text:
    PAINE, WEBBER, JACKSON & CURTIS, INC., Plaintiff-Appellee, v. ERIC H. RONGREN, Defendant-Appellant.
    First District (4th Division)
    No. 83—2361
    Opinion filed August 23, 1984.

      Eric H. Rongren, of Glen Ellyn, for appellant, pro se.

    Cantwell, Smith & Van Daele, of Chicago (Peter A. Cantwell and Andrew V. DePaul, of counsel), for appellee.
   PRESIDING JUSTICE LINN

delivered the opinion of the court:

Defendant investor appeals from the trial court’s entry of a foreign judgment in the amount of $1,790.63, plus interest and costs, in favor of plaintiff investment firm based on an award by the arbitration board of the New York Stock Exchange arising from defendant’s breach of a margin contract. The claim was arbitrated pursuant to a predispute arbitration provision in the customer’s agreement.

On appeal, defendant alleges he was denied due process and that the New York court lacked personal jurisdiction over him and subject matter jurisdiction over the claim, which he asserts arises under the Federal securities laws.

We affirm the decision of the trial court.

Facts

In 1972, defendant investor, Eric Rongren, entered into a customer’s agreement with plaintiff investment firm, Paine, Webber, Jackson & Curtis, Inc. (Paine Webber), for the opening of a securities trading account. The margin contract contained a predispute arbitration provision which provided, under paragraph 14, that:

“Any controversy between us arising out of, or relating to this contract or the breach thereof, shall be settled by arbitration, in accordance with the rules, then obtaining, of either the American Arbitration Association, or the New York Stock Exchange, as I may elect. I authorize you, if I do not make such election by registered mail addressed to you at your main office within fifteen (15) days after receipt of notification from you requesting such election, to make such election in my behalf. Any arbitration hereunder shall be before at least three (3) arbitrators or a majority of them, shall be final, and judgment upon the award rendered may be entered in any court, state or federal, having jurisdiction.”

In December 1978, defendant placed an order with plaintiff’s broker agent, to sell short a security. Defendant later claimed he was induced to effect this sale by plaintiff’s broker having misrepresented certain investment stop figures that appeared in plaintiff’s published advisory letter. Defendant informed plaintiff in a letter sent to the operations manager at Paine Webber that no sale order would have been “solicited successfully had the correct information been supplied.” In consequence of this transaction, a dispute arose between the parties, and in a letter dated March 27, 1979, plaintiff notified defendant that it sought arbitration of the dispute pursuant to paragraph 14 of the customer’s agreement. Plaintiff explained its request for arbitration as follows:

“Your statement that our Chicago office willfully violated Illinois law is the matter of dispute here and the reason for my request for arbitration to resolve this matter.”

Defendant failed to elect a forum, and, pursuant to paragraph 14 of the customer’s agreement, plaintiff initiated arbitration proceedings before the arbitration board of the New York Stock Exchange. Defendant did not participate in the arbitration nor did he at any time apply for a stay of arbitration in accordance with the appropriate provisions of the New York Arbitration Act.

In January 1980, plaintiff won an arbitration award in the sum of $1,790.63. Defendant did not move to vacate the award, and thereafter plaintiff applied to the New York Supreme Court for an order confirming the award of the arbitrators. In its order dated August 8, 1980, the New York Supreme Court, noting proof of due service and defendant’s failure to answer or appear in opposition thereto, confirmed the arbitration award and ordered judgment in favor of plaintiff for the sum of $1,882.33, the sum of the award plus interest and costs.

On July 9, 1981, Paine Webber filed a petition for registration of foreign judgment (Ill. Rev. Stat. 1981, ch. 110, par. 12—602) in the circuit court of Cook County, Illinois. A certified copy of the petition together with a summons was served on defendant. Defendant filed an appearance, answer, and jury demand in the Cook County proceedings in August 1981. In his answer, defendant stated that he had made protest to Paine Webber concerning the “misrepresentations made by broker” that induced him to enter the December 18, 1978, short sale order. Defendant raised as his defense the Illinois Statute of Frauds (Ill. Rev. Stat. 1981, ch. 26, par. 8—319), claiming that the “contract was not enforceable” due to lack of a written confirmation of sale. At a hearing held in October 1981, defendant’s jury demand was denied.

Thereafter, pursuant to sections 12—606 and 12—607 of the Illinois Code of Civil Procedure (Ill. Rev. Stat. 1981, ch. 110, pars. 12—606, 12—607), a levy was made on defendant’s residence for satisfaction of the judgment, and plaintiff arranged for a sheriff’s sale of defendant’s home. Prior to the date fixed for the sale, defendant moved to stay execution. A hearing was held on his motion in July 1983, before the Honorable Alfred Teton. At this hearing, defendant raised two issues. He protested that no hearing had been held on his opposition to the registration of the foreign judgment. He also asserted that the New York court did not have jurisdiction to confirm the arbitration award. The trial court, finding that a proper hearing on the petition and defendant’s opposition thereto had not been held, granted defendant’s motion for a stay of the sale, granted defendant leave to file an amended answer to the petition to register the foreign judgment, and set the matter for hearing.

Hearings were held on August 23 and September 19, 1984. The reports of these proceedings were not made part of the record on appeal. Based on these hearings, the trial court entered an order finding that (1) defendant had failed to introduce any evidence that would indicate that the arbitration clause contained within the customer agreement was void, and (2) defendant had failed to present any evidence indicating that the New York judgment confirming the arbitration award was void for lack of personal or subject matter jurisdiction. So finding, the trial court ordered that the judgment entered by the New York Supreme Court be confirmed and entered it as a final judgment in favor of plaintiff. It is from this order defendant now appeals.

Opinion

This appeal is from the trial court’s order granting plaintiff’s petition to register a foreign judgment pursuant to the Uniform Enforcement of Foreign Judgments Act. (Ill. Rev. Stat. 1981, ch. 110, pars. 12—601 through 12—617.) The purpose of the Act is to implement the full faith and credit clause of the Federal Constitution and to facilitate interstate enforcement of judgments in any jurisdiction where the party against whom a foreign judgment has been rendered is found. (Ayers Asphalt Paving, Inc. v. Allen Rose Cement & Construction Co. (1982), 109 Ill. App. 3d 520, 440 N.E.2d 907.) A foreign judgment is not subject to collateral attack in an Illinois court except for the defense of fraud in the procurement of the judgment or lack of jurisdiction in the rendering court. Thompson v. Safeway Enterprises, Inc. (1978), 67 Ill. App. 3d 914, 385 N.E.2d 702.

Defendant collaterally attacks the New York judgment on the grounds that the New York Supreme Court lacked personal jurisdiction over him and subject matter jurisdiction over the claim. Defendant also directly attacks the judgment of the trial court, claiming that he was denied due process by not being allowed the opportunity to present certain material facts from the arbitration proceedings file at trial. All of the issues raised by defendant on appeal are therefore issues of fact.

We note initially that defendant has failed to include in the record on appeal a report of the proceedings of the hearings held on August 23, 1983, and September 19, 1983, those hearings pursuant to which the trial court issued the order from which defendant now appeals. The only report of proceedings included in the record on appeal is that of the hearing held before Judge Teton on July 18, 1983. The record shows that the July 18, 1983, hearing dealt with defendant’s motion to stay the sale of his home and not with the merits of plaintiff’s petition to register the foreign judgment. Judge Teton clearly stated in his memorandum opinion dated July 21, 1983, following the July 18, 1983, hearing, that:

“It is my view that no hearing having been held, to set aside the registration of the foreign judgment on the basis of the Defendant’s motions would be to deny Plaintiff its day in Court. Both parties are entitled to, and should have, an appropriate hearing.
It is therefore ordered that the registered judgment has not become a final judgment; that a hearing on the opposition to the registration shall be held; that the levy under the registered judgment shall remain in force; that no sale shall be made under that levy unless and until a final judgment is entered.”

The findings of this memorandum opinion were formalized in an order entered July 22, 1983, in which defendant was granted leave to amend his response to plaintiffs petition to register the New York judgment.

Thereafter, on July 26, 1983, defendant filed an amended answer to plaintiffs’ petition to register a foreign judgment pursuant to the order issued by Judge Teton. Hearings on plaintiffs’ petition and defendant’s opposition thereto were subsequently held, pursuant to which a final order was entered by Judge Teton on September 19, 1983. It is the evidence presented at these hearings of which the record is completely devoid.

In the absence of a report of the proceedings, the issues raised for which evidence at trial would be necessary to the determination of the appellate court are not subject to review. (Abbey Plumbing & Heating, Inc. v. Brown (1977), 47 Ill. App. 3d 719, 365 N.E.2d 115.) The burden is on the appellant to present a complete record on appeal, and any doubt arising from the incompleteness of the record in its presentation of facts will be resolved against the appellant; however, failure to present a report of proceedings does not require automatic dismissal or affirmance where issues can be resolved on the record as it stands. Venturini v. Affatato (1980), 84 Ill. App. 3d 547, 405 N.E.2d 1093.

In addition to this burden of proof and the automatic factual resolution against him stemming from the incompleteness of the record, defendant here must rebut a strong legal presumption that underlies questioning the jurisdiction of the New York Supreme Court. For, where a judgment has been rendered by a court of general jurisdiction, there is a strong legal presumption that the court had jurisdiction to render the judgment and that its proceedings conformed to the law of the rendering State. (Evans v. Advance Schools, Inc. (1979), 70 Ill. App. 3d 947, 388 N.E.2d 1003.) Where, as here, the foreign decree is silent as to its jurisdiction over the defendant, this legal presumption attaches, and defendant, by certain and positive averments, must negate every fact from which jurisdiction of the rendering court could arise. Evans v. Advance Schools, Inc. (1979), 70 Ill. App. 3d 947, 388 N.E.2d 1003.

We must therefore determine whether, by submission of this incomplete record, defendant has presented enough facts on each of the issues raised to render them subject to review by this court; and, if not, whether absent a proper record, the judgment appealed from must be affirmed.

Defendant’s first contention is that the New York Supreme Court lacked jurisdiction over his person. Defendant bases this contention on the theory of “minimum contacts.” (International Shoe Co. v. State of Washington (1945), 326 U.S. 310, 90 L. Ed. 95, 66 S. Ct. 154.) Defendant argués that the execution of a customer’s agreement in which he agreed to elect arbitration either before the American Arbitration Association or the arbitration committee of the New York Stock Exchange conferred no privilege upon him such as to satisfy the minimum contacts doctrine. Plaintiff, on the other hand, citing Merrill Lynch, Pierce, Fenner & Smith, Inc. v. Lecopulos (2d Cir. 1977), 553 F.2d 842, asserts that the execution of the customer’s agreement satisfied the due process requirement of engaging in purposeful activity within the forum and conferred personal jurisdiction over defendant.

