Herlehy v. Marie v. Bistersky Trust Dated May 5, 1989

SIXTH DIVISION
DECEMBER 23, 2010
Nos. 1-09-0038; 1-09-1892; 1-09-3295;
1-09-3431; 1-10-0070; 1-10-0071 (cons.)
TIMOTHY HERLEHY and ) Appeal from the
MICHAEL HERLEHY, ) Circuit Court of
) Cook County.
Plaintiffs-Appellants, )
)
v. )
)
MARIE V. BISTERSKY TRUST DATED )
MAY 5, 1989, and ATG TRUST COMPANY, )
as Trustee, THE ALZHEIMERS DISEASE ) No. 05 CH 15199
AND RELATED DISORDERS ASSOCIATION, )
AMERICAN HEART ASSOCIATION, THE )
RESPIRATORY HEALTH ASSOCIATION OF )
METROPOLITAN CHICAGO (f/k/a The American )
Lung Association of Metropolitan Chicago), CATHOLIC )
CHARITIES OF THE ARCHDIOCESE OF CHICAGO, )
AMERICAN CANCER SOCIETY – ILLINOIS ) Honorable
DIVISION, THE ILLINOIS ATTORNEY GENERAL ) Kathleen M. Pantle,
and FIRST NATIONAL BANK OF LAGRANGE, ) Judge Presiding.
)
Defendants-Appellees. )
JUSTICE ROBERT E. GORDON delivered the judgment of the court, with opinion.
Justices Cahill and McBride concurred in the judgment and opinion.
OPINION
These consolidated appeals arise from an action for construction of a trust agreement,
breach of a fiduciary duty by a trustee, First National Bank of LaGrange (LaGrange Bank), and a
claim of unjust enrichment on behalf of the trust agreement’s residuary beneficiaries, the
Alzheimer’s Disease and Related Disorders Association, the American Heart Association, the
Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
Respiratory Health Association of Metropolitan Chicago,1 Catholic Charities of the Archdiocese
of Chicago, and American Cancer Society (collectively, the Charities).
Plaintiffs Timothy Herlehy (Timothy) and Michael Herlehy (Michael) filed a second
amended complaint alleging that their deceased great-aunt, Marie V. Bistersky (Marie), intended
to amend her trust before her death leaving them with a larger share of her trust assets. Plaintiffs
allege that LaGrange Bank breached its fiduciary duty by failing to amend Marie’s trust agreement
pursuant to her directions and, as a result, the Charities will be unjustly enriched to plaintiffs’
detriment.
The trial court granted LaGrange Bank’s motion to dismiss with prejudice pursuant to
section 2-619(a)(9) of the Illinois Code of Civil Procedure (Code) (735 ILCS 5/2-619(a)(9)
(West 2006)), finding that LaGrange Bank had no duty to amend Marie’s trust. The trial court
also granted the Charities’ motion for summary judgment pursuant to section 2-1005 of the Code
(735 ILCS 5/2-1005 (West 2006)), and denied plaintiffs’ cross-motion for summary judgment,
finding that there was no valid amendment to Marie’s trust and, as a result, the Charities were
entitled to their equal portions in the trust’s residuary assets. The trial court further denied
plaintiffs’ motion for reimbursement of attorney fees and found that it lacked jurisdiction over
LaGrange Bank’s motion for reimbursement for its attorney fees.
In this consolidated appeal, plaintiffs appeal claiming the trial court erred in: (1) granting
1
The Respiratory Health Association of Metropolitan Chicago is frequently known as the
American Lung Association of Metropolitan Chicago.
2
Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
LaGrange Bank’s motion to dismiss; (2) granting the Charities motion for summary judgment; and
(3) denying their motion for reimbursement for its attorney fees. LaGrange Bank also appeals
claiming that the trial court erred in finding that it lacked jurisdiction to consider LaGrange
Bank’s motion for reimbursement of its attorney fees. We affirm.
BACKGROUND
Timothy originally filed a verified “Complaint for Construction of the Marie V. Bistersky
Trust” (original complaint) and alleged as follows: On May 5, 1989, Marie established a written
trust agreement, identifying herself as settlor and First Illinois Bank of LaGrange as trustee.
Marie’s husband predeceased her and she did not have or adopt any children.
Marie amended her trust agreement six times within 10 years. In each amendment, Marie
amended the specific beneficiaries and the amount of money they were to receive. She also
amended the names of the charities that would receive the residue of the trust. Marie filed her
sixth amendment on December 9, 1999, with Bank One Trust Company, NA (Bank One), which
was the successor trustee at that time. That amendment provided, in pertinent part, as follows:
“THIRD
SECTION 1: Upon the death of the settlor the trustee shall
distribute the trust estate as follows:
(a) Five Thousand Dollars ($5,000.00) to RHONDA
BALLA ***;
(b) Fifteen Thousand Dollars ($15,000.00) to
VICTORIA WANDOLEWSKI ***;
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Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
(c) Fifteen Thousand Dollars ($15,000.00) to BONNIE
STOLARCZYK ***;
(d) Twenty Thousand Dollars ($20,000.00) to
RICHARD BOGACZ ***;
(e) Twenty Thousand Dollars ($20,000.00) to JOSEPH
BOGACZ ***;
(f) Two Hundred Thousand Dollars ($200,000.00) to
the settlor’s grandnephew, TIMOTHY J. HERLEHY ***;
(g) Two Hundred Thousand Dollars ($200,000.00) to
the settlor’s grandnephew, MICHAEL HERLEHY ***;
(h) The balance of the trust estate shall be distributed in
equal shares to the following five (5) charities:
1) ALZHEIMER’S DISEASE AND
RELATED DISORDERS ASSOCIATION ***;
2) AMERICAN HEART
ASSOCIATION ***;
3) THE AMERICAN LUNG
ASSOCIATION OF METROPOLITAN CHICAGO
***;
4) CATHOLIC CHARITIES OF THE
ARCHDIOCESE OF CHICAGO ***;
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Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
5) AMERICAN CANCER SOCIETY
***.”
In formulating an amendment to the trust, the trust agreement provided as follows:
“SEVENTH: The settlor may at any time or times amend or
revoke this agreement in whole or in part by [an] instrument in writing
(other than a will) delivered to the trustee. ”
In a discovery deposition, Timothy testified that Rhonda Balla was Marie’s grand-niece
and Richard and Joseph Bogacz were Marie’s nephews. He further testified that Victoria
Wandolewski was a close friend of Marie, and Bonnie Stolarczyk was Marie’s friend and
accountant.
In 2001, Marie was 89 years old and moved to an assisted living facility in LaGrange.
Timothy testified that he had a close relationship with Marie, assisted her in relocating to the
assisted living facility and with daily tasks and drove her to her doctor’s office. Timothy had a
master’s degree in finance, and at Marie’s request, he reviewed the allocation of her trust assets,
and Marie granted him power of attorney to manage her health care needs.
He testified that following her move to the assisted living facility, Marie told him that she
did not believe that her trust reflected her wishes and that Bank One’s trust officer, Patrice Grant,
was not acting in her best interests. Timothy discovered that 90% of Marie’s trust assets were
invested in stock and told a manager of Bank One’s trust department that such a high stock
allocation was too risky for a settlor of Marie’s age. Timothy also discovered that due to
favorable stock market conditions during the 1990s, Marie’s trust investments had increased in
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Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
value to $1,800,000.2 He further discovered that due to unfavorable market conditions in the
years of 2000 and 2001, the value of the stock decreased in value to approximately $1,200,000.
by mid-2001. Timothy testified that Marie was not aware of the value fluctuation in her trust’s
investments.
