Duplicative Claims

Swervo Entertainment Group, LLC v. Mensch

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The District Court for the Northern District of Illinois dismissed in part and refused to dismiss portions of a complaint against an attorney.   The attorney allegedly agreed to hold an advance deposit in escrow and release it if the attorney’s client and the depositor did not reach an agreement.    An agreement was not reached, but the attorney did not release the funds allegedly deposited in escrow.   The court held that the plaintiff stated a claim for fraud (the attorney allegedly never intended to return the funds) and breach of the escrow agreement.   The court further held that the plaintiff’s claim for negligence was barred by the Moorman doctrine, its claim for breach of fiduciary duty was duplicative of the claim for breach of the escrow agreement, its quasi-contract claim was barred by the existence of an actual contract and its claim for attorneys’ fees was barred by the “American rule” barring attorneys’ fees in ordinary litigation.

Swervo Entertainment Group v. Mensch

Recent Illinois Case: Landmark American Insurance Co. v. Deerfield Construction, Inc.

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The federal district court dismissed a breach of fiduciary duty claim as duplicative of a malpractice claim. The court, however, refused to dismiss the malpractice claim in which the plaintiff alleged that the defendants were negligent in their representation during the underlying case and failed to give notice to the plaintiff’s excess insurer who refused to cover the plaintiff’s loss arising out of the underlying judgment.

The defendants argued that the malpractice claim was premature because the plaintiff/insured had not suffered any injury and would not unless and until the coverage dispute with the excess insurer was decided in favor of the insurer.

The Court rejected that argument holding that the “injury has occurred, and it will remain until some other party actually pays the judgment.” (Emphasis in original).

Landmark American Insurance Co. v. Deerfield Construction, Inc., 2016 WL 2977274

(This is for informational purposes and is not legal advice.)

Recent Illinois Case: First American Title Insurance Co. v. Dundee Reger LLC v. Hallam

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The Northern District of Illinois addressed third-party claims against a law firm asserting legal malpractice and, in the alternative, breach of contract and promissory estoppel.  The third-party defendant moved to dismiss the breach of contract and promissory estoppel claims as duplicative of the legal malpractice claim.  The court held that, under Illinois law, duplicative breach of fiduciary duty claims should be dismissed but breach of contract claims, even if duplicative, may be plead in the alternative.  The motion to dismiss was denied.

(This is for informational purposes and is not legal advice.)

First American Title Insurance Co. v. Dundee Reger, LLC et al. v. Peter G. Hallam, 2016 WL 1359374

Land v. Greenwood, 133 Ill. App. 3d 537, 478 N.E.2d 1203 (4th Dist. 1985)

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Land v. Greenwood, 133 Ill. App. 3d 537, 478 N.E.2d 1203 (4th Dist. 1985) (subsequent counsel rule)

Calhoun v. Rane, 234 Ill. App. 3d 90, 599 N.E.2d 1318 (1st Dist. 1992)

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Calhoun v. Rane, 234 Ill. App. 3d 90, 599 N.E.2d 1318 (1st Dist. 1992) (fiduciary duty claim duplicative of negligence claim; no duty to advise of own malpractice)

Brush v. Gilsdorf, 335 Ill. App. 3d 356, 783 N.E.2d 77 (3d Dist. 2002)

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Brush v. Gilsdorf, 335 Ill. App. 3d 356, 783 N.E.2d 77 (3d Dist. 2002) (breach of fiduciary duty and legal malpractice duplicative; breach of fiduciary duty claim was within statutory bar on punitive damages)

Larson v. O’Donnell, 361 Ill. App. 3d 388, 836 N.E.2d 863 (1st Dist. 2005)

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Larson v. O’Donnell, 361 Ill. App. 3d 388, 836 N.E.2d 863 (1st Dist. 2005)