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Illinois Appellate Court looks beyond label to apply shorter statute of limitations

10/8/25

By: Jason S. Callicoat

The Illinois Appellate Court recently held that a breach of fiduciary duty claim, brought by one sibling against another, was in effect a claim against their father’s estate and therefore time-barred.

In Smith v. Connor, 2025 IL App (2d) 240536, Gregory Smith sued his sister Margaret Connor, alleging she had breached her fiduciary duty to him while serving as executor of their father’s estate. Their father had had four children. Three were still surviving at the time of his death. A fourth predeceased him but had two surviving children, who were the father’s grandchildren. The will called for the father’s estate to be divided into four equal portions. Three portions were to go to his three surviving sons and daughters, with the fourth to be divided equally between the two grandchildren.

Connor was the beneficiary of two life insurance policies her father had obtained, and she was listed as a co-owner on certain of his bank accounts, which passed to her upon his death. However, she collected the life insurance proceeds and all of the account funds, and she offered to divide them according to the formula specified in her father’s will. In connection with her role as executor, she incurred legal fees of just over $5,000. She proposed to have those fees paid from the estate, leaving approximately $173,000 to be divided among the heirs.

Smith opposed this proposal and refused to sign a settlement agreement that would have implemented this distribution. Instead, he filed a lawsuit against his sister, alleging breach of fiduciary duty and seeking a declaratory judgment and an accounting of the estate. One of Smith’s main arguments was that it was unnecessary for his sister to have incurred just over $5,000 in legal fees in the course of fulfilling her duties as executor.

Smith and Connor’s father had died on July 25, 2021, and Smith filed suit on February 2, 2024. The statute of limitations for breach of fiduciary duty in Illinois is five years. However, the Illinois Probate Act of 1975 provides that the statute of limitations for claims against an estate is two years. The trial court found the breach of fiduciary duty claim was subject to the two-year statute of limitations in the Probate Act because it was related to the administration of the estate and claims against the estate. The trial court, therefore, dismissed Smith’s lawsuit based on the two-year statute of limitations. Smith appealed, and the Appellate Court affirmed.

The Probate Act classifies claims against the estate as including claims related to the surviving spouse’s or child’s award. The Appellate Court noted that Smith’s amended complaint identified him as the decedent’s son with an interest in the proper administration and distribution of his will and estate assets. Smith further alleged that Connor had misappropriated estate assets, and Smith sought a distribution of estate assets to himself and the other heirs due to Connor’s alleged misappropriation. The Appellate Court agreed that Smith’s allegations identified him as a surviving child seeking an award through his claims against Connor in her capacity as the executor of the estate. The Probate Act bars all claims against the estate unless those claims are brought within two years after the decedent’s death. This includes claims based on tort, contract or any other legal theory.

This case highlights that courts will look beyond the labels that litigants assign to their causes of action when evaluating the applicable statute of limitations. To determine which statute of limitations applies, courts will examine the nature of the relief sought and the source of recovery for any relief that might be granted. Although the plaintiff in this case characterized his claim as one for breach of fiduciary duty, the alleged breach related to the distribution of estate assets. Further, if the plaintiff had been successful, his recovery would have been in the form of having the estate assets distributed differently. As a result, this was a claim against the estate that was subject to the shorter statute of limitations.

For any questions or further clarification, please contact Jason S. Callicoat at jason.callicoat@fmglaw.com or your local FMG attorney.

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