Court Opinion

ID: 9412846
Source: CourtListenerOpinion
Date Created: 2023-08-01 19:06:43.282331+00
Date Added: 2024-06-11T16:39:27.269911
License: Public Domain

2023 IL App (5th) 220630
            NOTICE
 Decision filed 08/01/23. The
 text of this decision may be              NO. 5-22-0630
 changed or corrected prior to
 the filing of a Peti ion for
 Rehearing or the disposition of
                                              IN THE
 the same.
                                   APPELLATE COURT OF ILLINOIS

                               FIFTH DISTRICT
______________________________________________________________________________

In re ESTATE OF JOHN C. HIRSCHFELD, Deceased    )     Appeal from the
                                                )     Circuit Court of
(Laura L. Hollis, John S. Hirschfeld,           )     Champaign County.
Christopher C. Hirschfeld, Jennifer E. Ryan,    )
Adam B. Hirschfeld, Catherine P. Murphy, and    )
Robert F. Hirschfeld,                           )
                                                )
       Petitioners-Appellants,                  )
                                                )
v.                                              )     No. 14-P-333
                                                )
Mary E. Hirschfeld,                             )     Honorable
                                                )     Gary A. Webber,
       Respondent-Appellee).                    )     Judge, presiding.
______________________________________________________________________________

         JUSTICE MOORE delivered the judgment of the court, with opinion.
         Justices Welch and Vaughan concurred in the judgment and opinion.

                                            OPINION

¶1       The appellants, Laura L. Hollis, John S. Hirschfeld, Christopher C. Hirschfeld, Jennifer E.

Ryan, Adam B. Hirschfeld, Catherine P. Murphy, and Robert F. Hirschfeld (petitioners), appeal

the circuit court of Champaign County’s August 30, 2022, order, which dismissed with prejudice,

pursuant to section 2-615 of the Code of Civil Procedure (735 ILCS 5/2-615 (West 2018)), the

petitioners’ citation to recover assets against Mary E. Hirschfeld (respondent), second wife and

widow of John C. Hirschfeld (decedent). The citation to recover assets asserted claims of breach

of fiduciary duty and conversion based upon the legal theory that transfers of the decedent’s assets

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overseen by the respondent were presumptively fraudulent because the transfers were effectuated

for the respondent’s sole benefit while holding and acting upon a written power of attorney. Also

alleged was a count for criminal financial exploitation; however, that claim has been abandoned

and is not at issue in this appeal. For the following reasons, we reverse and remand.

¶2                                   I. BACKGROUND

¶3     The decedent was born on August 5, 1936, and died on November 30, 2014, at the age of

78. During his life, the decedent was an attorney and principal in the Champaign law firm of Meyer

Capel until May 15, 2000. The petitioners in this lawsuit are the children of the decedent with his

first wife, Rita. The decedent and Rita were divorced on August 11, 1998. The decedent then

married the respondent on May 29, 1999, and the two were married for approximately 15 years

before the decedent’s death.

¶4     On December 18, 2014, the respondent filed a petition for probate of will, along with the

“Last Will and Testament of John C. Hirschfeld” dated August 22, 2006 (2006 will). The 2006

will was admitted to probate by the circuit court, and letters testamentary were issued on December

23, 2014, and certified on December 29, 2014.

¶5     The contested matters began on January 30, 2015, when the petitioners filed a “Petition to

Terminate Independent Administration.” That petition was granted by the circuit court on May 27,

2015. On May 26, 2015, the petitioners filed a “Petition for Accounting and for a Citation to

Discover Information,” which was later amended on October 21, 2015, relating to the respondent’s

previous status and duties as attorney-in-fact and power of attorney for the decedent. In response,

on July 2, 2016, the respondent filed section 2-615 and 2-619 motions to dismiss the petition for

accounting. Additionally, on June 18, 2015, the petitioners filed a “Petition to Contest Validity of

and Set Aside Will with Jury Request” (will contest), which was later amended on February 19,

                                                 2
2016. The will contest alleged that the 2006 will of the decedent admitted to probate was invalid

due to the decedent’s lack of testamentary capacity and/or due to fraud in the inducement or undue

influence by the respondent.

