2022 IL App (3d) 210291-U
Ill. App. Ct.2022Background
- Raymond and Felicia Trapp married in 2001; husband filed for dissolution in July 2018; trial on financial issues occurred August 4, 2020.
- Husband owned two entities: Ray Trapp Electric, Inc. (electrical contracting) and Trapp Properties, Inc. (two commercial rental buildings). CPA/business appraiser Neil Gerber produced valuations as of August 31, 2019.
- Gerber valued Ray Trapp Electric’s equity at $320,000 (trial court excluded $90,000 goodwill) and Trapp Properties’ net equity at $20,000 as of the valuation date; Gerber later testified equity likely increased by trial.
- Trial court awarded both businesses to husband, required him to pay wife $170,000 plus half of additional cash on hand and proceeds from surrendering two life-insurance policies; denied maintenance and ordered $60/month child support.
- Wife appealed, challenging the Trapp Properties valuation and asset distribution (including life policies, bank accounts, and debts) and the calculation of both parties’ incomes for child support/maintenance.
Issues
| Issue | Wife (Trapp) Argument | Husband (Trapp) Argument | Held |
|---|---|---|---|
| Valuation of Trapp Properties, Inc. | $20,000 valuation was against manifest weight; properties should be sold and proceeds split | Gerber’s valuation was competent and supported award to husband | Gerber’s valuation was competent; court’s distribution not abuse; trial-date equity increased to $51,454 — husband owes additional $15,727 to wife |
| Distribution of businesses & life-insurance policies | Properties should be partitioned/sold; one-half of life-policy cash values are marital property | Awarding businesses to husband with cash payment was equitable; policies funded by business so surrender ordered | Award of businesses to husband with cash payment was not abuse; life policies were marital — wife must be credited half; only $42,029 counted toward payment |
| Bank accounts and other debts (credit cards, vehicle deficiency) | Trial court erred by not equalizing accounts and debts | Some accounts belonged to husband’s father; wife’s credit card debt mostly incurred after separation | No abuse of discretion: contested accounts found to belong to father; overall debt division reasonable; husband ordered $5,000 toward wife’s attorney fees |
| Gross income for child support/maintenance | Include depreciation and personal business payments in husband’s income; deduct wife’s mandatory retirement contributions | Exclude inappropriate/accelerated depreciation; husband’s gross ≈ $64k; statutory limits on deductions | Child-support portion reversed and remanded: $38,496 of depreciation deemed includable and Ray Trapp Electric’s $23,021 ordinary business income includable; remand to recalculate husband’s income; wife’s retirement effectively considered via individualized tax calculation |
Key Cases Cited
- In re Marriage of Zwart, 245 Ill. App. 3d 567 (Ill. App. 1993) (division of marital property must be equitable but need not be mathematically equal)
- In re Marriage of Schneider, 214 Ill. 2d 152 (Ill. 2005) (appellate review of equitable distribution is abuse-of-discretion)
- In re Marriage of Gunn, 233 Ill. App. 3d 165 (Ill. App. 1992) (business valuation is an art, not a science)
- In re Marriage of Wojcik, 362 Ill. App. 3d 144 (Ill. App. 2005) (factual determinations of income reversed only if against manifest weight)
- Blackstone v. Blackstone, 288 Ill. App. 3d 905 (Ill. App. 1997) (both parties bear burden to present competent evidence of asset value)