Storm & Associates v. Cuculich
Annotate this Case
FIFTH DIVISION
FILED: 8/28/98
No. 1-98-0841
STORM & ASSOCIATES, LTD., ) APPEAL FROM THE
) CIRCUIT COURT OF
Plaintiff-Appellant, ) COOK COUNTY
)
v )
)
DONALD CUCULICH, NANCY CUCULICH, )
MARSHALL PATNER and MARSHALL PATNER & )
ASSOCIATES, P.C., an Illinois )
professional corporation, ) HONORABLE
) GEORGE TIMBERLAKE,
Defendants-Appellees. ) JUDGE PRESIDING.
PRESIDING JUSTICE HOFFMAN delivered the opinion of the court:
The plaintiff, Storm & Associates, Ltd. (Storm), appeals from
an order of the circuit court dismissing its four count amended
complaint. For the reasons which follow, we affirm the dismissal
of count II, reverse the dismissal of counts I, III and IV, and
remand this cause to the circuit court with directions and for
further proceedings consistent with this opinion.
From the allegations contained in Storm's amended complaint
(complaint), it appears that the defendants, Donald and Nancy
Cuculich, were the named plaintiffs in a class action suit pending
in the circuit court of Cook County (hereinafter referred to as the
"Class Action"), and were being represented in that action by
Marshall Patner (Patner) and Marshall Patner & Associates, P.C.
(collectively referred to as "the Patner Defendants"). While the
Class Action was pending and after the class had been certified,
Patner retained Storm to act as co-counsel. Storm accepted the
engagement on a contingent fee basis which was memorialized in a
letter. Thereafter, Storm filed its appearance as additional
counsel for the Cuculichs.
Storm alleges that it performed legal services on behalf of
the Cuculichs at Patner's direction prior to its engagement as co-
counsel being terminated "without cause." After the defendants
refused to compensate Storm for the legal services it rendered as
co-counsel in the Class Action, Storm instituted the instant
action.
Count I of Storm's complaint is a quantum meruit claim against
the Cuculichs for the value of the legal services it rendered and
expenses it incurred as co-counsel in the Class Action. This count
is premised upon the allegation that Patner acted as the Cuculichs'
agent in both retaining and terminating Storm. Count II of the
complaint asserts a claim against the Patner Defendants for breach
of an agreement in which they allegedly guaranteed payment of
Storm's fees. In support of this count, Storm attached to the
complaint a copy of a handwritten note which is signed by Patner
and which provides in relevant part: "As I said in my phone
message, I will protect your hours. But you did not include them
with your letter; will you please do so, at your convenience."
Count III purports to state a claim for tortious interference
with contract against the Patner Defendants, alleging that they
"intentionally and with malice caused or induced" the Cuculichs to
terminate Storm "without cause or justification." In count IV of
its complaint, pled in the alternative to counts I, II and III,
Storm asserts a quantum meruit claim against the Patner Defendants
for the value of the legal services it rendered and the expenses it
incurred as co-counsel in the Class Action.
The defendants responded to Storm's complaint with a combined
motion to dismiss pursuant to section 2-619.1 of the Code of Civil
Procedure (Code) (735 ILCS 5/2-619.1 (West 1996)). As to counts I
and IV, the defendants argued that: 1) the services Storm rendered
did not confer any benefit upon the defendants individually, and 2)
Storm was not yet entitled to recover any attorney's fees because
the Class Action was still pending and no fund had been created
from which those fees could be paid. As to count II, the Patner
Defendants claimed that: 1) the action was barred by the provisions
of section 1 of the Frauds Act (740 ILCS 80/1 (West 1996)), and 2)
the writing upon which Storm relied was not a guaranty as it
contained no promise to pay any debt or obligation owed by the
Cuculichs. In support of the dismissal of count III, the
defendants argued that "[a]n agent is not liable for wrongfully
interfering with its principal's contract since the acts of the
agent are imputed to the principal."
In its memorandum in opposition to the defendants' motion to
dismiss, Storm addressed the merits of the motion as it related to
counts I, II and IV of the complaint. Storm argued that dismissal
of count III was premature prior to discovery and objected to the
defendants' failure to specify whether they sought dismissal of
counts I, II and IV under section 2-615 (735 ILCS 5/2-615 (West
1996)) or section 2-619 (735 ILCS 5/2-619 (West 1996)) of the Code.
The trial court entered a "Final Judgment Order," granting the
defendants' motion to dismiss. Thereafter, Storm filed a timely
notice of appeal, invoking our jurisdiction under Supreme Court
Rule 301 (155 Ill. 2d R. 301).
Section 2-619.1 of the Code is a procedural statute which
allows a litigant to combine a section 2-615 motion to dismiss and
a section 2-619 motion for involuntary dismissal in one pleading.
735 ILCS 5/2-619.1 (West 1996). However, this statute is not a
legislative authorization for hybrid motion practice. Section 2-
619.1 specifically provides that a combined motion shall be divided
into parts and each part shall be limited to and specify a single
section of the Code under which relief is sought. 735 ILCS 5/2-
619.1 (West 1996). Meticulous practice dictates that the movants
clearly state the section of the Code under which a motion to
dismiss is brought. Illinois Graphics Co. v. Nickum, 159 Ill. 2d 469, 484, 639 N.E.2d 1282 (1994).
Other than in part III of their motion, which is directed to
count III of Storm's complaint, the defendants here failed to
specify whether they sought relief under section 2-615 or section
2-619 of the Code. While failure to properly label a motion to
dismiss is not a pleading practice which should be encouraged,
reversal for such a deficiency is appropriate only when prejudice
to the nonmovant results. Illinois Graphics Co., 159 Ill. 2d at
484. In reviewing the propriety of a dismissal resulting from an
undesignated motion, we will examine the grounds for the motion,
the relief requested and the treatment of the motion below to
determine whether the motion is properly classified as one brought
under section 2-615 or section 2-619. Illinois Graphics Co., 159 Ill. 2d at 484. Where, as in this case, the trial court fails to
specify the grounds upon which it relied in granting a motion to
dismiss, we will presume it was upon one of the grounds urged by
the defendant. Zielinski v. Miller, 277 Ill. App. 3d 735, 739, 660 N.E.2d 1289 (1995).
A section 2-615 motion attacks the sufficiency of a complaint
and raises the question of whether it states a cause of action upon
which relief can be granted. Burdinie v. Village of Glendale
Heights, 139 Ill. 2d 501, 505, 565 N.E.2d 654 (1990); Janes v.
First Federal Savings & Loan Ass'n, 57 Ill. 2d 398, 406, 312 N.E.2d 605 (1974). When ruling on a section 2-615 motion, the court may
only consider the facts apparent from the face of the complaint,
matters of which the court may take judicial notice, and judicial
admissions in the record. Mt. Zion State Bank & Trust v.