A copy of the customer’s agreement has been made part of the record on appeal, thereby providing us with a sufficient factual basis upon which to decide the issue of personal jurisdiction. In light of the plain language in the agreement, and the undisputed fact that defendant signed said agreement, defendant’s consent to arbitrate in New York is a consent to the personal jurisdiction of the courts in New York. (Intermeat, Inc. v. American Poultry, Inc. (2d Cir. 1978), 575 F.2d 1017.) While it is arguable that defendant had the option to elect the American Arbitration Association rather than the New York Stock Exchange committee, he failed to exercise that option, and the election was properly made by plaintiff. By not exercising his right to elect, defendant impliedly consented to plaintiff’s election and, correspondingly, to the New York court’s jurisdiction over his person. (Bania v. Royal Lahaina Hotel (1975), 37 Ill. App. 3d 661, 347 N.E.2d 106.) We therefore find that the New York Supreme Court had personal jurisdiction over defendant.

Defendant’s next contention is that the New York Supreme Court lacked subject matter jurisdiction because the claim arose under the Federal securities laws and was therefore, under the holding of Wilko v. Swan (1953), 346 U.S. 427, 98 L. Ed. 168, 74 S. Ct. 182, not subject to arbitration. Plaintiff concedes that arbitration clauses contained in brokerage agreements are not enforceable with regard to claims arising under the Federal securities laws. Plaintiff asserts, however, that the judgment that he here seeks to enforce arose not under the Federal securities laws but from the arbitration of a State law contract claim and that under the authority of Baselski v. Paine, Webber, Jackson & Curtis, Inc. (N.D. Ill. 1981), 514 F. Supp. 535, such claims are properly arbitrable.

We must therefore decide whether the instant case is governed by Wilko v. Swan (1953), 346 U.S. 427, 98 L. Ed. 168, 74 S. Ct. 182, in which the Supreme Court held that predispute agreements to arbitrate claims arising under the Securities Act were void, or by Baselski, in which the Northern District of Illinois upheld a predispute arbitration provision in a customer’s agreement, almost identical to the instant provision, where the claims arose out of a State law and the parties had agreed that their contractual relationship would be governed by the law of New York.

The distinction to be made is a factual one. After a careful and complete review of the record before us, we necessarily find that the record on appeal is insufficient to enable us to make this distinction. The only evidence we have culled from the record which might generously be construed as factual is as follows:

Defendant, in his answer, states that misrepresentations were made to him by his broker to induce him to enter into an order for a security transaction and that the contract was not enforceable under the Illinois Statute of Frauds. (Ill. Rev. Stat. 1981, ch. 26, par. 8—319.) In his amended answer, defendant states that the dispute grew out of the December 18, 1978, transaction which occurred when:

“*** defendant received false and incomplete information from plaintiff’s Chicago office on the purported investment limit price for a short sale of a security. * * * Defendant states that elements of fraud were involved in the transaction on December 18, 1978; that at the same time that defendant was induced to enter this short sale, plaintiff’s New York office was readying its buy recommendation on the same security which became public three days later.”

In a letter from defendant to the operations manager at Paine Webber, defendant states that the December 18 short sale order was “obtained through misrepresenting the investment stop figures for Datapoint appearing in the Peroni Opinion report dated December 14.” And, finally, in the report of the proceedings from the July 18, 1983, hearing on defendant’s motion to stay the sale of his home, defendant states “that the facts show that that claim was obtained through misrepresenting.”

These sparse and scattered excerpts from the record most closely approach the status of “facts,” and yet, in all fairness to plaintiff, these statements more closely resemble accusations or bare allegations than they do statements of fact. The “statement of facts” contained in defendant’s appellate brief also fails to provide us with the information needed for a determination for, without adequate support in the record, the “statement of facts” lies outside the record and may not be considered on appeal. (Abbey Plumbing & Heating, Inc. v. Brown (1977), 47 Ill. App. 3d 719, 365 N.E.2d 115.) We are, therefore, required to assume that the evidence presented at trial was sufficient to support the judgment (Belcher v. Spillman (1975), 28 Ill. App. 3d 973, 329 N.E.2d 550), and that the court rendered the judgment upon a State law rather than a Federal securities law claim.

Defendant has therefore failed to rebut the presumption of the jurisdiction of the court rendering the foreign judgment. In addition, there is another presumption operating here. It is presumed that the arbitrator did not exceed his authority. (American Invsco Realty, Inc. v. Century 21 (1981), 96 Ill. App. 3d 56, 420 N.E.2d 692.) All reasonable presumptions are indulged in favor of the arbitration award (Wilcox Co. v. Bouramas (1979), 73 Ill. App. 3d 1046, 392 N.E.2d 198), and a court must construe an arbitration award, whenever possible, to uphold its validity. Board of Education v. Chicago Teachers Union, Local No. 1 (1981), 86 Ill. 2d 469, 427 N.E.2d 1199.

The New York Supreme Court could not have properly exercised jurisdiction to confirm the arbitration award nor could the arbitrator have acted within the scope of its authority had those bodies not construed the claim upon which the award was made as arising out of State law. Defendant never made a special appearance to protest jurisdiction, nor moved to stay the arbitration proceedings, nor moved to vacate the arbitration award by asserting a claim arising under the Federal securities laws. Defendant has, in fact, never asserted any claim; he has only defended against the claim brought by plaintiff for breach of the margin agreement.

Plaintiff asserts that its claim arises from defendant’s failure to meet Regulation T requirements covering the short sale of certain securities. Such claims for breach of a margin contract and violations of Regulation T, dealing with margin requirements and withdrawal of funds from a margin account, are properly arbitrable. (Macchiavelli v. Shearson, Hammill & Co. (E.D. Cal. 1974), 384 F. Supp. 21.) So, too, are claims of breach of fiduciary duty and the tort of misrepresentation. (Baselski v. Paine, Webber, Jackson & Curtis, Inc. (N.D. Ill. 1981), 514 F. Supp. 535.) The arbitration board, the New York Supreme Court, and the circuit court of Cook County must necessarily have found that the instant action arose from one of these properly arbitrable State law claims. We will not reverse their findings on the speculation and conjecture to which we are limited by an incomplete record. Teitelbaum v. Reliable Welding Co. (1982), 106 Ill. App. 3d 651, 435 N.E.2d 852.

Defendant’s final contention on appeal is that he was denied due process because (1) the summons served upon him was not accompanied by a complaint and (2) certain documents were not offered into evidence by plaintiffs. As pointed out by plaintiffs, the record discloses that defendant was properly served with a summons and a copy of the petition for registration of the foreign judgment. This is proper under the Uniform Enforcement of Foreign Judgments Act. (Ill. Rev. Stat. 1981, ch. 110, par. 12—604.) There was no complaint in the instant action which was based on plaintiffs’ petition for registration. The petition requesting the court to register the foreign judgment specifically sets forth all facts and circumstances necessary to afford defendant due process.

Finally, defendant claims that plaintiffs violated Supreme Court Rule 282 by not attaching a number of documents to the summons and petition. (73 Ill. 2d R. 282.) Rule 282 governs the commencement of an action on a small claim and provides that if the claim is based upon a written instrument, a copy thereof must be attached to the complaint. This is not, however, the commencement of an action on a small claim, but rather a petition to register a foreign judgment governed by the Uniform Enforcement of Foreign Judgments Act and the procedures thereunder. The “claim” here is based on the petition, not on the collection of evidentiary documents defendant lists in his brief. As noted in the order entered on February 1, 1984, these documents were found by the court never to have been submitted or offered as evidence to the trial court or made a part of any pleading or filing submitted to the trial court for its consideration. Consequently, these documents were stricken from the record on appeal. Defendant appears to feel it was plaintiffs’ duty to enter these documents into evidence. It was defendant, however, who had to offer evidentiary support for his opposition to plaintiffs’ petition, for it is he who had to rebut the presumed validity of both the arbitration award and of the foreign court judgment plaintiffs sought to register. For these reasons, we find that defendant has suffered no denial of due process.

Accordingly, we affirm the decision of the trial court granting plaintiffs’ petition to register the foreign judgment in the sum of $1,790.63 with interest thereon from January 28, 1980, and costs of the proceedings.

Affirmed.

JIGANTI and ROMITI, JJ., concur.


source: Caselaw Access Project

author: JUSTICE O’CONNOR

license: Public Domain

text:
    ERIN KOUKOULOMATIS, a Minor, by Carole Koukoulomatis, her Mother and Next Friend, Plaintiff-Appellant, v. DISCO WHEELS, INC., Defendant-Appellee.
    First District (5th Division)
    No. 83—1713
    Opinion filed August 24, 1984.

      Berry and Gore, Ltd., of Chicago (Alan M. Katz and Gregory R. Sun, of counsel), for appellant.
    Orner, Wasserman & Moore, Ltd., of Chicago (Norton Wasserman and Esther Joy Schwartz, of counsel), for appellee.
   JUSTICE O’CONNOR

delivered the opinion of the court:

Minor plaintiff, Erin Koukoulomatis, by her mother, appeals the denial of her request to compel discovery and the entry of a summary judgment in favor of defendant, Disco Wheels, Inc. Plaintiff originally brought suit against defendant to recover damages for personal injuries suffered when she fell while roller skating on a carpeted hallway in defendant’s roller rink. On appeal, plaintiff contends that: (1) the trial court erred in denying her the opportunity to conduct discovery; (2) the trial court erred in striking her Rule 191(b) affidavit filed in opposition to defendant’s summary judgment motion; (3) the trial court was improperly influenced by extraneous matters relating to plaintiff’s counsel’s alleged method of practice; (4) the trial court erred in relying upon an invalid deposition excerpt in reaching its summary judgment determination; and (5) the existence of genuine issues of material fact together with defendant’s inability to prove that plaintiff could not prevail preclude the entry of a summary judgment. For the reasons that follow, we affirm the decision of the circuit court.

In her complaint filed on March 27, 1981, plaintiff alleged that on October 14, 1979, while she was in the exercise of due care as a paying customer inside the premises of defendant’s roller rink, defendant’s careless and negligent acts or omissions, or both, with respect to the maintenance of the carpeted hallway in the roller rink caused her to fall and to sustain internal and external injuries.

