NO. 4-06-0407 Filed 1/9/07
IN THE APPELLATE COURT
OF ILLINOIS
FOURTH DISTRICT
In re: the Estate of MARCELLA T. ) Appeal from LASHMETT, ) Circuit Court of Deceased, ) Scott County CHERYL LASHMETT THOMAS, ) No. 00P4 Petitioner-Appellee, ) v. ) Honorable CHRISTINE LASHMETT MONTGOMERY, ) James W. Day, Respondent-Appellant. ) Judge Presiding.
JUSTICE APPLETON delivered the opinion of the court:
This appeal arises from a citation to discover assets
filed by the executor of the estate of Marcella T. Lashmett.
Following an evidentiary hearing, the trial court found that the
respondent to the citation proceedings was indebted to the estate
and entered judgment in favor of the estate. We affirm.
I. BACKGROUND
Marcella T. Lashmett died testate on December 19, 1999.
Her heirs at law were her two daughters, Cheryl Lashmett Thomas
and Christine Lashmett Montgomery. The will named Christine as
executor, but as the named executor took no action to open an
estate, Cheryl filed a petition to admit the will to probate and
was appointed as personal representative. She commenced citation
proceedings against her sister shortly thereafter. The order at
issue here is the result of an amended citation to discover
assets filed on December 16, 2005. During her lifetime, Marcella was engaged in the
business of farming with her husband, who predeceased her.
Christine also was engaged in farming. At some point, after the
demise of Marcella's husband and prior to Marcella's death,
Christine frequently borrowed farm equipment belonging to
Marcella. On more than one occasion, Marcella's farm equipment
was used as a trade-in on the purchase of new equipment titled in
Christine's name alone. As each transaction was completed,
Christine and her mother would agree on an amount of monetary
compensation to be paid by Christine to Marcella. This course of
dealing was established not only by the evidence adduced at the
hearing on the citation but also by the provisions of Marcella's
last will and testament executed on March 20, 1998.
Article III of Marcella's will described the course of
dealings had between she and Christine:
"THIRD: FARM MACHINERY AND EQUIPMENT: At
my death, I may own certain items of farm
machinery and equipment which my late
husband, James Lashmett, Jr., and I have used
in our previous farming operation. I have
allowed my daughter, Christine Lashmett
Montgomery, to use this machinery in her
farming operation. Also, I have periodically
consented to allow the said Christine
- 2 - Lashmett Montgomery to trade various items of
said farm machinery and equipment for new
equipment which she has purchased for her own
farming operation and in her own name, and I
have received the fair market value of my
machinery traded for newer machinery and
equipment. In each of these said trades, I
have realized the full market value of said
machinery and equipment as it was disposed of
by me in said trades. In the event that I
still own any item of farm machinery and
equipment at my death, I hereby bequeath unto
Christine Lashmett Montgomery, any and all
items of said farm machinery and equipment;
provided, however, that in the event the said
Christine Lashmett Montgomery disposes of or
trades any such item or items of farm
machinery and equipment, as determined by the
said Christine Lashmett Montgomery, in the
sale or trade, shall be divided equally
between my two daughters, Cheryl Lashmett
Thomas and Christine Lashmett Montgomery, per
stirpes."
In 1993, Marcella suffered health problems requiring
- 3 - her hospitalization. At that time, she gave a power of attorney
to Christine. On September 28, 1997, Marcella subsequently
executed a new power of attorney in favor of Christine, including
a power for health care. The evidence does not show that
Christine ever used either powers of attorney except to pay her
mother's bills during the times Marcella was hospitalized.
In September 1999, some three months before Marcella's
death, Christine used a tractor belonging to Marcella as a trade-
in for the purchase by Christine of a new tractor. The trade-in
credit generated was $55,296.28. No money was paid to Marcella.
Christine testified that she tried to pay her mother $20,000 for
the use of the tractor as a trade-in and, in fact, provided at
the hearing on the citation a check in that amount marked "void."
Christine testified she voided the check after Marcella refused
any payment for the old tractor.
The trial court granted the citation and, after hearing
evidence, found that Christine was indebted to the estate in the
amount of $55,296.28. Christine's motion for reconsideration was
denied. This appeal followed.
