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Ohlheiser v. Shepherd

MAY 22, 1967.

CHARLOTTE CATHERINE ZIMMER OHLHEISER, ET AL., PLAINTIFFS-APPELLEES,

v.

DANA H. SHEPHERD, SUCCESSOR TRUSTEE UNDER THE LAST WILL AND TESTAMENT OF BENEDICT F. ZIMMER, DECEASED, DEFENDANT-APPELLANT.



Interlocutory appeal from the Circuit Court of Cook County; the Hon. CORNELIUS J. HARRINGTON, Judge, presiding. Affirmed.

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

Rehearing denied June 12, 1967.

Defendant, Dana H. Shepherd, a resident of Wisconsin and a successor trustee under an Illinois testamentary trust, appeals from a mandatory injunction issued by the Circuit Court of Cook County, which directed him to deliver the corpus of the trust to the clerk of the Circuit Court of Cook County, as custodian. Defendant's theory is that the trial court did not have jurisdiction in personam over defendant, "who had not submitted to the jurisdiction of the courts of this state and who was not served with process in this state."

No evidence was heard, and the facts are not in dispute. The will of Benedict F. Zimmer, a resident of Chicago, Illinois, was admitted to probate in Cook County, Illinois, on May 20, 1941. He bequeathed to his son, Benedict F. Zimmer, Jr., as trustee, shares of stock in Fritzsche Brothers, Inc. On November 8, 1952, Benedict F. Zimmer, Jr., submitted his resignation as trustee. Subsequently, on March 23, 1953, a decree was entered in Superior Court of Cook County, appointing Dana H. Shepherd, the defendant herein, as successor trustee of the testamentary trust.

The income beneficiary of the trust died on September 7, 1966, and the plaintiffs, residuary beneficiaries of the trust, sought delivery from defendant of the corpus of the trust. Defendant refused delivery until paid $27,401.95 for his services as successor trustee and, in addition, $500 for attorney's fees.

Plaintiffs then filed the instant complaint in the Circuit Court of Cook County, Illinois, in which they sought "mandatory injunction pendente lite without notice and without bond directing (a) defendant to deliver the 2,000 shares of Fritzsche Brothers, Inc. stock with stock powers to the clerk of the court; (b) judgment against defendant assessing punitive and compensatory damages for breach of trust; and (c) denial of trustee's fees."

Defendant, by local counsel, filed "his special and limited appearance in the above entitled cause for the sole purpose of questioning the court's jurisdiction over the person of this defendant, and says: 1. It appears on the face of the complaint (par 4) that this defendant was at the time of his appointment and continues to be a resident of the State of Wisconsin. 2. It appears on the face of the complaint that defendant has not submitted to the jurisdiction of the court under the provisions of Section 17 of the Civil Practice Act of Illinois in that defendant is not charged with the transaction of any business within this state, the commission of a tortious act within the state, the ownership, use or possession of any real estate situated in this state, or contracting to insure any person, property or risk located within this state at the time of contracting, and in that the matter is not an action for divorce or separate maintenance. WHEREFORE, defendant denies that this court has jurisdiction over the person of this defendant."

The order for the mandatory injunction entered November 22, 1966, shows that the question of the jurisdiction of the court over the defendant had been raised by the special appearance, and after the court heard the arguments of counsel, and "the court having examined the verified complaint of the plaintiffs and the affidavits in support of plaintiffs' said motion for a mandatory injunction and being fully advised in the premises; and the court having found that Benedict F. Zimmer died a resident of Chicago, Illinois, on March 16, 1941, and that his Last Will and Testament was admitted to probate by the Probate Court of Cook County, Illinois, on May 20, 1941 and having further found that the defendant herein, Dana H. Shepherd, was appointed Successor Trustee under the Last Will and Testament of Benedict F. Zimmer, Deceased, by the Superior Court of Cook County, Illinois, on the 23rd day of March, 1953, IT IS HEREBY ORDERED THAT: 1. This court has jurisdiction over the defendant . . .," and the clerk of the court was commanded to issue a writ of injunction directing defendant to deliver up immediately to the Clerk the Fritzsche Brothers, Inc. stock, "together with stock powers executed by said defendant as Successor-Trustee, with his signature properly guaranteed."