Timothy testified that in August of 2001, he and Michael each received a $100,000 gift
from Marie. At that time, Marie had also executed an “amendment to the restatement” of the trust
with the assistance of Charles Jardine, who had been her attorney since she first executed her trust
agreement. The amendment reduced the gifts to Timothy and Michael in Marie’s trust from
$200,000 to $100,000 each.
Additional changes to specific bequests in the amendment included replacing Rhonda Balla
with Carmon Keith, who was Marie’s “caretaker.” Marie signed and delivered the amendment on
August 9, 2001, to Bank One.
Timothy testified that Marie continued to express her dissatisfaction with Bank One as her
trustee and expressed dissatisfaction with Jardine as her attorney, and told Timothy that she
desired to replace them both. She asked Timothy to help her transfer her trust from Bank One to
LaGrange Bank, which had been chosen for its proximity to Marie’s assisted living facility.
Timothy testified that he contacted William Boylan, an attorney he knew, for his assistance in
formulating the transfer.
Boylan testified in a discovery deposition that he met with Marie to discuss her trust.
2
Nothing in the record details Marie’s original trust investment value.
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Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
Boylan testified that he had examined Marie’s trust agreement and informed her that because her
assets had grown in value in the previous years, the majority of her trust assets would be
distributed through the residuary clause to the Charities. Boylan testified that Marie told him that
such a result was not her intent; that she wanted only a “leftover” portion of the trust assets to
pass to the Charities and the stock investments to “go to Tim.” Boylan also informed Timothy
that the majority of Marie’s trust assets would be distributed through the residuary clause to the
Charities and Marie again expressed to Boylan, in Timothy’s presence, that the trust agreement
did not reflect her intent.
Christopher Joyce, an executive vice president and trust officer of LaGrange Bank,
testified in a discovery deposition that he met with Marie and Timothy on January 10, 2002. At
that meeting, Joyce testified that Marie explained to him that she wanted the stock investments be
distributed to Timothy. He also testified that Timothy informed him that Boylan would be
drafting an amendment to Marie’s trust to transfer the trust from Bank One to LaGrange Bank.
Joyce and Boylan both testified in their discovery depositions that they formulated a plan
of action, with Marie’s oral approval, whereby they would first remove Bank One as trustee,
appoint LaGrange Bank as successor trustee and initiate the transfer of Marie’s trust assets to
LaGrange Bank. Second, they would discuss with Marie her concerns regarding her trust
agreement and her investments. Third, they agreed that after all the assets were transferred to
LaGrange Bank, any amendments to Marie’s trust agreement would then be drafted to reflect her
intentions.
Joyce testified that in February he received a document entitled “second amendment to the
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Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
restatement” (second amendment) to Marie’s trust agreement from Boylan. In addition to
appointing LaGrange Bank as successor trustee, the second amendment also provided that, after
Marie’s death and prior to full and final distribution of the trust’s assets, any acting trustee could
be removed by Timothy. The second amendment was dated February 11, 2002, and signed by
Marie. Joyce signed the second amendment on behalf of LaGrange Bank accepting appointment
as successor trustee.
Joyce testified LaGrange Bank received Marie’s trust assets from Bank One at the end of
March 2002 and that the delay in transferring the trust assets was caused by Bank One. Joyce
further testified that LaGrange received the remaining nonstock assets from Bank One in July of
2002, which included an insurance policy and “EE” bonds.
Joyce further testified that LaGrange hired Feldman Securities Group, an investment
advisory firm, to perform an analysis of Marie’s trust assets and present its recommendation for
reallocating her investments. On May 13, 2002, the vice president of Feldman Securities Group,
Brian McNamara, stated in an affidavit that he sent LaGrange an investment recommendation
form (Feldman investment form) that he prepared concerning Marie’s trust assets. McNamara
further stated in his affidavit that he received Marie’s investment information and placed his
recommendations in the Feldman investment form, although he never met with Marie. He further
stated that he was not an attorney and was not asked to prepare a trust amendment for Marie.
McNamara also testified in a discovery deposition that Feldman Securities does not prepare trust
amendments. The following day, Joyce brought the completed Feldman investment form to Marie
for her review, and Marie signed and approved the form.
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Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
The Feldman investment form listed the amount of cash, bonds, and stocks that Marie had
invested in her trust. It also listed McNamara’s proposed reallocation of those investments. The
Feldman investment form further included a “comments” section which stated: “We understand
this trust is for the benefit of [Marie]. These assets will eventually go to her nephews.” Stamped
on the investment recommendation form was the word “Approved” with Marie’s signature
underneath.
Attorney Boylan testified that he received no further contact from Marie, Joyce or
Timothy to draft any further amendments to Marie’s trust agreement. On August 19, 2002, Marie
died.
According to the original complaint, the value of the investments in her trust was
approximately $1,250,000 at the time of her death. Approximately $300,000 were disbursed in
accordance to the specific bequests contained in the trust agreement. The residue of the trust is
approximately $950,000.
In September 2002, Timothy discovered a handwritten note in a phone book located in
Marie’s night table next to her bed. The handwritten noted was undated and unsigned and listed
the following:
“Tim Herlehy Stock
Michael Herlehy 200,000
Rich Bugacz 15,000
J Bugacz 5,000
Vicki 20,000
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Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
Bonnie 15,000
Carmen 5,000”
In October 2002, pursuant to his power enumerated in the trust agreement, Timothy
replaced LaGrange Bank as trustee and appointed Guaranty Trust Company as successor trustee.
Guaranty Trust was later renamed as ATG Trust Company.
Procedural History
On September 7, 2005, Timothy filed his original complaint against ATG Trust Company,
the Charities, and the Illinois Attorney General. Count I was a cause of action for trust
construction and count II for unjust enrichment against the Charities. Timothy alleged that Boylan
acted as Marie’s attorney and LaGrange Bank acted as her trustee. Timothy further alleged that
Boylan was aware of the changes she sought to make to her trust agreement so that only a
relatively small portion would pass through the residuary clause to the Charities.
On November 2, 2006, Timothy filed a verified three-count amended complaint (first
amended complaint) adding his brother Michael as a plaintiff and LaGrange Bank as an additional
defendant. The first amended complaint included nearly identical allegations as the original
complaint; however, plaintiffs also alleged that Marie’s written instructions to LaGrange Bank
were signed and delivered to LaGrange Bank and accepted in writing through the Feldman
investment form. Plaintiffs alleged that if the valid amendment was not effectuated, the failure
was caused by LaGrange Bank’s breach of its fiduciary duty to act upon Marie’s written
instructions.
On July 10, 2007, LaGrange Bank filed a motion to dismiss pursuant to sections 2-
10
Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
619(a)(9) and 2-615 of the Code claiming that: (1) it was released from any liability when
Timothy signed a release upon removing LaGrange Bank as trustee; and (2) LaGrange Bank
legally could not draft an amendment to the trust agreement for Marie under the Illinois
Corporation Practice of Law Prohibition Act (Act) (705 ILCS 220/0.01 et seq. (West 2006)),
which prohibited it from drafting amendments to trust agreements.