Consolidated Communications, Inc., 169 Ill. 2d 110, 115, 660 N.E.2d 863 (1995).
A section 2-619 motion raises certain defects or defenses and
poses the question of whether the defendant is entitled to judgment
as a matter of law. Illinois Graphics Co., 159 Ill. 2d at 485,
494. If the grounds for such a motion do not appear on the face of
the complaint, the motion must be supported by affidavit. 735 ILCS
5/2-619(a) (West 1996). When, however, the only grounds for a
section 2-619 motion appear on the face of the complaint, the
motion falls "within the area of confluence" between section 2-615
and section 2-619 (Illinois Graphics Co., 159 Ill. 2d at 486), and
the appropriate method for reaching the defect is a section 2-615
motion (Rowan v. Novotny, 157 Ill. App. 3d 691, 693-94, 510 N.E.2d 1111 (1987); Ill. Ann. Stat., ch. 110, par. 2-619, Historical &
Practice Notes, at 662 (Smith-Hurd 1983)).
In this case, the defendants supported their combined motion
with an affidavit attesting to matters of record in the Class
Action. However, we deem that affidavit to be surplusage as
everything contained therein is the proper subject of judicial
notice. See People v. Jackson, 182 Ill. 2d 30, 66, 695 N.E.2d 391
(1998).
In ruling on a motion to dismiss under either section 2-615 or
section 2-619 of the Code, the court must accept all well-pled
facts in the complaint as true and draw all reasonable inferences
from those facts in favor of the plaintiff. See Miner v. Gillette
Co., 87 Ill. 2d 7, 19, 428 N.E.2d 478 (1981); Your Style
Publications, Inc. v. Mid Town Bank & Trust Co., 150 Ill. App. 3d
421, 424, 501 N.E.2d 805 (1986); Holubek v. City of Chicago, 146
Ill. App. 3d 815, 817, 497 N.E.2d 348 (1986). Because the
resolution of either motion involves only a question of law, our
review is de novo. Stephen L. Winternitz, Inc. v. National Bank of
Monmouth, 289 Ill. App. 3d 753, 755, 683 N.E.2d 492 (1997).
Further, since, in support of their motion to dismiss counts I, II
and IV, the defendants relied on nothing other than the facts
alleged in Storm's complaint and matters of which judicial notice
can be taken, we find that Storm suffered no prejudice by reason of
the defendants' failure to properly designate the section of the
Code under which the dismissal of these counts was sought.
Consequently, we will address the merits of the trial court's
dismissal of each count of Storm's complaint.
The Cuculichs sought dismissal of the quantum meruit claim
asserted against them in count I on the basis that Storm had
conferred no benefit upon them individually and that its right to
fees, if any, was contingent upon the ultimate success of the Class
Action and the creation of a fund for payment of attorney's fees.
Storm argues that its right to seek recovery for the reasonable
value of its legal services accrued immediately upon its discharge
as co-counsel. Central to our resolution of this issue is the
applicability of the holding in In re Estate of Callahan, 144 Ill. 2d 32, 578 N.E.2d 985 (1991), to the rights of a discharged
attorney originally engaged to represent the plaintiffs in a class
action suit.
In Callahan, our supreme court held that a cause of action for
quantum meruit fees accrues in favor of an attorney engaged to
represent a client on a contingent fee basis immediately upon
discharge and prior to the resolution of the client's lawsuit.
Callahan, 144 Ill. 2d at 37-42. The defendants argue that, while
this rule is applicable to the circumstance where a single client
discharges an attorney retained on a contingent fee basis, it has
no application to the rights of a discharged attorney retained to
represent members of a class. They contend that Illinois adheres
to the "common fund doctrine," under which an attorney's right to
fees in a class action is contingent upon the ultimate success of
the litigation and the creation of a fund from which those fees can
be paid. See Fiorito v. Jones, 72 Ill. 2d 73, 377 N.E.2d 1019
(1978); Hamer v. Kirk, 64 Ill. 2d 434, 356 N.E.2d 524 (1976). The
defendants reason that, since class action suits are maintained for
the benefit of all class members, the costs of litigation should be
paid from the common fund so as to spread them proportionately
among those who benefit from the litigation.
The defendants are correct in their assertion that Illinois
adheres to the "common fund doctrine." However, we believe their
reliance upon that doctrine is misplaced under the circumstances of
the instant case.
Our supreme court analyzed the "common fund doctrine" and
revisited its origin and the rationale behind its application in
Brundidge v. Glendale Federal Bank, F.S.B., 168 Ill. 2d 235, 238,
659 N.E.2d 909 (1995), explaining that:
"Illinois has long adhered to the general American
rule that the prevailing party in a lawsuit must bear the
costs of litigation, unless a statutory provision or an
agreement between the parties allows the successful
litigant to recover attorney fees and the expenses of
suit. [Citations.] However, where the outcome of the
litigation has created a common fund, this court has
adopted the 'common fund doctrine.' [Citations.] The
common fund doctrine allows one who 'creates, preserves,
or increases the value of a fund in which others have an
ownership interest to be reimbursed from that fund for
litigation expenses incurred, including counsel fees.'
[Citations.] The doctrine finds its source in the
court's inherent equitable powers [citation] and is
founded on the rationale that successful litigants would
be unjustly enriched if their attorneys were not
compensated from the common fund created for the
litigants' benefit [citation]. By awarding fees payable
from the common fund created for the benefit of the
entire class, the court spreads the costs of litigation
proportionately among those who will benefit from the
fund. [Citations.]"
There is no doubt that, as the defendants argue, a number of
reported cases have denied claims for the payment of attorney's
fees incurred on behalf of successful litigants in class action
suits due to the absence of a common fund from which those fees
could be paid. See Hamer, 64 Ill. 2d at 440-41; Client Follow-Up
Co. v. Hynes, 105 Ill. App. 3d 619, 628-29, 434 N.E.2d 485 (1982).
The defendants also correctly quote the court in Fiorito v. Jones,
72 Ill. 2d 73, 87, 377 N.E.2d 1019 (1978), when they argue that,
"in a class action, the right to attorneys' fees is contingent upon
ultimate success and upon the presence of a fund from which fees
can be paid." However, a closer examination of these cases reveals
that they involve: 1) a request for an award of fees against
either the defendants or the class members when, although the
plaintiffs were successful in their class action, no fund had been
"brought into court" (Hamer, 64 Ill. 2d at 440-41; Client Follow-up
Co., 105 Ill. App. 3d at 629; see also Hoffman v. Lehnhausen, 48 Ill. 2d 323, 329, 269 N.E.2d 465 (1971)); or 2) an analysis of the
various factors to be used by a court in determining the amount of
reasonable fees it will order to be paid from the common fund
created for the benefit of the entire class (Fiorito, 72 Ill. 2d at
87-94). These cases do not address the rights of a discharged
attorney as against the individual class representative who engaged
him. To be sure, a class action is not "the usual contingent fee
case." Flynn v. Kucharski, 59 Ill. 2d 61, 66, 319 N.E.2d 1 (1974).
