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Northern Trust Co. v. Moscatelli

DECEMBER 24, 1964.

THE NORTHERN TRUST COMPANY, WALTER J. MADIGAN AND MARSHALL G. SAMPSELL, AS TRUSTEES UNDER THE LAST WILL OF EBER B. WARD, DECEASED, AND AS TRUSTEES UNDER AN INDENTURE OF TRUST, MADE AND EXECUTED BY YOLANDE ELIMIENNE WARD, DECEASED, PLAINTIFFS-APPELLEES,

v.

GIUSEPPE CARLO MOSCATELLI, LUCA SCHENINI, AND FRED UTZ, AS EXECUTOR UNDER A CERTAIN DOCUMENT PURPORTING TO BE A LAST WILL OF LINA KUNZ DAHMER, DECEASED, UNKNOWN LEGATEES, INTESTATE SUCCESSORS, HEIRS OR SUCCESSORS IN INTEREST OF YOLANDE E. WARD OR EBER B. WARD, DECEASED, OR CERTAIN OTHER DECEASED PERSON OR PERSONS, AND UNKNOWN OWNERS, DEFENDANTS-APPELLEES. ON APPEAL OF EUGENIE PHYLLIS WARD AND THERESE DEHEECKEREN (OR "DEHUEKEREN") D'ANTHES (ALSO KNOWN AS MARCELLE PATTO), DEFENDANTS-APPELLANTS.



Appeal from the Superior Court of Cook County; the Hon. ABRAHAM L. MAROVITZ, Judge, presiding. Decree affirmed.

MR. PRESIDING JUSTICE SCHWARTZ DELIVERED THE OPINION OF THE COURT.

This is an appeal from a decree construing the will of Yolande E. Ward in accordance with the contentions of defendant-appellee Giuseppe Carlo Moscatelli. Plaintiffs are trustees under both a testamentary trust created by the will of Eber B. Ward, executed in 1915, and an inter vivos trust created by his daughter Yolande E. Ward in 1932. Their complaint seeks to determine whether powers of appointment given to Yolande E. Ward in both instruments were properly exercised in her last will and testament. The sole beneficiary under Yolande's will is the defendant Giuseppe Carlo Moscatelli, son of Giovanni Moscatelli, of Como, Italy. Giuseppe Moscatelli filed a motion to strike the complaint on the ground that the will clearly and unequivocally expressed an intention to exercise the powers of appointment in his favor and that no construction or interpretation was necessary. The court denied his motion.

Answers were duly filed by Moscatelli and the other defendants and the cause was heard on the pleadings and a stipulation of facts. The trial court entered a decree finding that:

"Considering both the will of Yolande E. Ward and the surrounding circumstances at the time her will was executed (as determined from the admissible evidence contained in the Stipulation of Facts), the court concludes that both powers of appointment were exercised by Yolande E. Ward in favor of Giuseppe Carlo Moscatelli."

An appeal from the decree was taken by Eugenie Phyllis Ward and Therese DeHeeckeren D'Anthes (also known as Marcelle Patto), the half sister and half niece, respectively, of Yolande E. Ward, who would take under the trust agreements if it were held that the powers of appointment were not exercised. The contest on this appeal is solely between them and Moscatelli.

Eber B. Ward in his will, after making provision for his daughter Yolande, provided that:

"In case of the death of my said daughter, Yolande, after her arrival at the age of twenty-one, whether such death shall occur prior to my death or subsequent thereto, said trustees shall dispose of the property embraced in said `Yolande Ward Fund' according to the terms of the last will and testament of my said daughter Yolande. . . ."

The provisions of the trust created by Yolande for herself, whereby the income from the fund was paid to her for life, provided in almost the identical words of her father's will that:

"the trustee shall dispose of the properties embraced in said trust fund according to the terms of the Last Will and Testament of the Settlor, [Yolande E. Ward]. . . ."

Yolande Ward's will is very brief, the dispositive portion thereof being as follows:

"(2) For all my assets of any kind and nature I appoint and nominate as my universal heir Mr. Giuseppe Carlo Moscatelli, son of Giovanni, residing in Como, via Giuseppe Gorio No. 5.

"(3) In the event that my aforesaid heir is unable to accept this inheritance for any reason whatsoever, I appoint Mr. Giovanni Moscatelli, father of the first-named heir."

