author: JUSTICE HOFFMAN

text:
    GAS POWER, INC., et al., Plaintiffs-Appellees, v. FORSYTHE GAS COMPANY, Defendant-Appellant.
    First District (4th Division)
    No. 1—92—2486
    Opinion filed June 30, 1993.
    Rehearing denied August 6, 1993.

      Pope & John, Ltd., of Chicago (William R. Quinlan, Steven J. Roeder, and William K. Blanchard, of counsel), for appellant.
    Kevin M. Forde, Ltd., of Chicago (Kevin M. Forde, Mary Anne Mason, and Ava Borrasso, of counsel), for appellees.
   JUSTICE HOFFMAN

delivered the opinion of the court:

Pursuant to section 2 — 1401 of the Code of Civil Procedure (Ill. Rev. Stat. 1991, ch. 110, par. 2 — 1401), plaintiffs, Gas Power, Inc. (Gas Power), and Michael P. Polsky, sought relief from an order of the circuit court of Cook County which dismissed their action with prejudice. Plaintiffs’ section 2 — 1401 petition was granted by the trial court and defendant, Forsythe Gas Company (Forsythe Gas), appeals.

We affirm the order of the trial court.

Background

Immediately prior to the events which gave rise to this action, Gerald R. Forsythe held a 63% interest in Indeck Energy Systems, Inc. (Indeck), and Polsky held the remaining 37% interest. Forsythe and Polsky were chairman and president, respectively, of Indeck.

On July 11, 1989, Gas Power, a corporation wholly owned by Polsky, entered into a partnership agreement with Forsythe Gas, a corporation wholly owned by Forsythe. The partnership, known as F.P. Gas Partners (the partnership), had as its stated purpose a joint gas drilling agreement with Douglas Oil & Gas, Inc. (Douglas Oil). The partnership agreement provided that the partnership would terminate upon the expiration or termination of the joint drilling agreement with Douglas Oil.

On July 12, 1989, the partnership entered into a joint drilling agreement with Douglas Oil which provided, inter alia, that Douglas Oil would drill gas wells and the partnership would fund the drilling of a minimum of five wells per year. The joint drilling agreement expired by its terms on December 31, 1999, but it gave Douglas Oil the option to terminate the agreement earlier if the partnership failed to fund the drilling operations.

In September 1990, Polsky was terminated as president of In-deck.

In February 1991, Forsythe notified Douglas Oil that the partnership would not fund the drilling of any future wells.

On March 9, 1991, Thomas Shields of Douglas Oil issued a letter terminating the joint drilling agreement as of December 31, 1990, by reason of the partnership’s failure to fund the drilling operations.

On May 1, 1991, plaintiffs filed the instant action against Forsythe Gas and Forsythe seeking injunctive relief, the appointment of a receiver, and damages. The five-count complaint alleged breach of fiduciary duty, breach of contract, breach of the partnership agreement, tortious interference with business relationships, and fraud.

In response to plaintiffs’ complaint, defendants filed motions pursuant to sections 2 — 615 and 2 — 619 of the Code of Civil Procedure (Ill. Rev. Stat. 1991, ch. 110, pars. 2 — 615, 2 — 619). The section 2— 615 motion alleged that plaintiffs’ complaint failed to state a cause of action against Forsythe because he was not a party to the agreement. The section 2 — 619 motion alleged that because the partnership had expired by its own terms upon the termination of the joint drilling agreement with Douglas Oil, plaintiffs’ action was moot and should be involuntarily dismissed.

The trial court dismissed plaintiffs’ original complaint. Thereafter,' with leave of court, plaintiffs filed a first-amended complaint against Forsythe Gas. The complaint sought a declaratory judgment that Forsythe Gas had wrongfully dissolved the partnership or, in the alternative, a judicial dissolution of it, and the appointment of a receiver. Plaintiffs alleged that Forsythe Gas terminated the partnership in violation of the agreement and breached its fiduciary duty by stopping the partnership from selling gas to the Indeck entities, entering into risky gas drilling contracts for the partnership without the consent of Gas Power, refusing to provide Gas Power access to the partnership’s books, and failing to account for capital contributions to the partnership. Plaintiffs further alleged that Forsythe, acting on behalf of In-deck, formed Columbus Joint Venture (Columbus) with Douglas Oil to drill for and sell gas and that Columbus began supplying gas to subsidiaries of Indeck in derogation of the partnership’s contractual rights to sell gas to the same subsidiaries.

Forsythe Gas filed a section 2 — 615 motion to dismiss plaintiffs’ first-amended complaint arguing that the partnership was terminated upon notification by Douglas Oil that the joint drilling agreement was terminated and that the complaint failed to state a cause of action for breach of the agreement or breach of fiduciary duty.

On September 24, 1991, the trial court found that the partnership had dissolved by its own terms when Douglas Oil issued the March 9, 1991, notice which terminated the joint drilling agreement. As a consequence, the trial court dismissed plaintiffs’ first-amended complaint with prejudice. Plaintiffs filed a timely notice of appeal from that order. The appeal was voluntarily dismissed and the issues raised therein are not the subject of this appeal.

On February 14, 1992, plaintiffs filed a section 2 — 1401 petition alleging newly discovered facts and requesting that the trial court modify its September 24, 1991, order to reflect that the dismissal of their first-amended complaint was without prejudice and grant them leave to file a second-amended complaint. The petition was supported by Polsky’s affidavit. Forsythe Gas filed its objections to plaintiffs’ section 2 — 1401 petition alleging that plaintiffs had failed to exercise due diligence in obtaining the newly discovered facts and that Polsky’s affidavit was deficient under Supreme Court Rule 191(a) (134 Ill. 2d R. 191(a)) because it was based upon hearsay. In reply, plaintiffs argued that Polsky’s affidavit complied with Rule 191(b), that the conversation related in the affidavit falls within the co-conspirator exception to the hearsay rule, and that they were diligent in discovering the facts upon which their petition was based. Plaintiffs’ reply was supported by Polsky’s second affidavit. Forsythe Gas filed a surreply in support of its objection to plaintiffs’ section 2 — 1401 petition and attached the affidavit of Douglas Gouge, the president of Douglas Oil.

The trial, court granted plaintiffs’ section 2 — 1401 petition and Forsythe Gas now appeals.

Opinion

A petition pursuant to section 2 — 1401 is a procedural device to vacate a final judgment or order not less than 30 days or more than 2 years after its entry. (Ill. Rev. Stat. 1991, ch. 110, par. 2 — 1401.) Its purpose is to achieve just and equitable results and to avoid unjust, unfair, or unconscionable circumstances. (In re Petition of Village of Kildeer to Annex Certain Property (1988), 124 Ill. 2d 533, 542, 530 N.E.2d 491, 495.) A section 2 — 1401 proceeding is not a continuation of the original action but a separate and independent action. (Kaput v. Hoey (1988), 124 Ill. 2d 370, 378, 530 N.E.2d 230, 233.) To be entitled to relief, the petitioner in a section 2 — 1401 proceeding must set forth factual allegations supporting each of the following elements: (1) the existence of a meritorious claim or defense; (2) due diligence in presenting the claim or defense in the original action; and (3) due diligence in filing the section 2 — 1401 petition. (Smith v. Airoom, Inc. (1986), 114 Ill. 2d 209, 220-21, 499 N.E.2d 1381, 1386.) As to matters not of record, the petition must be supported by affidavits (Ill. Rev. Stat. 1991, ch. 110, par. 2 — 1401(b)), which are governed by Supreme Court Rule 191 (see People v. Sanchez (1986), 115 Ill. 2d 238, 285, 503 N.E.2d 277, 296). The decision whether to grant a section 2 — 1401 petition is committed to the sound discretion of the trial court. (Kaput, 124 Ill. 2d at 378, 530 N.E.2d at 234.) A court of review is only justified in disturbing the judgment of the trial court on the issue if it finds that the trial court abused its discretion. Smith, 114 Ill. 2d at 221, 499 N.E.2d at 1386.

