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Sheetz v. Morgan

OPINION FILED JULY 28, 1981.

ALBERT L. SHEETZ, CLAIMANT-APPELLEE,

v.

MARY MORGAN, EX'X OF THE ESTATE OF SAMUEL MORGAN, DECEASED, APPELLANT.



APPEAL from the Circuit Court of Lake County; the Hon. ALVIN SINGER, Judge, presiding.

MR. JUSTICE REINHARD DELIVERED THE OPINION OF THE COURT:

On January 7, 1977, Dr. Albert Sheetz (claimant) filed a claim against the estate of attorney Samuel Morgan (estate) for breach of contract, alleging that Morgan while acting as claimant's attorney neglected to file certain "security statements" in connection with the preparation of an equipment lease, resulting in a loss of property to claimant. On April 4, 1977, the claim was dismissed by the trial court. Subsequently, this court issued an order under Supreme Court Rule 23 (Ill. Rev. Stat. 1979, ch. 110A, par. 23) reversing the trial court. Following remand, the claimant moved for summary judgment on the issue of liability only, which was granted by the trial court in November 1979. Following further hearing on the issue of damages, the court awarded claimaint $97,650 as a seventh-class claim against the estate. The estate's motion for rehearing was denied, and this appeal followed.

The following facts were alleged in the motion for partial summary judgment. Samuel Morgan was an attorney engaged in the general practice of law in Chicago in 1974. Just prior to December 19, 1974, claimant requested Morgan to prepare a fixture and equipment lease. Morgan agreed to prepare such a document and also agreed "to do all other acts necessary to complete the lease and protect claimant's property." Morgan prepared the lease, but did not file financing statements. In October 1975, claimant's lessee filed bankruptcy proceedings and was discharged in bankruptcy. Claimant filed a petition in bankruptcy court to reclaim the leased property, but the claim was disallowed by the court, which had interpreted the lease to be a secured sale subject to the filing provisions of article 9 of the Uniform Commercial Code (Ill. Rev. Stat. 1979, ch. 26, par. 9-101 et seq.). As a result of the failure to file financing statements, claimant alleged he suffered a loss of all the equipment and sought damages therefor.

On July 17, 1979, the estate sought leave to file a late jury demand, but that request was denied by the trial court. Shortly thereafter, partial summary judgment was entered for the claimant allowing the claim and, subsequently, after a hearing on damages, the claimant was awarded $97,650. The estate presents four issues for resolution by this court:

(1) whether the court erred in entering summary judgment for the claimant absent expert testimony;

(2) whether the claim against the estate should have been dismissed for failure to state sufficiently the nature of the claim;

(3) whether the court erred in its assessment of damages;

(4) whether the court abused its discretion in refusing to permit the estate to file a late jury demand.

I

• 1 Claimant argued, and the trial judge agreed, that expert testimony was unnecessary in this case, and that Morgan's failure to file financing statements constituted malpractice as a matter of law. We disagree.

Summary judgment is only appropriate "if the pleadings, depositions, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." (Ill. Rev. Stat. 1979, ch. 110, par. 57(3).) The purpose of summary judgment is not to try issues of fact, but to determine whether any genuine issues of fact exist. (Fishel v. Givens (1977), 47 Ill. App.3d 512, 362 N.E.2d 97; McHenry Sand & Gravel, Inc. v. Rueck (1975), 28 Ill. App.3d 460, 328 N.E.2d 679.) Summary judgments are to be granted with great caution (Joiner v. Benton Community Bank (1979), 76 Ill. App.3d 871, 395 N.E.2d 691) and only where the moving party's right to such a remedy is clear and free from doubt. (Lind v. Zekman (1979), 77 Ill. App.3d 432, 395 N.E.2d 964; Gagliardo v. Vodica (1978), 58 Ill. App.3d 1053, 374 N.E.2d 1302.) Such is not the case here, especially in light of the total absence of expert testimony.

Claimant cites Practical Offset, Inc. v. Davis (1980), 83 Ill. App.3d 566, 404 N.E.2d 516, for the proposition that malpractice suits based on a failure to file a financing statement may be disposed of by summary judgment without expert testimony. While the reviewing court affirmed the summary judgment, it is important to point out that in Practical Offset, Inc., an expert's affidavit was submitted by plaintiff on the issue of standard of care. Also, and more importantly, the transaction involved therein was clearly and indisputably a secured sale subject to article 9 of the U.C.C. The agreement to sell certain business assets between the plaintiff client and the other party to the contract specifically provided that a promissory note would be secured by a security agreement in the form approved by counsel (defendant therein) together with a proper financing statement for filing under the U.C.C. and such were, in fact, executed on the date of closing. The defendant attorney drafted the financing statement, but simply failed to file it because he relied on opposing counsel to do so.

In discussing the standard of care for an attorney, the court quoted at length from Schmidt v. Hinshaw (1979), 75 Ill. App.3d 516, 522, 394 N.E.2d 559:

"The law is well settled that an attorney is liable to his client for damages only when he fails to exercise a reasonable degree of care and skill, and the law distinguishes between negligence and mere errors of judgment. [Citations.] The question of whether an attorney has exercised a reasonable degree of care and skill is one of fact [citation], and in Illinois the standard of care against which the attorney's conduct will be measured must generally be established through expert testimony. [Citations.] However, where `the negligence is so grossly apparent * * * that a layman would have no difficulty in appraising it' [citation] * * *, as where the record discloses such an obvious, explicit, and undisputed breach of the attorney's duty of care as letting the statute of limitations run, expert testimony as to the ...


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