In Re Estate of Phelan

FIRST DIVISION
AUGUST 06, 2007

No. 1-06-0820

IN RE ESTATE OF ) Appeal from the
) Circuit Court of
JOHN J. PHELAN, ) Cook County,
) Illinois, County
Deceased ) Department, Probate
) Division
(Nora Phelan Clifford, )
)
Plaintiff-Appellant and )
Cross-Appellee, )
)
v. ) No. 00 P 10864
)
Jimmie "Red" Baskin, a/k/a Jimmy Baskin,)
as Executor of the Will of John Phelan, )
and as Successor Trustee of the )
Declaration of Trust of John Phelan, )
dated, July 7, 2000, for the benefit of )
Karen Phelan, Joseph Phelan, Ryan )
Phelan, Nora Phelan Clifford and Nellie )
Phelan Wilson; Anthony J. D'Alexander, )
as Trustee of the MJRNN Irrevocable )
Trust dated June 1, 1999, for the )
benefit of Karen Phelan, Joseph Phelan, ) The Honorable,
Ryan Phelan, Nora Phelan Clifford and ) Jeffrey A. Malak,
Nellie Phelan Wilson, Karen Phelan, ) Judge Presiding.
Joseph Phelan, Ryan Phelan, Nellie )
Phelan Wilson, Wyatt Wilson, and Joseph )
Patrick Clifford, )
)
Defendants-Appellees and )
Cross-Appellants). )
No. 1-06-0820

JUSTICE GARCIA delivered the opinion of the court.

John J. Phelan established two separate trusts to provide

for his wife and their two minor sons and his two adult daughters

from prior marriages. In the first trust, MJRNN Irrevocable

Trust (MJRNN Trust), he included his two adult daughters as

beneficiaries. In the second, the revocable Declaration of Trust

(Revocable Trust), he provided for his wife and two minor sons

but did not provide for his two adult daughters. This appeal

concerns the validity of those two trusts and the pourover

provision of his will.

The plaintiff, Nora Phelan Clifford, one of the two

daughters, appeals from an order of the trial court granting the

defendants' motion for a finding pursuant to section 2-1110 of

the Code of Civil Procedure (735 ILCS 5/2-1110 (West 2002)) on

her reformation claims of her amended complaint and amended

petition. The plaintiff contends she presented sufficient

evidence to establish a prima facie case to reform both the MJRNN

Trust and the Revocable Trust.

In the cross-appeal, the defendants, specifically Jimmie

Baskin, acting as executor of the will and trustee of the

Revocable Trust, argue that the trial court erred when it found

2
No. 1-06-0820

that the Revocable Trust was not in existence at the time the

decedent, John Phelan, executed his will. Based on this finding,

the trial court determined that the pourover residuary provision

of the will failed, resulting in the residue of the estate

passing according to the laws of descent and distribution as if

the estate were intestate.

Because we find the plaintiff has failed to carry her burden

during her case in chief to warrant reformation of either trust,

we affirm the trial court's judgment against the plaintiff.

Because we find the Revocable Trust was in existence at the time

the will was executed, we reverse the trial court's judgment on

the cross-appeal.

BACKGROUND

The decedent, John Phelan, died on November 27, 2000. He

was survived by his wife, Karen Phelan, their two minor sons,

Joseph and Ryan, and two adult daughters from previous marriages,

the plaintiff and Nellie Phelan Wilson. Phelan provided for the

distribution of his assets in the MJRNN Trust, the Revocable

Trust, and his will.

In 1999, Phelan contacted his brother-in-law Anthony

D'Alexander and asked him to prepare an irrevocable life

insurance trust for him. The trust, known as the MJRNN Trust,

was to be funded with life insurance proceeds of $1.3 million and

3
No. 1-06-0820

it named, among others, the plaintiff and Wilson as

beneficiaries. Regarding the funding of a trust with proceeds of

a life insurance policy, section 2035 of the Tax Code (26 U.S.C.

§2035 (2006)) provides that if an individual owns or has

incidence of ownership in an existing life insurance policy and

gives the policy away within three years of his death, the

proceeds of the policy will be included in his estate. This is

true regardless of whether he transfers ownership to another

individual or to a trust. See 26 U.S.C. §2035 (2006). In

accordance with section 2035 of the Tax Code, the MJRNN Trust

provided that if Phelan died within three years of giving up

incidence of ownership of the insurance policies that formed the

corpus of the trust, the proceeds of those policies would be

distributed to the personal representative of the Phelan estate,

not the trustee of the MJRNN Trust.

