Kreykes Electric Inc. v. Malk & Harris

SECOND DIVISION
JUNE 30, 1998

1-97-3562

KREYKES ELECTRIC, INC., ) APPEAL FROM THE
) CIRCUIT COURT OF
Plaintiff-Appellant, ) COOK COUNTY
)
v. ) No. 95-L-016287
)
MALK AND HARRIS, a Law Partnership, ) THE HONORABLE
CHARLES R. MALK AND ASSOCIATES, LTD., ) DAVID G.
CHARLES R. MALK, Indiv., ) LICHTENSTEIN,
STEVEN M. HARRIS, LTD., ) JUDGE PRESIDING.
STEVEN M. HARRIS, Indiv., )
and STEVEN W. WORKMAN, Indiv., )
)
Defendants-Appellees. )

JUSTICE COUSINS delivered the opinion of the court:
Plaintiff, Kreykes Electric, Inc., is an electrical
contractor that brought a legal malpractice action against the
law firm and individual attorneys it had retained to prosecute a
mechanics lien foreclosure. The circuit court of Cook County
granted defendants' motions to dismiss pursuant to Supreme Court
Rule 103(b) (134 Ill. 2d R. 103(b)), finding that plaintiff
failed to exercise reasonable diligence in obtaining service of
process. On plaintiff's motion for reconsideration, the circuit
court allowed its prior order to stand and specifically rejected
plaintiff's argument that defendants waived their Rule 103(b)
defense. On appeal, plaintiff argues that the circuit court
erred by: (1) granting defendants' motions to dismiss
plaintiff's malpractice claim; and (2) not properly considering
plaintiff's waiver argument against defendants' motion to
dismiss.

BACKGROUND
In 1993, plaintiff retained the law firm of Malk &
Harris[fn1] to commence a mechanics lien action. Malk & Harris
made an untimely filing of plaintiff's mechanics lien complaint
on March 4, 1993. By early April 1993, plaintiff substituted the
law firm of McFadden & Dillon for Malk & Harris. On May 3, 1993,
the owner of the subject property filed a motion to dismiss the
mechanics lien claim on the grounds that it was untimely filed.
Soon thereafter, plaintiff's new counsel, with the aid of
attorneys at or associated with Malk & Harris, prepared the
response to the aforementioned motion to dismiss the mechanics
lien suit. During that time, plaintiff also sent a letter to an
attorney at Malk & Harris stating, inter alia, that, should the
dismissal of plaintiff's mechanics lien action be upheld,
plaintiff would seek damages from Malk & Harris for malpractice.
On November 17, 1993, the circuit court dismissed the
mechanics lien suit with prejudice on the grounds that it was not
timely filed. According to plaintiff, an attorney at Malk &
Harris subsequently requested that plaintiff file a notice of
appeal of the November 17, 1993, order and that plaintiff refrain
from proceeding with a malpractice action until the underlying
dismissal order could be challenged on appeal. During the next
two years, the issues on appeal were briefed with some input from
Malk & Harris and argued in October 1995.
As the end of the two-year period following the entry of the
November 17, 1993, dismissal order approached, the decision of
the appellate court was still pending. Consequently, plaintiff
filed the instant complaint on November 16, 1995; one day before
the applicable statute of limitations expired. On December 22,
1995, the appellate court affirmed the dismissal order. Shortly
thereafter, plaintiff decided to proceed with its malpractice
action against defendants and purportedly began preparing
summonses for service upon defendants.
On January 24, 1996, before any summonses were placed for
service, plaintiff failed to appear for a status hearing, and the
trial court dismissed plaintiff's claim for want of prosecution.
Plaintiff subsequently filed a motion to vacate the dismissal,
which was granted on March 1, 1996. Defendants were finally
served with process on April 10, 1996, nearly five months after
plaintiff's malpractice complaint was filed. Defendants answered
with motions pursuant to Supreme Court Rule 103(b) (134 Ill. 2d
R. 103(b)), asserting that plaintiff's lack of diligence in
obtaining service after the expiration of the statute of
limitations warranted dismissal of plaintiff's claim with
prejudice.
On May 14, 1997, the circuit court granted defendants'
motions to dismiss plaintiff's malpractice claim with prejudice
on the grounds that plaintiff failed to exercise reasonable
diligence in effectuating service of process. In addition, the
court, on its own motion, dismissed defendants Steven M. Harris,
Ltd., and Malk & Harris on the grounds that plaintiff never
effectuated service upon them. Plaintiff subsequently filed a
motion for reconsideration, which was granted, in part, by the
circuit court on August 22, 1997. In the order on
reconsideration, the circuit court amended its prior order by
rejecting plaintiff's argument that defendants waived their Rule
103(b) defense, stating that plaintiff's waiver argument was
insufficient. The circuit court upheld its prior order in all
other respects, and plaintiff appeals from both the May 14, 1997,
and August 22, 1997, orders.
