No Room to Modify…Does permanent maintenance mean forever?
Published in Chicago Lawyer Magazine, April/May 2024
By Daniel Stefani
In January, the Illinois 3rd District Appellate Court published an “absurd but legally correct” Rule 23 opinion that answered the question of whether a permanent maintenance agreement was modifiable upon the payor’s retirement.
In In re the Marriage of Januszewski, 2024 IL App (3d) 230184-U, a panel reversed and remanded the trial court’s order which stated the maintenance terms of the parties’ marital settlement agreement were modifiable. Specifically, approximately eight years following the parties’ divorce, the payor filed a motion to terminate his maintenance obligations based on his imminent retirement from full-time employment. The ex-wife responded by filing a complaint for declaratory judgment arguing the petitioner’s maintenance obligations were non-modifiable pursuant to the MSA. The trial court denied the ex-wife’s complaint for declaratory judgment but it certified the order for interlocutory appeal.
The relevant terms of the parties’ MSA provided the husband pay the wife for permanent maintenance, a fixed sum per month. The MSA further stated in Sec. 10.1 that the parties “agree that the Agreement shall not be changed, modified or altered by any order of Court after the date of the Agreement has been incorporated into a Judgment for Dissolution of Marriage, or after it has become effective by entry of any Judgment for Dissolution of Marriage”. Additionally, in the general terms Sec. 11.10, the MSA stated “no provision of the Agreement shall be amended or modified unless by agreement in writing.”
The ex-wife argued that Secs. 10.1 and 11.10 were applicable to the entire terms of the agreement and prohibited any terms from being modified including both the amount and duration of the permanent maintenance provision. The ex-husband pointed out that Sec. 4.1 of the MSA provided that as long as a husband was employed and had a duty to provide maintenance, that he maintain a life insurance policy. Section 4.1 also indicated the Court reserved jurisdiction on the issue in the event respondent lost his employment or insurance coverage. The ex-husband argued Sec. 4.1 indicated the parties intended he pay permanent maintenance only as long as he was employed. The appellate court rejected the ex-husband’s argument.
The ex-husband also argued that unless there was a reference in the maintenance section pursuant to Sec. 502(f) of the Illinois Marriage and Dissolution of Marriage Act (“the Act”), there was no intent that the maintenance would be non-modifiable. Specifically, Sec. 502(f) provides that “the parties may provide that maintenance is non-modifiable in amount, duration or both. If the parties do not provide that the maintenance is non-modifiable in amount, duration or both, then those terms are modifiable upon a substantial change of circumstances … The judgment may expressly preclude or limit the modification of other terms set forth in the judgment if the agreement so provides.” The appellate court rejected the ex-husband’s argument.
He asserted that if his obligations were nonmodifiable, then after he retired, he would have to pay his ex-wife maintenance from his pension and retirement accounts despite the fact she had received already half of these assets in the divorce. Therefore, ex-husband argued the ex-wife’s ability to recover both half the value of his retirement and then maintenance from his half of the same asset until his death rendered the agreement unconscionable. The appellate court rejected the ex-husband’s argument by stating first that both parties were represented by counsel and had adequate legal advice throughout the process of preparing the agreement. Secondly, the mere fact the agreement favored one party over the other did not alone render it unconscionable.
In a special concurrence, one justice stated specifically she believed the outcome that the permanent maintenance obligation is nonmodifiable “flies in the face of common sense” and stated that just because it was a poorly drafted MSA the petitioner would be required to make maintenance payments from his pension distribution. But where the respondent under the same agreement was already awarded one-half of that asset, while “legally correct,” was an “absurd” result.
The lesson here is clear. Whenever drafting an MSA with maintenance provisions, there should be a reference to Sec. 502(f) stating specifically whether either the duration and/or amount is intended to be modifiable and/or non-modifiable. Additionally, while there was no reference to this provision in the opinion, Sec. 510 of the Act allows for modifiability of maintenance awards. There should also be a reference to Sec. 510 of the Act if the maintenance is intended to be modifiable.
Dan Stefani is a principal at Katz & Stefani. The firm’s practice is limited to family law matters. His work on behalf of mainly high net-worth clients, as well as spouses of high net-worth individuals, involves valuations of closely held corporations, partnerships and other entities, detailed analysis of complex financial transactions, child custody and support issues as well as paternity and domestic violence.