In its answer filed June 3, 1981, defendant denied the allegations of negligence and further alleged the affirmative defense of assumption of risk, stating that when plaintiff entered into an agreement with defendant to participate in roller skating activities on defendant’s premises, she assumed the risk of injuries due to falls which ordinarily accompany roller skating activities. Defendant also filed interrogatories to be answered by plaintiff as well as a standard request for production of documents, objects and other tangible things.

In her answers to defendant’s interrogatories, filed November 4, 1981, plaintiff named Charmaine and Laura Buskus, her aunt and cousin, as witnesses to the accident. On February 8, 1983, after having taken the depositions of plaintiff and both named witnesses, defendant filed a motion for summary judgment, supported by the affidavit of one of its attorneys which referred to certain portions of plaintiff’s attached deposition excerpt. Defendant alleged that, based upon plaintiff’s deposition testimony, there were no genuine issues of material fact as to defendant’s negligence. Plaintiff was given until March 7, 1983, to respond and a hearing on the motion was set for March 24, 1983. The record indicates that plaintiff failed to file a response by the court-ordered date or to initiate any discovery. The two-year period for discovery lapsed on March 27, 1983 (circuit court rule 3.3), without plaintiff having made any attempt to commence discovery. The following day, when the cause came on to be heard in the mediation division for fast-track pretrial, plaintiff did not request the court to grant an extension of time for discovery. Defendant’s motion for summary judgment was then transferred to the trial call for hearing, and plaintiff was granted an additional 21 days (until April 18, 1983) within which to respond. Once again, plaintiff failed to respond by the court-ordered extended deadline. On April 28, 1983, plaintiff filed an affidavit pursuant to Supreme Court Rule 191(b) (Rule 191(b) affidavit) (87 Ill. 2d R. 191(b)), signed by one of plaintiff’s attorneys, stating that special interrogatories, production of documents and depositions of defendant’s employees were necessary to respond properly to defendant’s motion for summary judgment. Thereafter, on May 6 and 9, 1983, plaintiff filed, without leave of court, special interrogatories, a notice to produce, a motion requesting that defendant be required to respond to these discovery requests, a standard order for production of documents and standard defendant interrogatories.

Following a hearing on defendant’s motion for summary judgment and on plaintiff’s motion to compel compliance with discovery requests, the trial court entered an order striking plaintiff’s Rule 191(b) affidavit, denying her motion to compel compliance and granting defendant’s motion for summary judgment. Subsequently, plaintiff filed a motion to vacate and for rehearing. Noting that there had been “zero discovery” conducted by plaintiff during the two-year discovery period, the trial court denied plaintiff’s motion. This appeal followed.

Opinion

We first address plaintiff’s contention that the trial court erred in denying her the opportunity to conduct discovery. The record does not support this contention. From March 27, 1981, the date on which the complaint was filed, until April 28, 1983, the date on which the Rule 191(b) affidavit was filed, plaintiff made no attempt to conduct discovery. Furthermore, she ignored two court-ordered response dates with respect to defendant’s motion for summary judgment and made no attempt to secure an extension for discovery once the statutory period had expired. As an excuse for her inaction, plaintiff pleads “extraordinary circumstances” in the form of a settlement discussion, and cites several cases which held that the trial court’s refusal to permit discovery was an abuse of discretion.

We fail to find that the requisite “extraordinary circumstances” necessary to secure a discovery extension existed in the present case and concur with the trial court’s refusal to permit discovery. Pursuant to the affidavit attached to plaintiff’s motion to vacate, defendant’s settlement offer was made “just prior” to the pretrial hearing which was held on March 28, 1983. Thus, by plaintiffs own admission, nearly two years had elapsed before the occurrence of the alleged “extraordinary circumstances,” during which time plaintiff had made no attempt to conduct discovery. Plaintiffs contention that defendant would not be prejudiced by allowing a discovery extension is equally unpersuasive.

Finally, after careful review of those cases cited by plaintiff for the proposition that denial of discovery is an abuse of discretion, we conclude that they are factually inapposite and, consequently, are of no persuasive value. In Dobbs v. Safeway Insurance Co. (1978), 66 Ill. App. 3d 400, 384 N.E.2d 34, plaintiff had made several conscientious attempts to secure discovery, but was thwarted by defendant’s failure to cooperate as well as by other matters outside of his control. In Hanes v. Orr & Associates (1977), 53 Ill. App. 3d 72, 368 N.E.2d 584, defendant refused to produce an essential employee for the purposes of plaintiff’s deposition. In Schrier v. Indiana Harbor Belt R.R. Co. (1981), 102 Ill. App. 3d 855, 430 N.E.2d 204, plaintiff’s deposition was covertly taken by defendant without notice to the third-party defendant from whom defendant was seeking indemnity. Finally, in Slatten v. City of Chicago (1973), 12 Ill. App. 3d 808, 299 N.E.2d 442, plaintiff’s disregard of court orders and discovery rules, together with her failure to notify defendant of her presence in the city for purposes of taking a deposition, were directly responsible for defendant’s delay in conducting discovery. In the present case, defendant was not responsible for plaintiff’s delay.

Plaintiff further argues that her Rule 191(b) affidavit in opposition to defendant’s motion for summary judgment was erroneously stricken. We disagree. Pursuant to Rule 191(b), an affidavit must contain the following information before the trial court is required to act upon it: (1) a statement that material facts are unavailable due to hostility or otherwise; (2) the names of those persons the affiant wants to depose; (3) a showing as to why affidavits could not be procured from those named persons; (4) a statement as to what those persons will testify; (5) the basis for the affiant’s belief that those persons will so testify; and (6) the affiant must be a party to the action.

In the present case, plaintiff’s Rule 191(b) affidavit is void of any of the required information and, as such, fails in its purpose. Therefore, we concur with the trial court’s decision to strike the affidavit and to deny plaintiff’s motion to compel discovery.

Next, plaintiff argues that the trial court allowed similar past practices of plaintiff’s counsel to improperly influence his decision and that the summary judgment order was tantamount to a sanction against her for failing to seek discovery earlier in the case. Specifically, plaintiff takes exception to comments made by the trial court during the hearing on the motion to vacate which referred to the numerous motions made by plaintiff’s counsel in other cases for extensions to comply with discovery or to file answers to summary judgment motions. After a thorough review of the record, we do not find any evidence that the trial court had been improperly influenced by irrelevant considerations. Those comments which referred to plaintiff’s counsel’s method of practice were articulated after a well-reasoned decision had been rendered on the merits of defendant’s motion for summary judgment and after the trial court had reiterated its position at the hearing on the motion to vacate. Furthermore, there is no evidence in the record that the summary judgment order was entered as a sanction for plaintiff’s failure to demonstrate that genuine issues of material fact existed.

Plaintiff further argues that because the attachment of her deposition testimony to the summary judgment motion did not conform to the requirements of Supreme Court Rule 207 (Rule 207) (87 Ill. 2d R. 207), the trial court should not have accepted or considered the deposition excerpt.

Pursuant to Rule 207, a deposition must be: (1) signed by the deponent or contain a waiver of signature; (2) certified by the officer; and (3) promptly filed with the court. In the present case, it is undisputed that the deposition excerpt attached to defendant’s motion for summary judgment did not conform to the aforementioned requirements. If plaintiff had timely filed a motion to suppress the deposition in accordance with Supreme Court Rule 211(d) (87 Ill. 2d R. 211(d)), such nonconformance likely would have resulted in the invalidity of the deposition for consideration by the trial court. (Miscevich v. Commonwealth Edison Co. (1982), 110 Ill. App. 3d 400, 403, 442 N.E.2d 338; Bezin v. Ginsburg (1978), 59 Ill. App. 3d 429, 436, 375 N.E.2d 468.) However, plaintiff failed to file the motion and, as a result, has waived any errors or irregularities in connection with the deposition. Smith v. Ashley (1975), 29 Ill. App. 3d 932, 934, 332 N.E.2d 32; see also Fooden v. Board of Governors (1971), 48 Ill. 2d 580, 588, 272 N.E.2d 497, cert, denied (1972), 408 U.S. 943, 33 L. Ed. 2d 766, 92 S. Ct. 2847.

Finally, plaintiff argues that the existence of genuine issues of material fact, together with defendant’s inability to prove that plaintiff could not prevail, preclude the entry of a summary judgment. It is axiomatic that summary judgment should be granted only in those instances where there is no genuine issue of material fact. Further, when facts contained in an affidavit in support of a motion for summary-judgment are not contradicted by counteraffidavit, such facts are admitted and must be taken as true. Prather v. Decatur Memorial Hospital (1981), 95 Ill. App. 3d 470, 472, 420 N.E.2d 810.

In the present case, plaintiff has failed to contradict any of the allegations set forth in defendant’s motion and supporting affidavit. Yet, when confronted with this fact, plaintiff ignores the obvious impact of her failure to respond and focuses instead on defendant’s alleged inability to show that plaintiff can never prove her case. Contrary to plaintiff’s position, it is not incumbent upon defendant to prove its case or to disprove plaintiff’s case in a motion for summary judgment. Instead, defendant must establish that there is no genuine issue of material fact. In effect, plaintiff did this for defendant by failing to file a counteraffidavit. The mere fact that witnesses exist does not establish a genuine issue. If their testimony would have done so, affidavits to that effect should have been filed in answer to defendant’s motion.

Plaintiff argues that defendant’s right to summary judgment was not clear beyond question because plaintiff’s deposition excerpt did not “constitute a clear and unequivocal admission that she does not know”'what caused her to fall. We agree that plaintiff’s comment that the carpet “[m]ust have gone up a little bit that I tripped over it” indicates that she did not know with certainty the cause of her fall. However, we find that this uncertainty hinders, rather than helps, plaintiff’s position. Plaintiff’s allegations of negligence are grounded solely on her speculation that something must have been wrong with the roller rink carpeting. It is well established that mere conjecture or surmise is insufficient to establish a genuine issue as to negligence. (See Kimbrough v. Jewel Cos. (1981), 92 Ill. App. 3d 813, 817, 416 N.E.2d 328.) In order to prevent the entry of a summary judgment, the non-moving party must present a bona fide factual defense and not hide behind equivocations and general denials. (Wainscott v. Penikoff (1936), 287 Ill. App. 78, 4 N.E.2d 511.) In our opinion, plaintiff has failed to meet this burden.

For the foregoing reasons, the judgment of the circuit court of Cook County is affirmed.

Affirmed.

