Appeal from the Circuit Court of Cook County Illinois, No. 99 D 06640 The Honorable Raul Vega, Judge Presiding.
The opinion of the court was delivered by: Justice Joseph Gordon
JUSTICE JOSEPH GORDON delivered the judgment of the court, with opinion. Justices Smith and Howse concurred in the judgment and opinion.
Respondent Patricia Anderson appeals from an order from the circuit court of Cook County terminating her maintenance and denying her petition for rule to show cause for indirect civil contempt. Respondent contends that the trial court erred in terminating her maintenance because petitioner James Anderson failed to establish the existence of a substantial change and that, in any event, petitioner has sufficient income and assets to continue to pay maintenance to respondent, while respondent is financially dependent. In addition, respondent contends that the court erred in not finding petitioner in contempt for his noncompliance with the court's previous order denying petitioner's motion to modify maintenance. While the trial court properly found that petitioner showed a substantial change in circumstances since the entry of the previous order on maintenance, it erred in taking into account respondent's eligibility for public assistance when determining whether maintenance should be terminated.
Respondent and petitioner were married on February 3, 1951. On November 4, 1988, a judgment of dissolution of marriage, which incorporated a marital settlement agreement, was entered by the superior court of the State of California, County of San Diego, and on June 1, 1992, that judgment was enrolled in the circuit court of Cook County. At the time the judgment was entered, the parties had been married for 37 years and had no minor children. Also at that time, petitioner was self-employed in sales and expected to a net income of $105,000 for the year of 1988. Respondent was unemployed and had no income from wages or business.
Pursuant to the judgment, petitioner was awarded a vacation home located in Minoqua, Wisconsin, one half of the proceeds from the sale of the marital home located in San Diego, California and six individual retirement accounts (IRAs) held in his name. Respondent was awarded one-half of the proceeds from the marital home, four IRAs held in her name, Southwestern Bell bonds, and an equalization payment in the amount of $8,483 to be paid from petitioner's share of the proceeds from the marital home. In addition, the judgment awarded an equal division of petitioner's retirement account from McGraw-Hill Publishers pursuant to a qualified domestic relations order. Lastly, respondent was awarded spousal support in the sum of $3,000 per month continuing "until the death of either party, the remarriage of the wife, or further court order."
In early 1992, petitioner sought to modify his maintenance payments to respondent, and although the record does not contain the disposition on that matter, the parties agree that in 1992 the superior court of California reduced respondent's spousal support to $950 per month. On April 28, 1999, respondent filed a petition in the circuit court of Cook County for rule to show cause against petitioner for his failure to make spousal support payments to respondent in accordance with the modified order from the superior court of California in 1992, and for failure to pay respondent her share of the McGraw-Hill retirement benefits. On July 22, 1999, petitioner filed a petition in the circuit court of Cook County to further modify maintenance, in which he sought termination of his maintenance obligations and attested that since the entry of the order from the superior court of California, there had been a material change in his circumstances such that he was financially unable to meet that obligation. In support of that contention, petitioner stated that he was 70 years of age at that time and that his income declined when he retired in 1994. At that time, petitioner's son took over his sales accounts and paid petitioner a monthly stipend of $1,000. Petitioner contends that in 1997 his income was further reduced when his son was involuntarily terminated from petitioner's business and could no longer pay that stipend. Petitioner's asset disclosure statement, which was disclosed in connection with those proceedings, revealed a gross income of $36,000 for 1998, and $15,000 through May 1999.
On August 26, 1999, respondent filed her own petition in which she sought to increase her maintenance award and averred that since the entry of the order from the superior court of California, her monthly expenses had significantly increased and she had insufficient income to defray her basic living expenses. Respondent stated that she was 72 years of age at that time and that her only sources of income were her social security benefits and interest income, which amounted to $700 per month. On October 12, 1999, the circuit court of Cook County entered an order denying both petitioner's and respondent's petitions for modification and ordering petitioner to recommence his monthly payments to respondent in the amount of $950.
On October 1, 2004, respondent filed a "petition for entry of [a] withholding order or in the alternative automatic withdrawal from [petitioner's] checking account for payment of monthly maintenance obligation." Subsequently, on December 28, 2004, the trial court entered an amended agreed order, which provided that petitioner's maintenance payments would be made directly from his Morgan Stanley account by the fifth day of each month.
On December 31, 2008, petitioner filed a motion to terminate respondent's right to receive maintenance, in which he attested that since the entry of the trial court's order on October 12, 1999, he had "lost a great deal of his retirement savings in the Stock Market Decline during the year 2008," and that his health issues and advanced age prevented him from working. He further attested that his only sources of income were a small annuity and his social security benefits. On August 21, 2009, respondent filed a new petition for rule to show cause for indirect contempt against petitioner in which she alleged that she had not received any maintenance payments since January, 2009.
