APPELLATE COURT OF ILLINOIS, THIRD DISTRICT
Ierulli, as Ex'r of the Estate of Anthony J. Ierulli,
First National Bank of Peoria, as Trustee,
521 N.E.2d 654, 167 Ill. App. 3d 595, 118 Ill. Dec. 372 1988.IL.490
Appeal from the Circuit Court of Peoria County; the Hon. Thomas G. Ebel, Judge, presiding.
PRESIDING JUSTICE STOUDER delivered the opinion of the court. SCOTT, J., concurs. JUSTICE WOMBACHER, Dissenting.
DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE STOUDER
The claimant, First National Bank of Peoria (First National), filed a claim against the estate of Anthony Ierulli seeking recovery of cash and premium loans, accumulated interest, and dividend withdrawals totalling $108,277.88. These funds were to become the corpus of a life insurance trust agreement entered into upon the dissolution of the marriage of Anthony and Elaine Ierulli and of which First National was the trustee. After a bench trial, judgment was entered for the claimant in that amount plus interest and the executrix has appealed. The executrix, Lydia Ierulli, contends that (1) the decedent's former wife, Elaine, was precluded from testifying under the Illinois Dead Man's Act as codified in section 8-201 of the Illinois Code of Civil Procedure (Ill. Rev. Stat. 1985, ch. 110, par. 8-201), and (2) First National, as trustee, was entitled only to the net proceeds of the policy in accordance with its terms but was not entitled to recover the loans, interest, and withdrawals which comprised its claim.
First National is the trustee for the four Ierulli children under the life insurance trust agreement established by Anthony and funded upon his death by a life insurance policy. This trust was executed pursuant to the terms of the judgment of dissolution of marriage of Anthony and Elaine. Under the terms of the judgment, Anthony was to
"immediately execute a Life Insurance Trust Agreement consisting of a policy of insurance upon his life with the Vermont Life Insurance Company in the face amount of Two Hundred Fifty Thousand ($250,000.00) Dollars, wherein the First National Bank of Peoria, Peoria, Illinois is to be the Trustee, and which Trust upon his death shall provide income for the maintenance, support and education of the said children until they attain the age of thirty (30) years, at which time each child as he or she attains the age of thirty (30) years shall receive his proportionate share of the Trust Principal and accumulated income, and the Defendant is to pay the premium as it becomes due on said Policy of Insurance."
The trust agreement, which First National claims Anthony violated and which brings rise to this cause, provides:
"2. The Settlor shall have full power at all times during his lifetime, provided that he give the said Elaine J. Ierulli, her Administrator, Executor or Legal Representative, at least thirty (30) days ...