We affirm.
ANALYSIS
Plaintiff first contends that the circuit court erred by
granting defendants' motions to dismiss based upon Supreme Court
Rule 103(b). 134 Ill. 2d R. 103(b). That rule provides as
follows:
"Dismissal for Lack of Diligence. If the
plaintiff fails to exercise reasonable diligence to
obtain service prior to the expiration of the
applicable statute of limitations, the action as a
whole or as to any unserved defendant may be dismissed
without prejudice. If the failure to exercise
reasonable diligence to obtain service occurs after the
expiration of the applicable statute of limitations,
the dismissal shall be with prejudice. In either case
the dismissal may be made on the application of any
defendant or on the court's own motion." 134 Ill. 2d R.
103(b).
We note that "[t]he rules of our supreme court are not
aspirational. 'They have the force of law, and the presumption
must be that they will be obeyed and enforced as written.' "
Billerbeck v. Caterpillar Tractor Co., 292 Ill. App. 3d 350, 353,
685 N.E.2d 1018, 1020 (1997), quoting Bright v. Dicke, 166 Ill. 2d 204, 210 (1995). As a rule, the trial court has broad
discretion in granting or denying a motion brought under Rule
103(b) (Marks v. Rueben H. Donnelly, Inc., 260 Ill. App. 3d 1042,
1047, 636 N.E.2d 825, 829 (1994)), and this court will not
disturb the trial court's ruling absent an abuse of that
discretion (Stash v. Doll, 223 Ill. App. 3d 662, 663, 585 N.E.2d 1094, 1096 (1992)). The rule " 'has an essential purpose in
promoting the expeditious handling of suits by giving trial
courts wide discretion to dismiss when service is not effected
with reasonable diligence.' " Segal v. Sacco, 136 Ill. 2d 282,
285-86 (1990) (Ryan, J., dissenting), quoting Karpiel v. LaSalle
National Bank, 119 Ill. App. 2d 157, 161, 255 N.E.2d 61, 63
(1970). Furthermore, Rule 103(b) is not rooted in a subjective
test of the plaintiff's intent but, rather, upon an objective
evaluation of reasonable diligence in obtaining service of
process. Marks, 260 Ill. App. 3d at 1047, 636 N.E.2d at 829,
citing Parker v. Universal Packaging Corp., 200 Ill. App. 3d 882,
886, 558 N.E.2d 203, 205 (1990). We also note that the burden
rests with the plaintiff to demonstrate reasonable diligence in
effectuating service, and the defendant is not required to
establish that it was prejudiced by plaintiff's delay.
Billerbeck, 292 Ill. App. 3d at 352, 685 N.E.2d at 1020; Tischer
v. Jordan, 269 Ill. App. 3d 301, 307, 645 N.E.2d 991, 995 (1995);
Phifer v. Hayes, 20 Ill. App. 3d 635, 640, 314 N.E.2d 473, 476-77
(1974).
All parties in the instant case cite the Illinois Supreme
Court case of Segal as being favorable to their respective cases.
We agree that Segal is instructive in this matter, as it
delineates a seven-factor rule for determining whether a court
should grant a Rule 103(b) motion. The elements to be weighed
are:
(1) the length of time used to obtain service of
process;
(2) the activities of the plaintiff;
(3) the plaintiff's knowledge of the defendant's
location;
(4) the ease with which the defendant's
whereabouts could have been ascertained;
(5) actual knowledge on the part of the defendant
of the pendency of the action;
(6) special circumstances which would affect the
plaintiff's efforts; and
(7) actual service on the defendant.
In the case sub judice, the trial judge made specific
findings with respect to each of the aforementioned factors.
Regarding the first two factors, the trial court found that
plaintiff made virtually no attempt to serve defendants until
nearly five months after the expiration of the two-year statute
of limitations. The trial court was unpersuaded by plaintiff's
argument that it, nonetheless, began to prepare the summonses for
service sometime after the new year and that its efforts were
hampered by the unexpected dismissal for want of prosecution.
Similarly, the trial court's findings with respect to the
third and fourth Segal factors militated in favor of defendants.
Plaintiff argues that it had special difficulty in locating
defendants due to the disbanding of the Malk & Harris law
partnership. The evidence revealed, however, that both Charles
Malk and Steven Harris were, at all times, practicing attorneys
who were registered with the Attorney Registration and
Disciplinary Commission of the Supreme Court of Illinois, listed
in numerous law directories, and who maintained the same offices
and addresses following the dissolution of their partnership.
