Ruby v. Ruby

2012 IL App (1st) 103210, 973 N.E.2d 361
CourtAppellate Court of Illinois
DecidedFebruary 17, 2012
Docket1-10-3210
StatusPublished
Cited by25 cases

This text of 2012 IL App (1st) 103210 (Ruby v. Ruby) 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
Ruby v. Ruby, 2012 IL App (1st) 103210, 973 N.E.2d 361 (Ill. Ct. App. 2012).

Opinion

ILLINOIS OFFICIAL REPORTS Appellate Court

Ruby v. Ruby, 2012 IL App (1st) 103210

Appellate Court MARTIN RUBY, MICHELLE RUBY, BENNETT RUBY, PATRICIA Caption RUBY, MARCY BAIM, HOWARD BAIM, and GARY BAIM, Plaintiffs-Appellants and Cross-Appellees, v. BERNICE RUBY, Individually and as Trustee of the Irwin Ruby Trust, Defendant-Appellee and Cross-Appellant.

District & No. First District, Sixth Division Docket No. 1-10-3210

Opinion filed February 17, 2012 Modified Opinion filed May 17, 2012 Rehearing denied May 24, 2012

Held In an action arising from a dispute over the proceeds of a trust created by (Note: This syllabus defendant’s deceased brother, the trial court, in plaintiffs’ action for a constitutes no part of declaratory judgment and a mandatory injunction to obtain the proceeds the opinion of the court that had been transferred by defendant’s brother from the initial trust to but has been prepared a second trust, erred in entering summary judgment for defendant on her by the Reporter of claim that her brother’s gift to plaintiffs in the first trust adeemed when Decisions for the her brother transferred the assets to the second trust, and the cause was convenience of the remanded for a determination of the appropriate gift to plaintiffs, since reader.) the doctrine of ademption did not apply to the circumstances of the case, and, further, the trial court should have granted plaintiffs summary judgment to the extent that the in terrorem clause of the trust was unenforceable under the facts of the case; additionally, the reviewing court lacked jurisdiction to address joint tenancy issues. Decision Under Appeal from the Circuit Court of Cook County, No. 07-CH-30152; the Review Hon. Daniel A. Riley, Judge, presiding.

Judgment Affirmed in part and reversed in part; cause remanded.

Counsel on Robert A. Weisman and Matthew W. McQuiston, both of Chicago, for Appeal appellants.

Gutman & Associates, LLC, of Chicago (Jeffrey K. Gutman, of counsel), and Tootelian Law Firm, LLC, of Hoffman Estates (Robert J. Tootelian, Jr., of counsel), for appellees.

Panel JUSTICE LAMPKIN delivered the judgment of the court, with opinion. Presiding Justice R. Gordon and Justice Palmer concurred in the judgment and opinion.

OPINION

¶1 This case involves a dispute over the proceeds of a trust. Plaintiffs, Martin Ruby, Michelle Ruby, Bennett Ruby, Patricia Ruby, Marcy Baim, Dr. Howard Baim, and Gary Baim, appeal the trial court’s order granting in part summary judgment in favor of defendant, Bernice Ruby, and against plaintiffs. Plaintiffs contend the trial court erred in finding that the gift at issue had adeemed. Plaintiffs further contend the trial court erred in denying their cross-motion for summary judgment regarding the enforceability of an in terrorem clause in the trust and that defendant was not entitled to the assets in the trust account. Defendant cross-appeals the trial court’s denial of her motion for partial summary judgment on the latter issues. Based on the following, we affirm in part and reverse in part and remand this cause for further proceedings.

¶2 FACTS ¶3 In the 1980s, defendant and her brother, Irwin Ruby, set up a joint tenancy brokerage account ending in number 1962. Irwin managed the account with the help of Richard Lazer, a stockbroker at David A. Noyes & Company. The account was carried under Irwin’s social security number. Defendant and Irwin lived together in a condominium that they purchased in 1980. Neither was married or had any children. In 2002, due to a change in clearing houses at the brokerage firm, Irwin and defendant signed an agreement related to the joint tenancy account known as a medallion agreement. At that time, the account was given the number

-2- ending in 1159. ¶4 In 2002, Irwin and defendant hired Howard Gopman, an attorney, for their individual estate planning purposes. In July 2004, Irwin created a trust. Irwin was the named trustee and defendant was the successor trustee. The clause at issue, article fourth, section 1, of the trust, named plaintiffs as the beneficiaries of the contents of the account ending in 1159. Article fourth, section 2, of the trust called for the distribution of specified dollar amounts to specified individuals totaling $215,000. Article fourth, section 3, of the trust called for the distribution of specified dollar amounts to specified charities totaling $40,000. Article fifth called for the distribution of the condominium to two of the plaintiffs as tenants in common pursuant to the terms of article twenty-fifth. Article twenty-fifth called for defendant to receive a life estate in the residence with all expenses paid by the trust. Article seventh detailed the administration and distribution of the trust estate. Specifically, article seventh, section 1, stated: “Upon my death, the trust shall place the remaining trust estate into one trust for my sister, BERNICE RUBY. Such trust shall be disposed as hereinafter provided.” Article seventh, section 2, called for the distribution to “any beneficiary *** such portions or all of the principal” as he or she requested from time to time. Article seventh, section 3, further provided: “During the life of the beneficiary, the trustee may in the trustee’s discretion pay to or use for the benefit of such beneficiary or his or her descendants so much or all of the income and principal of such trust as the trustee from time to time determines to be required or desirable for the education and best interests of the beneficiary and his or her descendants, adding any income not so paid to the principal.” Article twenty-eighth provided an in terrorem clause such that any beneficiary that contested the validity of the trust, sought to prevent the implementation of the trust, or who initiated proceedings to construe any provision of the trust and “such proceedings [were] deemed to be without merit by any court” forfeited his right to the benefits of the trust. ¶5 In August 2004, Irwin transferred all of the assets from the joint tenancy account ending in 1159 into a newly created trust account ending in 5122. At that time, the assets totaled $1,205,932.23. Irwin also transferred the deed to the condominium into the trust. Although defendant alleges on appeal that she was unaware of the transfers, defendant admitted in her deposition that she and Irwin had deeded the condominium into the trust account on September 28, 2004, and that she signed the deed. Defendant said Gopman never explained it to her and that she knew she signed something for the title. According to the deposition testimony of Lazer, the new account was necessary because the brokerage firm required a new account when title changed. Irwin received monthly account statements. ¶6 Irwin died on January 7, 2006. At the time of his death, there were no assets in the account ending in 1159. The assets in the trust account ending in 5122, however, totaled approximately $1,436,000. Gary was the executor of Irwin’s will and, for some time after Irwin died, there was confusion as to whether he was a cotrustee. According to his deposition testimony, Gary assisted defendant following Irwin’s death. The pair opened a bank account under both of their names with the intention of distributing Irwin’s assets according to his wishes. Gary testified that the new account was initially opened with funds from Irwin’s savings. At some point, it became clear that defendant was the successor trustee. Defendant sent a letter to plaintiffs in April 2006 advising them that they each were to receive 25% of

-3- the assets in the account ending in 1159. However, when defendant had dispersed all of the funds in the newly created account, she informed Gary that “there was not enough cash, she’d like to liquidate some stocks. And that [he] should check with [Howard, Marty, and Bennett].” Plaintiffs agreed.

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Bluebook (online)
2012 IL App (1st) 103210, 973 N.E.2d 361, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ruby-v-ruby-illappct-2012.