It is distinguished by the fact that the neither the attorney-
client relationship nor the attorney's fee is the result of a
voluntary agreement between the attorney and the class members as
a group. However, the same cannot be said of the relationship
between the attorney and the class representative. While it is
true that the attorney's fee in a class action suit is set by the
court, the attorney-client relationship between the attorney and
the class representative is purely voluntary.
The rationale underlying the holding in Callahan is no less
compelling when, as in this case, the discharged attorney was
engaged on a contingent fee basis to represent the plaintiffs in a
class action suit. Once the class representative discharges the
attorney, the contract governing their relationship ceases to exist
and the contingency term is no longer operative. Additionally, the
value of the attorney's services rendered prior to discharge cannot
be measured by the results obtained by another attorney, nor can
the attorney's right to compensation for those services be made
contingent upon the success or failure of another attorney. See
Callahan, 144 Ill. 2d at 39-41. Recognition of a cause of action
for quantum meruit fees in favor of a discharged attorney against
the individual class representative that retained the attorney's
services in a class action suit is nothing more than an
acknowledgement of the implied promise of a recipient of services
to pay for those services which are of value to him. See Callahan,
144 Ill. 2d at 40. The question of whether the class
representative derived a benefit from the services rendered by the
discharged attorney during the attorney's period of employment is
a factor to be considered in measuring the reasonable value of
those services. See Callahan, 144 Ill. 2d at 41. That question is
one of fact and is, therefore, inappropriate for resolution on a
motion to dismiss.
In accord with our recent decision in Much, Shelist, Freed,
Denenberg and Ament, P.C. v. Lison, ___ Ill. App. 3d ___, 696 N.E.2d 1196 (1998), we reject the defendants' arguments and find
that count I of Storm's complaint states a cause of action against
the Cuculichs for quantum meruit fees. Consequently, we reverse
the trial court's dismissal of count I.
Next, we address the propriety of the trial court's dismissal
of count II of Storm's complaint, which alleges a cause of action
against the Patner Defendants for breach of a guaranty agreement.
The Patner Defendants argued that count II must be dismissed
because any contract to answer for the debt of another must be in
writing pursuant to section 1 of the Frauds Act (740 ILCS 80/1
(West 1996)). They pointed out that the writing upon which Storm
relied contained only a promise to "protect [Storm's] hours," but
failed to contain either a promise to pay a debt or obligation owed
by the Cuculichs or the terms and conditions of the undertaking.
We agree.
If, as Storm alleges, the Patner Defendants agreed to
guarantee payment of its fees and become liable for the payment of
those fees in the event that the Cuculichs failed to pay, the
agreement is one to answer for the debt of another. Section 1 of
the Frauds Act bars any action upon such an undertaking "unless the
promise or agreement upon which such action shall be brought, or
some memorandum or note thereof, shall be in writing, and signed by
the party to be charged therewith, or some other person thereunto
by him lawfully authorized." 740 ILCS 80/1 (West 1996). The issue
then becomes whether the writing upon which Storm relies is
sufficient to satisfy the requirements of the statute.
A writing relied upon to satisfy the requirements of the
Frauds Act must itself show the existence of a contract and its
terms and conditions. Culbertson v. Carruthers, 66 Ill. App. 3d
47, 54, 383 N.E.2d 618 (1978). Even if the Patner Defendants'
agreement to "protect" Storm's "hours" could reasonably be
interpreted as an undertaking to guarantee payment of its fees, the
writing does not identify the fees referred to, specify the amount
guaranteed or the method by which that sum would be determined, or
set forth the event which would trigger an obligation to pay. We
find that the writing attached to count II of Storm's complaint
fails to satisfy the requirements of section 1 of the Frauds Act
(see Chapman v. Freeport Securities Co., 174 Ill. App. 3d 847, 854-
55, 529 N.E.2d 6 (1988)), and, therefore, affirm the trial court's
dismissal of count II.
The Patner Defendants sought dismissal of count III, in which
Storm asserted a claim for tortious interference with contract
against them, pursuant to section 2-615 of the Code. Their only
argument before the trial court in support of their motion to
dismiss that count was their contention that "[a]n agent is not
liable for wrongfully interfering with its principal's contract
since the acts of the agent are imputed to the principal." In
response, Storm argued that the count should not be dismissed
before discovery as "a jury may find that Patner was not acting as
agent for the Cuculichs at the time plaintiff was discharged."
At the outset, we reject Storm's argument that the defendants'
section 2-615 motion to dismiss count III was premature before
discovery. The question of whether a complaint states a cause of
action is determined based on the facts alleged therein and the
reasonable inferences favorable to the plaintiff which can be drawn
from those facts. Geick v. Kay, 236 Ill. App. 3d 868, 873, 603 N.E.2d 121 (1992). The question is one of law, not fact. Either
the complaint contains factual allegations in support of each
element of the claim that the plaintiff must prove in order to
sustain a judgment, or it does not. Schuler v. Abbott Labora-
tories, 265 Ill. App. 3d 991, 994, 639 N.E.2d 144 (1993). The
notion that plaintiffs are permitted to plead an action against a
defendant before they are possessed of sufficient information to
satisfy each element of the claim runs counter to Supreme Court
Rule 137, which requires that all pleadings be well grounded in
fact to the best of the pleader's knowledge, information and belief
after reasonable inquiry. 155 Ill. 2d R. 137.
We also reject the argument upon which the Patner Defendants
premised their motion to dismiss count III. The proposition that
an agent can never be held liable for wrongfully interfering with
his principal's contracts is far too broad. Even in circumstances
where an agent is cloaked with a qualified privilege, a claim for
tortious interference may lie where the agent's actions in
interfering with the principal's contract are unjustified or
malicious, such as where the agent's conduct is totally unrelated
or antagonistic to the principal's interests. HPI Health Care
Services, Inc. v. Mt. Vernon Hospital, Inc., 131 Ill. 2d 145, 156-
59, 545 N.E.2d 672 (1989).
Although we have rejected the broad proposition upon which the
Patner Defendants sought dismissal of count III, we believe that
further analysis of the count is necessary. Count III of Storm's
complaint is captioned "Interference with Contractual Relations."
