New Amendments to Fee Statute
Published in Chicago Lawyer Magazine, May 2010
By Daniel R. Stefani
On August 18, 2009, Governor Quinn signed into law certain amendments to the Illinois Marriage and Dissolution of Marriage Act (“Act”) relating to payment of attorney fees and other litigation costs incurred during actions brought pursuant to the Act. There were primarily six important amendments to the Act.
The attorney fee statute was originally designed to allow the financially disadvantaged spouse to ask the court to order the other party to advance funds outside that party’s control for their attorney fees and other litigation costs in a summary proceeding. Any fee award was presumed an advance against the financially disadvantaged spouse’s share of the marital estate. At the conclusion of an action, the Act allowed for what is called a contribution hearing where the court could reallocate the responsibility for payment of fees. In theory, this created an efficient mechanism so that both spouses could afford adequate representation during the pendency of a case, without the need for an evidentiary hearing. In cases where there was not a marital estate, the Act presented problems and inequities in certain instances in deciding the issues in a summary proceeding.
The old Act provided for a presumption that all interim fee hearings in pre-decree, post-decree and parentage actions were presumed to be summary in nature. The new amendment provides that the presumption only applies to pre-decree dissolution proceedings. The purpose behind this new limitation is that in post-decree litigation and paternity actions, there is no marital estate from which to order an advance for attorney fees. As such, a full evidentiary hearing is now required in post-decree proceedings and paternity actions. While a full evidentiary hearing is now required in post-decree litigation and paternity actions, a summary proceeding is still allowable if the parties so stipulate.
The second amendment relates to the filing deadlines for a contribution hearing at the end of the case to reallocate responsibility for fees. Under the old Act, parties were required to file a petition for contribution within thirty days after proofs had closed but before judgment was entered. Under the new amendment, contribution petitions for attorney fees and litigation costs can be filed within thirty days after the date of entry of judgment in all proceedings brought pursuant to the Act.
Third, in situations where the parties waive their right to a contribution hearing and agree to each be responsible for their own fees, the old Act allowed for the attorney and/or the party to file a petition asking the court to make a finding of what amount is ultimately owed for fees. These hearings required the court to scrutinize the billing statements of the party’s attorney and make a finding of what fees were reasonable and necessary. The old Act required the attorney and the client to resolve any differences they had as it relates to the fees incurred and come to an understanding as to how the fees would be paid within thirty days of entry of judgment. If the parties were unable to reach an agreement, a petition needed to be filed or the divorce court lost jurisdiction over the fee dispute. Jurisdiction of the divorce court could be extended under the old Act for a period of sixty days by the filing of a praecipe. This strict deadline, in many instances, forced attorneys to prematurely file their petition for setting of final fees which created an adversarial situation with their former client. The new amendment now allows for the divorce court to retain jurisdiction for the filing of a petition for setting of final fees up to one year after a praecipe is filed. Additionally, the new amendment allows for the tolling of the deadline for filing a praecipe or a petition for setting of final fees if any post-judgment motions or a notice of appeal are filed.
Fourth, under the old Act, if the attorney and their client reach an agreement, a consent judgment was entered between the client and their attorney setting forth the terms and conditions of payment of the fees which was effectuated by the filing of a petition for entry of consent judgment. The old Act arguably required an attorney to physically attach their billing statements to such petition for entry of consent judgment; although, in many instances, courts have allowed incorporation by reference. The new amendment resolves any ambiguities in that regard by specifically stating that counsel must simply include a supporting affidavit stating that the billing statements have been previously provided to the client.
Fifth, the new amendment clarified that Section 508(b) of the Act is applicable to all hearings under the Act, and not just hearings pursuant to the fee statute.
The last major change to the fee statute relates to historic claims that advances of attorney fees from the estate constitute dissipation. Dissipation is defined as the payment of marital funds for purpose unrelated to the marriage after an irretrievable breakdown of that marriage. Illinois case law interpreted that definition to include the payment of attorney fees and other litigation costs. The new amendment softens the common law notion that all attorney fees should be considered dissipation but still allows for a claim of dissipation if the court finds the litigation was excessive and/or improper under the circumstances.