The principal issue in the instant case is whether this will is an adequate exercise of the dispositive powers contained in the respective trusts.

A stipulation of facts was entered into between the parties. From the pleadings and stipulation, the following facts appear. Yolande's father Eber B. Ward married four times and had three daughters. He also had a natural son. By his first marriage he had twin daughters, Eugenie Phyllis Ward (one of the two appellants here) and Esmee Lyon Ward DeHeeckeren D'Anthes, who died in 1937, whose daughter Therese DeHeeckeren D'Anthes is the other appellant here. The first marriage ended in divorce and the mother was awarded custody of the children. The second marriage also ended in divorce, but there were no children born of that marriage. Yolande was the only child of her father's third marriage. Her mother died in 1913 when Yolande was eight years old. She was reared under the supervision of a governess whom Eber Ward married as his fourth and last wife. Yolande's welfare was the subject of a codicil which Eber added to his will in 1916. When he died in 1918, Yolande was thirteen. Her custody, discipline and control fell for a period exclusively to her stepmother. All three of Eber Ward's daughters lived abroad, Eugenie in London, Esmee in Warwick, England, and Yolande in Nice, France.

Under Eber B. Ward's will a portion of his estate, amounting to about $700,000, known as the Yolande Ward Fund, was given to three co-trustees (predecessors of the plaintiffs here) in trust, the income thereof to be paid to Yolande during her natural life. The remainder, about $1,400,000, was divided equally between her two half sisters. Provision was also made for the natural son. Eber's will further provided that if Yolande did not exercise her power to appoint, the property was to pass by the intestacy laws of Illinois. The will contained a further clause granting the trustees the discretion, after Yolande reached the age of twenty-one, to pay to her part of the principal, provided that in so doing, the amount remaining in the testamentary trust would not be less than $200,000.

In 1932, acting under the provisions of the testamentary trust, the trustees agreed to distribute to Yolande approximately $500,000 of the principal in that trust. To receive that fund, Yolande on June 17, 1932, established an irrevocable inter vivos trust with the Northern Trust Company, Edward E. Barthell and Charles O. Rundall as trustees. These same parties were trustees under the testamentary trust. Rundall was a lawyer who also acted as personal attorney for Yolande and as counsel for the trusts.

In 1926 Yolande had established an agency account with The Northern Trust Company, which was closed out in 1949. At the time she drew her will in December 1942 there was about $216,000 in that account. Generally speaking, an agency account is one in which securities are deposited with a bank without transfer of title, but with such authority as the principal may delegate to receive dividends, clip and present interest coupons for payment, and deposit the same to the credit of the principal, and for such other duties as may be covered in the agency agreement.

Yolande married one Luca Schenini in Italy in 1936, but in April 1941 she wrote Rundall that she had begun separation proceedings; that Rundall should not send any more money to her husband; and that all correspondence with her should be directed to her in care of Signor Mario Valenti, her Italian counsel. She also asked that a copy of her father's will be sent her and that Rundall advise her "what the estate is that belongs to me which you administrate." Rundall replied on May 9, 1941, telling her about the testamentary trust of her father, the inter vivos trust which she had established in 1932 pursuant to her father's will, and about the agency account, and enclosed the documents she requested. A complete statement of the assets in the three funds being administered by The Northern Trust Company accompanied his letter and he added some comments as to the quality of some of the investments and holdings.

On June 16, 1941, Rundall wrote to Yolande, replying to a cablegram requesting funds, telling her that the transfer of funds was prohibited at that time by executive order of the President because of the European war, saying:

"You must bear in mind that under the conditions of the trusts which control your funds it is provided that in case of your death the trust assets will go directly to those persons named in your will, and in the absence of such a will to those determined in accordance with the law of intestate succession of the State of Illinois.

"This means that if you should die in your present condition, Mr. Schenini will inherit all of your personal property and one-half of your realty, and I presume you do not want this to happen. Therefore, it is important that you consider with Sig. Valenti the advisability of making a will.

"But in so doing you cannot deprive Mr. Schenini of a substantial part of your estate so long as the marital relationship continues."

There is also in evidence a letter of September 25, 1945, from Rundall to Yolande, telling of his efforts to communicate with her through the International Red Cross, the State Department of Switzerland, and the foreign office of the Vatican in Rome "realizing that you must be suffering ...


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