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Does A Fee Petition In a Divorce Case Bar A Later Legal Malpractice Claim?

The Second District of the Illinois Appellate Court recently decided Nutter v. Schiller DuCanto & Fleck, 2022 IL App (2d) 210376, in which it held that a legal malpractice claim was barred by res judicata because the lawyer and the client had previously engaged in litigation over the lawyer’s fee petition. The court summarizes the procedural history of the dispute as follows:

¶ 11 On December 18, 2020, defendants moved to dismiss plaintiff’s legal malpractice complaint. They alleged that res judicata barred plaintiff from bringing the action because (1) the legal malpractice case and the fee petition concerned the same parties, (2) the order awarding defendants fees and costs was final, and (3) the fee petition and malpractice action involved the same legal services. See 735 ILCS 5/2-619 (West 2020). In response, plaintiff asserted that res judicata did not bar his legal-malpractice action because he had a right to a jury trial in the legal-malpractice action and no such right in the marriage dissolution proceedings. Thus, application of res judicata would deprive him of his right to a jury trial.

¶ 12 Although the trial court held a hearing on the motion to dismiss, no transcript (or acceptable substitute) from that hearing was filed in this court. See Ill. S. Ct. Rule 323(c) (eff. July 1, 2017). Following that hearing, the trial court granted defendants’ motion to dismiss. In doing so, the court noted in its written order that “plaintiff recognized that the two competing claims could be consolidated and tried together, and even acknowledged that the court could try both cases together or bifurcated with plaintiff’s claim of legal malpractice tried to a jury and defendant’s petition for Section 508 fees tried in simultaneous or sequential bench trial.” The court continued that “[t]he divorce court judge had set a longer briefing schedule on the petition for fees, and yet there was no response filed by the plaintiff, only the last minute filing of the legal malpractice law case.” The court observed that plaintiff essentially sat on his hands, “pinning all hopes on the motion for continuance based on the recent filing of this [legal malpractice] case filed in the `Law’ division of the court.” This timely appeal followed.

On appeal the court affirmed the dismissal of the legal malpractice complaint holding that because plaintiff failed to prepare a record of the proceedings (no transcript of the hearing was included) the law firm was entitled to dismissal.

As one might expect, I do not believe this decision is fair to potential litigants for a number of reasons. First, the divorce judge has the right to set final fees upon the petition of an attorney. That proceeding does not include a jury trial and there is no means of which I am aware for the person resisting the fee petition to carry the burden of proof. There is no caselaw in Illinois allowing the person resisting the fee petition to retain and disclose a testifying expert. Without a testifying expert there is no way to establish the standard of care and that the attorney breached the standard of care. I advise clients to simply pay the fees and file the malpractice case separately (if the facts warrant such a filing).  There is no practical way for a party resisting legal fees to meet the burden of proof required to prove legal malpractice in opposition to a fee petition. Granting the lawyers a dismissal on grounds of res judicata gives the lawyer a “free pass” from any malpractice litigation. This free pass would only apply to divorce lawyers. It would not apply to other types of lawyers. The Nutter decision is poorly reasoned and a gift to divorce lawyers who can simply refuse to compromise fee bills to avoid malpractice litigation.

The other problem with the Nutter decision is that the malpractice may involve the failure to protect an asset and the lawyer may not have charged any fees for the negligent act or omission. Simply by filing a fee petition, the lawyer gets a break that he should not be entitled to.

For example, a lawyer commits malpractice by failing to investigate all of the assets of the parties to the divorce and one of them hides assets. The lawyer never files a dissipation claim. So the lawyer does not charge fees to the client for the dissipation claim because he did not know the client had such a claim. When sued the lawyer brings a fee petition and the legal malpractice case is automatically dismissed. The failure to file the dissipation claim is irrelevant to the fee petition (because the lawyer is not seeking fees for a claim he missed) so there is no conceivable way a client could litigate the malpractice issue in any event.

In sum, the Nutter decision is poorly reasoned, puts the person who is a genuine victim of malpractice behind the 8 ball and gives litigious divorce lawyers a break from malpractice liability that no specialty of lawyers is entitled to. The case should be appealed to the Illinois Supreme Court.

Edward X. Clinton, Jr.



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