At oral argument, the defendants' attorney explained that

one consequence of the three-year rule was that the Phelan estate

would be subject to a 50% estate tax that would reduce the value

of Phelan's insurance policies from $1.3 million to $650,000. He

further explained that the only way Phelan could have avoided the

ramifications of the three-year rule would have been to have

established the trust before he purchased the life insurance

policies. Phelan, however, had already purchased the life

4
No. 1-06-0820

insurance policies by the time he sought to create the

irrevocable trust so the application of the three-year rule was

unavoidable short of purchasing replacement insurance polices

after the creation of the MJRNN Trust.

Regarding Phelan's understanding of the three-year rule

provision of the MJRNN Trust, D'Alexander testified that he and

Phelan discussed the three-year rule and that Phelan understood

the consequences of that provision. In addition, Alan Bruggeman,

who prepared Phelan's will and Revocable Trust, testified in a

deposition that Phelan understood the consequences of the three-

year rule and that he only wanted to provide for the plaintiff

and Wilson through the MJRNN Trust and only if it succeeded. His

main concern was to provide for his minor sons.

Although the MJRNN Trust was dated June 1, 1999, D'Alexander

testified that it was not signed until sometime after that date.

Phelan died in November 2000, less than three years after the

transfer of the insurance policies to the MJRNN Trust. In

accordance with the three-year rule provision of the MJRNN Trust,

the proceeds of the trust were distributed to the personal

representative of Phelan's estate and none of the beneficiaries

under the MJRNN Trust received a distribution.

In May or June 2000, Phelan asked Bruggeman to review the

MJRNN Trust and prepare a will and trust for him. After

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No. 1-06-0820

discussing each provision of the will and the Revocable Trust,

Bruggeman faxed drafts to Phelan on July 7, 2000. Phelan signed

both documents and returned them to Bruggeman with some changes

made in ink. Bruggeman told Phelan that he would prepare clean

copies of each document for him to sign, but Phelan indicated

that drafts that were signed were sufficient.

The Trustee of the Revocable Trust was the residuary

beneficiary of Phelan's estate pursuant to Article IV of his

will. That pourover clause provided:

"I give the residue of my estate,

excluding any property over which I have a

power of appointment, to the trustee acting

under that certain [Revocable Trust] of John

Phelan dated July 7, 2000, to be added to the

principal held in trust thereunder as such

[Revocable Trust] exists as of the date of my

death to be administered pursuant to the

terms and conditions of said [Revocable

Trust] as they exist as of this date, which

terms and conditions are hereby expressly

incorporated by reference."

In his deposition, Bruggeman testified that he believed that

the Revocable Trust was funded on the date it was signed.

6
No. 1-06-0820

Although he did not prepare any transfer documents, he testified

that he believed that a deed in trust had been prepared.

On July 7, 2000, Phelan signed the will in the presence of

Karen McGinnis, Barbara Vest, and Gwenda Landingham. He signed

the will in the general office area of the building where he

worked and each witness also signed it at that time. McGinnis

and Vest testified that Phelan signed more than one document that

day, but they only witnessed and signed the will. Vest also

testified that D'Alexander and Michael Gavin were not present

when the will was signed. The will was notarized by D'Alexander

sometime after it was signed in the presence of others.

Phelan signed the Revocable Trust in the presence of Gavin

and D'Alexander in his personal office. Gavin signed the trust

as a witness, while D'Alexander notarized it. Gavin testified

that he did not remember for certain when the trust was signed,

but noted that it was dated July 7, 2000. He also indicated that

he was not present when the will was signed.

Phelan's will was admitted to probate on January 8, 2001,

and Baskin was appointed supervised executor of the estate. On

July 6, 2001, the plaintiff filed a petition to contest the will

and trusts. Wilson filed a will contest, alleging that the

Revocable Trust was a forgery. Baskin moved to dismiss both

actions. The trial court granted the motion in part and allowed

7
No. 1-06-0820

plaintiff and Wilson leave to amend their complaints.

