Opinion ID: 2628309
Heading Depth: 3
Heading Rank: 2

Heading: Ockey Ratified the 1994 Conveyance

Text: ¶ 25 Whether we characterize the facts found by the district court in the worst light or the best light, Ockey ratified the 1994 conveyance. ¶ 26 Placing the worst gloss on the facts found by the district court, it is possible that the trustees engaged in self-dealing and violated their fiduciary duty to Ockey by failing to transfer the ranch property when the trust terminated. Even if this were the case, the 1994 conveyance would be voidable and ratified by Ockey. According to well-established case law, a trustee's violation of his fiduciary duty is voidable and capable of ratification. [22] [A]fter a breach of trust has occurred, a beneficiary may expressly or impliedly express satisfaction with the trustee's action and thereby prevent himself from claiming thereafter that it was illegal. [23] As an Illinois court recognized, a trust beneficiary who consents to or approves of an act, omission, or transaction by a trustee, may upon the ground of waiver or estoppel be precluded from subsequently objecting to the impropriety of such act, omission, or transaction; this rule may arise from acquiescence, request, participation, or notification. [24] ¶ 27 Under this characterization of the facts, Ockey ratified the 1994 conveyance. First, in 1993, before the trust property was conveyed to IMHG, Ockey signed a document directing the trustees to convey his ownership in the ranch property to IMHG in exchange for his partnership interest in IMHG. Second, following the 1994 conveyance, Ockey accepted the benefits stemming from the contract. Consolidating ownership of the ranch in IMHG facilitated the successful development of the ranch. As a result, Ockey has received approximately two million dollars in profits, and he stands to receive more. In 1998, Ockey entered into a settlement agreement with IMHG's successor, promising that the outcome of this litigation would not affect ownership of the ranch. The settlement agreement enabled the ranch development to proceed and allowed Ockey to continue to profit from the development. These two facts demonstrate that Ockey acquiesced in and ratified the 1994 conveyance. [25] ¶ 28 Placing the best gloss on the facts found by the district court, it is possible that when the trust terminated, Uncle Nick's role shifted from acting as a trustee to acting as an agent on behalf of Ockey and the other family members. Of course, actions that exceed the scope of agency are merely voidable, not void, and therefore capable of ratification by the principal. [26] ¶ 29 Ockey ratified the contract under this characterization of the facts as well. Ockey owned his portion of the ranch as a tenant in common with the rest of the family, all of whom were interested in developing it. In order to develop the land, specific actions were necessary. For example, the family needed to make annual payments on the State Lease, contract with developers, and make improvements on the state property. ¶ 30 In light of these responsibilities, it makes sense that an individual within the family would take the lead. The district court found that in accordance with the family's usual business practice, Uncle Nick took that role by acting as the family communicator. Between 1969 and 1995, business decisions concerning the development of the ranch generally followed a common course of dealing. Uncle Nick contacted members of the family, solicited their input, generated a consensus, and acted as the family spokesperson for decisions that were made. During this time, Ockey was obsessed with the ranch and read everything he could about it. When Ockey asked Uncle Nick questions about the ranch, Uncle Nick directed him to the relevant records concerning the ranch, which were stored in an office that Ockey and Uncle Nick shared. ¶ 31 As we stated in Bradshaw v. McBride, a principal may not be wilfully ignorant, nor may he purposely shut his eyes to means of information within his possession and control and thereby escape ratification. [27] Ockey was thirty-six when the 1994 conveyance took place. He had access to all relevant records concerning his ownership of the ranch and he signed a document directing Uncle Nick and the other trustees to transfer his real property interest to the holding company. Ockey's failure to object to the 1994 conveyance constitutes ratification  either consciously or through willful ignorance  of the actions taken on his behalf. ¶ 32 The purpose of doctrines like ratification and apparent authority is to avoid instances where a technicality can be used to evade a contract despite the expectations of both parties. It is well established in our case law that an individual cannot go along with a contract for the purpose of enjoying benefits that although not directly conferred by the contract, are nevertheless made possible as a result of the contract, only to later claim a right to rescind when he discovers the benefits ... will not be great enough to compensate him for the loss he will sustain by reason of the fraud. [28] Ockey's entire argument regarding the illegality of the 1994 conveyance rests on the premise that when the trust terminated in 1986, ownership vested in him, rendering the latter conveyance void. But because the 1994 conveyance was merely voidable, it was capable of ratification by Ockey. Ockey ratified the conveyance by directing the trustees to convey his interest to IMHG in exchange for a partnership interest in IMHG and by accepting the benefits of his family's efforts to develop the ranch. For these reasons, we uphold the district court's determination that Ockey ratified the 1994 conveyance and affirm the court's summary dismissal of his quiet title and declaratory relief claims.