Appeal from theCircuit Court of Cook County. No. 10 CH 3428 HonorableKathleen M. Pantle, Judge Presiding.
The opinion of the court was delivered by: Justice Howse
JUSTICE HOWSE delivered the judgment of the court, with opinion.
Presiding Justice Epstein and Justice McBride concurred in the judgment and opinion.
¶ 1 Plaintiffs Andrew Faville and William Faville filed an amended complaint for declaratory and injunctive relief against defendant Martin Burns in the circuit court, alleging plaintiffs should be deemed descendants of Barbara Burns Faville for purposes of determining their rights under the terms of a trust agreement. Plaintiffs also requested the circuit court remove defendant as trustee of the trust agreement based on a conflict of interest as an adverse remainder beneficiary and a breach of fiduciary duty. Defendant filed a motion under section 2-615 of the Code of Civil Procedure (735 ILCS 5/2-615 (West 2010)) to strike the amended complaint. The trial court granted defendant's motion to strike on January 5, 2011.
¶ 2 On appeal, plaintiffs contend the trial court erred in dismissing their claims based on a determination that section 2-4(a) of the Illinois Probate Act of 1975 (755 ILCS 5/2-4(a) (West 2010), rather than section 2-4(f), applied with regard to whether plaintiffs were Barbara's descendants under the trust agreement. Plaintiffs also contend the trial court erred in dismissing their claim that defendant should be removed as trustee of the trust agreement. For the reasons that follow, we reverse the circuit court's order and remand the cause for further proceedings.
¶ 4 Barbara Faville's father, Martin Burns, died in 1939. He left behind a "Last Will and Testament" dated August 19, 1939, which divided his estate into three separate trusts---one for his wife Miriam Burns, one for his son Martin Burns and one for his daughter Barbara. After Miriam died, her trust was divided equally between Martin and Barbara. Barbara was the sole beneficiary of the trust created for her benefit and was entitled to receive the "net income" derived from the trust for the remainder of her life. The principal of the trust was reserved for the remainderman. Following her death, the trust agreement outlined the remaining corpus of the trust would pass "to her then living descendants per stirpes."
¶ 5 Barbara appointed Martin as trustee of her trust in 1978. Plaintiffs alleged that sometime after Martin was appointed as trustee the relationship between Martin and Barbara "deteriorated." Before her death, Barbara requested that Martin resign as trustee. He refused to do so. Barbara then sought to revoke her designation of Martin as successor trustee and appoint American Bank and Trust Co. of St. Charles (American Bank) in his place on February 16, 2009. Martin refused to transfer the trust property to American Bank. On May 5, 2009, Barbara legally adopted Andrew and William Faville, her adult stepchildren who were in their 50s, in Florida. Andrew's and William's birth certificates were amended to reflect Barbara as their adopted mother, and the brothers provided notice to Martin of their status as adopted children. Prior to the adoptions, Martin was considered the sole remainderman of the trust under the trust agreement's terms.
¶ 6 On January 26, 2010, Barbara filed a declaratory judgment action against Martin, seeking a declaration that she has the power under the trust agreement to remove Martin as trustee. The complaint also sought a declaration that her adopted children, Andrew and William, are her descendants for purposes of distributing the trust. After Barbara passed away on February 28, 2010, Andrew and William filed an amended complaint naming themselves as plaintiffs in the declaratory judgment action. Plaintiffs sought a declaration that they were Barbara's "descendants" under the trust agreement. Plaintiffs also sought Martin's removal as trustee and a preliminary injunction baring Martin dissipating the trust's assets prior to resolution of the action.
¶ 7 In support of their contention that Martin should be removed as trustee for good cause, plaintiff's noted Martin has "failed to produce sufficient income and has breached his fiduciary duties to the beneficiaries of the Trust." Plaintiffs alleged that instead of maximizing the investment potential of the trust assets, Martin had placed the assets in low-yielding accounts intended to preserve the trust's principal instead of maximizing investment returns. Plaintiffs also alleged Martin had a conflict of interest because he considers himself to be the sole remainderman of the trust, despite notice of Barbara's legal adoption of plaintiffs as her children.
¶ 8 Martin filed a section 2-615 motion to strike the amended complaint, alleging section 2-4(a) of the Act provides plaintiffs should not be considered Barbara's "descendants" for purposes of the trust agreement because they were adopted after attaining the age of 18 and never resided with the adopting parent before attaining the age of 18. Martin also contended plaintiffs' request to remove him as trustee should also be dismissed because plaintiffs had no standing and Martin had not breached his fiduciary duties as trustee.
¶ 9 Plaintiffs countered in their answer to the section 2-615 motion that section 2-4(f) of the Act, not section 2-4(a), should apply to the trust agreement because the instrument was created before September 1, 1955. Plaintiffs alleged that under section 2-4(f) of the Act, they should presumptively be considered Barbara's descendants for purposes of the trust agreement unless such a presumption could be rebutted by clear and convincing evidence.
¶ 10 The trial court granted Martin's motion to dismiss plaintiffs' claims, finding section 2-4(a), not section 2-4(f), of the Act applied to the claims because it is the more specific provision in the statute. The court also rejected plaintiffs' contention that section 2-4(a) only applies in situations where there is proof of an adoption done in bad faith, i.e., where the adult adoption was performed strictly for purposes of making the adoptee an heir. The trial court also determined count II did not state a valid cause of action under the prudent investor rule, finding there was no requirement the trustee produce "sufficient income" or maximize the investment potential of the trust assets. The court also noted plaintiffs had not alleged any facts to show Martin's conduct amounted to an abuse of the broad discretion granted to him under the trust agreement's terms. Plaintiffs appeal.
¶ 12 A section 2-615 motion to dismiss challenges the legal sufficiency of a complaint based on defects apparent on its face. 735 ILCS 5/2-615 (West 2010); City of Chicago v. Beretta U.S.A. Corp., 213 Ill. 2d 351, 364 (2004). In reviewing the sufficiency of a complaint, we construe the complaint's allegations in the light most favorable to the plaintiff. King v. First Capital Financial Services Corp., 215 Ill. 2d 1, 11-12 (2005). We also accept as true all well-pleaded facts and all reasonable inferences that may be drawn from those facts. Beretta U.S.A Corp., 213 Ill. 2d at 364. A claim should not be dismissed unless it is clearly apparent that no set of facts can be proven that would entitle the plaintiff to recovery. Canel v. Topinka, 212 Ill. 2d 311, 318 (2004).
¶ 13 We review a trial court's grant of a section 2-615 motion to dismiss de novo. Chandler v. Illinois Central R.R. ...