On September 3, 2002, the plaintiff filed her first amended

complaint, requesting reformation and construction of the MJRNN

Trust. She also filed her amended petition regarding the

Revocable Trust and the will, consisting of five counts: (1)

reformation of the Revocable Trust; (2) lack of funding of the

Revocable Trust; (3) forgery of the Revocable Trust; (4)

declaratory judgment concerning the pourover clause of the will;

and (5) construction of the Revocable Trust. Wilson also filed

an amended contest, alleging forgery of the Revocable Trust. On

March 25, 2004, Wilson's will contest and count III of the

plaintiff's amended petition were dismissed by order of the trial

court.

The remaining parties then moved for summary judgment, which

the trial court denied. The case proceeded to trial. Following

the plaintiff's presentation of evidence, the defendants moved

for a finding in their favor pursuant to section 2-1110 of the

Code. On February 14, 2006, the trial court granted the motion

as to the plaintiff's amended complaint. The court held that the

reformation or construction of the MJRNN Trust was not

appropriate or possible because the trust had no funds. The

court also granted the motion as to count I of the amended

petition concerning reformation of the Revocable Trust.

8
No. 1-06-0820

On May 7, 2006, following trial, the trial court held: (1)

the Revocable Trust was not in existence as the time of the

execution of the will and, therefore, failed as a valid inter

vivos trust; (2) because the Revocable Trust was not in

existence, it could not be incorporated by reference into the

will and could not be considered a testamentary trust; (3)

because the residuary portion of the will consisted of the

pourover clause in favor of the Revocable Trust, that clause also

failed; and (4) the residuary portion of the estate was meant to

pass through the will, but because the Revocable Trust was not in

existence, the residue of the estate thereunder would pass

according to the laws of descent and distribution as if the

estate were intestate. The court made no findings concerning

counts II (lack of funding) and V (construction) of the amended

petition because the court's decision concerning count IV

(declaratory judgment of pourover clause of will) disposed of

those issues. This appeal followed.

ANALYSIS

I. Plaintiff's Appeal

In her appeal, the plaintiff argues that the trial court

erred in granting the defendants' section 2-1110 motion resulting

in the dismissal her amended complaint and count I of her amended

petition. Section 2-1110 of the Code provides:

9
No. 1-06-0820

"In all cases tried without a jury,

defendant may, at the close of plaintiff's

case, move for a finding or judgment in his

or her favor. In ruling on the motion the

court shall weigh the evidence, considering

the credibility of the witnesses and the

weight and quality of the evidence." 735

ILCS 5/2-1110 (West 2002).

When ruling on a section 2-1110 motion, a trial court

applies a two-prong analysis. Under the first prong, the court

determines whether, as a matter of law, the plaintiff presented a

prima facie case. A plaintiff establishes a prima facie case

when she proffers some evidence on every element essential to her

cause of action. People ex rel. Sherman v. Cryns, 203 Ill. 2d

264, 275, 786 N.E.2d 139 (2003). Because this presents a

question of law, we review such a determination by the trial

court de novo. Under the second prong, the trial court acts as

the finder of fact to determine whether the plaintiff presented a

prima facie case at the close of her case under the totality of

the evidence. In re Estate of Goldstein, 293 Ill. App. 3d 700,

709, 688 N.E.2d 684 (1997). As finder of fact, the trial court

must weigh all the evidence and determine the credibility of the

witnesses and may draw reasonable inferences from the evidence

10
No. 1-06-0820

presented. Because the court also considers evidence that is

favorable to the defendant, the "weighing process may result in

the negation of some of the evidence presented by the plaintiff."

Cryns, 203 Ill. 2d at 276. After considering the totality of the

evidence, the court must determine whether there remains some

evidence as to each essential element of her cause of action.

Cryns, 203 Ill. 2d at 276. Under this second-prong inquiry, we

will not reverse a trial court's ruling on appeal unless it is

against the manifest weight of the evidence. Cryns, 203 Ill. 2d

at 276.

A. Standard of Review

In this case, the trial court did not specify whether its

decision to grant the defendants' section 2-1110 motion was

premised on the plaintiff's failure to present a prima facie case

or because, under the totality of the evidence, her

prima facie case did not survive. The parties disagree as to

which approach the trial court took. The plaintiff maintains

that the court held that the plaintiff failed to present a prima

facie case, while the defendants argue that the court considered

the weight and quality of the evidence. Because our disposition

is the same in either instance, we will apply the de novo

standard.

