Fox v. Seiden

FIRST DIVISION
April 21, 2008

No. 1-06-2323

HORACE FOX, JR., Trustee in ) Appeal from the
Bankruptcy for Miriam Draiman, ) Circuit Court of
) Cook County.
Plaintiff-Appellant, )
)
v. )
)
GLENN SEIDEN; SARA M. COLLINS; ) No. 06 L 9362
GLENN SEIDEN AND ASSOCIATES, P.C.; )
an Illinois Professional Corporation, )
and AZULAY, HORN AND SEIDEN, LLC, an )
Illinois Limited Liability Company, ) The Honorable
) Kathy M. Flanagan,
Defendants-Appellees. ) Judge Presiding.

JUSTICE GARCIA delivered the opinion of the court.

The plaintiff, Horace Fox, Jr., as trustee in bankruptcy for

Miriam Draiman, filed a one-count amended verified complaint

against the defendants, Glenn Seiden, Sarah M. Collins, Glenn

Seiden & Associates, P.C., and Azulay, Horn & Seiden, LLC,1

alleging legal malpractice. The plaintiff's legal malpractice

claim arises from a judgment ordering Miriam to pay more than $1

million in attorney fees. It is Miriam's position that she is

not liable for the attorney fees and, but for the law firm's

1
The defendants in this case are individual attorneys and a

law firm that has undergone numerous changes during the time

period relevant to this appeal. For the sake of clarity, the law

firm and the individual attorneys will be referred to as "the law

firm" collectively, or individually where necessary.
negligence, the judgment for fees would not have been entered

against her. Upon the law firm's motion pursuant to section 2-

615 of the Code of Civil Procedure (the Code) (735 ILCS 5/2-615

(West 2004)), the trial court dismissed the verified amended

complaint, finding it failed to properly allege actual damages

and proximate cause. The plaintiff appeals. We reverse.

BACKGROUND

Because this case arises upon a section 2-615 motion to

dismiss, the facts are taken from the face of the plaintiff's

amended complaint and the attached documents. Iseberg v. Gross,

227 Ill. 2d 78, 81, 879 N.E.2d 278 (2007).

The legal malpractice complaint at issue in this appeal

stems from the law firm's representation of Miriam Draiman, her

husband Yehuda Draiman, and several corporations held by Miriam,

in the final stages of the case, Multiut Corp. v. Draiman, Nos.

01 CH 9989, 01 CH 20337, filed in the circuit court of Cook

County in 2001 (the underlying litigation).

I. The Underlying Litigation: Trial Proceedings

The underlying litigation involved a bitter family dispute.

Yehuda's brother, Nachshon, was the president of Multiut

Corporation (Multiut), which provides energy consulting and

energy management services. Yehuda and Miriam were both Multiut

employees.

In its 10-count complaint, Multiut alleged Yehuda and

2
Miriam, with the intent of confusing Multiut's customers,

conspired to divert business from Multiut by forming various

corporations, including M. Draiman Corporation, Multiut Electric,

Incorporated, U.S. Gas & Energy Corporation, U.S. Gas, Electric &

Telecommunications Corporation, and U.S. Utilities Corporation

(the corporate defendants). Count V of the complaint alleged

Yehuda and the corporate defendants, but not Miriam, violated

provisions of the Illinois Uniform Deceptive Trade Practices Act

(the Act) (815 ILCS 510/1 et seq. (West 2000)). In addition to

injunctive relief and monetary damages, Multiut sought payment of

attorney fees and costs in count V. Count VII, the only count in

which Miriam was individually named, alleged Yehuda, Miriam, and

some of the corporate defendants committed civil conspiracy in

diverting business from Multiut.

Yehuda, Miriam, and the corporate defendants were initially

represented in the underlying action by the law firm. The law

firm subsequently withdrew, and Yehuda, Miriam, and the corporate

defendants were represented by Altheimer and Gray. Following a

bench trial that lasted several weeks, the trial court found in

favor of Multiut in an order entered on January 17, 2003.

Relevant to this appeal, the trial court assessed damages in the

amount of $250,000 against Miriam. The court also assessed

damages against Yehuda and granted injunctive relief. Regarding

count V, the court stated, "[H]aving found that Yehuda Draiman

3
has purposely engaged in deceptive trade practices, it is this

court's determination that attorneys' fees and costs in

connection with the prosecution of this cause be awarded to the

Plaintiff and against the Defendants." The court ordered counsel

for Multiut to submit an accounting of fees and costs within 30

days.

