Opinion
2-21-0754
04-13-2023
In re MARRIAGE OF LAWRENCE DANIEL FAUL, Petitioner-Appellant, v. JACQUELINE STACEY FAUL, Respondent-Appellee.
This order was filed under Supreme Court Rule 23 and may not be cited as precedent by any party except in the limited circumstances allowed under Rule 23(e)(1).
Appeal from the Circuit Court of DuPage County. No. 15-D-2302 Honorable Neal W. Cerne Judges, Presiding.
JUSTICE HUTCHINSON delivered the judgment of the court. Presiding Justice McLaren and Justice Jorgensen concurred in the judgment.
ORDER
HUTCHINSON, JUSTICE
¶ 1 Held: Petitioner's untimely § 2-1401 petition alleging a mutual mistake in the parties' marital settlement agreement was properly dismissed as untimely where petitioner failed to assert any adequate basis to excuse his late filing; however, as the circuit court did not specify the grounds for dismissal, we modify the order to state that the dismissal was with prejudice to collateral relief, but does not bar a potential claim for direct relief.
¶ 2 In this post-dissolution appeal, Lawrence Daniel Faul (Daniel), appeals from the denial of his petition to modify the dissolution judgment against his former wife, Jacquelyn Stacey Faul (Stacey), under § 2-1401 of the Code of Civil Procedure (the Code) (735 ILCS 5/2-1401 (West 2020)). Daniel contends that there was a mutual mistake of fact in the parties' marital settlement agreement, or MSA. Because the § 2-1401 petition was untimely, we affirm as modified.
¶ 3 I. BACKGROUND
¶ 4 Daniel and Stacey Faul, both investors, were married in 1989. They had two children, both of whom are now adults. Throughout Daniel and Stacey's marriage, they acquired several houses, some of which they used as residences and others that they rented out or used as investment properties. As a result, the majority of the parties' approximately $3.4 million marital estate was tied up in the equity for their various properties. In 2015, the parties cross-petitioned for dissolution and the parties entered into an MSA in November 2016.
¶ 5 The parties' dispute centers on the disposition of two of their houses, the marital home in Roselle, Illinois and a vacation home in Coloma, Michigan. The MSA provided that Daniel would stay in the marital home and Stacey would stay in the vacation home while each was awaiting sale. Relevant to this appeal, paragraph 2.18 of the parties' MSA provided as follows:
"2.18. Prior to the equal division between the parties of any net sale proceeds pursuant to Paragraphs 2.6 and 2.14, Danny shall receive from the net sale proceeds of the first to sell of either the marital residence or the Michigan residence the amount of thirty thousand dollars ($30,000) in exchange for his waiver of maintenance as set forth in Paragraph 1.2. In addition, in order to effectuate an equitable division of the marital estate: (1) if the parties sell the Michigan residence prior to selling the marital residence, Danny shall receive from the net sale proceeds of the Michigan residence the amount of one hundred fifteen thousand dollars ($115,000) prior to the equal division between the parties of any net sale proceeds pursuant to Paragraph 2.14; or (2) if, by contrast, the parties sell the marital residence prior to selling the Michigan residence, Danny shall receive from the
net sale proceeds of the marital residence the amount of forty-two thousand five hundred dollars ($42,500) prior to the equal division between the parties of any net sale proceeds pursuant to Paragraph 2.6, and Danny shall receive from the net sale proceeds of the Michigan residence the amount of seventy-two thousand five hundred dollars ($72,500) prior to the equal division between the parties of any net sale proceeds pursuant to Paragraph 2.14. As a result, the aggregate amount which Danny shall receive from the net sale proceeds of the marital residence and the Michigan residence for his waiver of maintenance and to effectuate an equitable division of the marital estate is one hundred forty-five thousand dollars ($145,000) prior to the equal division between the parties of any net sale proceeds pursuant to Paragraphs 2.6 and 2.14."
As we will see, payments between the parties did not strictly track the language of the MSA.
¶ 6 The Roselle property was sold in May 2017 for around $520,000 and in June 2017, Stacey paid Daniel approximately $72,500 from the combined proceeds. (We have rounded all figures where appropriate). Then, the Michigan property was sold in June 2020 for nearly $1 million. Upon the sale of the Michigan property, Daniel demanded that Stacey pay the remaining $72,500 out of her portion of the proceeds from the sale of the Michigan home, rather than the "first" $72,500 garnered from the sale. The parties' real estate attorney decided to hold $160,000 of the proceeds in escrow until the parties could resolve the matter.
