delivered the opinion of the court:
Robert Henry Schmidt (Robert) appeals a judgment of the circuit court of Sangamon County dissolving his marriage to Lynn I. Schmidt (Lynn). On appeal, Robert argues (1) the trial court’s distribution of assets was against the manifest weight of the evidence, (2) the trial court erred in ordering him to pay a portion of Lynn’s attorney fees, (3) the trial court should have found dissipation and directed Lynn to reimburse the marital estate for the cash assets she had in her possession at the time of the separation, (4) the trial court erred in its order altering the visitation that existed during the separation, and (5) the trial court erred in ordering him to pay medical expenses incurred by Lynn during the separation. We affirm and remand.
Robert and Lynn were married July 8, 1978, in Menard County, Illinois. A child, Lauren, was bom to them September 10, 1980. The parties separated September 19, 1986. Robert filed a petition to dissolve the marriage and Lynn filed a counterpetition. Robert’s petition was later dismissed and the parties proceeded on Lynn’s counterpetition. A judgment of dissolution of marriage was entered September 26,1991.
Robert runs the day-to-day operation of his father’s roofing and sheet metal business, Schmidt Brothers Roofing. According to Robert, he makes approximately $600 per week or $31,200 per year. From 1980 through 1985 (the years before the separation), Robert made $56,500, $56,000, $56,000, $61,000, $61,925, and $69,581 per year, respectively, or an average of $60,186 per year. From 1986 through 1991 (the years after the separation), Robert made $36,800, $31,200, $31,200, $31,200, $31,800 per year, respectively, or an average of $32,440 per year. Robert claims that much of his income in the early 1980’s came from bonuses but, because the roofing business has taken a downturn, he had not received a bonus since 1985. Lynn works as a real estate salesperson for John B. Clark, Realtor, in Springfield. From 1987 through 1990, her income was $38,141, $38,789, $33,649, and $30,804 per year, respectively.
During the marriage, the parties lived in a home that Lynn had purchased with her prior husband. It had been awarded to her in the dissolution of that marriage, subject to the payment of $5,400 to the former husband as his share of the real estate. Robert paid Lynn’s former husband $1,300 in partial payment, and the balance came from forgiveness of past-due child support and maintenance. Title was transferred to Robert and Lynn in joint tenancy. Lynn estimated that at the time of her marriage to Robert the house was worth between $76,000 and $79,000. At that time, Robert and Lynn obtained a new mortgage of approximately $50,500.
During the marriage Robert and Lynn embarked on an extensive and costly remodeling of the house. Lynn claimed the project got out of control and that Robert “ran the show.” Over a period of eight years the parties wrote checks to different suppliers in an amount exceeding $132,000. Included in that amount was $11,767.55 paid to Schmidt Brothers for roofing work. Robert also claims that between 1978 and 1981 the parties ran $41,984.99 through the books of Schmidt Brothers for subcontractors and materials for the house, which was paid by the execution of a promissory note dated November 21, 1986, from Robert to Schmidt Brothers. Robert claims the total of the amounts expended on the house for remodeling was $185,752.54. Lynn argues that much of the money filtered through Schmidt Brothers was not spent on home improvement but on other items, such as the payment of Robert’s parking tickets, car insurance, camera purchases, and for other, unknown purposes. Lynn testified that although the account had apparently been opened in 1979, she was not made aware of it until after the account had a balance due of over $41,000 which, according to the ledger sheet, was in 1982.
Robert claims that the remodeling was generally financed with money that came from his parents, as well as money he had prior to the marriage. At the time of the marriage, Robert had cash in checking and savings accounts in excess of $31,000, all of which he claims to have put into the remodeling
Between the date of the marriage and the separation, Robert’s parents made $38,600 in gifts to Robert and Lynn on special occasions such as birthdays, anniversaries and holidays. In addition to those gifts, Robert’s parents allegedly loaned substantial sums of money to Robert and Lynn. These alleged loans may be placed into two categories. The first is a category where notes were obtained at the time of the transfers; the second is a category where no notes were obtained until after the parties’ separation. The first category amounted to a total of $35,000, plus $22,284.99 of interest as of the trial. The second category amounted to a total of $30,500, plus $9,290.71 of accumulated interest on previous loans (as mentioned within the note) and $10,555.56 of accumulated interest from the time of the note’s execution through trial.