An action for tortious interference with a contract which is
terminable at will, however, is classified as one for intentional
interference with prospective economic advantage. Anderson v.
Anchor Organization for Health Maintenance, 274 Ill. App. 3d 1001,
1013, 654 N.E.2d 675 (1995). Since the attorney-client
relationship is terminable at will (LaRocco v. Bakwin, 108 Ill.
App. 3d 723, 727-28, 439 N.E.2d 537 (1982)), the claim asserted in
count III of Storm's complaint is more properly classified as one
for intentional interference with prospective economic advantage
(Anderson, 274 Ill. App. 3d at 1013).
Count III of Storm's complaint alleges that, at all times
relevant, the Patner Defendants acted as counsel for the Cuculichs
in the Class Action. The existence of an attorney's fiduciary
relationship with his client gives rise to a qualified privilege in
favor of the attorney to advise the client without fear of personal
liability to third persons if that advice later proves to be
incorrect. Salaymeh v. Interqual, Inc., 155 Ill. App. 3d 1040,
1045, 508 N.E.2d 1155 (1987). When, as in this case, the existence
of a privilege in favor of the defendant is apparent on the face of
a claim for tortious interference with prospective economic
advantage, it is the plaintiff's burden to plead and prove that the
defendant's conduct was unjustified or malicious. Fellhauer v.
City of Geneva, 142 Ill. 2d 495, 512, 568 N.E.2d 870 (1991).
Storm alleged that the Patner Defendants "intentionally and
with malice caused or induced" the Cuculichs to terminate Storm
"without cause or justification." A complaint, however, may not
rest on mere unsupported factual conclusions. J. Eck & Sons, Inc.
v. Reuben H. Donnelley Corp., 213 Ill. App. 3d 510, 515, 572 N.E.2d 1090 (1991). Illinois is a fact pleading jurisdiction. Knox
College v. Celotex Corp., 88 Ill. 2d 407, 426-27, 430 N.E.2d 976
(1981). Conclusions of fact will not suffice to state a cause of
action regardless of whether they generally inform the defendant of
the nature of the claim against him. Adkins v. Sarah Bush Lincoln
Health Center, 129 Ill. 2d 497, 519-20, 544 N.E.2d 733 (1989).
Storm's conclusory allegations standing alone are insufficient
to satisfy its burden to set forth factual allegations from which
it could be reasonably inferred that the conduct of the Patner
Defendants in inducing the Cuculichs to discharge Storm was
unjustified or malicious. HPI Health Care, 131 Ill. 2d at 158.
The bare conclusions that the Patner Defendants acted inten-
tionally, maliciously, and without cause or justification are
insufficient to negate the protection of the privilege arising by
reason of the attorney-client relationship here. Philip I. Mappa
Interests, Ltd. v. Kendle, 196 Ill. App. 3d 703, 708-09, 554 N.E.2d 1008 (1990). Consequently, we find that count III of Storm's com-
plaint fails to state a cause of action.
Although, we may affirm the dismissal of a complaint on any
ground apparent from the record, even one not relied upon by the
trial court (Material Service Corp. v. Department of Revenue, 98 Ill. 2d 382, 387, 457 N.E.2d 9 (1983)), we decline to affirm the
dismissal of count III on the ground that it fails to state a cause
of action. It would be inappropriate for us to do so because that
deficiency was not addressed by the parties either before the trial
court or this court and because it may be correctable by amendment.
Geaslen v. Berkson, Gorov & Levin, Ltd., 155 Ill. 2d 223, 230-31,
613 N.E.2d 702 (1993); Keating v. Estate of Golding, 277 Ill. App.
3d 953, 957-58, 661 N.E.2d 541 (1996)). Having determined that the
Patner Defendants were not entitled to a dismissal of count III
based on the arguments set forth in their motion to dismiss, we
reverse the trial court's dismissal of that count. However,
because we find the complaint to be factually deficient as
discussed above, we instruct the trial court on remand to strike
count III and afford Storm a reasonable opportunity to amend it.
Lastly, we will address the dismissal of count IV of Storm's
complaint, in which it asserted a quantum meruit claim against the
Patner Defendants. The Patner Defendants sought dismissal of count
IV on the same grounds argued by the Cuculichs in support of
dismissal of the quantum meruit claim asserted against them in
count I. Consequently, for the same reasons stated in support of
our reversal of the dismissal of count I, we also reverse the
dismissal of count IV. As was the case with count III, however, we
have also identified a serious pleading deficiency in count IV
which merits further analysis.
It has been long settled in Illinois that, when an agent
entering into a contract with another discloses both his agency
status and the name of his principal or when the party dealing with
the agent knows that the agent is acting for his principal in
making a contract, the agent is not liable on the contract unless
he agrees to become personally liable. Chicago Title & Trust Co.
v. De Lasaux, 336 Ill. 522, 526, 168 N.E. 640 (1929). As the court
observed in Clark v. Maddux, 118 Ill. App. 3d 546, 548-49, 454 N.E.2d 1179 (1983), this rule has been applied in a number of cases
involving attorneys. See Petrando v. Barry, 4 Ill. App. 2d 319,
322-23, 124 N.E.2d 85 (1955); International Service Corp. v. Ooms,
105 Ill. App. 2d 391, 395-96, 245 N.E.2d 571 (1969); McCorkle v.
Weinstein, 50 Ill. App. 3d 661, 663-64, 365 N.E.2d 953 (1977);
Associated Claims Service, Inc. v. Rinella & Rinella, 79 Ill. App.
3d 1023, 1027-28, 398 N.E.2d 1211 (1979).
The factual allegations in Count IV of Storm's complaint
establish it was aware that the Patner Defendants were serving as
counsel for the Cuculichs when they retained Storm to act as co-
counsel. Therefore, it is clear that Storm knew of the Cuculichs'
identity and the Patner Defendants' status as their attorneys at
the time it agreed to serve as co-counsel. Further, count IV
contains no allegations which indicate that the Patner Defendants
agreed or intended to become personally liable for the payment of
Storm's fees. Although we find that count IV fails to state a
cause of action against the Patner Defendants, we decline to affirm
its dismissal for the same reasons that we declined to affirm the
dismissal of count III. We reverse the trial court's dismissal of
count IV but direct the trial court on remand to also strike count
IV and afford Storm a reasonable opportunity to amend it.
In summary, we reverse the trial court's dismissal of counts
I, III and IV of Storm's amended complaint, affirm its dismissal of
count II, and remand this action to the circuit court with
instructions to strike counts III and IV and afford Storm a
reasonable opportunity to amend those counts and for further
proceedings consistent with this opinion.
Affirmed in part, reversed in part and remanded with
directions.