Altheimer and Gray subsequently withdrew from the case. On

March 11, 2003, the law firm was retained again and filed a

limited appearance "for [the] purpose of any post-trial motions

prior to appeal."

On August 26, 2003, the trial court entered an order drafted

by Multiut's attorney stating, in relevant part, "Judgment is

entered on behalf of plaintiff and against defendants in the

amount of $1,002,046." The law firm, on September 19, 2003,

filed a "Motion to Clarify the Judgment Order of January 17, 2003

and Order of August 26, 2003" ("motion to clarify"). On

September 22, while the motion to clarify was pending, the law

firm filed a notice of appeal. The trial court, on September 30,

ruled it lacked jurisdiction to consider the motion to clarify

"in light of the pending appeal."

II. The Underlying Litigation: Appellate Proceedings

Yehuda and Miriam sought review of the trial court judgment

in this court. Yehuda was initially represented on appeal by the

law firm, and Miriam and the corporate defendants were

4
represented by different counsel. During the lengthy history of

the appeal, the law firm filed a motion to withdraw. We allowed

the motion, and Yehuda proceeded on appeal pro se.

On January 30, 2004, one justice of this court entered an

order finding that because Miriam was not named as a defendant in

count V of the underlying complaint--the count that resulted in

the $1,002,046 attorney fee award--she was not liable as to that

portion of the judgment. Multiut filed a petition for leave to

appeal that order in our supreme court. Miriam's counsel was

also permitted to withdraw, and Miriam proceeded pro se.

While leave to appeal the January 30, 2004, order was

pending, this court, on July 22, 2005, filed an opinion affirming

the judgment of the trial court. Multiut Corp. v. Draiman, 359

Ill. App. 3d 527, 834 N.E.2d 43 (2005). In our opinion, we

concluded that the evidence at trial established the defendant

corporations were the alter egos of Yehuda and Miriam. Multiut,

359 Ill. App. 3d at 533, 538. In response to Yehuda's contention

that the $1,002,046 attorney fee award was unreasonable, we

relied on the proposition that issues raised in a notice of

appeal but not argued in the appellate court are waived for

purposes of appeal. We held Yehuda forfeited his contention

because it was not made in his opening brief. Multiut, 359 Ill.

App. 3d at 539. Regarding Miriam's liability for the attorney

fee award, we stated:

5
 "As to Miriam's liability for the fee

award, she makes no argument other than

remarking in the conclusion of her appellate

brief that this court 'reversed the

assessment of *** attorney fees.' Miriam

presumably refers to the *** order entered on

January 30, 2004, and signed by one justice

of this court ***.

Multiut argues that although Miriam

apparently refers to the January 2004 order

in contending that this court has reversed

the fee award, that order has no effect on

this appeal. Multiut asserts that an order

signed by one appellate court justice has no

operative effect, and it has appealed that

issue to the Illinois Supreme Court

[citation].

Multiut contends that Yehuda and Miriam,

in their joint answer to Multiut's petition

in support of the fee award, did not argue

that Miriam was not liable for the fees.

Multiut points out that Miriam was

represented by counsel at the hearing on the

fee petition who did not contest her

6
 liability, and that although Miriam later

argued in a motion to clarify the fee award

that her liability should be reduced because

of her lower degree of culpability, she did

not assert that she bore no liability for the

fee award." Multiut, 359 Ill. App. 3d at

539-40.

We held Miriam's challenge to the fee award was forfeited

for purposes of review, as she failed to respond to Multiut's

arguments and "offer[ed] no legal argument that would free her

from the judgment against her and the other defendants."

Multiut, 359 Ill. App. 3d at 540. We also noted that at the time

our opinion was entered, the supreme court had not yet ruled on

Multiut's appeal of the January 30, 2004, order. Multiut, 359

Ill. App. 3d at 540.2

2
We take judicial notice of the following facts. On

September 29, 2005, the supreme court denied Multiut's petition

for leave to appeal. Multiut, 216 Ill. 2d 619 (2005). The

court, however, entered a supervisory order directing us to

vacate the January 30, 2004, order and reconsider it with a full

panel. On November 18, 2005, we vacated the January 30, 2004,

order. Referencing our July 22, 2005, opinion, we held the

motion upon which the January 30, 2004, order was entered was

moot.

