Tiltges v. Balow
Key Takeaways
- 1 Conclusory affidavit paragraph lacking factual foundation for trust discretion violated Rule 191(a) and was stricken.
- 2 Section 2-619 dismissal reversed where stricken affidavit paragraph was defendants' sole affirmative matter defeating breach-of-fiduciary-duty claim.
- 3 Relevant for trust and estate litigators defending or challenging inter-trust transfers and fiduciary duty claims under the Illinois Trust Code.
Summary
This case arose from an intra-family dispute over the Herbert J. Sturm Trust. Plaintiff Candice Tiltges, a co-trustee and beneficiary, alleged that Ellen K. Sturm breached her fiduciary duties by transferring Herbert's one-half interest in the marital residence from the Herbert Trust to her own trust without consideration and for the purpose of disinheriting Candice. Defendants moved to dismiss under section 2-619(a)(9), supported by a joint affidavit and a trustee's certificate. The trial court denied plaintiff's motion to strike two paragraphs of the affidavit and granted the dismissal with prejudice. Plaintiff appealed.
The appellate court affirmed the denial of the motion to strike paragraph 5, finding that the affiants' familial relationship with Ellen and their roles as successor co-trustees provided sufficient personal knowledge of Ellen's living arrangements and finances to satisfy Rule 191(a). However, the court reversed as to paragraph 6, holding it improperly conclusory because neither the paragraph nor the trustee's certificate it relied upon contained any facts showing how the transfer of Herbert's interest helped Ellen meet her support, health, education, or maintenance needs under section 4.3(a) of the Herbert Trust. The court exercised its Rule 366(a)(5) authority to strike paragraph 6.
With paragraph 6 stricken, defendants had no affirmative matter to defeat plaintiff's claim. The court reversed the dismissal and remanded, holding that plaintiff's well-pleaded allegations — that the transfer provided Ellen no additional means of support and was designed to disinherit plaintiff — stated a viable cause of action for breach of fiduciary duties of impartiality, loyalty, honesty, and good faith under the Illinois Trust Code and common law.
Key Holdings
1. An affidavit paragraph asserting that a trustee's transfer complied with a trust's discretionary distribution standard violates Rule 191(a) as improperly conclusory where neither the paragraph nor the documents it references contain facts showing how the transfer actually served the beneficiary's support, health, education, or maintenance needs.
2. A document labeled a 'trustee's certificate' that does not satisfy the requirements of section 1013 of the Illinois Trust Code and is unsworn does not provide adequate factual support for a Rule 191(a)-compliant affidavit.
3. Protections for third parties under section 1013(g) of the Illinois Trust Code and a trust's exculpatory provisions do not shield a trustee from liability for her own bad faith acts.
4. Where a defendant's sole affirmative matter supporting a section 2-619(a)(9) motion to dismiss is stricken, and the plaintiff's complaint adequately pleads facts that a trustee's transfer violated the trust's discretionary distribution standard and constituted a breach of fiduciary duties, dismissal with prejudice is improper and the cause must be remanded.