¶6      Subsequent to this activity within the case, numerous additional filings and challenges

occurred related to the aforementioned pleadings. On August 11, 2017, the circuit court ordered

the respondent to comply, in part, with the “Petition for Accounting and for a Citation to Discover

Information.” This resulted in the respondent disclosing approximately 20,000 pages of documents

on October 16, 2017, related to the finances and expenses of the decedent and the respondent

during the later years of the decedent’s life. On July 19, 2019, the circuit court granted the

respondent’s motion for summary judgment dismissing the petitioners’ will contest petition. This

ruling was appealed and subsequently affirmed by our colleagues in the Fourth Appellate District

prior to this court’s redistricting.

¶7      During the will contest proceedings, the petitioners conducted a forensic review of the

disclosed financial documents produced by the respondent pursuant to the court order of August

11, 2017, allowing partial discovery. Following the review, the petitioners claimed they discovered

“years of transfers and dispositions of [the decedent’s] assets by [the respondent] to herself, which

she authorized or effectuated for her own benefit, and which depleted [the decedent’s] estate to the

point where just over $200,000 remained at the time of his death from the nearly $3,000,000 [the

decedent] had in non-marital assets at the time of his marriage to [the respondent].” Further, the

petitioners claimed that they discovered that these “transactions took place when the written power

of attorney which [the decedent] had executed on March 24, 2000, naming [the respondent] as

attorney-in-fact was in effect.”

                                                 3
¶8     As a result of this alleged discovery, on April 23, 2019, the petitioners filed a “Petition for

Issuance of Citation to Recover Assets” (petition to recover) against the respondent, along with

the citation itself (citation to recover) and approximately 2000 pages of exhibits in support of their

allegations. Within the petition to recover, the petitioners alleged breach of fiduciary duty,

conversion, and financial exploitation by the respondent as it related to her role as wife and

attorney-in-fact of the decedent. The petitioners requested, inter alia, the removal of the

respondent as executor of the decedent’s estate, for all sums of money and property improperly

taken to be returned to the estate, and damages.

¶9     In response, the respondent filed a motion to dismiss the petition to recover pursuant to

section 2-615 of the Code of Civil Procedure (735 ILCS 5/2-615 (West 2018)). On June 5, 2019,

the petitioners filed a motion to strike the respondent’s motion to dismiss as procedurally improper.

The circuit court agreed, and on July 19, 2019, the circuit court issued the citation to recover to

the respondent. Following that, the petitioners withdrew their motion to strike, and the

respondent’s motion to dismiss was recast as a section 2-615 motion to dismiss the citation to

recover, instead of the petition. The circuit court also granted the petitioners’ request for removal

of the respondent as executor of the decedent’s estate, and James M. Lestikow, Esquire, of

Hinshaw Culbertson was later appointed to serve as special administrator on approximately

October 25, 2019.

¶ 10   On November 4, 2019, the petitioners filed their response to the respondent’s motion to

dismiss the citation to recover. Additionally, following an extension granted by the circuit court,

the special administrator, Mr. Lestikow, filed his response on January 10, 2020. Mr. Lestikow’s

response argued against the dismissal of the breach of fiduciary duty and conversion claims as

alleged in the petitioners’ citation to recover. Chief among his reasoning for his recommendation

                                                   4
was (1) the existence of a prenuptial agreement signed by the decedent and the respondent shortly

before their marriage; (2) the existence of a written power of attorney, and his interpretation of

Illinois law that fiduciary duties existed on the respondent’s part as a result; (3) the declining health

of the decedent during the relevant time period contained within the petitioners’ citation to recover;

(4) the amount of assets transferred into the respondent’s sole control; (5) the inadequacy of the

respondent’s accounting as required under the Illinois Power of Attorney Act (755 ILCS 45/1-1

et seq. (West 2018)); and (6) the allegations and appearance that the transactions in question were

effectuated by the respondent and not by the decedent.

¶ 11    The circuit court held a hearing on the respondent’s motion to dismiss the petitioners’

citation to recover on January 24, 2020. During the hearing, the petitioners argued that as an

attorney-in-fact pursuant to the March 2000 written power of attorney between the decedent and

the respondent, the respondent was acting under a fiduciary duty to the decedent when transferring

or handling his assets. All of the actions taken by her with regard to the decedent’s estate after the

time the power of attorney came into effect, wherein she personally benefited, were a breach of

this fiduciary duty, and thus, presumptively fraudulent self-dealing. It was therefore the

petitioners’ position that under appliable Illinois law, the presumption of fraud applied to the

transactions and the burden rested on the respondent to show by clear and convincing evidence

that the decedent intended those transactions by which she benefited to be gifts or otherwise proper

expenditures.

