APPEAL from the Circuit Court of Cook County; the Hon. FRANCIS
T. DELANEY, Judge, presiding.
MR. JUSTICE DOWNING DELIVERED THE OPINION OF THE COURT:
This class action suit was filed by representative members of the class of owners of the beneficial interests in two apartment buildings located at 860-880 North Lake Shore Drive, Chicago, against the corporate trustee (La Salle) and the managing trustees (trustees) of the property. The complaint asked the trial court, among other things, to invalidate and amend the provisions of the trust agreement concerning the manner of appointment of the trustees, and to invalidate the method in which their number and compensation were determined. After the trial court certified the case as a class action, several beneficial owners, including appellants Margaret and Harry Axelrod (the Axelrods), exercised their statutory right to be excluded from the action. Later in the case, the new trustees, elected pursuant to an agreed order between the parties entered by the trial court, petitioned for instructions as to their duties concerning possible legal action against their predecessors. The trial court allowed service of process to be made upon the excluded members of the class, and then instructed the trustees not to proceed against the prior trustees. Independently, the class members petitioned the court for attorney's fees, which were denied. This court is presented with two separate appeals: (1) the appeal of the class members (hereinafter Wool) from the denial of attorney's fees, and (2) the appeal of the Axelrods from the entry of the order instructing the trustees. One of the class members, Herbert Hart (Hart), has intervened as an appellee in the Wool appeal.
The issues presented on the separate appeals will be set forth below in the discussion of each appeal. The statement of facts will be consolidated below for the sake of brevity.
In 1949, real estate developers built two 26-story apartment buildings at 860-880 North Lake Shore Drive and conveyed the property in trust to the Trust Co. of Chicago. La Salle is the successor corporate trustee. The beneficial interest in the property was sold by way of "certificates of beneficial interest" to a presently unknown number of beneficiaries. The trust agreement provided that trustees were to have charge of the day-to-day management of the buildings. As originally written, the agreement provided that the trustees were to be self-appointed.
In January 1977, Wool (a beneficial interest owner) filed this class action suit to have the trustees provision of the trust instrument modified. As alleged in her brief, Wool and others were unhappy with the manner in which the trustees were carrying out their functions.
After the complaint was filed, the trustees moved for dismissal. The trial court denied the motion, the trustees appealed, and this court dismissed the interlocutory appeal for want of jurisdiction.
In the interim, Wool, who had been the sole class representative, was granted leave to add 12 additional persons as named members of the representative group.
The action proceeded through various preliminary negotiation stages after dismissal of the interlocutory appeal. On February 28, 1978, the trial court entered an agreed settlement order between the parties. The order certified the case as a class action, invalidated the trust agreement provision on the appointment of the trustees, and set up the machinery for election of new trustees. The order also allowed for the filing of objections after notice by, among others, the unnamed beneficial owners.
Objections and comments were received, and a second order was entered March 28, 1978, which refined the election procedure and granted exclusion requests of the Axelrods, Hart, and several other beneficiaries. Nevertheless, the Axelrods and Hart continued to appear regularly and actively in the proceedings.
In April 1978, five new trustees were elected pursuant to the agreed orders' plans. Wool, meanwhile, filed a petition for attorney's fees as provided for in the March 28 order. The trustees opposed this petition. Hearings on the petition were held at irregular intervals over the next 12 months, and the petition was finally denied on May 31, 1979. From this ruling, Wool appeals.
During the period in which the attorney's fee petition was pending, the trustees filed with the trial court a petition for instructions, requesting to be advised as to their duties with respect to proceeding against their predecessors. The court gave leave to the trustees to have process served upon those individuals who had previously opted out of the principal action. After oral argument, the trial court instructed the trustees not to take any legal action against their predecessors. From the assertion of jurisdiction over them and from this ruling, the Axelrods appeal.
Wool urges that the trial court erred in denying her petition for attorney's fees to be paid from the trust corpus. She contends: (1) that equity allows for such an award when suit is filed which seeks construction of a trust agreement due to an honest difference of opinion of those concerned, (2) that equity allows attorney's fees to those who confer benefits upon the trust through legal action, and (3) that the principles of class actions ...