Significantly, the trial court noted that plaintiff made no
attempt to make an evidentiary showing that the dissolution of
Malk & Harris impinged upon its efforts to serve any summons.
Indeed, we find it disingenuous for plaintiff to argue, on one
hand, that its efforts to serve defendants were impeded when Malk
& Harris dissolved, yet argue, on the other hand, that it
continually kept Malk & Harris abreast of its ongoing litigation.
Despite plaintiff's contention that defendants had notice of
plaintiff's malpractice action by virtue of a letter dated June
23, 1993, warning defendants that plaintiff might seek damages
from them, the trial court found that the fifth Segal factor
weighed in defendants' favor due to lack of evidence that
defendants had knowledge of the malpractice action prior to the
date of service. We agree. In our view, the cautionary letter
relied upon by plaintiff, as well as defendants' intermittent
assistance in plaintiff's response to the motion to dismiss its
mechanics lien action, did not establish that defendants had
knowledge of the filing of plaintiff's malpractice complaint
before receiving actual service on April 10, 1996.
As to the sixth factor, the trial court found that no
special circumstances existed to justify plaintiff's delay in
effectuating service of process. The trial court noted that the
only item of record at the time the Rule 103(b) motion to dismiss
was decided was plaintiff's assertion that it intentionally
delayed in filing suit at the request of an attorney at Malk &
Harris. Importantly, in granting defendants' motion to dismiss
plaintiff's malpractice claim, the court made the following
finding:
"No claim is made that [plaintiff] delayed
effecting service of summons at the request of any
defendant representative, nor is *** any satisfactory
explanation made as to why, having decided to file
suit, *** plaintiff decided that the fact of the filing
could be kept from the defendants being sued by
intentionally delaying issuance of summons." (Emphasis
added.)
Finally, although plaintiff eventually obtained actual
service upon certain defendants, it occurred nearly five months
after the expiration of the statute of limitations. Importantly,
plaintiff never caused summons to issue to defendants Steven M.
Harris, Ltd., and Malk & Harris. Indeed, the trial court noted
that the record was replete with evidence that plaintiff failed
to exercise reasonable diligence. In brief, it was shown that
plaintiff intentionally chose not to cause summons to issue,
caused its case to be dismissed for want of prosecution, delayed
in moving to vacate that dismissal, and again delayed nearly one
entire month before causing summons to issue after its case was
reinstated.
Although all parties in the instant case cite Segal, 136 Ill. 2d 282, as supportive of their respective contentions, in
our view, the trial court did not abuse its discretion by
dismissing plaintiff's claim. Significantly, in Segal, the
Illinois Supreme Court wrote, in pertinent part:
"The purpose of Rule 103(b) is to protect
defendants from unnecessary delay in the service of
process on them and to prevent the circumvention of the
statute of limitations." Segal, 136 Ill. 2d at 286,
citing Hanna v. Kelly, 91 Ill. App. 3d 896, 900, 414 N.E.2d 1262, 1266 (1980), and Galvan v. Morales, 9 Ill.
App. 3d 255, 258, 292 N.E.2d 36, 38 (1972).
In our view, plaintiff's conduct in the case sub judice, in
effect, extended the statute of limitations and thereby abridged
Rule 103(b).
Importantly, in Segal, the supreme court stated:
"It has long been noted that '[p]revention of
intentional delay in the service of summons which would
postpone service for an indefinite time after a
statutory period of limitations has run, was a primary
reason for the passage of Supreme Court Rule 103(b) and
its predecessors.' " (Emphasis added.) Segal, 136 Ill. 2d at 286, quoting Karpiel v. LaSalle National Bank,
119 Ill. App. 2d 157, 160, 255 N.E.2d 61, 63 (1970),
and citing Meyer v. Wardrop, 37 Ill. App. 3d 243, 345 N.E.2d 762 (1976).
In the instant case, the trial court made a specific finding that
plaintiff intentionally delayed the issuance of summons. While
plaintiff posits that the facts of the instant case cannot be
distinguished from the facts in Segal, we disagree. In Segal,
the supreme court wrote that "the reason given by plaintiff for
failure to place the summonses for service for 19 weeks after the
filing of his complaint was that plaintiff inadvertently forgot
to do so." Segal, 136 Ill. 2d at 287. In our view, we cannot say
that the same rationale that was applied by the supreme court in
deciding Segal, where the court stated that the plaintiff
inadvertently forgot to place summons, controls the determination
of dismissal of plaintiff's complaint in the instant case, where
plaintiff intentionally failed to place summons.