II. ANALYSIS
Christine raises the following issues for review: (1)
whether the citation was filed outside the applicable statute of
limitations; (2) whether the citation improperly sought to
recover a debt; (3) whether the decision of the trial court was
- 4 - against the manifest weight of the evidence; and (4) whether the
trial court erred in ordering Christine to pay a sum certain into
the estate rather than awarding the estate an interest in the
tractor. As to issues one, two, and four, our review is de novo
as resolution of them involves purely questions of law. See
Illinois Farmers Insurance Co. v. Marchwiany, 222 Ill. 2d 472,
476, 856 N.E.2d 439, 441 (2006). As to issue three, a manifest-
weight standard is applied. See White v. Raines, 215 Ill. App.
3d 49, 60, 574 N.E.2d 272, 280 (1991).
Before addressing each of respondent's arguments on
appeal, it is helpful to set forth some basic principles of
probate law and practice. While Illinois has codified the laws
of descent and distribution, as well as the procedures for the
administration of decedents' estates in the Probate Act of 1975
(Probate Act) (755 ILCS 5/1-1 through 30-3 (West 2004)), the
relationship between the court, the estate, and the parties was
known at common law. We rely on those principles to understand
both the relationship between the court and the parties as well
as the inherent powers and duties of each.
The circuit court, sitting in probate, performs the
duties of a probate court as the same was known prior to the
adoption of the judicial article effective January 1, 1964. See
Ill. Const. 1870, art. VI, §20, and Ill. Const. 1970, art. VI,
§9. The court is ultimately in control of the estate, not the
- 5 - personal representative. The personal representative in the
collection and management of the estate is an agent of the court
subject to the court's control and direction. The powers of the
representative are derivative of the court's power in such a way
that the representative acts as an agent of the probate court
with legal duties to the court and fiduciary duties to the
estate.
"The remedy furnished by the Probate Act
for the recovery of property of the deceased
or the discovery of information relating to
the property is cumulative[] and was designed
to be more expeditious and less expensive
than the ordinary proceedings of detinue,
trover or replevin. Although it is neither
in law or equity, the citation proceeding
bears the equitable aspects of a bill for
discovery, in which it was necessary to sift
the conscience of the party charged and to
get at facts of which he or she alone could
have knowledge. The intention of the
legislature is to enable the court to compel
the person cited, to discover, on oath,
whether he or she has estate property in his
or her possession." 1A M. McElroy, Horner
- 6 - Probate Practice and Estates, §24.3, at 390-
91 (4th ed. rev. 2002).
Likewise, the citation procedure may be used repeatedly with
regard to the same subject matter. 1A M. McElroy, Horner Probate
Practice and Estates, §24.1, at 388 (4th ed. rev. 2002); Schwaan
v. Schwaan, 320 Ill. App. 287, 289, 50 N.E.2d 861, 862 (1943).
A. Statute of Limitations
Respondent argues that the amended citation filed by
the representative on December 13, 2005, is beyond the five-year
limitations period associated with "all civil actions not
otherwise provided for" found in section 13-205 of the Code of
Civil Procedure (735 ILCS 5/13-205 (West 2004)). The decedent
died on December 19, 1999, which date would normally mark the
beginning of the five-year period, if applicable.
The representative argues that the "amended" citation
is simply a revision of the citation filed by the representative
against Christine on February 18, 2000. That citation, however,
proceeded to hearing before the trial court on March 27, 2000.
At the conclusion of that hearing, the citation was discharged.
Because of that discharge, no pleading remained to amend. The
representative's contention (that the timeliness of the "amended"
citation is saved by a theory of relation back) must therefore
fail as there was nothing extant to which it could relate back.
This does not, however, end our inquiry. The nature of
- 7 - a citation on behalf of an estate pursuant to section 16-1 of the
Probate Act (755 ILCS 5/16-1 (West 2004)) is a vehicle by which
the court can order returned to the estate property of the
decedent that is wrongfully withheld from it. The trial court's
jurisdiction sitting in probate extends to all property of the
decedent, no matter where it may be found or when. As a
consequence of that jurisdiction, the statute of limitations
relied upon by respondent does not and cannot apply. To allow
the statute of limitations to bar the recovery of an asset of the
estate would serve to defeat the jurisdiction of the probate
court and effectively restrict the statutory and common-law power
of the court to supervise the administration and disposition of
estates. For that reason, respondent's argument must fail.
