In re Marriage of Baumgartner

• Decision Date: 30 June 2008
• Docket Number: No. 1-06-2866.,1-06-2866.
• Citation: 890 N.E.2d 1256
• Parties: In re MARRIAGE OF Susan Lynn BAUMGARTNER, Petitioner-Appellant, and Craig Baumgartner, Respondent-Appellee.
• Court: United States Appellate Court of Illinois

890 N.E.2d 1256

In re MARRIAGE OF Susan Lynn BAUMGARTNER, Petitioner-Appellant, and Craig Baumgartner, Respondent-Appellee.

No. 1-06-2866.

Appellate Court of Illinois, First District, Second Division.

June 30, 2008.

Richard B. Kirk, Chicago, for Appellant.

Julie L. Campbell, Evanston, for Appellee.

Justice HALL delivered the opinion of the court:

The petitioner, Susan Lynn Baumgartner, now known as Susan Lynn Ginensky (Susan), filed a petition seeking to hold her former husband, respondent Craig Baumgartner (Craig), in indirect civil contempt for failure to comply with an order for child support. The circuit court of Cook County ordered Craig to pay additional amounts of child support but refused to enter a contempt finding and sanctioned Susan for a discovery violation.

Susan appeals, raising the following issues: (1) whether the parties' settlement of Craig's 2001 child support obligation was enforceable; (2) whether the proceeds from mortgage loans and the proceeds from the sale of residential property are income for determining child support; (3) whether Craig's nonreimbursed business expenses are deductible in determining his net income for child support purposes; (4) whether the circuit court erred in requiring Susan to prove that Craig's unexplained bank deposits were income for child support purposes; (5) whether the circuit court erred when it refused to hold Craig in indirect civil contempt of court; and (6) whether Susan's conduct in subpoenaing Craig's attorneys for deposition was sanctionable.

Procedural History

The parties' marriage was dissolved in 1998. Pursuant to the judgment for dissolution of marriage, the parties had joint custody of their only child, Maxwell Taylor Baumgartner (Max). However, Max was to reside with Craig.

On April 19, 2001, an agreed order was entered modifying the judgment for dissolution of marriage (the agreed order). The agreed order provided that Max was to reside with Susan and set forth Craig's child support obligation as follows:

"Effective January 1, 2001 Craig shall pay $762 per month to Susan as child support which is 20% of his estimated net income. At this time, it is not known whether Craig's monthly net income will exceed $3,809 due to overtime, bonuses, or raises. Accordingly, on an annual basis, within 30 days after Craig receives his W-2 statement from his employer at year end, he will: (i) provide a copy of his W-2 to Susan along with a copy of his Year-end pay stub, and (ii) recompute his net income in light of any additional income and/or deductions in excess of the amount upon which this order is based; and (iii) if the amount of child support paid during the prior year was less than 20% of Craig's actual net income from,¹ he will pay Susan the difference between the amount paid and the recomputed 20% figure so that the total amount will equal 20% of Craig's net income, as defined by 750 ILCS 5/505. In addition, Craig will provide Susan with copies of his income tax returns on an annual basis within 14 days after filing the returns."

On June 3, 2005, Susan filed a petition seeking to have Craig held in indirect civil contempt for failure to comply with the agreed order. Susan alleged that Craig had paid only the minimum child support amount for the years 2001 through 2004, and had refused to pay the excess amounts due under the re-computation formula in the agreed order. Susan further alleged that Craig had failed to provide her with proof of his income as required by the agreed order. Susan sought attorney fees and costs.

On June 29, 2005, pursuant to section 2-619 of the Code of Civil Procedure (the Code) (735 ILCS 5/2-619 (West 2004)) Craig filed a motion to strike and dismiss the allegations relating to the claimed arrearage for 2001. Relying on the doctrine of equitable estoppel, Craig alleged that Susan and he had entered into a settlement agreement resolving the amount of child support due for 2001. Attached to the motion was a copy of a letter from Susan's attorney to Craig's attorney containing the terms of the settlement agreement, a facsimile confirmation from Craig's attorney accepting the settlement offer and a copy of the Craig's cancelled check demonstrating payment of the settlement amount.

In her response to the motion, Susan argued that extrajudicial modifications of support obligations were not enforceable. She further argued that Craig could not rely on equitable estoppel because he had not relied to his detriment on the agreement and that there was no consideration for the settlement agreement. On August 17, 2005, the circuit court granted Craig's motion to dismiss the claim for child support for 2001 and set the case for trial on the remaining allegations of the petition.