¶ 7 On January 4, 2021, Daniel filed a § 2-1401 petition to "correct a mutual mistake of fact" as to whether his share of the real estate proceeds was to be paid directly from the sale or from Stacey's portion of the sale. Daniel acknowledged in the petition that it was filed some 31/2 years after the entry of the judgment, but suggested that the court could restore the parties' "actual agreement" and that Stacey's payment to him after the sale of the Roselle property "was of such character as to prevent inquiry, elude investigation, and mislead [him,]" which in turn caused him to "refrain[ ] from commencing the instant action within § 2-1401's two-year limitation period." Attached to the petition was correspondence from the parties' settlement negotiations as well as Daniel's affidavit. Stacey filed a combined motion to dismiss the § 2-1401 petition as untimely, and alleged that it failed to state a claim (735 ILCS 5/2-615 (West 2020)) and that it was barred as an affirmative matter (735 ILCS 5/2-619(a)(9) (West 2020)).
¶ 8 The trial court heard arguments and ultimately granted Stacey's motion to dismiss The court noted that, even taking the factual allegations in the light most favorable to Daniel, he had failed to identify a mutual mistake and failed to plead any of the exceptions to the two-year limitations period. The court, however, did not state whether dismissal was granted under § 2-615 or § 2-619. Daniel then timely filed this appeal.
¶ 9 II. ANALYSIS
¶ 10 On appeal, Daniel raises a number of arguments suggesting that his § 2-1401 petition should have been granted. None of those arguments, however, are availing.
¶ 11 Section 2-1401 of the Code "creates a comprehensive statutory procedure for obtaining relief from final orders and judgments more than 30 days after their entry." Price v. Philip Morris, Inc., 2015 IL 117687, ¶ 22. To be entitled to relief from a final judgment or order under § 2-1401, the petition must set forth specific factual allegations supporting each of the following elements: (1) the existence of a meritorious defense; (2) due diligence in presenting this defense or claim to the circuit court in the original action; and (3) due diligence in filing the petition. Smith v. Airoom, Inc., 114 Ill.2d 209, 220 (1986). The petition must also be supported by an affidavit or some other appropriate showing as to matters not of record. 735 ILCS 5/2-1401(b) (West 2016). Grounds for relief under § 2-1401 have traditionally included fraud and mutual mistake of fact, among others. In re Marriage of Hamm-Smith, 261 Ill.App.3d 209, 214 (1994).
¶ 12 Curiously, neither party directly addresses our standard of review. A § 2-1401 petition can present "either a factual or legal challenge to a final judgment or order." Warren County Soil &Water Conservation Dist. v. Walters, 2015 IL 117783, ¶ 31. If the petition raises a purely legal issue that does not involve a factual dispute, then equitable circumstances are inapplicable, and there is no need for the petitioner to establish a meritorious defense or satisfy the due diligence requirements. Id. ¶¶ 47-48. Under these circumstances, if the trial court enters judgment on the pleadings, then the reviewing court should apply a de novo standard of review. Id. However, if a § 2-1401 petition raises a fact-bound challenge to a final judgment, which requires a consideration of the equities underlying the case, then the trial court's ruling should be reviewed for an abuse of discretion. Id. ¶ 50.
¶ 13 Here, Daniel's § 2-1401 petition raised factual assertions in support of a legal challenge. In turn, the trial court made both factual findings and legal rulings. However, Daniel's petition was ultimately dismissed because the limitations period had expired. Because our analysis focuses on this legal determination, the order, we apply a de novo standard of review.
¶ 14 Initially, Daniel appears to assert that it was improper for the trial court to consider Stacey's combined motion to dismiss under § 2-615 and § 2-619 of the Code. Although § 2-1401 does not specifically refer to § 2-615 or § 2-619, they apply as a means to dismiss a § 2-1401 petition. "As an initial pleading, a section 2-1401 petition is the procedural counterpart of a complaint and subject to all the rules of civil practice that that character implies." In re Marriage of Little, 2014 IL App (2d) 140373, ¶ 8. Thus, a § 2-1401 petition may be dismissed pursuant to either § 2-615 or § 2-619 of the Code. Id.
¶ 15 Daniel next points out that the trial court did not specifically say whether his § 2-1401 petition was dismissed under § 2-615 or § 2-619 of the Code. While that information would have been helpful, it is really of no moment with respect to the petition's timeliness, or lack thereof. We may affirm a correct dismissal on any ground or "for any reason appearing in the record." Northern Trust Co. v. County of Lake, 353 Ill.App.3d 268, 278 (2004). Here, we select the expiry of the limitations period as it is a cognizable under either ground for dismissal. The running of a statute of limitations is normally an affirmative matter, suitable for dismissal under § 2-619. See, e.g., Cangemi v. Advocate South Suburban Hospital, 364 Ill.App.3d 446, 456 (2006). Thus, because Daniel's § 2-1401 petition, on its face, conceded that the limitations period had passed, Daniel was required to plead or replead either an exception or a period of repose to overcome that limit, yet he did not.
