In re Marriage of Plancon

2023 IL App (1st) 220510-U
CourtAppellate Court of Illinois
DecidedDecember 29, 2023
Docket1-22-0510
StatusUnpublished
Cited by1 cases

This text of 2023 IL App (1st) 220510-U (In re Marriage of Plancon) is published on Counsel Stack Legal Research, covering Appellate Court of Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
In re Marriage of Plancon, 2023 IL App (1st) 220510-U (Ill. Ct. App. 2023).

Opinion

2023 IL App (1st) 220510-U

SECOND DIVISION December 29, 2023

No. 1-22-0510

NOTICE: This order was filed under Supreme Court Rule 23 and is not precedent except in the limited circumstances allowed under Rule 23(e)(1). ______________________________________________________________________________

IN THE APPELLATE COURT OF ILLINOIS FIRST JUDICIAL DISTRICT ______________________________________________________________________________

In re MARRIAGE OF: ) ) Appeal from the AMANDA PLANCON, ) Circuit Court of ) Cook County Petitioner-Appellant, ) ) 17 D 1289 and ) ) Honorable MICHAEL PLANCON, ) Rosa M. Silva, ) Judge Presiding Respondent-Appellee. ) _____________________________________________________________________________

JUSTICE ELLIS delivered the judgment of the court. Justices McBride and Cobbs concurred in the judgment.

ORDER

¶1 Held: Reversed. Respondent did not carry burden of establishing that value of retirement benefits awarded to petitioner ex-spouse was newly discovered evidence warranting relief under section 2-1401.

¶2 Amanda and Michael Plancon settled their divorce and, in doing so, agreed that Amanda

would receive 100% of Michael’s employee retirement fund, operated by Fidelity, the present

value of which they estimated at roughly $300,000. They entered into a qualified domestic

relations order (QDRO) to reflect that transfer. Once that occurred, Amanda attempted to “cash

out” those retirement benefits, opting for a lump-sum payment rather than a retirement annuity; No. 1-22-0510

she decided that her need for immediate cash was more important to her than a pension upon

retirement. The cash-out value under this benefit plan, Fidelity told her, was closer to $440,000.

¶3 When he learned of this cash-out value, Michael sought a reformation of the marital

settlement agreement under section 2-1401 of the Code of Civil Procedure. See 735 ILCS 5/2-

1401 (West 2020). Michael argued mutual mistake—that he did not realize that the retirement

benefits that he had held for 15 years were worth $440,000 upon immediate cash-out. The circuit

court agreed that a mutual mistake of fact occurred, opining that the parties initially believed that

Amanda was receiving about $300,000, but that “[l]ater on, it came out that it was $440,000 in

the span of *** five or six months, and that would be a windfall for [Amanda].”

¶4 We reverse the court’s judgment. Michael did not demonstrate that any newly discovered

evidence occurred here to justify his collateral attack on the marital settlement agreement. The

record shows that Michael was aware, before even the initiation of the divorce, that his

retirement benefit could be monetized in any number of ways, including retaining it as a

retirement pension or withdrawing the proceeds as a lump-sum cash-out in lieu of a retirement

pension. And if that fact had escaped him by the time the divorce was settled, as he claims, it

remains that he should have known. The fact that Amanda, once in possession of that asset,

opted to receive a lump-sum cash-out in lieu of a future pension was her choice to make, and

Michael did not demonstrate that he was unaware that she had that option; to the contrary, the

evidence showed that he knew or, at a bare minimum, should have known.

¶5 BACKGROUND

¶6 After a 17-year marriage, Amanda filed for divorce in 2017. In June 2019, the parties

entered into a marital settlement agreement (MSA). The MSA concerned many provisions,

-2- No. 1-22-0510

including many regarding the care, custody, and support of their three minor children (one of

whom later became emancipated). But relevant here, the MSA divided up marital assets.

¶7 Amanda was given the residential home, where she would remain living with their three

children. Amanda would be responsible for the mortgage payments as well as the home-equity

line of credit (HELOC) payments and both parties’ attorney fees. The MSA contemplated a

possible sale of the residential home and included several provisions regarding that sale.

¶8 Paragraph 8.7(a) of the MSA provided that “[t]he parties shall divide their retirement

accounts so that Michael receives $330,000 of retirement funds and Amanda receives the

remaining amount.” The parties thus divided up the retirement accounts as described below.

¶9 Michael, who was gainfully employed and had previously worked for 15 years for BP

Amoco (BP), was allocated (1) all of his “NYL/Mainstay” IRA, valued at roughly $95,000; (2)

all of his “ADP/Coats” 401K ($8,000); (3) all of his Roth IRA ($600); and (4) the sum of

$226,115 from his “Fidelity BP 401K” that was valued at about $292,000, with the remainder

going to Amanda. Those amounts added up to the $330,000 of retirement funds promised in

paragraph 8.7(a).

¶ 10 In addition to receiving the remainder of Michael’s BP 401(k) as described immediately

above, Amanda received “100% of Michael’s BP Retirement Accumulation Plan.” This BP

Retirement Accumulation Plan, or “BP RAP,” is the subject of this litigation and bears extended

discussion.

¶ 11 The MSA stated that the BP RAP had “a balance of $301,082 as of June 19, 2019.” That

number was taken from the most recent monthly statement sent to Michael, as the sole

participant of the BP RAP. Like the BP 401(k), the BP RAP was to be transferred by a qualified

domestic relations order (QDRO). From the proceeds, Amanda was required to pay $85,000 in

-3- No. 1-22-0510

attorney fees to Michael’s lawyers and $50,000 to Amanda’s. The remainder of the fund went to

Amanda. She could liquidate the account or she could roll the money over into another tax-

deferred retirement plan like an IRA. If she chose to liquidate the account—that is, take the

money immediately—Amanda would be solely responsible for the income-tax implications of

doing so: “Amanda shall be solely responsible for any taxes or penalties incurred resulting from

the early liquidation of retirement funds from this account.”

¶ 12 In August 2019, the court entered the QDRO to effectuate the transfer of Michael’s

Fidelity BP RAP to Amanda. The QDRO correctly identified Michael as the original plan

“participant” and Amanda as the “alternate payee.” The QDRO noted, as well, that Amanda

might withdraw the money as an early-retirement subsidy, as opposed to rolling it over into

another retirement vehicle: “[t]he Alternate Payee is awarded a proportionate share of the

Participant’s early retirement subsidy, if any, when the Participant commences receipt of the

accrued vested benefit in the Plan. Such proportionate share shall be calculated in the same

manner as the Alternate Payee’s share of the Participant’s accrued vested benefit is calculated

pursuant to this Order.”

¶ 13 In October 2019, Fidelity wrote Amanda a letter indicating that it approved the QDRO as

“qualified” under ERISA and the IRS Code as appropriate. The Plan also informed Amanda, the

“Alternate Payee,” that,

“As of 12/1/2019, the total estimated value of the benefit you are eligible to receive as a

one-time lump sum payment is $440,124.35. If you choose not to take your benefit as a

lump-sum payment, you may receive this estimated benefit amount as any one of the

payment options listed below. Description of your payment options follow.

Payment Option Amount Partial Lump Sum $220,062.18

-4- No. 1-22-0510

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Bluebook (online)
2023 IL App (1st) 220510-U, Counsel Stack Legal Research, https://law.counselstack.com/opinion/in-re-marriage-of-plancon-illappct-2023.