Northern Trust Co. v. Gibbs

636 N.E.2d 939, 263 Ill. App. 3d 1002, 201 Ill. Dec. 507
CourtAppellate Court of Illinois
DecidedJune 2, 1994
Docket1-92-4220
StatusPublished
Cited by4 cases

This text of 636 N.E.2d 939 (Northern Trust Co. v. Gibbs) is published on Counsel Stack Legal Research, covering Appellate Court of Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Northern Trust Co. v. Gibbs, 636 N.E.2d 939, 263 Ill. App. 3d 1002, 201 Ill. Dec. 507 (Ill. Ct. App. 1994).

Opinion

JUSTICE THEIS

delivered the opinion of the court:

Northern Trust Company, the successor trustee of the Lotta R. Stern Trust dated May 23, 1980, filed a petition to contest the 1989 will of Lotta R. Stern. Wanda Gibbs, executrix of the 1989 will, moved for summary judgment on this petition. (735 ILCS 5/2 — 1005 (West 1992).) The probate court granted Gibbs’ motion on October 20, 1992. We now reverse the decision of the lower court and remand this case for further proceedings consistent with this opinion.

FACTUAL BACKGROUND

On the sparse record before us, we note the following factual background. Lotta R. Stern executed a will on May 23, 1980. On that same date, she established the Lotta R. Stern Trust dated May 23, 1980 (hereinafter referred to as the Stern Trust). The will devised the residue of Lotta Stern’s estate to the acting successor trustee of the "Lotta R. Stern Trust Dated May 23, 1980, as in effect at my death” and named Lotta Stern as the trustee of the Stern Trust and the Northern Trust Company as the successor trustee. In essence, then, Lotta Stern created a pour-over will in 1980. Northern Trust was also named as the executor of this will.

In 1989, Lotta Stern apparently executed a second will which revoked the 1980 will and named Wanda Gibbs as executrix of the will. After Stern’s death, Northern Trust filed this petition to contest the validity of the 1989 will. In response, Gibbs filed a motion for summary judgment, contending that there was no issue of material fact and that Gibbs was entitled to judgment as a matter of law.

During a proceeding on a citation to discover assets issued against Northern Trust, the probate court entered an order on April 27, 1992, finding that the Stern Trust had terminated on May 12, 1988. Gibbs argued that, because the Stern Trust had terminated, Northern Trust no longer has an interest under the prior will and was therefore not an interested party who had standing to bring this action. The probate court granted Gibbs’ motion for summary judgment.

Northern Trust appeals this decision of the lower court. The central issue raised in this appeal revolves around whether section 4 — 4 of the Probate Act of 1975 (Probate Act) (755 ILCS 5/4 — 4 (West 1992)) affects the Stern Trust. In other words, is it possible that, if the 1989 will is found to be invalid, the Stern Trust could be revived pursuant to section 4 — 4?

ANALYSIS

The Meaning of Section 4 — 4

Section 4 — 4 of the Probate Act, entitled "Testamentary additions to trusts,” states, in part:

"If the trust is terminated prior to the testator’s death by revocation of the trust or by revocation of that portion of the instrument creating the trust, the bequest or appointment shall take effect according to the terms and provisions of the instrument creating the trust as they existed at the time of the termination, unless the testator’s will otherwise provides.” 755 ILCS 5/4 — 4 (West 1992).

The parties ask us to interpret this portion of the statute. Before we begin our analysis of the meaning of this section, however, we note that section 4 — 4 is based upon section 1 of the Uniform Testamentary Additions to Trusts Act (1960). (8B U.L.A. 465 (1993).) Most States which have adopted section 1 have statutes that provide that either termination or revocation of a trust shall cause the bequest to lapse. Several State statutes do, however, provide that termination of the trust does not cause the bequest to lapse, unless the termination is by way of revocation. (8B U.L.A. 465-75 (1993), providing annotations for statutes of the District of Columbia and Washington. See also annotations from Florida, Maryland, North Carolina, Pennsylvania, and Texas.) Illinois, then, is unique in that no other State provides for the revival of a trust when it is terminated by revocation. The question then becomes whether the statute in Illinois provides for the revival of a trust only when it has been terminated by revocation.

When interpreting the language of a statute, the primary rule of construction for this court to follow is to ascertain and give effect to the intention of the legislature. (Kraft, Inc. v. Edgar (1990), 138 Ill. 2d 178, 189, 561 N.E.2d 656, 661.) "The legislative intent should be sought primarily from the language used in the statute.” (Abrahamson v. Illinois Department of Professional Regulation (1992), 153 Ill. 2d 76, 91, 606 N.E.2d 1111, 1118.) Where the statutory language does not clearly reveal legislative intent, it is proper for a court to consider the legislative history of a statute. Antunes v. Sookhakitch (1992), 146 Ill. 2d 477, 484, 588 N.E.2d 1111, 1114.

Consequently, to discern legislative intent, we first turn to the language of the statute. Section 4 — 4 provides, "[i]f the trust is terminated *** by revocation of the trust or by revocation of that portion of the instrument creating the trust,” the bequest may nonetheless take effect. However, the statute also states that the trust shall take effect according to the terms of the trust which "existed at the time of the termination.” 755 ILCS 5/4 — 4 (West 1992).

Termination is a concept which is distinct from revocation. "A trust may be terminated before the expiration of its originally intended term in one of two ways, by revocation or by the exercise of a power of termination. Revocation is the resumption by the settlor of possession and title to the trust property, free of any obligation to the beneficiaries. A power of termination exists where a party other than the settlor, or the court, has the ability to cause the trust to cease and the trust property to be distributable to the settlor, the beneficiaries, or others.” (G. Bogert & G. Bogert, Trusts and Trustees § 998 at 273 (2d rev. ed. 1983).) Yet, "terminated *** by revocation” and "termination” are used virtually interchangeably in section 4 — 4. Such alternate use of these terms in the statute creates ambiguity.

Because of the ambiguity which we find in this statute, we cannot determine the intent of the legislature from looking to the plain language of section 4 — 4. We therefore turn to extrinsic aids for assistance, looking to the legislative history of this section of the Probate Act.

During debates presented in the legislature, Senator Maragos, who presented this bill to the Senate, stated that this legislation was designed to continue the intent of the testator and to prevent intestacy. (80th Ill. Gen. Assem., Senate Proceedings, June 23, 1977, at 284-87.) Armed with this clear statement of the intent of the legislature, we conclude that the language of section 4 — 4 should be construed in such a way as to prevent intestacy wherever possible.

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Bluebook (online)
636 N.E.2d 939, 263 Ill. App. 3d 1002, 201 Ill. Dec. 507, Counsel Stack Legal Research, https://law.counselstack.com/opinion/northern-trust-co-v-gibbs-illappct-1994.