Brocato v. Prairie State Farmers Ins. Ass'n

• Decision Date: 09 March 1988
• Docket Number: No. 4-87-0641,4-87-0641
• Parties: , 117 Ill.Dec. 849 Frank BROCATO, Plaintiff-Appellant, v. PRAIRIE STATE FARMERS INSURANCE ASSOCIATION; Ackman, Marek, Boyd and Simutis, Ltd., a Professional Corporation; and Frank J. Simutis, Defendants-Appellees.
• Court: United States Appellate Court of Illinois

Page 1200

520 N.E.2d 1200

166 Ill.App.3d 986, 117 Ill.Dec. 849

Frank BROCATO, Plaintiff-Appellant, v. PRAIRIE STATE FARMERS INSURANCE ASSOCIATION; Ackman, Marek Boyd and Simutis, Ltd., a Professional Corporation; and Frank J. Simutis Defendants-Appellees.

No. 4-87-0641.

Appellate Court of Illinois Fourth District.

March 9, 1988.

Paul R. Wilson, Jr., Wilson Law Office, P.C., Rantoul, for plaintiff-appellant.

Donald F. Hemmesch, Jr., Dean M. Athans, Taslitz, Smith & Hemmesch, Chicago, for Prairie State Farmers Ins.

Thomas & Hinshaw, Culbertson, Chicago (D. Kendall Griffith, David E. Jones, Kathryn A. Spalding, of counsel) for Ackman, Marek, Boyd & Simutis, Ltd. and Frank Simutis.

Justice KNECHT delivered the opinion of the court:

Plaintiff Frank Brocato filed a personal injury action against Bruce Strough and received a jury verdict of $375,000. Strough then assigned to plaintiff his causes of action against defendants Prairie State Farmers Insurance Association, Frank J. Simutis, and Ackman, Marek, Boyd and Simutis, Ltd., his insurance carrier and the lawyer and law firm retained by the carrier to defend him against plaintiff's personal injury claim. On May 15, 1987, plaintiff filed suit against defendants in the circuit court of Champaign County claiming the carrier had breached its contractual duties to assignor Strough as well as negligently, wilfully and wantonly, and intentionally failed to provide or adequately control Strough's defense or consider his interests equally with its own. Plaintiff alleged the attorneys committed legal malpractice in the handling of Strough's defense. All three defendants filed motions to dismiss for failure to state a cause of action which were granted on September 8, 1987. Plaintiff appeals the dismissals and we affirm.

Plaintiff and Strough were apparently involved in an automobile collision on May 29, 1982, in which plaintiff suffered personal injuries. At that time Strough had a family automobile policy with defendant carrier. The policy had limits of $50,000 per person for bodily injury. Defendant carrier maintains, pursuant to its contractual obligations to Strough, it investigated the accident and attempted to settle with plaintiff by offering its policy limits. Plaintiff does not deny this contention. Plaintiff declined the offer and filed suit against Strough on June 28, 1983. Defendant carrier retained defendant attorneys to represent Strough. A judgment was later entered against Strough in the amount of $375,000. On May 2, 1987, Strough assigned his claims against the defendants to plaintiff. This suit was commenced shortly thereafter.

Plaintiff's complaint against both the attorneys and the carrier failed to state a cause of action. As to the legal malpractice claims against the attorneys who defended Strough, Illinois courts have determined a cause of action for legal malpractice is not assignable because of the personal nature of the attorney-client relationship and the potential for abuse. (Clement v. Prestwich ) (1983), 114 Ill.App.3d 479, 480-81, 70 Ill.Dec. 161, 163, 448 N.E.2d 1039, 1041; Christison v. Jones (1980), 83 Ill.App.3d 334, 338-39, 39 Ill.Dec. 560, 562, 405 N.E.2d 8, 11.) In finding that the assignment of a cause of action for legal malpractice offended public policy the courts in Clement and Christison cited to the lengthy discussion of the complications of permitting such assignments contained in Goodley v. Wank & Wank, Inc. (1976), 62 Cal.App.3d 389, 133 Cal.Rptr. 83. The discussion in Goodley included the following persuasive observations:

"The assignment of such claims could relegate the legal malpractice action to the market place and convert it to a commodity to be exploited and transferred to economic bidders who have never had a professional relationship with the attorney and to whom the attorney has never owed a legal duty, and who have never had any prior connection with the assignor or his rights. The commercial aspect of assignability of choses in action arising out of legal malpractice is rife with probabilities that could only debase the legal profession. The almost certain end result of merchandizing such causes of action is the lucrative business of factoring malpractice claims which would encourage unjustified lawsuits against members of the legal profession, generate an increase in legal malpractice litigation, promote champerty and force attorneys to defend themselves against strangers. The endless complications and litigious intricacies arising out of such commercial activities would place an undue burden on not only the legal profession but the already overburdened judicial system, restrict the availability of competent legal services, embarrass the attorney-client relationship and imperil the sanctity of the highly confidential and fiduciary relationship existing between attorney and client." 62 Cal.App.3d 389, 397, 133 Cal.Rptr. 83, 87.

Although in his complaint plaintiff proceeded on the theory that his cause of action was brought as an assignment of Strough's legal malpractice claims against defendant attorneys, plaintiff also argues that the decision in Pelham v. Griesheimer (1982), 92 Ill.2d 13, 64 Ill.Dec. 544, 440 N.E.2d 96, allows a nonclient to bring a malpractice suit against an attorney. Pelham did not deal with the assignability of such a claim but held that an attorney could owe a duty to a nonclient under the limited circumstance where "the primary purpose and intent of the attorney-client relationship itself was to benefit or influence the third party." (92 Ill.2d 13, 21, 64 Ill.Dec. 544, 548, 440 N.E.2d 96, 100.) It is difficult to see how the relationship between Strough and his attorneys was meant to benefit plaintiff and, indeed, it has been held that the opposing party to a lawsuit does not fall within the scope of the duty outlined in Pelham. (Doyle v. Shlensky (1983), 120 Ill.App.3d 807, 812, 76 Ill.Dec. 466, 471-72, 458 N.E.2d 1120, 1125-26.) Therefore, we hold the trial court properly dismissed the counts of plaintiff's complaint directed against the defendant attorneys.

The counts directed against the defendant carrier are more complicated. A cause of action against insurance carriers for bad faith in failing to settle within policy limits has been recognized as assignable in Illinois. (Brown v. State Farm Mutual Automobile Insurance Association (1971), 1 Ill.App.3d 47, 272 N.E.2d 261.) It may be argued that a cause of action for an insurance carrier's wrongful refusal to provide a defense to its insured is also assignable. A carrier's failure to settle in good faith and...