Ores v. Kennedy, 1-89-2598

• Decision Date: 26 August 1991
• Docket Number: No. 1-89-2598,1-89-2598
• Citation: 161 Ill.Dec. 493,578 N.E.2d 1139,218 Ill.App.3d 866
• Parties: , 161 Ill.Dec. 493 Richard ORES and Harriet Sproull, co-executors of the Estate of Ronald E. Sproull, deceased, and Harriet Sproull, individually, Plaintiffs, v. Philip KENNEDY and Vedder, Price, Kaufman & Kammholz, a partnership including professional corporations, Defendants, Third Party Plaintiffs-Appellants (Alvin J. Golden, Third Party Defendant-Appellee).
• Court: United States Appellate Court of Illinois

Page 1139

578 N.E.2d 1139

218 Ill.App.3d 866, 161 Ill.Dec. 493

Richard ORES and Harriet Sproull, co-executors of the Estate

of Ronald E. Sproull, deceased, and Harriet

Sproull, individually, Plaintiffs, v. Philip KENNEDY and Vedder, Price, Kaufman & Kammholz, a

partnership including professional corporations, Defendants,

Third Party Plaintiffs-Appellants (Alvin J. Golden, Third

Party Defendant-Appellee).

No. 1-89-2598.

Appellate Court of Illinois,

First District, First Division.

Aug. 26, 1991.

Phelan, Pope & John, Ltd., Chicago (Donald B. Hilliker, Stanley V. Figura, of counsel), for plaintiffs-appellants.

Hinshaw, Culbertson, Moelmann, Hoban & Fuller, Chicago (George W. Spellmire, Jr., Nancy G. Lischer, Caroline A. Mondschean, of counsel), for appellee Alvin J. Golden.

Justice O'CONNOR delivered the opinion of the court:

Plaintiffs, Richard Ores and Harriet Sproull acting as executors of Ronald Sproull's estate, sued Philip Kennedy and the law firm of Vedder, Price, Kaufman & Kammholz (Vedder Price) for alleged legal malpractice. Subsequently, Kennedy and Vedder Price, Illinois attorneys, acting as third party plaintiffs sought contribution and filed a third party complaint against Alvin Golden, a Texas attorney. The trial court dismissed the third party plaintiffs' complaint against Golden for lack of personal jurisdiction. The third party plaintiffs appeal the dismissal.

Third party plaintiff Kennedy is a member of the third party plaintiff law firm Vedder Price. The third party plaintiffs prepared decedent Ronald Sproull's will and trust agreement when the decedent was an Illinois resident. After the decedent's will was executed, he moved to Texas. Subsequently, on October 19, 1982, Ronald Sproull died in a plane crash. Harriet Sproull, the decedent's widow and a Texas resident, was named as an executor. Additionally, Ores, an Illinois resident, was named as an executor. Ores acted as the family's accountant and financial advisor. Between December 1982 and November 1983, the executors sold approximately 625,000 shares of Tellab stock which was worth over $18,000,000.

After selling the Tellabs stock, the executors filed a legal malpractice complaint against the third party plaintiffs alleging that the third party plaintiffs negligently drafted decedent Ronald Sproull's will and trust agreement which allegedly caused Ronald Sproull's estate to incur approximately $1,500,000 excess tax liability.

Subsequently, the third party plaintiffs filed a third party complaint against Golden for contribution. The third party plaintiffs alleged that Golden negligently advised the executors to sell the Tellabs stock. Specifically, the third party plaintiffs contended that Golden failed to read and consider the will and trust agreements, that Golden failed to structure the stock sale to minimize the estate's tax liability and that the estate would not have incurred the alleged excess tax liability if the Tellabs stock was not sold.

Pursuant to the Illinois long-arm statute (Ill.Rev.Stat.1987, ch. 110, par. 2-209), Golden was purportedly served in Texas. Subsequently, Golden filed a motion to quash and dismiss the service of summons alleging that the Illinois trial court lacked personal jurisdiction. Golden's affidavit was included with his motion to quash and dismiss.

Golden's affidavit stated the following: He is a citizen and resident of Texas. While he is licensed to practice law in Texas, he is not licensed in Illinois. On or about November 4, 1982, Golden was contacted by Charles Wiggins, a Vedder Price attorney. Wiggins informed him that Harriet Sproull and Ores had been named co-executors of Ronald Sproull's estate, that "Ronald and Harriet Sproull were Texas residents, with property in Texas, and that as a result, it was necessary to retain Texas counsel to have the estate admitted to probate in Texas." Between November 4 and November 11, 1982, Harriet Sproull contacted Golden to discuss the estate. After Golden spoke with Harriet Sproull and before November 15, 1982, Ores called Golden. On or about November 15, 1982, the executors retained Golden for the purpose of admitting the decedent's will and trust agreement to probate in Texas. Golden admitted that between November 9, 1982 and January 1984, he corresponded and had telephone conversations with Ores, with attorneys at Vedder Price and with the trust department at the First National Bank of Chicago. He never met with Ores or Harriet Sproull in Illinois. All of his activity on behalf of the estate occurred in Texas. He never traveled to Illinois for any reason connected with his representation of the estate.

