Carlson v. Cronin , 2022 IL App (1st) 200724-U ( 2022 )

2022 IL App (1st) 200724-UNo. 1-20-0724
Order filed June 30, 2022
Fourth Division
NOTICE: This order was filed under Supreme Court Rule 23 and is not precedent except in the
limited circumstances allowed under Rule 23(e)(1).
IN THE
APPELLATE COURT OF ILLINOIS
FIRST JUDICIAL DISTRICT
WILLIAM CARLSON and WILLIS CAPITAL, LLC, ) Appeal from the
) Circuit Court of
Plaintiffs-Appellants, ) Cook County.
)
v. ) 16 L 383
)
THOMAS CRONIN, AARON L. DAVIS, LELAND W. )
HUTCHINSON, JR., DANIEL J. KELLEY, and )
CRONIN & COMPANY LTD, ) Honorable
) Daniel J. Kubasiak,
Defendants-Appellees. ) Judge Presiding.
JUSTICE MARTIN delivered the judgment of the court.
Presiding Justice Reyes and Justice Rochford concurred in the judgment.
ORDER
¶1 Held: We affirm the circuit court’s grant of summary judgment in favor of the Cronin
defendants on count II of the amended complaint for legal malpractice brought by
William Carlson.
¶2 William Carlson (Carlson) entered into a settlement agreement with his former business
partners Thomas Hutchinson (Hutchinson) and Owen O’Neill (O’Neill). Under the terms of the
agreement, Carlson agreed to sell them his ownership interest in Belvedere Trading LLC. Later,
No. 1-20-0724
Carlson sought to reopen and set aside the agreement, arguing that it was procured by fraud and
malfeasance on the part of his former business partners. Having been unsuccessful in his efforts to
have the agreement set aside, Carlson filed a series of legal malpractice claims against various law
firms and lawyers who advised him in connection with the agreement. See Willis Capital LLC v.
Belvedere Trading LLC, 2015 IL App (1st) 132183; Carlson v. Fish, 2015 IL App (1st) 140526(Carlson I); and Carlson v. Michael Best & Friedrich LLP, 2021 IL App (1st) 191961 (Carlson
II). This is the latest appeal in that series.1
¶3 I. BACKGROUND
¶4 In 2002, Carlson founded Belvedere Trading LLC (Belvedere) for the purpose of trading
S&P 500 equity index options. Carlson owned his interest in Belvedere through another limited
liability company, Willis Capital LLC, of which he was the sole owner and member. Hutchinson
and O’Neill eventually joined Belvedere as partners. Willis Capital LLC, 2015 IL App (1st)
132183, ¶ 5. “Carlson was the sole managing member and held about a 62% membership interest;
O’Neill held about a 25% interest and Hutchinson held the remaining 13% interest.” Carlson I,
2015 IL App (1st) 140526, ¶ 6. However, by 2004, O’Neill and Hutchinson were managing
members and owned an equal 33.3% interest along with Carlson. Id.¶5 In 2005, Carlson took a leave of absence from actively managing Belvedere due to health
reasons. When Carlson returned to the company in 2006, “he had a falling out with O’Neill and
Hutchinson over numerous issues, including profit distribution and management.” Id. ¶ 7.
¶6 In March 2007, Carlson retained Attorneys Shawn M. Collins and David J. Fish of the
Collins Law Firm, P.C. to represent him in his dispute with O’Neill and Hutchinson; Fish later
formed the Fish Law Firm while continuing to represent Carlson; the two law firms are collectively
In adherence with the requirements of Illinois Supreme Court Rule 352(a) (eff. July 1, 2018), this
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appeal has been resolved without oral argument upon entry of a separate written order.
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referred to as “Collins.” Id.¶7 In May 2007, Collins filed a request for arbitration on behalf of Carlson with the Chicago
Board Options Exchange (CBOE), as provided for in Belvedere’s operating agreement. Carlson
II, 2021 IL App (1st) 191961, ¶ 6. In addition, Collins filed a complaint for injunctive relief in the
circuit court seeking to dissolve Belvedere and compel a purchase of Carlson’s interest in the
company for fair value. Id. Hutchinson and O’Neill refused Carlson’s request to obtain an appraisal
of Belvedere and also denied his request for access to the company’s books and records.
¶8 In February 2008, the parties agreed to mediate their dispute. Carlson failed to obtain an
independent appraisal of his interest in Belvedere prior to the mediation, but in an e-mail to Collins,
he estimated that by the end of 2009, the company could be sold for $100 million. Id. ¶ 7; Carlson
I, 2015 IL App (1st) 140526, ¶ 8.
¶9 Unbeknownst to Carlson, and prior to the mediation, O’Neill and Hutchinson employed an
accounting firm to conduct an appraisal of Belvedere to determine a market value of Carlson’s
one-third interest in the company. Carlson II, 2021 IL App (1st) 191961, ¶ 7; Willis Capital LLC,
2015 IL App (1st) 132183, ¶ 8. The accounting firm developed statistical models to estimate this
value and presented the models to O’Neill and Hutchinson. After receiving the statistical models,
O’Neill and Hutchinson directed the accounting firm not to prepare a written report of its findings
and to stop further work on the appraisal. None of this was disclosed to Carlson.
