Hernandez v. Pritikin

• Decision Date: 13 December 2012
• Docket Number: No. 113054.,113054.
• Parties: Jesse E. HERNANDEZ, et al., Appellees, v. Jeffrey PRITIKIN, Special Representative of the Estate of Isadore Bernstein, Deceased, et al., Appellants.
• Court: Illinois Supreme Court

2012 IL 113054

981 N.E.2d 981

367 Ill.Dec. 253

Jesse E. HERNANDEZ, et al., Appellees,

v.Jeffrey PRITIKIN, Special Representative of the Estate of Isadore Bernstein, Deceased, et al., Appellants.

No. 113054.

Supreme Court of Illinois.

Dec. 13, 2012.

Matthew R. Henderson, Timothy G. Shelton, Hinshaw & Culbertson LLP, Donald J. Brown, Jr., Karen Kies DeGrand, Donohue Brown Mathewson & Smyth LLC, Chicago, IL, for appellants.

Donald L. Johnson, Julie A. Boynton and Joseph T. Gentleman, Chicago, IL, for appellees.

Elliot R. Schiff, Schiff Gorman LLC, David R. Nordwall, Chicago, IL, for amicus curiae Illinois Trial Lawyers Association.

OPINION

Justice KARMEIER delivered the judgment of the court, with opinion.

[367 Ill.Dec. 254]¶ 1 The overarching issue in this appeal is whether the circuit court of Cook County erred in dismissing plaintiffs' refiled legal malpractice action as barred by res judicata. The appellate court held that it did. 2011 IL App (1st) 102646, 353 Ill.Dec. 696, 956 N.E.2d 558. We allowed defendants' petition for leave to appeal. Ill. S.Ct. R. 315 (eff. Feb. 26, 2010). Because the defendants, as the parties seeking to invoke the doctrine of res judicata, have not borne their burden of proving a final judgment was entered for purposes of the doctrine's application, we affirm the judgment of the appellate court.

¶ 2 BACKGROUND

¶ 3 The facts that follow are taken from the parties' pleadings, orders of record, and the transcripts that have been provided as part of the record on appeal. For a better understanding of the case, we offer a preliminary chronology of principal events, based on facts that appear to be uncontested. Jesse Hernandez, the plaintiff claiming to have been physically injured/disabled, worked for Central Steel & Wire Company from May of 1968 through March of 1995. He developed physical problems in the early 1990s, and was ultimately diagnosed with Parkinson's disease. For a period of time from 1995 to 1996, he was represented by the law firm of Spector & Lenz, which filed a social security disability claim on his behalf. In early 1999, he met with the defendant attorneys herein, who, in March of 1999, filed a workers' compensation claim for him. They continued representing him into late 2002. The application for adjustment of claim that defendants filed on Jesse's behalf indicated that he had been “exposed to chemicals” and the nature of his injury was “to be proven.” In 2004, Jesse retained new attorneys, who filed an action in the circuit court against various companies claimed to have been responsible for the manufacture and sale of chemicals contributing to his physical injury/disability. When that action was dismissed as time-barred, plaintiffs filed a legal malpractice action against the defendants in this case. The action at issue here is a case refiled in 2009, after the original action—filed in 2005—was voluntarily dismissed by plaintiffs. With that overview, we discuss more fully the original legal malpractice action filed against these defendants in 2005.

¶ 4 In 2005, plaintiffs, Jesse and Yolanda Hernandez, filed a legal malpractice action against Jesse's former attorneys, defendants Isadore Bernstein, John L. Grazian, Richard S. Volpe, and Bernstein and Grazian, P.C., a professional corporation engaged in the practice of law. In their initial complaint, the plaintiffs alleged that Jesse hired defendants in 1999 to represent him with respect to injuries he sustained at work. In that complaint, plaintiffs specified that “Jesse * * * suffers from Parkinson's disease caused by the injuries at work.” Plaintiffs claimed that defendants owed them a duty “to inform them of all potential claims and causes of action they possessed or which might arise from the injuries in question.” As noted, in March of 1999, the defendants filed a workers' compensation application for Jesse.

¶ 5 Notwithstanding, plaintiffs alleged that defendants were negligent insofar as they: (a) failed to advise plaintiffs that they might have claims against parties other than Jesse's employer to recover for the injuries Jesse suffered at work; (b) failed to file an action against others who had contributed to the events and conditions which caused injuries to Jesse; and/or (c) failed to advise plaintiffs that they needed to retain other counsel to file an action against others who had contributed to the events and conditions which caused injuries to Jesse.

