ESTATE OF PERRY C. POWELL, a/k/a Perry Smith, Jr., a Disabled Person, by Robert F. Harris, Cook County Public Guardian, Plaintiff-Appellant, v. JOHN C. WUNSCH, P.C., an Illinois Professional Corporation; PHILLIPS LAW OFFICES, LTD., an Illinois Corporation; JOHN C. WUNSCH, an Individual; JEREMY L. DERSHOW, an Individual; JILL M. WEBB, an Individual; and LEONA SMITH, an Individual, Defendants-Appellees
Docket No. 1-12-1854
Appellate Court of Illinois, First District, Third Division
March 29, 2013
2013 IL App (1st) 121854
(Note: This syllabus constitutes no part of the opinion of the court but has been prepared by the Reporter of Decisions for the convenience of the reader.)
In a legal malpractice action arising from defendants’ representation of decedent‘s wife, daughter and disabled son in the litigation and settlement of a wrongful death action against decedent‘s medical providers, the trial court properly dismissed the first count of the disabled son‘s complaint alleging that he was deprived of his full share of a $5,000 settlement he received in the wrongful death action due to defendants’ negligent failure to provide for supervision of the distribution by the probate court, since the Wrongful Death Act only requires court supervision for settlements in excess of $5,000, but the dismissal of the count alleging negligence with regard to the distribution of a settlement exceeding $5,000 was reversed, because plaintiff alleged that defendants did not petition the court to appoint a guardian for plaintiff in order to protect his interest in the settlement.
Decision Under Review
Appeal from the Circuit Court of Cook County, No. 10-L-9584; the Hon. Kathy M. Flanagan, Judge, presiding.
Affirmed in part and reversed in part; cause remanded.
Counsel on Appeal
Roetzel & Andress, LPA, of Chicago (Mark D. Belongia, Richard K. Hellerman, and Harry O. Channon, of counsel), for appellant.
Mulherin, Rehfeldt & Varchetto, P.C., of Wheaton (Patricia L. Argentati, and Shana A. O‘Grady, of counsel), for appellees John C. Wunsch, P.C., John C. Wunsch, and Jeremy L. Dershow.
Konicek & Dillon, P.C., of Geneva (Daniel F. Konicek, Amir R. Tahmassebi, and Michael J. Corsi, of counsel), for appellees Phillips Law Offices, Ltd., and Jill M. Webb.
Panel
JUSTICE STERBA delivered the judgment of the court, with opinion. Justices Hyman and Pierce concurred in the judgment and opinion.
OPINION
¶ 1 Plaintiff-appellant estate of Perry C. Powell, a/k/a Perry Smith, Jr., appeals the dismissal of his legal malpractice counts against defendants-appellees John C. Wunsch, P.C., Phillips Law Offices, Ltd., John C. Wunsch, Jeremy L. Dershow and Jill M. Webb (hereinafter collectively referred to as defendants) pursuant to
¶ 2 When reviewing a circuit court‘s ruling on a
¶ 3 The circuit court adjudicated Powell disabled due to profound disability on April 25, 1997, and appointed his parents, Leona Smith and Perry Smith, to serve as co-guardians of his person, but they were not appointed to serve as a guardian of his estate. Perry died on April 11, 1999, from surgical complications. He was survived by his wife, Leona, and his two children, Powell and Emma Smith. On April 12, 1999, Leona executed an attorney-client agreement with the John C. Wunsch, P.C., for the purpose of bringing a wrongful death action against the medical providers who treated Perry before his death. Perry died intestate and his estate had no assets. Also, no petition for letters of office of Perry‘s estate were filed with the probate court.