¶ 10 At the mediation, Carlson again asked for an appraisal of Belvedere. In response,
Hutchinson and O’Neill claimed that an appraisal was unnecessary as they were not interested in
selling their interests in Belvedere. Carlson II, 2021 IL App (1st) 191961, ¶ 8; Willis Capital LLC,
2015 IL App (1st) 132183, ¶ 9. The mediation resulted in Carlson agreeing to sell his interest in
Belvedere for $17.5 million. The three owners signed a document delineating the terms of the sale,
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which were subsequently memorialized in a settlement agreement signed by them in March 2008.
Carlson II, 2021 IL App (1st) 191961, ¶ 9; Carlson I, 2015 IL App (1st) 140526, ¶ 8.
¶ 11 The settlement agreement provided in part that it represented:
“a complete compromise of the controversy between the parties involving disputed issues
of law and fact, and that each party fully assumes the risk that the facts or law may be other
than they believe”; the parties agree “that they are not fiduciaries to each other with respect
to the negotiations, preparation and execution of” the agreement; and the parties were
advised by their respective attorneys and advisors as to the merits of the agreement and
that no party was relying on any promise, representation or disclosure of any other party.
¶ 12 In addition, the agreement contained a fee-shifting provision providing that attorney fees
and expenses could be awarded to a prevailing party in “an action brought by any party to enforce
the terms” of the agreement.
¶ 13 In September 2008, approximately six months after the mediated settlement, Carlson
exchanged e-mails with Shawn Collins expressing his belief that O’Neill and Hutchinson had
fraudulently tricked him into selling his interest in Belvedere for less than its true value. Carlson
II, 2021 IL App (1st) 191961, ¶ 11; Carlson I, 2015 IL App (1st) 140526, ¶ 9. Carlson and Shawn
Collins discussed the possibilities of petitioning the circuit court to reopen and set aside the
settlement agreement, and of filing a fraud action against O’Neill and Hutchinson.
¶ 14 In November 2008, Carlson contacted a college friend Chris Parker, who was an attorney
with the law firm of Michael Best & Friedrich, LLP (Michael Best). Carlson asked Parker to review
the settlement agreement and evaluate whether he had any viable claims against his former
business partners. Carlson II, 2021 IL App (1st) 191961, ¶ 12. Carlson also began expressing
dissatisfaction with the legal representation he received from Collins.
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¶ 15 On November 19, 2008, Carlson met with attorneys from the law firm of Drinker, Biddle
& Reath, LLP (Drinker), to review the settlement agreement and discuss possible fraud claims
against his former business partners. Id. ¶ 13; Carlson I, 2015 IL App (1st) 140526, ¶ 16. Carlson
claimed that during these discussions, questions were raised concerning whether the legal services
he received from Collins had been substandard. Carlson maintained that this was the first time he
became aware of a possible legal malpractice claim against Collins.
¶ 16 From August 18, 2010, through September 16, 2010, Carlson officially retained the law
firm of Michael Best for consultation regarding a potential legal malpractice action against Collins.
Parker advised Carlson that a legal malpractice action against Collins “may be tough in the face of
the statute of limitations.” Carlson II, 2021 IL App (1st) 191961, ¶ 14. Parker informed Carlson
that the applicable statute of limitations for a legal malpractice claim was two years from the date
Carlson should have learned of the alleged malpractice. Id.¶ 17 On November 11, 2010, Carlson retained the law firm of Cronin & Co., Ltd (Cronin). In
the course of their research, Carlson and counsel from Cronin contacted the accounting firm which
had conducted the pre-mediation appraisal of Belvedere. They discovered that unbeknownst to
Carlson, O’Neill and Hutchinson had employed the accounting firm to conduct a pre-mediation
appraisal of Belvedere to determine a market value of Carlson’s interest in the company. Id. ¶ 15;
Willis Capital LLC, 2015 IL App (1st) 132183, ¶ 12.
¶ 18 Cronin filed a legal malpractice complaint on behalf of Carlson against Collins on
November 18, 2010. Carlson II, 2021 IL App (1st) 191961, ¶ 16; Carlson I, 2015 IL App (1st)
140526, ¶ 17; Willis Capital LLC, 2015 IL App (1st) 132183, ¶ 12. In the complaint, Carlson
alleged that Collins failed to obtain an appraisal of Belvedere and “thereby permitted their clients
to settle without any appropriate advice and counsel as to what was being surrendered.” Willis
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Capital LLC, 2015 IL App (1st) 132183, ¶ 12. Cronin subsequently filed an amended legal
malpractice complaint against Collins on February 23, 2011. Carlson II, 2021 IL App (1st)
191961, ¶ 16. In March 2011, Collins moved to dismiss the amended complaint on statute of
limitations grounds.
¶ 19 On May 17, 2011, Cronin filed a request for arbitration on Carlson’s behalf with the CBOE.