The first category of transfers is comprised of seven notes, each for $5,000, bearing a 6% interest rate, and signed by Robert and Lynn. Lynn testified to signing one of the notes while “holding a baby in one hand and frying chicken in the other.” She said that Robert told her the documents were to memorialize the fact that his parents were giving more money to them than to Robert’s brother and his wife. Lynn further testified that there was no intent to repay Robert’s parents and that no interest rate was filled in on the documents at the time she signed them.
As to the second category of transfers, Robert contends that he and Lynn frequently approached his parents for additional money. Lynn testified, however, that she could not remember a single instance when Robert asked his parents for money in her presence. Robert’s parents transferred, by checks made out to Robert and dated before 1985, an additional $30,500 to Robert and Lynn. Robert’s father testified that he prepared a note regarding these transfers and had it signed by Robert after the separation. The amounts of these loans, unlike those in the first category, varied from $1,000 to $5,000 each.
At the time of the separation, Robert and Lynn had just over $4,500 in their joint checking account, of which Lynn removed $4,500. During the separation Robert borrowed over $45,000 from Magna Bank. Robert contends this money was spent on attorney fees, State and Federal taxes, interest on his accumulating debt, insurance on the home, real estate taxes, and a child therapist for Lauren. Robert also accumulated retirement funds totaling approximately $47,000, of which he contends $26,410 is marital property.
The trial court did not differentiate marital from nonmarital property or specify any values for the marital assets in its memorandum opinion and the subsequent judgment order. The court did not specifically address whether the transfers of monies from Robert’s parents were gifts or loans, but assigned responsibility for the notes and loans payable to Schmidt Brothers and to Velma and Ed Schmidt to Robert. Robert made no request that the trial court specifically identify or value marital property or explain whether the transfers were loans or gifts. The court awarded each party the things in his or her possession, apart from specific items and half the photographs, which were awarded to Lynn. The court ordered the house be sold and the net proceeds divided, and provided alternatively that if Robert wanted to purchase the house, he could buy Lynn’s share for $65,000. The court did not compute the net marital estate. The court order did not require payment of maintenance to either party and awarded permanent custody of Lauren to Lynn with visitation rights to Robert. Robert was ordered to pay $425 per month to Lynn for child support and he was also ordered to keep and maintain a policy of medical insurance covering Lauren. Based upon Lynn’s request that she
Initially, Robert contends the trial court erred in its distribution of assets in holding him individually responsible for the debts to his parents and Schmidt Brothers. A trial court’s distribution of marital property should not be reversed absent a showing that the trial court abused its discretion, i.e., no reasonable person could adopt the trial court’s position. (In re Marriage of Kerber (1991),
The central property division concern in this case is the role the claimed “loans" from Robert’s parents should play in the distribution of the marital estate. If the monies from the Schmidt family and from Schmidt Brothers were gifts, then the distribution of the marital estate was essentially equal and Robert concedes that he would have no quarrel. On that basis the marital estate, according to Robert’s post-trial motion, is as follows:
Assets VALUE LYNN ROBERT
Real Estate $166,556 $ 83,278 $ 83,278
Individual Retirement Account (IRA)/Simplified Employee
Pension (SEP) 11,844 11,844
Merrill Lynch IRA 6,216 6,216
Merrill Lynch IRA 5,390 5,390
Shearson SEP 2,960 2,960
Robert’s household 2,612 2,612
Lynn’s household 2,180 2,180
Lynn’s jewelry 6,731 6,731
Lynn’s Cadillac 13,000 13,000 _
TOTAL $217,489 $105,189 $112,300
Liabilities
Mortgage $ 28,356 $ 14,178 $ 14,178
Promissory Note 8,200 4,100 4,100
Robert’s Visa 1,675 1,675
Robert’s Mastercard 1,282
Cadillac Note 9,622 9,622
Lynn’s credit card 5,032 5,032 _
TOTAL $ 54,167 $ 32,932 $ 21,235
NET MARITAL ESTATE $163,322 $ 72,257 $91,065
Robert contends that if, however, the notes were bona fide debts, or if the loans were an advancement against his inheritance, then the distribution of the marital estate would be grossly disproportionate. Robert argues the only significant difference between the parties is that he may someday inherit a substantial sum of money from his parents. Potential inheritances are not property which can be valued and awarded to a spouse, although they can be given some consideration in determining property distribution. (In re Marriage of Eddy (1991),
A valid gift requires proof of donative intent and delivery of subject matter. {In re Marriage of Brown (1982),
Trial courts are rightly skeptical of transfers by the parents of one of the litigants in a dissolution case. There is an incentive for both sides of the transfer, the parents making it and the litigant receiving it, to conform their testimony to the disadvantage of the other litigant. Transfers where the parents would never have sought repayment, if the marriage had remained intact, may be viewed from a different perspective when the marriage falls apart. (See In re Marriage of Jacks (1990),
While it is impossible to tell, from the trial court’s order, whether it considered the parental transfers to be loans or gifts, there was sufficient evidence from which the trial court could have determined that the bulk of the transfers were gifts to the marriage, and the trial court’s decision may be affirmed on that basis. Certainly the $38,600 of gifts made on special occasions during the marriage were just that — gifts—and the trial court would have been justified in finding that the gifts were to the marriage, not to Robert individually. Likewise the $30,500 of notes (with $19,846.27 of interest) which were not signed contemporaneously with the transfers, but signed only by Robert after the parties’ separation, was suspicious; a finding that the transfers were in fact gifts, and gifts to the marriage, would not be contrary to the manifest weight of the evidence.