¶ 16 A § 2-1401 petition "must be filed not later than 2 years after the entry of the order or judgment" excluding any time that the movant "was under [(1)] legal disability or [(2)] duress or [(3)] the ground for relief [wa]s fraudulently concealed ***." 735 ILCS 5/2-1401(c). In addition, an allegation that the original judgment was void is not subject to the two-year limitations period (see People ex rel. Alvarez v. $59,914 United States Currency, 2022 IL 126927, ¶ 16 (citing Smith v. Airoom, Inc., 114 Ill.2d 209, 221-22 (1986)), but that narrow exception is inapposite here. Daniel does not allege that the judgment was void, but rather only voidable. See In re Marriage of Kuyk, 2015 IL App (2d) 140733, ¶ 16. Thus, Daniel was required to plead, within his complaint, either legal disability, duress, or fraudulent concealment to stave off dismissal for untimeliness. He failed to do so.
¶ 17 Although Daniel's § 2-1401 petition feints at the concept of fraudulent concealment, it is inapplicable. Generally, Daniel alleges that his petition was within two years of the Michigan property's sale, but that is not the operative date. Rather, a § 2-1401 petition "must be filed not later than 2 years after the entry of the *** judgment" (emphasis added) (735 ILCS 5/2-1401(c))- or in this case, the MSA-and we know of no authority finding fraudulent concealment of a settlement from one of the parties to that settlement.
¶ 18 Furthermore, we note that it is completely incongruous to claim both a mutual mistake of fact and fraudulent concealment. We understand Daniel's point that the issues with the distribution of the Michigan property's proceeds only came into focus for him once the Michigan property had sold, but that event was reasonably foreseeable at the time the dissolution judgment was entered. Like the trial court, we are hard-pressed to say that Daniel demonstrated due diligence in raising any alleged mistake in the MSA, let alone that Stacey had fraudulently concealed the issue from him. Accordingly, Daniel failed to adequately plead any exception that would excuse his overdue § 2-1401 petition.
¶ 19 The case Daniel relies upon most heavily, In re Marriage of Johnson, 237 Ill.App.3d 381 (1992), is ill-fitting here. True enough, Johnson provides a good example of a mutual mistake of fact in a post-dissolution context. There, the MSA contained a typographical error stating that the former wife would retain possession of the marital residence, but that the residence would be sold upon the husband's remarriage. Id. at 384-85. When the husband remarried and sought to force a sale of the marital residence, the former wife filed a § 2-1401 petition seeking to reform the settlement agreement, as the parties had originally agreed that her remarriage would trigger the sale of the marital residence, and not the remarriage of the former husband. Id. All of that, however, is beside the point. Critically, in Johnson, the former wife brought her § 2-1401 within two years, or 22 months, after the entry of the judgment. Id. at 383-84. That did not happen here as Daniel's petition plainly conceded.
¶ 20 Nothing we have said should be construed as implying that the MSA in this case was unambiguous or that Daniel has no grounds for relief. Rather, we confine ourselves to the threshold issue of whether the judgment should be collaterally reopened in the first place, and, like the trial court, we readily conclude that Daniel has failed to plead a basis that would permit the court to reopen the judgment via a § 2-1401 petition after the expiration of the limitations period. Even if we agree with Daniel's point that the MSA was ambiguous, "we cannot, by judicial fiat, extend the limitations period prescribed by the legislature for collaterally attacking final judgments." (Emphasis added.) City of Rockford v. Gilles, 2022 IL App (2d) 210521, ¶ 72. That said, because the trial court did not specify under which ground it dismissed the petition, we modify the judgment to reflect that it was dismissed as time barred under § 2-619, and vacate the dismissal under § 2615. Doing so clarifies that Daniel's collateral § 2-1401 petition was dismissed with prejudice, but that does not bar him from seeking further relief directly if he so chooses. See Rehfield v. Diocese of Joliet, 2021 IL 125656, ¶ 20 ("A court should not dismiss a complaint pursuant to [§ 2-615] unless it is clearly apparent that no set of facts can be proved that would entitle the plaintiff to recovery").
¶ 21 III. CONCLUSION
¶ 22 For the reasons stated, we affirm the dismissal of Daniel's petition under § 2-619, vacate the dismissal under § 2-615, and remand this case for further proceedings consistent with this disposition.
¶ 23 Affirmed in part and vacated in part; cause remanded.