In re Carstens

• Decision Date: 30 March 2018
• Docket Number: No. 2–17–0183,2–17–0183
• Parties: IN RE MARRIAGE OF Sue CARSTENS, Petitioner–Appellee, and John Carstens, Respondent–Appellant.
• Court: United States Appellate Court of Illinois

2018 IL App (2d) 170183

101 N.E.3d 181

IN RE MARRIAGE OF Sue CARSTENS, Petitioner–Appellee,

and

John Carstens, Respondent–Appellant.

No. 2–17–0183

Appellate Court of Illinois, Second District.

Opinion filed March 30, 2018

Drake James Leoris and David Drenk, of Leoris & Cohen, P.C., of Highland Park, for appellant.

Joel Ostrow, of Bannockburn, for appellee.

PRESIDING JUSTICE HUDSON delivered the judgment of the court, with opinion.

¶ 1 Respondent, John Carstens, appeals from an order of the circuit court of Lake County granting in part and denying in part his amended petition to terminate or, alternatively, reduce the maintenance awarded to his ex-wife, petitioner, Sue Carstens. We affirm in part, reverse in part, and remand with directions.

¶ 2 I. BACKGROUND

¶ 3 Petitioner and respondent were married in 1986. Three children were born to the parties during the marriage. The parties separated on May 7, 2001, and petitioner subsequently filed a petition for dissolution of marriage. On December 6, 2004, the trial court entered a judgment of dissolution of marriage. At the time of the dissolution, both parties were 49 years old. Petitioner worked as a full-time homemaker while respondent was employed as the chairman and chief executive officer of Libertyville Bank & Trust.

¶ 4 The judgment of dissolution incorporated a "Marital Settlement Agreement" (MSA), entered on November 30, 2004. The MSA set forth the parties' obligations with respect to various matters, including child support, maintenance, the children's college expenses, and medical insurance.¹ Regarding maintenance, the MSA provided for two "streams" of payments to petitioner. Pursuant to "Maintenance Stream # 1," respondent was required to pay $5000 per month on the fifteenth day of each month, beginning on January 15, 2005, for 60 consecutive months. "Maintenance Stream # 1" was subject to review upon petitioner's filing of a pleading prior to the due date of the sixtieth payment, but it was nonmodifiable by either party during the initial 60–month period. Pursuant to "Maintenance Stream # 2," respondent was required to pay $750 per month on the fifteenth day of each month, beginning on January 15, 2005, through September 15, 2007. "Maintenance Stream # 2" then decreased by $250 every two years until September 15, 2011, at which time all "Maintenance Stream # 2" payments ceased. The MSA further provided that the amount of maintenance was based upon "[respondent's] represented gross income from all sources of approximately $277,500 per year as a base salary, bonuses, restricted stocks, dividends, stock options, warrants, mortgage referral program compensation and company extras, and upon [petitioner's] representation that she is currently a full time homemaker who has not earned any significant income from any source since the children were born."

¶ 5 On December 10, 2009, petitioner filed two petitions, including a "Petition for Increase in Maintenance and Child Support and Other Relief." On March 8, 2010, respondent filed responses to petitioner's petitions, as well as a "Petition to Terminate Maintenance." A hearing on the parties' petitions was held before Judge Jay Ukena on August 31 and September 2, 2010. On March 17, 2011, Judge Ukena issued his oral ruling, which included the following factual findings.

¶ 6 Judge Ukena noted that the parties were married on June 21, 1986, and that the judgment of dissolution of marriage was entered on December 6, 2004. Pursuant to the judgment of dissolution, petitioner received approximately 55% of the marital estate. Neither party had acquired any property since the judgment of dissolution. According to the parties' financial affidavits, petitioner had assets worth about $2,329,427 and respondent had assets worth approximately $1,743,355. Judge Ukena noted that, although the parties were generally in good health, petitioner had back issues, the severity of which was disputed.

¶ 7 Judge Ukena further noted that, beginning in 1996 and until his ruling in March 2011, respondent was the chairman of Libertyville Bank & Trust. Respondent's income had increased from about $272,000 per year at the time of the judgment of dissolution to an average of approximately $392,000 per year by 2010. Petitioner was unemployed at the time of the dissolution. She made efforts to seek employment and had worked part time at Williams–Sonoma, but she left the position in 2008 because she had back issues when lifting heavy items. Thereafter, petitioner remained unemployed through March 2011, except for trying to establish a small side business. Petitioner received around $60,000 per year in investment income (about the same as it was on the date of the dissolution) plus maintenance from respondent. Petitioner indicated that her back problems still limited her employability, and she submitted evidence that she still received treatment for her back. Although neither party introduced evidence as to the exact nature of the back problems, respondent agreed that the condition did affect petitioner's ability "on some level to earn income." Nevertheless, respondent opined that with "appropriate employment" petitioner could earn a minimum of $30,000.

