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Enviorment Control Systems, Inc. v. Long

December 09, 1998

ENVIRONMENTAL CONTROL SYSTEMS, INC., J. DOUGLAS ANDREWS, ERIC ANDREWS, AND JOEL ANDREWS, PLAINTIFFS-APPELLANTS,
v.
J. THOMAS LONG AND FARRELL LAW FIRM, P.C., DEFENDANTS-APPELLEES.



Appeal from the Circuit Court of Madison County. No. 95-L-1554

The opinion of the court was delivered by: Justice Kuehn

IN THE APPELLATE COURT OF ILLINOIS FIFTH DISTRICT

Honorable George J. Moran, Judge, presiding.

The case within this legal malpractice case involves the Illinois Environmental Protection Act (Ill. Rev. Stat. 1989, ch. 111½, par. 1001 et seq.). The alleged malpractice occurred at both the county board and appellate court levels. Environmental Control Systems, Inc. (ECS), and J. Douglas Andrews, Eric Andrews, and Joel Andrews appeal from three trial court rulings. *fn1 ECS is an Illinois corporation that was developing a recycling center and sanitary landfill otherwise known as a regional pollution control facility (RPCF). J. Douglas Andrews, Eric Andrews, and Joel Andrews are ECS's shareholders and officers. These three orders completely dispensed with plaintiffs' case. We affirm in part, reverse in part, and remand.

From 1990 through 1995, attorney J. Thomas Long and the Farrell Law Firm, P.C., *fn2 represented ECS in its attempts at obtaining a siting permit for the proposed RPCF. Defendants also represented the Andrews in their individual capacities as shareholders. The Andrews were attempting to sell their ECS shares. Sale of the shares was contingent upon obtaining RPCF approval during the siting process.

The statutory process to obtain siting approval for an RPCF requires the approval of the Madison County Board. Ill. Rev. Stat. 1989, ch. 111½, par. 1039.2(a). Prior to obtaining the Madison County Board's approval, the applicant must publish notice of intent to seek approval. Ill. Rev. Stat. 1989, ch. 111½, par. 1039.2(b). The applicant must also provide notice of intent to all property owners whose property is located within 250 feet of the lot line at issue. Ill. Rev. Stat. 1989, ch. 111½, par. 1039.2(b). The applicant must submit an application to and participate in a hearing before the county board. Ill. Rev. Stat. 1989, ch. 111½, pars. 1039.2(c), (d). All appeals from the county board's decisions are heard by the Illinois Pollution Control Board. Ill. Rev. Stat. 1989, ch 111½, par. 1040.1(a). Appeals from Illinois Pollution Control Board decisions are heard in the appellate courts. Ill. Rev. Stat. 1989, ch. 111½, par. 1041(a).

The proposed RPCF site was located in Madison County. At the end of May 1990, defendants began the statutory approval process by notifying the required landowners of ECS's intent. Two owners of land within 250 feet of the lot line were not notified.

In July 1990, the Andrews negotiated and executed a contingent stock sale agreement by which they would sell their ECS shares to Community Landfills for more than $2.3 million. This stock sale was made contingent upon ECS's site application approval. The contract provided that 36 days after the Madison County Board approved ECS's site application, Community Landfills would make a partial payment of $410,000 to the Andrews. The contract further provided that 45 days after the Madison County Board's approval, Community Landfills would pay an additional $100,000. However, if an appeal was taken from the Madison County Board's site application approval, no partial payments would be made.

The Madison County Board approved ECS's application on November 14, 1990, despite ECS's failure to notify the two landowners.

On December 18, 1990, several individuals and a group known as the Madison County Conservation Alliance filed a petition with the Illinois Pollution Control Board (PCB) contesting the Madison County Board's RPCF application approval. This petition alleged that at least one property owner within 250 feet of the proposed RPCF site did not receive the required statutory notice. A hearing was held on April 11, 1991, following which the PCB vacated the November 14, 1990, Madison County Board decision. The PCB vacated the certification expressly because the two landowners did not receive notice of ECS's application.

On April 30, 1991, Community Landfills sent plaintiffs notice that they were in breach of the stock sale agreement because the two landowners did not receive notice.

On May 9, 1991, ECS, through defendants' representation, sought judicial review in this court of the April 11, 1991, PCB ruling. The petition for review named the PCB, the Madison County Conservation Alliance, and eight individuals as respondents. While the Madison County Board was a party to the PCB proceedings, defendants did not include the board as a party to the judicial review. Several issues were raised on appeal, but ECS primarily argued that they were not required to give notice to the two landowners in issue pursuant to section 39.2(b) of the Environmental Protection Act (Ill. Rev. Stat. 1989, ch. 111½, par. 1039.2(b)). Defendants' legal opinion was that section 39.2(b) only required landowner notification with respect to proximity to the RPCF itself. The landowners were not located within 250 feet of the actual RPCF but were within 250 feet of the larger lot line upon which the RPCF was situated. On March 22, 1994, this court dismissed ECS's appeal on the technical jurisdictional basis that ECS failed to name the Madison County Board as a party. Environmental Control Systems, Inc. v. Pollution Control Board, 258 Ill. App. 3d 435, 630 N.E.2d 554 (1994).

On April 26, 1994, ECS filed a petition for leave to appeal with the Illinois Supreme Court. While this petition was pending, ECS president Douglas Andrews consulted with other counsel to determine whether there was anything that could be done to save the site permit process and whether or not ECS had a malpractice claim against defendants. On June 1, 1995, the Illinois Supreme Court denied ECS's petition for leave to appeal. Environmental Control Systems, Inc. v. Pollution Control Board, 162 Ill. 2d 565, 652 N.E.2d 340 (1995).

While the appeal in this court was pending, plaintiffs sought status reports from defendants on four occasions--July 23, 1991, October 21, 1991, November 18, 1991, and December 26, 1991. Defendants first responded to these four requests on December 30, 1991. In that report, defendants assured plaintiffs that there was a "good chance of success" on appeal. On May 25, 1993, after oral argument, counsel advised plaintiffs of their "reasonable opportunity to prevail on the merits." The law firm remained confident despite this court's adverse ruling, relating to plaintiffs in a report dated June 7, 1994, that there was "a good chance that the Supreme Court will take the case ***."

On September 14, 1995, Community Landfills again notified plaintiffs that they were in breach of the stock sale agreement, and ...


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