STATE OF ILLINOIS



IN THE CIRCUIT COURT OF COOK COUNTY, ILLINOIS

COUNTY DEPARTMENT, CHANCERY DIVISION

IN RE THE MATTER OF )

)

MARY DOE, Trustee, )

) No. _____CH_______

and )

)

JANE DOE Beneficiary )

VERIFIED COMPLAINT FOR TRUST REFORMATION BASED UPON SCRIVENER’S ERROR AND OTHER GROUNDS

Now comes MARY DOE, as Trustee of the Jane Doe Special Needs Irrevocable Pay Back Trust dated August 5, 2001, by and through her attorneys, The Elder Law Office of Steven C. Perlis and Associates, P.C., and presents this verified complaint for trust reformation, and in support thereof states as follows:

1. JANE DOE resides at 123 Main Street, Anytown, in Cook County, Illinois. She is the beneficiary of the Jane Doe Special Needs Irrevocable Pay Back Trust dated August 5, 2001.

2. JANE DOE is now 46 years old. She is a “disabled” person as defined by the Social Security Act at 42 U.S.C. §1382c(a)(3), due to schizo-affective disorder. JANE DOE receives benefits under various needs-based programs as a result of her disability. These include Medicaid (Medical Assistance) from the Illinois Department of Healthcare and Family Services, and Supplemental Security Income from the Social Security Administration.

3. JANE DOE’s father, John Doe (“John”) was the Grantor of the Jane Doe Special Needs Irrevocable Pay Back Trust dated August 5, 2001 (“SPECIAL NEEDS TRUST”). A copy of the trust is attached to this Complaint as Exhibit A.

4. Mary Doe, JANE DOE’s sister, serves as Trustee of the SPECIAL NEEDS TRUST.

5. JANE DOE’s mother, Susan Doe (“SUSAN”), passed away on October 31, 2002. SUSAN’s assets passed in accordance with her Trust Agreement dated August 5, 2001. A portion of SUSAN’s assets were distributed to a Marital Trust for JOHN’s benefit, with the remaining portion funding the Doe Family Share. Fifty percent of the Doe Family Share was distributed to the SPECIAL NEEDS TRUST, with the remaining fifty percent divided equally between JOHN and SUSAN’s four other daughters.

6. The SPECIAL NEEDS TRUST may be funded with additional funds in the future. The Marital Trust created under SUSAN’s trust states that upon JOHN’S death, fifty percent of the balance is to be distributed to the SPECIAL NEEDS TRUST.

7. The SPECIAL NEEDS TRUST is irrevocable. It was prepared after the enactment of Section 13611(b) of the Omnibus Budget Reconciliation Act of 1993 (42 U.S.C. §1396p), which codified Special Needs Trusts. Illinois adopted the Special Needs Trust with its amendment to the Illinois Compiled Statutes Chapter 760 § 5/15.1 (the Trusts and Trustees Act) on January 1, 1996 and Illinois Administrative Code Title 89 § 120.347 (Treatment of Trusts) on August 28, 1998.

8. Article IX of the SPECIAL NEEDS TRUST provides that upon JANE DOE’s death, the “Trustee shall pay to Illinois as reimbursement for medical assistance all amounts paid to the beneficiary, or for her benefit.” This type of provision in a trust is commonly referred to as a “payback provision” because a State is paid back for the medical assistance payments it has made on someone’s behalf. Furthermore, any trust residue after the payback to the State of Illinois is to be distributed by the SPECIAL NEEDS TRUST Trustee to JANE DOE’s heirs at law as defined by Illinois law.

9. Section 5/15.1 of the Trusts and Trustee’s Act, “Trust for a Disabled Beneficiary”, in pertinent part, states the following:

A discretionary trust for the benefit of an individual who has a disability that substantially impairs the individual's ability to provide for his or her own care or custody and constitutes a substantial handicap shall not be liable to pay or reimburse the State or any public agency for financial aid or services to the individual except to the extent the trust was created by the individual or trust property has been distributed directly to or is otherwise under the control of the individual, provided that such exception shall not apply to a trust created with the disabled individual's own property or property within his or her control if the trust complies with Medicaid reimbursement requirements of federal law.

10. All the funds in the SPECIAL NEEDS TRUST were SUSAN’s funds and none of the funds in the trust were JANE DOE’s funds.

11. Since the SPECIAL NEEDS TRUST was funded by a third party, it is not required to have a payback provision. If the trust were funded with JANE DOE’s assets, then it would be required to have a payback provision.

12. JANE DOE was receiving public benefits at the time her parents executed their estate planning documents in 2001. However, they were not aware of the different types of special needs trusts and the different requirements for each type of trust.

13. Attached to this Complaint as Exhibit B is an Affidavit from JOHN, as one of the Grantors of the SPECIAL NEEDS TRUST.

14. Attached to this Complaint as Exhibit C is an Affidavit from attorney James Smith, the attorney who prepared JOHN and SUSAN’s estate planning documents, including the SPECIAL NEEDS TRUST.

15. Attached to this Complaint as Exhibit D is an Affidavit from the JOHN and SUSAN’s financial planner Thomas Johnson.

16. Since the Trust is irrevocable, the Trustee seeks relief from this court to reform the trust to remove the payback provision as it is not required by law.

17. Attached to this Complaint as Exhibit E is a proposed court order with language amending the JANE DOE SPECIAL NEEDS TRUST. This Amendment amends and modifies Article IX, “Distribution At Beneficiary’s Death”, and removes the payback provision from the SPECIAL NEEDS TRUST.

18. That notice of this petition was sent to the State of Illinois, by and through Assistant General Counsel to the Illinois Department of Healthcare and Family Services, Welfare Litigation at the Office of the Illinois Attorney General, to the Social Security Administration, to the attention of Regional Counsel, Region 5, as well as to Jane Doe, John A. Doe, Jane Doe’s adult siblings, and any other relative or party legally entitled to receive notice.

WHEREFORE, Your Petitioner, MARY DOE, requests this Court enter an Order reforming the Jane Doe Special Needs Irrevocable Pay Back Trust in accordance with Exhibit E attached to this Complaint, and granting such other relief to the Petitioner as it may deem appropriate.

Respectfully Submitted,

___

MARY DOE, as Trustee of The Jane Doe

Doe Special Needs Irrevocable Pay Back

Trust dated August 5, 2001

STATE OF ILLINOIS )

) SS.

COUNTY OF COOK )

Under penalties as provided by law pursuant to Section 1-109 of the Code of Civil Procedure, the undersigned certify that the statements set forth in this instrument are true and correct except as to matters therein stated to be on information and belief, and as to such matters, the undersigned believe the same to be true.

___

MARY DOE, as Trustee of The Jane Doe

Doe Special Needs Irrevocable Pay Back

Trust dated August 5, 2001

In accordance with Supreme Court Rule 137, the Attorney for the Petitioner affixes his signature hereto.

The Elder Law Office of

Steven C. Perlis and Associates, P.C.

By:

STEVEN C. PERLIS, Attorney at Law

The Elder Law Office of

Steven C. Perlis and Associates, P.C.

Firm #24773

Attorneys for Petitioner/Trustee

3345 N. Arlington Heights Road, Suite D

Arlington Heights, IL 60004-1591

(847) 818-1138

(847) 818-1128 - Fax



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