The Workers' Compensation Commission's authority over attorney fees did not extend to a common law action for breach of contract arising from defendant attorney's refusal to pay over to plaintiff law firm the percentage of Commission-approved fees which defendant had agreed to share pursuant to a referral agreement, and his motion to dismiss for lack of subject matter jurisdiction in the circuit court was properly denied.
Michael D. Furlong and Peter M. Trobe, of Trobe, Babowice & Associates LLC, of Waukegan, for appellant.
Saul M. Ferris, of Ferris, Thompson & Zweig, Ltd., of Gurnee, for appellee.
Lisa Madigan, Attorney General, of Springfield (Carolyn E. Shapiro, Solicitor General, and Stephen M. Soltanzadeh, Assistant Attorney General, of Chicago, of counsel), for amicus curiae Illinois Workers' Compensation Commission.
JUSTICE KILBRIDE delivered the judgment of the court, with opinion. Chief Justice Garman and Justices Freeman, Thomas, Karmeier, Burke, and Theis concurred in the judgment and opinion.
[¶1] In this case, we consider whether the circuit court has subject matter jurisdiction
to resolve a dispute based on a referral agreement apportioning attorney fees earned in a claim filed under the Workers' Compensation Act (Act) (820 ILCS 305/1 et seq. (West 2012)). The circuit court of Lake County held it had subject matter jurisdiction to decide this case, and the appellate court affirmed the circuit court's judgment. 2014 IL App. (2d) 130129, 378 Ill.Dec. 754, 4 N.E.3d 1126. For the following reasons, we hold that the circuit court has subject matter jurisdiction to consider this attorney fee dispute.
[¶2] I. BACKGROUND
[¶3] Plaintiff, Ferris, Thompson & Zweig, Ltd., filed a complaint in the circuit court of Lake County alleging two counts of breach of contract. Plaintiff alleged that it and defendant, Anthony Esposito, " agreed to act as co-counsel in the legal representation of" two women with respect to their workers' compensation claims. Under the contracts, plaintiff was to receive 45% of the attorney fees recovered in the two cases and defendant would receive the remaining 55% of the fees. After the cases were settled, defendant refused to pay plaintiff its share of the attorney fees.
[¶4] Plaintiff attached to its complaint a separate attorney-client agreement for each count. The agreements, signed by plaintiff, defendant, and the clients, stated that the clients had retained plaintiff and understood that plaintiff had " contracted with [defendant] to pursue this workers' compensation claim on [their] behalf." The clients understood and agreed that plaintiff would have certain responsibilities and would receive a portion of the attorney fees on the workers' compensation claims.
[¶5] Under the agreements, plaintiff was required to: (1) assist defendant with initial interviews and document preparation for the claims; (2) assist defendant with " client contact and communication" when necessary; (3) provide translation services when necessary; (4) represent the clients in " any related third party action" ; and (5) keep a duplicate file in its office containing correspondence and filings associated with the claims. Defendant was required to: (1) prepare documents and obtain records necessary to process the claims; (2) represent the clients before the Commission, including conducting any investigation, negotiation, and processing necessary to resolve the claims; and (3) send status reports to plaintiff " every sixty days or as significant developments occur in connection with the handling of the claim."
[¶6] Plaintiff also attached to its complaint a letter it received from defendant in each case. In the letters, defendant confirmed that plaintiff was retained for legal representation in the two workers' compensation cases. Defendant stated the parties had agreed that the cases were " referred to [defendant's] office and [plaintiff] will also undertake representation" of the clients. Defendant also reiterated the responsibilities of each party and the division of attorney fees.
[¶7] Defendant filed a section 2-619 motion to dismiss the complaint, asserting that the circuit court lacked subject matter jurisdiction to consider plaintiff's claims. Defendant stated that under section 16a(J) of the Act (820 ILCS 305/16a(J) (West 2012)), " [a]ny and all disputes regarding attorney's fees," including disputes on division of fees when the claimant has been represented by more than one attorney and disputes on contracts for attorney fees, " shall be heard and determined by the Commission." Defendant contended the Commission must resolve plaintiff's claims because they involve a dispute about attorney fees in a workers' compensation case.
[¶8] The circuit court found plaintiff's complaint sought recovery based on a ...