APPEAL FROM THE CIRCUIT COURT OF COOK COUNTY No. 08 D 230261 HONORABLE JOHN T. CARR, JUDGE PRESIDING.
The opinion of the court was delivered by: Justice Steele
JUSTICE STEELE delivered the judgment of the court, with opinion. Presiding Justice Salone and Justice Neville concurred in the judgment and opinion.
¶ 1 Respondent, John J. D'Attomo, appeals from the judgment of the circuit court of Cook County dissolving his marriage to petitioner, Betsy J. D'Attomo. John argues that the trial court erred in: (1) ruling that the home equity loan funds were an investment in a bakery started during the marriage, rather than a loan to the business; (2) awarding Betsy rehabilitative maintenance without requiring that she seek gainful employment or maintain employment commensurate with her education, experience and training; (3) failing to deem martial funds Betsy spent on attorney fees and litigation expenses as an advance against her share of the marital estate; (4) calculating the value of the bakery; (5) applying an incorrect standard to his claim that Betsy dissipated marital property; and (6) ordering a "true-up" payment and contribution to Betsy's attorney fees. For the following reasons, we affirm.
¶ 3 The record on appeal discloses the following facts. The parties married on June 15, 1996, in Park Ridge, Illinois. The parties were married for 11 years when Betsy petitioned for a dissolution of the marriage. Betsy and John have two children, a son born in 1999 and a daughter born in 2002. Child custody is not at issue in this case.
¶ 4 Both parties were licensed and practicing attorneys prior to their marriage. Betsy earned a bachelor's degree in business administration in 1990 and a juris doctor degree in 1993. Following her graduation from law school, Betsy was admitted to the Illinois bar and initially worked full time as a tax consultant for Arthur Anderson. Betsy then joined the law firm of Sonnenschein Nath & Rosenthal as an associate, where her practice concentrated on employee benefits and executive compensation law. Betsy earned in excess of $70,000 annually at the firm. In late 1996, Betsy joined the benefits consulting firm of Hewitt Associates, where she worked as a consultant until January 2000, earning close to $80,000 annually.
¶ 5 After the birth of the parties' first child, by agreement of the parties, Betsy stopped practicing law. From 2000 through 2006, Betsy was primarily a stay-at-home mother, but worked part-time operating a house painting business and selling Mary Kay cosmetics. Betsy testified that she did not like practicing law.
¶ 6 Betsy also baked, first for herself, then for her friends. Betsy started a bakery called Baked by Betsy, Inc., working part-time in 2006 and full-time starting in 2007. John drafted the documents to establish the business as a limited liability company and issued stock.
¶ 7 The bakery reported losses for the tax years 2007 and 2008. At the time of trial it was likely the bakery would also report a loss for 2009. Betsy took no salary from the bakery in 2006-08, but began taking a weekly salary of $200 before the trial.
¶ 8 On at least three occasions, the parties loaned money to the bakery business: (1) $3,000 in February 2006; (2) $3,000 in May 2006; and (3) $10,000 in March 2008. These loans were evidenced by written promissory notes. The February 2006 loan was repaid.
¶ 9 The parties also advanced money ultimately totaling $201,500 to the bakery business by taking a home equity loan against the marital residence. John testified that the money from the home equity loan constituted a loan to the business, to be repaid by the time their eldest child was ready to enter college. Betsy testified that it was an equity investment. John testified that when the couple took out the home equity loan, Betsy said she could always get a job with her friend and accountant, Sandra Burkett, to repay it. The bakery's tax returns and financial statements, as well as a "year one pro forma" sheet itemizing anticipated costs and expenses of the bakery business created by Betsy and Burkett, characterize these funds as a loan. However, Burkett testified that it was beneficial to categorize the funds as a loan for tax purposes and she had not made any independent assessment of whether the funds were in fact a loan or equity. Burkett also testified that the pro forma projections for the business reflected the assumption the parties would borrow from a bank or others.
¶ 10 In August 2007, Betsy obtained a $30,000 loan for the business from Burkett. The promissory note (Burkett note) states that the loan is between the bakery or Betsy and Burkett; Betsy's signature does not indicate it was made in her corporate capacity. Betsy testified that she discussed this loan with John. Betsy testified that this loan is being repaid from the bakery's business account.
¶ 11 Michael Mattson, a business appraiser employed by the Griffing Group, testified for Betsy as an expert witness on the valuation of the bakery business. After finding the asset and income approaches unsuitable to the case, Mattson valued the bakery business at $69,000. This valuation assumed that the Burkett note was a liability of the business. Mattson did not consider the home equity loan a debt of the bakery business. Mattson explained that a regular debt would be evidenced by a note between the business and the lender. Mattson also noted that the home, rather than the business, was the collateral for the home equity loan. John did not present expert testimony on the valuation of the bakery business.
¶ 12 John practiced law at the firm of Gardner, Carton & Douglas and eventually became a partner. However, John was laid off from his employment in May 2009. He thereafter obtained full-time employment as an attorney, albeit earning approximately half of his former salary. In July 2010, John's employer changed his compensation structure such that he no longer received fixed compensation. On February 17, 2011, following the judgment appealed from, the circuit court entered ...