In re Marriage of Osborne
Case Date: 01/23/2002
Court: 3rd District Appellate
Docket No: 3-01-0252 Rel
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filed: January 23, 2002 No. 3--01--0252
APPELLATE COURT OF ILLINOIS THIRD DISTRICT A.D., 2002
JUSTICE HOLDRIDGE delivered the Opinion of the Court: Niky and Robert Osborne were divorced on August 31, 1979. The judgment of dissolution incorporated by reference a maritalsettlement agreement. In this agreement, Niky was named as theirrevocable beneficiary of six life insurance policies. Robertwas obliged to pay the premiums on five of these policies. Robert filed a "Petition to Terminate Support" seeking toterminate his obligation to maintain the policies. The courtdenied his petition and Robert appealed. We affirm. BACKGROUND The settlement agreement, titled "Separation Agreement,"referred to six life insurance policies in paragraphs 4, 18, 19,and 20. Paragraph 4 states that "[Niky] shall be the irrevocablebeneficiary on the childrens' [sic] life insurance policies, and[Robert] shall keep said policies in full force and effect." According to the judgment of dissolution of marriage, the couplehad two children. This paragraph, therefore, was referring totwo insurance policies, one on the life of each child. Paragraph 18 says that "[Niky] shall be made the irrevocablebeneficiary of the present existing policy at Deere and Company***." The record reflects that Robert was employed at Deere andCompany, which paid the premiums on that life insurance policy,and that the policy was payable at Robert's death. In paragraph 19, the agreement reads that "[Robert] shallcancel the present insurance policy that he has on the realestate of the parties *** and shall replace the same with a$70,000.00 adjustable term policy and [Niky] shall be theirrevocable owner and beneficiary of said policy." Paragraph 20states that "[Niky] shall be the irrevocable beneficiary andowner of the policies presently in Connecticut Mutual andOccidental Life, and [Robert] shall pay the premiums thereon asthe same accrue." The policies referred to in paragraphs 19 and20 were payable upon the death of Robert. In Robert's petition, he argued that the purpose ofmaintaining these life insurance policies was to provide supportfor his children in the event of his death until they wereemancipated. At the time of his petition, Robert stated thatboth children were over 22 years of age and without need ofsupport. He asked the court to terminate his obligation tomaintain these insurance policies. In his brief in support ofhis petition, Robert stated that premiums for the Occidental lifeinsurance policy increase each year such that "the increase fromthis point forward becomes very dramatic." At the hearing on thepetition, Robert's attorney stated that Robert was payingapproximately $3,570 in annual premiums for four of the policies,of which $3,045 was for the Occidental policy. The court denied Robert's petition. In its order, the courtexplained that the pertinent provisions of the agreementunambiguously named Niky as the irrevocable beneficiary of thelife insurance policies. The court stated that these provisionswere contained in paragraphs that were separate from theprovisions for child support. The court noted that the agreementdid not state that the life insurance policies were security forchild support or maintenance. As a court of equity, the court order authorized Robert tosubstitute a term life insurance policy "for the existingTransamerica Occidental Life Insurance policy *** in order toprovide [Robert] the opportunity to reduce or lower the annualpremiums at a level rate as opposed to the present escalatingrate." Robert appeals from the denial of his petition. ANALYSIS General contract rules apply to the interpretation ofmarital settlement agreements when the trial court considers amotion to terminate support. When interpreting a maritalagreement, the court must ascertain and give effect to theparties' intent. The language of the marital agreement is thebest indication of the parties' intent. When the terms of amarital agreement are clear and unambiguous, the court must givethese terms their ordinary and natural meaning. An ambiguousterm is one that is susceptible to multiple meanings orinterpretations. Whether a term is ambiguous is a question oflaw that we review de novo. In re Marriage of Hahn, 324 Ill.App. 3d 44, 754 N.E.2d 461 (2001). On appeal, Robert relies upon In re Marriage of Tieman, 237Ill. App. 3d 847, 604 N.E.2d 1098 (1992), for the propositionthat life insurance on the life of a non-custodial father, andhis obligation to pay the premiums, is for the purpose ofsecuring his child support obligation. In Tieman, under thetrial court's order, the father was obligated to maintain a lifeinsurance policy on his life with the children as beneficiariesuntil the youngest attained 18 years of age. The oldest of thethree children was 21 years old. The father sought to reduce theamount of life insurance he was to maintain by one-third. Thetrial court allowed this reduction. The appellate courtaffirmed, reasoning that life insurance naming a child asbeneficiary was intended to secure that child's support in theevent of the insured's death. In this case, Robert also looks to Reid v. Reid, 58 Ill.App. 2d 357, 208 N.E.2d 1 (1965), upon which Tieman relied. InReid, the settlement agreement stated that the father was tomaintain life insurance policies on his life to pay for thesupport, college, or graduate school expenses of his children. The children were to be named as irrevocable beneficiaries ofthese policies. The father petitioned the court to substituteone set of life insurance policies for another set of policies. The trial court permitted the father to make the substitution. The appellate court affirmed, ruling that the father'ssubstitution of insurance policies fulfilled the purpose ofproviding security for the children's college and graduateeducations. Both Tieman and Reid are readily distinguishable from theinstant case in that the children in those cases unambiguouslywere named as beneficiaries of the life insurance policies. Furthermore, in both cases, the courts' orders included clear andunambiguous language indicating that the proceeds from the lifeinsurance were for specific purposes for the children. InTieman, the life insurance was to benefit the children until age18. In Reid, the life insurance was to benefit the childrenuntil they had completed college and graduate school. In the present case, Niky, not the children, wasunambiguously named as the irrevocable beneficiary of thepolicies. In interpreting the marital settlement agreement, thecircuit court gave the language of the agreement its ordinary andnatural meaning. This meaning was the best indication of theintent of the parties at the time of dissolution. Contrary to Robert's assertions, nothing in the plainlanguage of the agreement indicated that his obligation tomaintain these life insurance policies was meant as considerationfor child support or spousal maintenance. As a matter of law wehold that the circuit court did not err by denying Robert'spetition to terminate support. Furthermore, the trial courtruled equitably by modifying the settlement agreement to provideRobert with relief from the escalating premium payments of one ofthese life insurance policies. CONCLUSION For the foregoing reasons, we affirm the ruling of the RockIsland County circuit court. Affirmed. BRESLIN and SLATER, JJ., concur. |
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