A hearing on petitioner 's motion to terminate respondent's maintenance and respondent's petition for rule to show cause was held on December 16, 2009. At that hearing, petitioner testified that he was 80 years old and unemployed, and that, due to his health-related issues, he was unable to go back to work. He acknowledged that he was already unemployed in 1999, when the court entered its prior order denying his petition to modify maintenance. Petitioner further testified that he retired in 1994, and that at time, his son took over his business in selling advertising and magazines. According to petitioner, he received a stipend of $1,000 per month from his son from the time he retired until 1996, at which time his son was involuntarily terminated from petitioner's business and could no longer make those payments. Petitioner averred that as of the time of that hearing, his sources of income consisted only of draws from his Morgan Stanley account in the amount of $1,600 per month, a "retirement check" from McGraw-Hill for $134 per month and social security benefits in the amount of $1,600 per month. According to petitioner, he withdraws $2,000 per month from his Morgan Stanley account, leaving him with $1,600 after taxes. Petitioner admitted that his social security benefits have increased from $1,200 in 1999. Petitioner also acknowledged that his current wife receives $400 per month from a Teamster's pension and $300 per month in social security benefits, which is used for her own personal expenses and for the couple's discretionary spending, such as gifts for children and grandchildren. In addition, petitioner testified that he has a whole life insurance policy worth $7,000 to cover the cost of his burial. According to petitioner, his life-style has "gone down," that he no longer belongs to clubs, does no "extra spending," and is "just paying the bills on the Wisconsin house and the Illinois house. He acknowledged, however, that he made charity donations of $110 a month in 2008.
Petitioner testified that when he filed a petition to modify maintenance in 1999, his Morgan Stanley retirement account was worth between $200,000 and $225,000. According to petitioner, as of May 2009, the value of that account had decreased to $77,500, and that on the date of the hearing, his retirement account was worth $63,000. In support of that assertion, petitioner introduced into evidence a monthly summary of his Morgan Stanley retirement account from January 2008, through May 2009. That summary shows that the value of that account was $158,403.52 in January, 2008, and $77,503.09 in May, 2009. It is also apparent from the summary that the "change in value" of the account was negative for 13 of the 17 months reported, which shows a decline in value that was not due to cash withdrawals. The cash withdrawals reported in the summary remained constant throughout most of that period, at $3,700 during most months, with an increase from November 2008 to January 2009, and a decrease to $2,190 afterwards. Petitioner further testified that when the market declined in 2008, he removed the remaining funds in his retirement account from the "market" and invested them in cash and government securities. Petitioner acknowledged that in January 2009, he instructed Morgan Stanley to cease withdrawing the $950 monthly payment for respondent. Petitioner averred that the remaining funds in his retirement account will last for approximately two years, at which point, he stated, "I hope I'm dead," because he will have no source of income than social security benefits.
In addition, respondent introduced into evidence petitioner's asset disclosure statements, which show that petitioner's income was $36,000 in 1998, $15,000 from January through May 1999, $42,792 in 2007 and $43,000 in 2008. In addition, petitioner's income tax returns for 2007 and 2008 show that the joint adjusted income of petitioner and his current wife was $58,755 in 2007, and $68,251 in 2008. According to petitioner, his portion of the income shown in his joint income tax returns attributable to him consists of his social security benefits and withdrawals from his Morgan Stanley account. Further, petitioner testified that he had not done his taxes for the year 2009 at the time of the hearing, but averred that his financial support consists of the $1,600 monthly withdrawal from his retirement account, the $134 monthly check from his McGraw-Hill retirement fund and $1,600 monthly payment in social security benefits.
Petitioner further testified that he currently owns a residence in Chillicothe, Illinois, which he believed to have a resale value of $80,000, but averred that a similar home in the same general location was valued at $69,500. However, respondent introduced into evidence an appraisal report obtained in 2008 when he sought to refinance the home, which purported to value the residence at $170,000 as of April 8, 2008. According to petitioner, the mortgage on that residence is $32,500, and his monthly payments on that mortgage is $318.
Additionally, petitioner testified that he continues to own the home in Minocqua, Wisconsin, which was awarded to him pursuant to the divorce judgment in 1988, and that he pays approximately $3,300 per year in property taxes on the home. Petitioner believes that the home is currently worth approximately $200,000, and acknowledged that it was valued at $365,124 by the tax assessor's office in 2008, before the market declined. Correspondingly, respondent introduced into evidence a document titled "Vilas County Tax Data" which showed the fair value of petitioner's Wisconsin home as $365,124 in 2008.*fn1 According to petitioner, he had no intentions of selling either one of the two residences and intends to leave the home in Wisconsin for his children.
Respondent testified that her only investment asset is an account held with Chase Bank and that she also has a checking account at that bank. While respondent acknowledged that her Chase investment account was worth $91,999.42 as of May 31, 2009, she testified that as of the date of the hearing, that account was valued at around $70,000 to $75,000, and that her checking account had a balance of $3,454. Respondent further testified that she receives $754 per month in social security benefits, which is deposited directly into her checking account. In regard to respondent's available funds, petitioner introduced into evidence respondent's Chase account statements, which show an ending balance of $73,593.51 at the end of September, 2009.
Respondent also testified that she resides in an assisted living facility in Algonquin, Illinois, and pays monthly fees in the amount of $2,000 directly from her account. Respondent stated that had been previously living in another assisted living facility where she had been paying $4,000 per month, but has moved into a less expensive facility. Respondent currently draws about $2,700 per month from her accounts to pay for her housing and other expenses. Respondent also testified that she has been told that the state will pay for her living expenses at the facility where she currently resides after the funds in her Chase investment account are depleted. Further, respondent testified ...