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Collins v. Noltensmeier

Court of Appeals of Illinois, Fourth District

April 5, 2018

KENNY COLLINS and LINDA RICHARD, Plaintiffs-Appellees,

          Appeal from Circuit Court of Cass County No. 11CH23 Honorable Bob G. Hardwick, Jr., Judge Presiding.

          PRESIDING JUSTICE HARRIS delivered the judgment of the court, with opinion. Justices Holder White and Steigmann concurred in the judgment and opinion.



         ¶ 1 Defendant, Patricia Noltensmeier, appeals from the trial court's order granting summary judgment in favor of plaintiffs, Kenny Collins and Linda Richard, who had sued defendant for a breach of fiduciary duty and conversion. Defendant claims she had the authority pursuant to a power of attorney for property to change decedent's beneficiaries from plaintiffs to herself. We affirm.

         ¶ 2 I. BACKGROUND

         ¶ 3 Defendant and Billy D. Collins were involved in a long-term romantic relationship when Billy died on January 23, 2011, at his home from a recently diagnosed terminal illness. Defendant had acted as Billy's caretaker. Approximately one week before he died, Billy executed a will and an Illinois Statutory Short Form Power of Attorney for Property. Each document was a preprinted form containing handwritten inserts in the blanks.

         ¶ 4 Billy's power of attorney, dated January 16, 2011, appointed defendant as his agent. Paragraph three of the document indicated the agent had the following powers, in addition to those listed previously: "power to make gifts, exercise powers of appointment, name or change beneficiaries under any beneficiary form or contractual arrangement."

         ¶ 5 Billy's will, also dated January 16, 2011, named defendant, his "domestic partner, " as the sole beneficiary of his real property, personal property, and the "rest, residue, and remainder" of his estate. He also named defendant as his executor.

         ¶ 6 Defendant filed Billy's will with the Cass County circuit court in March 2011. In May 2011, plaintiff Kenny Collins, Billy's brother, filed a petition to contest the validity of Billy's will in Cass County case No. 11-P-15, alleging Billy was of unsound mind, subjected to undue influence from defendant, and not told the document he was signing was a will.

         ¶ 7 Kenny and plaintiff Linda Richard, Billy's niece, filed a three-count complaint in the cause before us, alleging defendant (1) breached her fiduciary duty owed to Billy, (2) wrongfully converted Billy's individual retirement account (IRA) funds to herself, and (3) did so intentionally, willfully and wantonly, and with malice, and therefore was responsible for punitive damages. The case sat dormant for approximately four years.

         ¶ 8 In April 2015, plaintiffs filed a first amended complaint, alleging the same causes of action with the exception of the claim for punitive damages, which plaintiffs abandoned. Plaintiffs alleged defendant wrongfully and without authorization changed the beneficiary of Billy's IRA, valued at approximately $45, 000, from plaintiffs to herself. Defendant had completed the bank's change-of-beneficiary form by using her authority as the agent for Billy.

         ¶ 9 In May 2016, plaintiffs filed a motion for summary judgment, alleging defendant had engaged in fraudulent self-dealing. Plaintiffs claimed defendant breached her fiduciary duty because the added language in section three of the power of attorney did not authorize her to make the change of beneficiary to herself.

         ¶ 10 In July 2016, the trial court conducted a hearing on plaintiffs' motion for summary judgment. Both parties represented they had found no Illinois cases on point. Plaintiffs cited Bienash v. Moller, 721 N.W.2d 431 (S.D. 2006), a South Dakota case where, under similar factual circumstances, the court held that a power of attorney failed to specifically include language permitting the agent to name himself as a beneficiary. Therefore, the court held, the agent had breached his fiduciary duty to the principal by engaging in self-dealing. Bienash, 721 N.W.2d at 437.

         ¶ 11 In August 2016, the trial court entered a written order, granting plaintiffs' motion, finding no disputed facts remained, and holding, as a matter of law, that plaintiffs were entitled to a judgment in their favor. The court held:

"The power of self-dealing, i.e., to change the beneficiary to herself, was not included in paragraph [three] and defendant was therefore not entitled to make that change. The original designation of beneficiary form *** remains valid and [plaintiffs] are each 50% beneficiaries of that [IRA] at Petefish, Skiles and Company Bank."

         ¶ 12 In September 2016, defendant filed a motion to reconsider, claiming the trial court had overlooked or failed to recognize the added language in paragraph three, which, according to her, specifically authorized her to change the beneficiary ...

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