Goodman v. Hanson
945 N.E.2d 1255
Ill. App. Ct.2011Background
- Executor of Edith-Marie Appleton's estate; decedent funded a trust in which the plaintiff was co-trustee and beneficiary.
- Hanson and EPPE represented the estate/trust; a prior Illinois estate and GST tax return malpractice claim settled with a general mutual release.
- Settlement included a release of all claims from the first suit and a probate court order dismissing those claims with prejudice under the agreement.
- Second lawsuit (2007) asserted malpractice claims including a federal estate tax deduction issue not raised in the first suit.
- Question presented: whether the release forecloses the second suit based on the Federal return issue and whether res judicata bars the second suit.
- Court granted Rule 308 interlocutory review and resolved the certified questions against the plaintiffs.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does the release bar the federal return claim in the second suit? | Release was not intended to cover unknown claims; the federal deduction issue was not contemplated. | Release language is general and includes claims that could have been asserted in the first litigation and related to administration of the estate/trust. | No; the court held the second suit is barred by the release. |
| Is the second suit barred by res judicata based on the first suit’s dismissal with prejudice? | Dismissal with prejudice constitutes a final judgment on the merits; bars relitigation. | Settlements and agreed dismissals are not final judgments on the merits. | No; res judicata does not apply because there was no final merits judgment in the first suit. |
Key Cases Cited
- Whitlock v. Farm Credit Bank of St. Louis, 144 Ill.2d 440 (1991) (general release language can bar unknown claims if within scope; but context matters)
- Myers v. Health Specialists, S.C., 225 Ill.App.3d 68 (1992) (specific release narrowed by its language; not all-encompassing)
- Thornwood, Inc. v. Jenner & Block, 344 Ill.App.3d 15 (2003) (sweeping or second releases may bar or not bar depending on scope and knowledge)
- Gavery v. McMahon & Elliott, 283 Ill.App.3d 484 (2000) (release that is very specific can bar later claims arising from same dispute)
- Janowiak v. Tiesi, 402 Ill.App.3d 997 (2010) (release language can be general; issues of contemplation and fiduciary duties debated)
- River Park, Inc. v. City of Highland Park, 184 Ill.2d 290 (1998) (transactional approach to determining same cause of action)
- Hudson v. City of Chicago, 228 Ill.2d 462 (2008) (restatement of res judicata elements)