Appeal from Circuit Court of Sangamon County. No. 95P180. Honorable Leo J. Zappa, Jr., Judge Presiding.
Released for Publication December 16, 1997.
Honorable Robert W. Cook, J., Honorable Robert J. Steigmann, P.j. - Concur, Honorable John T. McCullough, J. - Concur. Justice Cook delivered the opinion of the court.
The opinion of the court was delivered by: Cook
The Honorable Justice COOK delivered the opinion of the court:
Michael G. Downey, the decedent, and Cynthia Downey had three children, Brian, Aron, and Evan, the claimants appellants herein. Michael and Cynthia were divorced on February 8, 1991. Their judgment of dissolution contained the following paragraph:
"D. That petitioner and respondent will maintain life insurance policies on themselves and shall name the children of the parties as irrevocable beneficiaries until such time as the youngest child has reached his 18th birthday."
The record does not indicate whether paragraph D was the result of an agreement by the parties or whether it was ordered by the court on its own initiative.
At the time of the judgment, Michael had two group life insurance policies in the total face amount of $55,000 through his employer, the Highland, Illinois, school district. In the fall of 1992, Michael left his employment with the school district to attend nursing school, resulting in the termination of the two group policies. In December 1992, Michael purchased a life insurance policy in the face amount of $300,000 from the Valley Forge Life Insurance Company. Michael had married Louella Downey, the executor herein, in June 1991, and he originally designated Louella as the primary beneficiary of the $300,000 policy, with his children as contingent beneficiaries. Louella testified the designation was a mistake, and, shortly after receipt of the policy, Michael changed the designation so that Louella would receive two-thirds of the policy amount and his children would receive one-third.
In April 1994, Michael was diagnosed with cancer. At that time, in connection with the execution of a will, he changed the beneficiary of the $300,000 policy to his estate. His will, dated April 28, 1994, provided that Cynthia be paid a portion of the policy proceeds in "the amount necessary to fund the balance of the child support obligation I would have at the time of my death under the existing Court Order in cause # 91-D-47." The residue of the estate was left one-third to the children and two-thirds to Louella. Each child's share was left in trust, with Louella as trustee, until the child reached age 21. The trustee was allowed a fee not to exceed 5% of the annual trust income. Except for the amounts she received as child support, Cynthia was not to have any control over any part of Michael's estate. In December 1994 Michael exercised his right under the $300,000 policy to purchase additional insurance, a separate policy in the amount of $150,000.
Michael died March 8, 1995, and Louella was appointed his executor. At the time of Michael's death, all three children were minors, in the custody of Cynthia. Louella declined to act as trustee of the children's trust and the First National Bank of Central Illinois was appointed by the court to act in her place. The inventory listed (1) the policy proceeds, (2) household furnishings and personal effects worth $1,000, (3) silver worth $2,616.50, and (4) five shares of McCulloch Oil Corporation stock of unknown value. Michael and Louella's residence was titled in Louella's name alone and not inventoried. Louella filed a current account that showed $472,117.84 in receipts (including $453,540.65 from the Valley Forge Life Insurance Company) and $119,613.92 in disbursements (including $103,205.73 to Louella's mother to pay off a loan secured by the residence). The report was approved by the trial court.
The trial court ordered that each of the children receive $5,000 of the assets of the estate as a surviving child's award. See 755 ILCS 5/15-2 (West 1994). Brian's $5,000 was ordered paid to him directly, as he had attained the age of majority. Aron's and Paul's awards were to be paid to Cynthia, as their guardian and next friend. The trial court also ordered that "the children are entitled to a total amount of back [actually future] child support in the amount of $7,250." See 750 ILCS 5/510(d) (West 1994).
Cynthia, as mother and next friend of the children, filed a claim in the estate. In a memorandum in support of that claim, Cynthia argued that the children were entitled to the entire proceeds of the $300,000 policy and the proceeds of the $150,000 policy as well. Cynthia also argued that the proceeds should not be held in the children's trust created by the will. Cynthia later abandoned any claim to the proceeds of the $150,000 policy. It is interesting to note that under Michael's will the children will receive one-third of Michael's entire estate, including the $150,000 policy, although that amount will be subject to debts of the estate and must be held for a period of time in the children's trust. Cynthia, on behalf of the children, appeals the trial court's order that the children were entitled only to one-third of the $300,000 policy, and that those proceeds should be placed in the children's trust. We affirm.
Section 15-2 of the Probate Act of 1975 provides for a surviving child's award in the amount of $5,000. 755 ILCS 5/15-2 (West 1994). A court in a dissolution of marriage case does not have the power to increase that amount. A court in a dissolution of marriage case does not have the power to order that a parent leave a certain amount of property to his child by will. In re Marriage of Bush, 191 Ill. App. 3d 249, 262, 547 N.E.2d 590, 597, 138 Ill. Dec. 423 (1989) ("an unlawful court-ordered inheritance"); In re Marriage of Rogliano, 198 Ill. App. 3d 404, 416, 555 N.E.2d 1114, 1121-22, 144 Ill. Dec. 595 (1990). Provisions for child support, however, are not terminated by the death of a parent obligated to support the child (750 ILCS 5/510(d) (West 1994), and the court may order assets set aside "in a separate fund or trust for the support, maintenance, education, and general welfare of any minor, dependent, or incompetent child." 750 ILCS 5/503(g) (West 1994). Postmajority support is possible under the Illinois Marriage and Dissolution of Marriage Act. 750 ILCS 5/513 (West 1994). Under these authorities, the court may require a spouse who was ordered to provide child support to secure the continuation of such support by maintaining certain life insurance policies and naming the child as irrevocable beneficiary of such policies. See In re Marriage of Clarke, 125 Ill. App. 3d 432, 436-37, 465 N.E.2d 975, 978, 80 Ill. Dec. 629 (1984) (holding that a court could not order life insurance to secure maintenance); cf. In re Marriage of Vernon, 253 Ill. App. 3d 783, 788-89, 625 N.E.2d 823, 827-28, 192 Ill. Dec. 668 (1993). Even where the court has no power to order that life insurance be maintained, the parties may voluntarily agree to do so. The parties do not dispute that the court had the power to enter paragraph D in this case.
A number of cases have addressed the situation where a beneficiary designation is not changed after the dissolution of marriage. A former spouse who is the designated beneficiary on an insurance policy is not barred from collecting the proceeds upon the death of the insured merely because they have divorced. Allen v. Allen, 226 Ill. App. 3d 576, 582, 589 N.E.2d 1133, 1137, 168 Ill. Dec. 733 (1992). Nevertheless, a property settlement agreement, or a reference to life insurance in a judgment of dissolution, may limit or terminate a former spouse's right even without a change of beneficiary where such limitation or termination is sufficiently specific. Allen, 226 Ill. App. 3d at 584-85, 589 N.E.2d at 1139; Principal Mutual Life Insurance Co. v. Juntunen, 189 Ill. App. 3d 224, 226, 545 N.E.2d 224, 225, 136 Ill. Dec. 700 (1989); O'Toole v. Central Laborers' Pension & Welfare Funds, 12 Ill. App. 3d 995, 997, 299 N.E.2d 392, 393-94 (1973). See also 760 ILCS 35/1(a)(1994) (dissolution of marriage ...