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08/12/87 Keith Mclane Et Al., v. Fred G. Russell Et Al.

August 12, 1987

KEITH MCLANE ET AL., PLAINTIFFS-APPELLEES AND CROSS-APPELLANTS

v.

FRED G. RUSSELL ET AL., DEFENDANTS-APPELLANTS AND CROSS-APPELLEES



APPELLATE COURT OF ILLINOIS, THIRD DISTRICT

512 N.E.2d 366, 159 Ill. App. 3d 429, 111 Ill. Dec. 250 1987.IL.1161

Appeal from the Circuit Court of Peoria County; the Hon. John Gorman, Judge, presiding.

APPELLATE Judges:

JUSTICE SCOTT delivered the opinion of the court. STOUDER and WOMBACHER, JJ., concur.

DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE SCOTT

Defendants, Fred G. Russell and Johnson, Martin & Russell, a professional corporation, appeal the trial court's judgment on the verdict entered in favor of the plaintiffs, Keith McLane and Cecil McLane, individually, and Cecil McLane, executor of the estate of Grace M. Shugart, in the amount of $325,000 for damages resulting from their not receiving a one-half interest in the Shugart 240-acre farm on the death of Grace M. Shugart. The McLanes cross-appeal the trial court's setoff of $66,455, which was one-half of the amount they received in settlement of a suit filed against the administrator of Helen Shugart's estate for the entire farm.

The facts which underlie the cause in this appeal have been presented previously in this court's earlier opinion in In re Estate of Shugart (1980), 81 Ill. App. 3d 538, 401 N.E.2d 611. In summary, the McLanes, father and son, were tenant farmers on a 240-acre farm located in Bureau County which was owned in joint tenancy by Grace M. and Helen Shugart, sisters who never married. The elder McLane had farmed the Shugart land since 1946. Grace and Helen first executed wills in 1942, wherein they left all of their property to each other. In 1958, attorney Fred G. Russell, at the sisters' request, placed their farm into joint tenancy ownership, with right of survivorship. In 1961, Russell drafted a new will for Grace wherein she left all of her property to Helen. Helen was adJudged incompetent in 1971 and Russell was appointed her conservator.

Russell drafted a new will for Grace in 1975, wherein she devised a life estate of her interest in the farm to Cecil McLane with the remainder interest to Keith McLane. In 1976, Russell revised Grace's 1975 will making some minor changes, but leaving unmodified the provisions for the McLanes. At no time prior to Grace's death in April 1977 was the joint tenancy of the Shugart farm severed and on Grace's death her one-half undivided interest in the farm transferred by operation of law to Helen. On Helen's subsequent death, the farm transferred to the Shugarts' cousins in fee simple.

The McLanes brought the instant suit in the circuit court of Peoria County alleging that Russell's failure to sever the joint tenancy between the sisters following his drafting and the execution of Grace's two wills frustrated Grace's testamentary intent and irrevocably denied them a one-half interest in the Shugart farm. The McLanes sought an award of damages for one-half the value of the Shugart farm. Following a four-day jury trial, the trial court entered judgment on the verdict in favor of the McLanes in the amount of $325,000. The trial court granted the defendants' motion for setoff, but only as to one-half the amount the McLanes received in settlement of their suit against Helen Shugart's estate, thereby reducing the damage award to $258,545.

Russell and Johnson, Martin & Russell, a professional corporation, request this court to reverse the judgment entered and to enter judgment notwithstanding the verdict or, in the alternative, to remand the cause for a new trial. They contend that reversible error occurred when the trial court ruled (1) that the McLanes' settlement of their suit filed against Helen Shugart's estate did not bar the instant suit and that evidence regarding the other suit and settlement should not be heard by the jury; (2) that the statute of limitations had not run to bar the instant suit; (3) that venue was proper in the circuit court of Peoria County; (4) the McLanes were the primary intended beneficiaries of the attorney-client relationship which existed between Russell and Grace and they were therefore proper plaintiffs in a legal malpractice action; and (5) the McLanes met their burden of establishing a prima facie case that Russell was negligent and that the alleged negligence was a sufficient proximate cause of their loss and therefore the case could be submitted to the jury. Further, Russell and Johnson, Martin & Russell maintain that the trial court committed reversible error in certain evidentiary rulings concerning testimony by the McLanes' experts, in allowing the jury to consider conflict of interest evidence, and in precluding their expert witness from testifying regarding a deposition he reviewed and which allegedly was relied on to form the basis of his opinion.

The McLanes cross-appeal the trial court's setoff of the jury's damage award and request reinstatement of the judgment in full. They contend that the sum of their prior settlement and the jury award does not equal the full value of the entire farm, which they claim they would have received after the death of both Shugart sisters.

We direct our review initially to the issue of whether the McLanes may be considered proper plaintiffs in the instant legal malpractice action. The doctrine enunciated in Pelham v. Griesheimer (1982), 92 Ill. 2d 13, 440 N.E.2d 96, which found a duty owing by an attorney to a non-client is clearly applicable to the instant cause. For a non-client to establish a duty owing him stemming from an attorney-client relationship, he must allege and prove that the intent of the client was to benefit him and that the primary purpose of the attorney-client transaction was to achieve for him the intended benefit. Our review of the record, the testimony of the witnesses, and Grace's last and final will clearly reveal that her intent was to benefit the McLanes as to her one-half interest in the farm at her death. The purpose of the attorney-client transactions in 1975 and 1976, which involved the drafting by Russell of Grace's last two wills, was to obtain for the McLanes the intended benefit of their receiving a one-half interest in the Shugart farm. We find the McLanes to be proper parties in the instant cause in keeping with the Pelham doctrine establishing a duty owing by an attorney to a nonclient. Given the existence of such a duty, the McLanes were entitled to proceed with their claim of a breach due to Russell's failure to sever the joint tenancy between Grace and her sister Helen.

We next consider whether the McLanes were precluded from going forward with their action due to the expiration of the five-year statute of limitations governing the instant suit (Ill. Rev. Stat. 1985, ch. 110, par. 13-205) and due to their settlement of the suit brought against the administrator of the Helen Shugart estate, the Citizens First National Bank of Princeton.

Russell and Johnson, Martin & Russell maintain the five-year statute of limitations began running on August 19, 1976, the date Grace executed her final will, and thus the McLanes' suit must have been filed no later than August 19, 1981. The McLanes maintain their filing suit in March 1982 was within the applicable statute in that the limitation period began on Grace's death in April 1977. We find that the first time the McLanes reasonably could be said to have discovered the alleged malpractice, i.e., the failure to sever the joint tenancy between the Shugart sisters, was after Grace's death and during the subsequent probate of her estate in 1977. ...


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