B. Reformation Claims

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No. 1-06-0820

In her amended complaint and amended petition, the plaintiff

moved for the reformation of the MJRNN Trust and for the

reformation of the Revocable Trust. The plaintiff alleged that

Phelan wanted to provide for her and Wilson in his estate plan

and mistakenly believed that he did. She contends that because

Phelan's intentions were not carried out, he lacked understanding

of his overall estate plan and specifically of the effects of the

three-year rule provision of the MJRNN Trust and of the

provisions of the Revocable Trust.

In Handelsman v. Handelsman, 366 Ill. App. 3d 1122, 1132-33

852 N.E.2d 862 (2006), Justice Bowman of the Second District

examined the state of Illinois law regarding reformation of a

trust.

"Illinois courts have long held (with

narrow exceptions not pertinent here) that

'[a] will cannot be reformed to conform to

any intention of the testator expressed in

it, no matter how clearly a different

intention may be proved by extrinsic

evidence.' [Turek v. Mahoney, 407 Ill. 476,

482 ***; 95 N.E.2d 330 (1950); ***.]

***

We acknowledge that [the] reasoning

12
No. 1-06-0820

[against reformation of a will] does not

apply completely to will substitutes, as

there is no statutory requirement that they

be written, witnessed, and attested as wills

must be (see 755 ILCS 5/4-3(a) (West 2002)).

However, the effect of allowing the

reformation of a will substitute is similar

to that of allowing the reformation of a

will: to enable a stranger to the original

proceeding to 'make a will [substitute] for

the [settlor].' [Decker v. Decker, 121 Ill.

341, 357, 12 N.E.2d 750 (1887); ***]. ***

[E]ven in cases involving trusts that are not

will substitutes, Illinois courts have

stressed that the use of extrinsic evidence

to nullify the effect of unambiguous language

should be allowed 'only in extreme cases.' In

re Estate of McInerny, 289 Ill. App. 3d 589,

598[, 682 N.E.2d 284] (1997).

Because the plaintiff does not address or even note the

aversion in Illinois case law to reformation of trusts in

general, we limit our discussion to the legal question before us

- whether the plaintiff presented some evidence of Phelan's

13
No. 1-06-0820

mistaken belief that he provided for his adult daughters in his

estate plan, as the plaintiff contends.

As to the plaintiff's amended complaint regarding the MJRNN

Trust, we agree with the trial court that because the trust had

no funds, no reformation was possible. Accordingly, the

dismissal of the amended complaint was not error.

As to the plaintiff's claim seeking reformation of the

Revocable Trust in her amended petition, the plaintiff argues

that Phelan signed the Revocable Trust only because he was

mistaken in his belief that he had provided for his daughters in

the MJRNN Trust. We disagree.

The evidence was clear and ample that Phelan knew and

understood that the MJRNN Trust would fail if he died within

three years of establishing the trust. D'Alexander testified

that he discussed the three-year rule provision of the MJRNN

Trust with Phelan and that Phelan understood the provision and

its implications. Bruggeman also testified that Phelan

understood the ramifications of the three-year rule provision of

the MJRNN Trust and that his daughters would receive a bequest

only if the trust succeeded. While other drafting provisions may

have been available, the plaintiff presented no evidence that

Phelan did not understand the provision that was chosen. Because

Phelan was informed of, and understood the implications of, the

14
No. 1-06-0820

three-year rule specifically provided in a provision of the MJRNN

Trust, there is no evidence in the record of a mistaken belief on

Phelan's part regarding providing for his daughters in either

trust. Phelan knew that his adult daughters would not be

provided for if the MJRNN Trust failed when he signed the

Revocable Trust and the plaintiff did not present any evidence to

show otherwise. Accordingly, we find the trial court did not err

when it granted the defendants' section 2-1110 motion as to count

I of the amended petition at the close of the plaintiff's case in

chief.

II. Defendants' Cross-Appeal

In their cross-appeal, the defendants argue the trial court

erred in finding the Revocable Trust not in existence at the time

of the execution of the will. Alternatively, relying on section

4-4 of the Probate Act of 1975 (755 ILCS 5/4-4 (West 2002)), the

defendants argue that the incorporation of the Revocable Trust

into the will was not necessary to create a valid inter vivos

trust. Because we agree with the defendants as to their first

contention, we do not address their alternative argument.