¶ 12    In response, the respondent argued that as the wife of the decedent, she was not subject to

the same presumption and fiduciary duties as nonspouses would be under a written power of

attorney. In fact, she argued that she was entitled to a presumption of a gift on all transfers by her

of the decedent’s property to herself as his spouse. Therefore, she contended that the petitioners

                                                   5
held the pleading burden to specifically allege how the transactions complained of were fraudulent

or wrongful.

¶ 13   Special administrator Mr. Lestikow also expressed concerns regarding potential abuse that

could be allowed or created where, such as in this matter, there is a written power of attorney that

is not activated by a specific event or occurrence. This was especially concerning to him where

the decedent is in a subsequent marriage, has children from a prior marriage, and has drafted a

prenuptial agreement expressly providing that his and his new spouse’s assets were to remain

separate.

¶ 14   Ultimately, the circuit court agreed with the respondent, relying on her interpretation of the

relevant case law, specifically a 1951 supreme court case, Miethe v. Miethe, 410 Ill. 226, 231

(1951). The respondent relied upon specific language in the Miethe court’s decision to support her

position:

               “The general rule is that where a fiduciary relationship has been established, the

       burden rests upon the fiduciary to show the fairness of the questioned transaction. The rule

       that a presumption of undue influence is raised by the existence of the fiduciary relation,

       however, is not applicable to conveyances from husband to wife.” Id.

The circuit court went on to hold that, notwithstanding the existence of a power of attorney under

which the respondent was acting, it was going to examine the arguments and sufficiency of the

pleading “under the theory that the presumption will apply between a husband and wife that—of

a gift and not a presumption of impropriety.”

¶ 15   Following that finding, counsel for the petitioners asked the court for leave to replead in

light of the circuit court’s finding of the presumption of a gift applying. They also indicated that

they were not seeking leave to replead count III of the citation to recover. The circuit court then

                                                 6
granted the motion to dismiss, dismissing count III with prejudice, and allowed the petitioners the

opportunity to replead counts I and II.

¶ 16    On February 28, 2020, the circuit court held a telephone conference with the parties

wherein the petitioners informed the court that in light of the circuit court’s finding that a

presumption of a gift applied, they no longer wished to replead and instead requested the circuit

court convert its January 24, 2020, action with regards to counts I and II, wherein it gave leave to

replead, to a dismissal of all counts with prejudice so that they could immediately appeal. The

circuit court granted the request and entered an order on April 6, 2020. However, due to the

language used within that order, when an appeal was taken on the issue, our colleagues in the

Fourth District found that a final order had not yet been entered and dismissed the appeal due to a

lack of jurisdiction.

¶ 17    Subsequently, on August 30, 2022, the circuit court ended an amended order wherein it

found that

        “because Decedent and Respondent were spouses, the presumption of a gift applies to all

        transaction challenged in Counts I and II of the Citation to Recover including: (a) those

        where Respondent transferred Decedent’s property to herself acting as agent under an

        operative Power of Attorney, and (b) those where Respondent allegedly directed Decedent

        to transfer property to her for her benefit while she was acting as agent under an operative

        Power of Attorney.”

The circuit court noted that “Petitioners acknowledge that Count I and Count II of the Citation to

Recover fail to state a claim if the presumption of gift applies to all transactions identified in Count

I and Count II of the Citation to Recover.” It then held that “the Petition fails to state a claim as a

matter of law as to Count I for Breach of Fiduciary Duty and Count II for Conversion, such that

                                                   7
Count I and Count II are dismissed with prejudice.” It then reaffirmed its dismissal with prejudice

of count III.

¶ 18    Petitioners then filed this timely appeal on September 23, 2022. Additionally, we note that

various facts surrounding the circumstances and transactions themselves are disputed by the

parties. For brevity, we have not recited all these issues within our facts recitation; however, where

relevant, we will include and discuss these issues and facts below. Further, the special

administrator, Mr. Lestikow, has entered his appearance in this appeal but has not filed any briefs

or indicated his position outside of the statements he made within the circuit court.

¶ 19                                    II. ANALYSIS

¶ 20    While the manner in which this case has come before us is somewhat unconventional, given

the petitioners requesting an entry of dismissal with prejudice and conceding the insufficiency of

their pleading when viewed under a presumption of a gift in order to facilitate an appeal, the

petitioners place before us a single question: Whether the circuit court erred when it found as a

matter of law that the presumption of undue influence or fraud does not apply to a spouse holding

a power of attorney who engages in alleged self-dealing. We find that it did.

