No. 3-04-0517
_________________________________________________________________
filed June 9, 2006.
IN THE
APPELLATE COURT OF ILLINOIS
THIRD DISTRICT
A.D., 2006
_________________________________________________________________
In re MARRIAGE OF ) Appeal from the Circuit Court
ROD SAMARDZIJA, ) of the 12th Judicial Circuit,
) Will County, Illinois,
Petitioner-Appellee, )
) No. 02-D-371
and )
)
LILLY SAMARDZIJA, ) Honorable
) Robert J. Baron,
Respondent-Appellant. )Judge, Presiding.
_________________________________________________________________
JUSTICE SLATER delivered the opinion of the court:
_________________________________________________________________
The marriage of petitioner Rod Samardzija and respondent Lilly Samardzija was
dissolved on February 27, 2004. Respondent raises various issues on appeal
concerning the distribution of the parties' property, the timing and permanency of
maintenance, payment of attorney fees and credit card debt, and the propriety of a
geographic limitation imposed by the trial court. We affirm in part and reverse in part
and remand.
Facts
To avoid repetition, we will initially present only a brief overview of the facts.
Additional testimony and other evidence will be set forth as necessary in the context of
resolving particular issues.
The parties were married on September 8, 1996, and during most of the
marriage they resided in Orland Park, Illinois. Two children were born during the
marriage: Tanja, born June 18, 1997, and Maya, born January 7, 2000. Respondent
has a certificate as a lab technician from a community college in Yugoslavia. She
worked for 10 months in an oncology laboratory in Belgrade, analyzing blood samples.
After immigrating to the United States in 1992, she worked for two physicians in Ohio.
Respondent then worked for a modeling management agency for 10 months. After
getting married respondent worked in the jewelry department at Marshall Field's during
the Christmas season. She did no other work during the marriage because her
husband wanted her to stay at home and raise their children. Respondent was 35 years
old at the time the dissolution judgment was entered.
Petitioner is president of Gremp Steel Company, a corporation owned primarily
by petitioner and other family members. Petitioner owns 25% of the company's shares,
which were received from his parents. The company regularly paid "profit bonuses" to
shareholders. The company loaned petitioner $112,000, which was used in building a
home for the couple in Orland Park. Petitioner repaid the loan by returning the bonuses
he was given. According to Norman Diamond, the accountant for Gremp Steel, the
bonuses were paid to petitioner because he was a stockholder, not because of his
employment. Petitioner's salary was set annually by the board of directors, which
consists of petitioner, his mother, his brother, his uncle, and Norman Diamond. The trial
court found that petitioner's average annual salary was $160,000. Petitioner was 44
years old at the time the marriage was dissolved.
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The primary marital asset was the Orland Park residence, which the parties
began building after they were married and which was completed in September of 1998.
The home, which was titled in petitioner's name only, was built on a lot purchased by
petitioner prior to the marriage. The lot was valued at $61,000 and the home was
valued at $360,000 by petitioner's appraiser, as of the date of completion. The
appraised value as of June, 2003, was $445,000. Petitioner testified that he received
$125,000 from the sale of his house in South Holland in December of 1997. He put
$50,000 in a certificate of deposit and $75,000 in a joint account, which was then used
to build the Orland Park home. That money, plus the $112,000 petitioner borrowed
from Gremp, constituted the majority of the funds used to build the home, which cost
nearly $300,000. The indebtedness was repaid by returning petitioner's profit bonuses
to Gremp, plus payments of $500 made from petitioner's paycheck.
The trial court divided the marital estate as follows:
Petitioner:
1/2 of the First Midwest checking account $3,300
Cash surrender value of the
ING life insurance policy $14,000
1/2 half of the marital portion of the
Gremp Steel retirement account $29,600
$46,900
Respondent:
Bank One checking account $500
1/2 of First Midwest checking account $3,300
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1/2 of Gremp Steel retirement account $29,600
Honda Minivan $18,000
$51,400
The court also found that the Orland Park home was petitioner's non-marital
property, but ruled that $140,000 of marital funds should be reimbursed to the marital
estate. Those funds were distributed to respondent in the amount of $100,000, while
petitioner received $40,000. Each party was made responsible for their own attorney
fees and debts, including $38,000 in credit card debt accumulated by respondent since
the parties had separated. Petitioner received non-marital property, not including the
Orland Park house, valued at $417,000.
In addition to the above, the trial court ordered petitioner to pay 28% of his
income as child support, a monthly payment of $2,517. Petitioner was also ordered to
pay respondent $2,000 per month in rehabilitative maintenance for a period of 36
months.
