2021 IL App (5th) 190360
Ill. App. Ct.2021Background:
- Plaintiffs Midwest Sanitary Service, Nancy Donovan, and Bob Evans Sr. sued their former counsel (Sandberg, Phoenix & Von Gontard, P.C., John Gilbert, and Narcisa Symank) for legal malpractice after an underlying retaliatory-discharge jury verdict in favor of the employee, Paul Crane.
- Plaintiffs alleged multiple attorney errors (including discovery/trial witness omissions, failure to preserve/explain a destroyed voicemail, problematic cross-examination, and refusal to negotiate settlement) that caused the adverse verdict and punitive damages awards they were required to pay.
- Plaintiffs sought recovery of compensatory damages and reimbursement for punitive damages they actually incurred as a result of counsel’s negligence.
- Defendants moved to dismiss, arguing Illinois law (735 ILCS 5/2-1115) and public policy bar recovery of punitive damages in malpractice claims.
- The trial court denied the motion and certified under Ill. S. Ct. Rule 308 the question whether incurred punitive damages may be recovered in a malpractice action; the appellate court was ordered to hear the appeal.
- The Fifth District answered the certified question in the negative, affirming the trial court and remanding for further proceedings.
Issues:
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a malpractice plaintiff may recover punitive damages it actually paid in the underlying case | Such punitive damages are compensatory vis-à-vis the negligent attorney because they were proximately caused by the attorney’s malpractice | Recovery is barred by statute (735 ILCS 5/2-1115) and public policy; Tri-G and related precedent prohibit lost-punitive recovery | No — incurred punitive damages imposed on a client as a proximate result of attorney negligence are compensatory in a malpractice action and are not barred; certified question answered in the negative |
Key Cases Cited
- Tri-G, Inc. v. Burke, Bosselman & Weaver, 222 Ill. 2d 218 (2006) (Illinois Supreme Court held plaintiff could not recover lost punitive damages from its attorney and discussed policy concerns)
- Ferguson v. Lieff, Cabraser, Heimann & Bernstein, LLP, 69 P.3d 965 (Cal. 2003) (California precedent relied on by Tri-G regarding denial of lost punitive damages against attorneys)
- Haudrich v. Howmedica, Inc., 169 Ill. 2d 525 (1996) (articulates general tort rule that a wrongdoer is liable for damages that are the natural and proximate consequences of the wrongful act)