¶ 6 Plaintiffs stated that they first learned from new attorneys, in 2004, that a claim could have been made against parties other than Jesse's employer for his injuries. Plaintiffs' new attorneys took over the handling of Jesse's workers' compensation claim, and also filed an action in the circuit court against several companies claimed to have contributed to “the events and conditions which caused the injuries.” The action against those companies—based on theories of strict liability and negligence—was dismissed on August 12, 2005, as time-barred—Judge Kathy Flanagan finding: “ The evidence here shows that Plaintiff here clearly was possessed of sufficient knowledge to put him on notice that he was injured and that his injury was wrongfully caused in 1999 when he filed his original Adjustment of Claim. It was incumbent upon him to then investigate further.” Judge Flanagan's dismissal prompted the legal malpractice action against these defendants, the theory being that if plaintiffs were on notice as of that date that actions might be filed against parties other than Jesse's employer, so were these defendants. In their complaint, plaintiffs claimed, but for the negligence of these defendants, they would have had “good, valid and valuable causes of action” and would have “in timely manner” “prosecuted those actions to final judgment or settlement.”

¶ 7 Defendants moved to dismiss plaintiffs' complaint, arguing, inter alia, that the statute of limitations had run on plaintiffs' product liability claim before defendants were retained as Jesse's attorneys.

¶ 8 A hearing on defendants' motion was held on August 7, 2006, before Judge Donald Suriano. At that hearing, the parties initially focused on the significance of Judge Flanagan's finding in the dismissed product liability action that Jesse was on inquiry notice as of the filing of his application for workers' compensation in March of 1999 that his injuries might have been wrongfully caused by parties other than his employer, i.e., that the statute of limitations for a personal injury or product liability action (735 ILCS 5/13–202, 13–213 (West 1998) (two-year limitation periods)) began to run, at least, by that date.

¶ 9 In the end, however, Judge Suriano concluded that Jesse was on inquiry notice, for purposes of the personal injury and product liability statutes of limitation, much earlier than was reflected by Judge Flanagan's ruling. Judge Suriano stated: “I guess, I'm going to say the statute of limitations began to run, at the latest, his last day of employment, which in [ sic ] '95. According to those numbers then, the defendant should prevail on his motion, right? Am I right?”

¶ 10 Counsel for plaintiff conceded that the judge was correct with respect to the allegations of the original complaint, but counsel asked for, and was granted, leave to file an amended complaint, adding allegations that defendants were negligent for failing to file a malpractice suit against the Spector law firm for failing to file a product liability action on plaintiffs' behalf.

¶ 11 The ensuing written order, signed by Judge Suriano, and filed August 7, 2006, simply states that the “Defendants' motion to dismiss is granted,” that “plaintiffs are given 30 days to file an amended complaint or until September 7, 2006,” and that “Defendants are given 28 days to answer or otherwise plead or by October 5, 2006.” The word “prejudice” does not appear in the order of dismissal; nor is there any indication that plaintiffs were precluded from pursuing any particular theory in support of recovery.

¶ 12 The amended complaint ultimately filed by plaintiffs added factual allegations to support the alternative theory that defendants were also negligent insofar as they failed to advise plaintiffs of the possibility of a legal malpractice action against the law firm of Spector & Lenz “for failing to file a claim against [Jesse's] employer or third parties as alleged in the lawsuit discussed below and/or failing to advise Jesse and Yolanda to seek counsel with respect to those claims before the statute of limitations expired on those claims.” The amended complaint retained the allegations of the original complaint that the defendants herein breached the duties they owed plaintiffs when they: (a) failed to advise plaintiffs that they might have claims against parties other than Jesse's employer to recover for the injuries Jesse suffered at work; (b) failed to file an action against others who had contributed to the events and conditions which caused injuries to Jesse; and (c) failed to advise plaintiffs that they needed to retain other counsel to file an action against others who had contributed to the events and conditions which caused injuries to Jesse.

¶ 13 The complaint added significant factual allegations apparently aimed at establishing a basis for application of the discovery rule so as to lengthen the statutory period in which plaintiffs could have filed the underlying product liability action. Application of the discovery rule obviously had the potential to make the suit against defendants under the theory of the original complaint timely. We cite some examples of these added allegations.

¶ 14 Plaintiffs alleged that during Jesse's employment with Central Steel & Wire Company, “he was not told by anyone employed by CS & WC, nor did he know or learn from any other source, that he was, or was maybe, being exposed to harmful or potentially harmful fumes, dust or other emissions from the process of burning/cutting...