Analysis
Respondent first contends that the trial court erred in classifying the Orland Park
home as non-marital. Respondent argues that the use of some non-marital funds to
build the home did not overcome the presumption that it was marital property. We
agree.
Section 503(a) of the Illinois Marriage and Dissolution of Marriage Act (Marriage
Act) (750 ILCS 5/503(a) (West 2004)) provides that all property acquired by either
spouse during marriage is marital property unless it was acquired in certain specified
ways, such as by gift or devise. Section 503(b)(1) creates a presumption that property
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acquired during marriage is marital, regardless of how title is held. In addition, section
503(c)(1) states that "if marital and non-marital property are commingled into newly
acquired property resulting in a loss of identity of the contributing estate, the
commingled property shall be deemed transmuted to marital property." 750 ILCS
5/503(c)(1) (West 2004). The trial court's classification of property as marital or non-
marital will not be disturbed unless it is against the manifest weight of the evidence. In
re Marriage of Johns, 311 Ill. App. 3d 699, 724 N.E.2d 1045 (2000).
In this case the trial court found that the home "was not transmuted" and
"remain[ed]" non-marital property, although the court also ordered $140,000 to be
contributed back to the marital estate. It appears that the court believed that because
the house was titled in petitioner's name, and because he contributed a substantial
amount of non-marital funds towards the cost of building the house, it was
presumptively non-marital. However, the presumption that property acquired during the
marriage is marital applies "regardless of whether title is held individually or by the
spouses in some form of co-ownership." 750 ILCS 5/503(b)(1) (West 2004); see In re
Marriage of Ohrt, 154 Ill. App. 3d 738, 507 N.E.2d 160 (1987) (finding home was marital
despite fact that husband's name alone was on title). Moreover, "[a] marital residence
owned by both spouses, even if one spouse has furnished all the consideration for it out
of non-marital funds, will be presumed to be marital property absent clear and
convincing rebutting evidence." Marriage of Johns, 311 Ill. App. 3d at 703, 724 N.E.2d
at 1048.
Accordingly, we find that the Orland Park home, built by the parties during the
marriage, was presumptively marital property. Although petitioner contributed non-
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marital funds towards the home's construction, as well as the lot on which it was built,
marital funds from petitioner's paychecks were used to partially satisfy the loan from
Gremp Steel. Under the circumstances, the presumption of marital property has not
been overcome. We therefore reverse the trial court's finding that the home was non-
marital. We remand for recalculation of the home's value and for determination by the
court regarding any credit due for contributions of non-marital funds. We note that on
remand the trial court is not bound by its original proportions in distributing the equity in
the marital home. We also reject respondent's argument that, because she has custody
of the parties' children, the trial court abused it's discretion in not awarding her the
marital home. Although it is desirable to keep children in the family home for the
stability it affords, that factor may be outweighed by the need to give the parties
sufficient income with which to rebuild their lives. In re Marriage of Clabault, 249 Ill.
App. 3d 641, 619 N.E.2d 163 (1993). The Orland Park home was, by far, the primary
asset of the marital estate. Awarding it to respondent would potentially have required
respondent to reimburse a substantial amount to petitioner's non-marital estate, a
seemingly unrealistic proposition. We find no abuse of discretion.
Respondent next contends that the profit bonuses which petitioner loaned back
to Gremp Steel were a marital asset which should have been included in the division of
marital property. We disagree. Norman Diamond, the accountant for Gremp Steel,
testified that the shareholders, including petitioner, would sometimes receive "profit
bonuses" which they would then loan back to the company. According to Diamond, the
bonuses were only given to stockholders and were not based on employment. Since it
is undisputed that the Gremp Steel stock was a gift from petitioner's parents, it was non-
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marital property, as was the income, or "bonuses" flowing from that property. See ILCS
5/503(a)(1),(8) (West 2004) (income from property acquired by gift is non-marital
property). In addition, Diamond testified that he did not believe that petitioner had ever
put any money into the company other than loaning back the profit bonuses and
dividends. Respondent mistakenly relies on In re Marriage of Schneider, 214 Ill. 2d
152, 824 N.E.2d 177 (2005), in which the court held that accounts receivable should be
included in determining the value of a dental practice. The issue in Schneider was the
proper valuation of a marital asset, not the effect of loans by a spouse of non-marital
funds to a non-marital asset. We find no error.
Respondent next asserts that the trial court abused its discretion in failing to
make the award of maintenance retroactive to the date of filing of the petition for
dissolution. She also maintains that the trial court should have awarded permanent
maintenance.
