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09/30/94 ESTATE ALICE G. FLECKEN v. MELODIE WATERS

September 30, 1994

IN RE THE ESTATE OF ALICE G. FLECKEN, DECEASED, PAMELA KOLDRAS, PETITIONER-APPELLEE,
v.
MELODIE WATERS AND TAMARA PETERSON, AS CO-EXECUTORS OF THE ESTATE OF ALICE G. FLECKEN, RESPONDENTS-APPELLANTS.



Appeal from the Circuit Court of Cook County. The Honorable Henry A. Budzinski, Judge Presiding.

Egan, McNAMARA, Rakowski

The opinion of the court was delivered by: Egan

PRESIDING JUSTICE EGAN delivered the opinion of the court:

The petitioner, Pamela Koldras, filed a petition to recover certain stock certificates held by the respondents, Melodie Waters and Tamara Peterson. Pamela is the daughter of Alice Flecken (decedent), and the respondents, Melodie Waters and Tamara Peterson, are the co-executors of the estate of Alice Flecken. Waters and Peterson are the daughters of Colin Flecken, a son of Alice Flecken. The petitioner was registered on the stock certificates as a joint tenant with Alice Flecken. After an evidentiary hearing, the trial Judge ruled that the stocks were owned by the petitioner. He noted that, by virtue of the registration of the stock in joint tenancy, it was presumed that the decedent had the requisite donative intent at the time of the transfer; he ruled that the respondents failed to establish by clear and convincing evidence that the decedent lacked donative intent at the time the stocks were registered in joint tenancy.

Neither party has articulated the standard on review. We Judge that the respondents must establish that the Judge's findings were against the manifest weight of the evidence.

Before 1966 the decedent and her husband purchased stock in Tenneco, Inc. and Allied Signal, Inc. When her husband died in 1966, the decedent registered the stocks in joint tenancy with her daughter, the petitioner, and the decedent's son, Colin Flecken. Colin held those certificates because he owned a safe. In 1986, the decedent and Colin had a "falling out." The decedent filed a chancery action to remove Colin as a joint tenant on the stocks. In May 1987, Colin turned the endorsed stock certificates over to the decedent's attorney in settlement of the action.

In 1986, the decedent became ill with leukemia. She added the petitioner as a joint tenant on several of her bank accounts and opened a safety deposit box with the petitioner as a joint tenant. The petitioner put the stocks she received from Colin into the safety deposit box. Between 1987 and 1989, the decedent acquired other stocks, either purchased or through stock splits, in MAF Bancorp, Inc., Wheelabrator Technologies, Inc., MFS Charter Income Trust and St. Paul Bancorp, Inc.; the stocks were registered in the names of the petitioner and the decedent as joint tenants.

During 1990, the petitioner and the decedent also had a "falling out." The decedent removed the petitioner's name from her bank accounts and from access to the safety deposit box. She added Colin and the respondents as lessees of the safety deposit box. The petitioner refused to endorse the stock certificates so that her name would be removed as a joint tenant. In September 1990, the decedent filed an action in chancery, seeking to order the petitioner to endorse the shares or an order imposing a constructive trust on her "one-half" interest.

The decedent moved for summary judgment in the chancery action; she stated in her affidavit, "It was not my intention, in adding my children as joint owners, to confer upon them any present ownership but rather, to insure that said stock would pass to them upon my death." She also stated, "It is specifically not my desire that the stock pass to [petitioner] in its entirety in the event of my death"; the affidavit was dated November 1, 1991. The petitioner responded to the decedent's motion for summary judgment; in her affidavit, the petitioner stated that the "stocks, if not exhausted for the benefit of [the decedent's medical bills], would be compensation for services." The decedent died on March 20, 1992, and the chancery proceeding against the petitioner was not resolved. On the date of death, all stock certificates remained in the safety deposit box to which the petitioner could not gain access; only Colin and the respondents had access to the box.

On August 31, 1992, the petitioner filed a "Petition for Citation" to recover the stock certificates. The respondents answered that the decedent added the petitioner on the stocks as a matter of "convenience," for quick liquidation; that she had no intention of conveying "present ownership interest" to the petitioner; that the petitioner took the position in 1991 that the stocks were transferred as "compensation" not as a gift; that the decedent purchased all of the stock with her own funds; and that the decedent "revoked" the petitioner's interest in the stocks by filing the chancery action.

Attached to the respondents' answer was a copy of the decedent's will. According to the will, Colin was to receive "any and all stock or negotiable instruments not otherwise described herein, per stirpes and not per capita." The respondents were to receive $10,000 each from two CD's. The will also stated, "I specifically and intentionally make no provisions herein for the benefit of my daughter, Pamela Koldras, or any members of her family."

Before the evidentiary hearing on the petition began, the trial Judge noted that there was no dispute regarding title because the petitioner was the registered surviving joint tenant on the certificates and, therefore, the case should be treated as a recovery petition by the estate under section 16-1 of the Probate Act. (Ill. Rev. Stat. 1991, ch. 110 1/2, par. 16-1.) The trial Judge told the parties: "Since there is no dispute that this was stock in joint tenancy in compliance with the Statute, and she is the surviving tenant, she has the title[.] * * * The obligation, now, is encumbent [sic] upon the estate to show, for one reason or another, that this is not a true joint tenancy." The respondents' attorney agreed with the trial Judge and proceeded to introduce evidence.

The respondents first called the petitioner. She testified that she never removed the stock certificates and only went to place more stocks in the safety deposit box when her mother was "indisposed." Her mother never said that she added the petitioner as a joint tenant on the stocks so that she could quickly liquidate them if her mother became incapacitated. She understood that the stocks were to be used to pay for medical expenses and that, if they were not liquidated, then she would receive them. She signed the dividend checks until 1990; she never received any dividend proceeds from the stocks. She agreed that she took the position in 1991 that some stocks were "compensation" for caring for her mother; she added that some stocks predated 1986. Her mother never objected to the registration of the stocks in joint tenancy and never asked her to endorse them until 1990.

Melodie Waters, one of the respondents, testified that the decedent told her why the stocks were put in joint tenancy: "If she [the decedent] needed money, [the petitioner's] name was on there, she could give the stock certificates to Ed [petitioner's husband, a stock broker], and they could be cashed in." Petitioner's counsel objected on the ground that the statement violated the Dead Man's Act, but the trial Judge overruled the objection; he stated that it was admissible because the action proceeded under section 16-1 of the Probate Act. She ...


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