THEIS and HOURIHANE, JJ., concur.
FILED: 8/28/98
No. 1-98-0841
STORM & ASSOCIATES, LTD., ) APPEAL FROM THE
) CIRCUIT COURT OF
Plaintiff-Appellant, ) COOK COUNTY
)
v )
)
DONALD CUCULICH, NANCY CUCULICH, )
MARSHALL PATNER and MARSHALL PATNER & )
ASSOCIATES, P.C., an Illinois )
professional corporation, ) HONORABLE
) GEORGE TIMBERLAKE,
Defendants-Appellees. ) JUDGE PRESIDING.
PRESIDING JUSTICE HOFFMAN delivered the opinion of the court:
The plaintiff, Storm & Associates, Ltd. (Storm), appeals from
an order of the circuit court dismissing its four count amended
complaint. For the reasons which follow, we affirm the dismissal
of count II, reverse the dismissal of counts I, III and IV, and
remand this cause to the circuit court with directions and for
further proceedings consistent with this opinion.
From the allegations contained in Storm's amended complaint
(complaint), it appears that the defendants, Donald and Nancy
Cuculich, were the named plaintiffs in a class action suit pending
in the circuit court of Cook County (hereinafter referred to as the
"Class Action"), and were being represented in that action by
Marshall Patner (Patner) and Marshall Patner & Associates, P.C.
(collectively referred to as "the Patner Defendants"). While the
Class Action was pending and after the class had been certified,
Patner retained Storm to act as co-counsel. Storm accepted the
engagement on a contingent fee basis which was memorialized in a
letter. Thereafter, Storm filed its appearance as additional
counsel for the Cuculichs.
Storm alleges that it performed legal services on behalf of
the Cuculichs at Patner's direction prior to its engagement as co-
counsel being terminated "without cause." After the defendants
refused to compensate Storm for the legal services it rendered as
co-counsel in the Class Action, Storm instituted the instant
action.
Count I of Storm's complaint is a quantum meruit claim against
the Cuculichs for the value of the legal services it rendered and
expenses it incurred as co-counsel in the Class Action. This count
is premised upon the allegation that Patner acted as the Cuculichs'
agent in both retaining and terminating Storm. Count II of the
complaint asserts a claim against the Patner Defendants for breach
of an agreement in which they allegedly guaranteed payment of
Storm's fees. In support of this count, Storm attached to the
complaint a copy of a handwritten note which is signed by Patner
and which provides in relevant part: "As I said in my phone
message, I will protect your hours. But you did not include them
with your letter; will you please do so, at your convenience."
Count III purports to state a claim for tortious interference
with contract against the Patner Defendants, alleging that they
"intentionally and with malice caused or induced" the Cuculichs to
terminate Storm "without cause or justification." In count IV of
its complaint, pled in the alternative to counts I, II and III,
Storm asserts a quantum meruit claim against the Patner Defendants
for the value of the legal services it rendered and the expenses it
incurred as co-counsel in the Class Action.
The defendants responded to Storm's complaint with a combined
motion to dismiss pursuant to section 2-619.1 of the Code of Civil
Procedure (Code) (735 ILCS 5/2-619.1 (West 1996)). As to counts I
and IV, the defendants argued that: 1) the services Storm rendered
did not confer any benefit upon the defendants individually, and 2)
Storm was not yet entitled to recover any attorney's fees because
the Class Action was still pending and no fund had been created
from which those fees could be paid. As to count II, the Patner
Defendants claimed that: 1) the action was barred by the provisions
of section 1 of the Frauds Act (740 ILCS 80/1 (West 1996)), and 2)
the writing upon which Storm relied was not a guaranty as it
contained no promise to pay any debt or obligation owed by the
Cuculichs. In support of the dismissal of count III, the
defendants argued that "[a]n agent is not liable for wrongfully
interfering with its principal's contract since the acts of the
agent are imputed to the principal."
In its memorandum in opposition to the defendants' motion to
dismiss, Storm addressed the merits of the motion as it related to
counts I, II and IV of the complaint. Storm argued that dismissal
of count III was premature prior to discovery and objected to the
defendants' failure to specify whether they sought dismissal of
counts I, II and IV under section 2-615 (735 ILCS 5/2-615 (West
1996)) or section 2-619 (735 ILCS 5/2-619 (West 1996)) of the Code.
The trial court entered a "Final Judgment Order," granting the
defendants' motion to dismiss. Thereafter, Storm filed a timely
notice of appeal, invoking our jurisdiction under Supreme Court
Rule 301 (155 Ill. 2d R. 301).
Section 2-619.1 of the Code is a procedural statute which
allows a litigant to combine a section 2-615 motion to dismiss and
a section 2-619 motion for involuntary dismissal in one pleading.
735 ILCS 5/2-619.1 (West 1996). However, this statute is not a
legislative authorization for hybrid motion practice. Section 2-
619.1 specifically provides that a combined motion shall be divided
into parts and each part shall be limited to and specify a single
section of the Code under which relief is sought. 735 ILCS 5/2-
619.1 (West 1996). Meticulous practice dictates that the movants
clearly state the section of the Code under which a motion to
dismiss is brought. Illinois Graphics Co. v. Nickum, 159 Ill. 2d 469, 484, 639 N.E.2d 1282 (1994).
Other than in part III of their motion, which is directed to
count III of Storm's complaint, the defendants here failed to
specify whether they sought relief under section 2-615 or section
2-619 of the Code. While failure to properly label a motion to
dismiss is not a pleading practice which should be encouraged,
reversal for such a deficiency is appropriate only when prejudice
to the nonmovant results. Illinois Graphics Co., 159 Ill. 2d at
484. In reviewing the propriety of a dismissal resulting from an
undesignated motion, we will examine the grounds for the motion,
the relief requested and the treatment of the motion below to
determine whether the motion is properly classified as one brought
under section 2-615 or section 2-619. Illinois Graphics Co., 159 Ill. 2d at 484. Where, as in this case, the trial court fails to
specify the grounds upon which it relied in granting a motion to
dismiss, we will presume it was upon one of the grounds urged by
the defendant. Zielinski v. Miller, 277 Ill. App. 3d 735, 739, 660 N.E.2d 1289 (1995).
A section 2-615 motion attacks the sufficiency of a complaint
and raises the question of whether it states a cause of action upon
which relief can be granted. Burdinie v. Village of Glendale
Heights, 139 Ill. 2d 501, 505, 565 N.E.2d 654 (1990); Janes v.
First Federal Savings & Loan Ass'n, 57 Ill. 2d 398, 406, 312 N.E.2d 605 (1974). When ruling on a section 2-615 motion, the court may
only consider the facts apparent from the face of the complaint,
matters of which the court may take judicial notice, and judicial
admissions in the record. Mt. Zion State Bank & Trust v.