In their section 2 — 1401 petition, plaintiffs based their entitlement to relief upon four newly discovered facts, namely:

(1) On November 27, 1991, the American Arbitration Association ruled in Polsky’s favor on his claim, determining that Forsythe deliberately orchestrated Polsky’s wrongful discharge from his position as president of Indeck;
(2) On December 5, 1991, Gouge, president of Douglas Oil, told Polsky that Forsythe had induced him to terminate the joint drilling agreement with the partnership and promised to pay Douglas Oil above-market rates for gas through an entity other than the partnership and to indemnify Douglas Oil for any losses incurred by reason of its termination of the joint drilling agreement;
(3) On January 17, 1992, Forsythe notified Polsky that the partnership had granted Indeck a mortgage and security interest in all of the partnership’s property; and
(4) No accounting of the partnership had been made by Forsythe Gas, the liquidating agent, within one year of the alleged dissolution on December 31, 1990, as provided in the agreement.

Clearly, Forsythe Gas’ failure to render an accounting by December 31, 1991, has nothing whatever to do with the propriety of the trial court’s order of September 24, 1991, dismissing plaintiffs’ complaint with prejudice. While this circumstance might form the basis of a cause of action against Forsythe Gas, it would be a cause of action accruing after the dismissal order was entered and, as such, cannot form the basis of relief under section 2 — 1401. Because this cause of action accrued, if at all, about three months after the dismissal order, it is not, nor could it be, a fact which would have precluded the entry of the judgment from which relief is sought. Tsuetaki v. Novicky (1983), 158 Ill. App. 3d 505, 512, 509 N.E.2d 1019, 1024.

The security interest and mortgage of the partnership assets were not granted until after the dismissal order was entered. They also could not form the basis for relief under section 2 — 1401 for the same reasons given by this court in discussing Forsythe Gas’ alleged failure to render an accounting.

To form the basis of relief under section 2 — 1401, it is required that the newly discovered facts could not reasonably have been discovered at the time of or prior to the entry of the judgment or order from which relief is sought. (Johnson v. Steiner (1988), 179 Ill. App. 3d 556, 560, 534 N.E.2d 391, 394.) Polsky was terminated from his position at Indeck in September 1990. Thereafter, he presented the matter of his discharge to arbitration, charging that Forsythe caused his wrongful termination to deprive him of compensation due him and to gain control of his interest in Indeck. Plaintiffs can hardly argue that they did not know of the facts which formed the basis of Polsky’s arbitration proceeding prior to the entry of the trial court’s order of September 24, 1991. The fact that the arbitrator did not render a decision until two months after the entry of the trial court’s order is of no moment to our analysis. Plaintiffs knew of these facts prior to the order and, as such, cannot rely upon them as newly discovered facts in support of their section 2 — 1401 petition.

As a consequence of the foregoing, this court will analyze plaintiffs’ right to relief under section 2 — 1401 exclusively upon their allegations that after the entry of the September 24, 1991, order, Polsky was informed that Forsythe induced Douglas Oil to terminate the joint drilling agreement with the partnership. In that regard, Forsythe Gas raises several issues: that plaintiffs were not diligent in discovering this alleged fact and bringing it to the trial court’s attention prior to September 24, 1991, and that Polsky’s affidavit in support of this allegation is incompetent under Supreme Court Rule 191.

In his affidavit submitted in support of plaintiffs’ section 2 — 1401 petition, Polsky states, inter alia, that prior to the filing of the original action, he attempted to speak to Gouge and Thomas Shields of Douglas Oil about the termination of the joint drilling agreement but they refused to discuss the subject with him; that on December 5, 1991, during a conversation with Gouge, Polsky first learned that Douglas Oil did not wish to terminate the joint drilling agreement with the partnership but was asked to do so by Forsythe; that Forsythe promised Gouge that Douglas Oil would be able to continue selling gas at above-market rates to an entity controlled by Forsythe; that Forsythe agreed to indemnify Douglas Oil for all losses sustained by reason of its termination of the joint drilling agreement; and that Douglas Oil had been selling gas to Forsythe at above-market prices since terminating the joint drilling agreement with the partnership.

Forsythe Gas contends that Polsky’s affidavit as it relates to the December 5, 1991, conversation with Gouge is inadmissible hearsay and violates Supreme Court Rule 191(a). In response, plaintiffs argue that the conversation satisfies the co-conspirator exception to the hearsay rule and, as such, Polsky is competent to testify as to the conversation and the affidavit complies with Rule 191(a).

“A civil conspiracy involves two or more persons who combine for the purpose of accomplishing by concerted action either (1) a lawful purpose by unlawful means, or (2) an unlawful purpose by lawful means.” (Smith v. Eli Lilly & Co. (1990), 137 Ill. 2d 222, 235, 560 N.E.2d 324, 329.) “Concert of action applies when a tortious act is done in concert with another or pursuant to a common design, or a party gives substantial assistance to another knowing that the other’s conduct constitutes a breach of duty.” Eli Lilly, 137 Ill. 2d at 235, 560 N.E.2d at 329.

In this case, there can be no doubt that Gouge knew of Forsythe’s relationship to the partnership as an officer of Forsythe Gas because both Gouge and Forsythe executed the joint drilling agreement of July 12, 1989, on behalf of their respective principals. It would defy reason to suggest that if Forsythe requested that Douglas Oil terminate the joint drilling agreement with the partnership and agreed to purchase gas from Douglas Oil through another entity controlled by Forsythe, Gouge in acquiescing did not substantially assist Forsythe with full knowledge that Forsythe’s actions would breach the fiduciary duty owed both to the partnership and to Gas Power. Thus, Gouge would be a co-conspirator. If Forsythe made the requests attributed to him in Polsky’s affidavit and Gouge acquiesced, the acquiescence would have been in the furtherance of the conspiracy.

As was noted in People v. White (1984), 122 Ill. App. 3d 24, 35, 460 N.E.2d 802, 810, quoting People v. Meagher (1979), 70 Ill. App. 3d 597, 601, 388 N.E.2d 801, 803:

“ ‘The co-conspirator exception to the hearsay rule is well known. The acts and declarations of a co-conspirator in furtherance of the conspiracy are admissible against another who is a defendant, even when the acts and declarations are made out of the presence of the defendant. [Citation.] No conspiracy need be charged and so long as a prima facie case of conspiracy has been shown by independent evidence, acts or declarations in furtherance of the conspiracy are admissible.’ ”

In the case at bar, while Forsythe Gas submitted Gouge’s affidavit as an exhibit to its surreply in opposition to the section 2 — 1401 petition, the affidavit does not address the conversation of December 5, 1991, as related in Polsky’s affidavit. As such, if Polsky’s affidavit is admissible under the co-conspirator exception to the hearsay rule, it stands unrebutted as to Gouge’s statements to Polsky and would have to be taken as true by the trial court in ruling on the petition. See Tsuetaki, 158 Ill. App. 3d at 511, 509 N.E.2d at 1024.

