In the

United States Court of Appeals

For the Seventh Circuit

No. 01-1965

THE SOCIETY OF LLOYD’S,

Plaintiff-Appellee,

v.

ESTATE OF JOHN WILLIAM MCMURRAY,

deceased, judgment debtor,

Defendant,

and

HARRIS TRUST AND SAVINGS BANK,

executor of the Estate of John William

McMurray and trustee of John William McMurray’s

trust dated September 18, 1996,

Defendant-Appellant.

Appeal from the United States District Court

for the Northern District of Illinois, Eastern Division.

No. 99 C 6111--Blanche M. Manning, Judge.

Argued November 5, 2001--Decided December 11, 2001

 Before COFFEY, ROVNER, and EVANS, Circuit

Judges.

 EVANS, Circuit Judge. Harris Trust and

Savings Bank, the trustee of a trust

created by John William McMurray, appeals

from the district court’s order that it

pay a million dollar judgment that the

Society of Lloyd’s/1 obtained against

McMurray. McMurray died on August 28,

1997, while Lloyd’s was suing him in an

English court.

 Lloyd’s is the regulator of an English

insurance market in London. It is not an

insurer. Individual underwriting members

of Lloyd’s, known as "Names,"

independently assume insurance risks, and

each Name faces personal liability, much

like a partner in a general partnership.

See Indiana Gas Co. v. Home Insurance

Co., 141 F.3d 314, 316 (7th Cir. 1998).

McMurray was a Lloyd’s Name.

 In the late 1980’s and early 1990’s, the

Names incurred underwriting losses of
more than $12 billion. Many could not

obtain reinsurance. To resolve this

crisis, Lloyd’s introduced a

reconstruction and renewal plan under

which it created Equitas Reinsurance, a

company that would reinsure the Names. As

part of the plan, Lloyd’s required each

Name to pay a reinsurance premium by

September 11, 1996.

 Most Names voluntarily paid their

premiums. Some, however, including

McMurray, refused to pay. Lloyd’s

suedMcMurray and the other noncomplying

Names, and England’s High Court of

Justice found them liable for the

reinsurance premium. Lloyd’s obtained a

judgment against McMurray on March 11,

1998, for $551,644.97 plus interest,

which totaled about $827,000. The

judgment, with interest, is now worth

about $1 million.

 One week after the Equitas premium

payment deadline expired, but before

Lloyd’s filed suit against him, McMurray

created a trust into which he transferred

the bulk of his real and personal assets,

worth about $3.8 million. McMurray

appointed himself sole trustee and made

the trust completely revocable and

amendable. The trust instrument named

McMurray as the sole beneficiary during

his life, stating "the trustee shall pay

to me, or on my signed order, all the net

income and so much of the principle as I

may from time to time direct in writing."

In unmistakably clear language, as we

shall soon see, the trustee was directed

to pay McMurray’s debts after his death.

 On March 5, 1998, the circuit court for

Cook County, Illinois, opened a probate

case for McMurray’s estate. The estimated

value of McMurray’s estate, which

excluded the trust assets, was only

$400,000./2 On March 20, 1998, Harris,

acting as the administrator of

McMurrary’s estate (it was, of course,

also the trustee), sent claims notices to

Lloyd’s and Equitas notifying them of

McMurray’s death. The notices stated

that, under Illinois law, claimants have

a limited period in which to file claims

against the probate estate.

 Lloyd’s filed a registration of its

English judgment in the United States

District Court for the Northern District

of Illinois on September 15, 1999. The
next day it filed a citation to discover

assets in McMurray’s estate and trust.

Harris filed a motion to quash Lloyd’s

citation. The district court referred the

case to Magistrate Judge Rosemond, who

ruled that the English judgment was

valid, conclusive, final, and

enforceable. The judge granted the motion

to quash with regard to the estate assets

because Lloyd’s filed its claim after the

expiration of the 2-year period for

probate claims. See 755 ILCS 5/18-12(b)

(stating that all claims against an

estate are barred 2 years after death).

But the judge denied the motion to quash

with respect to the trust, holding that

its assets were not part of McMurray’s

probate estate and, therefore, not

subject to the 2-year enforcement period

for probate claims. The general statute

of limitations for enforcing foreign

money judgments is 7 years. See 735 ILCS

5/12-620; La Societe Anonyme Goro v.

Conveyor Accessories, Inc., 286 Ill. App.

3d 867, 869-70 (2nd Dist. 1997). 

 The district court entered judgment for

Lloyd’s, which filed a motion for

turnover of trust assets. In response,

the district court clarified its order,

ordering Harris to turn over trust assets

to satisfy the judgment. The district

court’s turnover order is a final

judgment, which we review de novo. See

Denius v. Dunlap, 209 F.3d 944, 949 (7th

Cir. 2000).

 Harris argues that the district court

should not have entered the turnover

order without conducting a hearing on the

trust’s liability for the debt. The

district court’s initial decision, Harris

argues, merely affirmed the magistrate

judge’s order granting discovery of the

trust assets. Thus, Harris argues that

the district court did not give it an

adequate opportunity to argue the merits

of the trust’s potential liability. A

district court may, however, summarily

compel the application of discovered

assets to satisfy a judgment. See

Matthews v. Serafin, 319 Ill. App. 3d 72,

77 (3rd Dist. 2001); Mid-American

Elevator Co. v. Norcon, Inc., 287 Ill.

