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 May 14, 2008 Wednesday

SECTION: Pg. 10001

LENGTH: 1928 words

BYLINE: STEVEN P. GARMISA

BODY: 

Validating common practice, the Illinois Supreme Court approved use of declaratory judgments during marriage dissolution proceedings.

Hitched in 2002 after executing a premarital agreement, Angela and Steven Best had a baby in 2003, but then in 2004 the husband petitioned for dissolution of the marriage. As part of the divorce proceedings, Steven Best filed a "motion for declaratory judgment" on the validity of the prenuptial accord.

A Lake County judge ruled that the contract is valid and enforceable -- though the judge also concluded that a waiver of Angela Best's right to seek reimbursement of legal fees did not apply to proceedings concerning child custody.

Deciding to make this order immediately appealable, the judge also issued a special finding under Supreme Court Rule 304(a). Meanwhile, Angela Best asked for an order commanding Steven Best to provide health insurance.

The husband's response argued that the wife waived any claim to insurance benefits, based on a provision in the premarital agreement relinquishing her right to maintenance or support "in the event the parties separate or the marriage is dissolved."

The wife's reply asserted that this waiver applied only if the two were "legally separated."

Agreeing with the wife, the trial judge ordered the husband to provide insurance coverage.

On appeal from these orders, the 2d District Appellate Court spontaneously decided that Steven Best was not entitled to a declaratory judgment. According to the Appellate Court, his request did not satisfy the second requirement of the Declaratory Judgment Act: that the declaratory order "terminate the controversy or some part thereof."

Reversing in part, the Supreme Court concluded that (1) the order on validity of the premarital agreement was immediately appealable, despite Marriage of Leopando, 96 Ill.2d 114, 119 (1983); (2) all the requirements of the Declaratory Judgment Act were satisfied; and (3) Angela Best's waiver of the right to support applied only in the event of dissolution or legal separation. In re Marriage of Best, 2008 WL 733225 (March 20).

Here are highlights of Justice Thomas L. Kilbride's opinion (with omissions not noted in the quoted text):

"In discussing the suitability of appealing the declaratory judgment under Rule 304(a), the Appellate Court examined whether the declaratory judgment request raised a claim separate from the pending dissolution claim.

"The court held that here it did despite the contrary result reached in In re Marriage of Leopando, 96 Ill.2d 114, 119 (1983). We agree that this case is appealable under Rule 304(a) and distinguish Leopando.

"In Leopando, the trial court entered an order dissolving the parties' marriage, followed by a separate order awarding permanent custody of the couple's child to the father. The only statute at issue was the Illinois Marriage and Dissolution of Marriage Act.

"The custody order included a finding of `no just reason to delay enforcement or appeal' under Supreme Court Rule 304(a). The custody order also expressly reserved the issues of maintenance, property division and attorney fees.

"Affirming the Appellate Court's reversal of the custody order as not appealable under Rule 304(a), this court explained that custody is not a separate claim in a dissolution case but rather a separate issue, ancillary to the single claim presented in the dissolution proceeding. Leopando, 96 Ill.2d at 119.

"The facts in this case are quite different. In relevant part, the declaratory judgment order here determined only the validity of the parties' premarital agreement and the construction of section 19, the provision waiving attorney fees, matters implicating both the declaratory judgment statute and the Illinois Uniform Premarital Agreement Act.

"Consistent with the scope of the declaratory judgment statute, the order did not make any actual awards in the pending dissolution case, unlike the order in Leopando. Indeed, in Leopando, the challenged order actually awarded permanent custody to the father. In addition, Leopando did not involve a premarital agreement or request for relief outside that provided by the Marriage Act.

"Furthermore, the only true `claim' at issue in the dissolution proceeding in Leopando was `a request for an order dissolving the parties' marriage' under the Marriage Act.

"Thus, the custody order entered by the trial court was not appealable under Rule 304(a) because it merely resolved one issue unaddressed by the initial dissolution order.

"As we explained, `the numerous other issues involved, such as custody, property disposition and support are merely questions which are ancillary to the cause of action' seeking dissolution of the parties' marriage. Leopando, 96 Ill.2d at 119.

"To demonstrate the inherent interrelatedness of those other issues to the only claim pending before the court, namely the parties' dissolution, we noted that no relief was available on any issue if the trial court declined to grant the dissolution petition.

"In contrast, here Steven sought non-declaratory relief under the Marriage Act, as well as declaratory relief under the declaratory judgment statute. His request for non-declaratory relief sought dissolution of the parties' marriage.

"His declaratory judgment request asked the court to address the validity and construction of the parties' premarital agreement. Contrary to Leopando, the two requests for relief here had distinctly different statutory bases.

