Taxation & Estate Planning

New Illinois Trust Amendment Case

By Joel A. Schoenmeyer

I previously blogged (here) about the Landheer case, in which the 3rd District Appellate Court found a trust amendment to be invalid because it was drafted by a non-lawyer.

Landheer is followed in a new 1st District case, Herlehy v. Bistersky Trust (available here as a PDF). Basically, the case involves the decedent's great-nephew's attempt to prove that he was entitled to a larger portion of her trust. There's some evidence that his great-aunt wanted him to inherit more, but no trust amendment was ever executed. So the plaintiff (Timothy Herlehy) tries a number of different theories to get what he wants. One theory is that his great-aunt (Marie Bistersky) DID in fact amend her trust via an investment form prepared by a non-lawyer. The court in Herlehy agreed with the court in Landheer that such a form would not have been a valid trust amendment.

Another of Mr. Herlehy's arguments is that First National Bank of LaGrange (which was Mrs. Bistersky's trustee at the time) breached its fiduciary duty by failing to steer Mrs. Bistersky to an attorney to draft an amendment to her trust. The court in Herlehy found that the trustee had no duty in this area. If Mrs. Bistersky had wanted to amend her trust, she was free to do so -- and doing so was her responsibility.

The lesson here is that, if you want to amend your trust, you should do so in the clearest manner possible, and you should do so by having a trust amendment drafted by an attorney.

Full post as published by Death and Taxes Blog on January 27, 2011 (boomark / email).