¶ 21    “A section 2-615(a) motion dismissal is reviewed de novo.” Reynolds v. Jimmy John’s

Enterprises, LLC, 2013 IL App (4th) 120139, ¶ 25. A motion to dismiss under section 2-615 of

the Code of Civil Procedure alleges defects on the face of a complaint that amount to legal

insufficiency. 735 ILCS 5/2-615(a) (West 2018). “A citation petition seeking the recovery of

property must make out cognizable legal claims against the respondent, just like any other

complaint.” In re Estate of Yanni, 2015 IL App (2d) 150108, ¶ 28. In reviewing the sufficiency of

a complaint, courts must accept as true all well-pleaded facts and reasonably drawn inferences in

the light most favorable to the plaintiff. Doe v. Chicago Board of Education, 213 Ill. 2d 19, 29

                                                  8
(2004). However, conclusions of law will not be assumed true unless supported by specific factual

allegations. Jarvis v. South Oak Dodge, Inc., 201 Ill. 2d 81, 86 (2002).

¶ 22   The petitioners requested that the circuit court enter its section 2-615 dismissal with

prejudice and conceded the insufficiency of their citation to recover when viewed under a

presumption of a gift. Because of this, we cannot consider any issue as to whether the citation to

recover contained facts sufficient to overcome the petitioners’ burden while analyzing the pleading

under a presumption of a gift. The petitioners have expressly waived any such issue by conceding

that their citation to recover was insufficient. Thus, we need only to answer the question of whether

the circuit court erred in finding that the presumption of a gift applied in this matter.

¶ 23   During the hearing on the section 2-615 motion to dismiss, the circuit court stated that it

believed our supreme court in Miethe, 410 Ill. 226, had held the law to be “that there is a

presumption benefiting basically the spouse. In other words, *** the rule that a presumption of

undue influence is raised by the existence of the fiduciary relation is not applicable to spouses

***.” The circuit court then stated, “the supreme court [has] clarified that the power of attorney

gives rise to a common law fiduciary duty that’s codified but not altered by the Power of Attorney

Act.” The circuit court then deduced that because the common law fiduciary duty is not altered by

a power of attorney, Miethe was controlling, and that the presumption of a gift applied to

transactions between spouses.

¶ 24   On appeal, the petitioners argue that the

       “Circuit Court’s decision ignored the numerous cases cited by Petitioners in which this

       Appellate Court *** and the Illinois Supreme Court have ruled that a spouse is subject to

       the presumption of fraud in multiple circumstances, including Deason v. Gutzler, 251 Ill.

       App. 3d 630 (5th Dist. [1993]), Simon v. Wilson, 291 Ill. App. 3d 495 (1st Dist. 1997) and

                                                   9
       DeHart v. DeHart, 2013 IL 114137. Contrary to the Circuit Court’s reasoning, the courts

       in Deason, Simon and DeHart, all applied the presumption of fraud and/or undue influence

       to a spouse who held power of attorney.”

¶ 25   It is well settled that the burden of pleading and proving the existence of a fiduciary

relationship lies with the party seeking relief. Lemp v. Hauptmann, 170 Ill. App. 3d 753, 756-57

(1988) (citing Farmer City State Bank v. Guingrich, 139 Ill. App. 3d 416, 424 (1985)). “An

individual holding a power of attorney is a fiduciary as a matter of law.” In re Estate of Shelton,

2017 IL 121199, ¶ 22. “Thus, an agent appointed under a power of attorney has a common-law

fiduciary duty to the principal.” Id.; see also 755 ILCS 45/2-7(a), (b) (West 2018) (codifying the

agent’s duty of care owed to the principal for purposes of the Power of Attorney Act). “The

fiduciary relationship between the principal and agent begins at the time the power of attorney

document is signed.” Shelton, 2017 IL 121199, ¶ 22.

¶ 26   The petitioners allege that the respondent was named the power of attorney for the decedent

in a written power of attorney signed by the decedent on March 24, 2000, and that the complained-

of actions occurred pursuant to this authority. The circuit court did not specifically articulate a

direct finding that all of the transactions complained of were taken pursuant to this written power

of attorney, but seemed to indicate that it believed the actions were largely taken pursuant to this

authority. Further, some of the attached documentation shows the respondent authorizing

expenditures and transfers of assets using this authority by signing her name with “P.O.A.,” or

otherwise indicating power of attorney, indicating that she did act as the decedent’s power of

attorney.

