APPEAL from the Circuit Court of Cook County; the Hon. ANTHONY
J. KOGUT, Judge, presiding.
MR. PRESIDING JUSTICE STAMOS DELIVERED THE OPINION OF THE COURT:
This is an appeal by an executor from an order entered on May 10, 1977, in a decedent's estate pending since April 1973, ordering the executor to make a partial distribution to two heirs and legatees of decedent, without requiring them to post a refunding bond. The issues are: (1) whether the trial court's order is final and appealable by the executor; and (2) whether the trial court erred in entering the order for partial distribution without requiring a showing that there are sufficient assets to pay claims against the estate and to pay specific bequests, and without requiring a refunding bond. The pertinent facts follow.
Decedent, Demos Tingos, died on January 25, 1973. His will, which was admitted to probate, nominated appellant, Louis J. Prempas, as executor. Letters testamentary were issued to appellant on April 25, 1973. A court order declaring heirship reveals that decedent left the following persons as heirs: his parents, petitioners herein, Peter and Lambrine Tingos; and his sister, Dina Antoniou.
According to the supplemental inventory filed by appellant and approved by the court, decedent left an estate valued at $278,912.76. Decedent's ownership of stock in two closely held corporations, Demos News, Inc., a newstand, and Nordic House, Inc., a restaurant, accounted for $136,000 of that total. The remainder of the estate was composed chiefly of cash, accounts receivable, and other stocks.
Decedent's will provided for the disposition of his assets in the following manner. After directing that his debts and expenses be paid, decedent's will provided for a testamentary trust to pay $10,000 per year for life to his parents, Peter and Lambrine Tingos, or the survivor. The trust was to be funded with an initial amount of $100,000, to be provided from the following assets in the following order: decedent's cash; his stocks other than the stock he owned in Demos News and Nordic House; and the profits earned by Demos News. His will then specifically bequeathed his stock in Demos News and Nordic House and gave the residue of his estate to various persons who are not parties to this appeal. In addition, the will contained a specific bequest of $5000 to the Holy Trinity Church.
During the pendency of the estate, various actions, objections, and citations were filed by persons interested in the estate. Among these were a will contest and a suit to construe the will, filed by petitioners, as well as an $85,000 contested claim, filed by Demetrios Antoniou (claimant), decedent's brother-in-law, which claim was later allowed as a fifth class claim.
On May 5, 1975, petitioners, claimant, and all of the other heirs and legatees except Holy Trinity Church entered into a settlement agreement, agreeing to dismiss their actions and to renounce their shares under the will. Under the agreement, which was incorporated into a settlement order entered by the court on June 4, 1975, claimant agreed to accept part of his $85,000 claim in cash and the remainder in the form of a note. Petitioners were to receive various stocks and contract rights apparently valued at somewhere between $40,000 and $50,000, over and above a $10,000 payment that had already been made to them under the will for the year 1973. Apparently, however, the stocks were not delivered to petitioners, but were delivered to their then attorney, George Karcazes, with whom they had entered into a one-third contingent fee arrangement and who also represented claimant, among others. For all that appears from the record, attorney Karcazes still holds the stocks that were to be transferred to petitioners pursuant to the settlement order.
Sometime in April 1976, represented by different counsel, petitioners, claimant, and others filed a petition to vacate the June 4, 1975, settlement order pursuant to section 72 of the Civil Practice Act. (Ill. Rev. Stat. 1975, ch. 110, par. 72.) The petition alleged inter alia that their agreement to the settlement order had been fraudulently procured in that attorney Karcazes had represented conflicting interests, in breach of his duty of loyalty to his clients, and had misrepresented the condition of the estate; that the executor had misrepresented the value of the estate; that the settlement order did not conform to the settlement agreement; and that the parties were not made aware of all this until after the settlement order had become final. The parties prayed that the court vacate the settlement order or conform the order to the agreement. This section 72 petition is apparently still pending, as no indication of its disposition is found in the record.