App. 3d 582, 587 (1st Dist. 1996). This,

of course, is consistent with the sound

principle that statutes authorizing a

judgment creditor to discover the assets

of a debtor or of a third party in order

to enforce a judgment are to be broadly
construed. 735 ILCS 5/2-1402. See Chicago

v. Air Auto Leasing Co., 297 Ill. App. 3d

873, 878 (1st Dist. 1998). The Illinois

statute vests courts with broad powers

not only to order discovery, but also to

compel application of discovered assets

to satisfy a judgment. See id. (citing

Kennedy v. Four Boys Labor Serv., Inc.,

279 Ill. App. 3d 361 (2nd Dist. 1996)). 

 Additionally, it is clear from the

district court’s initial opinion that

Harris did indeed argue the merits of the

trust’s potential liability. Harris

argued that Lloyd’s judgment was against

McMurray individually and not against the

trust. The district court dismissed this

contention because it was "wholly

unsupported." The magistrate judge’s

order likewise indicated that Harris

argued that the trust was not liable

because it did not contain McMurray’s

"property." Thus, it appears that Harris

raised arguments on the merits of the

trust’s liability but simply failed, to

the satisfaction of the district court,

to support them adequately.

 Harris repeats its argument here that

the trust is not liable because once

McMurray transferred his assets into the

trust, they were no longer his property.

The trust instrument provides, however,

in crystal-clear language, that at

McMurray’s death "the trustee shall pay

from the residuary trust estate without

reimbursement my legally enforceable

debts." We construe trusts according to

their plain and unambiguous language. See

Dunker v. Reichman, 841 F.2d 177, 180

(7th Cir. 1988); Williams v. Springfield

Marine Bank, 131 Ill. App. 3d 417, 419-20

(4th Dist. 1985). Here, the trust

expressly directed Harris to pay

McMurray’s legally enforceable debts. 

 Harris argues that the judgment against

McMurray is no longer legally enforceable

because the 2-year period for filing

claims against probate estates has

passed. The argument goes something like

this: (1) McMurray’s trust directs the

trustee to pay McMurray’s "legally

enforceable debts"; (2) for a debt to be

"legally enforceable" against McMurray,

it must be enforceable against his estate

because the trust assets are now separate

property owned by another entity; and (3)

because Lloyd’s missed the probate filing

deadline, it does not have a legally
enforceable debt against McMurray’s

estate. This line of reasoning depends on

a tortured reading of the trust

instrument.

 Although the judgment is no longer

legally enforceable against McMurray’s

estate, that fact is irrelevant for

purposes of enforcing it against the

trust. The trust instrument, as we said,

directed the trustee to pay McMurray’s

debts. It did not instruct the trustee to

wait until McMurray’s creditors sued to

collect. Nor did it instruct the trustee

to hide behind legal technicalities in an

attempt to avoid paying valid debts.

Therefore, Harris had a duty to pay

Lloyd’s upon McMurray’s death once the

English court entered judgment against

McMurray. The debt became legally

enforceable at that point. Harris ignored

this duty.

 Allowing Harris to escape the debt would

not only violate the terms and the spirit

of McMurray’s trust but would also be

inequitable. Harris had notice of the

judgment well within the probate

limitations period--which might not make

a legal difference, but which certainly

makes an equitable difference. This is

not a situation in which a long-lost

creditor seeks to enforce a forgotten

debt years after the decedent’s death,

compromising the State of Illinois’

interest in swift resolution of the

decedent’s affairs. Harris simply seeks

to evade a valid debt of which it had

prior and timely notice. Lloyd’s notified

McMurray of the reinsurance premium in

July 1996. It obtained judgment against

him in March 1998, more than a year

before the probate enforcement period ran

in August 1999. There is no question that

the debt was legally enforceable

throughout that entire period. Harris

simply refused to pay it. 

 In support of its argument that the debt

is not legally enforceable, Harris cites

Exchange National Bank of Chicago v.

Harris, 126 Ill. App. 3d 382 (1st Dist.

1984) , in which the court held that a

trust provision similar to the one at

issue here did not give the creditor a

property right in the debtor’s trust

assets. See id. at 388. Exchange National

Bank, however, is easily distinguishable

from this case. There, as here, the

creditor had not yet obtained a judgment
when the debtor died. See id. at 384.

Hoping to go after the debtor’s trust in

the event of a judgment, the creditor

tried to enjoin the trustee from

distributing the trust assets until the

court resolved the collection action. See

id. The trial court denied the motion,

holding that the injunction would have

been an equitable attachment, a device

that courts discourage because it

unnecessarily deprives owners of control

over their property in anticipation of

judgments that may never materialize. See

id. at 386. Here, Lloyd’s does not seek

an equitable attachment--it has already

obtained a valid judgment against

McMurray. Nor does Lloyd’s seek an

injunction, which is an extraordinary

remedy requiring heightened scrutiny. It

seeks only to enforce a valid judgment.

The district court’s judgment that it may

do so against the assets of the McMurray

trust is AFFIRMED.

FOOTNOTES

/1 This case does not raise the subject matter

jurisdiction problem that we addressed in Indiana

Gas Co. v. Home Insurance Co., 141 F.3d 314, 319

(7th Cir. 1998). There, we held that complete

diversity did not exist between the parties

because the complaint named as defendants "Certain Underwriters at Lloyd’s, London" and "Certain London Market Insurance Companies." See id.

at 316. Because these entities were not corporations, we treated them as partnerships for purposes of diversity jurisdiction, and since at

least one Lloyd’s Name was domiciled in the same

state as the plaintiff, complete diversity did

not exist. See id. at 319. Here, the plaintiff is

the Society of Lloyd’s, a corporation incorporated under the laws of England, and there is no

question that diversity jurisdiction exists.

/2 The assets that McMurray’s executor ultimately

collected as estate property totaled about

$850,000. See rec. doc. 27, ex. B.