Consolidated Communications, Inc., 169 Ill. 2d 110, 115, 660 N.E.2d 863 (1995).
A section 2-619 motion raises certain defects or defenses and
poses the question of whether the defendant is entitled to judgment
as a matter of law. Illinois Graphics Co., 159 Ill. 2d at 485,
494. If the grounds for such a motion do not appear on the face of
the complaint, the motion must be supported by affidavit. 735 ILCS
5/2-619(a) (West 1996). When, however, the only grounds for a
section 2-619 motion appear on the face of the complaint, the
motion falls "within the area of confluence" between section 2-615
and section 2-619 (Illinois Graphics Co., 159 Ill. 2d at 486), and
the appropriate method for reaching the defect is a section 2-615
motion (Rowan v. Novotny, 157 Ill. App. 3d 691, 693-94, 510 N.E.2d 1111 (1987); Ill. Ann. Stat., ch. 110, par. 2-619, Historical &
Practice Notes, at 662 (Smith-Hurd 1983)).
In this case, the defendants supported their combined motion
with an affidavit attesting to matters of record in the Class
Action. However, we deem that affidavit to be surplusage as
everything contained therein is the proper subject of judicial
notice. See People v. Jackson, 182 Ill. 2d 30, 66, 695 N.E.2d 391
(1998).
In ruling on a motion to dismiss under either section 2-615 or
section 2-619 of the Code, the court must accept all well-pled
facts in the complaint as true and draw all reasonable inferences
from those facts in favor of the plaintiff. See Miner v. Gillette
Co., 87 Ill. 2d 7, 19, 428 N.E.2d 478 (1981); Your Style
Publications, Inc. v. Mid Town Bank & Trust Co., 150 Ill. App. 3d
421, 424, 501 N.E.2d 805 (1986); Holubek v. City of Chicago, 146
Ill. App. 3d 815, 817, 497 N.E.2d 348 (1986). Because the
resolution of either motion involves only a question of law, our
review is de novo. Stephen L. Winternitz, Inc. v. National Bank of
Monmouth, 289 Ill. App. 3d 753, 755, 683 N.E.2d 492 (1997).
Further, since, in support of their motion to dismiss counts I, II
and IV, the defendants relied on nothing other than the facts
alleged in Storm's complaint and matters of which judicial notice
can be taken, we find that Storm suffered no prejudice by reason of
the defendants' failure to properly designate the section of the
Code under which the dismissal of these counts was sought.
Consequently, we will address the merits of the trial court's
dismissal of each count of Storm's complaint.
The Cuculichs sought dismissal of the quantum meruit claim
asserted against them in count I on the basis that Storm had
conferred no benefit upon them individually and that its right to
fees, if any, was contingent upon the ultimate success of the Class
Action and the creation of a fund for payment of attorney's fees.
Storm argues that its right to seek recovery for the reasonable
value of its legal services accrued immediately upon its discharge
as co-counsel. Central to our resolution of this issue is the
applicability of the holding in In re Estate of Callahan, 144 Ill. 2d 32, 578 N.E.2d 985 (1991), to the rights of a discharged
attorney originally engaged to represent the plaintiffs in a class
action suit.
In Callahan, our supreme court held that a cause of action for
quantum meruit fees accrues in favor of an attorney engaged to
represent a client on a contingent fee basis immediately upon
discharge and prior to the resolution of the client's lawsuit.
Callahan, 144 Ill. 2d at 37-42. The defendants argue that, while
this rule is applicable to the circumstance where a single client
discharges an attorney retained on a contingent fee basis, it has
no application to the rights of a discharged attorney retained to
represent members of a class. They contend that Illinois adheres
to the "common fund doctrine," under which an attorney's right to
fees in a class action is contingent upon the ultimate success of
the litigation and the creation of a fund from which those fees can
be paid. See Fiorito v. Jones, 72 Ill. 2d 73, 377 N.E.2d 1019
(1978); Hamer v. Kirk, 64 Ill. 2d 434, 356 N.E.2d 524 (1976). The
defendants reason that, since class action suits are maintained for
the benefit of all class members, the costs of litigation should be
paid from the common fund so as to spread them proportionately
among those who benefit from the litigation.
The defendants are correct in their assertion that Illinois
adheres to the "common fund doctrine." However, we believe their
reliance upon that doctrine is misplaced under the circumstances of
the instant case.
Our supreme court analyzed the "common fund doctrine" and
revisited its origin and the rationale behind its application in
Brundidge v. Glendale Federal Bank, F.S.B., 168 Ill. 2d 235, 238,
659 N.E.2d 909 (1995), explaining that:
"Illinois has long adhered to the general American
rule that the prevailing party in a lawsuit must bear the
costs of litigation, unless a statutory provision or an
agreement between the parties allows the successful
litigant to recover attorney fees and the expenses of
suit. [Citations.] However, where the outcome of the
litigation has created a common fund, this court has
adopted the 'common fund doctrine.' [Citations.] The
common fund doctrine allows one who 'creates, preserves,
or increases the value of a fund in which others have an
ownership interest to be reimbursed from that fund for
litigation expenses incurred, including counsel fees.'
[Citations.] The doctrine finds its source in the
court's inherent equitable powers [citation] and is
founded on the rationale that successful litigants would
be unjustly enriched if their attorneys were not
compensated from the common fund created for the
litigants' benefit [citation]. By awarding fees payable
from the common fund created for the benefit of the
entire class, the court spreads the costs of litigation
proportionately among those who will benefit from the
fund. [Citations.]"
There is no doubt that, as the defendants argue, a number of
reported cases have denied claims for the payment of attorney's
fees incurred on behalf of successful litigants in class action
suits due to the absence of a common fund from which those fees
could be paid. See Hamer, 64 Ill. 2d at 440-41; Client Follow-Up
Co. v. Hynes, 105 Ill. App. 3d 619, 628-29, 434 N.E.2d 485 (1982).
The defendants also correctly quote the court in Fiorito v. Jones,
72 Ill. 2d 73, 87, 377 N.E.2d 1019 (1978), when they argue that,
"in a class action, the right to attorneys' fees is contingent upon
ultimate success and upon the presence of a fund from which fees
can be paid." However, a closer examination of these cases reveals
that they involve: 1) a request for an award of fees against
either the defendants or the class members when, although the
plaintiffs were successful in their class action, no fund had been
"brought into court" (Hamer, 64 Ill. 2d at 440-41; Client Follow-up
Co., 105 Ill. App. 3d at 629; see also Hoffman v. Lehnhausen, 48 Ill. 2d 323, 329, 269 N.E.2d 465 (1971)); or 2) an analysis of the
various factors to be used by a court in determining the amount of
reasonable fees it will order to be paid from the common fund
created for the benefit of the entire class (Fiorito, 72 Ill. 2d at
87-94). These cases do not address the rights of a discharged
attorney as against the individual class representative who engaged
him. To be sure, a class action is not "the usual contingent fee
case." Flynn v. Kucharski, 59 Ill. 2d 61, 66, 319 N.E.2d 1 (1974).