MEJDA, P.J., and LORENZ, J., concur.


author: JUSTICE PERLIN

text:
      In re MARRIAGE OF CAROL MELNICK, Petitioner-Appellee, and HERBERT G. MELNICK, Respondent-Appellant (Marshall J. Auerbach, Appellee).
    First District (2nd Division)
    No. 83—2189
    Opinion filed August 28, 1984.

      Fox and Grove, Chartered, of Chicago (Lawrence M. Cohen, Alan L. Unikel, and Martin K. Denis, of counsel), for appellant.
    Marshall J. Auerbach & Associates, Ltd., of Chicago, for appellee Marshall J. Auerbach.
    Neil A. Robin, P.C., of Chicago (Neil A. Robin, of counsel), and Paul R. Jenen, of Wheeling, for appellee Carol Melnick.
   JUSTICE PERLIN

delivered the opinion of the court:

Respondent Herbert G. Melnick (Herbert) appeals the property apportionment and attorney fees portions of a judgment entered on December 2, 1982, in the circuit court of Cook County dissolving his marriage to petitioner Carol Melnick (Carol). On appeal, Herbert contends that the trial court’s valuation of Herbert’s limited partnership investments and of his stock in Modern Management, Inc., was against the manifest weight of the evidence and that the trial court abused its discretion in ordering Herbert to contribute $85,000 toward Carol’s attorney fees and costs.

Herbert and Carol were married in Cook County on August 11, 1956. Three children were born of this marriage: Elizabeth, born July 6, 1957; Michael, born February 2, 1959; and Marianne, born June 12, 1961. All are adults. On June 23, 1980, Carol filed a petition for dissolution of marriage, alleging mental cruelty.

The trial testimony addressed principally the value of 22 limited partnership investments owned by Herbert and the value of Herbert's 20,088 shares of stock in Modern Management, Inc., a closed corporation engaged in the business of labor relations consulting.

(1) Limited Partnership Investments

Shayle Fox, corporate attorney for Modern Management and Herbert’s personal attorney, testified to the value of the 22 limited partnership investments. In seeking a method to evaluate these investments, Fox hired Duff and Phelps, Inc., professional appraisers, who evaluated one of the investments, Raintree, by utilizing a formula under which a 70% to 85% discount factor was applied to the “estimated value” of the investment in order to assess its present dollar value. In order to avoid the substantial expense of individual appraisals, Fox adapted this formula in valuing the remaining investments. Fox concluded that the overall value for all 22 investments was $840,000, and by applying a 75% discount, he arrived at $210,000.

Robert Rome, a certified public accountant, testifying on behalf of Carol, disagreed with the 75% discount applied by Fox because he considered most of the “shelters” to be “economically viable investments.”

Bruce H. Brenner, a professional real estate appraiser and Carol’s brother, testified that to value investments of the kind here involved, “each one has to be looked on individually.”

In its evaluation of 14 of the limited partnership investments, the trial court adopted the values fixed by Fox. The trial court said it would not value any of the particular interests at a figure lower than that suggested by Fox, and the court concluded that the total fair market value of these investments was $318,675. Subsequent evidence with regard to the Carbondale property, however, resulted in increasing the trial court's evaluation of the investments to $495,598. The trial court awarded 18 limited partnership interests to Herbert (valued at $423,348) and four to Carol (valued at $72,250).

(2) Modern Management, Inc., Stock

Herbert testified that he is chairman of the board of directors of Modern Management, Inc., a closely held corporation specializing in labor relations consulting. He owns approximately 32% of its outstanding shares.

Robert Urgo, an investment manager hired by Carol to determine the fair market value of Herbert’s interest in Modern Management, testified that he examined the company’s financial statements for the years 1976-1981, the Federal corporate income tax returns for 1976-1980, the company’s promotional and marketing literature, the deposition of Victor Siting (Herbert’s expert witness for valuing Herbert’s interest), Biting’s summaries of the company’s value prepared in 1980 and 1981 and published financial information relating to companies similar to Modern Management.

By applying what he deemed an appropriate price/earnings ratio formula, i.e., 8:6, Urgo computed the fair market value of Modern Management to be $108.38 per share. However, when he considered the percentage of the company owned by Herbert, his position in the company, the change in shareholdings that occurred over the last five to six years and a buy-sell agreement existing between the company and the key stockholders, he concluded that the fair market value of Herbert’s interest was $92.12 per share.

Called subsequently to testify as a rebuttal witness, Urgo stated that he had examined exhibits detailing reductions in the salaries of Modern Management’s officers. In light of this new information, he concluded that the fair market value of Herbert’s stock interest was $77.76 per share.

Victor Biting, an investment banker, testified that he appraised the stock of Modern Management in 1980 and again in 1981. On July 31, 1981, Biting calculated a per share value of $13.23. Biting stated that at the time of trial, however, the market value of Herbert’s stock was $3.83 per share.

James L. Bannon, a partner between 1972 and 1980, stated in an evidence deposition that in 1979, the “shareholders” of the company had valued the stock at $100 per share, although he would not have paid that price. In 1980, Bannon sold his 3,000 shares of stock to Modern Management for $50,000 ($16.67 per share).

Raymond F. Mickus, a former partner of Modern Management, testified that he owns 16% of the company’s stock. At an officers’ meeting in 1978, the value of its stock was set at $66.67 per share. In 1979 the officers agreed upon a value of $100 per share. In 1981, after “Mr. Melnick started having some marital difficulties the stock plummeted to $10.96.” Mickus opined, however, that in 1982 the stock was worth $100 per share.

Shayle Fox testified that at an officers’ meeting in 1978, the stock was valued at $100 per share. In 1979, however, according to appellee’s brief, 300 shares of stock were sold to each of four employees at $53.52 per share.

Robert Rome, a certified public accountant, testified that he “presumed” that the officers in 1978 “knew what they were doing when they set the value” at $66 per share. He also noted that in November 1979 the value was increased to $100 per share.

Richard Baer, certified public accountant for Modern Management, testified that the book value of the company stock as of November 30, 1981, was $4 per share, but “that he would advise Mr. Melnick to sell the stock for more than its book value.” Baer indicated that the company had never had its books audited but that in his view it was “well run.”

Dennis Bauman, vice president and controller of Modern Management, testified that when Joseph Vella, one of the former employees, left the company in March 1982, Vella sold his 300 shares of stock back to Modern Management for $10.96 per share, a price substantially less than his original subscription price but which was subsequently reduced by the company.

The trial court, in its evaluation of the company stock, reviewed all evidence pertaining to its value. The trial judge noted the difficulty of definitively fixing stock value in a closed corporation where the knowledge of the employees constitutes an essential element of the company’s value. He therefore considered Herbert's position in the company and the expertise he provided. The trial judge was unable to accept any one formula presented by the various witnesses. The judge “factor[ed]” in all of the evidence, however, and concluded that the stock value was $35 per share. Exercising its discretion, the trial court divided the marital assets on a 60-40% basis, awarding $1,986,928 to Herbert and $1,324,618 to Carol.

(3) Attorney Fees

Marshall J. Auerbach was Carol’s attorney from March 26, 1980, to April 14, 1983.

Auerbach testified that he is a matrimonial law expert and that he co-authored the 1977 Illinois Marriage and Dissolution of Marriage Act. He was present at all discovery depositions and the 13-day trial. Time sheets reflecting the attorneys’ time spent on this case were admitted into evidence. Auerbach stated that it was a difficult and lengthy task to establish the value of the assets involved and claimed that 1,441 hours were devoted to this case by him and his staff.

Auerbach billed Carol $150 per hour for his time. His associates billed Carol at rates between $38 and $75 per hour.

James T. Friedman and Victor Neumark, two matrimonial lawyers, testified that Auerbach is “highly qualified” in the field of matrimonial law. Neumark characterized Auerbach’s fees as “reasonable.”

Auerbach billed Carol for $200,867.61 as his fees, costs and expenses. The trial judge emphasized that he expressed no opinion on the fees charged by Auerbach apart from the amount to be assessed against Herbert. The trial judge considered the level of expertise required in this case, he examined the time records submitted by Auerbach and he considered the resources and the income potential of Carol and Herbert. Although the judge found that Carol had substantial capacity to pay fees, he held her entitled to assistance in this regard from Herbert. The trial judge concluded that Herbert should contribute toward Carol’s attorneys as fees and expenses a total of $85,000, and so ordered.

I

Herbert initially contends that the trial court erred in its evaluation of the 22 limited partnership investments. Herbert argues that only Fox “provided the essential oral testimony” as to value, that Fox’ testimony was “not rebutted,” and that the trial court erred when it “ignored” Fox’ testimony.

Carol notes that the trial court, in addition to Fox’ testimony, did in fact also consider the testimony of Rome and Brenner, and reviewed financial statements prepared by Herbert.

Section 503(c) of the Illinois Marriage and Dissolution of Marriage Act (Ill. Rev. Stat. 1981, ch. 40, par. 503(c)) directs the trial court to divide marital property upon dissolution of marriage in “just proportions considering all relevant factors.” (Emphasis added.) The Act does not prescribe an equal division of marital property (In re Marriage of Aschwanden (1980), 82 Ill. 2d 31, 411 N.E.2d 238). Thus, here, the trial judge awarded 18 limited partnership investments to Herbert and four to Carol.

To apportion marital assets under section 503 of the Act, the value of such assets must first be established. (In re Marriage of Wilson (1982), 110 Ill. App. 3d 809, 443 N.E.2d 31.) The trial court, however, is not required to make specific findings of fact as to the value of each marital asset, “so long as the evidence of value in the record is sufficient to enable a court of review to analyze the propriety of the trial court’s disposition.” In re Marriage of Shafer (1984), 122 Ill. App. 3d 991, 996, 462N.E.2d 39.

In the instant case, both parties had ample opportunity to present evidence of the value of Herbert’s 22 limited partnership investments, and the record indicates there was in fact detailed evidence in this regard. The trial judge reviewed the value placed on the partnerships by Herbert, by Fox and by Duff and Phelps, Inc., as well as the methods each used to appraise valúe. The trial judge adopted the value Fox placed on 14 of the investments, but because he differed with Fox’ method for appraising the remaining “shelters,” the trial judge applied his own formula which he based on evidence provided by Fox, Rome and Brenner and by Herbert’s financial statements.

From the record we conclude that, contrary to Herbert’s argument, the trial judge did not “ignore” Fox’ testimony, but rather he disagreed with Fox’ formula in some instances and substituted his own basis for computing value. It appears to us that the trial judge went to unusual lengths seeking what he deemed a fair division of the marital assets. In our opinion, the trial court’s valuation of the limited partnership investments was supported by the evidence.