¶ 4 On January 31, 2001, Leona filed a petition to appoint a special administratrix (petition for appointment) naming herself as the special administratrix of Perry‘s estate. The petition for appointment identified Leona, Powell and Emma as Perry‘s next of kin and stated that they were entitled to recover under the Act and the
¶ 5 On January 31, 2001, John C. Wunsch, P.C., filed a complaint in the circuit court entitled “Leona Smith, Individually and as Special Administratrix of the Estate of Perry Smith v. Bradley Coolidge, M.D., et al.” The complaint was amended on September 7, 2004, and included five counts under the Act, one count under the
¶ 6 On October 15, 2005, John C. Wunsch, P.C., referred the action to Jill Webb, who was an attorney at the Phillips Law Offices, because the primary attorney at John C. Wunsch, P.C., who worked on the action disassociated with the firm and the remaining attorneys at John C. Wunsch, P.C., decided that they were unable to take the wrongful death action to trial. On that same day, Leona executed an attorney-client agreement with the Phillips Law Offices to continue litigating the underlying wrongful death action. On November 1, 2005, the Phillips Law Office, Webb, and John C. Wunsch, P.C., participated in settlement negotiations with the remaining defendants in the underlying wrongful death action and
¶ 7 In approximately 2008, Emma became concerned about Powell‘s hygiene and well-being after visiting him at Leona‘s home. On December 5, 2008, Emma petitioned the probate court to remove Leona as guardian of Powell‘s person, or to appoint her as co-guardian, because Leona had become incapable of providing the necessary care to Powell. This petition also asserted that the funds distributed to Powell from the second settlement were deposited into a joint bank account in Powell‘s and Leona‘s names. The petition further alleged that Powell‘s funds from the second settlement were not being expended toward his care.
¶ 8 On January 23, 2009, the probate court entered an order appointing James Dunneback as guardian ad litem for Powell. On February 2, 2009, Dunneback filed an emergency petition to appoint a temporary guardian of Powell‘s person and seeking to suspend Leona‘s authority as guardian. On June 9, 2009, the probate court entered an order removing Leona as Powell‘s guardian of his person and appointing Emma as the plenary guardian of Powell‘s person. On July 8, 2009, the probate court appointed the public guardian as plenary guardian of the estate of Powell.
¶ 9 The public guardian filed a complaint against defendants and filed an amended complaint, second amended complaint, third amended complaint and fourth amended complaint. The fourth amended complaint (complaint) included the following counts: (1) professional negligence against John C. Wunsch, P.C., John C. Wunsch, and Jeremy L. Dershow (Wunsch defendants); (2) professional negligence against the Phillips Law Offices, Ltd., Jill M. Webb, John C. Wunsch, P.C., and John C. Wunsch; (3) fraud against Leona; (4) breach of fiduciary duty against Leona; and (5) unjust enrichment against Leona.
¶ 10 Wunsch defendants filed a section 2-619 motion to dismiss the complaint, an amended section 2-619 motion to dismiss the amended complaint, a
¶ 11 On June 18, 2012, the circuit court granted defendants’
ANALYSIS
¶ 12 Powell contends on appeal that the circuit court erred in granting defendants’
¶ 13 A
¶ 14 Turning first to the duty element of a legal malpractice action, we must decide in the case sub judice whether defendants litigating the wrongful death action owed Powell a duty to ensure that his portion of the settlement proceeds received as a next of kin in the underlying wrongful death action were distributed in accordance with the Act. To find that defendants owed Powell a duty, an attorney-client relationship must have existed between them, or Powell must have been an intended beneficiary of such a relationship. Powell contends that an attorney-client relationship existed based on his classification as Perry‘s next of kin and defendants were retained by the special administratrix of Perry‘s estate to bring a wrongful death action against the underlying defendants-doctors.
¶ 16 In the case sub judice, the record clearly establishes, and defendants do not dispute, that defendants were retained to bring a wrongful death action pursuant to the Act against the underlying defendant doctors.
“Every such action shall be brought by and in the names of the personal representatives of such deceased person, and, except as otherwise hereinafter provided, the amount recovered in every such action shall be for the exclusive benefit of the surviving spouse and next of kin of such deceased person. In every such action the jury may give such damages as they shall deem a fair and just compensation with reference to the pecuniary injuries resulting from such death, including damages for grief, sorrow, and mental suffering, to the surviving spouse and next of kin of such deceased person.