On November 26, 2007, plaintiffs filed a response arguing that their first amended
complaint is not based on an allegation that LaGrange Bank was required to draft legal
documents, but that it breached its fiduciary duty by failing “to ensure [that] a valid amendment to
the trust was effectuated.”
On January 18, 2008, the trial court entered a written order granting LaGrange Bank’s
motion to dismiss without prejudice. In the written order, the trial court agreed with LaGrange
Bank that pursuant to the Act, LaGrange Bank could not draft legal documents, such as an
amendment to a trust agreement, as LaGrange Bank is a corporation prohibited from practicing
law. The trial court also found that it was Boylan’s duty as Marie’s attorney for estate planning
to draft any amendments to Marie’s trust and that, under the Illinois Rules of Professional
Conduct, Boylan was prohibited from receiving directions from LaGrange to draft amendments to
Marie’s trust agreement. Any amendments had to be directed by the settlor, who was Marie. The
trial court then granted plaintiffs leave to file a second amended complaint.
On February 15, 2008, plaintiffs filed a verified second amended complaint. The verified
second amended complaint included nearly identical allegations as the original complaint;
however, plaintiffs alleged that Marie hired Boylan to undertake only the drafting of the
11
Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
amendment to appoint LaGrange Bank as trustee. Plaintiffs further alleged that Boylan was not
employed by Marie or contacted by LaGrange Bank to draft an amendment or meet with Marie in
May 2002, it was LaGrange Bank’s failure to contact an attorney to prepare the amendment to
the trust which resulted in the failure to amend Marie’s trust agreement as she requested.
Specifically, plaintiffs alleged that Marie stated to Joyce that it was her wish that all of her stocks
be bequeathed to Timothy and that Joyce replied on “at least two occasions” to Marie and
Timothy as follows:
“that her directives to bequeath or gift all her stock to Timothy *** would be
accomplished as she intended and that no further steps would be necessary on her
part. [Joyce] assured he would coordinate professionals including contacting
attorneys or investment advisors as needed on her behalf and bring any required
documents to her residence for signature.”
On March 14, 2008, LaGrange Bank again filed its motion to dismiss pursuant to sections
2-619(a)(9) and 2-615 of the Code. LaGrange Bank again argued that it had no duty to draft
amendments to Marie’s trust agreement or retain an attorney to make such amendments.
According to LaGrange Bank’s reply, plaintiffs’ filed a response on April 14, 2008, but that
response is not included in the record.
On June 17, 2008, the trial court entered a written order granting LaGrange Bank’s
motion to dismiss, with prejudice. The trial court found the following inconsistencies between
plaintiffs’ verified first amended complaint and their verified second amended complaint: In the
verified first amended complaint, plaintiffs allege that Boylan acted as her new attorney and she
12
Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
directed LaGrange Bank and Boylan to initiate whatever changes necessary to her trust and estate
plan to avoid a windfall to the residuary beneficiaries. Whereas, in the verified second amended
complaint, plaintiffs allege that Marie employed Boylan as her attorney to only undertake the
drafting of an amendment to change LaGrange Bank to the successor trustee.
Further, in the verified first amended complaint, plaintiffs allege that Boylan’s actions were
far broader in scope and that he: (a) corresponded with Bank One to inform it of its removal as
trustee; (b) assured Marie and Timothy that the stocks would be conveyed to Timothy without
any need to act further; (c) would undertake, with LaGrange Bank, the transfer of the assets or
prepare further amendments to the trust as needed to effectuate Marie’s intent; and (d) advised
Marie that additional amendments would not be implemented until the Trust assets had been
transferred from Bank One. Whereas, in the verified second amended complaint, plaintiffs allege
that Boylan was not employed by decedent or contacted by LaGrange Bank to draft an
amendment or meet with Marie in May 2002; and it was LaGrange Bank’s failure to contact an
attorney which resulted in the trust agreement not being amended to reflect Marie’s intent.
The trial court found that because the first amended complaint was verified, the allegations
became judicial admissions and any inconsistent allegations in the second amended complaint
would be ignored. As a result, the trial court concluded that plaintiffs’ allegations in the second
amended complaint against LaGrange Bank mirrored the first amended complaint. The trial court
again found that LaGrange Bank had no duty to advise Marie to make amendments to her trust
and owed no duty to hire an attorney to verify that the trust provisions conformed with Marie’s
intent. Moreover, the trial court found that even if LaGrange Bank voluntarily assumed a duty to
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Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
appoint an attorney for Marie, it was not the failure to make the appointment that caused the
damage, but the failure to amend the trust. The trial court then granted LaGrange Bank’s motion
to dismiss with prejudice.
On November 20, 2008, the Charities filed a motion for summary judgment pursuant to
section 2-1005 of the Code (735 ILCS 5/2-1005 (West 2006)) of the Illinois Code of Civil
Procedure and submitted a supporting memorandum. The Charities claimed that: (1) the Feldman
investment form is not a valid amendment to Marie’s trust as a matter of law; (2) the handwritten
note was not a valid amendment to Marie’s trust as a matter of law; (3) the language contained in
the trust is clear and unambiguous; and (4) the Charities will not be unjustly enriched because the
trust grants to them assets not bequeathed to plaintiffs or other individuals.
On November 24, 2008, LaGrange Bank filed a motion to add language that would
include an Illinois Supreme Court Rule 304(a) (eff. Jan. 1, 1989) finding “that there is no just
reason for delaying either enforcement or appeal or both” of the trial court’s June 17, 2008 order
granting LaGrange Bank’s motion to dismiss with prejudice. On December 2, 2008, the trial court
granted the motion.
On February 13, 2009, plaintiffs filed a response and a cross-motion for summary
judgment against the Charities claiming: (1) the Feldman investment form was a valid amendment
to the trust; (2) the handwritten note found in Marie’s night table after her death also constituted
a valid amendment to the trust; (3) the term “balance” as used in the trust is ambiguous; and (4)
the distribution of the remaining assets of the Marie’s trust to the Charities would result in the
unjust enrichment for the Charities at plaintiffs’ expense. Plaintiffs argued that (1) and (2) above
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Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
comply with the amendment provision in the trust that states: “[t]he settlor may at any time or
times amend or revoke this agreement in whole or in part by [an] instrument in writing (other than
a will) delivered to the trustee.”
On July 7, 2009, after a hearing on the motions, the trial court entered a written order
granting the Charities’ motion for summary judgment and denying plaintiffs’ cross-motion for
summary judgment. The trial court found that the Feldman investment form was not a valid
amendment to Marie’s trust because McNamara, who drafted the Feldman investment form was
not a lawyer and thus if he had drafted an amendment to Marie’s trust his actions would be in
violation of section 2BB of the Consumer Fraud and Deceptive Business Practices Act (Consumer
Fraud Act) (815 ILCS 505/2BB (West 2006)). Moreover, the trial court found that McNamara
could not have acted as a “scrivener”3 to document Marie’s amendment to the trust agreement,
because he never spoke with her; he received instructions and information about the investments
only from Joyce and never intended to prepare an amendment to Marie’s trust, but rather, an
analysis of her investments at the request of LaGrange Bank.
