Chicago Legal Malpractice Lawyer Blog
In Ring v. Schencker, 2021 IL App (1st) 180909-U, Barry Ring sued his former father-in-law, Richard Schencker for legal malpractice. During the marriage Ring was represented by Schencker in his business dealings. When he was divorced, Ring alleged that Schencker divulged confidential information to the attorneys for Ring’s wife (Schencker’s daughter). According to Ring, they used that information to obtain orders blocking Ring from selling or transferring assets. Judge Thomas Mulroy held a bench trial and held that the alleged disclosures of confidential information did not cause harm to Ring. The Appellate Court affirmed the judgment in favor of the lawyer.
The opinion summarizes Ring’s allegations as follows:
¶ 7 Barry alleged in his amended complaint:
“[Richard] disclosed confidential information about Barry and his business interests to Carol and the attorneys representing her in the Divorce.
***
Included in the information Schencker learned as Barry’s attorney and subsequently improperly disclosed over email was the equity in Barry’s business interests, which Schencker additionally utilized in assisting Carol to prepare a Disclosure Statement listing Barry Ring’s business interests to be filed in the Divorce.
Schencker also provided to Carol’s attorneys in the Divorce information regarding negotiations he conducted as counsel on Barry’s behalf regarding the acquisition of vacant property in Indiana. ***
Schencker even disclosed to Carol’s attorneys certain legal and business strategies Barry used to deal with competitive entities ***.
Schencker advised Carol’s divorce attorneys early in the divorce that Carol was involved in the ownership and control of Colvel and that this could be used to gain leverage against Barry. As a result, Carol’s divorce attorneys used Carol’s role with Colvel to obtain a $400,000 settlement payment for Carol in exchange for, among other things, ending any litigation over the ownership and/or control of Colvel.”
The trial court and the Appellate Court conclusively rejected the allegations of malpractice. It quoted Judge Mulroy’s findings at some length.
¶ 12 The court resolved the malpractice complaint in April 2018. The court said:
“Plaintiff stated numerous times that he was going to transfer assets to disadvantage Carol in the divorce case and he made it clear in a vile way that he was going to make sure that there were no assets for Carol to find so she would have nothing.
Plaintiff further said that he would go after Defendant and make sure that he had nothing. When Carol filed for divorce from Plaintiff, her lawyers filed an ex parte TRO proceeding because Plaintiff had threatened to ruin Carol, had cut Carol off from the use of her credit cards, had money removed from the parties’ joint bank account and had attempted to mortgage a property. ***
Almost immediately after the entry of the TRO, Plaintiff’s counsel had it modified to remove the restrictions on Plaintiff’s business accounts. Thereafter the divorce court entered a preliminary injunction against Plaintiff which superseded the TRO. The preliminary injunction order does not enjoin any of Plaintiffs business financial accounts or real estate property. The TRO was filed in July and by August there was no order from the divorce court enjoining Plaintiff from proceeding with his plans to develop the Colvel property.
***
The Court found Plaintiff Barry Ring to be unbelievable and incredible. He was vague in his answers and not forthcoming or truthful.
*** Plaintiff *** failed to prove any damage resulting from the alleged disclosures.
***
*** There is no evidence that Defendant’s acts caused the filing of the TRO; Carol’s divorce attorney said it was her decision to file for a TRO. There was no evidence that Plaintiffs divorce counsel was unable to immediately defend and to modify the TRO or that this TRO was unusual or out of the ordinary in a divorce matter. There was no evidence that information from Defendant led to Plaintiff’s business being interrupted or impaired.
*** The divorce lawyer testified that he encouraged Plaintiff to settle the divorce case because it would have cost more than the $400,000 settlement to litigate the case. The $400,000 settlement also ensured that his daughters would have a home to live in, would resolve the significant issues related to the prenuptial agreement, and would resolve every other property claim that Carol may have had.”
¶ 13 The court entered a judgment in favor of Richard.
The Appellate Court agreed that Ring did not prove any damages. Notably both lawyers in the divorce case testified at trial and rejected Ring’s claims. The divorce lawyers testified that they acted for reasons independent of any alleged disclosures.
Comment: this is classic example of a case with no solid proof that the lawyer caused any damage to his client.