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Chapman v. Kitzman

February 02, 1999

MORRIS B. CHAPMAN & ASSOCIATES, LTD., PLAINTIFF-APPELLANT AND CROSS-APPELLEE,
v.
JOHN KITZMAN AND EDNA KITZMAN, DEFENDANTS-APPELLEES AND CROSS-APPELLANTS.



Appeal from the Circuit Court of Madison County. No. 93-MR-375 Honorable Ann E. Callis Rongey, Judge, presiding.

The opinion of the court was delivered by: Justice Kuehn

IN THE COURT OF APPEALS OF THE STATE OF ILLINOIS

John W. Kitzman III died in an industrial accident. His wife, Karen, hired Morris B. Chapman & Associates, Ltd. (Chapman), to pursue a wrongful death action. Karen agreed to pay Chapman one-third of any recovery. Chapman recovered $800,000 but was only paid $227,040. This action ensued.

The lawsuit filed on behalf of Karen Kitzman in Missouri named Karen Kitzman and decedent's parents, John and Edna Kitzman, as his heirs. Chapman obtained an $800,000 settlement for the benefit of those heirs, prepared a petition for settlement approval, and noticed a hearing.

A few days prior to the Missouri trial court's hearing on the petition, John and Edna Kitzman retained separate counsel, attorney John A. Kilo. They agreed to pay Kilo one-third of their recovery in excess of $100,000. John and Edna Kitzman intervened and participated in the settlement approval and apportionment hearing.

After the apportionment hearing, the Missouri trial court entered an order distributing 86% of the settlement ($688,000) to Karen Kitzman and 7% ($56,000) each to John and Edna Kitzman. It further ordered that Chapman's fee would consist of one-third of Karen Kitzman's share ($227,040) only, while Kilo would receive one-third of John and Edna Kitzman's share over $100,000 ($4,000). The Missouri trial court based its fee apportionment on section 537.095(4)(2) of the Missouri Revised Statutes, which requires a trial court to order the claimant: "To deduct and pay the expenses of recovery and collection of the judgment and the attorneys' fees as contracted, or if there is no contract, or if the party sharing in the proceeds has no attorney representing him before the rendition of any judgment or settlement, then the court may award the attorney who represents the original plaintiff such fee for his services, from such persons sharing in the proceeds, as the court deems fair and equitable under the circumstances." Mo. Rev. Stat. §537.095.4(2) (1986). The Missouri trial court stated that this provision required it to apportion attorney fees according to the existing contingency contracts for the following reason: "Once separate counsel appear for competing claimants, the statutory language directing payment of attorney's fees `as contracted' must be given full effect."

Chapman filed the instant action in Madison County Circuit Court, seeking additional attorney fees from defendants, John and Edna Kitzman. Chapman's complaint originally consisted of a single quantum meruit count but was later amended to include a second count based upon the common-fund doctrine. The circuit court disposed of the action in an order that:

"granted Chapman's oral motion to dismiss count I.

granted defendants' motion to dismiss count II of Chapman's complaint grounded on the common-fund doctrine's inapplicability to this case.

denied defendants' summary judgment motion based upon the full faith and credit clause of the United States Constitution (U.S. Const., art. IV, §1).

denied defendants' motion for sanctions seeking attorney fees pursuant to Supreme Court Rule 137 (155 Ill. 2d R. 137).

denied Chapman's summary judgment motion, including Chapman's argument that a Judge, rather than a jury, must determine the proper fee award."

On appeal, Chapman attacks the circuit court's dismissal of count II and its denial of summary judgment on the question of how a common- fund-doctrine fee award is determined. Defendants cross-appeal the circuit court's denial of their summary judgment motion and motion for sanctions.

We first address defendants' argument that the circuit court erred in denying their summary judgment motion. Specifically, defendants contend that the full faith and credit clause of the United States Constitution bars this action because the Missouri trial court's fee- apportionment order is res judicata as to Chapman's claim. This contention presents a disputed question of law that ...


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