It is distinguished by the fact that the neither the attorney-
client relationship nor the attorney's fee is the result of a
voluntary agreement between the attorney and the class members as
a group. However, the same cannot be said of the relationship
between the attorney and the class representative. While it is
true that the attorney's fee in a class action suit is set by the
court, the attorney-client relationship between the attorney and
the class representative is purely voluntary.
The rationale underlying the holding in Callahan is no less
compelling when, as in this case, the discharged attorney was
engaged on a contingent fee basis to represent the plaintiffs in a
class action suit. Once the class representative discharges the
attorney, the contract governing their relationship ceases to exist
and the contingency term is no longer operative. Additionally, the
value of the attorney's services rendered prior to discharge cannot
be measured by the results obtained by another attorney, nor can
the attorney's right to compensation for those services be made
contingent upon the success or failure of another attorney. See
Callahan, 144 Ill. 2d at 39-41. Recognition of a cause of action
for quantum meruit fees in favor of a discharged attorney against
the individual class representative that retained the attorney's
services in a class action suit is nothing more than an
acknowledgement of the implied promise of a recipient of services
to pay for those services which are of value to him. See Callahan,
144 Ill. 2d at 40. The question of whether the class
representative derived a benefit from the services rendered by the
discharged attorney during the attorney's period of employment is
a factor to be considered in measuring the reasonable value of
those services. See Callahan, 144 Ill. 2d at 41. That question is
one of fact and is, therefore, inappropriate for resolution on a
motion to dismiss.
In accord with our recent decision in Much, Shelist, Freed,
Denenberg and Ament, P.C. v. Lison, ___ Ill. App. 3d ___, 696 N.E.2d 1196 (1998), we reject the defendants' arguments and find
that count I of Storm's complaint states a cause of action against
the Cuculichs for quantum meruit fees. Consequently, we reverse
the trial court's dismissal of count I.
Next, we address the propriety of the trial court's dismissal
of count II of Storm's complaint, which alleges a cause of action
against the Patner Defendants for breach of a guaranty agreement.
The Patner Defendants argued that count II must be dismissed
because any contract to answer for the debt of another must be in
writing pursuant to section 1 of the Frauds Act (740 ILCS 80/1
(West 1996)). They pointed out that the writing upon which Storm
relied contained only a promise to "protect [Storm's] hours," but
failed to contain either a promise to pay a debt or obligation owed
by the Cuculichs or the terms and conditions of the undertaking.
We agree.
If, as Storm alleges, the Patner Defendants agreed to
guarantee payment of its fees and become liable for the payment of
those fees in the event that the Cuculichs failed to pay, the
agreement is one to answer for the debt of another. Section 1 of
the Frauds Act bars any action upon such an undertaking "unless the
promise or agreement upon which such action shall be brought, or
some memorandum or note thereof, shall be in writing, and signed by
the party to be charged therewith, or some other person thereunto
by him lawfully authorized." 740 ILCS 80/1 (West 1996). The issue
then becomes whether the writing upon which Storm relies is
sufficient to satisfy the requirements of the statute.
A writing relied upon to satisfy the requirements of the
Frauds Act must itself show the existence of a contract and its
terms and conditions. Culbertson v. Carruthers, 66 Ill. App. 3d
47, 54, 383 N.E.2d 618 (1978). Even if the Patner Defendants'
agreement to "protect" Storm's "hours" could reasonably be
interpreted as an undertaking to guarantee payment of its fees, the
writing does not identify the fees referred to, specify the amount
guaranteed or the method by which that sum would be determined, or
set forth the event which would trigger an obligation to pay. We
find that the writing attached to count II of Storm's complaint
fails to satisfy the requirements of section 1 of the Frauds Act
(see Chapman v. Freeport Securities Co., 174 Ill. App. 3d 847, 854-
55, 529 N.E.2d 6 (1988)), and, therefore, affirm the trial court's
dismissal of count II.
The Patner Defendants sought dismissal of count III, in which
Storm asserted a claim for tortious interference with contract
against them, pursuant to section 2-615 of the Code. Their only
argument before the trial court in support of their motion to
dismiss that count was their contention that "[a]n agent is not
liable for wrongfully interfering with its principal's contract
since the acts of the agent are imputed to the principal." In
response, Storm argued that the count should not be dismissed
before discovery as "a jury may find that Patner was not acting as
agent for the Cuculichs at the time plaintiff was discharged."
At the outset, we reject Storm's argument that the defendants'
section 2-615 motion to dismiss count III was premature before
discovery. The question of whether a complaint states a cause of
action is determined based on the facts alleged therein and the
reasonable inferences favorable to the plaintiff which can be drawn
from those facts. Geick v. Kay, 236 Ill. App. 3d 868, 873, 603 N.E.2d 121 (1992). The question is one of law, not fact. Either
the complaint contains factual allegations in support of each
element of the claim that the plaintiff must prove in order to
sustain a judgment, or it does not. Schuler v. Abbott Labora-
tories, 265 Ill. App. 3d 991, 994, 639 N.E.2d 144 (1993). The
notion that plaintiffs are permitted to plead an action against a
defendant before they are possessed of sufficient information to
satisfy each element of the claim runs counter to Supreme Court
Rule 137, which requires that all pleadings be well grounded in
fact to the best of the pleader's knowledge, information and belief
after reasonable inquiry. 155 Ill. 2d R. 137.
We also reject the argument upon which the Patner Defendants
premised their motion to dismiss count III. The proposition that
an agent can never be held liable for wrongfully interfering with
his principal's contracts is far too broad. Even in circumstances
where an agent is cloaked with a qualified privilege, a claim for
tortious interference may lie where the agent's actions in
interfering with the principal's contract are unjustified or
malicious, such as where the agent's conduct is totally unrelated
or antagonistic to the principal's interests. HPI Health Care
Services, Inc. v. Mt. Vernon Hospital, Inc., 131 Ill. 2d 145, 156-
59, 545 N.E.2d 672 (1989).
Although we have rejected the broad proposition upon which the
Patner Defendants sought dismissal of count III, we believe that
further analysis of the count is necessary. Count III of Storm's
complaint is captioned "Interference with Contractual Relations."
