Nace v. Nace

2024 IL App (4th) 231300-U

• Court: Appellate Court of Illinois
• Decided: May 23, 2024
• Docket: 4-23-1300
• Status: Unpublished

Opinion

NOTICE 2024 IL App (4th) 231300-U This Order was filed under FILED NO. 4-23-1300 May 23, 2024 Supreme Court Rule 23 and is Carla Bender not precedent except in the 4th District Appellate limited circumstances allowed IN THE APPELLATE COURT Court, IL under Rule 23(e)(1). OF ILLINOIS

FOURTH DISTRICT

MICHAEL E. NACE, ) Appeal from the Plaintiff-Appellant, ) Circuit Court of v. ) Marshall County TERESA ANN NACE, Individually and as Purported ) No. 20CH11 Trustee of the Nace Family Farm Irrevocable Trust Dated ) December 26, 2012; STEVEN P. NACE; DUSTIN ) NACE; SCOTT NACE; NICOLE NACE LAFFERTY; ) JAMES NACE; CHRISTOPHER NACE; MATT NACE; ) and THE BOARD OF DIRECTORS OF THE ) Honorable UNIVERSITY OF ILLINOIS, ) James A. Mack, Defendants-Appellees. ) Judge Presiding.

JUSTICE LANNERD delivered the judgment of the court. Justices Harris and Doherty concurred in the judgment.

ORDER ¶1 Held: The appellate court affirmed, concluding the trial court properly granted the defendant trustee’s motion for summary judgment based on the equitable principle of laches.

¶2 Plaintiff, Michael Nace, appeals from an order of the Marshall County circuit

court granting a motion for summary judgment in favor of defendants, Teresa Ann Nace,

individually and as purported trustee of the Nace Family Farm Irrevocable Trust Dated

December 26, 2012; Steven P. Nace; Dustin Nace; Scott Nace; Nicole Nace Lafferty; James

Nace; Christopher Nace; Matt Nace; and the Board of Directors of the University of Illinois. On

appeal, Michael asserts the trial court erred when it allowed summary judgment on the grounds of both laches and unclean hands, and therefore the judgment should be reversed and remanded

for further proceedings. Defendants respond summary judgment was appropriate, and the

judgment should therefore be affirmed. We affirm.

¶3 I. BACKGROUND

¶4 A. Trusts and Complaint

¶5 William Nace died on March 20, 2005, after which the William R. Nace Trust

Dated January 14, 2004 (William’s Trust), held title to: (1) three tracts of real estate located in

Marshall County (Recreational Ground); (2) a house located at 3322 N. Isabell Avenue in Peoria,

Illinois (Peoria house); and (3) other real property. William’s Trust is divided into a family trust

for the benefit of his children and a marital trust for the benefit of Muriel Ann Nace, his spouse.

Section 5.2 of William’s Trust provides that the trustee, who in August 2007 was Muriel,

“may pay to [Muriel] as much of the principal as the Trustee from time to time

considers necessary for the health or maintenance in reasonable comfort of my

spouse. I recommend that the trustee make no payment of principal to my spouse

if any part of the principal of the Marital Trust is reasonably available for those

purposes.”

¶6 On August 7, 2007, Muriel, in her capacity as trustee of William’s Trust, executed

and recorded a trustee’s deed with the Marshall County Recorder (2007 Deed), which conveyed

title to all three tracts of the Recreational Ground to Muriel, individually. The Recreational

Ground is also commonly known as the Nace Family Farm and contains about 400 acres, mostly

of timber but also including some tillable acres. Thereafter, Muriel conveyed title to the

Recreational Ground as follows:

-2- “a. A 100% interest in Tracts I and II were conveyed to the [Nace Family

Farm Irrevocable Trust dated December 26, 2012 (Farm Trust)], pursuant to a

Warranty Deed in Trust dated December 26, 2012, recorded with the Marshall

County Recorder as Document No. 201200002582 on December 27, 2012 (the

‘Farm Deed’); and

b. A 100% interest in Tract III was conveyed to Michael pursuant to a

Trustee’s Quit Claim Deed dated January 2, 2014, recorded with the Marshall

County Recorder as Document No. 201400000028 on January 8, 2014

(‘Michael’s Deed’).”

¶7 Although William’s Trust directed the Peoria house be distributed to Teresa Nace

upon Muriel’s death, Muriel transferred the Peoria house to Michael pursuant to a trustee’s deed

dated August 3, 2017, recorded with the Marshall County Recorder as document No.

2017017080 on August 22, 2017. Michael did not object to any of the aforementioned transfers

at the time they were conveyed.

