Walliser v. Northern Trust Co.

87 N.E.2d 129, 338 Ill. App. 263, 1949 Ill. App. LEXIS 325
CourtAppellate Court of Illinois
DecidedJune 29, 1949
DocketGen. No. 10,311
StatusPublished
Cited by4 cases

This text of 87 N.E.2d 129 (Walliser v. Northern Trust Co.) 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
Walliser v. Northern Trust Co., 87 N.E.2d 129, 338 Ill. App. 263, 1949 Ill. App. LEXIS 325 (Ill. Ct. App. 1949).

Opinion

Mr. Justice Bristow

delivered the opinion of the court.

Plaintiffs, George F. Walliser, and Elsie B. Walliser, are appealing from a judgment of the circuit court of DuPage county dismissing their complaint to have dedared null and void the trust "created under the will of William Walliser, whose sole heir-at-law is plaintiff, George F. Walliser.

The facts in this cause are undisputed, and the validity of the trust involves the determination of essentially three issues: whether under its terms the trustee is granted unlimited discretion to invade the corpus so as to render the trust void; whether the trust contains fundamental uncertainties and repugnancies; and whether it violates the rule against perpetuities and the statute against accumulations.

Under the disputed fourth clause of the will, whereby the trust is established, the testator set forth in legal terms a plan of distribution envisaging the various contingencies of survival among his beneficiaries.

In substance, it was provided that 80 per cent of the net income of the trust shall be paid to Ms son, George F. Walliser, for so long as he shall live, and the remaining 20 per cent to his niece, Kathryn E. Wilson, for her lifetime. These payments to his son should not, however, be less than $1,800 per year, otherwise the trustee is authorized to draw upon the corpus for any amount necessary to meet this sum, ‘ ‘ or any further amounts which may, in the opinion of said trustee, become necessary for the adequate care, support or maintenance of my said son, George F. Walliser.”

It was further specified that if George F. Walliser died with issue during the lifetime of Kathryn E. Wilson, such issue would, receive Ms 80 per cent of the net income per stirpes. If George F. Walliser died without issue, and Elsie B. Walliser were dead or remarried, all the net income would go to Kathryn E. Wilson during her lifetime, and if this income were less than $900 per year the trustees were authorized to draw upon the corpus to meet that designated sum. Similarly, if Kathryn E. Wilson died without issue, then all the net income should be paid to George F. Walliser, provided that if this sum were less than $1,800 the trustee could invade the corpus to make up the difference.

This clause provided further that if George F. Walliser died without issue, and Elsie B. Walliser were living and not remarried, then she would receive one-third of the net income, and Kathryn E. Wilson would receive two-thirds. If, however, Kathryn E. Wilson were not living, her two-thirds share of the net income would go to her issue, or if she had no issue, then one-third each would go to the testator’s brothers, John and George, for the remainder of their lives, and if they died prior to the death or remarriage of said Elsie B. Walliser, then this two-thirds share of the income would be accumulated and added to the corpus until the death of Elsie B. Walliser. If, however, she died or remarried during the lifetime of the testator’s brothers, then they would each receive one-half of the net income for the remainder of their lives.

The final income provision stated, in substance, that upon the death of both George F. Walliser and Kathryn E. Wilson, without issue, and the death of the remaining designated beneficiaries, the trustee shall continue to hold the trust estate in perpetuity, and pay one-half of the net income to the trustees of the First Methodist Episcopal Church of West Chicago, Illinois, and the other half to St. Mary’s Church.

The testator provided that the trust should terminate upon four contingencies: (1) on the death of the survivor of George F. Walliser and Kathryn E. Wilson, if both leave lawful issue, in which event two-thirds of the corpus shall go to the issue of George, per stirpes, and one-third to the issue of Kathryn; (2) on the death of the survivor of George and Kathryn, there being no surviving issue of Kathryn, in which event George’s issue would take the entire corpus; (3) on the death of Kathryn, she having survived George, and there being no issue of George, and Elsie is not then living, in which event Kathryn’s issue would take the entire corpus; (4) on the death of Elsie, she having survived George and his issue, as well as Kathryn, the entire corpus and accumulations shall go to the issue of Kathryn.

In addition to the foregoing essential provisions for distribution of the trust, the will contains clause 7, which is also contested by plaintiffs. It is provided therein that all other heirs are disinherited, and that in the event of a dispute concerning the construction of any provision the executor or trustee is authorized to confer with the testator’s attorney and their joint judgment shall govern in all questions concerning intestacy, cross remainders, and testamentary intentions, and shall be deemed conclusive and binding on all beneficiaries.

The trial court ordered that the testator’s brother, George Walliser, be presumed dead, in accordance with plaintiff’s complaint, hut, in construing the will, found against plaintiff on all other issues and dismissed the complaint for want of equity.

On this appeal plaintiffs contend first that the trust is void ab initio on the ground that under clause 4, uncontrollable discretion is given the trustee to invade the corpus.

As hereinbefore noted, this provision states: “ ... and the Trustee is hereby authorized to draw upon the corpus of the trust for . . . any further amounts which may, in the opinion of said Trustee, become necessary for the adequate care, support and maintenance of my son, George Francis Walliser. ’ ’

In support of plaintiffs’ contention, cases are cited which have been reviewed and limited by our Supreme Court in Booth v. Krug, 368 Ill. 487. The will therein contained a clause practically identical to that in the instant case. It provided:

“In the event the said income does not meet the needs of my sister, Stella (Booth) Krug, as set forth in Paragraph Seven (7) above, then the executors of this Will are hereby authorized and directed to use any or all of my estate to meet the needs of my said sister.”

With reference to this provision, the court stated:

" Only if the income of the fund does not equal the needs of the beneficiaries for their up-lceep, maintenance and enjoyment, may the corpus be used. This does not give the trustee absolute power to use the corpus, and a court of equity will restrain any exercise of the power without reference to the conditions imposed.”

Moreover, it was held in Burke v. Burke, 259 Ill. 262, that the possible exhaustion of the fund by the trustee, which potentiality also exists in the instant case, does not invalidate the trust, nor render its subject uncertain.

It would appear, therefore, that under the recent authorities a clause authorizing a trustee to draw upon the- corpus where necessary for the adequate support and maintenance of the beneficiary, does not give the trustee absolute and unlimited power, but sets forth a sufficient standard whereby a court of equity can determine whether the trustee abused the power authorized. Therefore, plaintiffs’ contention that the aforementioned clause rendered the trust void ab initio is without legal merit.

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Bluebook (online)
87 N.E.2d 129, 338 Ill. App. 263, 1949 Ill. App. LEXIS 325, Counsel Stack Legal Research, https://law.counselstack.com/opinion/walliser-v-northern-trust-co-illappct-1949.