7
 III. Bankruptcy Proceedings

On May 23, 2005, Miriam filed a chapter 13 (11 U.S.C. §1301

et seq. (2000)) bankruptcy petition in the Northern District of

Illinois. The bankruptcy court converted the petition to a

chapter 7 (11 U.S.C. §701 et seq. (2000)) petition. On July 1,

Multiut filed a motion for relief from the automatic stay in

which it requested that the court lift or modify the automatic

stay. On July 25, the court granted Multiut's motion.3

IV. The Legal Malpractice Complaint

On March 27, 2006, the plaintiff filed a one-count amended

verified complaint alleging legal malpractice. The complaint

3
In an attempt to shed further light on the bankruptcy

proceedings, the law firm has attached a decision from the

federal bankruptcy court entered on December 22, 2006, to its

brief. While we recognize courts may take judicial notice of

public records (Nordine v. Illinois Power Co., 32 Ill. 2d 421,

428, 206 N.E.2d 709 (1965)), the decision has no bearing on the

outcome of this case. It is well settled that "[f]acts not

alleged in or attached to the complaint cannot support a section

2-615 motion." Visvardis v. Eric P. Ferleger, P.C., 375 Ill.

App. 3d 719, 723, 724, 873 N.E.2d 436 (2007). As the bankruptcy

decision was entered subsequent to the dismissal order in this

case, and, therefore could not have been considered by the trial

court, we will not consider it on appeal.

8
alleged Miriam and the law firm entered into an attorney-client

relationship, the law firm had certain duties arising out of the

attorney-client relationship, and the law firm breached its

duties in three ways: (1) by failing to argue to the trial court

that it lacked authority to award attorney fees against Miriam

under the Act because she was not a named defendant in that

claim; (2) by failing to catch the imprecise language used in the

August 26, 2003, order that the judgment of $1,002,046 was

entered against the " 'defendants' generally rather than [the]

'defendants named in Count V *** for violations of the [Act]' ";

and (3) by failing to preserve the liability for attorney fees

issue for appeal.

The amended complaint made several factual allegations. It

alleged that at the August 26, 2003, hearing on Multiut's fee

petition, the law firm failed to argue that imposition of

attorney fees against Miriam was improper. The complaint further

alleged that although the law firm was shown a copy of the order

drafted by Multiut's attorney stating, "Judgment is entered on

behalf of plaintiff and against defendants in the amount of

$1,002,046," no objection to the "imprecise language" was raised.

Further, although the law firm filed a motion to clarify the fee

award, the law firm "failed to recognize the issue of the

wrongful imposition of an award of attorneys' fees against

[Miriam] pursuant to a claim in which she was not even named as a

9
defendant." Additionally, the trial court was divested of

jurisdiction to rule on the motion when the law firm filed a

notice of appeal "only one business day later." Therefore, the

amended complaint alleged, "even if [the law firm] had correctly

argued that the attorney fee award against [Miriam] was beyond

the trial court's authority (since she was not named as a

defendant in Count V) -- which they did not -- they nevertheless

*** prevented correction by the trial court by divesting it of

jurisdiction."

The amended complaint further alleged that Miriam initiated

bankruptcy proceedings in federal court, and that on July 25,

2005, the federal court lifted the automatic stay. According to

the amended complaint, since the entry of the July 25 order,

"Multiut's collection efforts have proceeded undaunted, as if the

Bankruptcy proceeding did not exist." The amended complaint

alleged Miriam's beneficial interest in a land trust holding

title to her home, was sold pursuant to a judicial sale, with

Multiut placing the highest bid. It also alleged Multiut

obtained a court order for turnover of Miriam's interest in

certain corporations, and, on September 21, 2005, Miriam was

forced to sign an irrevocable stock power, which turned over her

interest to the Cook County sheriff for judicial sale. The

amended complaint stated, "In short, Multiut has obtained and

[Miriam] has made partial payment towards reducing the amount

10
[Miriam] owes to Multiut, and Multiut's collection efforts

continue unabated with no relief in sight for [Miriam]."