Plaintiff, nevertheless, cites as dispositive the following
language in Segal:
"In this case, because the length of the delay in
the service of process was such that the purpose of
Rule 103(b) would not be served by dismissing
plaintiff's action, the allowance of defendants' Rule
103(b) motion by the circuit court was an abuse of
discretion. It would not be an abuse of discretion for
a circuit court to allow a dismissal with prejudice
under Rule 103(b) for a delay equal to or shorter than
the delay present in this case if the delay occurs
under circumstances which serve to deny the defendants
a 'fair opportunity to investigate the circumstances
upon which liability against [the defendants] is
predicated while the facts are accessible.' " Segal,
136 Ill. 2d at 289, quoting Geneva Construction Co. v.
Martin Transfer & Storage Co., 4 Ill. 2d 273, 289-90
(1954).
Plaintiff's contention, however, ignores the previously mentioned
policy considerations underlying Supreme Court Rule 103(b) that
Segal and other cases have deemed instructive. In the present
case, we believe that the trial court's dismissal of plaintiff's
claim served the purpose of Rule 103(b) by recognizing that
plaintiff's intentional five-month delay in service improperly
protracted the applicable statute of limitations. See Womick v.
Jackson County Nursing Home, 137 Ill. 2d 371 (1990) (trial court
properly considered only plaintiff's diligence in serving process
and properly ruled that plaintiff did not act with reasonable
diligence in waiting several months (after filing suit two days
before expiration of limitations period) to serve defendant,
despite defendant's actual knowledge of pendency of suit, where
defendant's whereabouts were known and it was easily served);
Tischer v. Jordan, 269 Ill. App. 3d 301, 645 N.E.2d 991 (1995)
(case properly dismissed pursuant to Rule 103(b) where
plaintiff's case was previously dismissed for want of
prosecution, evidence showed repeated inaction by plaintiff, and
plaintiff waited to effectuate service nearly six months after
refiling complaint); Paglis v. Black, 178 Ill. App. 3d 1062, 534 N.E.2d 206 (1989) (delay of more than five months in obtaining
service upon defendants in malpractice action, despite
plaintiffs' knowledge of defendants' whereabouts, warranted Rule
103(b) dismissal); Penrod v. Sears, Roebuck & Co., 150 Ill. App.
3d 125, 501 N.E.2d 367 (1986) (cause properly dismissed where
plaintiff made only minimal efforts to obtain service over a
period of seven months); Gatto v. Nelson, 142 Ill. App. 3d 284,
492 N.E.2d 1 (1986). Moreover, in the case at bar, the trial
court considered the seven-factor test outlined in Segal, and the
specific findings made by the trial court dictated the dismissal
of plaintiff's claim in the instant case.
Our review of the record on appeal leads us to agree with
the trial court that plaintiff failed to meet its burden of
demonstrating reasonable diligence in attempting to obtain timely
service upon defendants. Accordingly, we hold that the trial
court did not abuse its discretion in dismissing plaintiff's
claim due to lack of diligence.
Lastly, plaintiff contends that the trial court erred in its
ruling that plaintiff's waiver argument was insufficient.
Specifically, plaintiff argues that defendants waived their right
to assert a Rule 103(b) defense by failing to properly interpose
their objections and, instead, defending the merits of the
malpractice action.
Plaintiff correctly states the general rule that a party
must interpose an objection in a timely manner and prior to
defending a suit on its merits. Cannon v. Dini, 226 Ill. App. 3d
82, 84-85, 589 N.E.2d 653, 655 (1992). Nevertheless, we find
plaintiff's waiver argument lacking in merit. Our review of the
record reveals that, following the filing of plaintiff's third
amended complaint, defendants did not answer the complaint but,
instead, filed their Rule 103(b) motions to dismiss. Defendants
did not engage in any discovery, and attorney Malk's motion to
dismiss plaintiff's complaint was brought pursuant to section 2-
615 of the Illinois Code of Civil Procedure--a motion that is
never considered a defense on the merits. 735 ILCS 5/2-615 (West
1996); see O'Hara v. State Farm Mutual Automobile Insurance Co.,
137 Ill. App. 3d 131, 134, 484 N.E.2d 834, 836-37 (1985).
Indeed, plaintiff fails to cite a single case that supports its
position that defendants' actions prior to the filing of their
Rule 103(b) motions to dismiss constituted defenses on the
merits.
Accordingly, the decision of the circuit court is affirmed.
Affirmed.
McNULTY, P.J., and RAKOWSKI, J., concur.
[fn1] Malk & Harris was a partnership between the two
professional corporations, Charles R. Malk & Associates, Ltd.,
and Steven M. Harris, Ltd., both of which have been named in the
instant malpractice suit. In addition, Charles R. Malk, Steven
M. Harris, and Steven W. Workman, an associate of Malk & Harris,
have been named in their individual capacities.