¶ 27   Because the respondent was named the decedent’s power of attorney and is alleged to have

acted pursuant to that authority while facilitating the at-issue transactions, it is clear that the

                                                10
respondent did have a fiduciary relationship with the decedent. We now must examine how the

power of attorney and accompanying fiduciary duties effect the respondent’s subsequent

complained-of actions. It is well settled in Illinois law that

       “[t]he mere existence of a fiduciary relationship prohibits the agent from seeking or

       obtaining any selfish benefit for herself, and if the agent does so, the transaction is

       presumed to be fraudulent. [Citations.] ‘Thus, any conveyance of the principal’s property

       that either materially benefits the agent or is for the agent’s own use is presumed to be

       fraudulent.’ ” (Emphasis added.) In re Guardianship of Spinnie, 2016 IL App (5th)

       150564, ¶ 19 (quoting Spring Valley Nursing Center, L.P. v. Allen, 2012 IL App (3d)

       110915, ¶ 12, and citing Clark v. Clark, 398 Ill. 592, 601-02 (1947), Pottinger v. Pottinger,

       238 Ill. App. 3d 908, 918 (1992), and White v. Raines, 215 Ill. App. 3d 49, 59 (1991)).

This presumption of undue influence would generally shift the burden to the defending party to

show by clear and convincing evidence that the transaction was fair and equitable and that it did

not result from the exercise of improper or undue influence. Lemp, 170 Ill. App. 3d at 758.

Understanding that the typical presumption applied for fiduciaries who engage in self-dealing is

one of undue influence or fraud, we are left only to consider whether a spousal relationship defeats

that general presumption.

¶ 28   To answer this question, we first look to the Illinois Supreme Court case Miethe, 410 Ill.

226, which both the respondent and circuit court relied upon. Importantly, we note that it appears

the circuit court did not rely on the actual holding, or outcome, of Miethe to guide its ruling.

Instead, the circuit court and the respondent latched onto the following general statement made by

the supreme court within the Miethe decision:

                                                  11
               “The general rule is that where a fiduciary relationship has been established, the

       burden rests upon the fiduciary to show the fairness of the questioned transaction. The rule

       that a presumption of undue influence is raised by the existence of the fiduciary relation,

       however, is not applicable to conveyances from husband to wife.” (Emphasis added.) Id. at

       231.

There is no citation or further explanation following this statement. However, if we look previously

within the opinion, we see the Miethe court state the following:

               “Appellant’s first contention is that the conveyance of appellee’s one-half interest

       in their joint property to her is presumed in law to be an absolute gift of the property to her.

       The reason for a presumption of gift in such cases was aptly stated in the case of Wright v.

       Wright, 242 Ill. 71, where, at page 78, it was said: ‘The inference which the law permits to

       be drawn in this class of cases is based upon the common knowledge and experience of

       mankind in regard to the motives that usually accompany transactions of that character.

       Where there is a legal obligation resting on the one furnishing the consideration to support

       the person in whose name the conveyance is taken, it is said in some of the cases that the

       law will infer an intention to make a gift or an advancement, and that to establish a resulting

       trust the transaction must be attended by circumstances that negative this inference, or, as

       it has sometimes been expressed though not with entire accuracy, by circumstances

       showing an intention to create a trust.’ The relationship of husband and wife is one of such

       confidence and trust that courts will scrutinize transactions between them very closely.

       Mauricau v. Haugen, 387 Ill. 186. While confidential relationships necessarily exist

       between a husband and wife when they reside together under the ordinary conditions of

       marriage, nevertheless, it cannot be said as a matter of law that one of the parties is the

                                                 12
       dominant and the other the dependent party. Whether or not that be true is a question of

       fact. Brod v. Brod, 390 Ill. 312.” (Emphases added.) Id. at 230.

¶ 29   In Wright v. Wright, 242 Ill. 71, 78-79 (1909), referenced above by the Miethe court, the

supreme court further explained:

              “All of the cases relied on by appellant in support of the proposition that where the

       transaction is between members of the same family it is necessary to show something more

       than the furnishing of the purchase money by one and taking the title in the name of another,

       are cases where the person paying the consideration was under a legal or moral obligation

       to maintain the person to whom the conveyance is made. No case is cited, and we have

       been unable to find any, which holds that where the wife furnishes the purchase money and

       the deed is taken in the name of the husband a presumption of a gift or an advancement

       arises. There is a clear intimation in Francis v. Roades, 146 Ill. 635, and Madison v.