The trial court further found that plaintiffs’ claim of unjust enrichment did not apply
because there was no evidence that plaintiffs were third party beneficiaries to an agreement
between Marie and LaGrange Bank. The trial court concluded that Marie’s trust “unambiguously
3
A “scrivener” is defined as “[a] writer; esp., a professional drafter of contracts or other
documents.” Black’s Law Dictionary 1466 (9th ed. 2009).
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Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
entitles the Charities to its residuary, and found that the Charities have the superior right to the
assets of [Marie’s] Trust.” As a result, the trial court granted the Charities’ motion for summary
judgment and denied plaintiffs’ cross-motion for summary judgment.
On July 22, 2009, LaGrange Bank filed a motion for reimbursement of its attorney fees
claiming it is entitled to attorney fees pursuant to document entitled “Receipt and Approval of
Administration” of Marie’s trust, which was signed by Timothy and delivered to LaGrange Bank.
The document provided that Timothy released and discharged LaGrange Bank from “any
expenses or costs (including legal or other professional fees) in connection with” Marie’s trust
after October 31, 2002. In addition, LaGrange Bank claims it is entitled to attorney fees under
common law because a trustee that is not at fault is entitled to be reimbursed for all of its
expenses properly incurred in administering the trust, citing Kerner v. Peterson, 368 Ill. 59, 81
(1937); Patterson v. Northern Trust Co., 286 Ill. 564, 567 (1919) and Continental Illinois
National Bank & Trust Co. of Chicago v. Sax, 199 Ill. App. 3d 685, 696 (1990). Further,
LaGrange Bank claims “reimbursement” includes legal fees and expenses incurred by a trustee in
defending actions brought by the beneficiaries alleging wrongdoing upon a finding exonerating the
trustee, citing First Midwest Bank/Joliet v. Dempsey, 157 Ill. App. 3d 307, 316 (1987).
On August 12, 2009, plaintiffs filed a motion for reimbursement of its attorney fees and
costs. Plaintiffs are claiming that attorneys who represent parties having an interest in the
construction of a trust agreement are entitled to reasonable fees from the trust estate. Orme v.
Northern Trust Co., 25 Ill. 2d 151 (1962). However, fees are allowable from the trust estate if an
ambiguity exists, which is often defined as “an honest difference of opinion as to the proper
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Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
construction” of the testamentary agreement or ambiguity. In re Estate of Reeve, 393 Ill. 272, 294
(1946); Northern Trust Co. v. Winona Lake School of Theology, 61 Ill. App. 3d 966 (1978).
Plaintiffs claim that a judicial construction of Marie’s trust was required and that there was an
honest difference concerning that construction; therefore, reimbursement of their attorney fees is
proper.
On November 4, 2009, after a hearing on the LaGrange Bank’s motion for attorney fees,
the trial court entered a written order denying LaGrange Bank’s motion for attorney fees for lack
of jurisdiction. The trial court found that LaGrange Bank’s claim for attorney fees was created
when the trial court granted LaGrange Bank’s motion to dismiss on June 17, 2008. LaGrange
Bank then requested the trial court to include Rule 304(a) language in its decision, which the trial
court included on November 24, 2008. LaGrange Bank’s motion for attorney fees was not filed
until six months after plaintiffs filed their notice of appeal. The trial court concluded that
LaGrange Bank’s motion for attorney fees was not filed within 30 days of the entry of the final
order, and as a result, it had lost jurisdiction.
On December 10, 2009, the trial court entered a written order denying plaintiffs’ motion
for attorney fees. The trial court found that no construction of Marie’s trust was necessary to
determine that the Feldman investment form was not an amendment to the trust and thus,
plaintiffs were responsible for their own attorney fees and costs.
ANALYSIS
In this consolidated appeal, plaintiffs claim that the trial court erred in: (1) granting
LaGrange Bank’s motion to dismiss; (2) granting the Charities’ motion for summary judgment;
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Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
and (3) denying their motion for reimbursement for its attorney fees. LaGrange Bank claims that
the trial court erred in finding that it lacked jurisdiction to consider LaGrange Bank’s motion for
reimbursement of its attorney fees.
Cross-Motions for Summary Judgment
First, plaintiffs claim that the trial court erred in granting summary judgment in favor of
the Charities and denying their cross motion for summary judgment. Specifically, plaintiffs claim
that the trial court erred in finding that the Feldman investment form was not a valid amendment
to Marie’s trust because it was drafted by a nonlawyer in violation of section 2BB of the
Consumer Fraud Act.
A trial court is permitted to grant summary judgment only “if the pleadings, depositions,
and admissions on file, together with the affidavits, if any, show that there is no genuine issue as
to any material fact and that the moving party is entitled to a judgment as a matter of law.” 735
ILCS 5/2-1005(c) (West 2006). The grant or denial of a summary judgment motion is reviewed
under a de novo standard. Hernandez v. Alexian Brothers Health Systems, 384 Ill. App. 3d 510,
519 (2008). In addition, a trial court’s construction of a trust instrument is also reviewed under a
de novo standard. Altenheim German Home v. Bank of America, N.A., 376 Ill. App. 3d 26, 32
(2007).
In granting the Charities’ motion for summary judgment and denying plaintiffs’ cross-
motion for summary judgment, the trial court found that section 2BB of the Consumer Fraud Act
applied. 815 ILCS 505/2BB (West 2008). Section 2BB provides, in pertinent part, as follows:
“The assembly, drafting, execution, and funding of a living trust document or any
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Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
of those acts by a corporation or a nonlawyer is an unlawful practice within the
meaning of this Act. ***
This Section shall not apply to any State or national bank, State or federal
savings and loan association, savings bank, trust company, or any other
corporation that has received a certificate of authority authorizing the exercise of
trust powers under the Illinois Corporate Fiduciary Act.” 815 ILCS 505/2BB
(West 2008).
In its written order, the trial court determined that, under section 2BB, a trust agreement
that is prepared by a person who is not an attorney is unlawful and thus, void. Applying section
2BB to the facts of the case, the trial court concluded that the Feldman investment form that
plaintiffs’ claim constitutes an amendment to Marie’s trust agreement was drafted by McNamara,
and it is undisputed that McNamara is not an attorney.
Plaintiffs claim that section 2BB is not applicable to this case because LaGrange Bank
presented Marie with the Feldman investment form and LaGrange Bank is exempt because section
2BB “shall not apply to any State or national bank ***[or] trust company.” 815 ILCS 505/2BB
(West 2008).
We find nothing in the transcripts of the legislative debates that would support plaintiffs’
contention that an otherwise void trust amendment under section 2BB would become a valid trust
amendment because a bank or trust company presented the amendment to its client, as in this case
when LaGrange Bank gave Marie the Feldman investment form. House Bill 2163 was proposed
because members of the Senate committee were concerned with organizations selling living trust
19
Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
documents to consumers without regulation. 88th Ill. Gen. Assem., Senate Proceedings, May 19,
1993, at 105. Senate Amendment No. 1 to House Bill 2163 was adopted to clarify that the bill is
not directed at the day-to-day activities of financial institutions and trust companies, which are
closely supervised by government regulators. 88th Ill. Gen. Assem., Senate Proceedings, May 19,
1993, at 106.
