Chicago Business Litigation Lawyer Blog

In a Chicago legal malpractice lawsuit, the First District Court of Appeal has ruled that the defendant is not barred from certain defenses because the plaintiff improperly joined the malpractice claim with its underlying action. Preferred Personnel Services, Inc. v. Meltzer, Purtill & Stelle, LLP, No. 1-08-0389 (Ill. 1st. Jan 23, 2009).

Preferred is a staffing company with a claim against insurance broker Arthur J. Gallagher & Co. Gallagher told Preferred that it had secured malpractice insurance for the company and accepted payment for those services, but Preferred later discovered that it had no insurance. Preferred hired Illinois law firm Meltzer, Purtill & Stelle to sue Gallagher, but the firm never started its case. More than two years later, Preferred and its new lawyers sued Gallagher for breach of contract, negligence and fraud. In the same suit, it also sued Meltzer and one of its attorneys, Thomas Palmer (collectively “Meltzer”), for malpractice.

Gallagher moved to dismiss because the statute of limitations had passed in 2001, a motion that was granted by the trial court and upheld by the appellate court. While that motion was pending, Meltzer moved to dismiss the claims against it, saying the malpractice claims were premature because the underlying claim was still viable until the appeals court had ruled. This motion was denied. After the appellate decision on the Gallagher dismissal, Preferred moved for partial summary judgment, asking the court to foreclose arguments by Meltzer that the statute had not run on the Gallagher claims. The trial court granted this motion, but also certified three questions for the First District Court of Appeal to answer:

1. ”Did the Legal Malpractice Defendants in this action have standing to oppose the Company’s [Gallagher’s] Motion to Dismiss where the Legal Malpractice Defendants’ motion based on prematurity was pending?


2. Are the Legal Malpractice Defendants in this action collaterally estopped from
   raising an issue that was decided in favor of the defendant Company where the Legal
   Malpractice Defendants’ motion based on prematurity was pending and notwithstanding
   facts which might have changed the outcome?


3. Did the ruling on the statute of limitations when it was decided in favor of a
   separate defendant become the ‘law of the case’ as it relates to the claims against the
   Legal Malpractice Defendants and notwithstanding facts which might have changed the
   outcome?”

The court started its analysis by noting that it would not address Meltzer’s request to reverse the summary judgment ruling against it. It then explained that this case presents an unusual situation: A legal malpractice claim joined with the claim that underlies it. Preferred raised multiple arguments for this approach, all of which the appeals court rejected. Preferred’s true reason for joining them, the court noted, was explicitly stated in the Gallagher appeal: “To foreclose Meltzer-Palmer from arguing that Preferred prematurely abandoned a viable claim against Gallagher.”

However, the court did not accept Meltzer’s argument that it lacks standing to be joine in the argument. Instead, the court said, the issue is prematurity, citing Weber v. St. Paul Fire & Marine Insurance Co., 251 Ill. App. 3d (1993). To win a legal malpractice claim, plaintiffs must show they have been damaged -- which would include a dismissal of the case, the court said. Because there was no dismissal at the time Preferred filed its legal malpractice claim, the claim was not ripe. Thus, the court answered its first question in the negative: Meltzer had no standing to oppose Gallagher’s motion to dismiss, though it felt that ripeness was the real problem.

For similar reasons, it also answered the second question in the negative: Meltzer was not collaterally estopped from relitigating the statute of limitations in the Gallagher claim. Preferred argued that Meltzer should be estopped because it had failed to weigh in on Gallagher’s motion to dismiss or Preferred’s own appeal. The court had several reasons for finding this untrue: The firm had not previously litigated the question; Illinois courts generally do not favor offensive use of collateral estoppel; and most importantly, the doctrine cannot be used in Illinois unless it results in no unfairness to the defendant. Kessinger v. Grefco, Inc., 173 Ill. 2d (1996).

Finally, the court addressed the “law of the case” doctrine, which prohibits courts from relitigating issues that had already been decided in a related case. This doctrine is not binding on a trial court that’s considering different issues, different parties or different facts, the First noted. In this case, Meltzer was not a party to the Gallagher appeal, and the issue of alternative legal theories against Gallagher was not exhausted anyway, the judges wrote. Thus, it answered the third question in the negative as well and remanded the matter to the trial court.

DiTommaso-Lubin is a business trial and litigation law firm based in Chicago and Oak Brook, Illinois. Our Illinois legal malpractice attorneys help wronged clients seeking to hold their former lawyers responsible for costly mistakes. We also handle Illinois legal malpractice litigation for attorney clients seeking to defend themselves from a malpractice claim. If you’re in this position and you would like to learn more, please contact our firm online for a confidential consultation.

