assets, maintenance, child support and other contested matters. Trial commenced on June 24, 1999. On July 29, 1999, the circuit court heard closing argument, the focus of which dealt with the issue of whether Ted's business interests would be deemed marital property. The court took the matter under advisement and thereafter ordered, inter alia, that petitions for contribution to attorney fees were to be filed before August 10, 1999, and that the judgment for dissolution of marriage would not be entered until resolution of the contribution issue.
On August 6, 1999, the circuit court issued a written memorandum opinion, findings, conclusions and order following trial on the issue of dissolution. The memorandum opinion made findings as to both valuation and division of the property, and expressly stated that it was "not a final order and is to be superseded by the judgment of dissolution to be entered herein. Pending entry, enforceability, and effectiveness of such judgment, all temporary orders shall continue." The court ruled that Ted's interests in the family businesses constituted marital property, and awarded Francesca $608,017, being 40.91% of the marital estate. Ted was awarded with $878,171, or 59.09% of the total value of marital property. Also, the court found that a 1997 income tax refund (tax refund) was an asset of the estate, which it awarded to Ted.
The memorandum opinion anticipated the adjudication of fee contribution petitions and its impact on the division of property by the circuit court prior to the entry of judgment for dissolution of marriage; it expressly provided that hearings for the petitions for contribution were to be scheduled for a date prior to the entry of judgment and draft judgments of dissolution in conformity with the memorandum were to be submitted leaving provision for inclusion of a section 503(j) (750 ILCS 5/503(j) (West Supp. 1999) (section 503(j))) contribution pursuant to the Marriage and Dissolution of Marriage Act (750 ILCS 5/101 (West 1998) (Act)).
Francesca petitioned for contribution to attorney and expert fees and costs on August 10, 1999, seeking payment totaling $151,534, pursuant to section 503(j) of the Act, contending that because Ted received a disproportionate share of the marital estate and was awarded a business interest that would continue to generate significant income, Ted should pay for her attorneys' and experts' fees and costs. Ted filed his petition for contribution to attorney fees the same day, under sections 508(a) and (b) (750 ILCS 5/508(a) and (b) (West 1998) (section 508(a))) of the Act. Ted's petition claimed, in relevant part, that Francesca was obligated to contribute to the payment of his attorneys' fees due to her own conduct throughout the divorce proceedings, which included a finding of contempt of court and sanctions. In her response to Ted's petition, Francesca denied Ted's substantive allegations and argued that the circuit court was obliged to make any and all fee determinations under the considerations of section 503 (750 ILCS 5/503 (West Supp. 1999) (section 503)). Ted, in his response to Francesca's petition, denied that section 503 trumps section 508 (750 ILCS 5/508 (West 1998) (section 508)) and, as a result, limits the court in terms of what factors and criteria may be considered with respect to fee petitions. Ted contended that an evidentiary hearing mandatorily was required and demanded such a hearing on the outstanding fee issues. On September 2, 1999, the court conducted a hearing on the petitions for contribution for attorney fees. *fn1
During the hearing, Ted reasserted the arguments made in his written pleadings challenging the reasonableness of Francesca's request for fees and continued to demand that the circuit court conduct an evidentiary hearing for the post-trial fee dispute, noting the unfairness of paying additional sums to Francesca's estate when his award primarily consisted of liquid assets. Finally, Ted sought to make an offer of proof with regard to pre-trial settlement negotiations to resolve the fee dispute.
After lengthy argument by both parties, the circuit court rejected Ted's offer of proof of settlement negotiations and found that section 503 did not mandate an evidentiary hearing for attorney fees. Further, the court denied Ted's petition and granted Francesca's petition to the extent that it ordered Ted to contribute from his share of the marital estate the aggregate sum of $93,491 toward Francesca's attorneys' and experts' fees and costs. The aggregate sum amounted to 75% of the 82% balance owed to Francesca's attorneys and expert witnesses. The court also rejected Ted's request that the fee award be handled on a percentage basis of fees actually and unilaterally paid by Francesca, as opposed to fees billed but unpaid at the time of the hearing and decision.
On September 3, 1999, the circuit court heard further argument concerning the specific language sought by each party in the forthcoming judgment for dissolution of marriage. The parties discussed scheduling a hearing on any post-trial motions that either party may file pursuant to section 2-1203 of the Code of Civil Procedure (735 ILCS 5/2-1203 (West 1998) (section 2-1203)), seeking clarification, reconsideration or modification of the judgment. The court entered an order providing for the judgment on the fees and set a hearing for September 13, 1999, for any post-trial motions to be filed.
The judgment for dissolution of marriage was entered on September 7, 1999, and included the circuit court's findings on the petitions for contribution to attorney fees, specifically acknowledging the hearing on Francesca's and Ted's petitions for contribution pursuant to section 503 on September 2, 1999, and that Ted was obliged to pay Francesca a total of $93,491 for attorney and expert fees and costs. Attached to the judgment was the court's memorandum opinion. Certain paragraphs of the judgment specifically made reference to the memorandum opinion although the judgment did not expressly incorporate it.
On September 9, 1999, each party filed a section 2-1203 motion seeking reconsideration of the judgment. Ted alleged five circuit court errors in the judgment, including (1) the failure to conduct an evidentiary hearing; (2) the findings and order pertaining to the tax refund; (3) the refusal to consider evidence of settlement offers when hearing the cross-petitions for attorney fees; (4) the classification of Ted's business interests as marital property; and (5) the failure to adjust the property settlement after ordering Ted to contribute to Francesca's attorneys' fees. Francesca's motion for reconsideration sought certain findings pertaining to the nondischargeability in bankruptcy by Ted of the awards of property to Francesca under the judgment, including the attorney and expert fees contribution award.
On September 13, 17 and 22, 1999, the circuit court heard extensive argument on the section 2-1203 motions. Thereafter, the court entered a supplemental order on September 28, 1999, which clarified and modified the September 7, 1999 judgment for dissolution of marriage. Also on September 28, 1999, the court entered a reconsidered judgment for dissolution of marriage (reconsidered judgment), in which the court took the findings contained in the four-page supplemental order and rewrote the court's September 7, 1999 judgment to include the modifications.
The supplemental order granted Francesca's request for findings pertaining to Ted's nondischargeability in bankruptcy of the property awarded to her, including attorney fees. The circuit court found that Ted's tax refund was of no value to him, nor an asset of the estate and, as a result, the reconsidered judgment reflected a deletion of the tax refund as a marital asset and as an award to Ted, but not an adjustment of the parties' total awards. Similar to the September 7, 1999 judgment, the reconsidered judgment also required Ted to pay $93,491 for Francesca's attorneys' and experts' fees and costs. Lastly, the court denied all other relief not otherwise granted therein to Francesca and denied all other relief sought by Ted.
Ted's notice of appeal dated October 25, 1999, was filed by additional counsel, separate from counsel that appeared at the September 2, 1999 contribution hearing. Ted appeals from the reconsidered judgment with regard to the circuit court's findings as to marital property, dissipation, the tax refund, contribution to attorney fees and, expanding on the foregoing assertions of abuse of discretion, he appeals the entire reconsidered judgment and memorandum opinion. *fn2
On May 10, 2000, Francesca moved to strike section II of Ted's brief, which seeks review of the circuit court's reclassification and nonadjustment of the tax refund. In her motion to strike, Francesca alleges that Ted should be barred from reasserting an issue on appeal which he had abandoned after he obtained a reduced supersedeas bond. On June 16, 2000, ...