Based on the legislative history, we also find plaintiffs’ argument that applying section
2BB to banks and trust companies would create an undue burden on settlors to determine
whether a trust document received from a bank or trust company was prepared by an authorized
person not persuasive. The amendment to the bill was not to affect the daily activities of those
financial institutions, and Joyce testified that LaGrange Bank did not draft trust documents on
behalf of its clients and did not retain an attorney to do so. See 705 ILCS 220/0.01 (West 2008)
(prohibiting corporations from practicing law, directly or indirectly).
Plaintiffs further claim that section 2BB is not applicable to this case because it is a
criminal statute which requires intent and there is no evidence of criminal intent in the preparation
and execution of the Feldman investment form. We also find this argument not persuasive. Trust
agreements are construed in the same manner as contracts and subject to the same limitation that
they will not be enforced if contrary to public policy. See In re Estate of Mendelson, 298 Ill.
App. 3d 1, 3 (1998). A contract that violates a valid statute is void. Kim v. Citigroup, Inc., 368
Ill. App. 3d 298 (2006).
The trial court also relied on Landheer v. Landheer, 383 Ill. App. 3d 317 (2008), a
decision from the Third District of the Illinois Appellate Court, in granting summary judgment in
20
Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
the Charities’ favor and against plaintiffs. We find Landheer instructive in our analysis here. In
Landheer, an ailing father asked one of his three sons to draft a document to amend his trust
agreement. Defendant son testified that he spoke with his father and took notes on what his father
wanted amended in the trust agreement. Defendant further testified that he “did not wait for [his
father’s] attorney” because his father had asked him to draft the document “right away” as he was
concerned about his failing health. In drafting the document, defendant decided what language to
use and even added some details of his own. A “short time” after discussing the matter, defendant
brought the document to his father’s home for his father to review and sign. Landheer, 383 Ill.
App. 3d at 319-20.
Defendant’s brother, one of the plaintiffs, was present at the father’s house along with a
third party. The father told defendant that the document “was what he wanted.” The father then
signed the document and defendant’s brother and the third party signed the document as
witnesses. A few days later defendant took the document to the father’s attorney. The father died
approximately a week later. Landheer, 383 Ill. App. 3d at 320.
Defendant’s two brothers brought a suit to have a trial court enter a declaratory judgment
that the disputed document drafted by defendant was not an effective amendment to their father’s
trust. Defendant filed a counterclaim to the contrary. Plaintiffs filed a motion to dismiss
defendant’s counterclaim pursuant to section 2-619 of the Code, asserting that the disputed
document is void because it was prepared by a person who is not an attorney in violation of
section 2BB of the Consumer Fraud Act. The trial court granted plaintiffs’ motion and defendant
appealed. Landheer, 383 Ill. App. 3d at 319-20.
21
Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
The appellate court found that the statutory language of section 2BB of the Consumer
Fraud Act was clear and unambiguous and that it “expressly prohibits the assembly, drafting,
execution, and funding of a living trust document by a nonlawyer” including a document that
“amends a living trust for another person.” Landheer, 383 Ill. App. 3d at 320. Given the clear
language of the statute, the court concluded that the document drafted by the defendant violated
section 2BB of the Consumer Fraud Act and did not constitute a valid amendment to his father’s
trust agreement because defendant was not a lawyer. Landheer, 383 Ill. App. 3d at 320.
Here, as in Landheer, the Feldman investment form, which plaintiffs’ claim constitutes an
amendment to Marie’s trust agreement, was drafted by a nonlawyer, McNamara, in violation of
section 2BB of the Consumer Fraud Act. Based on the reasoning in Landheer, the Feldman
investment form is not a valid trust amendment.
Plaintiffs claim that Landheer is distinguishable because the defendant who drafted the
alleged amendment in Landheer would benefit if the amendment was determined to be valid,
whereas Joyce and McNamara would receive no benefit if the amendment was determined to be
valid. However, plaintiff does not show, and we cannot find, any reference in the Landheer
decision where the court even considered the concept of benefit in its holding that section 2BB
expressly prohibits a nonlawyer from drafting trust amendments.
Here, there are distinguishing factors that support the trial court’s conclusion that the
Feldman investment form was not a valid amendment. In Landheer, the father requested that his
defendant son create an amendment to his trust agreement. Here, Marie did not hire LaGrange
Bank to amend her trust agreement or to create the Feldman investment form. LaGrange Bank,
22
Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
acting in its role as trustee, hired McNamara to prepare a document to advise Marie on changing
her trust investments. McNamara never spoke with Marie and the only information he received
concerning the trust investments was from Joyce. McNamara stated that he has never prepared a
trust amendment, that he and his company do not prepare trust amendments, and that he never
intended to prepare an amendment to Marie’s trust. In addition, there is no evidence that Joyce
acted as Marie’s lawyer or agent in giving the Feldman investment form to Marie for her
approval, or that Joyce intended the form to be an amendment to the trust when he gave it to
Marie for her approval. Joyce testified that he does not draft legal documents and that LaGrange
does not offer its clients an attorney to do so.
Plaintiffs further claim, as did the defendant in Landheer, that McNamara acted as a
“scrivener” because the Feldman investment form “perfectly reflected the intentions that [Marie]
had expressed so often.” We find this argument not persuasive, as did the Landheer court.
In Landheer, the appellate court found that although the son spoke with his father and the
father approved the drafted amendment was “what he wanted.” The court rejected defendant’s
“scrivener” argument because, in drafting the document, the son decided what language to use
and even added some details of his own. Landheer, 383 Ill. App. 3d at 322.
In this case, it is undisputed that McNamara never spoke with Marie and that any
information he received concerning Marie’s investments was received second-hand from Joyce.
He also testified that he could not recall Joyce’s exact language when he wrote in the comments
section of the Feldman investment form. Moreover, McNamara stated that he had no idea that he
was preparing a trust amendment, and therefore, could not be a “scrivener.”
23
Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
In addition, plaintiffs argue that the Feldman investment form, which was signed by Marie,
complies with the trust’s requirement that Marie, as settlor, may amend the trust “by instrument in
writing (other than a will).” Black’s Law Dictionary defines an “instrument” as a “written legal
document that defines rights, duties, entitlements, or liabilities, such as a contract, will,
promissory note, or share certificate.” Black’s Law Dictionary 869 (9th ed. 2009).
Plaintiffs cite Whittaker v. Stables, 339 Ill. App. 3d 943 (2003), for support. At issue in
Whittaker was whether a letter from settlor to her daughter which amended the terms of her trust
constituted a signed instrument. The daughter admitted to destroying the letter; however, the
settlor’s daughter-in-law testified to the contents of the letter. In deciding whether the letter
constituted a signed instrument, the Second District of the Illinois Appellate Court did not
consider this issue because it “assume[d] that the writing possessed the wording necessary for the
status of a signed instrument.” Whittaker, 339 Ill. App. 3d at 947.
In this case, unlike in Whittaker, we do not need to assume any wording in the Feldman
investment form because it is included in the record. Plaintiff does not point to any wording in the
Feldman investment form that “defines rights, duties, entitlements, or liabilities” that would make
it an “instrument.” Furthermore, there is no evidence that the Feldman investment form
constitutes a “legal document.” The Feldman investment form proposed a reallocation of Marie’s
stock investments. In addition, Joyce and McNamara both testified that the Feldman investment
form was created to recommend to Marie how to reallocate her stock investments. They further
testified that her signature under the word “approved” on the Feldman investment form reflects
her approval of the reallocation recommendation. See, e.g., Northwestern University v.
