Susan Ball v. Cherie Kotter
2013 U.S. App. LEXIS 14895
| 7th Cir. | 2013Background
- Hedstrom purchased two Chicago Lake Point Tower units; title for Unit 4705 went to Hedstrom and Kotter as joint tenants with right of survivorship, later fully to Kotter after Hedstrom’s death; Unit 1518 went to the Kotter Family Trust.
- Administrators Ball and Witteried, Hedstrom’s executors, allege Kotter breached fiduciary duty as Hedstrom’s agent and Geldes committed legal malpractice by representing conflicting interests and mishandling title planning.
- Hedstrom and Kotter’s communications and emails reflect title instructions; Geldes drafted and modified deeds and a power of attorney (POA) to implement the plan
- Hedstrom’s will and living trust largely favored Kotter for Unit 4705; Unit 1518 was not referenced in the estate plan; Hedstrom died in 2007, with Ball and Witteried administering the estate.
- District court granted Geldes summary judgment on the legal malpractice claim and later Kotter’s on the fiduciary claim; on appeal, the panel affirms the district court’s judgments.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether expert testimony was required for Geldes’ legal malpractice claim | Administrators: expert testimony needed to prove standard of care | Geldes: common knowledge rule could apply | Yes; expert testimony required; common knowledge rule not applicable; Geldes affirmed |
| Whether Kotter breached fiduciary duty by her role and benefit from the transactions | Administrators: presumption of fraud/undue influence applies | Kotter: presumption rebutted by fair dealing and Hedstrom’s understanding | Kotter’s evidence rebutted presumption; summary judgment for Kotter affirmed |
| Whether the presumption of fraud and undue influence could be overcome without consideration | Administrators: lack of consideration defeats rebuttal | Kotter: consideration not mandatory where gifts; McFail factors apply | Lack of traditional consideration does not defeat rebuttal; factors considered; Kotter succeeds in rebutting presumption |
| Whether Hedstrom intended Unit titling to reflect his wishes and was fully informed | Administrators: titling inconsistent with Hedstrom’s intent | Kotter: Hedstrom understood legal consequences; complete disclosure provided | Kotter presented clear and convincing evidence Hedstrom understood and consented; presumption burst |
Key Cases Cited
- Franciscan Sisters Health Care Corp. v. Dean, 448 N.E.2d 872 (Ill. 1983) (presumptions of fraud/undue influence; standard for rebuttal advances via McFail factors)
- McFail v. Braden, 166 N.E.2d 46 (Ill. 1960) (three McFail factors guiding rebuttal of presumptions)
- Barth v. Reagan, 564 N.E.2d 1196 (Ill. App. Ct. 1st Dist. 1990) (attorney’s duty to communicate depends on facts; not always common knowledge)
- Sohaey v. Van Cura, 607 N.E.2d 253 (Ill. App. Ct. 2d Dist. 1992) (limits expert testimony on statutory interpretation/legal conclusions; expert needed for duties of care)
- LID Associates v. Dolan, 756 N.E.2d 866 (Ill. App. Ct. 1st Dist. 2001) (limits expert testimony on professional duty; not to be used for statutory interpretation)
- Klaskin v. Klepak, 534 N.E.2d 971 (Ill. 1989) (McFail factors considered persuasive for rebutting presumptions)