Before the statements of a co-conspirator are admissible as an exception to the hearsay rule, there must be some independent evidence apart from the statements themselves tending to establish the conspiracy. (People v. Goodman (1980), 81 Ill. 2d 278, 283-84, 408 N.E.2d 215, 216-17.) The independent evidence may be circumstantial in that the agreement which forms the essence of the conspiracy may be inferred from all the surrounding facts and circumstances. People v. Saldana (1986), 146 Ill. App. 3d 328, 334, 496 N.E.2d 757, 762.

As indicated earlier, section 2 — 1401 requires that a petition be supported by affidavit as to matters not of record. Plaintiffs’ first-amended complaint was dismissed pursuant to a section 2 — 615 motion. In ruling upon a section 2 — 615 motion, the court is required to accept as true all well-pled facts in the complaint under attack. (Miner v. Gillette Co. (1981), 87 Ill. 2d 7, 428 N.E.2d 478.) The factual allegations of plaintiffs’ first-amended complaint were matters of record at the time that the trial court ruled upon the section 2 — 1401 petition which is the subject of this appeal. We find no logical reason why those factual allegations of record are entitled to any less presumption as to their validity in a section 2 — 1401 proceeding than they were for the purpose of the section 2 — 615 motion resulting in the order to which the section 2— 1401 proceeding addresses itself. Plaintiffs’ first-amended complaint alleges that on or about December 1, 1990, Forsythe, as managing partner of the partnership, stopped selling gas to the Indeck entities at the same time that Forsythe on behalf of Indeck and in conjunction with Douglas Oil formed Columbus. We believe that the allegations of plaintiffs’ first-amended complaint, taken as true, constitute the independent circumstantial evidence from which a conspiracy between Forsythe and Douglas Oil can be inferred to satisfy the independent evidence requirement of the co-conspirator exception to the hearsay rule.

As a consequence of the foregoing, we find that the statements made by Gouge to Polsky in their conversation of December 5, 1991, as related in Polsky’s affidavit, fall within the co-conspirator exception to the hearsay rule. As such, Polsky is competent to testify to the conversation and his affidavit submitted in support of plaintiffs’ section 2— 1401 petition does not violate Supreme Court Rule 191(a). Having decided that Polsky’s affidavit was admissible in support of the petition under Rule 191(a), we need not address the issue of whether the trial court could consider the provisions of Rule 191(b).

The next issue for our determination is whether plaintiffs satisfied the due diligence requirement of a section 2 — 1401 petition in bringing the facts of the alleged conspiracy to the attention of the trial court before the entry of the September 24, 1991, order dismissing their first-amended complaint. Forsythe Gas argues that plaintiffs failed to avail themselves of their discovery rights in the underlying action in an effort to obtain the testimony of Gouge or Shields. Plaintiffs respond that Polsky tried to speak to Gouge and Shields prior to the filing and during the pendency of the original action but they refused to discuss Douglas Oil’s termination of the joint drilling agreement as set forth in Polsky’s affidavit, a fact which is unrebutted in Gouge’s affidavit. While the record in the underlying action reveals that plaintiffs had sufficient information to place them on inquiry to determine whether Forsythe had engaged in actionable conduct in his dealings with the partnership, nothing in the record up to the entry of the order of September 24, 1991, indicates that plaintiffs should have suspected that Douglas Oil acted in concert with Forsythe. It is only after one accepts the December 5, 1991, conversation between Polsky and Gouge as true that Forsythe’s letter to Douglas Oil in February 1991, and Douglas Oil’s letter of March 9, 1991, terminating the joint drilling agreement, raise the specter of conspiratorial behavior. Whether plaintiffs will ultimately prevail at trial or whether Gouge and Forsythe actually had the conversation related in Polsky’s affidavit was not the issue before the trial court and is not the issue before this court. We believe that the record before us amply demonstrates that plaintiffs acted with due diligence under the circumstances of this case.

However, even assuming arguendo that one might find a lack of diligence on plaintiffs’ part in bringing the information of an alleged conspiracy between Douglas Oil and Forsythe to the trial court’s attention in the original action, that circumstance alone would not mandate a denial of plaintiffs’ section 2 — 1401 petition. In ruling upon a section 2— 1401 petition, the equitable powers of the court are invoked. (Elfman v. Evanston Bus Co. (1963), 27 Ill. 2d 609, 190 N.E.2d 348.) When, as in this case, evidence of unconscionable behavior is presented, the requirement of due diligence need not be rigidly enforced. See Tsuetaki, 158 Ill. App. 3d at 513, 509 N.E.2d at 1025.

In sum, we are unable to find that the trial court abused its discretion in granting plaintiffs’ section 2 — 1401 petition and, as a consequence, we affirm.

Affirmed.

JOHNSON and CAHILL, JJ., concur.


source: Caselaw Access Project

author: PRESIDING JUSTICE JIGANTI

license: Public Domain

text:
    SUSAN SEYMOUR et al., Plaintiffs-Appellees and Cross-Appellees, v. SIDNEY WILLIAMS, Defendant-Appellant and Cross-Appellee (Susan Seymour, Cross-Appellant; Ruth Williams, Intervenor-Appellee and Cross-Appellant).
    First District (4th Division)
    No. 1—91—0267
    Opinion filed June 30, 1993.

      Scott A. Brainerd and Michael Glosen, both of Chicago, for Sidney Williams and Ruth Williams.
    Daniel S. Hefter and Darcy L. Dulbis, both of Hefter & Radke, of Chicago, for Susan Seymour.
   PRESIDING JUSTICE JIGANTI

delivered the opinion of the court:

This appeal arises from the dissolution of a partnership, the Victorian Chicago Arts & Crafts Antique Gallery, which was operated by the plaintiff, Susan Seymour, and the defendant, Sidney Williams. Susan filed a claim against Sidney alleging breach of fiduciary duty and conversion. Following a bench trial, the court ordered the partnership liquidated and determined Susan’s and Sidney’s interests in the partnership assets, as well as the partnership debt to Ruth Williams, Sidney’s mother.

Sidney appeals the trial court’s distribution of assets and the court’s decision to allow Susan to purchase certain items of partnership inventory at cost. Susan has cross-appealed contending that the court erred by distributing the profits on a 50-50 basis. She further argues that the court should not have dismissed her claim against Sidney for conversion. Susan also has appealed the court’s finding that Ruth had title to a Frank Lloyd Wright chair and the court’s order to repay Ruth a sum of money which she loaned to the partnership. Ruth has appealed the amount of the court’s award to her and claims that she loaned the partnership more money than she was repaid.

Susan and Sidney entered into an oral agreement in 1981 to start an antique business in which they would purchase, restore, and resell antique furniture. They agreed to both contribute capital and to both work in the business in addition to keeping their other jobs. Susan testified that although their goal was to have a 50-50 partnership, at the time of the inception of the business, Sidney did not have much money and Susan was to be the principal investor. She further testified that the ownership of the business and the distribution of profits would be determined yearly by how much they had each invested in the business less whatever monies they took out of the business. According to Susan, they also agreed that since they were both collectors of antiques, either one of them could purchase any of the partnership antiques at the partnership purchase price, as long as the other partner agreed. They operated the business out of Susan’s home, where the inventory was stored until 1987 when they began to store and sell furniture at a warehouse.

Susan and Sidney operated the business very informally, including the operation of their business finances. Susan was in charge of keeping the records for the business and testified that she kept meticulous records that were contemporaneous with all of her transactions as well as Sidney’s transactions of which she was aware. A business bank account was not set up until 1984. Prior to this time, the proceeds from the sale of merchandise either went into Sidney’s personal account or Susan’s personal account depending on which one of them needed money at the time. They both continued to contribute capital as needed. Once the business account was set up, a certain amount of money went into the business account, some went into their personal accounts, and both the business account and their personal accounts were used to cover business expenses.