On February 25, 1977, petitioners filed the instant petition for partial distribution. The petition alleged that petitioners, who are residents of Greece, are the parents of the decedent and, along with decedent's sister, are his only heirs; that petitioners are also legatees under decedent's will, which provides for an annual payment of $10,000 to petitioners or the survivor; that petitioners received $10,000 for 1973, but have received no further payments; that petitioners would be entitled under the will to $10,000 per year for the years 1974, 1975, 1976, and 1977, or would be entitled to 2/3 of decedent's estate if the will were set aside; that petitioners were totally dependent upon decedent for support and said support was continual until decedent's death; that petitioners are 78 and 74 years old, in poor health, without income, assets, or medical insurance, and in need of funds for their support and care; that petitioners have filed a section 72 petition and, pending a decision on the petition, are destitute and in need of funds; that adequate funds are in existence to provide for their care pending the outcome of the proceedings, and they fear that because of their condition, they will never enjoy any of the funds due them; and that they are entitled to some money no matter what the outcome of the proceedings. Petitioners then prayed that the court order appellant to pay them $40,000, or if such an amount were not immediately available to the executor, that it be paid out of funds set aside pursuant to the settlement agreement and be credited to their eventual distributive share.
Appellant filed an answer to the petition for partial distribution which, inter alia, denied that petitioners were entitled to any funds and alleged that the major portion of liquid assets had been delivered to petitioners' former attorney pursuant to the settlement order.
On April 21, 1977, the court heard argument on the petition for partial distribution by attorneys for petitioners, the attorney for appellant, attorney Karcazes, who had filed a motion to dismiss the petition, pro se, and attorneys for others interested in the estate. The proceeding consisted solely of argument by counsel, and although many assertions of purported fact were made, no testimony or evidence of any kind was offered. Although the transcript of the proceeding is garbled and leaves much to be desired, the essential positions of the parties are revealed. Counsel for petitioners reiterated the allegations of their petition for partial distribution, emphasizing that petitioners were aged and in need, that they would be entitled to some funds no matter how the proceedings came out, and that between the funds in the hands of appellant and those in the hands of attorney Karcazes, there were sufficient assets in the estate to make a partial distribution without impairing the claims of creditors. In addition, counsel for petitioners informed the court that claimant, decedent's brother-in-law, would agree on the record to forego part of his claim so that petitioners could enjoy some of the fruits of the estate while petitioners still lived. Attorney Karcazes admitted that he held the stocks due petitioners under the settlement order and contended that petitioners could have taken those stocks, but instead chose to attack the settlement agreement. Counsel for appellant stated that appellant had only $11,000 on hand in the estate, approximately $6000 of which was to be used to pay another allowed claim.
The court indicated its belief that the $40,000 claim requested by petitioners was too much, but that there was more than enough money to take care of everyone in full and still permit a partial distribution of $10,000 to petitioners, who were in need and who would be entitled to at least that much in any event. Counsel for one of the other legatees asked whether a bond could be arranged, but the court indicated that a bond would not be necessary if claimant agreed to reduce his claim to the extent of the partial distribution in the event the estate's assets later proved insufficient to pay claims.
On May 10, 1977, counsel for petitioners submitted to the court a typed order reciting these facts and bearing claimant's signature in approval thereof. Handprinted in the margin was the following sentence: "It is further found and ordered by this court that this order is final and appealable and there is no just reason to delay enforcement or appeal therefrom." The order was signed and entered by the court on that same day.
On May 24, 1977, the court entered another order. The handwritten order, which was submitted by counsel for petitioners, set a hearing on appellant's discovery citation. It then gave appellant 10 days to answer the oral motion of petitioners' counsel as to why appellant should not be held in contempt for failing to pay $10,000 to petitioners pursuant to the court's order of May 10, 1977, and set a hearing on that motion. The order then recited that the paragraph in its ...