Butler v. Mayer, Brown and Platt

Citations: 704 N.E.2d 740; 301 Ill. App. 3d 919; 235 Ill. Dec. 167; 1998 Ill. App. LEXIS 805Docket: 1-97-4639

Court: Appellate Court of Illinois; November 25, 1998; Illinois; State Appellate Court

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Plaintiff Frank O. Butler II appeals the dismissal of his legal malpractice suit against defendant Mayer, Brown and Platt, which was dismissed by the trial court based on the two-year statute of limitations for attorney claims. The court's ruling was based on 735 ILCS 5/13-214.3(b), which bars such claims after the specified period. On appeal, Butler argues that the statute of limitations should not have commenced until the appellate court upheld the judgment against him, and even if it began when the trial court ruled, the defendant should be estopped from invoking it due to assurances given post-judgment.

The verified amended complaint details that in July 1986, Butler and his siblings agreed on how to divide shares inherited from six corporations, including a "put" procedure allowing shareholders to compel buyouts. After Butler exercised this option in April 1989, his siblings failed to purchase his interest, leading him to sue them with the assistance of Mayer, Brown and Platt. His initial complaint sought specific performance under the shareholder agreement without including a breach of contract claim for damages. The trial court initially granted summary judgment for Butler on the specific performance but required a trial to assess the joint liability of his siblings and the fair market value of his shares.

At trial, it was alleged that the firm relied on expert testimony outside their expertise. Ultimately, on January 15, 1993, the trial judge denied Butler’s request for specific performance, stating he failed to meet the "clear and convincing" evidence standard required for such cases, suggesting a breach of contract claim might have been more suitable. Butler sought to amend his complaint to include this claim, which the court initially granted, but later expressed concern over the inefficiency of allowing this amendment after a lengthy trial on the specific performance issue. The case has been remanded for further proceedings to clarify when the statute of limitations began to run.

The trial court vacated a prior order from February 19, 1993, and denied the plaintiff's request to amend his complaint. Subsequently, the court awarded attorney fees to the plaintiff's sister and issued a final judgment on February 1, 1994. This judgment was appealed and affirmed on September 13, 1995, in Butler v. Kent. The plaintiff claims to have first learned of a January 15, 1993, order through the media, prior to receiving a facsimile from his law firm, which did not inform him of the judge's oral comments or provide a transcript. Following the court's denial of specific performance, attorneys from the firm communicated with the plaintiff, expressing confidence that the court had erred and that he would prevail on appeal. The plaintiff communicated with his attorney multiple times between the date of the order and the appellate decision, during which he received reassurances about the likelihood of success. The plaintiff alleges that the firm claimed it could dissuade other attorneys from representing him due to its negative portrayal of him.

On March 7, 1997, the plaintiff filed a complaint against the defendant for legal malpractice, breach of contract, and breach of fiduciary duties, over three years after the final trial court judgment. The law firm moved to dismiss the complaint, citing the two-year statute of limitations for attorney claims, arguing that the plaintiff should have recognized his injury at the time of the final judgment. The trial court granted this motion, determining the firm was not estopped from invoking the statute of limitations because the reassurances given were opinions, not false statements of fact. The court emphasized that, in a section 2-619 dismissal, all well-pleaded facts and reasonable inferences must be accepted as true. A legal malpractice action must be initiated within two years from when the plaintiff knew or should have known of the injury, as established in prior case law, which recognizes the discovery rule for triggering the statute of limitations.

When determining when a plaintiff should have discovered their injury, it is generally a factual question, and a judgment as a matter of law is appropriate only when undisputed facts lead to a single conclusion. The trial court found that the plaintiff was aware, or should have been aware, of his injury by February 1, 1994, arguing that he only faced a potential for damages that could be reversed. This argument was previously rejected in Belden v. Emmerman and Zupan v. Berman, which established that a plaintiff is considered injured at the time an adverse judgment is entered, regardless of the uncertainty of damages or potential for reversal. The plaintiff's incurred attorney fees and subsequent legal representation in anticipation of litigation further support this conclusion.

The inquiry also involves whether the plaintiff knew his injury was wrongfully caused. The plaintiff contended that he could not have understood the wrongful nature of the trial court's adverse ruling until the appellate court contradicted his law firm's assurances. However, it was noted that a layperson may not immediately recognize malpractice, but they are still charged with knowledge of facts that suggest wrongful conduct. The discovery rule allows for a delay in the commencement of legal action until a plaintiff reasonably believes their injury stems from wrongful conduct, at which point they are obligated to investigate further. Ultimately, the sufficient information regarding the injury and its cause typically constitutes a factual question. While prior cases indicated that an adverse judgment signals when a plaintiff should be aware of their injury and its wrongful cause, it does not imply that such a judgment alone confirms legal malpractice has occurred.

In Belden, the client suspected negligence due to the defendant firm's acknowledgment of a conflict of interest and subsequent withdrawal as counsel while still providing advice. In Zupan, the client was aware of wrongful injury at the time of judgment. The trial court's denial of the plaintiff's motion to amend his complaint was discretionary and does not indicate legal malpractice. The court had suggested that the late amendment was detrimental to the plaintiff's case, but the plaintiff claims he was unaware of this due to the firm's failure to inform him. The plaintiff alleges negligence not only for the failure to amend but also for employing an unqualified expert witness for damage assessment. The firm contends that the plaintiff should have recognized his injury when he sought new legal counsel in 1993. An affidavit from one of the firm's attorneys indicates that new attorneys were hired to assist with matters arising post-January 15, 1993, without confirming whether they reviewed the firm's prior work. There are multiple instances where a fact finder could determine that the plaintiff should have been aware of his injury, but the circumstances are not conclusive. Thus, the case is remanded for further proceedings. The plaintiff also argues that the firm should be estopped from invoking the statute of limitations. If a jury finds the statute did not begin until after an appellate court affirmance, the plaintiff's suit is timely. However, if the statute began more than two years prior to filing, the estoppel argument becomes significant.

The plaintiff claims that the defendant law firm caused a delay in filing a malpractice suit by concealing important trial court comments, providing reassurances regarding the success of an appeal, and threatening interference with the plaintiff's attempts to obtain new counsel. The court references the Jackson Jordan case, which indicates that a lawyer's continuous reassurances may toll the statute of limitations. However, equitable estoppel is not applicable here because the plaintiff did not file suit within a reasonable time after the defendant ceased providing reassurances. Under Illinois law, equitable estoppel does not extend the entire limitations period from the point when the defendant stops the conduct that led to the plaintiff's inaction. Importantly, the court notes that "ample time" exists for a plaintiff to act if a reasonable period remains in the statute of limitations, citing previous cases where six months was considered sufficient. The court highlights that the plaintiff's delay of 18 months, after the conduct that caused the delay ended on September 15, 1995, was not reasonable, especially since nearly five months remained under the statute of limitations following the relevant judgment. The decision is reversed and remanded, with judges McNulty and Leavitt concurring.