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Mann v. Rowland

August 06, 2003

SCOTT MANN, PLAINTIFF,
v.
FRANK ROWLAND AND CAMPANIA MANAGEMENT, DEFENDANTS. CAMPANIA MANAGEMENT COMPANY, INC., THIRD-PARTY PLAINTIFF/COUNTER-PLAINTIFF/APPELLANT,
v.
FRANK ROWLAND AND ROOKS, PITTS & POUST, THIRD-PARTY DEFENDANTS/COUNTER-DEFENDANTS/ APPELLEES.



APPEAL FROM THE CIRCUIT COURT OF COOK COUNTY. HONORABLE PETER A. FLYNN, JUDGE PRESIDING.

The opinion of the court was delivered by: Justice Wolfson

UNPUBLISHED

Res Judicata is a Latin phrase meaning "a thing adjudicated." Black's Law Dictionary 1312 (7th ed. 1999). That is what we have in this case.

Scott Mann filed suit against Campania Management Company, Inc. (Campania), seeking to recover amounts due to him under a settlement agreement to which Campania was a party. Campania, in turn, brought malpractice claims against Rooks, Pitts & Poust (Rooks Pitts) and Frank Rowland (Rowland), who were responsible for drafting the settlement agreement that exposed Campania to liability.

Rooks Pitts and Rowland filed section 2-619 motions to dismiss the claims against them, contending the doctrines of res judicata and collateral estoppel barred the actions and that Campania had ratified the settlement agreement. The trial court granted the motions to dismiss.

On appeal, Campania urges us to reverse the decision of the trial court. Campania contends the doctrines of res judicata and collateral estoppel do not apply here and it did not ratify the settlement agreement. Because we find the claims raised by Campania were barred by the doctrine of res judicata, we do not reach the issues of collateral estoppel or whether Campania ratified the settlement. We affirm the judgment of the trial court.

BACKGROUND

According to the pleadings and exhibits filed in this case, Scott Mann suffered injuries as a result of the condition of a wheelchair sold and maintained by Metropolitan Rehabilitation Services, Inc. (Metropolitan). Mann filed suit against Metropolitan and the manufacturer of the wheelchair. Scott Mann v. Quickie Designs, Inc., No. 94 L 13344 (Mann).

Metropolitan was insured by Credit General Insurance Company (CGI). Campania, the claims manager for CGI, retained Rooks Pitts to represent Metropolitan. Frank Rowland, a partner at Rooks Pitts, handled the case.

In August 1999, Mann settled with Metropolitan. Rowland and Rooks Pitts drafted the settlement agreement and included Campania as a party to the settlement. Mann agreed to release Metropolitan and its insurers, who were undisclosed in the agreement. In return, Campania would pay Mann $175,000 and purchase an annuity that would provide payments of $50,000 annually for seven consecutive years beginning in 2000.

Campania made the initial payment of $175,000 and a second payment of $50,000 to Mann. According to Campania, the money for the payments came from CGI.

Although the record is not clear as to precisely when, it appears that after these two initial payments were made, CGI filed for bankruptcy. No further payments were made to Mann, and Campania did not purchase the annuity as required under the agreement. Campania also failed to pay several invoices issued by Rooks Pitts for its work on Mann.

I. THE FEDERAL FEES CASE

Rooks Pitts filed a suit against Campania in the Circuit Court of Cook County contending Campania owed it attorney fees for work Rooks Pitts had performed in Mann. This case was removed to the United States District Court for the Northern District of Illinois.

On January 31, 2001, Campania filed a motion for leave to file a counterclaim. In the proposed counterclaim, made part of this record by stipulation, Campania raised two counts against Rooks Pitts: one for breach of agency contract and one for negligence. In the breach of agency count, Campania contended Rooks Pitts exceeded its authority when it drafted the settlement agreement naming Campania as a party, thereby exposing Campania to liability. In the negligence count, Campania contended Rooks Pitts should have learned that CGI was the real client and should not have named Campania in the settlement agreement. In its response to this motion, Rooks Pitts contended, among other things, the motion should be denied because Campania could raise these claims in this state court action.

The district court denied the motion, stating "Defendant's duplicative motion for leave to file a new counterclaim after discovery has closed *** is denied." The court subsequently entered judgment in favor of Rooks Pitts for fees. The Seventh Circuit Court of Appeals affirmed this decision, addressing specifically the trial court's decision to deny Campania's motion for leave to file the counterclaim. Campania Management Co. v. Rooks Pitts & Poust, 290 F.3d 843 (7th Cir. 2002).

II. THE FEDERAL MALPRACTICE CASE

On June 15, 2000, Campania filed suit against Rooks Pitts and Rowland in the Circuit Court of Cook County, contending the attorneys committed malpractice in the handling of Mann by, among other things, failing to have the products claim dismissed, failing to file an indemnity claim against the manufacturer, and failing to prepare for the possibility that the manufacturer would settle with Mann. Campania alleged it ultimately had to pay $500,000 to settle Mann where, "but for the attorney defendants' negligence, it should have paid nothing." This case was also removed to the United States District Court for the Northern District of Illinois.

Campania filed a motion to voluntarily dismiss the federal court suit without prejudice. The court's January 31, 2001, order stated, "Plaintiff's motion to voluntarily dismiss *** is granted in part. This case is dismissed with prejudice as to the named defendants." (Emphasis added.) Campania tried, unsuccessfully, to have the district court either modify its order to grant dismissal without prejudice or, in the alternative, reinstate the case.

III. THE PRESENT CASE

On January 24, 2001, Mann filed this suit in the Circuit Court of Cook County against Rowland and Campania to recover the remaining payments due under the settlement agreement. According to Mann's complaint, Campania and Rowland were responsible for the unpaid portion of the settlement agreement.

In March, Campania filed a counterclaim against Rowland and a third-party complaint against Rooks Pitts. In each, Campania brought three identical counts. In Count I, a breach of agency contract claim, Campania contended Rowland and Rooks Pitts exceeded the authority given to them when they added Campania as a party to the settlement agreement. Count II alleged Rowland and Rooks Pitts were negligent for adding Campania instead of the real client, CGI, to the settlement agreement. These two counts were the same as the claims raised in Campania's proposed counterclaim in the federal fees case. Count III alleged Rooks Pitts and Rowland were negligent in various other aspects of the defense of Metropolitan in Mann, including failure to have the products case against Metropolitan dismissed, failure to file an indemnity claim against the manufacturer, and failure to prepare for the possibility that the manufacturer would settle with Mann. According to Campania, but for this negligence it would not have had to pay $500,000 to Mann. Count III is nearly identical to the claim raised by Campania in the federal malpractice action.

In April 2001, Rowland and Rooks Pitts filed 2-619 motions to dismiss Campania's claims against them contained in the counterclaim and the third party complaint. The trial court granted the motions. *fn1

DECISION

We review de novo a trial court's dismissal of an action under section 2-619 of the Illinois Code of Civil Procedure, 735 ILCS 5/2-619 (West 2002). Nowak v. St. Rita High ...


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