Susan testified that she kept a ledger from 1981 until 1984 of all business expenditures. She stopped maintaining the ledger in 1984 because Sidney was not giving her receipts of his expenditures. To her knowledge, Susan never obtained all of Sidney’s records. Susan kept all of her own cancelled checks and receipts.

In 1988, Susan and Sidney ceased to operate the business together and Sidney locked the warehouse, preventing Susan from having access to partnership inventory. A temporary restraining order was issued against Sidney prohibiting him from denying Susan access to partnership inventory.

At the onset of litigation, Susan subpoenaed all of Sidney’s bank accounts in order to determine his deposits and his income from the proceeds of sales of partnership merchandise. Susan discovered that about $15,000 in deposits had been made into Sidney’s account that she had not known about from the sale of items that he had not disclosed to her.

Susan compiled all of the records of her own transactions and the ones that she knew about from Sidney and made summaries of expenditures, business expenses, and income. She subsequently gave them to an accountant, Barry Klayman. Klayman gave Susan a report with regard to those records. Susan stated that until that time, she did not know what the capital accounts of the respective partners were.

Klayman testified at trial that he is a certified public accountant and at least 40% of his business dealt with accounting for partnerships. Klayman was provided with cancelled checks, receipts, Visa statements, check stubs, and contemporaneous books for the partnership. He stated that he had sufficient information from those materials to put together a compilation of the capital accounts of the partnership of Victorian Chicago. Klayman made a summary of the capital account balance of the partnership from its inception through August 15, 1990. The summary illustrated the contributions, profits, profits allocated on the capital ratio, and distributions. Klayman testified that Susan contributed $189,847 to Victorian Chicago. Sidney contributed $120,043. Susan took out $109,879 and Sidney took out $154,632. There had been a total profit of $830,218. Based upon the assumption that the partnership agreement was that profits and losses would be split proportional to capital accounts, Susan would receive all of the profits and losses because Williams always had a negative capital account. Susan would then have an ending balance of $163,186 and Sidney’s ending balance was a negative balance of $34,589. Thus, if their agreement was to split the profits according to their capital contributions, Susan would receive 100% of the remaining assets of the partnership and would be entitled to an additional $34,589 from Sidney. Klayman also calculated the partnership shares pursuant to the Uniform Partnership Act provision that all of the profits and losses are split equally. (Ill. Rev. Stat. 1989, ch. 1061/2, par. 18(a).) Applying the Uniform Partnership Act, Susan had an ending balance of $120,077 and Sidney, $5,520. Thus, after the creditors were paid, the remaining partnership assets would be divided 95% to Susan and 4% to Sidney.

Sidney testified that when the partnership began in 1981, he personally owned antiques which were sold for approximately $20,000 which was put into the business. Sidney stated that he and Susan had agreed that the partnership would pay him $500 a month for space that was used to store inventory. He stated that he did not supply Susan with records of all of the transactions that he engaged in for the partnership. Sidney stated that often Susan would refuse his offers to provide her with records. Sidney also had a fire in his residence at one time which destroyed records. Susan refused to do inventories. Sidney stated that he did not take $135,000 out of the partnership over time for his own personal use, but, rather, used it for partnership purposes. However, he did not keep any records of how much money he took out of the business from 1981 to the present. Sidney could also not produce any documentation for the $20,000 in inventory which he allegedly contributed to the partnership at its inception.

The court ordered the partnership dissolved and found that the total capital of the partnership was $125,597. Susan’s capital share was $120,077 and Sidney’s, $5,520. The partners were to sell all partnership property and the partnership funds were to be distributed as follows: the first $23,000 was to be paid to Ruth Williams in payment of the partnership obligation to her, the next $125,597 was to be paid 95.6% to Susan and 4.4% to Sidney, and any remaining funds were to be divided equally between Susan and Sidney.

Sidney now contends that the court erred in awarding Susan 95% of the capital and should have divided the assets equally between them. Sidney argues that Susan’s records were incomplete and, in many cases, inaccurate. Sidney complains that he was not credited properly for his own contributions, received no rent for the building which he purchased, and was not reimbursed properly for his own business expenditures. Sidney claims that the court abused its discretion in adopting Susan’s accounting as the basis for its distribution of partnership assets. Sidney insists that the court should not have accepted Klayman’s figures as the basis for its determination of capital and profits because Klayman’s testimony relied on Susan’s incomplete or selectively retained information which was never made available to Sidney.

We believe there was sufficient evidence from which the trial court could divide the partnership assets according to the Uniform Partnership Act (Ill. Rev. Stat. 1989, ch. 1061/2, par. 18(a)), which provides:

“Each partner shall be repaid his contribution, whether by way of capital or advances to the partnership property and share equally in the profits and surplus remaining after all liabilities, including those to partners, are satisfied ***.”

Despite the imprecise nature of the parties’ business practices, Susan provided records to substantiate each partner’s contributions to the partnership, their distributions, and the partnership profits. We agree with Sidney’s position that a fiduciary relationship exists between partners and each is bound to exercise the utmost good faith in all dealings and transactions related to the partnership. (Rizzo v. Rizzo (1954), 3 Ill. 2d 291, 120 N.E.2d 546.) Further, the managing partner who is responsible for all of the financial aspects of the partnership has a duty, as trustee, to maintain regular and accurate records and to account for partnership transactions. (Couri v. Couri (1983), 95 Ill. 2d 91, 447 N.E.2d 334.) However, Susan testified that she kept contemporaneous records of all of her transactions as well as those which Sidney reported to her. Susan conveyed those records and the records which she subpoenaed from Sidney’s bank to Klayman, a certified public accountant, whose testimony was used to determine the division of profits.

Sidney, on the other hand, provided the court with no records or evidence to contradict or augment any of the only concrete evidence in the record. Thus, there was ample evidence to substantiate the trial court’s apportionment of partnership assets.

Susan has also argued in her cross-appeal against Sidney that the trial court erred in applying the Uniform Partnership Act in its division of assets. Susan argues that the evidence in the record supports the fact that she and Sidney agreed that the partnership interests would be determined by the amount of capital that each partner had invested in the partnership at any given time. According to Klayman’s testimony at trial, if the calculations were done by this method, Susan would receive 100% of the partnership profits and Sidney would owe her an additional $34,589.

Partnership agreements as to the division of profits may be express or implied from acts, transactions, and the previous conduct of the partners. (Flannery v. Flannery (1943), 320 Ill. App. 421, 51 N.E.2d 349.) Susan supports her argument of her agreement with Sidney by pointing to her testimony at trial where she stated that the partners had an express agreement. Susan testified:

“Though our goal was to have a 50/50 partnership, at that time Mr. Williams did not have much money so that I was going to be the principal investor into the business and he would continue to work. ***
In the meantime we agreed that the ownership of the business ***, minus, of course, *** whatever money we took out of the business from sales and that profit would be distributed *** in the same manner.”

Sidney, on the other hand, denied at trial that he and Susan were working towards a 50-50 partnership and was impeached with his deposition testimony in which he agreed that he talked to Susan about trying to reach a 50-50 level of partnership ownership.

At best, it was difficult to determine from the parties’ testimony what they expressly agreed to. The Uniform Partnership Act provides that the rights of partners in relationship to the partnership are determined by the provisions in the Act “subject to any agreement between them.” (Ill. Rev. Stat. 1989, ch. 1061/2, par. 18.) We believe that in the absence of conclusive evidence of an agreement, the trial court appropriately applied the provision of the Act for an equal distribution of profits.