An action for tortious interference with a contract which is
terminable at will, however, is classified as one for intentional
interference with prospective economic advantage. Anderson v.
Anchor Organization for Health Maintenance, 274 Ill. App. 3d 1001,
1013, 654 N.E.2d 675 (1995). Since the attorney-client
relationship is terminable at will (LaRocco v. Bakwin, 108 Ill.
App. 3d 723, 727-28, 439 N.E.2d 537 (1982)), the claim asserted in
count III of Storm's complaint is more properly classified as one
for intentional interference with prospective economic advantage
(Anderson, 274 Ill. App. 3d at 1013).
Count III of Storm's complaint alleges that, at all times
relevant, the Patner Defendants acted as counsel for the Cuculichs
in the Class Action. The existence of an attorney's fiduciary
relationship with his client gives rise to a qualified privilege in
favor of the attorney to advise the client without fear of personal
liability to third persons if that advice later proves to be
incorrect. Salaymeh v. Interqual, Inc., 155 Ill. App. 3d 1040,
1045, 508 N.E.2d 1155 (1987). When, as in this case, the existence
of a privilege in favor of the defendant is apparent on the face of
a claim for tortious interference with prospective economic
advantage, it is the plaintiff's burden to plead and prove that the
defendant's conduct was unjustified or malicious. Fellhauer v.
City of Geneva, 142 Ill. 2d 495, 512, 568 N.E.2d 870 (1991).
Storm alleged that the Patner Defendants "intentionally and
with malice caused or induced" the Cuculichs to terminate Storm
"without cause or justification." A complaint, however, may not
rest on mere unsupported factual conclusions. J. Eck & Sons, Inc.
v. Reuben H. Donnelley Corp., 213 Ill. App. 3d 510, 515, 572 N.E.2d 1090 (1991). Illinois is a fact pleading jurisdiction. Knox
College v. Celotex Corp., 88 Ill. 2d 407, 426-27, 430 N.E.2d 976
(1981). Conclusions of fact will not suffice to state a cause of
action regardless of whether they generally inform the defendant of
the nature of the claim against him. Adkins v. Sarah Bush Lincoln
Health Center, 129 Ill. 2d 497, 519-20, 544 N.E.2d 733 (1989).
Storm's conclusory allegations standing alone are insufficient
to satisfy its burden to set forth factual allegations from which
it could be reasonably inferred that the conduct of the Patner
Defendants in inducing the Cuculichs to discharge Storm was
unjustified or malicious. HPI Health Care, 131 Ill. 2d at 158.
The bare conclusions that the Patner Defendants acted inten-
tionally, maliciously, and without cause or justification are
insufficient to negate the protection of the privilege arising by
reason of the attorney-client relationship here. Philip I. Mappa
Interests, Ltd. v. Kendle, 196 Ill. App. 3d 703, 708-09, 554 N.E.2d 1008 (1990). Consequently, we find that count III of Storm's com-
plaint fails to state a cause of action.
Although, we may affirm the dismissal of a complaint on any
ground apparent from the record, even one not relied upon by the
trial court (Material Service Corp. v. Department of Revenue, 98 Ill. 2d 382, 387, 457 N.E.2d 9 (1983)), we decline to affirm the
dismissal of count III on the ground that it fails to state a cause
of action. It would be inappropriate for us to do so because that
deficiency was not addressed by the parties either before the trial
court or this court and because it may be correctable by amendment.
Geaslen v. Berkson, Gorov & Levin, Ltd., 155 Ill. 2d 223, 230-31,
613 N.E.2d 702 (1993); Keating v. Estate of Golding, 277 Ill. App.
3d 953, 957-58, 661 N.E.2d 541 (1996)). Having determined that the
Patner Defendants were not entitled to a dismissal of count III
based on the arguments set forth in their motion to dismiss, we
reverse the trial court's dismissal of that count. However,
because we find the complaint to be factually deficient as
discussed above, we instruct the trial court on remand to strike
count III and afford Storm a reasonable opportunity to amend it.
Lastly, we will address the dismissal of count IV of Storm's
complaint, in which it asserted a quantum meruit claim against the
Patner Defendants. The Patner Defendants sought dismissal of count
IV on the same grounds argued by the Cuculichs in support of
dismissal of the quantum meruit claim asserted against them in
count I. Consequently, for the same reasons stated in support of
our reversal of the dismissal of count I, we also reverse the
dismissal of count IV. As was the case with count III, however, we
have also identified a serious pleading deficiency in count IV
which merits further analysis.
It has been long settled in Illinois that, when an agent
entering into a contract with another discloses both his agency
status and the name of his principal or when the party dealing with
the agent knows that the agent is acting for his principal in
making a contract, the agent is not liable on the contract unless
he agrees to become personally liable. Chicago Title & Trust Co.
v. De Lasaux, 336 Ill. 522, 526, 168 N.E. 640 (1929). As the court
observed in Clark v. Maddux, 118 Ill. App. 3d 546, 548-49, 454 N.E.2d 1179 (1983), this rule has been applied in a number of cases
involving attorneys. See Petrando v. Barry, 4 Ill. App. 2d 319,
322-23, 124 N.E.2d 85 (1955); International Service Corp. v. Ooms,
105 Ill. App. 2d 391, 395-96, 245 N.E.2d 571 (1969); McCorkle v.
Weinstein, 50 Ill. App. 3d 661, 663-64, 365 N.E.2d 953 (1977);
Associated Claims Service, Inc. v. Rinella & Rinella, 79 Ill. App.
3d 1023, 1027-28, 398 N.E.2d 1211 (1979).
The factual allegations in Count IV of Storm's complaint
establish it was aware that the Patner Defendants were serving as
counsel for the Cuculichs when they retained Storm to act as co-
counsel. Therefore, it is clear that Storm knew of the Cuculichs'
identity and the Patner Defendants' status as their attorneys at
the time it agreed to serve as co-counsel. Further, count IV
contains no allegations which indicate that the Patner Defendants
agreed or intended to become personally liable for the payment of
Storm's fees. Although we find that count IV fails to state a
cause of action against the Patner Defendants, we decline to affirm
its dismissal for the same reasons that we declined to affirm the
dismissal of count III. We reverse the trial court's dismissal of
count IV but direct the trial court on remand to also strike count
IV and afford Storm a reasonable opportunity to amend it.
In summary, we reverse the trial court's dismissal of counts
I, III and IV of Storm's amended complaint, affirm its dismissal of
count II, and remand this action to the circuit court with
instructions to strike counts III and IV and afford Storm a
reasonable opportunity to amend those counts and for further
proceedings consistent with this opinion.
Affirmed in part, reversed in part and remanded with
directions.
THEIS and HOURIHANE, JJ., concur.
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