¶8 As a result of the transfer of Tracts I and II to the Farm Trust, which has a

charitable remainder beneficiary, Muriel recognized a $1,065,553 charitable deduction and was

admitted as a member of the Laureate Circle of the President’s Council of the University of

Illinois Foundation. According to an affidavit filed by Teresa, since the recording of the Farm

Deed in 2012, the Farm Trust has been in possession of Tracts I and II, exerting control over

such real property by virtue of: “(i) establishing rules for the use thereof; (ii) performing

maintenance thereon; and (iii) controlling access thereto.” As of the dates of filing his complaint

and his amended complaint, Michael was not in possession of Tracts I and II. Specifically, the

-3- Peoria County circuit court suspended Michael’s access from April 12, 2019, through April 11,

2022, in Peoria County Case No. 18-CH-326.

¶9 Additionally, the Farm Trust provides all three of Muriel’s children and their

children (Muriel’s grandchildren) life estates in Tracts I and II of the Recreational Ground for

“their recreation and enjoyment.” Upon the death of the last of Muriel’s children and

grandchildren, the Farm Trust grants the remainder interest to the Board of Trustees of the

University of Illinois for “conservation, ecological and environmental research, education and

outreach activities.” Muriel died on June 18, 2018.

¶ 10 On July 7, 2020, Michael initiated the instant case against Teresa, individually

and as trustee of the Farm Trust, as well as the other beneficiaries of the Farm Trust. In a

one-count amended complaint filed on April 16, 2021, Michael alleged a claim to quiet title to

real property that is owned by the Farm Trust, seeking to undo Muriel’s August 7, 2007, real

estate transfer. Specifically, Michael challenged the authority of Muriel to transfer the 50%

undivided interest in the Recreational Ground that was owned by William’s Trust because at the

time William’s Trust was executed, William was the sole owner of all three tracts comprising the

Recreational Ground. Michael further alleged William never revoked or modified William’s

Trust during his lifetime. Accordingly, Michael sought a declaration confirming at least a

one-half undivided interest in the Recreational Ground remains in William’s Trust, which has

become irrevocable, and cannot be presently or retroactively transferred by Muriel as trustee

because she did not need the principal and interest for her health or maintenance in reasonable

comfort, especially since her death in June 2018. Michael therefore asserted the Recreational

Ground is now held in tenancy in common for Michael and his two siblings, Teresa and Steven.

-4- Alternatively, Michael asserted he is a tenant in common with Teresa and Steven as well as the

Nace Family Farm Irrevocable Trust.

¶ 11 B. Summary Judgment

¶ 12 On May 5, 2023, both Michael and defendants filed cross-motions for summary

judgment. In defendants’ motion, they asserted (1) Michael could not satisfy the elements of his

quiet title claim and (2) even if Michael could establish a claim to quiet title, equitable principles

prohibited Michael from obtaining the relief requested. On June 26, 2023, the trial court entered

a written order granting defendants’ motion for summary judgment and denying Michael’s. In its

order, the court stated it granted defendants’ motion on the grounds of laches and unclean hands.

Michael filed a motion to reconsider, asserting the equitable principles of laches and unclean

hands were not applicable and did not compel a judgment in defendants’ favor. The court denied

the motion.

¶ 13 This appeal followed.

¶ 14 II. ANALYSIS

¶ 15 On appeal, Michael argues the trial court erred when it granted defendants’

motion for summary judgment. Specifically, Michael argues (1) the equitable principle of laches

did not preclude his quiet title claim because defendants did not demonstrate prejudice and

(2) the equitable principle of unclean hands did not preclude his quiet title claim because

defendants did not demonstrate he engaged in any wrongdoing. Defendants respond the court’s

judgment was proper on the grounds of both laches and unclean hands. We affirm.

¶ 16 A. Standard of Review

¶ 17 Summary judgment is governed by section 2-1005 of the Code of Civil Procedure

(735 ILCS 5/2-1005 (West 2022)). “ ‘The purpose of summary judgment is not to try a question

-5- of fact, but rather to determine whether a genuine question of material fact exists.’ ” Banks v.