II

Herbert also contends that the trial court selected a “compromise” figure in appraising the Modern Management stock at $35 per share and that such figure was contrary to the manifest weight of the evidence.

The worth of a corporation’s stock is usually its market value, which is defined as “the price which a willing purchaser will pay to a willing seller in a voluntary transaction.” (In re Marriage of Olsher (1979), 78 Ill. App. 3d 627, 635, 397 N.E.2d 488, 494.) Valuation based upon market value should, of course, be determined as accurately as is professionally possible using such business and accounting expertise as may be available. Although there may be no established market for the stock of a closed corporation, “courts have recognized an ascertainable value” for such shares. In re Marriage of Reib (1983), 114 Ill. App. 3d 993, 1000, 449 N.E. 919, 925.

In In re Marriage of Mitchell (1981), 103 Ill. App. 3d 242, 248, 430 N.E.2d 716, 720, the court held that “precise rules for determining the value of closely held stock cannot be laid down but that every relevant evidential fact entering into the value of the corporate property reflecting itself in the worth of the corporate stock should be considered, including past sales if relevant.”

In the instant case, the trial judge, noting the difficulty in ascertaining the value of stock in a closed corporation, reviewed the company’s financial statements, Federal tax returns and marketing literature. Ten witnesses testified to the value of the stock. The trial court was presented with a range from $3.83 to $108.83 per share, based on a number of different formulas used by the witnesses. The trial judge carefully reviewed the appraisal methods and the values placed on the stock by each witness. The trial judge does not appear to have arbitrarily chosen a “compromise” figure, but arrived at the $35 per share value by applying the various formulas and factors in his effort to establish its reasonable value.

In our opinion, there was ample evidence on which the trial court based its decision, and we do not believe its findings were against the manifest weight of the evidence.

Ill

Finally, Herbert contends that the trial court abused its discretion when it ordered Herbert to contribute $85,000 toward Carol’s attorney fees and costs which total $200,867.61. Herbert argues that (1) Carol has the financial ability to pay her own attorney fees and (2) the fees charged by Carol’s attorney, Marshall Auerbach, were unreasonable because “many of the hours he claims constituted unnecessary, duplicative work.”

Carol argues that the trial court properly based its order that Herbert contribute toward her attorney fees on the criteria outlined in section 508 of the Illinois Marriage and Dissolution of Marriage Act.

Appellee Marshall Auerbach, in a separately filed brief, argues that his fees were reasonable and that the trial court’s order that Herbert contribute $85,000 toward his total fees and costs was not an abuse of discretion.

Section 508 of the Illinois Marriage and Dissolution of Marriage Act (Ill. Rev. Stat. 1981, ch. 40, par. 508(a)) provides:

“The court from time to time, after due notice and hearing, and after considering the financial resources of the parties, may order either spouse to pay a reasonable amount for his own costs and attorney’s fees and for the costs and attorney’s fees necessarily incurred by the other spouse ***.”

The allowance of attorney fees in a dissolution proceeding rests within the sound discretion of the trial court, and that discretion will not be disturbed unless it is clearly abused. In re Marriage of Sipick (1980), 80 Ill. App. 3d 883, 400 N.E.2d 696.

Before awarding attorney fees, the court may consider one spouse’s greater financial ability to pay. The inability of a spouse to pay fees need not be tantamount to destitution. In re Marriage of Shedbalkar (1981), 95 Ill. App. 3d 136, 419 N.E.2d 409.

With regard to Herbert's contention that Carol has the financial ability to pay her own attorney fees, the trial court found that Herbert “is receiving a great deal of property, and in addition to that, he has a very, very, very substantial earning capacity”; that Carol’s “earning capacity in comparison to that of Mr. Melnick is negligible”; and that considering the balance sheet and income estimates, Carol “essentially has a substantial capacity to pay fees, but that she is entitled to assistance from Mr. Melnick ***.” The trial judge noted that he was making a “judgment call” and exercised his discretion by ordering Herbert to contribute $85,000 toward Carol’s attorneys’ total fees and expenses of $200,867.61.

It appears to us from the record that the trial court based its order upon a consideration of the parties’ total financial resources and its proposed apportionment of marital assets. Carol was awarded 40% of the marital assets and $26,000 for maintenance. Herbert was awarded 60% of the marital assets and had a substantially greater earning potential than Carol. In our opinion, the trial court did not abuse its discretion in ordering Herbert to contribute $85,000 toward Carol’s attorney fees and costs.

With regard to Herbert’s contention that the fees were unreasonable, we have previously noted that Herbert’s counsel does not dispute the accuracy of Auerbach’s time records or the propriety of his rates. Although Herbert’s counsel has questioned in a general manner a comparatively few hours for which fees were charged, he did not establish a substantial variance. It must also be borne in mind that in the instant case Herbert is not called upon to pay all fees and costs or a specific percentage thereof, but to contribute a specific amount toward that total. The trial judge expressed no opinion relative to the overall fee arrangement Carol had with her attorney.

It has been held that “[t]he amount of an attorneys’ fees award is dependent upon whether the work was reasonably required and necessary for the proper performance of legal services under the circumstances” (In re Marriage of Thornton (1980), 89 Ill. App. 3d 1078, 1093, 412 N.E.2d 1336, 1348). In determining whether the amount of fees awarded is reasonable, the factors to be considered are: “(1) the skill and standing of the attorneys employed; (2) the nature of the controversy, and the novelty and difficulty of the questions at issue; (3) the amount and importance of the subject matter, especially from a family law standpoint; (4) the degree of responsibility involved in the management of the case; (5) the time and labor required; (6) the usual and customary charge in the community; and (7) the benefits resulting to the client.” In re Marriage of Thornton (1980), 89 Ill. App. 3d 1078, 412 N.E.2d 1336.

In this instance, two matrimonial lawyers testified to Auerbach’s qualifications and that his fees in this case were reasonable. The trial judge noted that the appraisal of marital assets in this case was a complex task, and he apparently accepted Auerbach’s itemization of his time and services rendered.

In our opinion, the trial court did not abuse its discretion in ordering Herbert to contribute $85,000 toward Carol’s attorney fees and costs. The evidence provides a sufficient basis for the trial court’s award of such amount.

For the reasons herein stated, we affirm the judgment of the trial court.

Affirmed.

STAMOS and DOWNING, JJ., concur.

       At times the trial court and the parties refer to 21 partnership investments. This discrepancy occurred because one of the partnerships (Carbondale) actually consisted of two separate parcels of real estate. For purposes of this opinion we shall use the number 22.

       This figure represents approximately 32% of the outstanding shares of stock in Modern Management.

       At the same time, however, Bannon was given a consulting agreement by Modern Management for $272,500, which raises a question as to the validity of the $16.67 per share price.

       Herbert’s counsel does not dispute the accuracy of Auerbach’s time records or the propriety of his rates. He does question the need for some of the services performed.

       Herbert filed a reply brief in which he argues that: (1) the trial court failed to value the stock at its present value; and (2) the trial court failed to consider that the major portion of the stock’s value reflected Herbert’s covenant not to compete. Carol moved to strike these portions of the reply brief under Supreme Court Rule 341(g) (Ill. Rev. Stat. 1981, ch. 110A, par. 341(g)), alleging that Herbert raises two new issues that were not argued in Herbert’s original brief and were not in response to arguments raised in Carol’s brief. This court took Carol's motion with the case.
      In Herbert’s original brief, he argued that the trial court erred in failing to value the stock according to the evidence and in failing to consider the limited market for a closed corporation in which the partners constitute an important asset of the company.
      We find that the arguments raised by Herbert in his reply brief are not substantially different from the issues raised in his original brief. We therefore deny Carol’s motion to strike portions of Herbert’s reply brief.


author: JUSTICE DOWNING

text:
    AMERICAN FAMILY LIFE ASSURANCE COMPANY, Plaintiff-Appellant, v. EDWIN J. TAZELAAR et al., Defendants-Appellees.
    First District (2nd Division)
    No. 84—586
    Opinion filed August 28, 1984.
    Gerald B. Mullin, Robert T. O’Donnell, and Randall E. Server, all of Epton, Mullin, Segal & Druth, Ltd., of Chicago, for appellant.

      Michael C. Cook and Daniel A. Murray, both of Peterson, Ross, Schloerb & Seidel, of Chicago, for appellees.
   JUSTICE DOWNING

delivered the opinion of the court:

This appeal questions the validity, based upon Georgia law, of a covenant not to compete contained in an employment agreement.

American Family Life Assurance Company (American Family), plaintiff, filed an action to enjoin defendants, six of its former employees, from (1) inducing other salespersons to terminate their agreements with plaintiff, (2) inducing policyholders to relinquish their policies written with plaintiff, (3) divulging the names of policyholders to plaintiffs competitors, and (4) making available to competitors information and material acquired from plaintiff.

Defendants, as salespersons for plaintiff, signed agreements with plaintiff promising to refrain from doing these acts. The pertinent provisions of the agreements were:

“PARAGRAPH SEVEN: Covenant Not To Compete
(a) During the term of this agreement and for a period of two (2) years after the termination of this Agreement, the Associate agrees that the Associate shall not, within the geographic area where the Associate has sold and serviced policies for American Family, engage in any of the following:
(1) Attempt to induce other Associates or sales agents of American Family to terminate their agreements with American Family or to become contracted or associated with another insurance company.
(2) Attempt to induce policyholders or accounts of American Family to relinquish their policies.
(3) Divulge the names of American Family policyholders, accounts, or agents to any competitor or potential competitor of American Family.
(4) Make available any information or materials acquired from American Family to any competitor or potential competitor of American Family.
(5) Sell or service an accident and health insurance policy for any other company which competes with any of the policies which the Associate has sold for American.
(6) Become a partner, associate, affiliate, employee or independent contractor with any person or company which sells or services accident and health insurance policies which compete with policies which the Associate has sold for American Family.”

The agreement also contained (i) a provision that it is governed by the laws of the State of Georgia, and (ii) a severability clause that if any paragraph or subparagraph be held invalid, illegal or unenforceable, such will not affect any other provision of the agreement.

The trial court entered a temporary restraining order. Defendants filed a verified answer to the complaint, the parties filed memoranda of law, and oral arguments followed. The trial court, in considering paragraph seven, held (1) the law does not permit the blue-penciling of restrictive covenants in employment contracts and that the covenant must stand or fall as a whole, and (2) if any provision is unenforceable, the entire clause is unenforceable. The court found that subparagraph 6 of paragraph seven is overly broad and unenforceable. Therefore, no part of paragraph seven could be enforced. Finding that plaintiff failed to demonstrate that it was likely to prevail on the merits, the trial court denied plaintiff’s motion for a preliminary injunction.