24
Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
McLoraine, 108 Ill. App. 3d 310, 318 (1982) (concluding an unsigned scrap of paper and a list of
names is not a formal legal document to constitute an instrument in writing for amending a trust
agreement).
Plaintiffs further argue that although Joyce and McNamara could not remember Marie’s
exact instructions, the Feldman investment form “perfectly reflected” Marie’s intent as is, and thus
is a valid amendment to the trust. We do not find any evidence to support that argument. Under
Illinois law, a trust must be specific as to the beneficiaries and “how the trust is to be performed.”
Eychaner v. Gross, 202 Ill. 2d 228, 253 (2002); see also Restatement (Third) of Trusts §22(1)(b)
(2003) (stating that a trust must “reasonably identify the trust property, the beneficiaries”). In
other words, it must show who the beneficiaries are and what each one will receive. The
comments section of the Feldman investment form states that the stock “assets will eventually go
to her nephews.” However, the Feldman investment form does not identify the “nephews” who
are to receive the stock assets. At the time of Marie’s death, she had two living nephews, Richard
and Joseph Bogacz. Even if “nephews” meant grandnephews, as plaintiffs claim, then the Feldman
investment form contradicts plaintiffs’ allegations in the second amended complaint that Marie
wanted the stock assets to “go to Tim,” or reflect Boylan’s or Joyce’s recollections that the stock
assets were to be bequeathed to Timothy individually. Furthermore, the “comments” section of
the Feldman investment form does not specify the proportion each “nephew” was to receive.
In sum, there is no dispute that the Feldman investment form was prepared by an
nonlawyer in violation of section 2BB of the Consumer Fraud Act and as a result is void. Further,
the Feldman investment form is not a valid amendment to the trust even if it had been prepared by
25
Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
a lawyer for the reasons stated. Accordingly, the trial court properly granted the Charities motion
for summary judgment and properly denied plaintiffs’ cross motion for summary judgment.
Plaintiffs’ Motion to Dismiss LaGrange Bank
Second, plaintiffs claim that the trial court erred in granting LaGrange Bank’s motion to
dismiss plaintiffs’ second amended complaint pursuant to sections 2-619(a)(9) and section 2-615
because LaGrange Bank failed to either retain an attorney to draft the amendment to the trust or
contact or appoint an attorney for Marie to do so.
Section 2-619(a)(9) permits involuntary dismissal where “the claim asserted against
defendant is barred by other affirmative matter avoiding the legal effect of or defeating the claim.”
735 ILCS 5/2-619(a)(9) (West 2008). In a motion to dismiss under section 2-619(a)(9), all well-
pleaded facts and reasonable inferences are accepted as true for the purpose of the motion and the
motion should be granted only if the plaintiff can prove no set of facts that would support a cause
of action. Feltmeier v. Feltmeier, 207 Ill. 2d 263, 277-78 (2003). The pleadings, depositions,
and affidavits must be construed “in the light most favorable to the nonmoving party.” In re
Chicago Flood Litigation, 176 Ill. 2d 179, 189 (1997); Fuller Family Holdings, LLC v. Northern
Trust Co., 371 Ill. App. 3d 605, 613 (2007). When considering an appeal from a section 2-619
dismissal, reviewing courts must determine whether a genuine issue of material fact exists which
should have precluded dismissal and, if no such issue exists, whether dismissal was proper as a
matter of law. Lang v. Silva, 306 Ill. App. 3d 960, 970 (1999). Our review of dismissals under
section 2-619 of the Code is de novo. Van Meter v. Darien Park District, 207 Ill. 2d 359, 368
(2003); Lang, 306 Ill. App. 3d at 970 (citing Spiegel v. Hollywood Towers Condominium Ass’n,
26
Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
283 Ill. App. 3d 992, 998 (1996)).
A motion to dismiss under section 2-615 of the Code is a challenge to the legal sufficiency
of the complaint. 735 ILCS 5/2-615 (West 2008). In reviewing the legal sufficiency of a
complaint, we regard all well-pled facts as true and draw all reasonable inferences in favor of the
non-moving party. Wakulich v. Mraz, 203 Ill. 2d 223, 228 (2003); Iseberg v. Gross, 366 Ill. App.
3d 857, 860 (2006). We construe the complaint liberally and dismiss only when it appears that
plaintiffs cannot recover under any set of facts. Wakulich, 203 Ill. 2d at 228; Iseberg, 366 Ill.
App. 3d at 861. The standard of review from the granting of a section 2-615 motion to dismiss is
de novo. Wakulich, 203 Ill. 2d at 228; Flournoy v. Ameritech, 351 Ill. App. 3d 583, 586 (2004)
(citing Krilich v. American National Bank & Trust Co. of Chicago, 334 Ill. App. 3d 563 (2002)).
As an initial matter, the parties argue whether that the trial court properly found
inconsistencies between their verified first amended complaint and their verified second amended
complaint. Specifically, LaGrange Bank argues that in plaintiffs’ first verified amended complaint,
plaintiffs allege that Boylan was Marie’s estate planning attorney. However, in the verified second
amended complaint plaintiffs allege that Boylan was only hired to amend the trust agreement and
appoint LaGrange Bank as successor trustee. Plaintiffs argue that the two complaints are not
inconsistent but, rather, show that Boylan’s employment was limited in scope to only amending
the trust agreement to appoint LaGrange Bank as trustee. Plaintiffs further argue that because
Boylan was not employed to make any further amendments, the duty to amend Marie’s trust
shifted to LaGrange Bank.
We need not decide that issue. Even if, in construing all pleadings, depositions, and
27
Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
affidavits in the light most favorable to plaintiffs, we agree with plaintiffs that the allegations in the
two amended complaints are not inconsistent, we would still conclude that LaGrange Bank had
no duty to amend the trust and that the trial court properly granted the motion to dismiss.
To state a cause of action for breach of a fiduciary duty, a plaintiff must allege and
ultimately prove: (1) a fiduciary duty on part of the defendant; (2) a breach of that duty; (3)
damages; and (4) a proximate cause between the breach and the damages. Martin v. Heinold
Commodities, Inc., 163 Ill. 2d 33, 53 (1994); Alpha School Bus Co. v. Wagner, 391 Ill. App. 3d
722, 747 (2009). “ ‘ “A trustee owes a fiduciary duty to a trust’s beneficiaries and is obligated to
carry out the trust according to its terms and to act with the highest degrees of fidelity and utmost
good faith.” ’ ” (Emphasis added). Fuller Family Holdings, LLC v. Northern Trust Co., 371 Ill.
App. 3d 605, 615 (2007) (quoting In re Estate of Muppavarapu, 359 Ill. App. 3d 925, 929
(2005), quoting Giagnorio v. Emmett C. Torkelson Trust, 292 Ill. App. 3d 318, 325(1997)). See
also Stuart v. Continental Illinois National Bank & Trust Co., 68 Ill. 2d 502, 523 (1977);
Chicago Title & Trust Co. v. Chief Wash Co., 368 Ill. 146, 155 (1938); Paul H. Schwendener,
Inc. v. Jupiter Electric Co., 358 Ill. App. 3d 65, 74 (2005); Restatement (Second) of Trusts §2,
Comment b (1959); Restatement (Second) of Trusts §170 (1959).
