Tepper v. Henaghan, 1-18-0085
| Decision Date | 22 August 2018 |
| Docket Number | No. 1-18-0085,1-18-0085 |
| Citation | 2018 IL App (1st) 180085 -U |
| Parties | ROBERT R. TEPPER, Plaintiff-Appellant, v. SHEILA HENAGHAN, Defendant-Appellee. |
| Court | United States Appellate Court of Illinois |
NOTICE: This order was filed under Supreme Court Rule 23 and may not be cited as precedent by any party except in the limited circumstances allowed under Rule 23(e)(1).
Appeal from the Circuit Court of Cook County
The Honorable Margaret A. Brennan, Judge Presiding.
¶ 1 Held: Where settlement agreement calling for monthly installment payments provided that defendant's failure to cure default within 10 days of plaintiff sending notice would entitle plaintiff to have judgment entered for the full amount claimed, and defendant mailed check within 10 days which was not received by plaintiff until 3 days after date specified in notice, trial court did not err in denying plaintiff's motion to enforce judgment.
¶ 2 In this appeal, we address whether the trial court erred in denying the plaintiff's motion to enforce a settlement agreement after dismissal in a claim involving unpaid attorney fees. The plaintiff, Robert R. Tepper, is an attorney who represented the defendant, Sheila Henaghan, in several underlying lawsuits involving a limited liability company of which she was a member. The plaintiff also represented Michael Cullen in these lawsuits. The plaintiff sued Cullen in the case for attorney fees, but he voluntarily dismissed all claims against him with prejudice after Cullen filed for bankruptcy.
¶ 3 Pursuant to Illinois Supreme Court Rule 321 (eff. Feb. 1, 1994), the parties have stipulated to providing this court with a limited record on appeal. That record reflects that their underlying claim for attorney fees was settled on March 13, 2013. Three documents were entered into the court file that day: (1) a settlement agreement, (2) a stipulation, and (3) a dismissal order.
¶ 4 The settlement agreement, signed by both plaintiff and defendant, recites that the plaintiff claimed that the defendant owed him $66,958.49 in attorney fees, based on legal services he rendered to her. The defendant denied she owed the plaintiff anything. However, they agreed to compromise their claim for $25,000, plus interest. Of the $25,000 settlement, the first $10,000 was to be paid within ten days of the settlement. The remainder was to be paid in monthly installments, whereby "on or before the first day of each month thereafter, [the defendant] shall pay [the plaintiff] the sum of $300 until the entire amount due, plus interest, shall have been paid in full." Interest accrued at a rate of 3 percent if the defendant was current on the balance, but it could go as high as the lesser of 18 percent or the highest rate permissible by law if the defendant defaulted on the payments.
¶ 5 The settlement agreement further provided that, upon execution of the settlement agreement, the plaintiff's lawsuit seeking attorney fees would be dismissed "without prejudice and with leave to reinstate as more fully set forth below." It then contained the following provision, out of which the dispute at issue arises:
It further provided that if the plaintiff had to send a second or subsequent notice, the defendant would pay an additional $50 late fee to compensate the plaintiff for the administrative expense of sending notice. The settlement agreement provided that notices would be deemed given one day after being sent for next-day delivery by FedEx or similar overnight courier service to the plaintiff's address. It did not, however, contain any similar provision specifying how the plaintiff was to pay the defendant or when such payments would be considered made. Finally, it provided that upon payment in full, the plaintiff would cooperate with the defendant or her attorney to cause the dismissal without prejudice to be changed to a dismissal with prejudice.
¶ 6 The court file also includes a stipulation filed March 13, 2013, signed by the plaintiff and the attorney for the defendant. The stipulation incorporated the parties' settlement agreement and provided that the matter would be dismissed without prejudice and with leave to reinstate. Pertinent to this dispute, it provided that "[u]pon default and failure to cure as set forth in the Settlement Agreement, the Court shall enter a judgment in favor of Plaintiff and against Defendant Henaghan in the amount of $66,958.49, less any amount heretofore paid pursuant to said Settlement Agreement."
¶ 7 Finally, the court file contains an order entered March 13, 2013, which provided that the cause was dismissed without prejudice as to the defendant, as it appeared to the trial court that the case had been resolved through settlement by agreement of the parties. As stated above, the claim against Cullen was voluntarily dismissed with prejudice by a separate order entered later.
¶ 8 On October 17, 2017, the plaintiff filed in the trial court a "Motion for Entry of Judgment" against the defendant. By that motion, the plaintiff sought to have the trial court enter a judgment against the defendant pursuant to paragraph 7 of the settlement agreement, set forth above. The motion recited that the defendant had paid $26,400 toward the settlement, but the payment that had been due on October 1, 2017 was not timely made. Attached to the motion was a notice that the plaintiff had purportedly sent to the defendant, along with a proof of delivery by FedEx to the defendant's address on October 6, 2017. The notice stated:
According to the plaintiff's motion, no payment was received by October 16, 2017. Based on this, the plaintiff argued he was entitled to a judgment pursuant to the terms of the settlement agreement. The motion sought entry of judgment in the amount of $40,558.49, which was $66,958.49 less the $26,400 paid by the defendant as of that date.
¶ 9 The defendant filed a response brief which was supported by her own affidavit. In her brief, the defendant argued that she had "cured" any default, as allowed by paragraph 7 of thesettlement agreement, by mailing a check to the plaintiff on October 14, 2017. She argued that she had been making payments this way (i.e., by sending a check through the U.S. Mail) since April 1, 2013, and thus the plaintiff had assented to this method of payment. She also argued in her brief that she had actually paid the plaintiff $27,000, when the total amount owed with interest was only $26,876.50. Finally, she argued that it would be unconscionable to award the plaintiff a judgment in the amount of $40,558.49, when at the time of default she had paid $26,400 toward a debt of $26,876.50, and since that time she had paid the debt in full.
¶ 10 The plaintiff filed a reply brief in which he acknowledged that he had received a $350 check in the mail from the defendant on October 19, 2017. He argued that the defendant had not "cured" the default by mailing the check prior to October 16, 2017, but rather a "cure" required that he actually receive the funds by that date. He argued that the fact that he had accepted payments sent by mail in the past was "not an implied agreement that a default will be deemed cured upon making a check." He also stated in his reply brief that the default of the payment due October 1, 2017, was "not the first default, nor the first one not timely cured." He further argued that the defendant was miscalculating the total that she owed under the settlement agreement, and she still owed approximately $1,956.89 and had not paid off the debt. Finally, he argued that enforcing the settlement agreement's provisions against the defendant would not be unconscionable, as the settlement had provided her with "a very large discount if, and only if, she paid the discounted amount on a timely basis," which she failed to do.
¶ 11 On December 7, 2017, the trial court entered an order denying plaintiff's motion for entry of a judgment. No report of proceedings or bystander's report from the hearing of December 7, 2017, is included in the limited record on appeal to which the parties stipulated. Ill. S. Ct. R. 323(a), (c) (eff. July 1, 2017). Thus, we are unable to ascertain the specific basis upon which thetrial court ruled or its exact reasons for doing so.
¶ 13 Before we can reach the merits of this appeal, we must address the defendant's argument that this court lacks jurisdiction to do so. The defendant argues that the trial court's order denying the plaintiff's motion for entry of judgment is not a final judgment subject to appellate review, in that it did not dispose of all the rights between the parties. The defendant posits that hypothetically she could still breach the settlement agreement in the future prior to fully paying off the debt, if she defaults on a future installment payment and fails to cure it, in which...
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