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Adler Center v. Chicago Title & Trust Co.





Appeal from the Circuit Court of Cook County; the Hon. Joseph Wosik, Judge, presiding.


Rehearing denied January 22, 1985.

This is an appeal from an order denying a motion to set aside a settlement order in a commercial landlord-tenant dispute, and from the denial of plaintiff's motions for change of venue.

Plaintiff, Adler Center for Behavior Modification, Inc., was a commercial tenant at 310 South Michigan Avenue in Chicago. Defendant is the trustee under a land trust which owns the building. Dino D'Angelo is the beneficiary of the trust, and James Gulden is the building manager. Plaintiff's lease contained a provision allowing defendants to substitute similar premises for those occupied by plaintiff upon 90 days' advance notice.

On May 2, 1982, plaintiff was notified by defendant that a new tenant would be occupying plaintiff's offices and that plaintiff would be moved to a new and comparable location at defendants' expense. The notice did not specify the date on which the move was to take place.

On May 20, 1982, defendants terminated plaintiff's lease for failure to pay rent after a dispute arose involving certain rented storage space. Defendants subsequently accepted payment by plaintiff of rent for May, June and July 1982.

On July 12, 1982, 71 days after plaintiff's receipt of the substitution of premises notice, defendants cut off electrical services to the leased premises. On July 13, the doors to plaintiff's offices were padlocked and workers hired by defendants began removing furniture from the leased premises and dismantling fixtures. Plaintiff filed a verified complaint and an emergency motion for temporary restraining order and preliminary injunction. At this time plaintiff was represented by the law firm of Rudnick and Wolfe. The case was assigned to Judge Holzer, who allowed the requested emergency relief. The dismantling of plaintiff's offices continued, however, and on July 14, 1982, plaintiff presented a verified emergency petition for a rule to show cause, alleging that defendants were removing plaintiff's furniture and demolishing walls in plaintiff's offices in violation of the court's order. Judge Holzer entered and continued the petition for the rule to the next day.

About this time, the law firm of Friedman and Koven, attorneys for defendants, indicated that they sought the disqualification of Rudnick and Wolfe as plaintiff's attorneys due to Rudnick and Wolfe's prior representation of defendant Dino Di'Angelo. On July 14, 1982, Rudnick and Wolfe arranged for the law firm of Weissman and Pond to represent plaintiff. Plaintiff's principal, Benjamin Belden, was introduced to attorney Weissman and endorsed his check for Rudnick and Wolfe's retainer fee over to Weissman.

On July 15, defendants filed a verified motion to dissolve the temporary restraining order. On that same day, Judge Holzer recused himself from the case after engaging in ex parte communications about the case with an attorney from Friedman and Koven. The case was assigned to Judge Wosik, and settlement negotiations were begun.

The negotiations took place in Judge Wosik's chambers. Defendants were represented by Friedman and Koven and plaintiff by Weissman, although Weissman had yet to file an appearance in the case. Although the facts relating to the negotiations are unclear, it appears that during the negotiations between Judge Wosik, attorneys from Friedman and Koven and attorney Weissman, Mr. Belden remained in the courtroom, accompanied by four attorneys from Rudnick and Wolfe. Belden and Weissman conferred frequently during the course of the negotiations, and a settlement order, prepared by Weissman, was entered by Judge Wosik on July 15, 1982. The order provided that plaintiff would vacate the premises and defendants would return plaintiff's furniture and pay $9,500 as damages.

On August 13, 1982, Weissman and Pond filed plaintiff's motion to vacate the July 15, 1982, settlement order and a motion for leave to withdraw as counsel due to "irreconcilable differences" between counsel and client arising from plaintiff's desire to have the settlement order vacated. The court continued the motion to vacate, granted Weissman and Pond's motion to withdraw and granted William Arnold of Arnold and Hennessy leave to file his appearance for plaintiff.

Plaintiff filed an amended motion to vacate on September 24, 1982. Plaintiff was now represented by Marshall Patner in addition to Arnold and Hennessy. The amended motion to vacate included several affidavits detailing the circumstances relating to the conflict of interest which caused Rudnick and Wolfe's disqualification. The motion stated alternative grounds for vacating the settlement order, addressed to the equitable powers of the court, including the "gross disparity" in the bargaining positions of the parties due to the allegedly tainted representation provided by plaintiff's various attorneys, the emotional state of Belden and the insufficiency of the damages settled upon. Plaintiff then filed a motion for change of venue as a matter of right, which was denied. The court also denied plaintiff's second motion for change of venue based upon newly discovered prejudice and denied plaintiff's motion to vacate the July 15, 1982, settlement order. Plaintiff appeals.

Plaintiff first contends that the trial court erred in denying its motion to vacate the July 15, 1982, settlement order. Plaintiff argues that its bargaining position in the settlement negotiations was adversely affected by Rudnick and Wolfe's continued representation of plaintiff after the disclosure of their past representation of one of the defendants. Plaintiff also argues that Weissman, the attorney chosen by Rudnick and Wolfe to represent plaintiff after Rudnick and Wolfe's disqualification, was merely Rudnick and Wolfe's "alter ego" and therefore that Weissman's representation of plaintiff was tainted.

Settlements are to be encouraged and given full force and effect. They should not be set aside absent a showing of fraud or mistake. (Sheffield Poly-Glaz, Inc. v. Humboldt Glass Co. (1976), 42 Ill. App.3d 865, 868, 356 N.E.2d 837.) The cases cited by plaintiff in support of his position are personal injury tort actions in which the conflicting interests of the attorneys and the inadequacy of the settlement amounts indicated that the rights of the plaintiffs had been adversely affected to such an extent that, in the courts' opinion, vacation of the settlement orders was warranted. (Scheffki v. Chicago, Milwaukee, St. Paul & Pacific R.R. Co. (1971), 1 Ill. App.3d 557, 274 N.E.2d 631; In re Estate of Lilly (1976), 41 Ill. App.3d 348, 354 N.E.2d 96.) In Scheffki, a minor boy suffered the loss of both legs in a railroad accident. The attorney who purported to represent him was actually a railroad attorney selected by the defendant railroad and introduced to the boy's father by the railroad's claims adjuster. The attorney induced the father to accept a $15,000 settlement. We affirmed the trial court's vacation of the settlement order, based upon the concealment of the attorney's real interest and the inadequacy of the settlement. Lilly, which distinguished Scheffki, was a wrongful death action in which the decedent's estate was administered by the same law firm that represented the defendant ...

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