"Moreover, if the statutory requirements were met, Steven's declaratory judgment could be entered even if the dissolution petition were not granted. In addition, unlike Leopando, the challenged order did not actually make any award to either party.

"When, and if, the trial court awards attorney fees in the pending dissolution proceeding, then the appealability of that award under Rule 304(a) may present an issue similar to the one raised in Leopando.

"We need not decide that question now, however, because no attorney fee award was, or could have been, entered in the declaratory judgment.

"Under the facts and circumstances in this case, the request for dissolution of the parties' marriage and the request for declaratory judgment on the validity and interpretation of the premarital agreement are not so closely related that they must be deemed part of a single claim for relief, as they were in Leopando. Thus, Leopando is distinguishable."

Statutory Construction

"We now reach the issues raised by Steven in this case. He suggests that the Appellate Court erred by holding that the termination-of-controversy requirement of the declaratory judgment statute was not met.

"Thus, we examine the declaratory judgment statute to determine whether that requirement was satisfied. Construction of a statute presents a question of law to be reviewed de novo."

Kilbride continued, "Section 2-701(a) of the declaratory judgment statute states: `No action or proceeding is open to objection on the ground that a merely declaratory judgment or order is sought thereby. The court may, in cases of actual controversy, make binding declarations of rights, having the force of final judgments, whether or not any consequential relief is or could be claimed, including the determination ... of the construction of any ... contract or other written instrument, and a declaration of the rights of the parties interested.' 735 ILCS 5/2-701(a).

"Nonetheless, entry of a declaratory judgment is improper if it `would not terminate the controversy or some part thereof, giving rise to the proceeding.' 735 ILCS 5/2-701(a).

"We note that section 105(a) of the Marriage Act incorporates our Civil Practice Law. Thus, the legislature expressly provided for the entry of declaratory judgments in dissolution cases.

"Applying these statutory provisions, a declaratory judgment of the parties' rights under the premarital agreement is proper if: (1) there is an actual controversy; and (2) entry of a declaratory judgment would terminate `some part' of that controversy. It is undisputed that an actual controversy exists, thus satisfying the first criterion. Thus, our review is limited to the second statutory criterion: whether the declaratory judgment would end `some part' of the parties' controversy.

"Steven sought to obtain a declaratory ruling on the validity, scope and application of the premarital agreement's provisions.

"Undoubtedly, the degree of control the agreement ultimately exerts over the parties' rights in the underlying dissolution proceeding depends on the validity and final construction of its provisions. That construction will determine whether the agreement controls various facets of the parties' rights in the pending dissolution proceeding.

"Construing the agreement will indeed terminate a significant part of the parties' controversy. No question of whether the agreement's provisions provide the controlling authority over the parties' dissolution rights will remain.

"Thus, we conclude that the second statutory criteria for entry of a declaratory judgment is met.

"Our conclusion is consistent with section 4 of the Illinois Uniform Premarital Agreement Act.

"Section 4 allows the parties to a premarital agreement to contract on: (1) their property rights and obligations; (2) their rights to take specific property actions; (3) the disposition of their property; (4) the elimination or modification of spousal support; (5) the making of agreements or arrangements intended to carry out the premarital agreement; (6) their life insurance benefits; (7) the law to be applied in construing the premarital agreement; and (8) any other matter not violating a criminal statute or public policy.

"Section 4 effectively permits parties to waive or modify their marital rights by entering into a valid premarital agreement. By entering into a premarital agreement under section 4, the parties in this case agreed that their enumerated rights at dissolution are no longer governed by statute to the extent that they are validly modified or waived in their agreement.

"Allowing the declaratory judgment before the final dissolution order undoubtedly upheld the parties' rights under the act to enter into a binding contract before marriage to control the outcome of many issues that could arise during their dissolution.

"Both Steven and the amicus offer the additional policy argument that the Appellate Court's ruling effectively bars the entry of declaratory judgment before trial and issuance of an order in the dissolution proceeding. They contend that this bar conflicts with common practice in cases involving premarital agreements and that it unnecessarily diminishes the efficiency of dissolution proceedings.

"While common practice is not determinative of the proper construction of a statute, our holding does comport with our trial courts' common practice of issuing declaratory judgments before entering an order in an underlying proceeding.

"We hold that a reviewing court may consider the validity and effect of a declaratory judgment order in a dissolution proceeding, even if it is entered before the final dissolution order, if the prerequisites of the declaratory judgment statute are met.

"Here, Steven's declaratory judgment request falls within the plain language of the declaratory judgment statute.

"The Appellate Court erred by refusing to review the merits of his claim that the trial court improperly construed the attorney fee waiver provision, section 19, of the premarital agreement.

"Thus, we reverse the portion of the Appellate Court judgment finding the declaratory judgment order not subject to review on appeal."

LOAD-DATE: May 15, 2008