Initially, defendant contends "a nonresident defendant must have certain minimum contacts with the forum state before jurisdiction in personam can be obtained by service of process outside the state." Cases cited include International Shoe Co. v. Washington, 326 U.S. 310 (1945), where there was regular and substantial solicitation of business by defendant's agents physically present in the State of Washington, and the court set forth the standard by which "transaction" of business must be measured (p 316). To permit a state court to exercise in personam jurisdiction over a nonresident, the defendant must have had "certain minimum contacts" within the state, such that the maintenance of the suit does not offend "traditional notions of fair play and substantial justice."

Also cited is Hanson v. Denckla, 357 U.S. 235 (1958), where the court held that a judgment of a Florida court was not entitled to full faith and credit in Delaware because the Florida court lacked personal jurisdiction over a nonresident trustee. There, the controversy concerned part of the corpus of an inter vivos trust established in Delaware by a settlor, who later became domiciled in Florida. The Florida court sustained the position of one group of claimants, who urged that the property passed under the residuary clause of the settlor's will, which was admitted to probate in Florida. Other claimants contended that the property passed pursuant to the settlor's exercise of the inter vivos power of appointment created in the deed of the trust. The Delaware courts adopted this position and refused to accord full faith and credit to the Florida determination because the Florida court had not acquired jurisdiction over the Delaware trustee. The United States Supreme Court said (pp 250-251):

"As technological progress had increased the flow of commerce between States, the need for jurisdiction over nonresidents has undergone a similar increase. At the same time, progress in communications and transportation has made the defense of a suit in a foreign tribunal less burdensome. In response to these changes, the requirements for personal jurisdiction over nonresidents have evolved from the rigid rule of Pennoyer v. Neff, 95 U.S. 714, to the flexible standard of International Shoe Co. v. Washington, 326 U.S. 310. But it is a mistake to assume that this trend heralds the eventual demise of all restrictions on the personal jurisdiction of state courts. See Vanderbilt v. Vanderbilt, 354 U.S. 416, 418. Those restrictions are more than a guarantee of immunity from inconvenient or distant litigation. They are a consequence of territorial limitations on the power of the respective States. However minimal the burden of defending in a foreign tribunal, a defendant may not be called upon to do so unless he has had the `minimal contacts' with that State that are a prerequisite to its exercise of power over him. See International Shoe Co. v. Washington, 326 U.S. 310, 319."

Defendant further contends that "the Illinois `Long Arm Statute' [Ill Rev Stats, c 110, § 17] was passed by the legislature to provide for service on nonresidents in instances where the courts of this state could properly exercise personal jurisdiction within the limitations of due process. The legislature specifically designated the `minimum contacts' which it considered appropriate to justify exercise of such personal jurisdiction. The determination of such `minimum contacts' (within the area which would be permissible under the due process clause) is a legislative, not a judicial function."

To show that section 17 has been construed to limit the jurisdiction of the courts in personam to cases where acts enumerated in the section are shown to have occurred in Illinois, defendant cites Nelson v. Miller, 11 Ill.2d 378, 143 N.E.2d 673 (1957), which involved the "commission of a tortious act within this State," and Grobark v. Addo Mach. Co., Inc., 16 Ill.2d 426, 158 N.E.2d 73 (1959), which involved the question of whether defendant had transacted business within the State of Illinois. From these, defendant argues "that the court cannot acquire jurisdiction under the statute unless the defendant has substantial contacts with this state; unless some substantial part of the transaction occurred within this state; and unless the defendant, by his acts or conduct has invoked the benefits and protection of the laws of the forum."

Defendant further states that he was originally appointed successor trustee by the life beneficiary of the trust with the consent of the other beneficiaries, and that the 1953 proceeding in the Superior Court of Cook County was to satisfy objections of Fritzsche Brothers, Inc., and in that proceeding, "after finding that defendant had been appointed successor trustee and that consents had been executed, the court `appointed' him successor trustee." Defendant further argues that no claim is made that he did anything, either personally or by an agent, in the State of Illinois, and the only services allegedly performed by him, as trustee, were to receive dividend checks and income tax returns through the mail and to mail the dividends and affix his signature to the income ...


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