Court Opinion

ID: 9732080
Source: CourtListenerOpinion
Date Created: 2023-08-26 16:06:57.191889+00
Date Added: 2024-06-11T18:26:23.035949
License: Public Domain

JUSTICE O’MALLEY, dissenting: The majority holds that the language from the dissolution judgment is unambiguous. Ambiguous or not, the quoted language does not address how the transfer of funds is to be effectuated or who is responsible for effectuating the transfer of the funds. Thus, the legal maxim that parol evidence will not be used to interpret an unambiguous agreement does not help resolve the present dispute, which centers on affixing the responsibility (and thus the consequences) for the failure to timely transfer the money. The dissolution judgment simply recites that the funds shall be transferred; it does not affix responsibility upon Gregory to effectuate the transfer. In fact, the record amply supports the notion that both Gregory and Mary had to take action to effectuate the transfer. The trial court recognized this joint responsibility when it chose the wording of the dissolution judgment and when it made its express findings allocating the responsibility for the failure of the transfer to occur. The flaw in the majority’s analysis also is revealed in the remand instructions directing the trial court to enter an order requiring the transfer of $725,000 from Gregory’s IRA to Mary. What if the IRA has diminished in value below $725,000? If that were to occur, the propriety of the trial court’s detailed allocation of the responsibility for the failure to follow its order to transfer the money would be quite clear. Such allocation is just as proper even if the value of the fund has not diminished below $725,000. Interpreting the terms of a marriage settlement agreement is a matter of contract construction. Wenc, 294 Ill. App. 3d at 243. One principle of contract construction is that a contract will not be construed to permit an absurd result. Rubin v. Laser, 301 Ill. App. 3d 60, 68 (1998). Another is that a contract should be given a fair and reasonable interpretation based upon all its language and provisions. Fox v. Commercial Coin Laundry Systems, 325 Ill. App. 3d 473, 475 (2001). The value of Gregory’s IRA obviously is variable; if the majority’s reading of the marriage settlement agreement would result in an absurdity in a scenario that hardly is remote from the facts before us, I dispute the soundness of that interpretation. The majority states that “[a] trial court does not abandon its equitable powers over the parties and the subject matter simply because the parties have entered into a marital settlement agreement.” 332 Ill. App. 3d at 660. However, the majority does not consistently apply equitable principles in its analysis. The majority does not dispute the trial court’s finding that Mary solely was responsible for the depreciation of the IRA that occurred between the date of the dissolution judgment and September 1, 2000, that both Gregory and Mary were responsible for the depreciation that occurred between September 1, 2000, and September 28, 2000, and that Gregory solely was responsible for the depreciation that occurred after September 28, 2000. Based on these findings, the majority considers it equitable and just to award Mary postjudgment interest only for the latter period. However, the majority apparently considers these findings irrelevant to another question of equity: Who was responsible for, and hence who should bear the consequences of, the IRA’s diminution in value between the date of the dissolution judgment and the date of the transfer of the funds? The finding that Mary solely was responsible for a certain period of time means that Gregory could not have transferred the $725,000 to Mary during that period of time. In other words, even if Mary unambiguously was entitled to have $725,000 transferred to her from Gregory’s IRA, it would be patently unfair to saddle Gregory with the loss incurred during that period of time. If Mary solely was responsible for the funds being left in Gregory’s IRA, then she, as the trial court found, solely is responsible for the diminution in value during that period of time. Given that Mary solely was responsible for a certain period of time and jointly responsible for another period of time for the failure to transfer the funds to her, the trial court’s decision that she should share in any diminution during those times in accordance with her percentage of ownership was appropriate. In fact, if her conduct prevented Gregory from removing his share of the value of the diminishing IRA, she arguably is responsible for the diminution in value of his share as well. As noted, the agreement is silent as to who has what duties to cause the transfer of the funds. Even if Gregory had a duty to transfer the funds to Mary, however, she had a duty to cooperate in the transfer. Every contract contains an implied covenant of good faith and fair dealing. Northern Trust Co. v. VIII South Michigan Associates, 276 Ill. App. 3d 355, 367 (1995). This covenant includes the condition that, whenever the cooperation of one party is necessary for the other party’s performance, such cooperation will be given. See Kipnis v. Mandel Metals, Inc., 318 Ill. App. 3d 498, 505 (2000). The failure to perform a contractual obligation is excused where the other party prevents performance. See Barrows v. Maco, Inc., 94 Ill. App. 3d 959, 966 (1981). The trial court found, and the majority agrees, that Mary was solely responsible for the delay that occurred between the date of the dissolution judgment and September 1, 2000. By failing to initiate the transfer of the funds, she violated the implied covenant of cooperation and excused Gregory’s nonperformance during that period. The majority relies on Gregory’s interpretation of the marital settlement agreement. Asked during his testimony at the prove-up if he understood that the portion of the IRA that Mary was given under the settlement agreement would not be affected by market fluctuations, Gregory replied in the affirmative. However, Gregory’s opinion is not relevant to the issue at hand because he was not asked whether he believed Mary’s share would be affected by market fluctuations that occurred during a delay in the transfer of the funds for which Mary solely was responsible. For the foregoing reasons, the majority’s position is not supported by principles of contract law. Nor does equity permit Mary, who had delayed the transfer of the funds, to avoid any share in the loss in the IRA’s value that occurred during the delay. She who requests equity must do equity. Peddinghaus v. Peddinghaus, 314 Ill. App. 3d 900, 907 (2000). That is, “ ‘[g]ood faith, conscience, and reasonable diligence of the party seeking its relief are the elements that call a court of equity into activity’ [citations]” (Huszagh v. Holloway, 116 Ill. App. 2d 455, 464 (1969)). In my view, Mary has proved her claim to the sum of $725,000 under neither contract principles nor equity. Rather, the legal or equitable principles relevant to this case all support the trial court’s allocation of the IRA funds.