Breach of Contract

Dismissal of Duplicative Matters: Breaches of Contract and Fee Petitions

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Clarice G. Schmidt (“Schmidt”) filed a breach-of-contract claim against attorneys Audrey L. Gaynor and Richard D. Felice and the law firm Audrey L. Gaynor & Associates, P.C. (the “Defendants”).  She accused them of overbilling for their services during her ongoing divorce.  The Defendants moved to dismiss the breach-of-contract claim as duplicative under 735 ILCS 5/2-619(a)(3), since they had already filed fee petitions in Schmidt’s divorce case in order to address the legitimacy of their bills.  The trial court granted the motion and Schmidt appealed.

The Second District affirmed. Dismissal of a redundant matter under section 2-619(a)(3) requires two issues pending “between the same parties for the same cause.”  Id. at ¶9. The parties here were plainly identical. As for the causes of action, they are considered the same if they arise “out of the same transaction or occurrence” such that there is a “substantial similarity.”  Id.  The court noted that substantial similarity did not require “the legal theory, issues, burden of proof or relief sought” to be materially identical.

Here, the only allegations set forth in Schmidt’s breach-of-contract complaint were that the Defendants breached their attorney-client agreements by charging excessive fees. The Second District therefore concluded that the matters were the same, surmising that Schmidt “merely seeks to have a separate court perform another analysis as to the reasonableness and necessity of those same fees.”  Id. ¶12.  Schmidt asserted that her breach-of-contract claim was actually a legal-malpractice claim, but this argument was rejected.  “We are at a loss,” the court declared, “as to how plaintiff’s breach-of-contract suit transformed into one for legal malpractice, when she did not allege any of the elements of legal malpractice.”  Id. at ¶14.  Moreover, Schmidt tacitly acknowledged that she could obtain disgorgement in the divorce/fee-petition litigation because she included her breach-of-contract complaint as an affirmative matter therein.

Schmidt v. Gaynor, 2019 IL App (2d) 180426

(This is for informational purposes and is not legal advice.)

Soverain Software, LLC v. Day, 2017 IL App (1st) 161913-U, appeal denied sub nom. Soverain Software, LLC v. Jones Day, 98 N.E.3d 58 (Ill. 2018)

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This unpublished opinion related to a suit between a former client and a law firm principally centered on past due fees.  The law firm brought a breach of contract claim for $10 million for past due fees and the client counterclaimed for a number of things, including breach of contract and legal malpractice.  The parties arbitrated the dispute and the arbitrator found in favor of the law firm for $1.5 million.  The trial court vacated the arbitration awarded finding that the arbitration panel exceeded its authority and created a compromise award.  The appellate court reversed and affirmed the arbitral award, finding that the award was grounded in the parties’ contract and the trial court improperly imposed its view in place of the arbitral award.

Soverain Software, LLC v. Day, 2017 IL App (1st) 161913-U

(This is for informational purposes and is not legal advice.)

Hill v. Simmons

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In this unpublished opinion, the First District held that a complaint against a lawyer was properly dismissed as time-barred.   The court held that the plaintiff’s claims for fraud, aiding and abetting fraud, breach of fiduciary duty and conspiracy were properly subject to the two year attorney statute of limitations, and that the statute began to run when the plaintiff learned of the lawyer’s alleged misrepresentations.

Hill v. Simmons, 2017 IL App (1st) 160577-U

(This is for informational purposes and is not legal advice.)

Recent Illinois Case: First American Title Insurance Co. v. Dundee Reger LLC v. Hallam

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The Northern District of Illinois addressed third-party claims against a law firm asserting legal malpractice and, in the alternative, breach of contract and promissory estoppel.  The third-party defendant moved to dismiss the breach of contract and promissory estoppel claims as duplicative of the legal malpractice claim.  The court held that, under Illinois law, duplicative breach of fiduciary duty claims should be dismissed but breach of contract claims, even if duplicative, may be plead in the alternative.  The motion to dismiss was denied.

(This is for informational purposes and is not legal advice.)

First American Title Insurance Co. v. Dundee Reger, LLC et al. v. Peter G. Hallam, 2016 WL 1359374

Recent Illinois Case: Navar v. Tribler, Orpett and Meyer, P.C.

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In this unpublished opinion, the Appellate Court affirmed the dismissal of three claims against lawyers. A breach of contract claim was properly dismissed because the plaintiff failed to identify a specific contract term that was breached. The malpractice claim was properly dismissed because the complained of acts involved judgment and not malpractice. The fraud claim was properly dismissed because predictions of future events do not constitute fraud. The Appellate Court also affirmed the trial court’s refusal to allow a further amendment.

Navar v. Tribler, Orpett and Meyer, P.C., 2015 IL App (1st) 142641-U

(This is for informational purposes and is not legal advice.)

Recent Illinois Case: Banks v. Casson

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This recent case involved a dispute between attorneys over failure to pay a lawyer referral fee.  The attorneys never obtained signed written consent from the client for the referral fee, as required by Rule 1.5 of the Illinois Rules of Professional Conduct. Nonetheless, the attorney who was allegedly owed the fees filed a lawsuit, seeking damages for breach of fiduciary duty (under a joint venture theory) and fraud.  The First District affirmed dismissal, holding that the breach of fiduciary duty claim failed because the “joint venture” was based on an unenforceable agreement.   The fraud claim was time barred.

Banks v. Casson, 2015 IL App (1st) 133141-U

(This is for informational purposes and is not legal advice.)

Harvery v. Connor, 85 Ill. App. 3d 1061, 407 N.E.2d 879 (1st Dist. 1980)

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Harvery v. Connor, 85 Ill. App. 3d 1061, 407 N.E.2d 879 (1st Dist. 1980) (attorney not liable for client’s breach of contract signed by attorney as agent)