The amount recovered in any such action shall be distributed by the court in which the cause is heard or, in the case of an agreed settlement, by the circuit court, to each of the surviving spouse and next of kin of such deceased person in the proportion, as determined by the court, that the percentage of dependency of each such person upon the deceased person bears to the sum of the percentages of dependency of all such persons upon the deceased person.” (Emphasis added.)
740 ILCS 180/2 (West 2008) .
“If a judgment is entered or the action is settled in favor of the special administrator, he or she shall distribute the proceeds as provided by law, except that if proceeds in excess of $5,000 are distributable to a minor or person under legal disability, the court shall allow disbursements and fees to the special administrator and his or her attorney and the balance shall be administered and distributed under the supervision of the probate division of the court if the circuit court has a probate division.”
740 ILCS 180/2.1 (West 2008) .
The Act‘s intended purpose is to create a cause of action for an individual‘s death caused by the wrongful act, neglect or default of another. Pasquale v. Speed Products Engineering, 166 Ill. 2d 337, 360 (1995). A wrongful death action serves to compensate a decedent‘s surviving spouse and the next of kin for the pecuniary losses resulting from the decedent‘s death. Id. A decedent‘s personal representative is the only party that may bring a wrongful death action.
¶ 17 For purposes of this appeal, we accept as true Powell‘s factual assertion that he was Perry‘s next of kin, and the record contains ample support for accepting that assertion as true. For instance, the record includes the amended complaint filed by Wunsch defendants on September 7, 2004 against the underlying defendant doctors that identified Powell as Perry‘s son in each of the seven counts raised in that complaint. The record also includes a letter written by attorney Dershow at John C. Wunsch, P.C. on May 1, 2003, to opposing counsel that identified Powell as Perry‘s son, and it stated that Powell had a mental condition that prevented him from testifying at trial. The letter further stated that “it should not be assumed that there has been any waver [sic] of rights under the Illinois Wrongful Death Act pertaining to the interests of Perry Smith, Jr. Plaintiff, therefore, is preserving and protecting the rights of Perry Smith, Jr. as a heir of the decedent under the Illinois Wrongful Death Act.” (Emphasis in original.) Accordingly, Powell should be considered a next of kin in the instant appeal for purposes of determining whether defendants owed him a duty. Because Powell was a next of kin, the Act was intended to compensate him, in addition to Leona, as a surviving spouse, and his sister Emma, also as a next of kin, for the pecuniary losses resulting from Perry‘s death. Pasquale, 166 Ill. 2d at 360.
¶ 18 Next, we turn to the nature of the attorney-client relationship between defendants and the next of kin. In the case sub judice, the record establishes that Leona executed the attorney-client agreements with defendants for the purpose of pursuing a wrongful death action against the underlying defendant doctors, and the circuit court granted her petition to be named as special administratrix of Perry‘s estate. According to the Act, wrongful death actions are brought in the name of the decedent‘s personal representative, but, unless otherwise provided, the surviving spouse and next of kin are statutorily identified as the beneficiaries of such a cause of action. See
¶ 19 We acknowledge that defendants did not directly enter into an attorney-client relationship with Powell, but such a relationship is not necessary because a wrongful death action, even though it is not brought by the next of kin, is litigated for the exclusive benefit of the next of kin.
¶ 20 Despite the absence of a direct attorney-client relationship, defendants owed Powell a duty based on his classification as a next of kin in a wrongful death action brought pursuant to the Act. Powell relies on the Illinois Supreme Court‘s decision in DeLuna v. Burciaga, 223 Ill. 2d 49 (2006), to support his position that an attorney owes a duty to a next of kin in a wrongful death action. Defendants contend that Powell‘s reliance on DeLuna is misplaced because the issue disposed of in DeLuna did not address the issue forming the basis of the instant appeal. The issues raised in DeLuna mainly addressed the applicability of the statute of repose for legal malpractice claims relating to a wrongful death action, and whether it is tolled while a plaintiff is a minor, on equitable grounds and where the attorney fraudulently concealed facts relating to a viable cause of action. Id. at 59-60. In DeLuna, the court reiterated the characteristics of an attorney-client relationship, noting particularly that such a relationship constitutes a fiduciary relationship. Id. at 77-78. The DeLuna court elaborated that, generally, an attorney owes a duty only to his client, but an exception to that rule arises when an attorney is hired specifically for the purpose of benefitting a third party, which occurs in a wrongful death action. Id. at 79. The court concluded that the wrongful death action in DeLuna was indisputably brought for the benefit of the decedent‘s next of kin, and the attorney hired by the decedent‘s special administrator to bring that cause of action owed the next of kin a fiduciary duty. Id.
