Prospect Bank v. Meyer

2020 IL App (4th) 200074-U
CourtAppellate Court of Illinois
DecidedNovember 6, 2020
Docket4-20-0074
StatusUnpublished

This text of 2020 IL App (4th) 200074-U (Prospect Bank v. Meyer) 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
Prospect Bank v. Meyer, 2020 IL App (4th) 200074-U (Ill. Ct. App. 2020).

Opinion

NOTICE Rule 23 filed November 6, 2020 This order was filed under Supreme 2020 IL App (4th) 200074-U Court Rule 23 and may not be cited as precedent by any party except in Modified upon denial of NO. 4-20-0074 Rehearing December 2, 2020 the limited circumstances allowed under Rule 23(e)(1). IN THE APPELLATE COURT

OF ILLINOIS

FOURTH DISTRICT

PROSPECT BANK, as Successor Trustee for the H.T. ) Appeal from the Bell Farm Trust, ) Circuit Court of Plaintiff-Appellee, ) Douglas County v. ) No. 19MR47 DANIEL P. MEYER; MICHAEL W. MEYER; JEAN M. ) KAHN; JAMES C. MEYER; ANNA K. McGILLEN; ) JACILYN M. MANZELLA; SHRINERS HOSPITALS ) FOR CHILDREN, a Nonprofit Organization; SHRINERS ) HOSPITALS FOR CHILDREN-ST. LOUIS, a Nonprofit ) Organization; and THE PEOPLE OF THE STATE OF ) ILLINOIS ex rel. KWAME RAOUL, Attorney General of ) Illinois, ) Defendants ) (Daniel P. Meyer, Michael W. Meyer, Jean M. Kahn, ) James C. Meyer, Anna K. McGillen, and Jacilyn M. ) Manzella, Defendants-Appellants, and Shriners Hospitals ) Honorable for Children and Shriners Hospitals for Children-St. Louis, ) Wm. Hugh Finson, Defendants-Appellees). ) Judge Presiding.

JUSTICE TURNER delivered the judgment of the court. Justices Knecht and Harris concurred in the judgment.

ORDER

¶1 Held: The circuit court properly granted plaintiff a declaratory judgment declaring testatrix’s will with its two codicils did not grant defendants-appellants a long-term or lifetime leasehold interest in the Trust’s farmland, but the court erred by granting a declaratory judgment on the other declarations requested by plaintiff.

¶2 In August 2019, plaintiff, Prospect Bank, as successor trustee for the H.T. Bell

Farm Trust (Trust), which was established by the last will and testament (as amended by the first

and second codicils) of Mary Lou McGrew (testatrix), filed a complaint for a declaratory judgment against defendants, Daniel P. Meyer; Michael W. Meyer; Jean M. Kahn; James C.

Meyer; Anna K. McGillen; Jacilyn M. Manzella; Shriners Hospitals for Children, a nonprofit

organization; Shriners Hospitals for Children-St. Louis, a nonprofit organization; and the People

of the State of Illinois ex rel. Kwame Raoul, Attorney General of the State of Illinois. Daniel P.

Meyer, Michael W. Meyer, Jean M. Kahn, James C. Meyer, Anna K. McGillen, and Jacilyn M.

Manzella (collectively the Meyer siblings) are the adult children of Wayne N. Meyer, who are

mentioned in testatrix’s second codicil to her last will. Shriners Hospitals for Children and

Shriners Hospitals for Children-St. Louis (collectively Shriners defendants) are the Trust’s

charitable beneficiaries. Plaintiff sought a judgment declaring the following: (1) testatrix’s will

and its codicils do not grant Wayne or any of his children, including Daniel, a long-term or

lifetime leasehold interest in the Trust’s farmland; (2) the current lease between the Trust and

Daniel, which runs for one year and expires on March 1, 2020, may be terminated or

nonrenewed in accordance with its terms; and (3) any sale of the Trust’s farmland is subject only

to the farm lease’s current term ending on March 1, 2020, and the farm lease may be terminated

thereafter. In October 2019, Shriners defendants filed a motion for judgment on the pleadings in

favor of plaintiff. After a January 2020 hearing, the Douglas County circuit court entered a

written order granting Shriners defendants’ motion and entering the declaratory judgment

requested by plaintiff.