A. Standard of Review

The defendants contend that the trial court's factual

finding that the will was executed before the Revocable Trust was

signed "was not supported by the evidence, but was based on a

15
No. 1-06-0820

negative inference." However, little is made of this claim. The

defendants' principal contention is that the will and trust were

signed together, contemporaneously, and therefore, the Revocable

Trust was in existence when the will was executed. Without

disturbing the trial court's findings of fact, we find the trial

court's ruling that the Revocable Trust was not "in existence" at

the time the will was executed raises a question as to the legal

effect of the documents. This is a conclusion of law to which we

apply a de novo standard of review. See Eychaner v. Gross, 202

Ill. 2d 228, 252, 779 N.E.2d 1115 (2002).

B. "In Existence"

It has long been established that so long as certain

requirements are met, a will may incorporate by reference other

documents, including trusts, even where these documents were not

executed with the formality required for the execution of a will.

In re Estate of Meskimen, 39 Ill. 2d 415, 417, 235 N.E.2d 619

(1968). "A separate paper may under certain conditions be

incorporated into and become a part of a will. The rule as to

when such an instrument may be referred to in a will and become a

part thereof has been settled in this State since Keeler v.

Merchants Loan & Trust Co., 253 Ill. 528[, 97 N.E. 1061 (1912)],

where the authorities were thoroughly examined, and the rule

clearly established with the reason for each requirement."

16
No. 1-06-0820

Wagner v. Clauson, 399 Ill. 403, 409, 78 N.E.2d 203 (1948). A

document will be incorporated into a will where: (1) the will

itself refers to the document as being in existence at the time

of the execution of the will and in such a way as to reasonably

identify it and show the testator's intention to incorporate the

document in the will and make it part thereof; (2) the document

is in fact in existence at the time of the execution of the will;

and (3) the document corresponds to the description in the will

and is shown to be the instrument referred to therein. Meskimen,

39 Ill. 2d at 417-18. "All three requisites must coexist in

order to incorporate an extrinsic document into a will."

Meskimen, 39 Ill. 2d at 418.

In this case, the dispute centers on whether the Revocable

Trust was "in existence" at the time of the execution of the

will. The trial court held that because the Revocable Trust was

not signed before the will was executed, it was not "in

existence" for purposes of incorporation.

The evidence at trial established that all the controlling

events occurred on July 7, 2000. Bruggeman sent Phelan both the

will and the Revocable Trust via facsimile. The will was

executed in the presence of McGinnis, Vest, and Landingham in the

common area of Phelan's office building. The Revocable Trust was

signed in the presence of Gavin and D'Alexander in Phelan's

17
No. 1-06-0820

personal office. Thereafter, D'Alexander notarized both the

Revocable Trust and the will.

The defendants initially contend that the trial court's

finding that the will was signed before the Revocable Trust "was

not supported by the evidence, but based on a negative

inference." We do not agree. That the will was signed before

Phelan arrived at attorney D'Alexander's office where Phelan

signed the Revocable Trust is unassailable. The trial court's

finding that this was in fact the sequence of events is the only

conclusion that can be drawn from the evidence. However, the

real issue, and one we believe presents a question of law, is

whether the Revocable Trust, for purposes of incorporation, had

to be signed by Phelan to be "in existence" prior to the

execution of the will.

While section 4-3(a) of the Probate Act (755 ILCS 5/4-3(a)

(West 2002)) requires that "[e]very will shall be in writing,

signed by the testator or by some person in his presence and by

his direction and attested in the presence of the testator by 2

or more credible witnesses," the Trusts and Trustees Act (Trust

Act) (760 ILCS 5/1 et seq. (West 2002)) has no similar

requirement for trusts. Instead, the Trust Act merely provides

that a trust may be "created by will, deed, agreement,

declaration or other written instrument." 760 ILCS 5/2(1) (West

18
No. 1-06-0820

2002).