Id. ¶ 17. Carlson alleged that his former business partners were fiduciaries and had committed
fraud by withholding information regarding Belvedere’s value. O’Neill and Hutchinson filed a
motion to dismiss the arbitration.
¶ 20 On July 13, 2011, Carlson and Collins entered into a tolling agreement whereby Carlson
voluntarily dismissed his amended legal malpractice complaint against Collins, without prejudice.
Id. ¶ 18. The tolling agreement provided that if the arbitration action was “resolved on or after
April 13, 2012, [Carlson] shall have a period of 90 days after resolution of the arbitration to refile
this action. If the arbitration is resolved before April 13, 2012, the one-year refiling provision in
735 ILCS 5/2-1009 shall remain intact.” Id. The tolling agreement further provided that it “shall
not act to revive any cause(s) of action already barred by the statute of limitations when the legal
malpractice complaint was filed on November 18, 2010.” The CBOE eventually dismissed the
arbitration with prejudice on March 5, 2012. Id. ¶ 19; Willis Capital LLC, 2015 IL App (1st)
132183, ¶ 12.
¶ 21 On March 26, 2012, pursuant to section 2-1401 of the Code of Civil Procedure (Code) (735
ILCS 5/2-1401 (West 2012)), Carlson through Cronin filed a petition, and subsequent amended
petition, in the circuit court, seeking to “reopen” the settlement agreement. Carlson II, 2021 IL
App (1st) 191961, ¶ 19; Willis Capital LLC, 2015 IL App (1st) 132183, ¶¶ 1, 13. The amended
petition alleged the following: O’Neill and Hutchinson had fraudulently concealed information
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regarding the value of Belvedere prior to execution of the settlement agreement; the provision in
the settlement agreement waiving fiduciary duties was unenforceable; and the CBOE’s dismissal
of the arbitration had no preclusive effect on the petition. Willis Capital LLC, 2015 IL App (1st)
132183, ¶ 1.
¶ 22 O’Neill and Hutchinson filed a motion to dismiss the amended petition pursuant to section
2-619.1 of Code (735 ILCS 5/2-619.1 (West 2012)). They argued that the amended petition was
barred by the two-year statute of limitations applicable to section 2-1401 petitions. They further
argued that the amended petition was barred by the CBOE’s order dismissing the arbitration and
by the release contained in the settlement agreement. They also contended that the amended
petition was barred by Illinois Supreme Court Rule 201(b)(3) (eff. July 1, 2014), which protects
the identity of consultants, their opinions, and work product from discovery, except under
“exceptional circumstances.” Carlson II, 2021 IL App (1st) 191961, ¶ 19; Willis Capital LLC,
2015 IL App (1st) 132183, ¶ 14.
¶ 23 On June 7, 2013, the circuit court dismissed the amended petition with prejudice. Carlson
II, 2021 IL App (1st) 191961, ¶ 20; Willis Capital LLC, 2015 IL App (1st) 132183, ¶ 15. The court
determined that the amended petition failed to state a claim for rescission of the settlement
agreement because it failed to allege sufficient facts showing that Carlson intended to return the
$17.5 million. The court also determined that the amended petition failed to state a claim for
fraudulent concealment in light of the nonreliance and mutual release clauses contained in the
settlement agreement. The court further found that Carlson failed to exercise due diligence in the
2007 litigation where he never tried to obtain an appraisal of Belvedere prior to the mediation,
even though he was able to produce an appraisal in the present litigation based on documents
available at the time of the settlement. Willis Capital LLC, 2015 IL App (1st) 132183, ¶ 15. The
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court also determined that the amended petition was barred by the doctrine of res judicata and that
Illinois Supreme Court Rule 201(b)(3) (201 Ill.2d R. 201(b)(3)) protected the accounting firm’s
appraisal from disclosure as consultant work product. Id.¶ 24 O’Neill and Hutchinson subsequently filed a petition seeking attorney fees and costs
pursuant to the fee-shifting provision in the settlement agreement. Carlson filed a notice of appeal
on July 5, 2013. On January 6, 2014, the circuit court awarded O’Neill and Hutchinson
$172,391.75 in fees and costs. Willis Capital LLC, 2015 IL App (1st) 132183, ¶ 16. Carlson filed
a second notice of appeal on January 31, 2014, challenging the court’s fee award. This court
consolidated the two appeals (Willis Capital appeal).
¶ 25 While the Willis Capital appeal was pending, Cronin refiled Carlson’s legal malpractice
complaint against Collins on July 5, 2013. Carlson I, 2015 IL App (1st) 140526, ¶ 17. The circuit
court subsequently granted Collins’s motion to dismiss the refiled complaint pursuant to section
2-619(a)(5) of the Code (735 ILCS 5/2-619(a)(5) (West 2012)), finding it was time-barred by the
two-year statute of limitations applicable to legal malpractice actions (735 ILCS 5/13-214.3(b)
(West 2012)). The court determined that the cause of action accrued at the time Carlson knew he
had been injured, which the court found was no later than September 2008. The court found that
by November 12 or 13 of 2008, Carlson had identified his former business partners as the wrongful
cause of his injury, which put him on inquiry notice that a cause of action had accrued. Id. at 19.