       Madison, 206 [Ill.] 534, that no such presumption exists. The reason upon which the

       presumption rests where the purchase money is furnished by one who is under a legal

       obligation to maintain the person in whose name the deed is taken, does not apply where

       the wife furnished the consideration for a deed taken in the name of her husband.”

¶ 30   We must examine the above statements of the law within the context of which these cases

were written considering they were authored approximately a century ago. Based upon the holding

in Wright, it is clear that the presumption arose because the supreme court was acknowledging the

reality of how a family generally functioned during that time. There generally was a husband who

worked and earned income for the family. His wife generally did not work outside of the home

and did not generate her own income. She thus was dependent upon him to provide for her. It

therefore made sense then to create a presumption of a gift within this context because the wife

                                                13
would not typically be the dominant party within the spousal relationship. Thus, where a

conveyance was made from the husband (traditionally, the dominant party, who earned the income

to procure the property, and had an obligation to provide for his wife and children) to his wife

(traditionally, the nondominant party, who likely was uneducated and lacked the same rights as

her husband), applying a presumption of undue influence or fraud did not make sense. Instead, a

presumption of a gift was more fitting and reflective of what typically occurred within that

relational context. Therefore, under the Wright framework, any conveyance initiated by the

husband (or dominant party) of property, which he had purchased with his income, to his wife (or

nondominant party) was presumed to be gifted.

¶ 31   For further explanation, we turn to a supreme court decision, Rickman v. Meier, 213 Ill.

507 (1904), which occurred just a few years prior to Wright. The Rickman court stated the

following:

              “Where, however, the natural position of the parties has become reversed, where

       the parent defers to, trusts in and yields to the child, where there exists between them what

       in law is termed a fiduciary relation, in which the parent is dominated by the child, and

       where the child prepares, or causes to be prepared and executed, an instrument conveying

       to him property of the parent, as a gift or upon a grossly inadequate consideration, the

       presumption arises that the transfer was obtained through his undue influence, and the

       burden then rests upon him to show that the conveyance was the result of full and free

       deliberation on the part of the parent. This is not peculiar to transactions where the parties

       are parent and child, but is the law in any case where a fiduciary relation exists, where the

       conveyance is from the dependent to the dominant party, and where the donee or grantee

       prepares or procures the preparation and execution of the deed or other instrument; and

                                                14
       the rule is applied, under such circumstances, wherever that relation exists, no matter

       whether the parties are related by blood or not.” (Emphasis added.) Id. at 516-17.

¶ 32   Therefore, while the Wright court explains how the presumption of a gift applies where the

“natural” or “traditional” positions of the spouses are in place, the Rickman court explains how the

presumption of undue influence and fraud applies where the power dynamic between the parties

has changed, or “the natural position of the parties has become reversed” (id. at 516), and where

self-dealing is alleged. Rickman finds that where the formerly dominant party is now the

dependent, the presumption of undue influence will apply if the newly dominant party prepares or

procures a transaction or conveyance from the newly dependent party to himself or herself,

irrespective of any familial relationship between the two parties. Stated more simply, where a

fiduciary relationship exists and the dominant party engages in self-dealing by facilitating a

conveyance of the nondominant party’s property that benefits the dominant party, the presumption

of undue influence or fraud applies despite any familial relationship between the parties. This is

exactly the set of facts we have at issue in this appeal.

¶ 33   Turning back to Miethe with this context and clearer understanding, we can see that the

Miethe court’s statement that “The rule that a presumption of undue influence is raised by the

existence of the fiduciary relation, however, is not applicable to conveyances from husband to

wife” (Miethe, 410 Ill. at 231) was just a recitation of the law as stated in Wright. In other words,

where spouses have a fiduciary relationship, and the husband, or dominant or equal party, makes

a conveyance to his wife, or nondominant or equal party, the presumption of a gift will apply.

Thus, the Miethe court was simply analyzing the situation presented to it under the framework as

outlined above. However, it appears the circuit court overlooked the nuances of the framework.

                                                  15
The Miethe court highlighted the nuances of the framework right after it discussed the Wright case

when it stated:

       “While confidential relationships necessarily exist between a husband and wife when they

       reside together under the ordinary conditions of marriage, nevertheless, it cannot be said

       as a matter of law that one of the parties is the dominant and the other the dependent party.