The amended complaint further alleged:

"38. But for [the law firm's]

negligence and malfeasance, [Miriam] would

not have had judgment entered against her for

attorneys fees under the [Act]. Even if

judgment had been erroneously entered against

her in the trial court, the issue would have

been preserved for appeal and reversed by the

Appellate Court but for the negligent and

reckless conduct of [the law firm.]

39. As a direct, actual and proximate

cause of the breaches of the duty of

reasonable care by [the law firm], [Miriam]

has suffered and continues to suffer damages

in the amount of at least $1,234,053.96,

constituting the judgment for attorneys fees

and costs in the amount of $1,002,046 plus

interest at a rate of nine percent per annum

***.

40. Beyond the entry of the judgment

and the accrual of interest, [Miriam] has

been damaged and continues to be damaged

11
 through Multiut's aggressive efforts to

collect the full amount of the judgment,

which, despite partial satisfaction through

the sale of [Miriam's] beneficial interest in

the land trust, wage garnishment, and

turnover of her beneficial interest in

certain corporations, and other means,

remains due, owing, and fully subject to

collection. [The law firm's] breaches of the

duty of reasonable care is the direct,

actual, and proximate cause of this damage to

[Miriam]."

The law firm filed a section 2-615 motion to dismiss the

amended complaint. The law firm argued the plaintiff failed to

adequately plead actual damages and proximate cause. The trial

court granted the motion, finding the complaint "lack[ed] the

specific, relevant factual allegations necessary to state a cause

of action for legal malpractice." (Emphasis in original.)

Although the trial court allowed Miriam leave to file a second-

amended complaint, Miriam opted to stand on her amended pleading.

This timely appeal followed.

ANALYSIS

A motion filed pursuant to section 2-615 of the Code attacks

the legal sufficiency of the complaint. Borowiec v. Gateway

12
2000, Inc., 209 Ill. 2d 376, 382, 808 N.E.2d 957 (2004). When a

section 2-615 motion is granted, the issue on appeal is whether

the allegations in the complaint, when liberally construed, taken

as true, and viewed in the light most favorable to the plaintiff,

are sufficient to state a cause of action upon which relief can

be granted. Borowiec, 209 Ill. 2d at 382; Visvardis v. Ferleger,

375 Ill. App. 3d 719, 723-24, 873 N.E.2d 436 (2007); Kopka v.

Kamensky & Rubenstein, 354 Ill. App. 3d 930, 933, 821 N.E.2d 719

(2004). "When ruling on a section 2-615 motion, a trial court is

to dismiss the cause of action only if it is clearly apparent

that no set of facts can be proven which will entitle the

plaintiff to recovery." Borowiec, 209 Ill. 2d at 382-83. At

this stage, the plaintiff is not required to prove his or her

case; rather, the plaintiff need only allege sufficient facts to

state all of the elements of the cause of action. Visvardis, 357

Ill. App. 3d at 724. Our review is de novo. Hadley v. Illinois

Department of Corrections, 224 Ill. 2d 365, 370, 864 N.E.2d 162

(2007); Kopka, 354 Ill. App. 3d at 933.

To state a cause of action for legal malpractice, the

plaintiff must allege facts to establish (1) the defendant

attorney owed the plaintiff client a duty of due care arising

from an attorney-client relationship, (2) the attorney breached

that duty, (3) the client suffered an injury in the form of

actual damages, and (4) the actual damages resulted as a

13
proximate cause of the breach. Governmental Interinsurance

Exchange v. Judge, 221 Ill. 2d 195, 199, 850 N.E.2d 183 (2006);

see also Tri-G, Inc. v. Burke, Bosselman & Weaver, 222 Ill. 2d

218, 225-26, 856 N.E.2d 389 (2006). At issue in this case are

the elements of actual damages and proximate cause.

I. Actual Damages

The plaintiff contends her amended complaint adequately pled

the element of actual damages based on the existence of the

attorney fee judgment against Miriam, which the plaintiff

contends constitutes a sufficient pecuniary injury. The

plaintiff points our attention to Northern Illinois Emergency

Physicians v. Landau, Omahana & Kopka, Ltd., 216 Ill. 2d 294,

306-07, 837 N.E.2d 99 (2005).