We are asked (1) whether nondisclosure covenants, as part of a covenant not to compete, are valid and enforceable when the trial court determines the covenant not to compete is not enforceable, and (2) whether plaintiff was entitled to enjoin defendants from attempting to induce plaintiff’s policyholders to relinquish their policies.

I

The agreement provides, and the parties agree, that Georgia law applies. In Richard P. Rita Personnel Services International, Inc. v. Kot (1972), 229 Ga. 314, 315, 191 S.E.2d 79, 80, a franchise agreement contained a covenant in one paragraph, whereby Kot, the franchisee, agreed "*** that for a period of two years after the termination of the franchise agreement that he would not compete with Rita in Fulton, Cobb and De Kalb Counties (Georgia) or in any territorial areas in which a franchise has been granted by Rita.” Rita sought to enforce only that part of the covenant applicable to the three designated counties and urged that Georgia courts adopt the “blue-pencil theory of severability,” deleting the words “or in any territorial area in which a franchise has been granted by Rita.” Based on previous decisions, the Georgia Supreme Court held that the restrictive covenant, when read in its entirety, is unenforceable; further, the court declined to adopt the “blue-pencil theory of severability.” In other words, the court refused to sever from the one paragraph that part of the covenant which made the entire covenant unenforceable, and then hold enforceable that which remains after severance.

Durham v. Stand-By Labor of Georgia, Inc. (1973), 230 Ga. 558, 198 S.E.2d 145, considered a post-employment restriction in an employee’s contract. Paragraph 11, a general noncompetition provision, provided that upon termination of employment, for a period of one year, the employee would not engage in any competition activity within (a) a radius of 50 miles of Atlanta, Georgia, and (b) a radius of 50 miles of any city in which the employer, or any affiliated company, is operating at the time employment is terminated. Paragraph 12 was a specific one-year nondisclosure of customer information provision. A specific severability clause was included. The court held that the non-competition provision as a whole was overly broad and unreasonable in restraint of trade. The court noted Rita and observed that the result in Rita was reached despite a specific contractual provision that its illegal clauses were severable. However, as to the nondisclosure provision, paragraph 12, the court held it was not void as a matter of law, and its reasonableness must be established at trial.

In Howard Schultz & Associates of the Southeast, Inc. v. Broniec (1977), 239 Ga. 181, 236 S.E.2d 265, a covenant not to compete was held to be defective as overly broad, and a covenant against disclosure of information was unenforceable as it contained no time limitation. In Nasco, Inc. v. Gimbert (1977), 239 Ga. 675, 238 S.E.2d 368, the supreme court held that an employment contract’s nondisclosure covenant was unreasonably broad and therefore unenforceable.

Uni-Worth Enterprises, Inc. v. Wilson (1979), 244 Ga. 636, 261 S.E.2d 572, involved former officers of the corporation who sought a declaratory judgment that restrictive covenants in their employment contracts were void and unenforceable. Each restrictive covenant contained four subparagraphs which prohibited the employee from doing certain enumerated acts “competitive with any services or products offered or possessed by Employer.” The court noted that two of the sub-paragraphs were not too indefinite to be enforced. However, subparagraph (d) was unenforceable because it prohibited the employee from entering into a business competitive with the employer and also prohibited the employee from entering into any such business “as sole proprietor, partner, officer, or employee.” The supreme court held that subparagraph (d) was unquestionably unenforceable and, rejecting the “blue-pencil theory of severability” as applied to restrictive covenants in employment contracts, concluded that the entire covenant was unenforceable.

In Rollins Protective Services Co. v. Palermo (1982), 249 Ga. 138, 287 S.E.2d 546, a restrictive covenant case, the trial court denied the employer’s application for an interlocutory injunction because of the overbreadth and unreasonableness of the pertinent covenants, but issued an injunction restricting the employee, Palermo, from transacting business with any customer of the employer, Rollins, known to Palermo as a result of his employment. Both parties appealed.

The restrictive covenants were set out in seven subparagraphs of paragraph 5 of the employment contract. The trial court found one subparagraph (the sale of products) overly broad, and a second (a territorial restriction) unreasonable. The supreme court held that as the territorial restriction prevented the employee from competing against the employer in an area greater than the area in which he had worked, this was unreasonable. It further reaffirmed its rejection of the “blue-pencil theory of severability” in that if any of the subparagraphs are invalid, the entire covenant must fall. Thus, the supreme court held the entire covenant was unenforceable.

With respect to the trial court’s order restricting Palermo from transacting business with any customer known to him as the result of his employment with Rollins, the court noted that:

“Public policy supports the protection of an employment agreement imposing a duty on an employee to refrain from disclosing confidential business- information of the employer. Durham v. Stand-By Labor of Georgia, Inc., 230 Ga. 558, 198 S.E.2d 145 (1973). ‘[A] claim for breach of a covenant not to compete and one for wrongful disclosure and use of confidential information in violation of contract may be maintained separately and independently under the same or distinct provisions of the employment agreement.’ Ibid, at 562-63 [198 S.E.2d 145]. ‘In determining whether restraints on disclosure are reasonable, two factors are of importance: (1) Whether the employer is attempting to protect confidential information relating to .the business, such as trade secrets, methods of operation, names of customers [and] personnel data *** and (2) whether the restraint is reasonably related to the protection of the information.’ Ibid, at 564 [198 S.E.2d 145].” 249 Ga. 138, 142, 287 S.E.2d 546, 550.

Although the supreme-court noted that the issue of the reasonableness of the nondisclosure clause was not developed, the court found the injunction far broader than the nondisclosure clause in the employment agreement, and goes beyond protecting a trade secret or confidential information. The court concluded that it was an injunction against competition and was therefore reversible error.

II

We next consider whether nondisclosure covenants as part of a covenant not to compete are valid and enforceable.

The instant complaint for injunction and other relief, relying upon subparagraphs (a)(1) through (4) of paragraph seven entitled, “Covenant Not to Compete” requested relief based upon the said four sub-paragraphs. Subparagraphs 3 and 4 can be classified as nondisclosure covenants. Subparagraphs 1 and 2 do not fall into either label as noncompetitive or nondisclosure. The temporary restraining order entered February 10, 1984, enjoined defendants from doing what was prohibited in subparagraphs 1 through 4.

However, the trial court, in denying plaintiff’s request for a preliminary injunction to prohibit the defendants from doing that prohibited in the said four subparagraphs, concluded that:

“*** That law does not permit the blue-penciling of such covenants and therefore requires that the covenant must stand or fall as whole. If any provision therein is unenforceable, the entire clause is unenforceable.
It appears to this Court that subparagraph 6 of Paragraph Seven of the Associate’s Agreement is overly broad and unenforceable. Therefore plaintiff can enforce no part of the paragraph. Because the paragraph upon which plaintiff relies in its motion is unenforceable, plaintiff fails to demonstrate that it is likely to prevail on the merits.”

Plaintiff points out that paragraph seven contains two nondisclosure covenants as well as two noncompetitive covenants, that the relief requested pertained in part to the nondisclosure covenants, and as no relief was requested based on a covenant not to compete, the trial court was in error.

So far as we can determine from the applicable Georgia cases, this identical problem has not been resolved. There is no question under Georgia law that if plaintiff was seeking to enjoin defendants under subparagraphs 5 and 6, the Georgia law would prohibit such action on the basis of over-breadth. On the other hand, we believe that as plaintiff’s requested relief pertained in part to the nondisclosure covenants in paragraph seven, such action is permissible.

In Durham, the court held that as a matter of law a nondisclosure provision is valid, but that its reasonableness must be established at trial. 230 Ga. 558, 563-64, 198 S.E.2d 145, 149-50. See also Howard Schultz & Associates of the Southeast, Inc. (1977), 239 Ga. 181, 187-88, 236 S.E.2d 269, 270; Nasco, Inc. v. Gimbert (1977), 239 Ga. 675, 678, 238 S.E. 369, 370; Rollins Protective Services Co. v. Palermo (1982), 249 Ga. 138, 142-43, 287 S.E.2d 546, 550.

We think that under Georgia law, an action to prevent wrongful disclosure may be maintained subject to a determination as to the covenants’ reasonableness on factors of time and the nature of the business interest sought to be protected. The fact that the nondisclosure provisions are included as separate subparagraphs of a paragraph entitled “Covenant Not to Compete” should not per se defeat the right of action. Nor do we think this conclusion violates the well-established maxim that Georgia courts have declined to adopt the “blue-pencil theory of severability.” Here, the employer seeks to proceed separately on the nondisclosure provisions. The trial court was not asked to modify, alter, delete or change words in the covenant. It was merely asked to interpret whether there was a violation of the words used in subparagraphs (1) through (4) of paragraph seven.

The trial court based its ruling on its finding that subparagraph (6) was overly broad and unenforceable. But that subparagraph is a noncompetition provision, and plaintiff did not base the instant action on subparagraph (6). The trial court then held that as subparagraph (6) was defective, the entire paragraph could not be enforced. As set forth in Rita, the “blue-pencil theory of severability” would delete words from a covenant that cause such covenant to be legally unenforceable. The Georgia court refused to redraft the covenant. We refuse to do so here.

As the trial court did not test the nondisclosure provisions to determine the reasonableness of time and the business interest sought to be protected, accordingly the matter is being reversed and remanded with directions to conduct a hearing and make such determination consistent with the laws of the State of Georgia.

The trial court noted that subparagraphs 1 and 2 could not be called noncompetitive. We agree. Accordingly, the trial court should, upon remand, determine the validity of these provisions including their reasonableness.

Ill

Although plaintiffs complaint alleged, under separate counts, violation of the Illinois Insurance Code, a breach of, and intentional interference with, a contract, the trial court did not rule on these matters. Accordingly, we do not address these matters in this opinion.

The judgment of the circuit court of Cook County is reversed and remanded with directions.

Reversed and remanded with directions.