The court concluded that because Carlson’s initial legal malpractice complaint was filed on
November 18, 2010, which was more than two years after his cause of action accrued, the
complaint was time-barred by the two-year statute of limitations applicable to legal malpractice
actions. Id. Carlson appealed (Carlson I appeal).
¶ 26 Carlson retained the law firm of Michael Best for a second time on February 27, 2014, to
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act as a consultant in connection with his appeals in Willis Capital and Carlson I.
¶ 27 On appeal in Willis Capital, this court affirmed in part and reversed in part. We affirmed
the circuit court’s dismissal of Carlson’s amended petition to reopen the settlement agreement. We
determined that even if Carlson’s former business partners owed him a fiduciary duty and
fraudulently concealed the results of the appraisal from him, this did not relieve Carlson of his
duty to exercise due diligence in discovering the appraisal value of his interest in Belvedere prior
to the mediation and settlement. Id. ¶¶ 20-23. We reversed the court’s judgment with respect to
the award of attorney fees and costs pursuant to the fee-shifting provision in the settlement
agreement. We determined that the provision was intended to award attorney fees and costs to
prevailing parties who sought to enforce the terms of the settlement agreement, as opposed to
parties, such as O’Neill and Hutchinson, who sought to defend the terms of the agreement in
response to a section 2-1401 petition to invalidate the agreement. Id. ¶¶ 24-25.
¶ 28 On appeal in Carlson I, we affirmed the circuit court’s dismissal of Carlson’s legal
malpractice complaint against Collins. Carlson I, 2015 IL App (1st) 140526, ¶¶ 4, 48. We agreed
with the circuit court that the complaint was time-barred by the two-year statute of limitations
found in section 13-214.3(b) of the Code. We found that correspondence between Carlson and
Collins, which began in September 2008 and continued through November 2008, along with
certain judicial admissions made by Carlson, showed that he was aware he was wrongfully injured
by his former business partners no later than November 13, 2008, and probably as early as
September 2008. Id. ¶¶ 28-33.
¶ 29 Carlson’s second retention of Michael Best ended in May 2015, after Carlson decided not
to file a petition for leave to appeal Carlson I to the Illinois Supreme Court. Carlson discharged
Cronin in June 2015.
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¶ 30 On January 13, 2016, Carlson filed a two-count complaint for legal malpractice in the
circuit court against Michael Best, Cronin, and several attorneys associated with Cronin. Carlson
II, 2021 IL App (1st) 191961, ¶ 28. Carlson filed an amended complaint on August 31, 2016.
Count I of the amended complaint made allegations against Michael Best. Count II made
allegations against Cronin and Cronin attorneys Aaron L. Davis, Leland W. Hutchinson, Jr., and
Daniel J. Kelley (collectively, Cronin defendants).
¶ 31 The circuit court subsequently granted summary judgment in favor of Michael Best and
we affirmed in Carlson II, 2021 IL App (1st) 191961, ¶ 109. In affirming the circuit court’s
decision we determined the following: Michael Best did not cause Carlson to lose any legal
malpractice claims that he may have had against Collins because these claims were time-barred by
the applicable statute of limitations prior to Carlson retaining Michael Best in August 2010;
Michael Best did not cause Carlson to lose any potential legal malpractice claims against Drinker
because these claims were still viable when Carlson retained successor counsel in November 2010;
and Carlson cannot sue Michael Best for failing to inform him of a claim against Michael Best as
there is no duty for a law firm to inform a client that he or she has a claim against it. Id. ¶ 107.
¶ 32 We also determined that the circuit court did not abuse its discretion in denying Carlson
leave to file a second amended legal malpractice complaint where the proposed amendment
concerned allegations that were time-barred by the applicable period of repose and Carlson failed
to establish the first factor set forth in Loyola Academy v. S & S Roof Maintenance, Inc., 146 Ill.
2d 263 (1992), showing that the allegations would cure defects in the prior pleadings. Id. ¶ 106.
We further determined that the court did not abuse its discretion in denying Carlson’s motion to
conduct additional discovery where he failed to support the motion with a Rule 191(b) affidavit.
We finally concluded that the court did not abuse its discretion in declining to address arguments
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Carlson raised in his motion for reconsideration as they were not only waived, but without merit.
Id. ¶ 108.
¶ 33 The present appeal concerns count II of Carlson’s amended legal malpractice complaint
against the Cronin defendants. In this count, Carlson alleged in the alternative, that if it was
determined that his claims against Michael Best were time-barred by the applicable statute of
limitations, then the Cronin defendants breached the applicable standard of care by failing to advise
him that he had potential legal malpractice claims against Michael Best, Drinker, and Collins.
Carlson also alleged overbilling and failure to account for billed time. In response, the Cronin
defendants filed a motion for summary judgment and attorneys Davis, Hutchinson, Jr., and Kelley,
filed their own motion for summary judgment.