In response to Golden's motion to quash and dismiss the service of summons, the third party plaintiffs introduced Golden's billing records as evidence of Golden's contacts with Illinois. The third party plaintiffs introduced the following evidence. Golden participated in conference calls with Ores on December 3, 6, 15 and 23 of 1982 concerning the estate's sale of Tellabs stock. Golden also participated in telephone conferences with Ores on January 12, 14, 19, 20, March 10 and May 4 of 1983 concerning the estate's sale of Tellabs stock. In a June 2, 1983, letter and a June 14, 1983, conference call, Golden sought advice from third party plaintiff Kennedy and Wiggins, Vedder Price attorneys, regarding the estate's tax liability as a consequence of the stock sale. Golden also had similar telephone calls with Wiggins on June 29, and July 18, 1982.

Additionally, the third party plaintiffs introduced the following: On July 27, August 8 and September of 1983, Golden participated in telephone conversations with Ores regarding investments and the Tellabs stock. On July 25 and 26, 1983, Golden sent a letter by Federal Express to the Continental Bank in Chicago regarding letters necessary to complete a stock transfer. Furthermore, there were other telephone conversations and correspondences between Golden and Ores.

On August 25, 1989, after hearing Golden's motion to quash and dismiss the service of summons and the evidence introduced by the third party plaintiffs, the trial court granted Golden's motion to quash and dismiss on the grounds that Golden's activities were insufficient to confer jurisdiction on Illinois courts, relying on the Illinois long-arm statute (Ill.Rev.Stat.1987, ch. 110, par. 2-209.) The long-arm statute provided, in relevant part, the following:

"(a) Any person, whether or not a citizen or resident of this State, who in person or through an agent does any of the acts hereinafter enumerated, thereby submits such person, and if an individual, his or her personal representative, to the jurisdiction of the courts of this State as to any cause of action arising from the doing of any such acts:

(1) The transaction of any business within this State (2) The commission of a tortious act within this State." (Ill.Rev.Stat.1987, ch. 110, par. 2-209.)

In 1989, an amendment to the long-arm statute became effective. (Ill.Rev.Stat.1989, ch. 110, par. 2-209 amended by Pub.Act 86-840.) The amended long-arm statute specifically provides that Illinois courts "may also exercise jurisdiction on any other basis now or hereafter permitted by the Illinois Constitution and the Constitution of the United States." Ill.Rev.Stat.1989, ch. 110, par. 2-209(c).

The third party plaintiffs appeal the dismissal of their complaint, asserting that the Illinois courts can assert personal jurisdiction over Golden pursuant to the amended long-arm statute. In particular, the third party plaintiffs argue that the amended long-arm statute should be applied retroactively to validate the service upon Golden and, thus, contend that Illinois courts have personal jurisdiction over Golden. We agree. Additionally, we are not persuaded that Golden must be served again because the original service gave him notice of the complaint and allowed him sufficient opportunity to prepare his defense.

The third party plaintiffs correctly argue that the amended long-arm statute applies retroactively, contending that the presumption of prospectivity is rebutted because "the Illinois long-arm statute merely specifies a procedure for enforcing existing rights." While the general rule is that statutory changes are presumed to be prospective, the presumption of prospectivity can be rebutted by demonstrating that the amendment merely affects procedural matters. (Young v. Chicago Transit Authority (1990), 209 Ill.App.3d 84, 89, 154 Ill.Dec. 18, 568 N.E.2d 18, appeal denied (1991), 139 Ill.2d 606, 159 Ill.Dec. 118, 575 N.E.2d 925, citing Rivard v. Chicago Fire Fighters Union, Local No. 2 (1988), 122 Ill.2d 303, 309-310, 119 Ill.Dec. 336, 522 N.E.2d 1195, cert. denied (1988), 488 U.S. 909, 109 S.Ct. 262, 102 L.Ed.2d 250.) A procedural change in law generally prescribes methods of enforcing rights and embraces pleading, evidence and practice, i.e., legal rules which direct the means to bring parties into court or the manner in which the court process shall proceed. It facilitates suit against a party. (See Young v. Chicago Transit Authority (1990), 209 Ill.App.3d 84, 93, 154 Ill.Dec. 18, 568 N.E.2d 18.) In contrast, a substantive change in law establishes, creates, defines or regulates rights, and thus could actually "make one a party to a suit." (Rivard, 122 Ill.2d at 310-11, 119 Ill.Dec. 336, 522 N.E.2d 1195 quoting Ogdon v. Gianakos (1953), 415 Ill. 591, 114 N.E.2d 686.) In the case at bar, the amended long-arm statute was certainly not part of the law which creates, defines, or regulates rights and is not what makes one a party to a suit. See Ogdon, 415 Ill. at 596, 114 N.E.2d 686.

In support of their contention that the amendment is procedural, the third party plaintiffs correctly rely on Nelson v. Miller (1957), 11 Ill.2d 378, 143 N.E.2d 673 and Sunday v. Donovan (1958), 16 Ill.App.2d 116, 147 N.E.2d 401. In Miller, the court applied the original long-arm statute retroactively...