A legal malpractice plaintiff who is also the executor of an estate may issue new creditor notices to avoid having his case dismissed, the First District Court of Appeal decided March 31. In Jaason v. Sullivan, No. 1-08-1254 (Ill. 1st Dist. March 31, 2009), the executor, Erik Jaason, filed a Chicago legal malpractice lawsuit against Barbara J. Sullivan and B.J. Sullivan & Associates for alleged mistakes in a will Sullivan prepared for Alexander Koepp.

In his complaint, Jaason alleges that Koepp instructed Sullivan to prepare a will giving Jaason the right to purchase Koepp’s home for $150,000, at Jaason’s discretion. However, Koepp’s home was already held in joint tenancy with his wife, Karsti Koepp. Thus, upon Alexander Koepp’s death in November of 2006, the property was outside the purview of the will and passed to Karsti Koepp under the joint tenancy, leaving Jaason with no option to purchase it. He sued Sullivan in December of 2007 for legal malpractice, alleging that her failure to recognize and take action on the joint tenancy fell outside the applicable standard of care.

In response, Sullivan filed a motion to dismiss the suit as time-barred. The Illinois Code of Civil Procedure requires that, in cases where probate has been opened, plaintiffs must file their claims for legal malpractice within the time given for claims against the estate or the time given for contesting the validity of a will -- whichever is greater. The six-month window for contesting the will had clearly elapsed in the 13 months since Koepp’s death. To make a claim against an estate, creditors in Illinois have three months from the date they receive a notice of the death in the mail, or six months from the date of publication of the death as a legal notice, whichever is later.

As the independent executor of Koepp’s will, Jaason had already published notice of the death giving a deadline of December 1, 2007 -- just before the legal malpractice lawsuit was filed. On February 7, 2008, the same day of Sullivan’s motion to dismiss, he placed new creditor notices giving a deadline of May 9, 2008. Jaason argued that these new notices made his legal malpractice lawsuit timely. Sullivan argued that the Probate Act does not allow different deadlines for different creditors, requiring one notice and one deadline for all potential creditors. Thus, she argued, the court must dismiss Jaason’s claim as untimely.

The First District disagreed. Construing the plain language of the Probate Act, it found that the “whichever is later” provision clearly allows different deadlines for different creditors. Because the most recent notice to creditors went out in February of 2008, two months after the legal malpractice suit was commenced, the court found that Jaason’s claim was timely. It added that it is not unaware of the self-interest involved in Jaason’s actions, as both the personal representative of Koepp’s estate and the plaintiff in this claim. However, the judges wrote, there is no evidence to show that the notices were fraudulent. Thus, the dismissal of Jaason’s suit was reversed and remanded to trial court.

The Illinois, Wheaton, Waukegan, Wilmette and Chicago civil litigation lawyers and probate and business trial attorneys at DiTommaso-Lubin handle malpractice claims and contested probate estate lawsuits. Based in Oakbrook Terrace, near Oak Brook, Wheaton, and Chicago, DiTommaso-Lubin represents clients in state and federal courts throughout Illinois and the Midwest. Our Illinois legal malpractice attorneys represent clients aggressively in malpractice claims and fee disputes, working hard to ensure that justice is served. If you are involved in a legal malpractice lawsuit and you’re looking for experienced representation, DiTommaso-Lubin can help. To learn more at a free consultation, please contact us online or call 1-877-990-4990 today.

Our Illinois legal malpractice lawyers recently noted an appellate decision from the Second District establishing that attorney fees are "actual damages" within the meaning of Illinois law. Nettleton v. Stogsdill, No. 2-07-1215 (Ill. 2nd Dec. 29, 2008). The ruling arose out of a legal malpractice claim by Margaret Nettleton, who was unhappy with the representation provided by attorney William J. Stogsdill, Jr., in her divorce.

Nettleton retained Stogsdill in 2001 for her divorce, whose trial was set for late 2002. On the day before trial, however, an associate from Stogsdill's office appeared to ask for a continuance because Stogsdill was in another trial and unable to attend or prepare. The motion was denied, but a two-day continuance was granted the next day when Stogsdill himself appeared. On the day of the new trial, Stogsdill asked for a voluntary nonsuit, which was denied because he hadn't given notice to all of the parties. He then called Nettleson to the stand, where he asked her to state and spell her name. He then rested her case. The divorce was not granted. Stogsdill filed a second petition for dissolution, but Nettleton fired him about two months later. (She was represented by four other firms before her divorce was granted.)