¶ 21 We acknowledge that DeLuna‘s holding related to a legal malpractice claim in the context of fraudulent concealment of facts, which is not on point with the issue that we now face, but the DeLuna court, nonetheless, clearly explained the nature of an attorney‘s relationship with the next of kin in a wrongful death action. The DeLuna court‘s recognition that the next of kin is the intended beneficiary in a wrongful death action and that the attorney litigating that action owes a fiduciary duty to the next of kin is on point with the instant case, and we must adhere to the general propositions that the Illinois Supreme Court set forth in that case. Accordingly, we find DeLuna instructive in the disposition of the case sub judice.
¶ 22 We are also guided by the Illinois Supreme Court‘s decision in Carter v. SSC Odin Operating Co., LLC, 2012 IL 113204. Even though Carter dealt specifically with the applicability of an arbitration agreement to an action brought under the Act, the court generally analyzed who may bring a claim under the Act and who that claim belongs to based on the Act‘s language and legislative intent. Id. ¶¶ 14, 33. The Carter court also provided an overview of the Act. Id. The court recognized that a wrongful death action shall be brought in the name of the decedent‘s “personal representative,” but the action is for the exclusive benefit of the decedent‘s next of kin and the personal representative in such a claim is ” ‘merely a nominal party to this action, effectively filing suit as a statutory trustee on behalf of the surviving spouse and next of kin, who are the true parties in interest.’ ” Id. ¶ 33 (quoting Glenn v. Johnson, 198 Ill. 2d 575, 583 (2002)). Applying the commonly recognized principles of statutory construction, the Carter court held that although the Act refers to a wrongful death action as an asset of the deceased‘s estate, a wrongful death action is not treated the same as the other assets of a decedent‘s estate. Id. ¶ 38. In fact, the Carter court expressly concluded “that a wrongful-death action is not a true asset of the decedent‘s
¶ 23 Although the Illinois Supreme Court‘s holdings in DeLuna and Carter do not specifically address the question of whether an attorney owes a duty to a legally disabled next of kin when litigating and distributing recoveries in a wrongful death action, the court‘s reasoning in those cases provides us with the necessary guidance here to answer that very question. Based on the reasoning and the holdings reached in those cases and the Act‘s express language, we conclude that an attorney litigates a wrongful death action for the exclusive benefit of the next of kin and owes that party a duty even though the next of kin did not execute a retainer agreement with the attorneys. The established case law in conjunction with the spirit of the Act also supports a conclusion that the duty owed to the next of kin extends to the entire wrongful death action, including distribution of any monies recovered. Moreover, Carter establishes that recoveries received in a wrongful death action are not true assets of the deceased‘s estate because that asset is distributed pursuant to the Act, and not the
¶ 24 Defendants claim that Pelham v. Griesheimer, 92 Ill. 2d 13 (1982), Grimes v. Saikley, 388 Ill. App. 3d 802 (2009), In re Estate of Lis, 365 Ill. App. 3d 1 (2006), Gagliardo v. Caffrey, 344 Ill. App. 3d 219 (2003), and Jewish Hospital of St. Louis, Missouri v. Boatmen‘s National Bank of Belleville, 261 Ill. App. 3d 750 (1994), are more applicable because those cases addressed an attorney‘s duty to nonclients, which is Powell‘s classification. The cases that defendants rely upon, however, are distinguishable from the instant case because those cases do not address the attorney-client relationship in a wrongful death action. Again, as recognized in DeLuna and Carter, next of kin are intended beneficiaries in a wrongful death action, and, as such, an attorney owes a duty to those individuals even though they did not directly retain the attorney. Moreover, the beneficiaries in a wrongful death action should not be considered the same as individual beneficiaries of a decedent‘s estate, where a potential conflict of interest may arise between the estate‘s interest and the interest of each of the beneficiaries of the estate. In the case sub judice, the same conflict of interest concerns should be considered irrelevant because Powell is a next of kin and a wrongful death action is brought on behalf of a next of kin. Also, wrongful death settlements are distributed according to the Act‘s requirements and not through the procedure generally provided for in the administration and distribution of other estate assets. See Carter, 2012 IL 113204, ¶¶ 38-39. Having established that an attorney does owe a duty to a next of kin throughout a wrongful death action, we must next consider whether Powell properly alleged facts supporting the existence of a duty in his complaint.
