Storino, Ramello & Durkin v. Rackow
45 N.E.3d 307
Ill. App. Ct.2016Background
- SRD (Storino, Ramello & Durkin) represented Anita and Mario Rackow (and other property owners) in a Village of Bensenville special-assessment lawsuit seeking millions in improvements; each Rackow signed a contingent-fee retainer in 2007.
- The retainer provided SRD would receive "one-fourth (1/4th) of whatever savings may be realized as a result of the objections to the Petition" and that SRD was not entitled to a fee unless there was a reduction in the proposed assessment.
- SRD litigated the case for ~3½ years (appearances, discovery, expert, settlement negotiations); the Village voluntarily dismissed the petition with prejudice in 2010.
- SRD sued the Rackows in Cook County for breach of contract, seeking fees and advances totaling $109,595.76.
- Trial court struck Rackows’ affirmative defenses (unjust enrichment, public policy), denied discovery requests for other clients’ fee contracts, denied transfer of venue, and granted SRD summary judgment.
- Appellate court affirmed: it held the contingent-fee agreement unambiguous, a dismissal to zero constituted a "savings" realized by SRD’s objections, and other trial rulings were proper.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether SRD earned contingent fees where the Village voluntarily dismissed the assessment | The dismissal resulted from SRD’s objections/settlement efforts and produced a "savings"; contract entitles SRD to 1/4 of that savings | No fee due because Rackows never bore the assessment; voluntary dismissal by Village does not show savings "realized as a result of the objections" | Fee enforceable: reduction to zero is a "savings" and Ramello affidavit sufficed to link dismissal to SRD’s efforts; summary judgment for SRD affirmed |
| Whether the contingency clause is ambiguous ("at the time of recovery"; "whatever savings may be realized") | Clause is clear; examples in retainer and plain meaning show fee triggers on realized reduction | Clause ambiguous; implies assessment must have been levied or lowered from an imposed amount | Court: contract language unambiguous; ordinary meaning applies; reduction to zero fits clause |
| Whether trial court erred by denying transfer of venue to Du Page County | Venue proper in Cook because retainer was executed and most work occurred in Cook County | Venue should be Du Page because underlying assessment litigation and properties were located there | Denial of transfer affirmed; transaction giving rise to suit occurred in Cook County |
| Whether Rackows' affirmative defenses (unjust enrichment, public policy) survive | SRD’s multiple fees and alleged benefit to other clients render fee unconscionable/public-policy violative | Contract governs; defenses legally insufficient | Defenses struck: unjust enrichment inappropriate in breach-of-contract; public policy claim unsupported |
Key Cases Cited
- Bishop v. Bucklen, 390 Ill. 176 (affirming that reduction of liability to zero can constitute a recoverable "savings")
- Corral v. Mervis Industries, Inc., 217 Ill. 2d 144 (standard of review for venue determinations: factual findings reviewed for manifest weight; legal conclusions de novo)
- Pedersen & Houpt, P.C. v. Summit Real Estate Group, LLC, 376 Ill. App. 3d 681 (law firms may represent themselves in fee-collection suits against former clients)
- Pyne v. Witmer, 129 Ill. 2d 351 (elements for granting summary judgment; plaintiff must establish each element)
- Gallagher v. Lenart, 226 Ill. 2d 208 (contract interpretation is a question of law reviewed de novo)
- Nicor, Inc. v. Associated Electric & Gas Insurance Services Ltd., 223 Ill. 2d 407 (ambiguity exists only when contract language has more than one reasonable interpretation)