The trial court has broad discretion in determining the propriety, amount and
duration of a maintenance award, and its judgment will not be disturbed absent an
abuse of discretion. In re Marriage of Rogers, 352 Ill. App. 3d 896, 817 N.E.2d 562
(2004). In addition, whether to make a modification of maintenance retroactive is also a
decision within the trial court's discretion. Brandt v. Brandt, 99 Ill. App. 3d 1089, 425
N.E.2d 1251 (1981). In this case the record shows that an order of temporary
maintenance in the amount of $150 per week was entered in August of 2001. That
obligation was modified in April of 2002 to $300 per week in unallocated family support.
In the dissolution judgment, respondent was awarded rehabilitative maintenance of
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$2,000 per month for 36 months. This was in addition to child support paid by petitioner
in the amount $2,517 per month.
With regard to the issue of retroactivity, the essence of respondent's argument is
that the initial amounts were too low, which resulted in an overuse of credit cards and
cash advances, totaling $38,000. She asserts that she does not have the financial
ability to pay off the credit card debt, thereby justifying an award of retroactive
maintenance. However, the trial court specifically addressed the issue of respondent's
credit card debt, finding that "the credit card bills that were run up *** were outside the
scope of what she should have done in this case without court permission. It was sort
of a frolic on her own. I just think she is going to assume those own [sic] bills herself."
The record supports the court's ruling, given respondent's testimony that among the
items charged were a $1,300 suit of clothes, a $1,900 fur coat, $879 in sportswear, a
$939 crystal ball, and over $600 for two wedding gifts. We find no abuse of discretion.
With regard to the permanency issue, section 504 of the Marriage Act sets forth
various factors to be considered in awarding maintenance, including the income and
property of each party, their present and future earning capacity, the time necessary to
acquire appropriate education, training and employment, a party's ability to support
herself, the duration of the marriage and the standard of living established during it, the
age and physical and emotional conditions of the parties, and any other factor that the
court finds to be just and equitable. 750 ILCS 5/504(a) (West 2004). A court is not
required to give equal weight to each factor, so long as the balance struck by the court
is reasonable. In re Marriage of Miller, 231 Ill. App. 3d 480, 595 N.E.2d 1349 (1992).
Respondent argues that permanent maintenance should have been awarded because
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she has never earned more than eight dollars per hour and she has some difficulty
speaking English.
Maintenance is intended to be rehabilitative in nature to allow a dependent
spouse to become financially independent. Permanent maintenance is appropriate,
however, where a spouse is unemployable or employable only at an income
substantially lower than the previous standard of living. Nevertheless, the recipient
spouse has a good faith obligation to become self-sufficient, while using the
maintenance award to help during the transition period. In re Marriage of Haas, 215 Ill.
App. 3d 959, 574 N.E.2d 1376 (1991). Under the abuse of discretion standard, the
question is not whether this court might have decided the issue differently, but whether
any reasonable person could have taken the position adopted by the trial court. See
Marriage of Miller, 231 Ill. App. 3d 480, 595 N.E.2d 1349.
The trial court found that respondent was "college educated and is a bright,
resourceful and employable person." The court commented on respondent's work
experience in the medical laboratory field and stated that she was capable of earning
income. The court also noted that the duration of the marriage was not long. These
observations are supported by the record and provide insight into the court's rationale,
which cannot be characterized as unreasonable. We find no abuse of discretion.
Respondent next contends that the trial court abused its discretion in denying her
motion to allow her, three weeks prior to trial, to seek new counsel. The trial court noted
in the dissolution judgment that respondent "employed five attorneys during the course
of these proceedings, resulting in delays in resolving the issues and increased cost to
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both parties due to the time required by each new attorney to familiarize himself or
herself with the case." We find no abuse of discretion.
In a related issue, respondent also argues that the trial court should have
ordered petitioner to pay her attorney fees. Generally, attorney fees are the
responsibility of the party who incurred them, although section 508 of the Marriage Act
does allow the court to order a party to pay another party's fees. In re Marriage of Keip,
332 Ill. App. 3d 876, 773 N.E.2d 1227 (2002); see 750 ILCS 5/508(a) (West 2004). The
trial court's decision with regard to the payment of fees will not disturbed absent an
abuse of discretion. Marriage of Keip, 332 Ill. App. 3d 876, 773 N.E.2d 1227.
In finding that respondent should be responsible for her own attorney fees, the
trial court ruled that she had engaged in actions "designed to delay and harass"
petitioner, including the failure to comply with discovery orders and orders for
depositions, thereby prolonging the case and causing petitioner additional expense.
The court also noted that petitioner had contributed $3,500 towards the fees of one of
respondent's attorneys, and that the parties 2001 income tax return of $22,000 was
equally divided for the purpose of paying attorney fees. Under the circumstances, we
find no abuse of discretion.
