In re Marriage of Jennings

Overview

In In re Marriage of Jennings , 2026 IL App (5th) 250188-U, the Fifth District affirmed the circuit court's classification of real estate held by the husband's holding company as marital property because he could not trace the purchase funds to nonmarital sources, but reversed and remanded because the trial court never classified the wife's retirement/investment account. Because the property division may change on remand, the court declined to reach the husband's challenges to the asset division and permanent maintenance award.

Key Facts

Husband formed JENCO of IL Inc. in 1997 (pre-marriage) to operate Subway franchises; the parties married July 14, 1999.

JENCO purchased the Johnston City property in December 2001; Husband formed AJEM, Inc. in September 2002 to hold the real estate; JENCO sold the Johnston City property to AJEM in October 2002.

AJEM purchased the Herrin property in 2004; Husband personally purchased West Frankfort property in 2012; JENCO paid AJEM $102,900 in 2021 to fund construction of the West Frankfort store.

The parties stipulated that JENCO was nonmarital ; the court so found.

Husband admitted he could produce no documentation tracing the funds used to acquire the real properties, though he denied marital assets were used. He also could not trace what assets JENCO held as of the marriage date.

The parties stipulated Wife had a retirement account valued at approximately $42,700, disclosed in her financial affidavit.

Wife was a stay-at-home mother, unemployed, living with and caring for her mother in Florida, with roughly $2,200 in uncovered monthly expenses and about $10,000 in unpaid attorney fees.

The judgment awarded Wife the marital residence (subject to Husband's $300,000 buyout option), 40% of AJEM's appraised real estate value, $100,000 for half of Husband's investment accounts, $2,200/month permanent maintenance, and $5,000 in fees (plus $2,000 previously ordered).

Procedural History

Wife filed for dissolution January 26, 2022, in the Circuit Court of Williamson County (No. 22-DC-13, Judge John W. Sanders). Interim fees were granted by agreed temporary order July 1, 2022. Following discovery, hearing was held October 16, 2024; written closings were filed December 2, 2024. The court issued a nonfinal order with findings January 13, 2025, and entered the judgment of dissolution February 10, 2025. Husband substituted counsel and filed a timely notice of appeal March 10, 2025. Wife filed no appellee brief; the court proceeded under First Capitol Mortgage Corp. v. Talandis Construction Corp. , 63 Ill. 2d 128 (1976).

Holdings

Affirmed in part: The finding that real property acquired after the marriage — including property transferred between JENCO and AJEM — was marital was not against the manifest weight of the evidence , because Husband failed to prove by clear and convincing evidence that the purchase funds were nonmarital. Property retained its marital character when transferred between the entities.

Reversed in part and remanded: The circuit court failed to make any classification finding as to Wife's stipulated $42,700 account, as required by section 503 of the Act.

The court declined to decide the marital-estate division and permanent maintenance issues because remand may alter both. See Goral v. Dart , 2020 IL 125085, ¶ 76.

Legal Principles

750 ILCS 5/503(b): rebuttable presumption that all property acquired after the marriage and before judgment is marital, regardless of how title is held .

The presumption is overcome only by clear and convincing evidence of a section 503(a) exception; the party claiming nonmarital status bears the burden, and doubts are resolved in favor of marital classification. In re Marriage of Didier , 318 Ill. App. 3d 253, 258 (2000).

Property must be classified before it can be divided. Didier , 318 Ill. App. 3d at 258.

Classification is reviewed for manifest weight of the evidence. In re Marriage of Veile , 2015 IL App (5th) 130499, ¶ 12.

750 ILCS 5/504(a)(1): the property division bears on the maintenance determination.

Talandis : no automatic reversal for a missing appellee brief; the court will not act as appellee's advocate or search the record to sustain the judgment.

Practical Implications

Stipulating that a business entity is nonmarital does not insulate its post-marital acquisitions. Counsel must separately trace the funds used for each acquisition and establish the entity's asset composition as of the marriage date.

Build the tracing record with documents — bank records, corporate ledgers, closing statements, tax returns. Testimonial denial that "marital assets were used," even corroborated by a CPA, is insufficient.

Inter-company transfers do not launder marital character; property transferred between related entities retains its classification.

Confirm the judgment classifies every disclosed asset — including the opposing party's accounts. An omitted classification is reversible error and a viable appellate issue.

Where classification error requires remand, expect the reviewing court to defer ruling on division and maintenance; frame appellate arguments accordingly.

Distinguishing factor: this outcome turned on an evidentiary failure, not a legal rule — a party with adequate tracing documentation should reach the opposite result.

Limitations/Caveats

This is a Rule 23(b) order and is not precedential except in the limited circumstances of Rule 23(e)(1); cite it only for those purposes. The opinion also notes it may be changed or corrected before rehearing disposition. The binding dispositions are the affirmance on tracing and the reversal for failure to classify Wife's account; the observations that the division of assets and the maintenance award "may change on remand" are explanatory and do not decide those issues, which remain open. Parenting and support issues were mooted by the child's majority and were not addressed.