Mar 01, 2016

IICLE Family Law Flash Points - March 2016

1. Trial court’s $196,250 valuation of a family business that managed investment accounts with $75 million of assets under management reversed. The Appellate Court reversed a trial court’s finding that husband’s investment management business which had $75 million in assets under management should be valued at $196,250 after each party submitted business valuations. Wife’s valuator opined that husband’s business was worth $495,000 using a market-based approach which took into account a prior transaction where husband purchased approximately $47 million in accounts from another investment advisor for $460,000 a year earlier. Husband’s experts used a capitalization of earnings method and a multi-attribute utility model and opined that the value of the business was $196,250. The Appellate Court noted several problems with the trial court’s finding, including that the multi-attribute utility model’s objective is to conclude what portion of the total fair market value constitutes enterprise and personal goodwill, not the overall value of the business; that the court did not hear testimony from either expert but just reviewed their reports; and that it was against the manifest weight of the evidence that the court would conclude that the fair market value of a business would be less than what husband had paid for a portion of the business a year before trial. In re the Marriage of Johnson, 2016 IL App (5th) 140479.2. $2,750 per month in rehabilitative maintenance for 30 months was an abuse of discretion when award should have been permanent maintenance. A wife and mother who had worked as an assistant at husband’s business for 10-15 hours per week and devoted the rest of her time to caring for the parties’ two children, being an active member of the community and homemaker, and playing the role of “corporate wife” during a 28-year marriage received $2,750 per month in rehabilitative maintenance for 30 months. She had also developed COPD and was under a regular physician’s care at the time of trial. The Court noted at 50 years old with COPD, it was not an ideal time for her to be reentering the workforce. Although the case was being remanded to the trial court for rehearing on a business valuation issue, which would necessitate the court re-evaluating the maintenance award, the Appellate Court opined that based on the facts in evidence, the factors enumerated in Section 504 of the IMDMA heavily favored a substantial permanent maintenance award. In re the Marriage of Johnson, 2016 IL App (5th) 140479.3. Child custody evaluator appointed under [former] Section 604(b) of the IMDMA entitled to judicial immunity against malpractice lawsuits. In 2012, Family Stress Clinic was retained to perform psychological testing on a father to a custody suit. The psychologist diagnosed the father with obsessive-compulsive personality disorder and father filed a malpractice suit alleging that the diagnosis deviated from the standard of care in clinical psychology and as a result, he lost custody of his children. The Appellate Court upheld the 7th Circuit’s prior ruling under Cooney v. Rossiter, 583 F.3d 967 (7th Cir.2009) that “[C]ourt-appointed experts…are absolutely immune from liability for damages when they act at the court’s direction.” The Court, while stating that it need not decide whether psychological testing was within the scope of section 604(b), opined that it thought it was clear that the statute allowed courts to seek the advice of mental health professionals. Heisterkamp v. Pacheco, 2016 IL App (2d) 150229.4. Georgia law, not Illinois, controlled the issue of contribution of college expenses, and therefore father was not obligated to contribute to emancipated daughter’s college tuition. Mother and father divorced in Georgia in 2003 and the mother later moved to Illinois with the parties’ children. In 2014, the mother filed a petition to enroll the Georgia judgment as well as a petition for contribution to college expenses. The Illinois trial court granted the petition for contribution, but the Appellate Court reversed holding that under the Uniform Interstate Family Support Act (UIFSA), Georgia law controlled the issue. The law of the state that issued the initial child support order governs whether a parent will be required to contribute to a child’s college expenses. In Georgia, a parent has no duty to pay for a child’s expenses once a child has reached the age of 18, and because Illinois must apply Georgia law, the trial court did not have the authority to order father to contribute to the child’s college expenses. In re the Marriage of Jones, 2016 IL App (3d) 150237.5. Trial court reversed for issuing a civil restraining order instead of an order of protection. After an evidentiary hearing in which the petitioner sought a plenary order of protection, the trial court made a finding of abuse but entered a civil restraining order instead of an order of protection. The Appellate Court reversed because under the Domestic Violence Act, once the trial court finds the respondent has committed abuse, it “shall” issue an order of protection. The Court noted the significant differences between a civil restraining order and an order of protection which include but are not limited to criminal penalties including immediate arrest for violation of an order of protection; automatic entry into the LEADS system of law enforcement officers; the order of protection process is much friendlier for pro se litigants; and law enforcement officers have expanded authority to prevent further abuse. Sanchez v. Torres, 2016 IL App (1st) 151189.6. Denial of pet visitation upheld. In a case of first impression, the First District upheld a trial court’s ruling denying husband’s request for pet visitation with the parties’ two dogs. The Court relied upon the New York case of Travis v. Murray, 42 Misc.3d 447 (N.Y.Sup.Ct.2013) which declined to apply a best interest standard to pets and ultimately held that doing so would be an invitation to endless post-divorce litigation. The trial court also relied upon the Illinois Animal Control Act, which is the only statute that defines who a dog owner is in Illinois, and under that definition, the wife was considered the dog’s owner because the dogs were left in her care when husband moved out of the residence. The trial court was also upheld on other several issues concerning the parties’ premarital agreement, including wife’s right to reimbursement for marital monies contributed to non-marital defined benefit plans; the award of a note payable to wife stemming from the collateralization of her non-marital property; and the allowance of wife to continue to be the custodian of a 529 plan for her stepson. In re the Marriage of Ender and Baker, 2015 IL App (1st) 142435.

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