¶ 34 The circuit court entered an opinion and order on December 6, 2019, and a subsequent
opinion and order on April 24, 2020, granting the motions for summary judgment on count II of
Carlson’s amended legal malpractice complaint. The court also denied Carlson’s motions for leave
to file second and third amended legal malpractice complaints. Carlson now appeals.
¶ 35 We address Carlson’s claims starting with his contention that the circuit court erred in
granting summary judgment in favor of the Cronin defendants. We provide additional facts in the
analysis section where necessary to address specific issues.
¶ 36 II. ANALYSIS
¶ 37 A. Summary Judgment
¶ 38 “The purpose of summary judgment is to determine whether a genuine issue of material
fact exists that would require a trial.” Hodges v. St. Clair County, 263 Ill. App. 3d 490, 492 (1994).
Summary judgment is appropriate where “the pleadings, depositions, and admissions on file,
together with the affidavits, if any, show that there is no genuine issue as to any material fact and
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that the moving party is entitled to a judgment as a matter of law.” 735 ILCS 5/2-1005(c) (West
2012). “In determining whether a genuine issue as to any material fact exists, a court must construe
the pleadings, depositions, admissions, and affidavits strictly against the movant and liberally in
favor of the opponent.” Gilbert v. Sycamore Municipal Hospital, 156 Ill. 2d 511, 518 (1993). “A
triable issue precluding summary judgment exists where the material facts are disputed, or where,
the material facts being undisputed, reasonable persons might draw different inferences from the
undisputed facts.” Adams v. Northern Illinois Gas Co., 211 Ill. 2d 32, 43 (2004). Our review of a
summary judgment order is de novo. Id.¶ 39 1. Drinker
¶ 40 Carlson first argues that the circuit court erred in granting summary judgment in favor of
Cronin. Carlson contends that he established a prima facie case that Cronin violated the standard
of care by failing to file a legal malpractice lawsuit against Drinker prior to expiration of the statute
of limitations or by failing to obtain a tolling agreement.
¶ 41 Section 13-214.3 of the Code “sets forth two independent timing requirements for legal
malpractice actions: the two-year statute of limitations in subsection (b) and the six-year statute of
repose in subsection (c).” Sorenson v. Law Offices of Theodore Poehlmann, 327 Ill. App. 3d 706,
708 (2002); 735 ILCS 5/13-214.3(b), (c) (West 2014). We focus our attention on subsection (c)
which provides that an action for damages based on tort, contract, or otherwise against an attorney
arising out of an act or omission in the performance of professional services may not be
commenced more than six years after the date on which the act or omission occurred. 735 ILCS
5/13-214.3 (c) (West 2014).
¶ 42 “In contrast to a statute of limitations, which determines the time within which a lawsuit
may be commenced after a cause of action has accrued, a statute of repose extinguishes the action
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after a defined period of time, regardless of when the action accrued.” Evanston Insurance Co v.
Riseborough, 2014 IL 114271, ¶ 16. When the repose period expires, the cause of action is
extinguished and the plaintiff’s right to bring the action is terminated. Evanston Insurance, 2014
IL 114271, ¶ 16. Statutes of repose begin to run “on the last date on which the attorney performs
the work involved in the alleged negligence.” Snyder v. Heidelberger, 2011 IL 111052, ¶ 18.
¶ 43 In this case, the last act or omission which gave rise to Carlson’s potential claims of legal
malpractice against Drinker occurred in October 2009, when Drinker purportedly failed to advise
Carlson of the two-year statute of limitations regarding his claims against Collins. Thus, the six-
year statute of repose started running in October 2009 and ended October 2015. The record shows
that Carlson discharged Cronin in June 2015 and obtained new legal representation. Therefore,
Carlson’s legal malpractice claims against Drinker remained viable nearly four months after
Cronin was discharged.
¶ 44 Our courts have recognized that when a plaintiff’s cause of action remains viable at the
time the attorney is discharged, it cannot be said that the action was lost due to the attorney’s
alleged negligence, since the action still existed at the time the attorney was discharged. See
Nettleton v. Stogsdill, 387 Ill. App. 3d 743, 755-56 (2008). Thus, as a matter of law, Cronin cannot
be deemed a proximate cause of the loss of Carlson’s legal malpractice claims against Drinker
because these claims remained viable months after Cronin was discharged.
¶ 45 2. Individual Attorneys
¶ 46 Carlson next contends that he had viable legal malpractice claims against attorneys Aaron
L. Davis, Leland W. Hutchinson, Jr., and Daniel J. Kelley, in their individual and personal
capacities for failing to advise him about legal malpractice claims he had against Drinker. In
support of this contention Carlson cites to Illinois Supreme Court Rule 721(b) (eff. July 1, 2003).
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The rule provides in relevant pat that “[a]ny attorney who by act or omission causes the
corporation, association, limited liability company, or registered limited liability partnership to act
in a way which violates standards of professional conduct, including any provision of this rule, is
personally responsible for such act or omission and is subject to discipline therefor.” Id.¶ 47 Our courts have determined that although the rules of professional conduct may be relevant
to the standard of care in a legal malpractice claim, the rules, in and of themselves, do not establish
liability in a legal malpractice case. Vandenberg v. Brunswick Corporation, 2017 IL App (1st)
170181, ¶¶ 33-34; Nagy v. Beckley, 218 Ill. App. 3d 875, 881 (1991).