Sidney further appeals from the court’s order giving Susan the right to purchase, at cost, from, the partnership any or all of 191 antiques. The purchase of the items would be satisfied out of Susan’s portion of the partnership proceeds. Sidney argues that the items have greatly appreciated over time and the court should have ordered Susan to pay the fair market value. In his reply brief, Sidney argues that the items should be sold and the profits should be divided equally. Sidney contends that Susan is not entitled to the accumulated appreciation of the 191 partnership assets. Further, there is not enough evidence in the record to establish that Sidney agreed on 191 separate occasions to allow Susan to purchase at cost the 191 items of partnership property.

The question of whether the parties intended to enter into a contract is an issue to be decided by the trier of fact. (Northern Illinois Construction Co. v. Zale (1985), 136 Ill. App. 3d 822, 483 N.E.2d 1013.) The determination in that regard will not be reversed unless it is contrary to the manifest weight of the evidence. Howard A. Koop & Associates v. K P K Corp. (1983), 119 Ill. App. 3d 391, 457 N.E.2d 66.

Susan testified that she and Sidney agreed that either one of them could purchase any of the partnership antiques at partnership price, as long as they both agreed. She stated that Sidney had agreed that she could purchase at cost each of the items on a prepared list which was admitted into evidence. Sidney at one point testified that there was no such agreement. He also testified that there was such an agreement but that it was limited to two pieces of furniture. He was impeached with his deposition testimony in which he admitted that such an agreement had been made with respect to a “host of things.” Four other witnesses testified that on various occasions they knew about different pieces of furniture that either Susan or Sidney wanted to keep for herself or himself. Additionally, another list of items of furniture was admitted into evidence which the court ordered that Sidney could purchase at partnership cost.

We believe that the evidence supports the court’s finding that the parties agreed that either one of them could purchase items of antiques at partnership cost as long as the other party agreed. The only evidence which Sidney has presented to the contrary was his own conflicting testimony. Further, because of the general nature of their agreement, it was not necessary that Susan prove that they agreed 191 times on 191 occasions to each item on the list.

Susan has further alleged in her cross-appeal that the court erred by not holding Sidney liable for conversion. In Susan’s original complaint, she alleged that Sidney had converted partnership property when he changed the locks at the warehouse where partnership inventory was stored, precluding Susan from selling the inventory. Further, Susan alleged that Sidney had removed numerous pieces of partnership furniture to locations other than the warehouse and had held them there for nonpartnership purposes.

After hearing all of the testimony at trial, the judge issued a final order in which the count for conversion was “dismissed.” The order further stated that Sidney was to return to the partnership warehouse the items of partnership inventory which were listed by Susan as the items which he had taken. Susan now complains that the judge should not have dismissed her claim for conversion as she asserted sufficient facts to support her claim.

We first note that the dismissal in the final order was, in fact, a judgment for Sidney. There were no motions or pleadings seeking to dismiss the conversion count as a matter of law. The order was entered after the trial court heard all of the evidence. Therefore, the order was mischaracterized as a dismissal and was, in fact, a finding that Susan had not proved conversion of the partnership assets by a preponderance of the evidence. Thus, we must determine whether judgment for Sidney on the conversion count was against the manifest weight of the evidence.

A party claiming conversion must establish by a preponderance of the evidence the following elements: (1) an unauthorized and wrongful assumption of control, dominion, or ownership by a person over the personalty of another; (2) his right in the property; (3) his right to immediate possession of the property, absolute and unconditional; and (4) a demand for possession thereof. Farns Associates, Inc. v. Sternback (1979), 77 Ill. App. 3d 249, 395 N.E.2d 1103.

Here, we find that there was no unauthorized assumption of control. As Dean Prosser has described the degree of control required to constitute a conversion, it is “confined to those major interferences with the chattel, or with the plaintiff's rights in it, which are so serious, and so important, as to justify the forced judicial sale to the defendant.” W. Prosser, Torts §15, at 80-81 (4th ed. 1971).

Susan’s testimony illustrated that between June of 1988 and the date of trial, there were numerous occasions when Sidney changed the locks to the warehouse and she would not have access to its inventory. On one occasion, Sidney wrote her a letter explaining that his ultimate goal was to repay his mother the money that she had loaned the business and to raise the money he needed for the last of his operations. He explained that until these obligations were met, he would hold all of the present inventory in the warehouse and then they would decide how to divide the business and its contents. Susan wrote him a letter back and Sidney let her into the warehouse.

Susan also testified that she did not have a key to the warehouse on any regular basis until after June of 1988. She only had access through Sidney. In August of 1988, Susan told Sidney that she wanted to dissolve the business partnership and Sidney again changed the locks. At that point, Susan obtained a temporary restraining order to be allowed into the warehouse. Sidney changed the locks again in August of 1989 and explained to Susan that it was for security reasons. Various permutations of this scenario were repeated up until trial.

It appears from the evidence that the changing of locks and the moving of inventory from one location to another was analogous to the- informal manner in which the parties conducted their partnership affairs generally. While it is certainly not the ideal way to run a business, we do not believe that, under the circumstances, Susan has proved that Sidney intended to exercise the kind of control over the partnership inventory that is required to constitute a conversion. As a part of the dissolution of the partnership, the court has ordered Sidney to return all of the items of partnership inventory that Susan has listed as being in Sidney’s possession. We do not believe that the court’s finding for Sidney on Susan’s claim of conversion was against the manifest weight of the evidence.

We are next called upon to review the court’s decisions with regard to Ruth Williams, Sidney’s mother. Ruth loaned money to the partnership on many occasions to purchase inventory. Included in the inventory which was purchased with Ruth’s loans was a Frank Lloyd Wright chair.

In its final order, the court determined that the first $23,000 of partnership funds would be paid to Ruth in repayment of the partnership obligation to her. The court further awarded Ruth ownership of the Frank Lloyd Wright chair.

A separate appeal was filed on behalf of Victorian Chicago claiming that the correct amount owed to Ruth by the partnership is $11,469, rather than $23,000. Ruth has filed her own áppeal which asserts that she should have been awarded $67,810, rather than $23,000. Victorian Chicago has also appealed from the court’s award of the Frank Lloyd Wright chair to Ruth.

All of the parties agree that the partnership owes Ruth money for loans which she made over time to the partnership. The issue is how much money. At trial Ruth produced large numbers of cancelled checks, totalling $67,810, which had been deposited by Sidney into various bank accounts which included his personal account and a corporate account in the name of Victorian Chicago Hyde Park, Inc.

Ruth did not keep records of the money she lent the partnership. Of the $67,810 of cancelled checks which Ruth introduced, only $19,052 of them were payable to “Victorian Chicago.” The remaining checks were payable to “Sidney Williams.”

Susan acknowledged in her deposition that Ruth had loaned approximately $30,000 to the business which included the $7,000 that Ruth loaned the partnership for the purchase of the Frank Lloyd Wright chair. Susan testified at trial that since her deposition, she reviewed the financial records and discovered that of all the checks which were written by Ruth and payable to “Victorian Chicago,” only $5,200 was used for partnership purposes. Further, Susan discovered that Ruth had been repaid over $2,000.

Susan contends on appeal that the trial court should have relied upon Susan’s trial testimony and not her deposition testimony to determine the amount which the partnership owes Ruth. Ruth argues that the partnership should incur responsibility for Susan’s failure to record Ruth’s loans. Thus, the partnership should be held liable for the full amount of the checks which were written by Ruth.