The best argument that the parents made loans and not gifts to the parties involves the $35,000 (plus $22,284.99 interest) for which notes were signed at the time the transfers were made. Even with those notes, however, there was evidence upon which the court could have based a finding that what appeared to be loans were actually gifts to the marriage. Lynn testified the notes were never intended to be repaid, and set out no interest rate at the time she signed them. There was no evidence of any payments ever being made on the notes, either of interest or principal. Robert’s argument these notes were advancements is inconsistent with the idea that the notes had to be repaid. The trial court could have found the reason for executing the notes was to provide a record to be used in settling the estates of Robert’s parents, so that the gifts made to Robert and his siblings by their parents, both inter vivos and by succession, would be equal.
The fact the trial court ordered Robert to “be responsible for all notes and loans payable to Schmidt Brothers, Inc.,” or to his parents individually is not inconsistent with the trial court’s viewing these transfers as gifts. As explained above, treatment of the transfers as gifts in the dissolution of marriage action did not settle the matter between the parents and Robert, or for that matter, between the parents and Lynn. Finally, even were we to view the contemporaneous notes as a true debt of the marriage, we could not say that the trial court abused its discretion in requiring Robert to pay that full amount. Without considering any debts to Robert’s parents, the trial court awarded Robert about $19,000 more than was awarded Lynn. The $19,000 could reasonably have been viewed by the trial court as sufficient to compensate Robert for the questionable debt he was required to be responsible for.
The trial court may have taken into account the fact that in the years prior to the
Robert alternatively argues that if the trial court were correct in effectively removing the debt to the Schmidt family and to Schmidt Brothers from the marital estate, some recognition should be given the fact that the source of the “equity” in the house was gifts to him individually. However, even if the transfers were considered to be nonmarital property, i.e., gifts to Robert individually and not to the marriage, the funds lost their identity when they were invested in the house. That commingling resulted in a transmutation of the funds into the classification of the estate receiving the contribution (the house), which was marital property. (111. Rev. Stat. 1991, ch. 40, par. 503(cXl).) Robert might have been entitled to reimbursement from the marital estate, if he (1) established he did not make a gift to the marital estate, and (2) retraced the contribution by clear and convincing evidence. (111. Rev. Stat. 1991, ch. 40, par. 503(c)(2).) Robert did not establish a right to reimbursement in this case.
Next, Robert contends the trial court erred when it directed him to pay $12,500 of Lynn’s $28,000 attorney fees incurred in the dissolution proceedings. Robert contends that in light of the distribution of the marital assets, the relative earnings of the parties, and the debt he incurred with his previous attorney, the direction that he pay a portion of Lynn’s attorney fees was an abuse of discretion. Lynn argues that she is not able to incur more of these fees, and that Robert has paid most of his attorney fees and has had no difficulty obtaining money to do so.