¶ 48 In addition, we further note that it is well established that “[a] claim for legal malpractice
requires (1) an attorney-client relationship, (2) a duty arising from that relationship, (3) a breach
of that duty, and (4) actual damages or injury proximately caused by the breach.” Zweig v. Miller,
2020 IL App (1st) 191409, ¶ 25. The record in this case shows that Carlson entered into an
attorney-client relationship with Thomas Cronin and the Cronin law firm, but not the individual
attorneys employed by the firm. This is evidenced by the November 19, 2010, engagement letter
between Carlson and Cronin, which provided that although the law firm anticipated “using
associate lawyers and perhaps other attorneys to prosecute this litigation,” the firm would “remain
primarily responsible for the prosecution of the litigation.”
¶ 49 Moreover, not only was there not an attorney-client relationship between Carlson and any
of the individual attorneys employed by the Cronin law firm -- no allegations of negligent conduct
were asserted against the attorneys in their individual capacities. Therefore, we find that the circuit
court properly granted summary judgment to attorneys Davis, Hutchinson, Jr., and Kelley, in their
individual capacities.
¶ 50 3. Overbilling
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¶ 51 Carlson next argues that Cronin breached the standard of care by overbilling him for its
legal services. In his initial legal malpractice complaint, Carlson alleged that Cronin billed him in
excess of $750,000, which he claimed was in breach of the attorney fee cap of $250,000 contained
in the retainer agreement. In his amended complaint, Carlson alleged that Cronin billed him in
excess of $750,000 and never provided him with an itemized bill or detailed statement of the work
performed. Carlson claimed that this amount was “unreasonable, unnecessary, or otherwise unfair
because under no circumstance would it cost in excess of $750,000 to work on two motions to
dismiss, two appeals and initiate three legal proceedings.”
¶ 52 Carlson maintains that the circuit court erred in finding that his claim for overbilling was
time-barred, as a matter of law, by the two-year statute of limitations set forth in subsection (b) of
section 13-214.3 of the Code (735 ILCS 5/13-214.3(b) (West 2014)). Subsection (b) provides that
an action for damages “against an attorney arising out of an act or omission in the performance of
professional services *** must be commenced within 2 years from the time the person bringing
the action knew or reasonably should have known of the injury for which damages are sought.”
735 ILCS 5/13-214.3(b) (West 2014). For purposes of a legal malpractice action, a plaintiff is
considered to be injured when he suffers a loss for which he may seek monetary damages. Stevens
v. McGuireWoods LLP, 2015 IL 118652, ¶ 12.
¶ 53 The two-year statute of limitations applicable to legal malpractice actions incorporates the
“discovery rule,” which delays the commencement of the statutory period until the injured party
knows or reasonably should know that he has been injured, and that the injury may have been
wrongfully caused. Hermitage Corp. v. Contractors Adjustment Co., 166 Ill. 2d 72, 77 (1995). The
discovery rule was developed “to avoid mechanical application of a statute of limitations in
situations where an individual would be barred from suit before he was aware that he was injured.”
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Hermitage Corp., 166 Ill. 2d at 77-78.
¶ 54 “The limitations period in a legal malpractice case begins to run from the time the injured
party knows or reasonably should know that he has suffered an injury which was wrongfully
caused.” Brummel v. Grossman, 2018 IL App (1st) 162540, ¶ 26. “There is no requirement that a
plaintiff must discover the full extent of his or her injuries before the statute of limitations begins
to run.” Hoffman v. Orthopedic Systems, Inc., 327 Ill. App. 3d 1004, 1010 (2002). “A person knows
or reasonably should know an injury is ‘wrongfully caused’ when he or she possesses sufficient
information concerning an injury and its cause to put a reasonable person on inquiry to determine
whether actionable conduct is involved.” Carlson I, 2015 IL App (1st) 140526, ¶ 23 (quoting
Hoffman, 327 Ill. App. 3d at 1011). “At that point, the burden is upon plaintiff to inquire further
as to the existence of a cause of action.” Hoffman, 327 Ill. App. 3d at 1011. The question as to
when a plaintiff knew or reasonably should have known of his injury, so as to trigger the statute
of limitations, is ordinarily a question of fact; however, the issue may be determined as a matter
of law where the undisputed facts allow for only one conclusion. Butler v. Mayer, Brown & Platt,
301 Ill. App. 3d 919, 922 (1998).
¶ 55 The central issue to be decided is when Carlson possessed sufficient information such that
he knew or reasonably should have known that he was being overbilled. Carlson contends he was
unaware of any claims of negligence related to overbilling until after he discharged Cronin in June
2015. Carlson asserts that the statute of limitations could not begin to run until sometime after June
2015, and thus, his initial legal malpractice complaint, which was filed in January 2016, was filed
within the two-year statute of limitations.
¶ 56 Carlson argues that he is not seeking liability based on the fee cap being exceeded, but
rather on fact that he was never provided with an itemized bill or detailed statement of work
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performed. We find Carlson’s arguments unpersuasive.