The trial judge is in the best position to resolve conflicts in testimony and to determine the credibility of witnesses. (Flynn v. Cohn (1992), 154 Ill. 2d 160, 607 N.E.2d 1236.) As was true throughout this case, the judge heard confusing and conflicting testimony with regard to the arrangements and financial dealings of this partnership. Based on our review of the record, we believe the court’s determination of the partnership debt to Ruth was not against the manifest weight of the evidence.

Finally, Victorian Chicago contends that Ruth was not entitled to ownership of the Frank Lloyd Wright chair. We agree.

The record reveals that Ruth loaned the partnership $7,000 for the purchase of a Frank Lloyd Wright chair and several other small pieces of inventory. Susan testified that at the time of the loan, she and Sidney agreed that they would borrow money from Ruth to purchase the chair and in exchange for the loan, they agreed to repay Ruth her loan plus one-half of the profits from the sale of the chair. The remaining half of the profits from the sale would be split equally between her and Sidney.

In his deposition, Sidney stated:

"The arrangement was that my mother would get her money back, and 50 percent of what the profit was. Susan Seymour would get a quarter. I would get a quarter.”

There is also ample evidence in the record that the chair was treated as partnership property once it was purchased. Susan did restoration work on the chair and it was stored and displayed for sale with the rest of the partnership inventory. At one point, Sidney removed the chair from the warehouse where it was stored and placed it in Ruth’s residence. However, Sidney listed the chair and other items which were stored at Ruth’s home as “partnership inventory.”

Ruth argues that whatever arrangements Susan and Sidney made for the chair are not relevant. The only relevant agreement was the one Ruth made with the partnership which was that she would at least “double her money” by investing in the chair. Thus, Ruth concludes, she was making an investment and not a loan to the partnership and since the chair was not sold, she is entitled to it.

We believe there is ample evidence that Ruth loaned money to the partnership for the purchase of the chair. The trial court treated the $7,000 which Ruth gave the partnership as a loan and subtracted this amount from $30,000 in determining what the partnership was required to repay her upon dissolution. There is also ample evidence that the chair was partnership property. Under normal circumstances, this partnership asset would be divided equally between the partners. However, the evidence supports the fact that an agreement was made between the partners to pay Ruth 50% of the profits from the sale of the chair. As we have already discussed in this opinion, the Uniform Partnership Act honors such agreements and allows the partners to agree to deviate from the prescribed method of the division of profits.

Thus, we find that the court’s decision to award Ruth the Frank Lloyd Wright chair was against the manifest weight of the evidence. The Frank Lloyd Wright chair is partnership property and should be sold according to the provision in the final judgment order which addresses the sale of all partnership property. As per their agreement, after Ruth is repaid her loan for the chair, the profits should be divided 50% to. Ruth, 25% to Sidney, and 25% to Susan.

Accordingly, the judgment of the circuit court is affirmed in part and reversed in part.

Affirmed in part; reversed in part.

CAHILL and HOFFMAN, JJ., concur.


text:
    THOMAS B. DWORAK et al., Plaintiffs-Appellants, v. THE VILLAGE OF WILMETTE et al., Defendants-Appellees.
    First District (4th Division)
    No. 1—91—2350
    Opinion filed June 30, 1993.

      Stanley H. Jakala, of Berwyn, for appellants.
    Altheimer & Gray, of Chicago (Jack M. Siegel, of counsel), for appellees.
   JUSTICE HOFFMAN

delivered the opinion of the court:

Plaintiffs, police officers for the Village of Wilmette, appeal from an order which dismissed their complaint with prejudice under section 2 — 615 of the Code of Civil Procedure (Ill. Rev. Stat. 1989, ch. 110, par. 2 — 615). We consider: (1) whether counts I and II stated a cause of action for disparate treatment when one patrolman was selected to attend an advanced training school which allegedly prejudiced plaintiffs; and (2) whether count III stated a cause of action that the sergeants had a property interest in attending the school at the police department’s expense. For the following reasons, we affirm.

Plaintiffs filed a three-count complaint against defendants seeking a declaratory judgment. Counts I and II were brought by those plaintiffs who were patrolmen for the Village of Wilmette. They alleged that the police department enacted a rule which provided:

“Personnel holding the rank of Sergeant or higher are eligible to attend advanced management or administrative training, for the purpose of developing the skills necessary to administer a professional police department. While no ‘formula’ exists for selection to attend such training, the abilities, interests and needs of the employee will be balanced with present organizational needs by the Chief of Police to arrive at a selection.”

Plaintiffs alleged that another patrolman, Robert LaMantia, was given preferential treatment because he was allowed to attend one of the approved schools although he was not a supervisor and, therefore, not eligible under the department’s rules. Plaintiffs also alleged that the police chief admitted he made a mistake in allowing LaMantia to attend the school but he allowed LaMantia to attend regardless. Plaintiffs alleged that they were prejudiced because they were not selected to attend the school and requested that they be allowed to attend or be compensated for the tuition.

Count III was brought by two sergeants who were eligible but not selected to attend the school. They alleged that LaMantia was selected to attend the school although under the rules published at the time he was not eligible. They also alleged that the police chief admitted that LaMantia was selected by mistake. They requested that they be allowed to attend the school or be compensated for the tuition.

Defendants moved to dismiss the complaint under section 2 — 615 for failure to state a cause of action. After hearings, the complaint was dismissed with prejudice and plaintiffs now appeal.

Opinion

Under section 2 — 615, a complaint may be dismissed for failure to state a cause of action. (Ill. Rev. Stat. 1989, ch. 110, par. 2 — 615.) In considering a motion to dismiss, the court must accept as true the well-pled facts and any reasonable inferences therefrom. (Gouge v. Central Illinois Public Service Co. (1991), 144 Ill. 2d 535, 582 N.E.2d 108.) A cause of action should not be dismissed unless it clearly appears that no set of facts could be proven which would entitle plaintiff to recover. Gouge, 144 Ill. 2d 535, 582 N.E.2d 108.

Plaintiffs first argue that counts I and II stated a cause of action for disparate treatment because they were prejudiced when LaMantia was selected to attend the school. They concede they did not have a property interest in attending the school because they were not eligible under the rule. But they argue that because LaMantia was chosen, all the patrolmen should have been allowed to attend the school. They rely on several disciplinary cases discussing alleged disparate treatment of police officers involved in related events. (See Launius v. Board of Fire & Police Commissioners (1991), 211 Ill. App. 3d 545, 570 N.E.2d 532, rev’d (1992), 151 Ill. 2d 419, 603 N.E.2d 477; Wilson v. Board of Fire & Police Commissioners (1990), 205 Ill. App. 3d 984, 563 N.E.2d 941; Basketfield v. Daniel (1979), 71 Ill. App. 3d 877, 390 N.E.2d 492.) Those cases, however, involve administrative review of disciplinary actions and do not apply here.

Plaintiffs also argue that because the police chief admitted he made a mistake in selecting LaMantia for the school but still allowed him to attend, he did not act in good faith and his act of discretion was arbitrary, capricious, and unreasonable. Plaintiffs cite to Charles v. Wilson (1964), 52 Ill. App. 2d 14, 25-26, 201 N.E.2d 627, 633, which holds that the actions of a superintendent of police should not be subject to judicial review, “except to determine whether there was or was not good faith and a reasonable exercise of discretion.” See also Buege v. Lee (1978), 56 Ill. App. 3d 793, 796, 372 N.E.2d 427, 431 (“the actions of a police chief in implementing [his] responsibilities should not, except in the most extraordinary circumstances, be subject to a continuing review or supervision by the courts”).