B. Use of a Citation To Collect a Debt
Respondent argues that the use of a citation on behalf
of an estate pursuant to section 16-1 of the Probate Act (755
ILCS 5/16-1 (West 2004)) is an inappropriate vehicle by which to
recover a debt. This argument is based on Johnson v. Nelson, 341
Ill. 119, 122, 173 N.E. 77, 79 (1930), wherein our supreme court
examined the jurisdiction of the probate court with regard to the
administration of estates, as established by the predecessor
statutes authorizing a citation proceeding (see Cahill's Stat.
1923, ch. 3, §81; Smith-Hurd Stat. 1923, ch. 3, §82). In
- 8 - substance, those predecessor statutes are identical to section
16-1.
Keeping in mind that the probate court in 1930 was a
court of limited, rather than general, jurisdiction (see Ill.
Const. 1870, art. VI, §20), the supreme court held:
"The power to determine questions of
title and rights of property and to enforce
by execution orders adjudicating titles or
requiring the delivery of property, added to
sections 81 and 82 by the amendatory act,
does not include jurisdiction of the ordinary
action for the recovery of money the title to
which is in the debtor. Where the relation
of debtor and creditor arises for money lent,
the debtor owns the money and is indebted to
the creditor for it, and consequently the
debtor has no money belonging to the
creditor, or to the latter's estate, in his
possession. To enforce collection of the
indebtedness in such a case, by the rendition
of a personal judgment against the debtor,
was not within the scope of sections 81 and
82 prior to July 1, 1925, and no such power
was conferred by the amendatory act, either
- 9 - expressly or by implication.
In the present case, the money was
delivered to the defendant in error by the
transfer to his credit in the bank[,] and the
title to the money vested in him. There is
no contention by either party that the father
continued to own the money after the transfer
was made. Whether the transaction resulted
in a loan, as the plaintiff in error argues,
or constituted a gift, as the defendant in
error insists, is for the present purpose
immaterial, for in either situation, no
question of title or of the recovery of
specific property belonging to the estate is
involved. Upon the view of the plaintiff in
error that a loan was made, for which[,] with
interest, the defendant in error is indebted
to the estate, the relation of debtor and
creditor merely was created and the summary
proceeding provided by section 81 is not
available. Obviously no opinion is expressed
upon the merits of this case, but if the
defendant in error is indebted to his
father's estate, the remedy is an action at
- 10 - law." Johnson, 341 Ill. at 125-26, 173 N.E.
at 80.
Resolution of this issue in the first instance requires us to
determine whether the claim for property made under the citation
here constitutes an attempt for collection of a debt or the
recovery of property.
Unlike the transfer of money to the decedent's son in
Johnson, where the money once transferred (whether by gift or
loan) became the property of the son, the issue presented by the
instant citation arises from the conversion of a tractor.
Whether the taking of the tractor by Christine and her use of it
for a trade-in on a new tractor was with or without the
decedent's consent, which was the ultimate issue presented for
decision by the trial court, it does not resolve the question of
whether the recovery of the converted asset constitutes the
collection of a debt.
In common parlance, when someone is said to owe money
or a thing to another, it is understood that the owing is a debt.
However, the use of the term "debt" for purposes of our analysis
is more fine. In Cox v. Rice, 375 Ill. 357, 362, 31 N.E.2d 786,
789 (1940), the court held that a circuit-court order, requiring
a former conservator to repay money that was invested without
court approval and suffer imprisonment for the failure to repay,
did not constitute a debt for purposes of the constitutional bar
- 11 - against imprisonment for debt. In other words, not all money
owed constitutes a debt in this sense. Rather, debt in the sense
as it is used in Johnson is an obligation to repay, which grows
out of a consensual transaction between the creditor and the
debtor. Cf. Kazubowski v. Kazubowski, 45 Ill. 2d 405, 408, 259
N.E.2d 282, 285 (1970), cert. denied, 400 U.S. 926, 27 L. Ed. 2d
186, 91 S. Ct. 188 (1970) (the defendant owed a "debt" that had
been court-ordered, not consensual, and was jailed in contempt
proceeding for a failure to pay).
It is noteworthy as well that the supreme court in
Johnson used as examples of debt the loan or gift of money,
either of which is a two-party transaction. While Christine
argues that her use of her mother's tractor as a trade-in was a
gift, the trial court found it was not. Rather, the trial
court's decision was based on a characterization of the
transaction as a conversion by Christine. The obligation to
return the corpus of a conversion is not a debt within the
limitation on the use of a citation described or contemplated by
the supreme court in Johnson. If Christine had physical
possession of the tractor and had not sold it, no issue of
whether her obligation to return the tractor constituted a "debt"
would arise. If, by her sole action, she converted the tractor
into cash, the obligation due from her to return to or repay the
estate does not change the character of the obligation owed by
- 12 - her. In such a case, a debtor-creditor relationship between
Christine and her mother did not exist. See In re Estate of
Willich, 338 Ill. App. 289, 297, 87 N.E.2d 327, 331 (1949); see
also In re Estate of La Rue, 53 Ill. App. 2d 467, 476, 203 N.E.2d
47, 51 (1964).