In the case at bar, plaintiffs do not cite any authority to support their claim that LaGrange
Bank, as trustee, owed them a duty to either: appoint or consult an attorney concerning amending
Marie’s trust; communicate with Marie concerning amending her trust; or “institute adequate
follow-up procedures” to amend Marie’s trust. In addition, having found that the Feldman
investment form is not a valid amendment to Marie’s trust agreement, plaintiffs also do not cite
28
Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
any terms in Marie’s trust agreement that impose a legal duty for LaGrange Bank to act to amend
the trust agreement.
Further, LaGrange Bank, a corporation, is prohibited from practicing law and thus, is
prohibited from drafting trust agreements. 705 ILCS 220/0.01 et seq. (West 2008). Joyce also
testified that LaGrange Bank does not draft legal documents for its clients and does not employ
an attorney to do so. The duty to draft an amendment was Marie’s obligation. Boylan was her
attorney for estate planning at the time and was never told by Marie to prepare an amendment.
This duty does not fall to LaGrange Bank because LaGrange Bank was aware that Marie intended
to amend her trust and may have not had an attorney that she trusted to effectuate that
amendment. It is equally possible that she did not want Boylan or any attorney to amend her trust
at the point in time of her death.
Plaintiff further claims that LaGrange Bank voluntarily assumed a duty because Joyce
“assured [Marie] he would coordinate professionals including contacting attorneys *** as needed
on her behalf ***.” A duty associated with a voluntary undertaking is limited to the extent of the
undertaking. Rice v. White, 374 Ill. App. 3d 870, 886 (2007). Thus, according to plaintiffs’
second amended complaint, LaGrange Bank’s breach of its voluntary duty is that it failed to
contact or retain an attorney on her behalf.
However, to state a cause of action for breach of a fiduciary duty, plaintiffs must show
that the breach is a proximate cause of the damages. Although proximate cause is generally a
question of fact for the trier of fact, a court may determine a lack of proximate cause as a matter
of law where the facts fail to establish both a “cause in fact” and “legal cause.” Rice, 374 Ill. App.
29
Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
3d at 888 (citing First Springfield Bank & Trust v. Galman, 188 Ill. 2d 252, 257-58 (1999)). A
defendant’s conduct is a “cause in fact” of the plaintiff’s damages if the damages would not have
occurred absent defendant’s conduct. Abrams v. City of Chicago, 211 Ill. 2d 251, 258 (2004). A
defendant’s conduct is a “legal cause” of a plaintiff’s damages if a reasonable person would find
the damages as a foreseeable or likely result of defendant’s conduct. Abrams, 211 Ill. 2d at 258.
In the case at bar, Joyce’s failure to contact or retain an attorney is not the cause in fact or
legal cause of plaintiffs’ damages. Rather, the failure to amend Marie’s trust with a valid
amendment that would show her intentions was the proximate cause of plaintiff’s damages.
In sum, dismissal of plaintiffs’ second amended complaint was proper under section 2-
619(a)(9) of the Code because LaGrange Bank is prevented from practicing law under the
Corporate Practice of Law Prohibition Act (705 ILCS 220/0.01 (West 2008)). Dismissal was
also proper under section 2-615 because plaintiffs failed to state a cause of action for breach of
fiduciary duty because LaGrange Bank had no duty to plaintiffs and even if LaGrange Bank
assumed a voluntary duty, it was not the proximate cause of plaintiffs’ damages as a matter of
law.
Plaintiff’s Motion for Attorney Fees
Third, plaintiffs request that we reverse the trial court’s motion denying plaintiffs’ motion
for reimbursement of attorney fees and costs if we find that the trial court erred in granting
summary judgment in favor of the Charities and against plaintiffs or granting LaGrange Bank’s
motion to dismiss. Having affirmed the trial court’s decision on those two issues, we must also
affirm the trial court’s denial of plaintiffs’ motion for reimbursement of attorney fees and costs
30
Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
because we have not reversed the trial court. We need not decide whether plaintiffs would have
received reimbursement of attorney fees and costs had we reversed the trial court because that did
not occur here.
LaGrange Bank’s Motion for Attorneys Fees
LaGrange Bank claims the trial court erred when it found that it lacked jurisdiction to hear
LaGrange Bank’s motion for reimbursement of attorney fees because the motion was untimely
filed. Whether a motion was timely filed and whether a court has jurisdiction to hear such a
motion is a question of law which we review under a de novo standard. See In re Estate of Ahern,
359 Ill. App. 3d 805, 809 (2005); In re Estate of Gebis, 186 Ill. 2d 188, 192 (1999)
In this case, the trial court granted LaGrange Bank motion to dismiss on June 17, 2008
with prejudice. On December 2, 2008, the trial court granted LaGrange Bank’s request to insert
Rule 304(a) language in the June 17 order, stating that the order is a final order and “[t]here is no
just reason for delaying either enforcement or appeal or both.” On July 22, 2009, LaGrange Bank
then filed a motion for attorney fees. The trial court found that, to be timely, LaGrange Bank’s
motion should have been filed within 30 days of December 2, 2008, when the trial court inserted
language pursuant to Rule 304(a) into the June 17, 2008, order.
Illinois Supreme Court Rule 304(a) provides that “an appeal may be taken from a final
judgment as to one or more but fewer than all of the parties or claims only if the trial court has
made an express written finding that there is no just reason for delaying either enforcement or
appeal [or both].” Ill. S. Ct. R. 304(a) (eff. Jan. 1, 1989). An order is “final” if it either terminates
the litigation between the parties on the merits or disposes of the rights of the parties either on the
31
Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
entire controversy or on separate and definite part of it. Ariola v. Nigro, 13 Ill. 2d 200, 207
(1958).
A circuit court retains jurisdiction for 30 days after its entry of a final order or judgment.
Brewer v. National R.R. Passenger Corp., 165 Ill. 2d 100, 105 (1995); Suburban Auto
Rebuilders, Inc. v. Associated Tile Dealers Warehouse, Inc., 388 Ill. App. 3d 81, 96 (2009). A
circuit court has jurisdiction to entertain a motion for attorney fees filed within 30 days of the
entry of a final judgment without regard to a previously filed notice of appeal. John G. Phillips &
Associates v. Brown, 197 Ill. 2d 337, 343 (2001); Marsh v. Evangelical Covenant Church of
Hinsdale, 138 Ill. 2d 458, 468-69 (1990); Servio v. Paul Roberts Auto Sales, Inc., 211 Ill. App.
3d 751, 760 (1991). In addition, a circuit court has jurisdiction to address a timely-filed motion
for attorney fees regardless of whether the request is considered to be part of the original action
or collateral to the original claim. John G. Phillips & Associates, 197 Ill. 2d at 343; Marsh, 138
Ill. 2d at 460; Physicians Insurance Exchange v. Jennings, 316 Ill. App. 3d 443, 453 (2000);
Berger v. Matthews, 216 Ill. App. 3d 942, 944 (1991); Servio, 211 Ill. App. 3d at 759-60.
LaGrange Bank argues that its motion for attorney fees was timely filed because the
motion is not a posttrial motion pursuant to section 2-1203 of the Code, and thus, the 30-day
limitation does not apply. See Brown & Kerr, Inc. v. American Stores Properties, Inc., 306 Ill.