Despite plaintiffs’ argument, they did not specifically allege in counts I and II that the police chief acted in bad faith or in an arbitrary, capricious, and unreasonable manner when he selected LaMantia for the school. Further, even if that could be inferred from the allegations, the only fact that plaintiffs can rely on to support their claim of bad faith was that LaMantia was not eligible to attend the school because he was a patrolman rather than a supervisor. This fact is not sufficient to subject the police chief’s decision to judicial review. Plaintiffs have not cited any authority that supports their argument that they have a cause of action against defendants under the facts alleged in this case and, as a result, the dismissal of counts I and II was proper.

As to count III, plaintiffs, who were sergeants, argue that they had a property interest in attending the school based on the department’s rule which stated that sergeants were eligible to attend. They also argue that their property interest was confirmed when the police chief admitted he had made a mistake in selecting LaMantia, who was not a sergeant, to attend.

Plaintiffs cite to several cases to support the statement that existing rules can denote property interests. (See Perry v. Sindermann (1972), 408 U.S. 593, 33 L. Ed. 2d 570, 92 S. Ct. 2694; Board of Regents of State Colleges v. Roth (1972), 408 U.S. 564, 33 L. Ed. 2d 548, 92 S. Ct. 2701; Begg v. Moffitt (N.D. Ill. 1983), 555 F. Supp. 1344; Fumarolo v. Chicago Board of Education (1990), 142 Ill. 2d 54, 566 N.E.2d 1283.) Generally, those cases consider claims of property interests for due process purposes. As explained in State Colleges (408 U.S. at 577, 33 L. Ed. 2d at 561, 92 S. Ct. at 2709):

“To have a property interest in a benefit, a person clearly must have more than an abstract need or desire for it. He must have more than a unilateral expectation of it. He must, instead, have a legitimate claim of entitlement to it. * * *
Property interests, of course, are not created by the Constitution. Rather, they are created and their dimensions are defined by existing rules or understandings that stem from an independent source such as state law — rules or understandings that secure certain benefits and that support claims of entitlement to those benefits.”

In this case, plaintiffs did not specifically allege in count III that they were denied a property interest in employment without due process of law when they were not selected to attend the school. Even if that could be inferred from the allegations, the facts alleged do not support a claim that they had a property interest in attending the school. They rely on the department’s rule as the source of their property interest. The rule, however, merely provided that the sergeants were eligible to attend. It stated that there was no formula to determine which officers would attend and that the officers’ abilities, interests, and needs would be balanced with the needs of the department in deciding who should attend. The rule, therefore, allowed a certain amount of discretion and, as a result, granted nothing more than a “unilateral expectation” rather than a “legitimate claim of entitlement” in attending the school. (State Colleges, 408 U.S. at 577, 33 L. Ed. 2d at 561, 92 S. Ct. at 2709.) It did not confer a property interest to the sergeants.

Plaintiffs also argue that the source of their property interest was a mutually explicit understanding that only supervisors, such as sergeants, could attend the school. (See Perry, 408 U.S. at 601, 33 L. Ed. 2d at 580, 92 S. Ct. at 2699 (property interest can be based on “mutually explicit understandings’ ’).) As evidence of the understanding, they rely on the police chief’s admission that he made a mistake in selecting LaMantia to attend the school. Regardless of whether patrolmen were eligible to attend the school, the fact that there was an alleged understanding that sergeants could attend the school does not establish that every sergeant would be selected to attend. The allegations of count III were insufficient to establish that there was a mutually explicit understanding which created a property interest. Accordingly, the dismissal of count III was also proper.

Affirmed.

JIGANTI, P.J., and JOHNSON, J., concur.


text:
    PAUL POWERS, Plaintiff-Appellant, v. RETIREMENT BOARD OF THE POLICEMEN’S ANNUITY AND BENEFIT FUND et al., Defendants-Appellees.
    First District (4th Division)
    No. 1—92—3967
    Opinion filed June 30, 1993.
    Law Offices of Joseph V. Roddy, of Chicago (Thomas J. Pleines, of counsel), for appellant.
    David R. Kugler, of Chicago, for appellees.
   JUSTICE HOFFMAN

delivered the opinion of the court:

The facts giving rise to this appeal are not in dispute. The plaintiff, Paul Powers, was appointed a member of the Chicago police department on March 12, 1962. Pursuant to section 5 — 170 of the Illinois Pension Code (Ill. Rev. Stat. 1991, ch. 1081/2, par. 5 — 170) (Code), the plaintiff contributed V-lz% of his salary to the Policemen’s Annuity and Benefit Fund (the Fund) for establishment of a widow’s annuity On July 24, 1991, the plaintiff, upon attaining his 63rd birthday, was mandatorily retired from the service of the Chicago police department. On the date of his retirement, the plaintiff was married to Vivian Powers. On September 6, 1991, a judgment of dissolution of marriage was entered in the circuit court of Cook County dissolving the marriage existing between the plaintiff and Vivian Powers. The dissolution action was commenced in 1988 and was pending at the time of the plaintiff’s retirement.

On September 12, 1991, the plaintiff requested a refund of all contributions made by him to the Fund for the widow’s annuity. The Fund denied the plaintiff’s request, citing to section 5 — 165 of the Code.

On July 24, 1992, the plaintiff filed a complaint for declaratory judgment in the circuit court of Cook County requesting that the court declare him entitled to a full refund of all contributions he made to the Fund for the widow’s annuity. The parties filed cross-motions for summary judgment, and on October 6, 1992, the trial court denied the plaintiff’s motion and granted summary judgment for the Fund. It is from this order that the plaintiff now appeals, and for the following reasons, we affirm.

The single issue on appeal is whether the trial court properly construed Code section 5 — 165, which provides as follows:

“When an unmarried policeman withdraws from service and enters upon annuity, and when a policeman becomes a widower while still in service, his accumulations for widow’s annuity shall then be refunded to him upon request. The widow of a policeman who has received a refund under this Section shall have no right to an annuity from the Fund, unless (1) the amount of the refund, plus interest thereon from the date of refund to the date of payment, is repaid to the Fund within one year after the date of marriage, and (2) the date of marriage is at least one year prior to the date of death, and (3) the widow otherwise qualifies under the terms of this Article.” Ill. Rev. Stat. 1991, ch. 108½, par. 5-165.

The primary rule of statutory construction requires that the intention of the legislature be ascertained and given effect. Courts must look first to the language of the statute, and where that language is unambiguous, the statute must be enforced as enacted without resort to other aids for construction. County of Du Page v. Graham, Anderson, Probst & White, Inc. (1985), 109 Ill. 2d 143, 151, 485 N.E.2d 1076.

We have examined the statute in question and find it to be clear, plain and unambiguous. This statute admits of only two circumstances where a participant in the Fund is entitled to a refund of sums paid for the establishment of a widow’s annuity; namely, if the police officer is unmarried when he withdraws from service and enters upon his own annuity, or when he becomes a widower while still in active service. The plaintiff in this case was married at the time he withdrew from service and entered upon his annuity and, consequently, was not entitled to a refund of his contributions under either circumstance set forth in the statute. As our supreme court held in People ex rel. Pauling v. Misevic (1964), 32 Ill. 2d 11, 15, 203 N.E.2d 393:

“Where the words employed in a legislative enactment are free from ambiguity or doubt, they must be given effect by the courts even though the consequences may be harsh, unjust, absurd or unwise. [Citations.] Such consequences can be avoided only by a change of the law, not by judicial construction, [citation] and, by the same token, courts are not at liberty to read exceptions into a statute the legislature did not see fit to make, [citation] or, by forced or subtle constructions, to alter the plain meaning of the words employed. [Citations.]”