In Northern Illinois Emergency Physicians, the plaintiff

sued the law firm that defended it in an indemnity claim arising

from a medical malpractice case. Our supreme court discussed the

actual damages element of a legal malpractice claim in detail.

"The injury in a legal malpractice

action is not a personal injury [citation],

nor is it the attorney's negligent act itself

[citation]. Rather, it is a pecuniary injury

to an intangible property interest caused by

the lawyer's negligent act or omission.

[Citations.] For purposes of a legal

14
malpractice action, a client is not

considered to be injured unless and until he

has suffered a loss for which he may seek

monetary damages. [Citation.] The fact that

the attorney may have breached his duty of

care is not, in itself, sufficient to sustain

the client's cause of action. Even if

negligence on the part of the attorney is

established, no action will lie against the

attorney unless that negligence proximately

caused damage to the client. [Citation.]

The existence of actual damages is therefore

essential to a viable cause of action for

legal malpractice. [Citation.]

In a legal malpractice action, actual

damages are never presumed. [Citation.]

Such damages must be affirmatively

established by the aggrieved client.

[Citation.] Unless the client can

demonstrate that he has sustained a monetary

loss as the result of some negligent act on

the lawyer's part, his cause of action cannot

succeed. [Citation.]

Making that demonstration requires more

15
 than supposition or conjecture. Where the

mere possibility of harm exits or damages are

otherwise speculative, actual damages are

absent and no cause of action for malpractice

yet exists. [Citation.] Damages are

considered to be speculative, however, only

if their existence itself is uncertain, not

if the amount is uncertain or yet to be fully

determined. [Citation.] " Northern Illinois

Emergency Physicians, 216 Ill. 2d at 306-07.

The supreme court explained, "[W]here an attorney has been

engaged to defend an action and the action is lost through the

attorney's negligence, the amount of the judgment suffered by the

client is, generally, a proper element of recovery in a

malpractice proceeding against the attorney." Northern Illinois

Emergency Physicians, 216 Ill. 2d at 307. As an example of the

application of the general rule, the court cited Gruse v.

Belline, 138 Ill. App. 3d 689, 486 N.E.2d 398 (1985).

The plaintiff cites Gruse as direct authority for the

proposition that the entry of a judgment against a legal

malpractice plaintiff in the underlying action constitutes actual

damages in the subsequent legal malpractice claim, without any

need to show payment of that judgment.

In Gruse, the plaintiff sued his former attorney, alleging

16
the attorney failed to properly advise the plaintiff about a

mortgage contingency clause in a real estate contract the

plaintiff signed but failed to perform. The jury returned a

verdict in favor of the plaintiff and the attorney appealed. On

appeal, one of the issues raised by the attorney was whether

proof of injury was satisfied by the two judgments entered

against the plaintiff, without a showing that he had paid either.

As support for his contention that proof of damages was lacking,

the defendant-attorney cited Goldzier v. Poole, 82 Ill. App. 469

(1898), for the proposition that "the payment or collectability

of a judgment sustained on account of an attorney's malpractice

must be shown before the amount of the judgment may properly be

considered an element of damages." Gruse, 138 Ill. App. 3d at

697. The Gruse court found Goldzier inapposite because the case

involved attorneys who were hired to prosecute, rather than

defend, a claim. Gruse, 138 Ill. App. 3d at 697. "Generally,

where an attorney is engaged to defend an action that is lost by

his negligence, the amount of the judgment suffered by the client

is a proper element of recovery in a malpractice proceeding

against the attorney." Gruse, 138 Ill. App. 3d at 698. As an

example of the application of this general rule, the court cited

Montfort v. Jeter, 567 S.W.2d 498 (Tex. 1978), which held a

judgment against the plaintiff resulting from his attorney's

negligence "was evidence of actual damages even though it

17
remained unpaid at the time of trial." Gruse, 138 Ill. App. 3d

at 698, citing Montfort, 567 S.W.2d at 499-500. Because the

plaintiff in Gruse introduced into evidence two judgments and no

contrary evidence was submitted, the court held the plaintiff's

damages were proved at trial. Gruse, 138 Ill. App. 3d at 698.

