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In re Marriage of Rivera

Court of Appeals of Illinois, First District, Fourth Division

September 30, 2016

In re MARRIAGE OF JUAN A. RIVERA, Petitioner-Appellee, and MELISSA SANDERS-RIVERA, Respondent-Appellant.

         Appeal from the Circuit Court of Cook County, No. 14 D 4873 Honorable Carole Kamin Bellows, Judge Presiding.

          JUSTICE HOWSE delivered the judgment of the court, with opinion. Justices McBride and Burke concurred in the judgment and opinion.

          OPINION

          HOWSE JUSTICE

         ¶ 1 This appeal comes to the court on a certified question concerning whether the proceeds of petitioner's settlement of a lawsuit for a wrongful conviction is marital property for purposes of distributing a marital estate. The court certified the following question:

"Whether the settlement proceeds received from a wrongful conviction action are marital property when (a) the coerced confession and initial conviction occurred before the marriage, and (b) the conviction was reversed during the marriage."

         ¶ 2 For the following reasons, we answer the certified question in the affirmative and find the settlement proceeds in this case are marital property because the lawsuit accrued during the marriage.

         ¶ 3 BACKGROUND

         ¶ 4 The circumstances that led to this appeal stem from petitioner's conviction in 1993 for murder. Petitioner was incarcerated from the time of his arrest in 1992 until January 2012, after his conviction was reversed by the appellate court. While petitioner was incarcerated, he and respondent got married on October 31, 2000. After his release from prison in 2012, petitioner filed a petition for dissolution of marriage from respondent in 2014. In March 2015, petitioner settled his lawsuit for $20 million, of which petitioner will receive approximately $11.36 million.

         ¶ 5 Petitioner subsequently filed a motion for summary judgment in the dissolution case arguing that the settlement proceeds are his own separate property, not marital property. Respondent filed a motion for a declaratory judgment that the proceeds are marital property and specifically that the portion of the proceeds that were awarded for the defamation of character count in petitioner's lawsuit are marital property. The trial court certified for appeal the issue of whether the settlement proceeds are marital property.

         ¶ 6 The facts of petitioner's conviction are of limited relevance to the issue in this appeal, so we will limit our discussion of those facts to those that are germane. Petitioner was charged with first degree murder in 1992. People v. Rivera, 333 Ill.App.3d 1092, 1093 (2002). The victim had been raped and stabbed multiple times. Id. at 1093-94. The evidence against petitioner included incriminating statements to police and a signed confession. Petitioner maintains these statements were coerced. In 1993, following a jury trial, petitioner was convicted and sentenced to natural life imprisonment without the possibility of parole. Id. at 1093. He appealed, and his conviction was reversed and the cause remanded for a new trial. Id. A second jury trial commenced in 1998. Id. at 1094. The jury again found petitioner guilty and the court sentenced him to natural life imprisonment without the possibility of parole. Id. at 1100.

         ¶ 7 Petitioner appealed the 1998 verdict and sentence, and in 2002 the appellate court affirmed. Id. at 1104. In 2004 the circuit court of Cook County granted petitioner's motion for DNA testing of material taken from vaginal swabs of the victim. People v. Rivera, 2011 IL App (2d) 091060, ¶ 4. As a result of those tests the circuit court of Cook County granted petitioner relief from judgment. Id. ¶ 4. A new jury trial commenced in 2009. Id. ¶ 5. The record shows that at the time of the murder, petitioner was already under arrest for a minor offense and as a result had been released from custody on electronic home monitoring. Despite evidence from the home monitoring system, which indicated that petitioner could not have committed the murder because he was at home at the time of the murder, he was unfortunately convicted again by a jury and the court sentenced him to natural life imprisonment without the possibility of parole. Id. ¶ 22.

         ¶ 8 In 2011, the appellate court reversed petitioner's conviction. Id. ¶ 46. Petitioner left prison in 2012.

         ¶ 9 On October 30, 2012, petitioner filed a complaint under section 1983 of the United States Code alleging violations of his civil rights under color of law. Petitioner alleged various theories of recovery based on his wrongful conviction against numerous defendants including Lake County, various local governments, and members of the Illinois State Police (hereinafter, the lawsuit). On May 23, 2014, petitioner filed a petition for dissolution of marriage, and on July 3, 2014, respondent filed a counter-petition for dissolution.