On October 6, 2005, Craig filed a motion for partial summary judgment on Susan's claims that 20% of the proceeds of a residential mortgage loan Craig obtained and 20% of the proceeds from the sale of Craig's homestead property should have been paid to her as child support for Max.² Susan responded that summary judgment was not appropriate as there existed questions of fact as to what happened to the proceeds from the sale of his residence. She further argued that there was no authority under section 505 of the Illinois Marriage and Dissolution of Marriage Act (the Act) (750 ILCS 5/505 (West 2004)) to exclude proceeds from residential property transactions or loan proceeds from income for purposes of determining child support. Following a hearing, the circuit court granted the motion for partial summary judgment.

On December 21, 2005, Susan's attorney issued a subpoena for deposition to Craig's wife, Jeanine Baumgartner. Susan's attorney also issued subpoenas for deposition and document production to Craig's attorneys, Julie Campbell and Robert Ramirez, Jr.

On December 29, 2005, Craig filed a motion to quash the deposition subpoenas and for sanctions. In his motion, Craig alleged that the subpoenas issued to his attorneys sought discovery of material protected by the attorney-client privilege and were issued to harass, annoy and disqualify the attorneys from representing him. Craig sought sanctions pursuant to Supreme Court Rule 137 (155 Ill.2d R. 137) and Supreme Court Rule 219(d) (210 Ill.2d R 219(d)).

On January 18, 2006, Susan filed her response to the motion to quash. Susan maintained that the subpoena for deposition to Ms. Campbell was based on Ms. Campbell's association with Craig's consulting business and not their attorney-client relationship. Susan further maintained that Craig had waived the attorney-client privilege with respect to Mr. Ramirez when he asserted the affirmative defense that he relied on Mr. Ramirez's advice in this case. On January 24, 2006, the circuit court entered an order denying the motion to quash as to Jeanine Baumgartner but granting the motion as to Ms. Campbell and Mr. Ramirez.

On January 26, 2006, a hearing was held on Susan's petition to hold Craig in contempt. Susan's attorney questioned Craig about deposits made to joint accounts. After Craig answered numerous times that he did not recall the source of the deposit, his attorney objected on relevancy grounds. The circuit court sustained the relevancy objection on the grounds that there was no proof that the deposits were Craig's or that the deposits were from income over and above what he had already disclosed as income. Under questioning by his own attorney, Craig explained that in 2002, some of the deposits could have come from his NeoPharm paychecks. He further explained that the deposits could have been made by his present wife, Jeanine, from her income or accounts.

On direct examination by his attorney, Craig testified as to business expenses he had used to arrive at his net income to determine his child support obligation. Susan's attorney stipulated to the evidence of the deductions but not to the propriety of the deductions. The case was continued for decision.

Prior to the court's ruling on the petition, Craig offered the sum of $2,554.48 to Susan to settle the 2005 child support amount, in exchange for a complete release of his 2005 child support obligation. On March 6, 2006, Susan filed a petition for indirect contempt of court against Craig for his failure to pay the child support he owed for 2005.

On March 14, 2006, the circuit court entered its order as to the petition for indirect civil contempt for the years 2002, 2003 and 2004. The court ruled as follows: (1) Craig's failure to pay the balance of child support due for those years was not contemptuous; (2) Craig was permitted to deduct his business expenses, medicare tax, social security payments, actual federal, state and local taxes paid and his health insurance premiums from his gross income to determine his net income for child support purposes; (3) Craig owed $1,664.95 for 2002, $5,035.42 for 2003 and $4,500 for 2004 child support; (4) no interest was due for those amounts pursuant to section 505 of the Act (750 ILCS 5/505 (West 2006)); and (5) Susan's request for attorney fees was denied but leave was granted to the parties to file for contribution. Craig was ordered to pay the above sums to Susan; his petition for sanctions remained pending.

The court also ruled on Susan's petition on Craig's 2005 child support obligation. The court found that Craig's failure to pay the balance due for 2005 was not contemptuous, and he was permitted to take the aforementioned deductions from his gross income to arrive at his net income for child support. The court calculated the balance of his support obligation for 2005 to be $3,526.06. The court denied Susan attorney fees but again granted leave to file for contribution.

On June 8, 2006, the circuit court heard argument on Craig's motion for sanctions. The court denied Rule 137 and Rule 219(d) sanctions but awarded sanctions for the issuance of the subpoenas to Craig's attorneys, stating as follows:

"But I really feel that issuing...