¶3 The Meyer siblings appeal, asserting (1) the farm lease cannot nullify testatrix’s

testament and (2) testatrix’s testamentary intent controls. We affirm in part and vacate in part.

¶4 I. BACKGROUND

¶5 Testatrix executed her last will and testament at issue in this case on May 24,

1991. In September 1992, she executed a first codicil to her 1991 will in which she revoked the

-2- third section of her 1991 will and replaced it with language establishing the Trust and devising

all of her farm real estate to the Trust, which included the farm leased by Daniel. (Given the

Trust at issue is a testamentary one created by the first codicil and later amended by a second

codicil, we refer to the Trust’s language and the codicils’ language interchangeably.) The Trust

was a charitable remainder unitrust with Shriners Hospitals for Children as the charitable

beneficiary. The first codicil specified that, after the death of testatrix’s sister, Harriet Bell, the

Trust’s income was to be used for Shriners Hospitals for Children’s hospital located in St. Louis,

Missouri. At that time, the trustee was to pay Shriners defendants all of the Trust’s net income in

quarterly installments. Additionally, paragraph (A)(6) of the Trust addressed prohibited

transactions and stated the following:

“The Trustee shall make distributions at such time and in such manner as not to

subject the Trust to tax under section 4942 of the [Internal Revenue] Code [(26

USC § 4942 (1988))]. Except for the payment of the unitrust amount to the

Recipient, the Trustee shall not engage in any act of self-dealing, as defined in

section 4941(d) [(26 USC § 4941(d) (1988))] and shall not make any taxable

expenditures, as defined in section 4945(d) [(26 USC § 4945(d) (1988))]. The

Trustee shall not make any investments that jeopardize the charitable purpose of

the Trust, within the meaning of section 4944 [(26 USC § 4944 (1988))] and the

regulations thereunder, or retain any excess business holdings, within the meaning

of section 4943(c) [(26 USC § 4943(c) (1988))].”

¶6 On August 26, 1994, testatrix executed a second codicil to her 1991 will adding

paragraph (B)(3)(j) to the third section of her will, which was the section creating the Trust.

Paragraph (B)(3)(j) stated the following:

-3- “I direct that the Trustee continue to rent the farm on conditions and terms similar

to those in effect at my death, to the present farm tenant, Wayne N. Meyer, or to

any of his adult children, provided that either Wayne Meyer or his adult children

to whom the farm is rented are actively engaged in farming and agree to

personally farm the land themselves and provided further that they follow good

farming practices as determined by the Trustee in its sole discretion.”

The testatrix ratified and confirmed her will in all other respects.

¶7 On September 23, 1996, testatrix’s farm manager, First of America Agricultural

Services, and Daniel entered a farm lease (1996 Lease), which was for the period of March 1,

1997, to the last day of February 1998. The 1996 Lease was a 50/50 crop share lease and

provided, in pertinent part, the following:

“LENGTH OF TENURE: The term of this lease shall begin on March 1,

1997, and shall continue through the last day of February, 1998, and year to year

thereafter, unless terminated in writing executed by either the Landowner, his

Agent or Tenant not less than four months prior to the end of the current lease

year.

EXTENT OF AGREEMENT: Terms of this lease shall be binding on the

heirs, executors, administrators or assigns, or agents for both the Landowner and

Tenant, in the same manner as upon the original parties.” (Emphases in original.)

According to the complaint, the aforementioned farm lease had continued to renew annually

since its execution. At the time of the August 2019 complaint, the farm lease’s current term was

to end on the last day of February 2020. The complaint also stated the Trust was comprised of

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2020 IL App (4th) 200074-U, Counsel Stack Legal Research, https://law.counselstack.com/opinion/prospect-bank-v-meyer-illappct-2020.