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07/21/89 Chicago City Bank and v. Gertrude Pick Lesman Et Al

July 21, 1989

CHICAGO CITY BANK AND TRUST COMPANY, AS SUCCESSOR TRUSTEE, PLAINTIFF-APPELLEE

v.

GERTRUDE PICK LESMAN ET AL., DEFENDANTS-APPELLANTS



APPELLATE COURT OF ILLINOIS, FIRST DISTRICT, SIXTH DIVISION

542 N.E.2d 824, 186 Ill. App. 3d 697, 134 Ill. Dec. 478 1989.IL.1137

Appeal from the Circuit Court of Cook County; the Hon. Robert L. Sklodowski, Judge, presiding.

APPELLATE Judges:

JUSTICE QUINLAN delivered the opinion of the court. EGAN, P.J., and LaPORTA, J., concur.

DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE QUINLAN

The plaintiff, Chicago City Bank and Trust Company (the Bank), acting as the trustee for a trust established by Albert Pick, Sr., filed a complaint in the chancery division of the circuit court of Cook County, for instructions concerning the identification of remainder beneficiaries and the distribution of the remaining funds in the trust. Thereafter, one of the remainder beneficiaries, John Albert Pick (John A.) filed a pro se counterclaim against the Bank in which he alleged that the Bank had breached its fiduciary duties to him and the other beneficiaries, and, based on the allegations, he requested an accounting. The Bank moved to dismiss the counterclaim and requested fees and costs. Subsequently, the trial court dismissed the counterclaim and awarded attorney fees and costs to the Bank, to be paid out of the trust. John A. appeals the dismissal of his counterclaim and the award of fees and costs. We affirm.

In 1946, Albert Pick, Sr., set up a $25,000 trust for his son, John L. Pick (John L.), who was to receive $100 a month from the trust for the rest of his life. *fn1 John L., the income beneficiary of the trust, died intestate in 1983. Apparently, the terms of the trust were somewhat ambiguous concerning the designation of the remainder beneficiaries and the distribution of the remainder of the trust, and so, to avoid the costs of litigation, the Bank sought an agreed settlement from those who apparently would be the remainder beneficiaries about the distribution of the remaining funds in the trust, which was about $30,000.

John A., John L.'s son, identified by the Bank as a remainder beneficiary, refused to agree to this settlement until a full accounting was proffered by the trustee for the entire 34-year history of the trust. John A. asserted that there was some type of fraud or mismanagement and collusion in the administration of the trust because only $30,000 remained. The Bank refused John A.'s demand for an accounting, and when John A. still refused to agree to the proposed distribution, the Bank informed him that the matter would have to be resolved in court.

The Bank then filed the present complaint for instructions, asking the court to interpret the ambiguous terms of the trust and to determine who the remainder beneficiaries were and what the proper distribution of the remaining funds in the trust should be. John A., as noted, responded by filing a pro se counterclaim, and then an amended counterclaim, against the Bank which basically alleged malicious and fraudulent breach of fiduciary duty. John A. also requested a full accounting of the trust and damages in excess of $5 million for economic loss and emotional distress, as well as punitive damages. In addition to these claims, John A. also filed a third-party complaint against Metzel, the conservator, and others. This third-party complaint against the conservator and others was later transferred to the probate division on April 30, 1987.

The Bank filed a section 2-611 motion for sanctions based on John A.'s counterclaim. (See Ill. Rev. Stat. 1987, ch. 110, par. 2-611.) On December 15, 1987, a pretrial conference was held on these pending matters. This pretrial conference was not transcribed, but, during oral argument before this court, the parties explained that the Bank made an oral section 2-615 motion to dismiss the counterclaim (see Ill. Rev. Stat. 1987, ch. 110, par. 2-615), and, specifically, John A. stated that he had made no objection to this motion then, and that he was, in fact, in favor of the entry of a final order in the matter at that time because, he said, he wanted to take the matter up in a different court, i.e., the appellate court.

As a result of the pretrial conference, an order was entered which directed the distribution of the remainder of the trust in the amount of one-third to John L.'s widow, and the remaining two-thirds to the issue of John L., with John A. designated as a lawful issue; identified the beneficiaries, including John A. as a beneficiary; ordered the Bank to submit a final accounting for court approval at the Conclusion of the matter of all administration expenses incurred in connection with the trust and the suit, including attorney fees and costs, and that those costs were to be paid from the trust estate prior to distribution; dismissed John A.'s counterclaim with prejudice and denied his request for an accounting based on the representations of the parties that the Bank had regularly provided accountings to the conservator of the trust during John L.'s lifetime; and provided that the order was final and appealable and disposed of all of the pending matters in the litigation.

On January 11, 1988, John A. filed a notice of appeal as to that portion of the December 15, 1987, order which granted the payment of attorney fees and dismissed his counterclaim with prejudice. John A. also appealed from the trial court's order of April 30, 1987, which transferred his third-party complaint from the chancery division to the probate division.

Three basic issues are raised on appeal: (1) whether the trial court properly dismissed John A.'s counterclaim; (2) whether the trial court properly awarded fees and costs; and (3) whether the trial court erred when it transferred his third-party complaint to the probate division.

John A. first argues that the trial court improperly dismissed his counterclaim. The counterclaim essentially is based upon a claim of breach of fiduciary duty and a claim for an accounting. The oral motion to dismiss was made pursuant to section 2-615 of the Code of Civil Procedure, *fn2 and, thus, was premised on the argument that the counterclaim failed to state a cause of action, because either there was no such cause of action or ...


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