In re Marriage of Hyman, 2023 IL App (2d) 220041

- Case citation and parties
In re Marriage of Hyman, 2023 IL App (2d) 220041. Petitioner-Appellant: Jeffrey R. Hyman; Respondent-Appellee: Rachel D. Hyman.

- Key legal issues
1) Whether stock options issued to husband during the marriage but held in his individual name were “disclosed” or otherwise excluded from the Marital Settlement Agreement (MSA) allocation scheme.
2) Whether the MSA’s undisclosed-asset provision permitted equal division of those options after dissolution where wife did not pursue further discovery before settlement.
3) Proper characterization (marital vs. separate) of vested and unvested options and the remedy for nondisclosure.

- Holding / outcome
The Second District affirmed the trial court. All 500 stock options awarded to Jeffrey during the marriage were marital assets subject to the MSA’s undisclosed-asset provision and 50% were awarded to Rachel. The trial court’s allocation (Rachel’s 50% valued at $246,597; payment to Rachel of $130,196 after taxes/expenses) was affirmed.

- Significant legal reasoning
- The appellate court treated the MSA as a contract (interpretation de novo) and reviewed factual findings for manifest-weight review.
- The court rejected husband’s argument that the options were Strong Suit LLC’s nominal assets, concluding the option grants and agreements named Jeffrey individually (not Strong Suit), so the assets were his.
- Husband repeatedly failed to disclose the existence of the options despite interrogatories, a court-ordered reporting obligation, and express MSA representations that he had “fully disclosed all of [his] assets.” His testimony at prove-up that he had disclosed all assets bolstered the trial court’s finding.
- The court found no requirement to demonstrate bad faith; nondisclosure in the face of express representations and discovery duties triggered the undisclosed-asset clause and equal division, irrespective of whether some options were unvested at judgment.

- Practice implications (concise)
- Counsel must aggressively pursue discovery pre-settlement; failure to do so does not prevent later relief where the other spouse knowingly failed to disclose assets.
- Draft MSAs to define “assets” (including contingent/unvested interests), specify valuation date(s), allocate tax consequences, and state remedies for nondisclosure.
- When clients hold or receive equity/option grants, confirm whether grants were made to the individual or an entity, and require full documentary disclosure (grant notices, option agreements, vesting schedules).
- Advise clients that holding assets in a personal name to “avoid disclosure/tax issues” may not insulate them from being characterized as marital property.
- Preserve prove-up record of disclosure representations and consider express carve-outs or escrow mechanisms for contingent postjudgment assets.