       Whether or not that be true is a question of fact.” Id. at 230.

Here, the Miethe court was highlighting the reality that not every spousal relationship and power

dynamic was the same and that in some marriages the wife was the dominant party and in some

neither party was dominant. The Miethe court therefore rightly reiterated that transactions between

spouses must be scrutinized to determine if one is dominant over the other. If one is, and they are

the party conveying the property, then it is a gift. Likewise, if neither is dominant and the spouses

are equals, a conveyance will be presumed a gift. However, where the roles have reversed and the

previously nondominant party is now dominant and is conveying the property of the newly

nondominant party to themselves, the presumption of undue influence applies. This is what the

Miethe court held.

¶ 34   Although we acknowledge that the facts in Miethe are different from the present facts, we

nevertheless find analysis of it to be helpful. Miethe involved a dispute over land between a

husband and his estranged wife. The husband worked in a coal mine and generated the income for

the family but only had a second-grade education. Id. at 231. The wife, however, was educated

and handled the family’s finances and invested the income her husband generated. Id. The two

purchased various properties and homes with the husband’s income, and the wife oversaw these

properties with help from her husband. Id. One day, the husband spent all day drinking at a local

tavern. Id. at 232. He became intoxicated, got into a brawl, and was arrested. Id. His wife bailed

                                                 16
him out of jail the next morning and took him to a nearby doctor for treatment. Id. Following the

visit to the doctor, the wife convinced the husband to deed her all of the property held in his name

because he had gone on these binges many times and she was afraid his mischief would cause

them to lose everything they had worked for. Id. He agreed and deeded his property over to her.

Id. at 233. The husband filed the lawsuit seeking to reclaim his portion of property following

marital strife between the parties. Id. at 229-30. The husband contended that he did not even

remember signing the deed and put forth evidence that he sustained a legitimate head injury in the

brawl. Id. at 232-33.

¶ 35   The Miethe court found the following:

       “Keeping in view the relationship of the parties, the facts and circumstances surrounding

       the execution of the deeds in question, the relationship of the parties in their business

       affairs, the provision already made for the wife, her agency in procuring the conveyance

       to herself, and the transfer of the title to his entire estate in the late years of his life without

       making any provision for his own future, impels us to agree with the chancellor that the

       evidence amply rebuts the inference that the conveyance to appellant was intended as a gift

       to her of appellee’s one-half interest in the property.” (Emphasis added.) Id. at 234.

¶ 36   The Miethe court initially applied the presumption of a gift but ultimately found that the

wife’s actions and self-dealing rose to the level to rebut that presumption. The supreme court

applied the presumption of a gift initially because the husband and wife stood in traditional roles

with a more traditional power structure (he was the sole breadwinner), until you looked more

closely (she handled all of the finances and income investments). Also, there was no reversal of

roles or shift in dynamics prior to the conveyance. Further, the husband signed the deed actually

conveying the property to his wife, she did not convey it herself, although she did prepare the

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materials for him to authorize. Thus, the court operated under the assumption of gift until it was

shown that the wife did hold a dominant position over her husband and had obtained his property

through self-dealing. Moreover, it is important to note that the court in Miethe had to determine if

a fiduciary relationship even existed. There was no Power of Attorney Act in existence at this time,

so the fiduciary relationship could have only arisen via the nature of the parties’ relationship.

Obviously, the facts of Miethe are not very similar to the facts at hand, but the case clearly

articulates the law that a court is to examine the existence of a fiduciary relationship between the

parties, the nature of the spouses’ relationship, who initiated the conveyance that is at issue,

determine which, if either, holds a dominant position, and whether self-dealing occurred.

¶ 37   That brings us to the present matter and we look to the allegations as set forth by the

petitioners in their citation, which we must take as true when analyzing a section 2-615 dismissal

(Doe, 213 Ill. 2d at 28). The parties entered into a prenuptial agreement prior to marriage, which

kept certain assets held by the decedent from becoming marital property. The decedent entered the

marriage with considerably more wealth than the respondent. Thus, it appears that initially during

the marriage the decedent held a more dominant position in the spousal relationship than the

respondent. However, the decedent became ill and his physical and mental capacity began to fail.

This precipitated the creation of a power of attorney so that the respondent could care for the

decedent as his health failed. The petitioners allege extensively within their citation how the

decedent’s mental and physical condition began to fail. The decedent eventually became dependent

upon the respondent for his everyday needs, especially transportation to his doctor’s appointments.