         ¶ 10 On May 21, 2015, petitioner filed a motion titled "Motion for Partial Summary Judgment Regarding Petitioner's Non-Marital Settlement Funds." Petitioner's motion asserted that the entire settlement for his lawsuit "was based on the torts in his Complaint that arose out of his wrongful incarceration and conviction which were derived from conduct that occurred in 1992." Petitioner asserted that the lawsuit "was the result of conduct which led to his wrongful conviction prior to the marriage." Petitioner also alleged that he received a Certificate of Innocence (COI) from the State of Illinois and recovered approximately $213, 000. Petitioner sought a partial summary judgment that the settlement proceeds from his lawsuit and his remaining COI funds are his nonmarital property. In support of his motion for summary judgment petitioner attached an affidavit by Steve Art, one of petitioner's attorneys representing him in the lawsuit. Art averred that he was involved in all aspects of the settlement negotiations and the "entire settlement was based on the torts in his Complaint that arose out of his wrongful incarceration and conviction which were derived from conduct that occurred in 1992 (Counts I, II, III, IV, V, VI, VII, VIII, and IX)."

         ¶ 11 On May 27, 2015, respondent filed a motion titled "Motion for Declaratory Judgment that Civil Rights Lawsuit and Settlement Proceeds Therefrom are Marital Property." Respondent asked the trial court to find that the lawsuit is marital property "because it could not have been filed unless and until the conviction was overturned." Respondent noted petitioner made that same argument to the United States District Court for the Northern District of Illinois in response to a motion to dismiss his lawsuit. Respondent argued the lawsuit did not become property until the conviction was reversed in 2011, after the parties were married; and the lawsuit is marital property because the lawsuit accrued during the marriage. In her reply to petitioner's response to respondent's motion for declaratory judgment, respondent argued that the settlement petitioner received included a settlement for a defamation claim included in the lawsuit. The defamation claim was in Count X of the lawsuit. Respondent argued that the defamation claim was based on statements made during the marriage and, therefore, petitioner "cannot properly claim the defamation count is anything but marital property." The defamation claim was based on an article appearing in the New York Times in 2011, during the parties' marriage.

         ¶ 12 Pursuant to an agreed order, petitioner filed a supplement to his motion for partial summary judgment and an amendment to Art's affidavit. Petitioner's supplement to the motion for partial summary judgment asserted the defamation claim had no impact on or value in the overall settlement of $20 million. Petitioner also alleged the defamation claim was never discussed in settlement negotiations. Petitioner pointed out that seven defendants were able to agree to a settlement as a whole even though only two were the subject of defamation claims, and he argued that this was "because the defamation claim did not factor into the settlement amount." In the amended affidavit Art averred as follows:

"The defamation claim in [petitioner's] civil lawsuit had no impact on or value in the overall settlement of $20 million. Indeed, during settlement negotiations with the defendants in the civil lawsuit, the defamation claim was never even discussed. Moreover, the group of seven (7) defendants was able to agree to a settlement as a whole (even though two (2) of the defendants had defamation claims against them while the rest did not) because the defamation claim did not factor into the settlement amount. The defamation claim did not factor into or increase the settlement to [petitioner.]"

         ¶ 13 In August 2015 respondent filed a motion titled "Motion to Strike Affidavits of Steve Art." Respondent argued Art's averment that all defendants were able to reach a settlement as a whole, despite only two having defamation claims against them, is not supported by a statement that Art has knowledge the defamation claim had no effect on the amount paid by the defendants who did have a defamation claim against them. Art offered no facts to indicate how any of the defendants were able to agree on the settlement amount and offered no facts for the conclusion the defamation count was not included in their determination. Moreover, one defendant subject to the defamation count negotiated separately, and Art offered no facts for his conclusion the defamation claim was not considered in that defendant's agreement to a settlement amount. Respondent further argued that each relevant settlement agreement (with the defendants subject to the defamation claim) stated petitioner was releasing every claim against the defendant, which necessarily included the defamation claim. She further argued each agreement contains an integration clause indicating the parties "specifically agreed that the agreements would be interpreted solely according to the language in the agreements." Respondent argued that Art's affidavits are contrary to the plain language of the settlement agreements and are irrelevant and inadmissible. She stated they are nothing more than Art's opinion as to how the settlement agreements should be construed.