The trial court in dissolution cases has the authority, after considering the financial resources of the parties, to order either spouse to pay a reasonable amount of the costs and attorney fees incurred by the other spouse. (111. Rev. Stat. 1989, ch. 40, par. 508.) The awarding of attorney fees and the proportion to be paid are within the sound discretion of the trial court and will not be disturbed on appeal, absent an abuse of discretion. In re Marriage of Bussey (1985),
The propriety of an award of attorney fees is dependent upon (1) a showing by the party seeking them of an inability to pay, and (2) a demonstration of the ability of the other to do so. (Bussey,
Next, Robert contends that the trial court should have directed Lynn to reimburse the marital estate for the $4,500 she took from the parties’ joint account at the time of the separation. Robert contends Lynn cashed in an IRA that she had acquired during the marriage and deposited the money from both the IRA and their joint account into a personal account, giving her about $13,000 in cash. Robert argues that Lynn’s acts of using the money for nonmarital purposes amounted to dissipation under section 503(d)(1) of the Act (111. Rev. Stat. 1991, ch. 40, par. 503(d)(1)).
Whether there was dissipation is a question for the trial court and its determination will not be set aside absent an abuse of discretion. (Adams,
Lynn does not dispute the fact that at the time of the separation she placed approximately $13,000 into a personal account. She claims that much of the money was spent on support for Lauren, the parties’ daughter, as she did not receive any child support for at least seven months after the separation. She further claims a portion was spent in securing housing for herself, Lauren, and her two sons from a previous marriage, while Robert remained in the marital residence. In light of Lynn’s claims that she used the money to support Lauren and secure housing, on the facts here we cannot say that the trial court’s failure to find dissipation was an abuse of discretion.
Robert next challenges the visitation order. A temporary order governing Lauren’s custody during the separation was entered by the court and gave Lynn custody, granting Robert visitation every first, third, and fourth weekend of the month and on Wednesday evenings. During the summer Robert had every other week as visitation. During the trial court’s in camera interview, Lauren indicated that she would prefer visitation with Robert every other weekend instead of the first, third, and fourth weekends of every month. Consequently, the trial court’s order upon dissolution of the marriage gave Robert visitation alternate weekends during the school year and during the summer. It further provided that Robert would have visitation on Wednesday evenings until the following morning. During the summer months, the Wednesday visitation period would be switched to Thursday on the weekends when Robert had visitation and Lauren would remain with him from Thursday evening through the weekend. Robert would also have two uninterrupted two-week periods of visitation each summer, to be designated by Robert by May 1 of each year.
Robert contends that the two extended summer visitation periods, the dates of which he must designate in advance, are problematic. He argues summer is the busy time in the roofing business and his
Visitation should be designed to promote the best interests of the child. The trial court wisely concluded that a temporary order requiring the child to change residences every week during the summer would not promote stability in the child’s life and should not be the permanent solution. Lauren will be better able to plan her summer if Robert chooses his two weeks by May 1, but visitation can never work if the parties are inflexible and uncooperative. We trust that will not be the case here. Matters of child custody and visitation rest largely in thé broad discretion of the trial court, and its determinations with respect thereto will not be disturbed on appeal unless a manifest injustice has been done. (Rodely v. Rodely (1963),
Last, Robert claims that the trial court erred in ordering him to pay the medical expenses incurred by Lynn during the separation. The order granting temporary custody and other temporary relief did not mention medical insurance. Lynn contends it was understood between herself, Robert, and the court that Robert was to maintain medical insurance for Lynn and Lauren. Robert admitted at trial that he did maintain medical insurance for both Lynn and Lauren. However, he requested that the insurance company not pay any medical expenses to ensure that any bills would “come through” him. A letter, admitted into evidence at trial, from the insurance company to the Springfield Clinic, where Lauren had been treated for an illness, read, in pertinent part, as follows: “We have received expenses relating to the injury/illness incurred on July 07, 1990[,] for Lauren. In accordance with Robert’s request, we will not be considering these expenses under your group health plan at this time.”
At trial, Lynn introduced a series of exhibits indicating that the medical expenses incurred for herself and Lauren were $1,238. The trial court ordered Robert to reimburse Lynn $1,238 for unpaid medical expenses. Robert claims he has no quarrel with paying Lauren’s medical expenses but he should not have to pay Lynn’s expenses. We conclude that the trial court did not abuse its discretion in ordering Robert to pay the medical expenses incurred by Lynn as well as Lauren during the separation, as it was in the best position to evaluate the responsibilities and the financial resources of the parties for such expenses.
For the reasons stated above, the judgment of the circuit court of Sangamon County is affirmed and remanded with directions for the circuit court to include in its order that Robert is responsible for any debts to his parents and Schmidt Brothers.
Affirmed and remanded with directions.
McCULLOUGH and KNECHT, JJ., concur.