Here, the law firm argues Miriam's damages remain

speculative, unless and until she pays the $250,000 she does not

contest owing in the underlying litigation. Until then, her

claim of damages based on the unpaid fee judgment is insufficient

to constitute actual damages for purposes of legal malpractice.

The law firm relies primarily on Eastman v. Messner, 188 Ill. 2d

404, 721 N.E.2d 1154 (1999).

In Eastman, the supreme court answered the question whether

an employer that paid workers' compensation benefits to an

injured employee could assert a lien against the employee's

recovery in a legal malpractice suit where the suit was based on

the attorney's failure to timely file a personal injury action on

behalf of the employee against an alleged third-party tortfeasor.

In deciding the employer could not assert such a lien, the

supreme court addressed the concept of actual damages in a legal

malpractice suit.

"[A] plaintiff who obtains recovery in a

malpractice suit can be 'in no better

position by bringing suit against the

18
 attorney than if the underlying action

against the third-party tortfeasor had been

successfully prosecuted' [citation]. Thus, a

plaintiff's damages in a malpractice suit are

limited to the actual amount the plaintiff

would have recovered had he been successful

in the underlying case." Eastman, 188 Ill.

2d at 411-12.

To explain its holding, the supreme court set out a hypothetical

to make clear that no double recovery would occur based on the

employee's prior receipt of workers' compensation benefits. The

supreme court held that damages in the legal malpractice case

were limited to "the amount the employee lost as a result of the

attorney's malpractice," taking into account the amount of

benefits already received. Eastman, 188 Ill. 2d at 413. In

other words, the employee's damages were limited to the net

amount lost.

Applying the Eastman holding on the limitation of damages to

the case at hand, the law firm argues, "it is not the judgment

rendered against Miriam but rather the net that she paid to

satisfy that judgment" that constitutes her actual damages. The

argument goes, because the amended complaint does not "allege

that Miriam has paid any portion of the attorney fee judgment,"

the complaint fails to allege actual damages. Because the Gruse

19
holding stands in direct opposition to its position, the law firm

argues that Gruse "has been overruled sub silentio in Eastman."

We do not agree with the law firm's arguments or its

suggestion that our supreme court works in mysterious ways.

While Eastman provides clear discussion of the legal

malpractice action underlying the case, the case provides no

authority for the position the law firm asserts in the context of

this case. Eastman did not discuss the sufficiency of the

pleadings to make out a legal malpractice action. Nor did it

discuss the pleading requirements for the actual damages element

of a legal malpractice action in the context of a failure to

defend, rather than prosecute, a lawsuit.

To the extent Eastman provides any guidance on the damages

issue before us, it makes clear, when the supreme court's holding

in Northern Illinois Emergency Physicians is kept in mind, the

distinction regarding damages in a legal malpractice action

involving negligence in the prosecution of a case and negligence

in the defense of a case.

In a prosecution-type case, damages cannot be established by

the loss of the underlying case itself. It is not enough to

allege the attorney negligently "lost" the case because "no

action will lie against the attorney unless that negligence

proximately caused damage to the client." Northern Illinois

Emergency Physicians, 216 Ill. 2d at 306-07. The plaintiff must

20
be able to establish, in the case within a case, the damages "the

plaintiff would have recovered had he been successful in the

underlying case." Eastman, 188 Ill. 2d at 412. The plaintiff

must demonstrate he "would have been compensated for an injury

caused by a third party, absent negligence on the part of the

plaintiff's attorney." Eastman, 188 Ill. 2d at 411. A judgment

of "not guilty" rendered against a client, as a plaintiff in the

underling case, is not the equivalent for purposes of actual

damages in a legal malpractice case of a "guilty" verdict with

damages assessed against a client, as a defendant in the

underlying case. The plaintiff's burden in a defense-type legal

malpractice case is generally addressed in Northern Illinois

Emergency Physicians, 216 Ill. 2d 294.

In Northern Illinois Emergency Physicians, the appellate

court reversed the trial court's grant of summary judgment,

holding the entry of the indemnity judgment against the plaintiff

Northern Illinois Emergency Physicians (NIEP), combined with that

judgment remaining outstanding, was sufficient to overcome a

summary judgment motion on actual damages. On appeal to the

supreme court, NIEP argued the entry of the $4 million indemnity

judgment was sufficient to constitute actual damages "even when

the judgment remains unpaid at the time the malpractice claim is

tried," citing as authority Gruse. Northern Illinois Emergency

Physicians, 216 Ill. 2d at 308. The supreme court reversed, but

21
not on the actual damages issue, instead, on proximate cause.

