Marriage of Chapman, In re

• Decision Date: 19 June 1998
• Docket Number: No. 1-97-0062,1-97-0062
• Parties: , 231 Ill.Dec. 811 In re MARRIAGE OF Todd J. CHAPMAN, Petitioner-Appellee, and Florence Adele Chapman, n/k/a Florence Mesirow, Respondent-Appellant.
• Court: United States Appellate Court of Illinois

Page 365

697 N.E.2d 365

297 Ill.App.3d 611, 231 Ill.Dec. 811

In re MARRIAGE OF Todd J. CHAPMAN, Petitioner-Appellee and Florence Adele Chapman, n/k/a Florence Mesirow, Respondent-Appellant.

No. 1-97-0062.

Appellate Court of Illinois,

First District, Sixth Division.

June 19, 1998.

Holleb & Coff, Chicago (Michael A. Reiter and Jay Edelson, of counsel) and Alan D. Hoffenberg, Chicago ( Alan D. Hoffenberg, of counsel), for Petitioner-Appellee.

Greenburg & Hermann, Chicago (Janet L. Hermann, of counsel), for Respondent-Appellant.

Justice QUINN delivered the opinion of the court:

Appellant, now known as Florence Mesirow (Mesirow), appeals from a circuit court order dismissing her petition for rule to show cause and other relief. The petition requested that the circuit court order appellee, Todd Chapman (Chapman), to direct his trustees to pay child support from certain trusts. Chapman is the sole beneficiary of these trusts and has a limited power of appointment under the spendthrift provisions.

For the following reasons, we reverse in part, affirm in part, and remand with directions.

The underlying facts of this case are as follows. Mesirow obtained a judgment for dissolution of marriage on October 12, 1993. The judgment incorporated a marital settlement agreement entered into on that same date.

Under the terms of the settlement agreement, Chapman was to pay $3,200 per month in unallocated maintenance and child support. Chapman's obligation to pay maintenance terminated in the event of Mesirow's remarriage, but Chapman would still be obligated to pay child support in the amount of $2,000 per month. Mesirow remarried in December 1995.

Chapman filed a petition for modification of unallocated maintenance and child support on September 13, 1995, claiming that he suffered a significant reduction in income. Without a court order, Chapman unilaterally reduced his support payments from October 1995 through March 1996, resulting in an arrearage of $9,210.

On April 10, 1996, Mesirow filed a petition for rule to show cause why Chapman should not be held in contempt for the arrearage in child support. In her petition, Mesirow first argued that the condition that maintenance cease upon Mesirow's remarriage should not be enforced because Chapman's reduction in support payments forced Mesirow to advance her wedding date. Second, Mesirow sought judgment and damages for Chapman's arrearage in support payments. Finally, Mesirow requested that the court order Chapman to exercise his limited power of appointment to direct the trustees of Chapman's spendthrift trusts to pay $2,000 per month in future child support.

Chapman moved to dismiss the petition, and the court entered an order granting the motion to dismiss. Mesirow appeals from this order. We address Mesirow's arguments as to the payment of child support arrearages and as to the direction of payment of future child support from the spendthrift trusts.

On appeal, appellant's brief only argues as to the direction of payment from Chapman's trusts.

However, pursuant to our authority under Supreme Court Rule 366 to affirm, reverse, or modify the judgment of the circuit court on any grounds present in the record, we reverse the dismissal of appellant's petition for the payment of past arrearages in child support. 134 Ill.2d R. 366.

Upon review of the record, there is ample support for awarding judgment and damages to appellant for appellee's arrearage in child support payments. Under the statutory scheme of the Illinois Code of Civil Procedure (735 ILCS 5/2-1403 (West 1994)), the Non-Support of Spouse and Children Act (Non-Support Act) (750 ILCS 15/4.1. (West 1994)), the Illinois Marriage and Dissolution of Marriage Act (Marriage and Dissolution Act) (750 ILCS 5/706.1. (West 1994)), and the public policy expressed in the case law, a court may order the withholding of payments from a trust to satisfy a child support judgment.

In the seminal case of In re Matt, 105 Ill.2d 330, 85 Ill.Dec. 505, 473 N.E.2d 1310 (1985), the Illinois Supreme Court held that income from a spendthrift trust is subject to garnishment to collect past-due child support under the Non-Support Act. The supreme court held that it "is the public policy of Illinois to ensure that support judgments are enforced by all available means." (Emphasis added.) Matt, 105 Ill.2d at 334, 85 Ill.Dec. 505, 473 N.E.2d 1310.