To support the trial court's holding that the Revocable

Trust was not in existence when the will was executed, the

plaintiff contends that a written trust must be signed to be "in

existence." The plaintiff invokes the doctrines of

noscitur a sociis and ejusdem generis to conclude that the phrase

"other written instrument" of the Trust Act necessarily requires

that written trusts be signed because "wills, deeds and written

agreements must be signed in order to be valid." The plaintiff's

argument is that because the Revocable Trust was not signed prior

to the execution of the will, the Revocable Trust was not valid

at the time the will was executed, and, therefore, the Revocable

Trust was not "in existence" so as to be incorporated by

reference into the executed will. Whether the plaintiff's

argument regarding the validity of a written trust is legally

sound, we need not resolve. But see Alexander v. Mermel, 27 Ill.

App. 2d 281, 287, 169 N.E.2d 569 (1960) (in Illinois a trust in

personal property need not be in writing); Catherwood v. Morris,

345 Ill. 617, 630, 178 N.E. 487 (1931) (no requirement that

trusts in personal property be proved by some writing signed by

the party declaring such a trust).

In our judgment, this case does not turn on any perceived

statutory requirement that a written trust be signed to be valid.

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No. 1-06-0820

Rather, this case turns on the requirements of the doctrine of

incorporation by reference. See Harris Trust & Savings Bank v.

Beach, 145 Ill. App. 3d 682, 689, 495 N.E.2d 1173 (1986). The

test for determining whether an extrinsic document may be taken

as part of the will has been settled since 1912 when Keeler was

decided. The test stems "'[f]rom the proposition that a will may

be written upon different pieces of paper *** [so] that a will

may by reference incorporate into itself, as completely as if

copied in full, some other paper which in itself is not a will

for lack of execution.'" Keeler, 253 Ill. at 535, quoting W.

Page, Page on Wills, §§162, 163, at 183 (1901). The requirement

that such a "paper" be in existence at the time of the execution

of the will is also explained: "'If this were not the rule,

testator could, by executing a will and incorporating therein a

document to be executed in the future, create for himself a power

to dispose of his property in a testamentary manner by an

instrument not executed in accordance with the Statute of

Wills.'" Keeler, 253 Ill. at 536, quoting W. Page, Page on

Wills, §§162, 163, at 184 (1901). Based on this long-established

authority, our inquiry is limited to whether the test for

incorporation of an extrinsic document into a will has been met

here. If so, then the extrinsic document, the Revocable Trust in

this case, is incorporated into the will "as if copied in full."

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No. 1-06-0820

The plaintiff's argument that the Revocable Trust was not

"in existence" because it was not signed when the will was

executed is premised upon her challenge to the Revocable Trust's

validity as a trust. Yet, no authority is presented for the

contention that the validity of the trust must be established for

it to be "in existence" for incorporation purposes, and our

research has discovered none. Why the phrase "in existence"

should be construed to mean something beyond its ordinary common

meaning is unstated by the plaintiff. Certainly, the Revocable

Trust had to be "in existence" in a literal sense before it could

be signed. Why the Revocable Trust's existence for incorporation

purposes should only begin with the testator's signature is

unclear; we can think of no good reason and the plaintiff has

offered none.

The two testamentary documents were sent to the testator in

a simultaneous manner; he treated each as part of his total

estate plan; each was notarized by the same attorney on the same

date, so that each, the Revocable Trust and the pourover will,

was signed contemporaneously with each other. Under these facts

we find that the Revocable Trust was in existence at the time the

pourover will was executed. While the plaintiff contends that

the two documents were not signed contemporaneously, she points

to no evidence to the contrary. Nor did the trial court find

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No. 1-06-0820

that the documents were not signed contemporaneously. The trial

court relied only on the sequence of the signing, that the will

was signed before the Revocable Trust was signed, as the basis

for its ruling. The law does not require the trust be signed

before the will, where each is signed contemporaneously with the

other, in order for the trust to be "in existence" for

incorporation purposes. See Eschmann v. Cawi, 357 Ill. 379, 382,

192 N.E. 226 (1934) (for incorporation purposes, "[i]t makes no

difference that the instrument *** has been defectively executed

and not attested, if the [will] itself has been executed and

attested according to law and contains proper reference to the

other instrument"). It was mere happenstance that the will was

signed before the Revocable Trust. Such happenstance is not

enough to undo the estate plan Phelan so carefully devised to

provide for his sons and wife where the long-established test for

incorporation of an extrinsic writing into a will has been

satisfied. The test itself is a demanding one that must be

satisfied completely in order to make out a case for

incorporation.1 See Clauson, 399 Ill. 403 (1948) (extrinsic

1
In fact, it is "generally assumed that section 43(a) [now

section 4-4 of the Probate Act] was enacted because *** bequests

to a trust which has been amended after the date of the will ***

22
No. 1-06-0820

document bore a later date than will); Bottrell v. Spengler, 343

Ill. 476, 175 N.E. 781 (1931) (no showing that deeds conveying

real estate were intended to be part of will); Meskimen, 39 Ill.

