NO. 4-03-0810

IN THE APPELLATE COURT

OF ILLINOIS

FOURTH DISTRICT

Plaintiff, Patricia Greeling, and Margaret Cooper werejoint tenants of a certificate of deposit purchased by EveretteCooper, Margaret's husband and plaintiff's father by a previousmarriage. Soon after Everette died, Margaret and her son by aprevious marriage, Harry Joe Abendroth, went to the bank and, although the certificate of deposit was still in plaintiff's possession, persuaded the bank to cash it. With the proceeds, Margaretpurchased a new certificate of deposit payable to herself, Abendroth,and Debbie Brashears. Margaret has since passed away.

When the bank refused to pay her, plaintiff sued Abendrothindividually and in his capacity as the executor of Margaret'sestate, seeking to recover under section 4 of the Joint Tenancy Act(Act) (765 ILCS 1005/4 (West 2000)). (We will refer to Abendroth inhis two capacities as "defendants." In his individual capacity, wewill call him "Abendroth.") At the conclusion of a trial, the trialcourt entered judgment against defendants and in plaintiff's favor inthe amount of half the principal and accrued interest of the newcertificate of deposit.

Defendants appeal on the following grounds: (1) by itsterms, the certificate of deposit purchased by Everette allowedMargaret to cash it in and keep the proceeds; (2) because section 4applies only to actions between cotenants, Abendroth cannot incurliability under that section; and (3) Brashears, not named as adefendant in this case, was a necessary party.

We hold that while plaintiff had possession of the certificate of deposit, Margaret could not rightfully cash it. The trialcourt could have reasonably found that by inducing the bank to payMargaret without the surrender of the certificate according to itsterms, Abendroth committed the common-law tort of intentional interference with a contractual relationship. The court did not awardplaintiff any interest in the new certificate of deposit; rather, itawarded her a money judgment payable out of no particular source, andtherefore Brashears is not a necessary party. We affirm.

Everette bought the certificate of deposit on January 26,2002, for $99,449.26 and made it payable to "Everette Cooper orMargaret Cooper or Patricia Greeling." It matured on April 4, 2002. On its face, the certificate expressly incorporated "the [a]dditional[t]erms and [c]onditions stated on the reverse," including thefollowing:

"JOINT CERTIFICATES: When two or more persons are named as depositors on this[c]ertificate with the conjunction 'or' appearingbetween names, then such [c]ertificate shall bepayable to any of the survivor or survivors ofthem[,] and payment may be made[,] upon surrenderof this [c]ertificate[,] to any of them duringthe lifetime of all, or to any survivor orsurvivors after the death of one or more of them. When the conjunction 'and' appears between names,the [c]ertificate shall be payable only upon thesignatures of all depositors named."

About three weeks before his death, Everette delivered thecertificate of deposit to plaintiff in the presence of Margaret. After Everette's death on January 17, 2003, plaintiff still had thecertificate in her possession.

On January 26, 2003, Margaret and Abendroth went to thebank and said they wanted to cash the certificate of deposit, whichat that time had a face amount of $100,420.93. The bank officerasked where the certificate of deposit was. Abendroth testified:

"We said that it was still being held by[plaintiff], and it was supposed to be in the[lock]box, and the certificate that was returnedto us, as we said before, we asked for this threetimes, and my mother asked for the [lockbox]returned three times. When the [lockbox] wasreturned, the [certificate of deposit] was notenclosed. And that, I would think, is mymother's property."

The bank allowed Margaret to cash the certificate ofdeposit on condition that she sign an indemnity bond, which stated"the said certificate of deposit is supposed to be lost" and in whichshe promised to "deliver up said certificate of deposit[,] whenfound, to said bank." Margaret signed the bond, and the bank paidher the proceeds, $99,449.26, which she used to buy a new certificateof deposit payable to "Margaret Cooper or Harry Abendorth [sic] orDebbie Brashears." A "Debit" of the account, signed by a bankofficer, reads: "CD [(certificate of deposit)] [l]ost."

The $99,449.26 was calculated as follows: the faceamount of the old certificate of deposit, $100,420.93, plus theaccrued interest, $308.69, minus a penalty, $1,280.36.

In its judgment order, the trial court awarded plaintiffhalf the principal of the new certificate of deposit, $49,724.63,plus accrued interest. The court reasoned that if one accepteddefendants' position, "the outcome of the case would depend on whichsurvivor whose name appeared on the joint [c]ertificate of [d]epositarrived at the bank ahead of the other. Surely the law does not andcannot rest upon such a frivolous basis[] and one wholly lacking inreason or substance." Everette, the court found, intended "that hiswife and daughter share those proceeds equally."

This appeal followed.

A. Is Plaintiff "Aggrieved" Within the Meaning of Section 4?

On the authority of section 4 of the Act (765 ILCS 1005/4(West 2000)), the trial court ordered defendants to pay plaintiffdamages in the amount of one-half the value of the principal andaccrued interest represented by the new certificate of deposit. Thatstatute provides:

"If any person shall assume and exerciseexclusive ownership over, or take away, destroy,lessen in value, or otherwise injure or abuse anyproperty held in joint tenancy ***, the partyaggrieved shall have his civil action for theinjury in the same manner as he would have ifsuch joint tenancy *** did not exist." 765 ILCS1005/4 (West 2000).