¶ 25 Turning to Powell‘s complaint, we note that he alleged that defendants represented Perry‘s next of kin in a wrongful death action, they represented themselves as attorneys for the next of kin and that an attorney-client relationship existed with the next of kin. Powell also alleged, in the alternative, that he was an intended beneficiary of defendants’ legal services relating to the wrongful death action. Powell further alleged that the Wunsch defendants, as referring attorneys, had the same legal responsibilities as the Phillips defendants regarding the performance of legal services on behalf of the next of kin relating
¶ 26 Powell next contends on appeal that the circuit court erred in dismissing his complaint pursuant to
¶ 27 To satisfy the proximate cause element in a legal malpractice cause of action, the plaintiff must plead sufficient facts establishing that ” ‘but for’ the attorneys’ malpractice, plaintiff would have prevailed in the underlying action.” Preferred Personnel Services, Inc. v. Meltzer, Purtill & Stelle, LLC, 387 Ill. App. 3d 933, 939 (2009). In Powell‘s complaint, he brought count I against the Wunsch defendants and alleged that absent their negligent acts, a guardian would have been appointed for his estate to receive and protect his portion of the settlement funds, and because a guardian was not appointed, he was deprived of his portion of the settlement funds. Powell embodied these allegations specifically in reference to the first settlement. We note that the amount allocated to Powell in that settlement was $5,000. Pursuant to
¶ 28 Powell brought count II against the Phillips defendants, John C. Wunsch, P.C., and John C. Wunsch. Powell pled similar factual allegations in this count as in count I; however, this count referred to the second settlement. Unlike the first settlement, the amount allocated to Powell in the second settlement exceeded $5,000 and totaled $118,091.34. Because the settlement amount exceeded $5,000, the probate court should have supervised the administration and distribution of the settlement proceeds allocated to Powell in accordance with
¶ 29 On appeal, defendants contend that we may affirm the circuit court‘s decision on any grounds appearing in the record and we are not bound by the basis relied upon by the circuit court. The Wunsch defendants also claim that the contentions they set forth in their section 2-619(a)(9) motion to dismiss remain valid and may be considered by this court as a basis to dismiss Powell‘s legal malpractice counts.
¶ 30 In the Wunsch defendants’
¶ 31 In sum, a wrongful death action is brought for the exclusive benefit of a decedent‘s next of kin, and an attorney litigating such an action owes a duty to the next of kin. Defendants owed a duty to Powell because he was identified as a next of kin in a wrongful death action. At this stage of the proceedings, Powell was not required to prove his case, but only to allege sufficient facts to state all of the elements of a legal malpractice cause of action. Fox v. Seiden, 382 Ill. App. 3d 288, 294 (2008). Construing the allegations in the complaint liberally, as we are required to do, and in the light most favorable to Powell, we conclude that he sufficiently pled the elements of duty and proximate cause in his complaint regarding count II, and the circuit court erred in dismissing that count from his complaint pursuant to a
CONCLUSION
¶ 32 For the reasons stated, we affirm in part and reverse in part the circuit court‘s grant of defendants’
¶ 33 Affirmed in part and reversed in part; cause remanded.