¶ 8 With respect to the standard of living established during the marriage, Judge Ukena found that the parties' lifestyle was not lavish but rather was "commensurate with an income of $272,000 a year," which, during the marriage, was supporting a family of five. Judge Ukena also reviewed the parties' needs and concluded that each party's financial affidavit contained what "each one represents their needs to be." Judge Ukena found that respondent's present and future earning capacity was $392,000 and that petitioner's present and future earning capacity was $60,000. Judge Ukena further found that petitioner had a limited ability to earn more, because she had sacrificed development of her career and education by staying at home for the family during most of the marriage. Judge Ukena found that, by staying at home and taking care of the children, petitioner helped advance respondent's career. Judge Ukena noted that, even if he were to impute an additional $30,000 per year to petitioner's investment income of $60,000, petitioner could not "live the lifestyle of the marriage" on $90,000 per year. After considering the time petitioner would need to acquire the education, training, and employment that would allow her to be financially independent, and balancing it with the standard of living established during the marriage, Judge Ukena determined that "[i]t appears at least that [petitioner] is a candidate for indefinite maintenance."

¶ 9 On March 31, 2011, Judge Ukena entered a written order in accordance with his oral findings. Relevant to these proceedings, Judge Ukena denied respondent's petition to terminate maintenance and granted petitioner's petition for an increase in maintenance. Specifically, the order provided: "[Petitioner] is awarded indefinite maintenance of $5,000 per month commencing on the first month after entry of this Order until further Order of the court." Attached to the order was the transcript of Judge Ukena's oral findings, which were expressly incorporated in the order. Thereafter, respondent filed a motion to reconsider and a motion to reopen the proofs. Judge Ukena denied both motions, and neither party appealed Judge Ukena's rulings.

¶ 10 On February 24, 2016, respondent filed a "Verified Petition to Terminate, or Alternatively, Reduce Maintenance." On April 22, 2016, with leave of court, respondent filed an amended petition. He alleged that on or about December 11, 2015, as a result of corporate restructuring and through no fault of his own, his employment with Libertyville Bank & Trust was terminated. Concurrently with his termination, respondent entered into a "Separation Agreement and General Release" (Separation Agreement) dated December 18, 2015. Pursuant to the Separation Agreement, respondent's total gross compensation was reduced from approximately $38,667 per month to about $24,167 per month. On or about February 29, 2016, respondent accepted employment with The Private Bank. Respondent's gross pay from The Private Bank was approximately $15,500 per month. However, by virtue of having accepted full-time employment with The Private Bank, the compensation respondent had been receiving under the Separation Agreement would terminate on or about August 1, 2016. Respondent asserted that these facts demonstrated a substantial reduction of his income as a result of his termination by Libertyville Bank & Trust and thus constituted a substantial change in circumstances, warranting the termination or modification of maintenance pursuant to sections 504 and 510 of the Illinois Marriage and Dissolution of Marriage Act (Act) ( 750 ILCS 5/504, 510 (West 2016) ). Respondent further asserted that, in light of the fact that he would turn 61 in May 2016 and the unlikelihood that he could procure employment similar in income to his former position with Libertyville Bank & Trust before he reaches 65, at which time he intends to retire, there had been an impairment of his future earning capacity.

¶ 11 On May 11, 2016, petitioner filed a response to respondent's amended petition. On December 12, 2016, respondent filed a motion in limine requesting, inter alia , that the trial court take judicial notice of the factual findings made by Judge Ukena in March 2011. On January 3, 2017, the trial court granted that part of the motion in limine . Specifically, the court stated that it would take judicial notice of "file # 01 D 1029 [and] in particular the transcript of 3/17/2011."

¶ 12 A hearing on respondent's amended petition was held on January 10, 2017. Both respondent and petitioner testified at the hearing, and various exhibits, including tax returns and financial affidavits, were admitted. Respondent testified regarding his employment status. He noted that, due to a decision by management, his position...