         ¶ 14 Respondent argued that because Art admitted that the defamation claim was not discussed during negotiations Art has no factual basis to conclude the defamation claim had no impact on the amount of the settlement. Respondent argued "Art is offering as a fact what in reality is merely his subjective opinion, again because Art never even discussed the defamation claim with the defendants during the settlement negotiations." She asserts there are no facts to support the conclusion the defamation claim had no impact on the amount of the settlement. Respondent further replied that the court must first determine whether Art's affidavits comply with Rule 191 before she is required to submit counter-affidavits. Regardless, she is not required to submit counter-affidavits because Art's statement that the defamation claim did not influence the amount of the settlement is refuted by the documents attached to the affidavits in that the settlement documents state the settlement was for a release of all claims including the defamation claim. Respondent argued she is allowed to rely on the contradiction between the affidavits and the documents attached thereto to create a genuine issue of material fact. She asserts the "dismissal of the defamation claim was part of the expressed consideration in the written settlement agreements in exchange for which [petitioner] received $14.5 million dollars."

         ¶ 15 The trial court found that given Art's first-hand experience and involvement in the case, he "is qualified to testify to the facts concerning the settlement meetings and final settlement." The court ruled that Art's affidavits were made based on the personal knowledge of the affiant and do not set forth legal conclusions or opinions without stating supporting facts. "Rather, Art's Affidavits, as a whole, are based upon his personal knowledge of [petitioner's] case and personal involvement in the settlement negotiation process. Thus, there is a reasonable inference that Art could competently testify to the contents of his Affidavit at trial." The court held the affidavits satisfied Rule 191 and denied respondent's motion to strike.

         ¶ 16 Subsequently, the trial court granted petitioner's motion for partial summary judgment that his settlement proceeds and remaining COI funds are his nonmarital property, and denied respondent's motion for declaratory judgment. The court turned first to whether a genuine issue of material fact exists. The court rejected respondent's argument the settlement documents contradict Art's affidavits. The court reasoned: "Art's affidavits provide testimony regarding how the parties arrived at the value of the released claims. The settlement documents, in contrast, do not set forth information relating to how the parties arrived at the value of the released claims. Thus, the settlement agreements themselves do not contradict Art's affidavits." The court took as true the statements in Art's affidavits regarding the basis for the settlement, specifically noting that respondent failed to file a counter-affidavit.

         ¶ 17 Turning to the classification of the settlement proceeds, the trial court found that no cases presented the exact factual situation present here, but that this case could be analogized to cases that address characterization of traditional personal injury claims as marital or nonmarital property. The court wrote as follows:

"[F]or purposes of property characterization in the present divorce action, the Court will regard [petitioner's] lawsuit and settlement proceeds therefrom as no different than other personal injury lawsuits involving injuries that occurred before marriage. In such cases, the claim remains non-marital, regardless of whether the lawsuit is brought or the settlement is paid during the marriage."

         ¶ 18 Nonetheless, the court later noted that the "differentiation between the simultaneous timing of cause of action and injury in most tort cases, and, [petitioner's] inability to assert his cause of action simultaneously with his injury, is what causes this to be an issue of first impression for this Court." The court rejected respondent's claim the settlement (or at least a portion of it) was marital property because the defamation claim was based on events that occurred during the marriage by relying on Art's affidavits that the defamation claim did not factor into the settlement. Next, the court found persuasive a ruling in a proceeding related to this case in which the appellate court found that the insurance carrier for one of the defendants in petitioner's lawsuit at the time of petitioner's release was not responsible to provide coverage for petitioner's damages.

         ¶ 19 The trial court found that the injuries that gave rise to the lawsuit occurred or were based on events that occurred prior to the date of marriage, and, based on Art's affidavits, the entire settlement was based on torts that arose from conduct that occurred prior to the marriage. The court ruled that petitioner established that there is no genuine issue of material fact as to the ...


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