We do not mean to minimize the logic of the plaintiff’s argument that the statute as written permits a retention by the Fund of all the plaintiff’s contributions for a widow’s annuity when there is no possibility for a widow to take. However, since the language of the statute is clear and unambiguous, it must be given effect as written. The plaintiff’s argument is one that ought to be addressed to the legislature.

For the foregoing reasons, the judgment of the circuit court of Cook County is affirmed.

Affirmed.

JOHNSON and CAHILL, JJ., concur.


author: JUSTICE MURRAY

text:
      In re ESTATE OF ULREH J. VOGT, JR., Deceased (David H. Vogt, Petitioner-Appellee, v. Robert E. Dunworth, as Successor Ex’r of the Estate of Ulreh J. Vogt, Jr., Respondent-Appellant).
    First District (5th Division)
    No. 1—92—2411
    Opinion filed June 30, 1993.

      Joseph G. Bisceglia and Richard A. Campbell, both of Jenner & Block, of Chicago, for appellant.
    Vincent J. Pascueci, of Chicago, for appellee.
   JUSTICE MURRAY

delivered the opinion of the court:

This is an appeal from an order of the circuit court which granted David H. Vogt (David) standing to object to and contest the first and second accounts to the court made by the executor of the estate of his father, Ulreh J. Vogt, Jr., deceased. The sole issue in this appeal is whether the trial court erred in granting David standing.

The facts, which are not in dispute, are as follows.

Ulreh J. Vogt, Jr., died on March 11, 1988, survived by five children. Under the terms of Vogt’s will and codicil, his tangible personal property was to be divided among his five children and the assets of his residual estate were to be placed into a residuary trust, with Ulreh J. Vogt III and Dolores V. Suess (David’s brother and sister) named as trustees. The residuary trust was then to be divided into five separate trusts, one for the benefit of each of decedent’s five children, who would then receive the net income from the trusts. Although Vogt died more than five years ago, there has yet to be a final accounting on the estate and the residuary trust (and individual trusts to be created thereunder) has not been funded.

Since the decedent’s death there have been two accounts filed with the court. The “First Current Account” was filed June 23, 1989, and the “Second Current Account” was filed November 22, 1991, each prepared by attorney Robert E. Dunworth (executor), successor executor of the estate. David filed objections on several grounds to both of these accountings on February 13,1992.

The executor of the estate filed a response to David’s objections on March 18, 1992. He contended that David, as a beneficiary of a trust created under the residuary trust (which had not been funded as of yet), was not an “interested person” as defined under the Illinois Probate Act of 1975 (Ill. Rev. Stat. 1989, ch. 1101/2, par. 1— 2.11) and, therefore, was not entitled to notice of the accountings. Based upon that fact, the executor concluded that David had no standing to object to the accounts made to the court. The executor argued that the trustees of the residuary trust were the only interested persons entitled to notice of the accounts and, accordingly, they were the only persons given the right to object to the accounts. The beneficiaries could only take action against the trustees, who were fiduciaries charged with representing the interests of the trust beneficiaries.

At a hearing held June 5, 1992, the circuit court heard argument on the matter of David’s standing to object to the accounts. The circuit court held that David did have standing to object to the accountings and the executor appealed, claiming that this court has jurisdiction over the matter pursuant to Supreme Court Rule 304(b)(1). 134 Ill. 2d R. 304(b)(1).

Initially, we are required to determine whether this court’s jurisdiction has been properly invoked since, without jurisdiction over the matter, this court may not consider the appeal. As stated above, jurisdiction is invoked pursuant to Supreme Court Rule 304(b)(1), which states:

“The following judgments and orders are appealable without the finding required for appeals under paragraph (a) of this rule:
(1) A judgment or order in the administration of an estate, guardianship, or similar proceeding which finally determines a right or status of a party.” 134 Ill. 2d R. 304(b)(1).

The executor contends that because the circuit court determined that David had standing to object to the accounts, the order “finally determined” his right or status as an interested person and, therefore, the order is appealable. We disagree.

Rule 304(b)(1) promotes efficiency and provides certainty by allowing appeal as to some issues as they are resolved during the administration of an estate. (Yardley v. Yardley (1985), 137 Ill. App. 3d 747, 484 N.E.2d 873.) But not every order entered in an estate proceeding may be immediately appealed. For appellate jurisdiction, the order must, “finally” determine the right or status of a party. In re Estate of Devey (1993), 239 Ill. App. 3d 630, 633, 607 N.E.2d 685.

The committee comments to Rule 304(b)(1) state:

“Subparagraph (1) applies to orders that are final in character although entered in comprehensive proceedings that include other matters. Examples are an order admitting or refusing to admit a will to probate, appointing or removing an executor, or allowing or disallowing a claim.” 134 Ill. 2d R. 304(b)(1), Committee Comments, at 245-46.

The present case involves none of the above-cited examples of proper appeals under Rule 304(b)(1). Nor does the order finally determine the right or status of David in relation to the estate. The executor claims that the court’s order created David’s status as an interested party, but this is clearly not so. David was, and still is, a person with a financial interest in the estate and, as such, he is an interested person within the meaning of section 1 — 2.11 of the Illinois Probate Act (Ill. Rev. Stat. 1989, ch. 1101/2, par. 1 — 2.11), notwithstanding the fact that there is no requirement that he receive notice or an accounting in his capacity as a beneficiary of a trust which has an “interested person” as a trustee.

We acknowledge that pursuant to section 24 — 2 of the Illinois Probate Act (Ill. Rev. Stat. 1989, ch. 1101/2, par. 24 — 2) notice of any hearings on the account need not be given to David in his capacity as a beneficiary of a trust created by the estate. Yet we see no evidence that this statute in any way precludes a trial court from recognizing a beneficiary’s interest in the estate and allowing that person to participate in proceedings on the account. We believe that a beneficiary, although not a necessary party, may be a proper party to come before the court in matters such as these. See Schlosser v. Schlosser (1991), 218 Ill. App. 3d 943, 578 N.E.2d 1203.

Furthermore, in In re Estate of Burke (1990), 203 Ill. App. 3d 319, 561 N.E.2d 220, the executor of the estate appealed pursuant to Rule 304(b)(1) after the circuit court ordered him to execute a deed conveying interest in property to certain heirs. The reviewing court, relying on the holding in In re Estate of Tingos (1979), 72 Ill. App. 3d 703, 390 N.E.2d 1349, concluded that the order was neither final nor appealable as to the executor, who had no standing to bring the appeal. Accordingly, the court adopted the general rule that an executor may not appeal from an order granting or denying a partial distribution since the executor does not have the type of interest that would entitle"him to appeal.

Although the instant case does not involve an order granting or denying partial distribution, we believe that the same conclusion must be reached. Here the executor is appealing from an order which recognizes David’s interest in the matters of the estate and allows him the opportunity to object to the accounts made concerning the estate. This ruling in no way affected, finally or otherwise, the rights or status of the executor and he cannot be aggrieved by such an order. Consequently we find that this is not a proper appeal under Rule 304(b)(1).

For all the reasons stated above, the appeal is dismissed.

Dismissed.

McNULTY and COUSINS, JJ., concur.

      According to appellee’s brief, his correct middle initial is “H” and not “M” as set forth in appellant’s brief.

      There is a separate action pending in the circuit court which "does not affect this appeal. It concerns the validity of the codicil to Vogt’s will. Apparently, according to Vogt’s will, five equal trusts were to be created under the residuary trust, one for each of his five children. The codicil, however, limited the amount to be placed in trust for two of David’s sisters to $100,000.