STAMOS and PERLIN, JJ., concur.


author: JUSTICE CAMPBELL

text:
    STATE FARM MUTUAL AUTOMOBILE INSURANCE COMPANY, Plaintiff-Appellee, v. JEFFERY R. OSS et al., Defendants (Helen Lally, Defendant-Appellant; National Ben Franklin Insurance Company, Intervening Appellant).
    First District (1st Division)
    No. 83—983
    Opinion filed August 20, 1984.
    Clausen, Miller, Gorman, Caffrey & Witous, P.C., of Chicago (James T. Ferrini, George D. Gardner, and Tyler J. Lory, of counsel), for appellant.
    Querrey, Harrow, Gulanick & Kennedy, Ltd., of Chicago (Victor J. Piekarski, Susan F. Zwick, and Michael Resis, of counsel), for appellee.
   JUSTICE CAMPBELL

delivered the opinion of the court:

Plaintiff, State Farm Mutual Automobile Insurance Company (State Farm), filed this action for declaratory judgment seeking a determination whether plaintiff owed insurance coverage to defendants, Jeffery and Peter Oss, in connection with an automobile accident in which William Lally, the driver of the other car, was killed. Appellant, National Ben Franklin Insurance Company (National Ben), intervened in the action on behalf of Lally, seeking a declaration that State Farm owed coverage to the Osses. Following a bench trial, the court found no insurance coverage was owed, and judgment was entered in favor of State Farm. National Ben Franklin Insurance Company appeals, claiming error in the trial court’s determination that a 30-day limitation on an agent’s authority to bind insurance coverage was applicable under the facts in this case.

The record discloses that on September 23, 1979, 18-year-old Jeffery Oss, the owner and driver of a 1966 Chevrolet, was involved in an automobile accident in Chicago. Peter Oss, Jeffery’s father, insured two vehicles with State Farm under two separate policies. Jeffery was named as an additional insured on each of those policies. The policies were purchased through Earl Garbutt, who had been a State Farm agent for 23 years. The parties stipulated at trial that the two policies did not cover the 1966 Chevrolet owned by Jeffery.

Jeffery testified that he purchased the 1966 Chevrolet in July 1979 and that he asked his father to secure full insurance coverage for the car. Jeffery added that his father had told him that he had procured the insurance.

Peter Oss testified that he telephoned the Garbutt Agency of State Farm in order to obtain insurance coverage for Jeffery’s car. Peter stated that he spoke to a woman at the agency and that he gave her the information she requested. Peter told the woman that the car belonged to his son and that he wanted the same coverage as he had under his other two policies. Peter also stated that he could not remember the woman’s telling him that he needed to come into the office to obtain coverage, but he was quite sure she told him he would receive an application in the mail. Peter further testified that the woman told him there was “no problem” about the coverage and Peter believed he had obtained the insurance at that time. Peter stated that he did not send the premium deposit for the insurance to the agency because he never received the application.

Earl Garbutt testified that he would accept telephone requests for additional insurance coverage from customers who were already insured with his agency. Garbutt stated that his employee, Debbie Saputa, who answered the phone in his office, was authorized as his representative to provide insurance coverage to repeat customers pursuant to telephone requests. Because Garbutt kept no records of telephone requests for insurance, it was not possible for him to testify as to what Saputa told Peter Oss when he requested the insurance. Instead, Garbutt described the standard telephone procedure for such requests. Garbutt said that Saputa was trained to tell the customers that they had 30 days within which to return the application and pay the premium deposit for the insurance. Garbutt added that Saputa was not to provide insurance over the telephone when he was not in the office.

Debbie Saputa testified that she could not deny or affirm the telephone conversation with Peter Oss. She stated, however, that if requested, she would have quoted a premium and provided insurance coverage to repeat customers over the telephone. Further, because Jeffery was an additional insured on his father’s policies with the agency, she would have treated Jeffery as a repeat customer and provided insurance over the telephone. Saputa said that she would have told a repeat customer that insurance coverage would have been provided for 30 days and that the customer would have to sign an application and pay a premium deposit within those 30 days to finalize the transaction.

The trial court made the following findings of fact: that Garbutt and Saputa could provide insurance coverage for repeat customers over the telephone, but that the customer would be required to sign an application and pay a premium deposit; that Saputa told Peter Oss that there was “no problem” about coverage and that Peter believed he had full coverage; and that Jeffery believed he was insured. Based on these findings the court ruled that “the authority to bind was a limited authority to bind conditioned on the payment of a premium deposit and the receipt of a signed application” and that the authority could not exceed 30 days from the date of the telephonic binder. The court concluded that Peter and Jeffery Oss were not insured by State Farm for the accident of September 23, 1979, but that if the accident had taken place in August 1979, which would have been within the 30-day limitation period, the Osses would have been covered by State Farm. Apparently, the court concluded that any oral contract of insurance was limited to 30 days from the date of the telephone transaction.

National Ben first contends there was an unrestricted oral contract of insurance between State Farm and the Osses. National Ben asserts that the 30-day restriction on the authority to telephonically bind insurance coverage is unenforceable in this case because the restriction was not communicated to the Osses and because State Farm failed to properly process the Osses’ request for insurance and therefore the Osses could not tender the required application. State Farm maintains that it had no contract of insurance with the Osses and that the trial court did not find such a contract in existence. State Farm claims that the Osses failed to introduce sufficient evidence to establish the existence of a contract of insurance and, therefore, the court’s finding in favor of State Farm was proper.

Initially, we must consider whether or not a contract of insurance existed between the Osses and State Farm. To establish a contract of insurance, evidence must be introduced to prove, at a minimum, the requisite elements of the coverage limits, the duration of the coverage and the amount of the premium. (Ross v. Thomas (1977), 45 Ill. App. 3d 705, 360 N.E.2d 126.) Here, in concluding that there were no material contradictions in the testimony which was presented, the trial court apparently accepted the claim that an oral contract of insurance existed between the Osses and State Farm. The evidence supported that conclusion. Peter Oss testified that he telephoned his State Farm agent to obtain insurance for Jeffery’s car and that he told Saputa he wanted "the same [coverage] as on the other cars *** full coverage.” Oss also stated that he believed he was quoted a rate for the insurance but that he could not be positive. Based on this evidence, the trial court may have been convinced that the requisite elements of a contract of insurance were proved. Moreover, the clarification by the court that “had this unfortunate incident occurred during the month of August, *** I believe that Mr. Oss, would, in fact, have been covered by *** [State Farm]” clearly supports the Osses’ claim that there was a contract of insurance between themselves and State Farm.

We now address the question whether or not coverage under the contract of insurance was limited to 30 days from the date of the telephone transaction as was apparently determined by the trial court. National Ben maintains that the 30-day limitation on authority to bind coverage cannot be enforced in this case since the limitation was never disclosed to the Osses. National Ben asserts the general rule that an insurer will not be permitted to deny coverage by claiming that an act of its agent was unauthorized unless the insured was specifically informed of the restriction on the agent’s authority. (Aetna Insurance Co. v. Maguire (1869), 51 Ill. 342; Hartford Fire Insurance Co. v. Farrish (1874), 73 Ill. 166.) National Ben also asserts that State Farm cannot claim that Peter Oss was informed by Saputa of the 30-day limitation solely on the grounds that Saputa was trained to tell customers that the insurance coverage was effective for only 30 days. National Ben cites the general rule in Illinois that "proof of a regularly followed business routine is admissible providing there is some evidence that it was followed in the particular case.” (Goetz v. Country Mutual Insurance Co. (1975), 28 Ill. App. 3d 154, 162, 328 N.E.2d 109, 115.) It is not disputed that such particular evidence is not available in this case.

Finally, National Ben claims that the Osses should not be denied coverage due to State Farm’s failure to properly process the Osses’ request for insurance coverage. National Ben relies on Wille v. Farmers Equitable Insurance Co. (1967), 89 Ill. App. 2d 377, 232 N.E.2d 468, in support of its contention. In Wille, a case which is factually similar to the instant case, the court held that the plaintiff insurer would not be permitted to deny coverage where plaintiff’s general agent failed to properly process a request for insurance which resulted in plaintiff’s failure to receive the application.

After examining the record, we are persuaded by National Ben’s argument that State Farm cannot be permitted to deny coverage to the Osses where the creation of a written contract of insurance was contemplated by the parties, but where, through no fault of the insureds, such a contract was never consummated. Likewise, it is untenable to maintain that the Osses should be denied coverage on the basis of a restriction which was never communicated to them. For these reasons, this case is reversed and remanded for the entry of a judgment finding that State Farm owes insurance coverage to the Osses for the accident of September 23, 1979.

Judgment reversed and remanded with directions.

GOLDBERG and McGLOON, JJ., concur.


author: JUSTICE TRAPP

text:
      In re MARRIAGE OF SUSAN (CAMERON) GRIFFITHS, Petitioner-Appellee, and RICHARD GRIFFITHS, Respondent-Appellant.
    Fourth District
    No. 4—84—0164
    Opinion filed August 28, 1984.

      Richard J. Griffiths, of Menard, for appellant, pro se.

    R. Mark Mifflin, of Giffin, Winning, Lindner, Newkirk, Cohen & Bodewes, P.C., of Springfield, for appellee.
   JUSTICE TRAPP

delivered the opinion of the court:

The parties’ marriage was dissolved in July 1980. On October 17, 1980, custody of the parties’ only child, who was born January 8, 1979, was awarded to the petitioner mother and the court reserved issues of child support and visitation by the respondent father. Respondent was subsequently convicted of the offenses of murder, aggravated arson, and arson, and sentenced to 40 years’ imprisonment for murder and 30 years’ imprisonment for aggravated arson. (People v. Griffiths (1983), 112 Ill. App. 3d 322, 445 N.E.2d 521.) On August 25, 1983, respondent filed a petition for modification of the dissolution of marriage decree to order visitation rights with his son at the Menard Correctional Center, where he was then incarcerated. His petition was heard and denied on December 15, 1983, with a written order entered on February 15, 1984. Respondent appeals from the judgment of the circuit court of Macoupin County. We affirm.

The defendant’s petition for visitation rights requested that his parents, the paternal grandparents, be allowed custody of his son on the first and last Sundays of each month to transport him to the facility where the respondent is incarcerated for purposes of visitation, or for such other relief as the court might find just and proper. The petition stated that there are facilities at Menard to accommodate the visits of young children and that children of four years of age and younger do visit relatives at the facility. The common law record reflects that the respondent appeared pro se at the hearing on his petition. Petitioner appeared with counsel, and evidence was presented by the parties. The petition was denied and the respondent granted the right to reinstate the petition at a later date.