The personal representative also argues that an
exception to the rule in Johnson exists when the debtor is a
fiduciary. It is clear that Christine held a power of attorney
given by her mother some years prior to her death. As the holder
of the power, she had a fiduciary relationship with her mother.
See Apple v. Apple, 407 Ill. 464, 468-69, 95 N.E.2d 334, 337
(1950). As this court has previously noted in In re Baker, 117
Ill. App. 2d 332, 337, 253 N.E.2d 550, 552 (1969), there is an
exception to the general rule barring the use of a citation on
behalf of the estate to collect when the respondent was a
fiduciary to the decedent. See also La Rue, 53 Ill. App. 2d at
476, 203 N.E.2d at 51; Willich, 338 Ill. App. at 299, 87 N.E.2d
at 332. While there is no evidence that Christine used the power
of attorney given to her to accomplish the trade of the
decedent's tractor, she still owed a fiduciary duty to the
decedent. Under either analysis, respondent's argument fails.
C. Manifest Weight
Respondent argues that the trial court's decision is
against the manifest weight of the evidence. Particularly, she
- 13 - argues that her production of a check for $20,000 written to the
decedent marked "void" is evidence of her claim that she
attempted to pay her mother for at least a part of the tractor.
As a corollary, she argues the check is evidence of the
credibility of her testimony that the trade was accomplished with
the decedent's consent and that her mother did not want any
proceeds from the transaction.
The trial court is in the best position to evaluate the
credibility of the witnesses and to determine therefrom the facts
of the case. White, 215 Ill. App. 3d at 60, 574 N.E.2d at 280.
Its decision will not be overturned unless it is a against the
manifest weight of the evidence. White, 215 Ill. App. 3d at 60,
574 N.E.2d at 280. Here, the trial court had the testimony of
Christine, the alleged voided check, and some history of the
dealings between Christine and her mother as evidenced by article
III of the decedent's will. As a fiduciary to her mother, it was
respondent's burden to prove that the tractor used as a trade
constituted a gift. La Rue, 53 Ill. App. 2d at 476, 203 N.E.2d
at 51; In re Estate of Casey, 155 Ill. App. 3d 116, 122, 507
N.E.2d 962, 966 (1987).
In contravention of respondent's assertion is the
evidence that the decedent memorialized prior gifts to Christine
by the preparation and filing of a gift tax return. We note that
the sum of $55,296.28, given the gifts previously disclosed by
- 14 - the 1998 gift tax return, should have triggered the requirement
of a filing of a gift tax return for that amount as well. While
the decedent died prior to the date by which such a return should
have been filed, only one person had the necessary information to
generate the return at its due date: Christine. Her inaction is
as much evidence of whether the tractor transaction was a gift,
especially given her fiduciary relationship to her mother and the
estate, as anything else. We find there was sufficient evidence
upon which the trial court could base its decision to find
Christine failed to meet her burden of proof and to include the
proceeds of the trade-in in the estate.
D. Monetary Award
Respondent argues that since the decedent's tractor was
used to generate a trade-in credit on the purchase of a new
tractor, the estate should have been awarded a percentage
ownership of the new tractor rather than the monetary-trade value
in dollars. The difficulty with respondent's argument is that
once chattel is sold, as this tractor was by reason of conveying
it to the dealer of the new tractor, the res of the mother's
estate has changed from chattel to the monetary credit that
generated upon Christine's purchase of the new tractor. See In
re Estate of Swartz, 218 Ill. App. 449 (1920) (dispute regarding
estate's entitlement of chattel or the fair cash-market value of
the chattel). It is no different than if Christine had simply
- 15 - sold her mother's tractor for cash and kept it.
As respondent provides no legal authority in her brief
for her contrary position, we will follow the above analysis to
rule in favor of the estate as well.
III. CONCLUSION
For the foregoing reasons, we affirm the trial court's
judgment.
Affirmed.
McCULLOUGH and MYERSCOUGH, JJ., concur.
- 16 -