¶ 57 The fee cap provides an appropriate baseline. Once the attorney fee cap of $250,000 was
exceeded, Carlson knew or reasonably should have known that any additional work beyond the
fee cap for which he was billed, was not contemplated in the retainer agreement. The record
contains evidence showing that by the end of 2011, and certainly no later than December 2013,
Carlson possessed sufficient information such that he knew or reasonably should have known that
not only had the fee cap been exceeded, but that he was not receiving itemized billing.
¶ 58 On January 18, 2012, Carlson sent Cronin an email and an attached spreadsheet showing
that by the end of 2011, Carlson had paid Cronin $545,000 in fees.
¶ 59 On August 29, 2013, Carlson sent an email to Cronin stating in part: “I’m bringing [a] fees
spreadsheet for where we currently are,” “[w]e have to make more progress *** We need more
eyes on this.” On September 13, 2013, Carlson emailed Cronin stating in part: “One question is,
what meaningful strides are we making? People we could be updating during these long breaks in
the legal system. Pantle ruled in early June. It’s been 100 days. *** We should have openly
analyzed this already. Pantle ruled 100 days ago. That is a very long time.”
¶ 60 On October 3, 2013, Carlson emailed Cronin stating: “This is a message to you … And
you are in charge of this case. Oh yeah, its hugely important. When do you want to meet? Enough
bulls***.” On November 29, 2013, Carlson emailed Cronin stating in part: “[S]ince nov 2010, we
are now in the 750k range for fees (including consultants, experts).” Then on December 17, 2013,
Carlson sent Cronin an email and an attached spreadsheet showing that by August 2013, Carlson
had paid Cronin $750,000 in fees, and stated that the “damage here is unmistakable.”
¶ 61 This series of emails and spreadsheets, dating from January 2012 to December 2013,
demonstrate that any injury from the alleged overbilling accrued possibly as early as the end of
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2011, but no later than December 2013. By the latter date, Carlson clearly possessed sufficient
information such that he knew or reasonably should have known that he was being overbilled by
Cronin. By December 2013, Carlson possessed sufficient information of an injury from overbilling
and its possible wrongful cause to put a reasonable person on inquiry to determine whether
actionable conduct was involved.
¶ 62 Carlson, however, did not file his action against Cronin until January 13, 2016, more than
two years after December 2013. Therefore, we find the circuit court did not err in finding that
Carlson’s claim against Cronin for overbilling was time-barred, as a matter of law, by the two-year
statute of limitations set forth in subsection (b) of section 13-214.3 of the Code (735 ILCS 5/13-
214.3(b) (West 2014)).
¶ 63 4. Expert Affidavit
¶ 64 Carlson next argues that the circuit court erred in striking the expert affidavit of Attorney
Richard Lehman. Carlson submitted the affidavit in opposition to the Cronin defendants’ motions
for summary judgment. Carlson maintains that the affidavit provided admissible expert testimony.
¶ 65 There is a split of authority whether the standard of review for a circuit court’s ruling on a
motion to strike an affidavit in conjunction with a motion for summary judgment is de novo or
abuse of discretion. See Brettman v. Virgil Cook & Son, Inc., 2020 IL App (2d) 190955, ¶¶ 54-56
(discussing the split of authority). De novo consideration means that the reviewing court performs
the same analysis that a circuit court would perform. Bituminous Casualty Corp. v. Iles, 2013 IL
App (5th) 120485, ¶ 19. We believe that de novo review is the proper standard to apply here
because we review the same documentary evidence, Lehman’s affidavit, as did the circuit court.
See Independent Trust Corp. v. Hurwick, 351 Ill. App. 3d 941, 952 (2004) (circuit court’s
determination based solely on documentary evidence reviewed de novo). In any event, we need
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not attempt to resolve the issue here, as our finding would be the same under either standard of
review.
¶ 66 “An affidavit submitted in the summary judgment context serves as a substitute for
testimony at trial.” Berke v. Manilow, 2016 IL App (1st) 150397, ¶ 21. “The function of affidavits
in summary judgment proceedings is to show whether the issues raised are genuine and whether
each party has competent evidence to offer which tends to support his side of the issue.” Harris
Bank Hinsdale, N.A. v. Caliendo, 235 Ill. App. 3d 1013, 1025 (1992). With these principles in
mind, we examine Lehman’s affidavit to determine whether he raises sufficient genuine issues of
material fact necessary to survive the Cronin defendants’ motions for summary judgment.
¶ 67 In his affidavit, Lehman opined than an error was made in determining when the six-year
statute of repose began to run. Lehman opined that the statute began to run as soon as the event
giving rise to the legal malpractice occurred. According to Lehman, this event occurred in
November/December 2008, when Drinker failed to advise Carlson of the date by which he had to
file his legal malpractice suit against Collins. Lehman stated that the “November/December 2008
Drinker Biddle representation started the running of the statute of repose, and the statute of repose
ran on Carlson’s claim of malpractice against Drinker Biddle in November 2014, while Cronin
still was representing Carlson.”