The supreme court noted that NIEP was already jointly and

severally liable for the $4 million judgment in the underlying

medical malpractice action. The only actual effect of the

indemnity judgment "was to change the party to whom the $4

million was owed." Northern Illinois Emergency Physicians, 216

Ill. 2d at 311. "The acts or omissions of NIEP's lawyers in

defending against the indemnity claim therefore did not place

NIEP in any worse position than it was already in." Northern

Illinois Emergency Physicians, 216 Ill. 2d at 311. In finding no

proximate causation from the lawyers' actions to the alleged

damages, the supreme court expressly declined to reverse the

appellate court's judgment "on whether the existence of an

unsatisfied judgment is sufficient, in and of itself, to

withstand a challenge to the damages element of a legal

malpractice claim on a motion for summary judgment." Northern

Illinois Emergency Physicians, 216 Ill. 2d at 310. The supreme

court also made clear, "Damages are considered to be speculative

*** only if their existence itself is uncertain, not if the

amount is uncertain or yet to be fully determined." (Emphasis

added.) Northern Illinois Emergency Physicians, 216 Ill. 2d at

307. The court, citing Gruse approvingly, noted the general rule

that a judgment is a proper element of recovery in a malpractice

suit against an attorney. Northern Illinois Emergency

22
Physicians, 216 Ill. 2d at 307. The supreme court has not sub

silentio overruled Gruse.

In this case, while it is true the plaintiff did not allege

in the amended complaint that any portion of the judgment had

been paid, a judgment of $1,002,046 was entered against Miriam

because of negligence attributed to the law firm, an allegation

we must accept as true. In line with Gruse, we find the unpaid

judgment against Miriam resulting from the law firm's negligence

"was evidence of actual damages even though it remained unpaid."

Gruse, 138 Ill. App. 3d at 698. We therefore find the plaintiff

properly alleged actual damages. Consequently, the trial court

erred in dismissing the amended complaint on that basis.

II. Proximate Cause

Proximate cause is also an essential element of a legal

malpractice claim. Governmental Interinsurance Exchange, 221

Ill. 2d at 199. To satisfy this element, the plaintiff must

plead sufficient facts to establish that "but for" the negligence

of the attorney, the client would have successfully defended the

underlying suit. Albright v. Seyfarth, Fairweather, Shaw &

Geraldson, 176 Ill. App. 3d 921, 926, 531 N.E.2d 948 (1988).

We look to the plaintiff's amended complaint to determine

whether sufficient facts have been pled to survive a section 2-

615 challenge on the element of proximate cause. As discussed in

detail above, the plaintiff's amended complaint alleged that the

23
attorney fee award would not have been entered against Miriam but

for the negligence of the law firm. The plaintiff alleged the

law firm appeared at the hearing on Multiut's fee petition, yet

made no objection to the "imprecise language" of the court's

order awarding fees. Although the law firm filed a motion to

clarify the fee award, it did not raise the contention that

Miriam was not liable for the more than $1 million awarded in

fees based on not being a named defendant in count V. The

amended complaint also alleged that, even if the motion to

clarify had raised this contention, the law firm foreclosed the

trial court from ruling upon it by its precipitous filing of a

notice of appeal. Thus, the plaintiff alleged, "But for [the law

firm's] negligence and malfeasance, [Miriam] would not have had

judgment entered against her for attorneys fees under the [Act]."

We find the alleged facts, liberally construed, taken as true,

and viewed in the light most favorable to the plaintiff,

sufficiently plead the element of proximate cause.

Finally, the law firm argues that the sufficiency of the

pleadings on proximate cause is no bar to upholding Miriam's

liability for the attorney fee judgment. According to the law

firm, Miriam's position would be the same even if the alleged

negligence had not occurred for two reasons. See Northern

Illinois Emergency Physicians, 216 Ill. 2d at 311 (NIEP not being

placed in any worse position, it cannot be said its lawyers'

24
negligence proximately caused it any injury).

