In re Marriage of Hulstrom

Case Date: 07/29/2003
Court: 2nd District Appellate
Docket No: 2-02-0960 Rel

No. 2--02--0960


IN THE

APPELLATE COURT OF ILLINOIS

SECOND DISTRICT


In re MARRIAGE OF
EVERETT E. HULSTROM,

          Petitioner-Appellant,

and

ILA J. HULSTROM,

          Respondent-Appellee.

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Appeal from the Circuit Court
of Lee County.



No. 94--D--90

Honorable
David T. Fritts,
Judge, Presiding.


JUSTICE BYRNE delivered the opinion of the court:

Petitioner, Everett E. Hulstrom, appeals from the order of thecircuit court denying his petition to modify the judgmentdissolving the parties' marriage. We reverse as void the portionof the dissolution judgment dividing the marital property, and weremand the cause with directions.

FACTS

On August 19, 1994, the trial court dissolved the parties' 46-year marriage and incorporated their marital settlement agreementinto the judgment. At the time of the dissolution, petitioner andrespondent, Ila J. Hulstrom, were 67 and 65 years old,respectively, and each was receiving social security benefits. Themarital settlement agreement provides in relevant part:

"1. The Social Security paid on behalf of [petitioner] and[respondent] shall be combined monthly and paid to[respondent], where, on the tenth of each month, one-half ofthe combined Social Security payment shall be deposited bydirect deposit from [respondent's] account into an accountdesignated by [petitioner]. To the extent that such SocialSecurity payments to either party are income, and to such anextent that the party who receives the greater amount ofSocial Security receives income from the party to whom thegreatest amount of Social Security is paid, that amount ofSocial Security shall be income to the receiving party to theextent that it was income to the paying party.

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8. To the fullest extent provided by law, each party waivesmaintenance now and all times in the future."

On May 24, 2002, petitioner petitioned to modify the portionof the judgment allocating the social security benefits. Petitioner alleged that paragraph 1 of the settlement agreement"purports to distribute a Social Security benefit as a propertyright when, in fact and in law, it is a support matter." Petitioner alleged that the parties should no longer share theirsocial security benefits because (1) petitioner's income haddecreased significantly; (2) his medical expenses had increased dueto his failing health; (3) respondent had remarried and wasfinancially secure; and (4) paragraphs 1 and 8 of the settlementagreement were inconsistent.

At a hearing on the petition, petitioner testified to hisdeclining income and deteriorating health, including a form ofParkinson's disease from which he suffers. Petitioner andrespondent had each remarried, but respondent did not notifypetitioner of her remarriage.

On July 25, 2002, the trial court denied the petition tomodify the judgment, finding that the parties had followed thesettlement agreement for eight years and had never treated theequal division of social security benefits as maintenance. Thecourt concluded that respondent's remarriage would not end herright to one-half of the couple's benefits because the parties hadviewed them as marital property. The court emphasized that theparties considered the equal division of benefits when dividing theremaining marital assets. The court denied petitioner's subsequentmotion to reconsider on August 30, 2002, and petitioner timelyappealed on September 4, 2002.

ANALYSIS

On appeal, petitioner argues that the trial court erroneouslydetermined that the equal division of the parties' social securitybenefits was an unmodifiable distribution of marital property,rather than a modifiable maintenance obligation that terminatedautomatically upon respondent's remarriage. Petitioner presentstwo theories on appeal: (1) because state trial courts lackjurisdiction to order the division of social security benefits inmarriage dissolution cases, the marital settlement agreementdisposing of the parties' social security benefits may not beenforced; and (2) even if the circuit court had jurisdiction overthe issue, the social security benefits qualify as "maintenance"rather than "marital property" under the Illinois Marriage andDissolution of Marriage Act (Marriage Act) (see 750 ILCS 5/503(a),504(a) (West 2000)).

Respondent alternatively contends that (1) the agreement'ssocial security provision is a valid allocation of marital propertyrather than a description of petitioner's prospective maintenanceobligation and (2) if this court decides that the provision isinvalid, a new hearing is necessary for the redistribution of themarital assets.

The issue of whether a state trial court lacks jurisdiction toenforce the provision of a marital settlement agreement dividingsocial security benefits is a question of first impression inIllinois. However, two other jurisdictions have ruled that asettlement agreement dividing such benefits as marital property isvoid for violating the anti-alienation provision of the SocialSecurity Act (42 U.S.C.