(The court also relied on section 4a of the Act (765 ILCS 1005/4a(West 2000)), but that section was actually irrelevant because itapplied only to cotenants of realty (see Reichmann v. Reichmann, 5Ill. App. 3d 645, 646-47, 283 N.E.2d 734, 735-36 (1972)).)

In common law, one cotenant of a chattel could not maintainan action against another cotenant to gain possession of the chattel,even though the latter cotenant was acting like the chattel's soleowner and excluding the former cotenant from all use and enjoyment ofit. Benjamin v. Stremple, 13 Ill. 466, 468 (1851); Butte & BostonConsol. Mining Co. v. Montana Ore Purchasing Co., 25 Mont. 41, 72-73,63 P. 825, 828 (1901) (construing the Illinois statute, which Montanahad adopted). The reason was that the common law deemed possessionby one cotenant as possession by both. Benjamin, 13 Ill. at 468. Byenacting section 4, the legislature modified the common law to givethe economically injured cotenant the same legal remedies that anyother property owner would have. Benjamin, 13 Ill. at 468; GermanNational Bank v. Meadowcroft, 95 Ill. 124, 130 (1880).

Like any other plaintiff in a "civil action," the plaintiffmust be "aggrieved" (765 ILCS 1005/4 (West 2000)), that is, theplaintiff must "suffer[] from an infringement or denial of legalrights" (Merriam-Webster's Collegiate Dictionary 23 (10th ed. 2000)). If a cotenant assumes and exercises exclusive ownership over thechattel pursuant to a contract binding on the other cotenant, thelatter cotenant is not "aggrieved" or "injured" within the meaning ofany recognizable legal theory. Sondin v. Bernstein, 126 Ill. App. 3d703, 708, 467 N.E.2d 926, 930 (1984). A joint-tenancy certificate ofdeposit is "subject to the provisions of the contract between thebank and its depositor[]." Pescetto v. Colonial Trust & SavingsBank, 111 Ill. 2d 314, 317, 489 N.E.2d 1365, 1366 (1986) (referringto a "joint bank account").

If, as in the present case, the trial court construes acontract as a matter of law, our standard of review is de novo: weconstrue the contract without deference to the trial court'sconstruction. Bank of Ravenswood v. Polan, 256 Ill. App. 3d 470,474, 628 N.E.2d 194, 197 (1993).

The signers of the certificate of deposit, Everette and thebank, were the two contracting parties. Everette was the creditor,the bank was his debtor, and the nonnegotiable certificate of depositwas evidence of the bank's contractual promise to him to repay theloan with interest. See Drenckpohl v. Barker, 253 Ill. App. 3d 203,210, 625 N.E.2d 651, 656 (1993). On its face, immediately above thesignatures, the certificate of deposit states: "The undersigned ***agree[] to the [a]dditional [t]erms and [c]onditions stated *** onthis [c]ertificate, [e]specially including the [a]dditional [t]ermsand [c]onditions stated on the reverse." Because Everette and thebank intended to make the terms on the reverse side of thecertificate of deposit part of the contract for payment of money,those terms are part of the contract, just like the terms on thefront. See Drenckpohl, 253 Ill. App. 3d at 210, 625 N.E.2d at 656.

According to the terms on the back of the certificate ofdeposit, if the conjunction "or" appears between the names of thepayees, "payment may be made[,] upon surrender of this certificate[,]to any of them." (Emphasis added.) In context, the permissive word"may" corresponds not to the surrender of the certificate of depositbut to the bank's discretion to pay one as opposed to all of thepayees.

In Drenckpohl, 253 Ill. App. 3d at 210, 625 N.E.2d at 656,the Fifth District construed three certificates of deposit containingthe same boilerplate provisions as the one in this case. Theconjunction "or" likewise appeared between the payees' names. Drenckpohl, 253 Ill. App. 3d at 205, 625 N.E.2d at 652-53. Theappellate court stated as follows:

"The provision on the back of thecertificates of deposit *** permits any one ofthe joint tenants to receive payment on theinstruments by surrendering them to [the] [b]ank. This provision conferred a benefit to each jointtenant as any of them could have received paymentupon surrender of the certificates to [the][b]ank." (Emphases added.) Drenckpohl, 253 Ill.App. 3d at 210, 625 N.E.2d at 656.

Again emphasizing the surrender of the certificates of deposit, theappellate court stated as follows:

"According to the terms incorporated intothe certificates of deposit, Velma Drenckpohl waspermitted to invade the corpus of thecertificates of deposit to the detriment of theother joint tenants. *** [She] was perfectlywithin her right as a joint tenant, under theterms of the certificates of deposit, tosurrender the certificates of deposit forpayment." (Emphasis added.) Drenckpohl, 253Ill. App. 3d at 210, 625 N.E.2d at 656.

Defendants rely heavily on Drenckpohl, even quoting thosepassages. They argue that under the "Terms and Conditions" on thereverse side of the certificate of deposit, Margaret, too, could"surrender the certificate at any time and *** receive the entireproceeds." (Emphasis added.) To "surrender" something means to"giv[e] up the possession of [it,] esp[ecially] into the power ofanother" (Merriam-Webster's Collegiate Dictionary 1183 (10th ed.2000)): "the act of redelivering the instrument to the obligor" (15W. Jaeger, Williston on Contracts