App. 3d 1023, 1028 (1999); F.H. Prince & Co. v. Towers Financial Corp., 266 Ill. App. 3d 977,
983 (1994) (“a claim for attorney fees is not a post-trial motion within sections 2-1202 and 2-
1203 of the Code *** nor, even if viewed as a motion to modify the judgment, is it a post-trial
motion ‘directed against the judgment’ within the meaning of Supreme Court Rule 303(a).”).
32
Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
Plaintiffs agree that a motion for reimbursement is not a posttrial motion, but argue that LaGrange
Bank is still subject to a 30-day limitation to file its motion.
Section 2-1203 provides that “[i]n all cases tried without a jury, any party may, within 30
days after entry of the judgment *** file a motion for a rehearing, or a retrial, or a modification of
the judgment or to vacate the judgment or for other relief.” 735 ILCS 5/2-1203 (West 2008).
We find LaGrange Bank’s argument not persuasive. LaGrange Bank’s argument implies
that if a motion is not a posttrial motion pursuant to sections 2-1202 or 2-1203, then the trial
court retains jurisdiction without limitation. A trial court has jurisdiction over the underlying
action until “30 days after entry of that final judgment [citations]; or 30 days after ruling on the
last pending post-trial motion [citation].” F.H. Prince, 266 Ill. App. 3d at 988; People v.
Flowers, 208 Ill. 2d 291, 303 (2003) (trial court loses jurisdiction over a matter 30 days after
entry of final judgment, unless a timely postjudgment motion is filed).
In the case at bar, the trial court’s June 17, 2008, order became a final order on December
2, 2008, when the trial court inserted Rule 304(a) language making it a final and appealable order.
As a result, the final judgment terminated the litigation between LaGrange Bank and plaintiffs.
See Glickman v. Teglia, 388 Ill. App. 3d 141, 151 (2009) (when all claims against a party are
dismissed that party is no longer before the trial court once the 30-day period after the dismissal
passes). Thus, LaGrange Bank had until January 2, 2008, 30 days after the order became a final
judgment, excluding the January 1, 2008, holiday, in which to file its motion for attorney fees.
However, LaGrange Bank did not file its motion for attorney fees until approximately six months
later, on July 22, 2009. Therefore, the trial court correctly found that it lacked jurisdiction to
33
Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
consider that motion because it was untimely filed.
LaGrange Bank next argues that a trial court retains post-judgment jurisdiction to
determine matters collateral or incidental to the judgment, such as a motion for attorney fees. In
re Estate of Denaro, 112 Ill. App. 3d 872, 878 (1983) (“The general rule is that the filing of an
appeal divests the trial court of jurisdiction; however, the trial court retains jurisdiction to
determine matters collateral or incidental to the judgment. [Citation]. Collateral or supplemental
matters include those lying outside the issues in the appeal or arising subsequent to delivery of the
judgment appealed from.”). LaGrange Bank further argues that the time when a trial court loses
jurisdiction to hear collateral or incidental matters to the judgment is not until “30 days past the
date of the last order or judgment was issued in the case.” Gaynor v. Walsh, 219 Ill. App. 3d 996,
1002 (1991). LaGrange Bank then concludes that its motion for attorney fees was timely filed
within 30 days of the last order entered in the case, the trial court’s order granting summary
judgment in favor of the Charities and against plaintiffs on July 7, 2009.
We also find this argument not persuasive. In Gaynor, a plaintiff filed a complaint against
a defendant alleging wrongful transfer of partnership assets. On September 12, 1990, the trial
court granted defendant’s motion for summary judgment. On September 20, the plaintiff filed a
posttrial motion to reconsider which was denied on November 15, 1990. None of the orders
contained Rule 304(a) language. On December 10, 1990, within 30 days of the trial court’s ruling
on plaintiff’s posttrial motion, the defendant filed a motion for attorney fees pursuant to Supreme
Court Rule 137 (Ill. S. Ct. R. 137 (eff. Aug. 1, 1989)). The Gaynor court found that the trial
court retained jurisdiction over the motion for attorney fees because defendant filed the motion
34
Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
within 30 days of the trial court’s order denying plaintiff’s posttrial motion and that order did not
contain Rule 304(a) language. Gaynor, 219 Ill. App. 3d at 998.
Similarly, in F.H. Prince, a plaintiff’s complaint sought entry of a judgment against a
defendant in an amount of the principal and interest due on a settlement agreement plus attorney
fees and costs. After a jury trial, the trial court entered a judgment for plaintiffs on February 6,
1991, for the principal and interest due. On February 25, 1991, the plaintiff filed a petition for an
award of interim attorney fees based upon a fee shifting provision in the settlement agreement. On
April 4, 1991, the trial court entered a judgment for attorney fees in favor of plaintiff. On the
same day, the defendant filed a posttrial motion, which the trial court denied on May 8, 1991. The
following day, the plaintiff filed a second petition for attorney fees covering the period through
May 8. On May 13, 1991 the defendant filed a notice of appeal from the orders and judgments
entered through May 8, 1991. The trial court held that it had jurisdiction to hear the plaintiff’s
motion for attorney fees file on May 9, 1991 and entered judgment on that motion. F.H. Prince,
266 Ill. App. 3d at 979-80.
The appellate court, which relied on Gaynor in its decision, found that the petition for
attorney fees was a timely filed claim because it was filed one day after the trial court’s denial of
defendant’s posttrial motion, “well within the 30-day period following that denial, and while the
[trial] court retained jurisdiction to set aside any final judgment or order.”
Although these two cases are distinguishable from the case at bar because: (a) they did not
involve multiple parties; (b) none of the orders contained language pursuant to Rule 304(a) and
(c) motions for attorneys fees was a sanction pursuant to Rule 137 (Ill. S. Ct. R. 137 (eff. Aug. 1,
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Nos. 1-09-0038; 1-09-1892; 1-09-3295; 1-09-3431; 1-10-0070; 1-10-0071 (cons.)
1989)), we do not find that they support LaGrange Bank’s argument that a trial court retains
jurisdiction over a dismissed party’s claims until all claims in the litigation are resolved.
In addition, the cases LaGrange Bank cites for additional support of its argument are
distinguishable from the case at bar because the motions for attorney fees in those cases were all
filed within 30 days of the final judgment which allowed the trial court to retain post-judgment
jurisdiction. See, e.g., Town of Libertyville v. Bank of Waukegan, 152 Ill. App. 3d 1066, 1072
(1987) (trial court retained jurisdiction to hear claim for attorney fees which was filed within 30
days of the final judgment); Physicians Insurance Exchange v. Jennings, 316 Ill. App. 3d 443,
453 (2000) (trial court retained jurisdiction to hear claim for tax costs and motion filed within 30
days of final judgment). American National Bank & Trust Co. of Chicago v. Bus, 212 Ill. App. 3d
133, 138 (1991) (trial court retained jurisdiction to hear motion for Rule 137 sanctions which was
filed within 30 days of judgment).
In the case at bar, the June 17, 2008 order dismissing LaGrange Bank from the litigation
became a final judgment on December 2, 2008, when the trial court inserted into that order the
Rule 304(a) language at LaGrange Bank’s request. LaGrange Bank then had a 30-day period
following that denial to file its motion for reimbursement of attorney fees, but it failed to do so.
Accordingly, we find the trial court correctly found that it lacked jurisdiction to hear that motion.
CONCLUSION
For the foregoing reasons we affirm the judgment of the circuit court of Cook County.
Affirmed.
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