In re Marriage of Notestine, 2019 IL App (5th) 170332-U

- Case citation and parties
In re Marriage of Notestine, 2019 IL App (5th) 170332‑U. Petitioner‑Appellant: Carol R. Notestine (now Thompson) (Wife). Respondent‑Appellee: Patrick A. Notestine (Husband).

- Key legal issues
- Whether post‑dissolution federal/state tax refunds (from amended joint returns covering 2007, 2009, 2010) are subject to division under the parties’ marital settlement agreement.
- How to interpret the tax‑related provision in the settlement agreement (temporal scope: limited to “year 2010”?) and whether contract language or equitable considerations control when one spouse paid audit‑imposed tax liabilities.
- Application of contract‑construction principles to marital settlement provisions.

- Holding / outcome
The appellate court reversed the trial court’s denial of Wife’s motion to enforce the settlement agreement as to tax year 2010 and remanded for entry of judgment awarding Wife $21,979 (one half of the $43,958 2010 refund). The court did not extend division to the refunds attributable to other years.

- Significant legal reasoning (concise)
- Marital settlement agreements are interpreted as contracts; interpretation is a question of law reviewed de novo. The primary objective is to effectuate the parties’ intent from the agreement’s language.
- Paragraph Q of the settlement agreement expressly addressed taxes “for the year 2010,” requiring Husband to pay taxes and directing that any refund “be split on an even basis.” That clear temporal language limited the refund‑split obligation to 2010.
- The general rule (In re Marriage of Ormiston) that tax refunds for income earned during marriage are marital property may be contracted around; parties may allocate tax consequences by agreement.
- The trial court’s equitable rationale (Husband paid net additional tax after audits and refunds and therefore should keep the refund) could not override an unambiguous contractual allocation limited to 2010; Husband conceded Wife was entitled to half of the 2010 refund.

- Practice implications for family attorneys
- Draft explicit tax provisions: specify years covered, allocation of refunds/liabilities, post‑decree audit procedures, setoff mechanics, indemnity/hold harmless, escrow or contingency funds, and tax preparer/representation authority.
- For divorces involving S‑corporations or pass‑through entities, anticipate audits and recastings; address who bears risk of audit adjustments and how refunds/assessments are reconciled.
- Clear language controls; courts will enforce unambiguous contractual terms even if the result seems inequitable post‑audit.