Respondent also asserts that petitioner should have been ordered to pay the
$38,000 in credit card debt accumulated during the parties' separation. As we noted in
our discussion of retroactive maintenance, the trial court was skeptical of the necessity
of much of that debt, characterizing it as a "frolic." We find no abuse of discretion.
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Finally, respondent maintains that the trial court erred in ordering her not to move
the childrens' residence more than 25 miles from Orland Park without petitioner's
consent or by court order. We agree.
In general, a parent with primary physical custody of the children need not obtain
judicial approval before moving to another location within Illinois (In re Marriage of
Seitzinger, 333 Ill. App. 3d 103, 775 N.E.2d 282 (2002); In re Marriage of Wycoff, 266
Ill. App. 3d 408, 639 N.E.2d 897 (1994)), although the parties can impose geographic
limitations by agreement Marriage of Seitzinger, 333 Ill. App. 3d 103, 775 N.E.2d 282; In
re Marriage of Means, 329 Ill. App. 3d 392, 771 N.E.2d 501 (2002)). In addition,
consistent with the trial court's broad powers in custody matters, it may condition
custody upon the custodian living within a reasonable distance from the non-custodial
parent to facilitate visitation. Marriage of Seitzinger, 333 Ill. App. 3d 103, 775 N.E.2d
282; In re Marriage of Manuele, 107 Ill. App. 3d 1090, 438 N.E.2d 691 (1982).
The only two reported cases in Illinois which directly address the propriety of
court-imposed geographical restrictions both reversed the trial court. The Manuele
court rejected a limitation to Sangamon county as unreasonably restrictive, while
Seitzinger ruled that a restriction to Sangamon or Cass county was arbitrary because
geographic location did not necessarily determine ease of visitation. Neither case
provides much guidance in evaluating the reasonableness of a geographical restriction.
Nevertheless, we believe that such limitations should only be imposed where the
evidence presented establishes a specific need to do so. This is consonant with the
principle that "[c]ustodial parents should not be expected to give up careers for the sake
of remaining in the same geographical location." Marriage of Wycoff, 266 Ill. App. 3d at
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416, 639 N.E.2d at 904, quoting In re Marriage of Good, 208 Ill. App. 3d 775, 778, 566
N.E.2d 1001, 1003 (1991). This is also in keeping with the general rule of allowing a
custodial parent to move freely within the state. See Marriage of Means, 329 Ill. App.
3d at 397, 771 N.E.2d at 505 (describing "general rule" that custodial parent may move
anywhere in Illinois without judicial approval).
The only justification offered by petitioner in support of the restriction imposed by
the court is a provision in the joint parenting order granting petitioner a "right of first
refusal" to take care of the children on those occasions where respondent would be
away for more than two hours and would have engaged a babysitter. Petitioner argues
that without the 25-mile restriction he would be unable to reach the children promptly,
and his right to care for the children would be meaningless.
Assuming for the sake of argument that moving beyond the 25-limit would
interfere with petitioner's ability to care for the children in respondent's absence, we do
not believe that it justifies a preemptive geographic restraint. The case law suggests a
presumption in favor of allowing freedom of movement within the state, and overcoming
that presumption requires a more compelling reason than simply avoiding
inconvenience to the non-custodial parent. As nothing else in the record appears to
support the 25-mile restriction, we find that imposing it was an abuse of discretion, and
it is reversed. We point out, however, that our ruling has no preclusive effect with
regard to future determinations by the trial court concerning any relocation by
respondent. See, e.g., In re Marriage of Main, 361 Ill. App. 3d 983, 838 N.E.2d 988
(2005) (in considering change of custody, trial court may consider whether custodial
parent's decision to move to distant location within Illinois was motivated by desire to
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frustrate non-custodial parent's visitation rights). We also note that our reversal on this
issue and on the classification of the parties' home should not be construed as a
criticism of the trial court. On the contrary, the court's professionalism and
thoroughness was evident from its extensive notes and detailed judgment.
In summary, we reverse the trial court's classification of the Orland Park home as
non-marital property. We remand for recalculation of the home's value, for a
determination of any credits due to petitioner's non-marital estate, and for equitable
distribution of the home as a marital asset. We also reverse the 25-mile residence
restriction imposed on respondent. The remainder of the trial court's judgment is
affirmed.
For the reasons stated above, the judgment of the circuit court is affirmed in part,
reversed in part and remanded.
Affirmed in part and reversed in part; cause remanded.
McDADE and LYTTON, J.J., concur.
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In re: Marriage of Samardzija
Court: Appellate Court of Illinois
Date filed: 2006-06-09
Citations: 365 Ill. App. 3d 702
Copy Citations