Under the Illinois Code of Civil Procedure (Code), income from a spendthrift trust is generally exempt from invasion to satisfy judgments. 735 ILCS 5/2-1403 (West 1994). However, after Matt, section 2-1403 of the Code was amended (Pub. Act. 85-907, art. II, § 1, eff. November 23, 1987) to provide for the collection of child support:

"The income or principal of a trust shall be subject to withholding for the purpose of securing collection of unpaid child support obligations owed by the beneficiary as provided in Section 4.1 of the 'Non-Support of Spouse and Children Act' and similar Sections of other Acts which provide for support of a child as follows:

(1) income may be withheld if the beneficiary is entitled to a specified dollar amount or percentage of the income of the trust, or is the sole income beneficiary * * *." 735 ILCS 5/2-1403 (West 1994).

The trial court below dismissed appellant's petition based on an inaccurate interpretation of the current law on spendthrift trusts in child support cases. The trial court seemed to focus on the provisions of the trust and the limiting language in Matt, which held that only the income from a trust could be garnished and not the principal, and only when the obligor was delinquent. Matt, 105 Ill.2d at 334, 85 Ill.Dec. 505, 473 N.E.2d 1310. Section 2-1403, however, expanded Matt and specifically states that both the income and the principal of a trust can be reached to satisfy a child support judgment. 735 ILCS 5/2-1403 (West 1994). The portion of the holding in Matt that has not been overruled, or legislatively amended under section 2-1403, is the portion requiring that the child support payments be delinquent.

Appellee is the beneficiary of five separate trusts, which are included in the record and labeled as Trusts B through F. The language of the trust labeled Trust B, article IV, section 2, as well as in Trust C, gives appellee the right of appointment to direct his trustee to pay money from the trust to assist his descendants, here, the children who are the subject of the child support order. Both trusts state the following:

"Limited Powers of Appointment. The Trustee shall, upon receipt of written direction as herein provided, distribute from the trust estate of a separate trust such amount or amounts as the beneficiary of such trust may appoint to or for the benefit of all or any one or more of the descendants of said beneficiary as said beneficiary may designate by an instrument in writing delivered to the Trustee during the lifetime of said beneficiary, and upon the death of said beneficiary, such amount or amounts as said beneficiary may appoint to or for the benefit of all or any one or more of the descendants of said beneficiary as said beneficiary may designate by the valid Will of said beneficiary admitted to probate in any jurisdiction." (Emphasis added.)

Thus, the settlor of the trust clearly contemplated that income or principal of the trust could be used for the benefit of appellee's children.

This language is different from the language of the trust in Matt, 105 Ill.2d 330, 85 Ill.Dec. 505, 473 N.E.2d 1310. The spendthrift provision in the trust in Matt stated the following:

"Neither principal nor income of the Trust herein established shall be pledged, transferred, sold, anticipated or encumbered by any beneficiary herein named, nor be in any manner liable, while in the possession of the Trustee, for any contract, debt or obligation, nor for any claim voluntarily or involuntarily created either legal or equitable against any beneficiary, including claims for alimony or support of any spouse of such beneficiary." Matt, 105 Ill.2d at 332, 85 Ill.Dec. 505, 473 N.E.2d 1310.

The court erroneously relied on Matt in the instant case, where the language of the trust itself does not preclude reaching the income and principal to assist appellee's children. Thus, the court below was in error when it ruled that the trust income or principal could not be reached at all to satisfy a child support judgment.

The next question is whether appellant petitioned for the appropriate remedy in enforcing the judgment. Appellant requested that the court order appellee to direct his trustees to pay the child support from the trusts, instead of requesting a garnishment directly on the trusts.

It appears that section 2-1403 would not preclude a court from ordering a trust beneficiary to direct his trustee to make child support payments. The Code does not specify that garnishment is the only remedy to collect unpaid child support. Section 2-1403 merely states that "[t]he income or principal of a trust shall be subject to withholding." 735 ILCS 5/2-1403 (West 1994).

Also, in the recent case of In re Marriage of Stevens, 292 Ill.App.3d 994, 227 Ill.Dec. 242, 687 N.E.2d 165 (1997), this court evidenced a willingness to uphold enforcement by various means. In Stevens, this court upheld an order directing the garnishment against not only the trust, but also the trust's bank account, in order to satisfy the child support judgment in that case. Stevens, 292 Ill.App.3d at 1001, 227 Ill.Dec. 242, 687 N.E.2d 165. The trust argued that the only proper remedy was garnishment of the trust, and not of the trust account, because only the debtor or the account of a judgment debtor can be garnished under traditional garnishment law. This court held that garnishment of both the trust and the trust account was proper because an order for payment of child support is not a traditional garnishment but, rather, is one specifically allowed by statute....