The trial court’s written order denying respondent’s petition for visitation rights referenced the language of section 607(a) of the lilinois Marriage and Dissolution of Marriage Act (Ill. Rev. Stat. 1983, ch. 40, par. 607(a)), which provides in pertinent part: “A parent not granted custody of the child is entitled to reasonable visitation rights unless the court finds, after a hearing, that visitation would endanger seriously the child’s physical, mental, moral or emotional health.” The court stated that respondent’s present incarceration was for his conviction of arson and the murder of the uncle of the parties’ minor child. The court expressly found that to grant the petition and permit visitation between the respondent and Cory Jay Griffiths would endanger seriously the child’s mental or emotional health. The court stated that in making its findings it had taken into consideration all appropriate factors designated by the Illinois Marriage and Dissolution of Marriage Act, together with all other considerations specified in its statements made in open court on December 15, 1983.

On appeal, respondent relies on Frail v. Frail (1977), 54 Ill. App. 3d 1013, 370 N.E.2d 303, wherein the reviewing court affirmed a trial court’s order directing periodic visits between an incarcerated mother and her minor children. Respondent notes that the Frail opinion referred to the fact that the record reflected testimony that physical arrangements could be made at the site of the mother’s incarceration in a nonprison atmosphere. He states that there was similar testimony presented in this cause. He urges that the trial court did not find him unfit to have visitation rights with the minor child and that the court did not state specific reasons for its finding that visitation would endanger seriously the child’s mental or emotional health.

A transcript of proceedings at the hearing on this petition has not been made a part of the record. Neither has the defendant prepared an agreed statement of facts pursuant to Supreme Court Rule 323(d) (87 Ill. 2d R. 323(d)). Ordinarily, a presumption exists that the omitted report of proceedings justifies the order from which the appeal is taken and any incompleteness will be resolved against an appellant. In re Marriage of Brophy (1981), 96 Ill. App. 3d 1108, 421 N.E.2d 1308.

The trial court made the finding of endangerment required by section 607(a) in denying the petition. In this respect, this case is to be distinguished from Griffiths v. Griffiths (1984), 127 Ill. App. 3d 126, wherein the divorce decree granted reasonable visitation and the defendant father sought a modification ordering visitation at the place of his incarceration. That petition was assessed pursuant to the language of section 607(c) of the Act, i.e., the best interests of the child.

Where, as here, the judgment order recites that the court considered all appropriate factors designated by'the Act, and contains the requisite finding of endangerment, a reviewing court must presume that the evidence heard was sufficient to support the judgment absent any contrary indication appearing in the record. (In re Marriage of Brophy (1981), 96 Ill. App. 3d 1008, 421 N.E.2d 1308.) That the place of incarceration has facilities for visits with children in a nonprison atmosphere does not dictate that visitation be granted in all cases.

Affirmed.

GREEN and WEBBER, JJ., concur.


text:
    LINDA JO GRIFFITHS, Plaintiff-Appellee, v. RICHARD J. GRIFFITHS, Defendant-Appellant.
    Fourth District
    No. 4—84—0088
    Opinion filed August 28, 1984.

      Richard J. Griffiths, of Menard, for appellant, pro se.

    Charles J. Speta, of Springfield, for appellee.
   JUSTICE TRAPP

delivered the opinion of the court:

Defendant appeals from the order of the trial court which denied his petition for modification of a decree of dissolution to order visitation rights with his son at the Menard Correctional Center, where defendant is presently incarcerated. The decree of dissolution provided for the right of reasonable visitation.

The parties were divorced on October 28, 1976. Custody of their only child, who was born November 8, 1971, was awarded to plaintiff, with defendant given reasonable rights of visitation. Defendant was subsequently convicted of the offenses of murder, aggravated arson, and arson, and sentenced to 40 years’ imprisonment for murder and 30 years' imprisonment for aggravated arson. People v. Griffiths (1983), 112 Ill. App. 3d 322, 445 N.E.2d 521.

The defendant’s petition for visitation rights requested that his parents, the paternal grandparents, be allowed custody of his son on the first and last Sundays of each month to transport him to the facility where defendant is incarcerated for the purposes of visitation, or “for such other and further relief that may be just and proper.” The petition stated that there are facilities at Menard to accommodate the visits of young children, that children of 12 years of age and younger do visit relatives at Menard, and that his son has been transported by defendant’s mother to Menard on two occasions for visitation purposes. The common law record reflects that the defendant was present in person and with appointed counsel at the hearing on his petition. Plaintiff appeared pro se. Testimony was taken and the trial judge entered the following letter opinion:

“It is the Court’s decision that [defendant’s] petition for an order directing [plaintiff] to allow the grandparents of Jamie Michael Griffiths to take custody of Jamie from 7:00 a.m. until 7:00 p.m. two Sundays per month for the purpose of transporting him to Menard, Illinois, for visitation should be denied.
The facts in this case appear to differ substantially from those in [Frail v. Frail (1977), 54 Ill. App. 3d 1013, 370 N.E.2d 303] relied upon by [defendant]. The court found in Frail that a strong parent-child relationship had been established between the children and their mother. The mother had had custody of the children, ages six and eight, at the time of her divorce in 1974 until she was incarcerated in 1976. She petitioned the Court for visitation rights within seven months after her conviction.
In this case, [the parties] were divorced when Jamie was just short of five years old. [Plaintiff] was given custody of Jamie, and there was not even any provision for [defendant] to pay support for Jamie. The evidence indicates that [defendant] visited with Jamie several times per month in 1977 and 1978, but moved to Phoenix in 1979, and has been in custody since January, 1980.
[Defendant] has apparently seen Jamie twice since January, 1979. According to [plaintiffs] testimony [defendant] never called or wrote to Jamie, sent him birthday presents or cards or wrote him letters to the present date. [Defendant] testified that he has written ‘a couple of letters’ to his son over the past year, but has not telephoned him although [defendant] has telephone privileges.
The only evidence we have as to Jamie’s desire in this matter is that he does not wish to make the trip.
Jamie’s desire is not controlling on the Court; his wishes concerning the matter are certainly relevant, however, in determining whether such a bond exists between father and son as to render it in the best interest of the minor to be transported from Springfield to Menard twice a month. The evidence does not indicate that any such bond exists here.”

The court thereupon denied defendant’s petition.

Section 607 of the Illinois Marriage and Dissolution of Marriage Act, effective October 1, 1977, (Ill. Rev. Stat. 1983, ch. 40, par. 607) states a strong public policy designed to preserve the relationship of parent and child, using the language:

“(a) A parent not granted custody of the child is entitled to reasonable visitation rights unless the court finds, after a hearing, that visitation would endanger seriously the child’s physical, mental, moral or emotional health.” (Emphasis added.)

Prior to the adoption of the Act, our courts had recognized a public policy substantially comparable in strength without, however, fixing the legislative standards that when considering modifications of the manner of visitation the test was to be the “best interests of the child,” as distinguished from those instances where visitation was totally denied, or obviously restricted when the legislative standard became the endangerment of the child’s welfare.

The courts have interpreted the stated legislative policy as it has been explicated in the Historical and Practice Notes of section 607 that there be a healthy and close relationship between parent and child and “that visitation privileges should not be awarded or withheld as a punishment or reward to either parent” (Ill. Ann. Stat., ch. 40, par. 607, Historical and Practice Notes, at 70 (Smith-Hurd 1980)). While decided under the law effective prior to the date of the Act, in Frail v. Frail (1977), 54 Ill. App. 3d 1013, 370 N.E.2d 303, the court, using the standard of the “best interests of the children,” determined that the trial court did not abuse its discretion in directing that the children be permitted to visit their mother following a conviction of murder. There, the record shows a strong relationship between the mother and children and assumed visiting conditions which would not alarm or oppress the children. In effect, the court held that imprisonment of a parent does not, of itself, require that visitation between child and parent be barred or restricted. Such view has been expressly stated in courts of neighboring States. (Casper v. Casper (1977), 198 Neb. 615, 254 N.W.2d 407; McCurdy v. McCurdy (1977), 173 Ind. App. 437, 363 N.E.2d 1298.) On the other hand, we are not persuaded that the parent’s imprisonment creates a per se right to visitation at a prison or at a particular place chosen solely by the noncustodial parent.

In 1971, the father was awarded the right of reasonable visitation in the customary manner and contemplation of the usual decree concerning child custody. The exercise of that right by the father is interrupted or limited through circumstances which are not under the control of either the custodial parent or the court. The father is the one seeking the change or deviation in the manner of visitation contemplated at the time of entering the decree concerning custody, and it is the father who effectively is asking affirmative relief.

The Illinois courts have held that where the proceeding is by a custodial parent to restrict or deny the visitation, the burden is upon the custodial parent to prove by a preponderance that the visitation then provided endangers the welfare of the children. (In re Marriage of Neat (1981), 101 Ill. App. 3d 1046, 428 N.E.2d 1093.) However, where the noncustodial parent seeks to modify visitation rights which have been originally granted in the dissolution decree, the burden of proof is upon such parent to show that the modification is in the “best interest” of the child or children. Coons v. Wilder (1981), 93 Ill. App. 3d 127, 416 N.E.2d 785.

No transcript of the January 23 hearing has been made part of the record on appeal; it appears from the common law record that the trial judge denied defendant’s request for a free transcript, which request was based upon his indigency. Neither has the defendant nor his trial counsel presented an agreed statement of facts pursuant to Supreme Court Rule 323(d) (87 Ill. 2d R. 323(d)). It is generally held that it is the burden of the appellant to present a record sufficiently complete to permit review of the error complained of, and doubts arising from the presentation of the record will be resolved against the appellant. Issues of the sufficiency of the evidence cannot be reviewed in the absence of a report of proceedings, and in the absence of a contrary indication in the record, the trial court is presumed to act correctly. Rosenblatt v. Michigan Avenue National Bank (1979), 70 Ill. App. 3d 1039, 1042, 389 N.E.2d 182, 185.

As it appears that the trial court applied the best-interests-of-the-child standard, as required by section 607(c) of the statute, in ruling against the defendant father’s petition for visitation at the place of his incarceration, we find no basis for reversal. We therefore decline to substitute our judgment of reasonable visitation for that of the trial court.

In reaching this result we have considered the decisions of our sister jurisdictions relating to post-dissolution visitation for noncustodial parents in imprisonment. See Chadwick v. Chadwick (1936), 275 Mich. 226, 266 N.W. 331; M.L.B. v. W.R.B. (Mo. App. 1970), 457 S.W.2d 465; Casper v. Casper (1977), 198 Neb. 615, 254 N.W.2d 407; Caynor v. Caynor (1982), 213 Neb. 143, 327 N.W.2d 633; McCurdy v. McCurdy (1977), 173 Ind. App. 437, 363 N.E.2d 1298; and Garcia v. Garcia (Ind. 1981), 425 N.E.2d 220.

Affirmed.

GREEN and WEBBER, JJ., concur.