Smith v. Vanguard Group Inc.Annotate this Case
Donald initially listed no beneficiary who would take any funds remaining in his individual retirement account at his death. In 2013, he was hospitalized. During his hospitalization, someone designated his wife, JoAnn, as beneficiary. When Donald was released from the hospital, he sought a temporary restraining order and injunction. The spouses stipulated to an injunction ordering that neither party engage in any transaction regarding the parties’ financial accounts. That injunction action was later combined with a dissolution action. While still bound by the injunction, Donald changed the beneficiary designation to his sons. After the combined actions were dismissed, Donald died. JoAnn filed suit, alleging that the beneficiary change violated the injunction so that the change was void. The appellate court and Illinois Supreme Court affirmed dismissal of the suit. The injunction did not mention changes of beneficiaries; the change of beneficiary did not vest during the pendency of the injunction or the combined underlying actions. The change of ownership did not occur until after the injunction was dismissed. The circuit court could have distributed whatever amount of the IRA that it found equitable had the dissolution action proceeded to a final judgment. An individual does not, however, have the same interest in her spouse’s property at probate that she does at dissolution.