First, Miriam was personally liable for the attorney fee

award under the alter ego doctrine. The law firm points to our

prior Multiut Corp. opinion where we concluded "[t]he evidence

presented at trial established that the defendant companies,

including Multiut Electric and M. Draiman Corporation, were alter

egos of Yehuda and Miriam, who both acknowledged forming the

entities." (Emphasis added.) Multiut Corp., 359 Ill. App. 3d at

538. According to the law firm, because this court has

previously found the corporate defendants, who are undisputably

liable for the $1,002,046 attorney fee judgment, to be Miriam's

alter egos, she would likewise be liable for the attorney fee

award against the corporate defendants regardless of any of the

alleged actions or inactions taken by the law firm. See, e.g.,

In re Rehabilitation of Centaur Insurance Co., 158 Ill. 2d 166,

173, 632 N.E.2d 1015 (1994); Ted Harrison Oil Co. v. Dokka, 247

Ill. App. 3d 791, 794-95, 617 N.E.2d 898 (1993) (piercing

corporate veil will impose personal liability on a shareholder

found to be alter ego of corporation). The plaintiff responds

that our finding the defendant corporations to be alter egos of

Miriam was erroneous, as without foundation in the underlying

record, because the trial court in the underlying litigation only

found the defendant corporations were alter egos of Yehuda. The

plaintiff also argues that even if the defendant corporations

25
were Miriam's alter egos, liability would not necessarily follow

because Miriam was not named as a defendant in count V and,

consequently, had no opportunity to defend against that claim.

Second, the law firm points to the trial court's judgment

against Miriam under the conspiracy charge in count VII.

According to the law firm, she is therefore liable for the

attorney fee judgment because "the effect of a conspiracy is to

extend liability to each co-conspirator for all the tortuous acts

committed by the other co-conspirators in furtherance of the

conspiracy."

The argument regarding whether we properly found Miriam to

be an alter ego of the defendant corporations is intriguing. It

is also interesting to consider whether Miriam would nonetheless

have to answer for the attorney fee judgment as a co-conspirator

regardless of the alleged negligence of the law firm. However,

we need not address these arguments at this stage of the

litigation because this appeal arises from the grant of a section

2-615 motion to dismiss; the only issue on appeal is whether the

allegations in the complaint, taken as true and viewed in the

light most favorable to the plaintiff, are sufficient to state a

cause of action upon which relief can be granted. Borowiec, 209

Ill. 2d at 382. As discussed above, the plaintiff's amended

complaint sets forth sufficient facts to plead the element of

proximate cause. Consequently, the trial court erred in

26
dismissing the amended complaint on that basis as well.

CONCLUSION

Because the plaintiff's amended complaint alleged sufficient

facts on the elements of actual damages and proximate cause, the

trial court erred in dismissing the amended complaint.

Accordingly, the judgment of the circuit court of Cook County is

reversed, and the case is remanded for further proceedings

consistent with this opinion.

Reversed; cause remanded.

CAHILL, P.J., and R. GORDON, J., concur.

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 REPORTER OF DECISIONS - ILLINOIS APPELLATE COURT
_________________________________________________________________

HORACE FOX, JR., Trustee in Bankruptcy for Miriam Draiman,
Plaintiff-Appellant,
v.
GLENN SEIDEN; SARA M. COLLINS; GLENN SEIDEN AND
ASSOCIATES, P.C.;an Illinois Professional Corporation, and AZULAY,
HORN AND SEIDEN, LLC, an Illinois Limited Liability Company,
Defendants-Appellees.
________________________________________________________________

No. 1-06-2323

Appellate Court of Illinois
First District, First Division

Filed: April 21, 2008
_________________________________________________________________

JUSTICE GARCIA delivered the opinion of the court.
Cahill, P.J., and R. Gordon, J., concur.
_________________________________________________________________

Appeal from the Circuit Court of Cook County
Honorable Kathy M. Flanagan, Judge Presiding
_________________________________________________________________

For PLAINTIFF - Ashman Law Offices, LLC
APPELLANT 161 North Clark Street, Suite 3575
Chicago, IL 60601

For DEFENDANTS - Elliot R. Schiff, Esq.
APPELLEES Schiff, Gorman & Krkljes
One East Wacker Drive, Suite 2850
Chicago, IL 60601

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