City of Rockford, 2023 IL App (4th) 221111, ¶ 15 (quoting Bagent v. Blessing Care Corp., 224

Ill. 2d 154, 162 (2007)). Accordingly, summary judgment is appropriate only where “the

pleadings, depositions, and admissions on file, together with the affidavits, if any, show that

there is no genuine issue as to any material fact and that the moving party is entitled to a

judgment as a matter of law.” 735 ILCS 5/2-1005(c) (West 2022). In making this determination,

the trial court must construe all well-pleaded facts against the moving party and in favor of the

nonmoving party. See Bagent, 224 Ill. 2d at 162. Furthermore, “[a] triable issue precluding

summary judgment exists where the material facts are disputed or where, the material facts being

undisputed, reasonable persons might draw different inferences from the undisputed facts.” Id. at

163. This court reviews the court’s granting or denial of a motion for summary judgment

de novo. Id.

¶ 18 B. Laches

¶ 19 On appeal, Michael argues the trial court erred when it granted defendants’

summary judgment motion on laches grounds because defendants—in particular, Teresa—failed

to demonstrate prejudice resulting from his delay in bringing this action.

¶ 20 Our supreme court recently explained the equitable doctrine of laches as follows:

“Laches is an equitable defense asserted against a party ‘who has knowingly slept

upon his rights and acquiesced for a great length of time, [citation] and its

existence depends on whether, under all circumstances of a particular case, a

plaintiff is chargeable with want of due diligence in failing to institute

proceedings before he did.’ [Citation.] In contrast to a statute of limitations, which

forecloses an action based on a simple lapse of time, laches turns on ‘the inequity

-6- of permitting the claim to be enforced, an inequity founded upon some change in

the condition or relation of the property and parties.’ [Citation.] ‘The doctrine is

grounded in the equitable notion that courts are reluctant to come to the aid of a

party who has knowingly slept on his rights to the detriment of the opposing

party.’ [Citation.] There are two fundamental elements of laches: (1) ‘lack of due

diligence by the party asserting the claim’ and (2) ‘prejudice to the opposing

party.’ [Citation.] Whether laches is applicable depends on the facts and

circumstances of each case. [Citation.]” Tillman v. Pritzker, 2021 IL 126387,

¶ 25.

¶ 21 We first note Michael does not challenge that the first element has been met—i.e.,

he failed to act with due diligence in bringing his claim. Because the parties do not dispute

Michael waited 13 years to challenge the 2007 real estate transfer he now seeks to undo, we

conclude Michael failed to act with due diligence. Accordingly, this court focuses its analysis

only on the second element—i.e., whether defendants demonstrated prejudice as a result of

Michael’s delay in bringing his claim.

¶ 22 In our de novo review, we conclude the trial court properly granted defendants’

summary judgment motion on laches grounds. First, Teresa, individually and as a representative

of the Farm Trust, was prejudiced by Michael’s 13-year delay in asserting his quiet title claim

because in the interim, the key witness—Muriel—has died. Muriel died in 2018, which was still

over a decade after the August 2007 real estate transfer Michael now challenges. See Federal

National Mortgage Ass’n v. Altamirano, 2020 IL App (2d) 190198, ¶ 22 (citing James v. Frantz,

21 Ill. 2d 377 (1961) (holding death of a witness who was essential to defendants’ case was

relevant to laches analysis)). As a result of Muriel’s death, Teresa, as trustee of the Farm Trust,

-7- cannot adequately present evidence of Muriel’s “health or maintenance in reasonable comfort”

needs and defend Muriel’s August 2007 and subsequent conveyances involving the Recreational

Ground. Although Michael claims in his brief that Teresa has only demonstrated prejudice to

Muriel, the record shows Teresa has suffered prejudice both as a beneficiary and trustee of the

Farm Trust. As trustee, Teresa has administered the Farm Trust and taken actions consistent with

its ownership and maintenance of Tracts I and II of the Recreational Ground since the execution

of the Farm Deed in 2012. Specifically, the Farm Trust has incurred costs relevant to that

ownership in the form of maintenance and establishing rules and regulations related to its use.

Furthermore, in the decade since executing and recording the 2007 Deed, Muriel recognized a

$1,065,553 charitable tax deduction, along with other benefits. Those benefits would have to be

set aside, if possible—and may have other tax implications—if Michael were granted the relief

he requests. Accordingly, we conclude there is no genuine issue of material fact and defendants

demonstrated prejudice resulting from Michael’s delay in asserting his quiet title claim, and

therefore the court properly granted defendants’ summary judgment motion on laches grounds.

¶ 23 Because we conclude summary judgment in favor of defendants was proper based

on the equitable doctrine of laches, we need not consider Michael’s contention the trial court

erred in finding summary judgment was appropriate on the grounds of unclean hands.

¶ 24 III. CONCLUSION

¶ 25 For the reasons stated, we affirm the trial court’s judgment.

¶ 26 Affirmed.

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