Nettleton eventually sued, alleging that Stogsdill and his firm committed malpractice by being unprepared, by moving for a nonsuit without her consent and by putting her on the witness stand and then resting without her consent. The damages she cited included loss of the attorney fees paid to both Stogsdill and other attorneys. The trial court granted Stogsdill's motion for summary judgment on the grounds that Nettleton hadn't demonstrated actual damages caused by Stogsdill's actions -- she hadn't shown that she would have received a larger divorce settlement if not for Stogsdill. After various other legal maneuvers, Nettleton appealed.

Nettleton's appeal contended that the trial court misapplied the law on actual damages because the attorney fees were the direct result of Stogsdill's alleged negligence, and no caselaw disallows such a finding. The appeals judges agreed. Relying on Sorenson v. Fio Rito, 90 Ill. App. 3d 368, 374 (1980) and Sterling Radio Stations, Inc. v. Weinstine, 328 Ill. App. 3d 58, 63 (2002), they wrote that Nettleton incurred new attorney fees in an attempt to undo the effects of alleged negligence -- to get the divorce that she was not granted originally. Relating the malpractice damages to the size of the divorce settlement Nettleton received was "illogical," the court wrote, because it was not at issue in the malpractice claim.

The appeals court also examined Nettleton's claim that the trial judge erred in granting summary judgment on the issue of whether Stogsdill proximately caused her damages. Nettleton claimed this was a genuine issue of material fact inappropriate for summary judgment, and the appeals judges agreed. Deposition testimony showed that at least some of the divorce would have to be litigated again because of Stogsdill's actions, and thus a reasonable person could conclude that Stogsdill caused at least some of the new attorney fees. Caselaw cited by the defendants was, again, irrelevant. Thus, the appeals court reversed the summary judgment decision and remanded it to trial court.

As legal malpractice attorneys in Chicago, DiTommaso-Lubin has substantial experience sorting out the fine distinctions that make the difference between success and failure of a malpractice case. We represent both clients and attorneys involved in Illinois malpractice claims. Located in Chicago and with offices in Oak Brook near Naperville, Wheaton and Aurora, we serve clients in the greater Chicago area and throughout the Midwest. To speak to us today about your malpractice case, please contact us through our Web site for a confidential consultation.

The Illinois Appellate Court for the 1st District ruled May 7 that a legal malpractice class action against the law firm DLA Piper Rudnick Gray Cary could not go on because it was filed well after a tolling agreement ended. In Joyce v. DLA Piper Rudnick Gray Cary LLP, 1-07-1966 (Ill.App. May 7, 2008), the court upheld the dismissal of a purported class action by stockholders of 21st Century Telecom Group, a Chicago telephone company, pursuant to a tolling agreement between 21st Century and DLA Piper.

The underlying dispute started in 1999, when 21st Century agreed to merge with competitor RCN. DLA Piper attorneys drafted a merger agreement with a mistake that lowered the price of the stock 21st Century shareholders were to receive by $19 million. In response, Edward Joyce, the stockholders’ representative, made a tolling agreement with DLA Piper, in which the statute of limitations was tolled unless a stockholder lawsuit was filed against the firm on or before December 31, 2002. The firm agreed not to avail itself of any statute of limitations defense until after that day. This agreement was amended four times, each time altering only the date. The last agreement set that date at August 21, 2005.

Joyce filed a legal malpractice class action in Cook County against DLA Piper on August 30, 2006. After some procedural disputes, including a finding by the trial court that the filing was timely, the firm won a motion to dismiss based on plaintiff’s lack of standing as a non-client. The plaintiffs appealed and the defendant cross-appealed on the trial court’s decision that the suit was timely.

The appeals court upheld that cross-appeal, finding that the plaintiffs were barred because they filed nearly a year after the last agreement expired. The court rejected the defendants’ contention that it was timely because each amended tolling agreement constituted a new contract that extended the statute of limitations.

Writing for the three-judge majority, Justice Grieman found the tolling agreement unambiguous in setting an end date of August 31, 2005. “Indeed, to accept plaintiff’s argument would require this court to allow plaintiff the benefits of the first four amendments without fulfilling the requirement of filing suit by the specified dates imposed by any of the amendments.”

The majority declined to take up the issue of whether the 21st Century shareholders could be considered clients of DLA Piper.