¶ 68 Contrary to Lehman’s averments concerning when the six-year statute of repose begins to
run, our supreme court has determined that “[t]he period of repose in a legal malpractice case
begins to run on the last date on which the attorney performs the work involved in the alleged
negligence.” (Emphasis added.) Snyder, 2011 IL 111052, ¶ 18. As previously mentioned, the last
act or omission which gave rise to Carlson’s potential claims of legal malpractice against Drinker
occurred in October 2009, when Drinker allegedly failed to advise Carlson of the two-year statute
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of limitations regarding his claims against Collins. Therefore, the six-year statute of repose started
running in October 2009 and ended October 2015. As a result, Lehman’s opinion on this issue
does not create an issue of material fact precluding summary judgment in favor of the Cronin
defendants.
¶ 69 Lehman next opined that the attorney fees Cronin charged Carlson were suspect and
unreasonable. Lehman averred that Cronin charged Carlson over $750,000 in attorney fees without
providing him with an itemized billing statement specifying how the fees were calculated, and the
amount of time spent on various tasks by lawyers and paralegals. Lehman averred that a portion
of the fees Cronin charged was for work on an appeal spanning the time between the January 2014
trial court judgment and the March 2015 appellate court opinion. Lehman opined that Carlson’s
fee claim was not filed outside of the limitation period.
¶ 70 Lehman’s opinions on the reasonableness of the attorney fees incurred by Carlson all relate
to Carlson’s claim of overbilling, a claim which we have determined is time-barred, as a matter of
law, by the two-year statute of limitations set forth in subsection (b) of section 13-214.3 of the
Code (735 ILCS 5/13-214.3(b) (West 2014)). Therefore, Lehman’s opinions here do not create an
issue of material fact precluding summary judgment in favor of the Cronin defendants. See, e.g.,
Xeniotis v. Cynthia Satko, D.D.S., M.S., P.C., 2014 IL App (1st) 131068, ¶ 74 (expert affidavit
failed to raise question of fact with respect to motion for summary judgment). As a result, we find
that the circuit court did not err in striking Lehman’s affidavit.
¶ 71 For the reasons set forth above, we find that the circuit court did not err in granting
summary judgment in favor of the Cronin defendants.
¶ 72 B. Leave to File Third Amended Complaint
¶ 73 Carlson next contends that the circuit court should have granted him leave to file a third
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amended legal malpractice complaint. Carlson argues that “[t]he amendment was timely because
Cronin had time to conduct any discovery needed and this was the second time the claims were
amended against Cronin so there was absolutely no reason [he] should be denied leave to amend.”
¶ 74 Plaintiffs do not have an absolute right to amend a pleading. Giles v. Parks, 2018 IL App
(1st) 163152, ¶ 24. The decision rests in the sound discretion of the circuit court. Id; Abramson v.
Marderosian, 2018 IL App (1st) 180081, ¶ 30. A circuit court abuses its discretion in denying
leave to amend a pleading if granting leave to amend would further the ends of justice. Insurance
Benefit Group, Inc. v. Guarantee Trust Life Insurance Co., 2017 IL App (1st) 162808, ¶ 50.
¶ 75 Our supreme court has identified four factors reviewing courts should consider in
determining whether a circuit court abused its discretion in denying leave to amend a pleading:
“(1) whether the proposed amendment would cure the defective pleading; (2) whether other parties
would sustain prejudice or surprise by virtue of the proposed amendment; (3) whether the proposed
amendment is timely; and (4) whether previous opportunities to amend the pleading could be
identified.” Loyola Academy v. S&S Roof Maintenance, Inc., 146 Ill. 2d 263, 273 (1992). “The
party seeking leave to amend bears the burden of demonstrating that all four factors favor the relief
requested.” United Conveyor Corp. v. Allstate Insurance Co., 2017 IL App (1st) 162314, ¶ 36.
¶ 76 We confine our analysis to the first Loyola factor because it is dispositive. If a party fails
to establish this first factor, showing that the proposed amendment would cure the defective
pleading, then the court need not proceed to consider the remaining three factors. Hayes
Mechanical, Inc. v. First Industrial, L.P., 351 Ill. App. 3d 1, 7 (2004).
¶ 77 Carlson’s proposed third amended complaint merely rehashes the allegations against
Cronin that were contained in count II of the amended complaint. The only differences between
the two are found in paragraphs 154 and 155 of the proposed third amended complaint. Here,
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Carlson alleges additional duties that he claims the Cronin defendants allegedly breached.
However, the allegations against the Cronin defendants remain the same and are not supported or
substantiated by any additional facts. In essence, there was nothing in the pleadings that the
proposed amendment would have cured. Therefore, we find that the circuit court did not abuse its
discretion in denying Carlson leave to file a third amended legal malpractice complaint.
¶ 78 III. CONCLUSION
¶ 79 We find that the circuit court did not err in granting summary judgment in favor of the
Cronin defendants. We also find that the circuit court did not abuse its discretion in denying
Carlson leave to file a third amended legal malpractice complaint.
¶ 80 Affirmed.
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