Harris Trust and Sav. Bank v. Beach

• Decision Date: 30 March 1921
• Citation: 99 Ill.Dec. 435,495 N.E.2d 1170,145 Ill.App.3d 673
• Parties: , 99 Ill.Dec. 435 HARRIS TRUST AND SAVINGS BANK, Robert Hixon Glore and William S. Gray III, as Trustees of Indentures of the Trust dated
• Court: United States Appellate Court of Illinois

Page 1170

495 N.E.2d 1170

145 Ill.App.3d 673, 99 Ill.Dec. 435

HARRIS TRUST AND SAVINGS BANK, Robert Hixon Glore and William S. Gray III, as Trustees of Indentures of the Trust dated March 30, 1921, and May 31, 1926, respectively, Plaintiffs, v. Frances Glore BEACH and Robert Hixon Glore, Defendants-Appellants Charles F. Glore III, Sallie Glore Farlow and Edward R Glore, Defendants- Appellants California Institute of Technology, Santa Barbara Foundation, Santa Barbara Cottage Hospital, The Kansas University Endowment Association, and Frederick G. Acker, as Special Trustee Under the Will of Charles F. Glore, Jr. Defendants- Appellees.

No. 85-1649.

Appellate Court of Illinois, First District, Third Division.

June 25, 1986.

Bell, Boyd & Lloyd, Chicago, Frances J. Higgins, Robert L. Wiesenthal and Alice S. Lonoff, of counsel; Sidley & Austin, Chicago, Loren E. Juhl, Henry A. Preston, John C. Vryhof of counsel; for defendants-appellants.

Winston & Strawn, Chicago, Frederick G. Acker, Kimball R. Anderson, Carol A. Harrington and Nancy J. Brown, of counsel; for defendants-appellees.

Justice McNAMARA delivered the opinion of the court:

Frank P. Hixon established two trusts 60 years ago under which his second wife, Alice, was to enjoy the income for life and upon her death the principal was to be given to Hixon's heirs. Alice died in 1982. The trustees, Harris Trust and Savings Bank, Robert Hixon Glore, and William S. Gray III, now seek instructions regarding distribution of the estate. The issues on appeal are whether the doctrine of worthier title is applicable; and whether the class of heirs is to be determined at Hixon's death in 1931, or at Alice's death in 1982. The trial court found that the class is to be determined at Hixon's death. It thus granted summary judgment against the grandchildren and great-grandchildren of Hixon, and instructed the trustees to distribute the property to beneficiaries under the wills of Hixon's deceased daughters. The grandchildren and great-grandchildren appeal. In a factually related opinion filed by this court today, we have determined the proper distribution of property left by Hixon under a testamentary trust. (Harris Trust & Savings Bank v. Glore (1986) 145 Ill.App.3d 682, 99 Ill.Dec. 438, 495 N.E.2d 1173. The legal issues there, however, are unrelated to the issues pertaining to the inter-vivos trust addressed in the present case.

On March 30, 1921, in anticipation of marrying Alice, Hixon created a trust in the form of an ante-nuptial agreement under which Alice received a life estate in the net income and a general testamentary power of appointment over $50,000 of the principal, which power Alice exercised in her will. The purpose of the trust was to "make suitable provision" for Alice "in lieu of any dower, interest or claim that she might have" to Hixon's estate. Upon Alice's death, the principal was to be "divided among the heirs of [Hixon], share and share alike." In 1926, Hixon created a second trust for Alice "in addition to * * * the trust created by the ante-nuptial contract of March 30, 1921." The 1926 trust provided Alice with the net income for life, and upon her death the principal was to be "distributed equally among my heirs." The corpus of each trust was stock of Pioneer Investment Company, an investment holding company of which Hixon was president, a director and principal stockholder.

Hixon died in 1931, survived by two daughters, Ellen H. Glore and Dorothy H. Clendening, who both died in 1973. Dorothy had no children. Ellen had three children, defendants Robert H. Glore, and Frances Glore Beach (grandchildren), and Charles F. Glore, Jr., who is deceased. Charles had three children, defendants Charles F. Glore III, Sallie Glore Farlow and Edward R. Glore (great-grandchildren). The beneficiaries under Dorothy's will, defendants California Institute of Technology, Santa Barbara Foundation, Santa Barbara Cottage Hospital, the Kansas University Endowment Association (charities), and Frederick Acker, as special trustee under the will of Charles F. Glore, Jr., contend that the heirs should be determined as of 1931, when Hixon died, thus limiting the class of heirs to Dorothy and Ellen. This would permit these parties to take as beneficiaries under Dorothy's will.

The grandchildren and great-grandchildren counter that the class of heirs should be determined as of 1982, when the life tenant Alice died, thus including these defendants. They also maintain that the doctrine of worthier title must be applied, thus creating a reversion in Hixon and permitting them to inherit by descent.

The trial court awarded summary judgment in favor of the charities. Although it noted that our supreme court had found the doctrine of worthier title to be a rule of law in several instances, it applied the doctrine as a rule of construction. In construing the trust language, the court found that Hixon did not intend a reversion, but rather intended a remainder in his heirs. The court also found that the class of heirs was to be determined at the time of Hixon's death, and not at the time of Alice's death. Thus, the class of heirs was limited to Hixon's two daughters, and the charities would take under Dorothy's will.

We first address the issue of whether the doctrine of worthier title is applicable to the present case. Under the doctrine when the owner of a fee simple attempts to create a life estate with a remainder to his own heirs, the remainder is void. The grantor keeps a reversion. "Thus, A conveys to B for life, and after B's death to the heirs of A. By virtue of the rule the state of the title is: life estate in B, reversion in fee simple in A." (Moynihan, Introduction to the Law of Real Property at 150 (1962).) The practical effect of the doctrine, then, is that the heirs are prevented from taking anything at all, unless they later take the property under the intestacy statutes or under the residuary clause of the grantor's will. In the present case, the grantor Hixon made an inter-vivos conveyance to Alice for life, and after Alice's death to the heirs of Hixon. If the doctrine of worthier title is applied, the state of the title was: life estate in Alice, reversion in fee simple in Hixon. The heirs take nothing under the trust, and would only take under the residuary clause of Hixon's will. Consequently, we must determine if Illinois law mandates the use of the doctrine of worthier title for these two trusts, and if so,...