At this point in the marriage, the power dynamic shifted. The respondent was now the power of

attorney for the decedent, which created a fiduciary duty, and she was in the dominant position as

the decedent’s mental and physical health began to fail. The petitioners allege that the respondent

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used her new authority under the power of attorney and the decedent’s impaired state to her

advantage and began converting and conveyancing the decedent’s assets into her own. This

resulted in the decedent’s estate being reduced from approximately $3 million at the start of the

marriage to only $200,000. We acknowledge that much of the petitioners’ characterization of these

events is disputed by the respondent; however, we must take as true the well-pleaded allegations

of the citation to recover. Id. Therefore, applying the framework as outlined above, we find the

presumption of undue influence or fraudulent transfer applies as it always would where the

conveyance is from the dependent party to a dominant party and where the dominant party—the

donee—procures it. We find this especially true in this matter considering the existence of a

prenuptial agreement, the declining health of the decedent during the relevant times, the size of the

assets that were conveyed or expended, and that all the complained-of transactions were facilitated

by, or solely taken by, the respondent, by which she then benefited. This outcome is further

supported when considering the inadequacies of the respondent’s accounting, which was required

pursuant to the Power of Attorney Act.

¶ 38      We note as well that the record on appeal appears to present a possible alternative reason

to reverse the circuit court’s order and remand for further proceedings. Of relevance to this possible

alternative reason, the written power of attorney signed by the decedent in March 2000 specifically

states:

          “To the extent my attorney thinks I might have done, to make, unconditionally or upon

          such terms and conditions as my attorney shall think fit, such gifts to any one or more of

          those persons consisting of my spouse, my descendants and the spouses of my descendants

          in my attorney’s sole discretion and for any reason my attorney determines.

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        Notwithstanding the foregoing, my attorney shall not be empowered to make gifts to himself

        or those persons to whom he has a general obligation of support.” (Emphasis added.)

¶ 39    “A written power of attorney must be strictly construed so as to reflect the ‘clear and

obvious intent of the parties.’ ” Fort Dearborn Life Insurance Co. v. Holcomb, 316 Ill. App. 3d

485, 499 (2000) (quoting Crawford Savings & Loan Ass’n v. Dvorak, 40 Ill. App. 3d 288, 292

(1976), citing McHarry v. Bowman, 274 Ill. App. 487 (1934)). In this case, it would appear that a

strong argument could be made that the power of attorney, as written, expressly prohibited the

respondent from making any gifts to herself using her capacity as the decedent’s attorney and that,

accordingly, the presumption of a gift cannot apply because the power of attorney pursuant to

which the respondent made the at-issue conveyances specifically prohibited self-dealing in the

form of self-gifting. However, the parties have not raised, either in the circuit court or before this

court, this possible alternative reason to reverse and remand. Therefore, we conclude that they

have forfeited consideration of this possible alternative reason to reverse and remand. See Village

of Roselle v. Commonwealth Edison Co., 368 Ill. App. 3d 1097, 1109 (2006) (generally, arguments

not raised before the circuit court are forfeited and cannot be raised for the first time); Ill. S. Ct. R.

341(h)(7) (eff. Oct. 1, 2020) (argument shall contain the contentions of the appellant and the

reasons therefor, with citation of the authorities and the pages of the record relied on; points not

argued are forfeited).

¶ 40    For all of these reasons, we find that the circuit court erred when it found as a matter of

law that the presumption of undue influence or fraud does not apply to a spouse holding a power

of attorney who engages in alleged self-dealing.

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¶ 41                                 III. CONCLUSION

¶ 42   For the foregoing reasons, we reverse the August 30, 2022, order of Champaign County

dismissing the petitioners’ citation to recover assets and remand to the circuit court to review the

citation to recover in light of the proper applicable presumption.

¶ 43   Reversed and remanded.

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                 In re Estate of Hirschfeld, 2023 IL App (5th) 220630

Decision Under Review:    Appeal from the Circuit Court of Champaign County, No. 14-P-
                          333; the Hon. Gary A. Webber, Judge, presiding.

Attorneys                 Eric Dorkin, of Clark Hill PLC, of Chicago, and Laura L. Hollis,
for                       of Granger, Indiana, for appellants.
Appellant:

Attorneys                 John E. Thies and Daniel R. Thies, of Webber & Thies, P.C., of
for                       Urbana, for appellee.
Appellee:

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