2d at 417-18 (inter vivos trust independently significant so as

not to be incorporated in will although referenced). We are

aware of no authority requiring that the requisites for

incorporation of a trust in a will be expanded to include an

examination as to the trust's validity, as the plaintiff urges,

under the Trust Act.

Even if we were to look to the Trust Act for guidance, the

Act presents no obstacle to our holding. Section 18 of the Trust

Act mandates that the Act shall be liberally construed. 760 ILCS

5/18 (West 2002). Requiring that a trust be signed before it may

be "in existence" for purposes of being incorporated into a will

would be a narrow, rather than a liberal, reading of the Act. In

this regard we note that the plaintiff does not challenge the

validity of the Revocable Trust as it exists in the record, both

signed and witnessed.2 Her contention is limited to the timing

would be impossible under the strict rules of incorporation by

reference." Meskimen, 39 Ill. 2d at 421.
2
We do not consider the plaintiff's separate contention,

which we address below, that the Revocable Trust was not "in

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No. 1-06-0820

of its signing vis-a-vis the will.

On the record before us, there is no question but that all

three requisites of the Keeler test coexist here to incorporate

the Revocable Trust into the will. Phelan's will refers to the

existence of the Revocable Trust, reasonably identifying it and

demonstrating Phelan's intention to make the Revocable Trust a

part of the will. The existence of the Revocable Trust at the

time of the execution of the will is amply spread of record from

the point it was faxed with the will to Phelan on July 7, 2000.

Finally, the Revocable Trust corresponds exactly to the trust

referenced in Phelan's will. This is not a case where the

testator sought to incorporate into a will a trust he would form

later. Phelan was in possession of the Revocable Trust when he

signed his will. Phelan signed the Revocable Trust before the

will and the Revocable Trust were notarized by D'Alexander, one

immediately after the other.

Our disposition is further supported by the underlying goals

of testamentary construction -- to give affect to the testator's

intention and avoid intestacy. See Wise v. First National Bank,

10 Ill. 2d 623, 627, 141 N.E.2d 1 (1957); In re Estate of Stern,

existence" because it was not funded at the time it was signed as

a direct challenge to its validity.

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263 Ill. App. 3d 1002, 1009, 636 N.E.2d 939 (1994) (clear intent

of legislature in enacting section 4-4 of Probate Act was to

prevent intestacy). Phelan had an estate plan. Although the

MJRNN Trust failed, its failure was anticipated in Phelan's

estate plan. The incorporation of the Revocable Trust into his

will was the foundation of his estate plan.

The plaintiff also argues that the Revocable Trust was not

"in existence" because, as she claims, it was not funded at the

time Phelan executed his will. This claim likewise seeks to

expand the test for incorporation to add an element that the

trust be funded in order for it to be "in existence" to be made a

part of the will. We reject this claim for the same reasons set

out above. We have been presented with no authority that

requires a trust be funded in order to be "in existence" so as to

be made a part of a will.

We find as a matter of law that the trial court erred in

ruling that the Revocable Trust was not in existence for purposes

of incorporation into the pourover will. Accordingly, we reverse

the trial court's order that the Revocable Trust failed and that

the pourover clause of the will failed.

CONCLUSION

In summary, we affirm the order of the trial court

dismissing the plaintiff's amended complaint and count I of her

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amended petition. We reverse the trial court's order finding the

Revocable Trust and pourover clause of the will failed. Because

the trial court did not enter a ruling on counts II and V of the

plaintiff's amended petition, we remand for further proceedings

consistent with this opinion.

Affirmed in part and reversed in part; cause remanded.

McBRIDE, P.J., and R. GORDON, concur.

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