Amyriad, Inc v. Ray

2020 IL App (1st) 190628-U

• Court: Appellate Court of Illinois
• Decided: May 11, 2020
• Docket: 1-19-0628
• Status: Unpublished

Opinion

2020 IL App (1st) 190628-U

No. 1-19-0628

Order filed May 11, 2020

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).

) AMYRIAD, INC., ) Appeal from the Circuit Plaintiff-Appellant, ) Court of Cook County ) v. ) ) No. 18 L 3898 JOHN H. RAY, III, an individual, and RAY ) LEGAL CONSULTING GROUP, P.C., ) ) The Honorable John H. Defendant-Appellee. ) Ehrlich, Judge Presiding )

JUSTICE PIERCE delivered the judgment of the court. Presiding Justice Griffin and Justice Hyman concurred in the judgment.

ORDER

¶1 Held: The circuit court did not abuse its discretion in dismissing case and compelling arbitration.

¶2 This is an appeal from the entry of an order denying reconsideration of the circuit court’s

order dismissing the case and compelling arbitration. Plaintiff filed an amended complaint against

defendants alleging negligence, violation of the Illinois Deceptive Practices and Consumer Fraud

Act (815 ILCS 505/1, et seq. (West 2018)), and breach of contract. Defendants filed a motion to

dismiss and compel arbitration pursuant to 735 ILCS 5/2-619(a)(9) (West 2018) and 710 ILCS 5/2

(West 2018). The circuit court granted the motion to dismiss and compel arbitration. Plaintiff filed

a motion to reconsider the order, which the circuit court denied. Plaintiff timely appealed. For the

following reasons, we affirm the judgment of the circuit court. No. 1-19-0628

¶3 I. BACKGROUND

¶4 Plaintiff filed an amended complaint against defendants on July 24, 2018. In its amended

complaint, plaintiff, Amyriad, Inc., alleged that “Plaintiff and [John H. Ray, III, and Ray Legal

Consulting Group, P.C.] entered into a valid contract for legal services for litigating” an appeal

that plaintiff was pursuing in another case. Plaintiff alleged that its president, Harry Barnett,

worked with John Ray over several months to complete a certified bystander’s report of

proceedings for that appeal. Plaintiff alleged that the trial court had scheduled a hearing for

approval of the bystander’s report for February 2016. However, plaintiff alleged that defendants

failed to inform it that the appeal had been dismissed for want of prosecution on November 18,

2015, and that a subsequent motion to reinstate the appeal had been denied on December 30, 2015.

Nevertheless, plaintiff alleged that the parties continued to meet regarding preparation of the

bystander’s report, and on February 1, 2016, plaintiff paid defendants an additional $3,500 in legal

fees related to the appeal.

¶5 Plaintiff alleged that defendants were negligent by failing to prosecute the appeal. Plaintiff

also alleged that defendants committed deceptive practices by continuing to accept payment for

legal services related to the appeal without informing plaintiff that the appeal had been dismissed.

Finally, in its amended complaint plaintiff stated that the parties “entered a valid contract for legal

services for litigating the appeal,” that plaintiff had “performed under the contract by paying legal

fees to defendants as agreed,” and that defendants breached the contract by failing to perform legal

services as agreed. In its operative complaint, plaintiff did not specify whether the contract was

oral or written, nor did plaintiff attach a copy of the contract to the complaint. In its complaint,

however, plaintiff alleged that it entered into a “written contract for legal services.”

¶6 Defendants filed a motion to dismiss and compel arbitration pursuant to 735 ILCS 5/2-

2 No. 1-19-0628

619(a)(9) and 710 ILCS 5/2. Defendants argued that the complaint should be dismissed and

arbitration compelled because in the parties’ contract for legal services, plaintiff agreed to arbitrate

all claims arising out of defendants’ legal representation of plaintiff. Defendants did not attach a

copy of the contract purportedly signed by both parties to their motion. Rather, defendants attached

the affidavit of defendant, John Ray, and copies of two emails between the parties.

¶7 The affidavit can be summarized as follows. The parties entered a written contract for legal

services on or about June 7, 2015. This was the only contract between the parties. “Plaintiff

represented that he signed and retained a copy of the [contract], which he would deliver to

Defendants, but Defendants have not had the opportunity to search for the executed copy in storage

files to determine if it has a signed copy.” Ray attested that Harry Barnett had previously entered

into a similar contract with similar terms with defendants. Both parties acted in conformity with

the contract, and plaintiff later paid invoices that were issued pursuant to the contract.

¶8 Also attached to defendants’ motion was an email dated June 7, 2015, from John Ray to

Harry Barnett. The email included a contract for legal services related to the appeal that was signed

by John Ray, but not by plaintiff. Defendants alleged that this was the agreement entered into

between the parties. In the body of the e-mail, John Ray wrote, “Please review, and if acceptable,

countersign.” The contract contained the following provision.

“Arbitration. You agree that any disputes arising out of the representation shall be

submitted to confidential and binding arbitration with and under the rules of the American

Arbitration Association in and only in Chicago, Illinois (or with such other arbitrator or

mediator and in such other place as mutually agreed to by the parties), and hereby waive

any right to a jury or to bring any action in any court of competent jurisdiction. This

Agreement shall be governed by and construed in accordance with the laws Illinois without

3 No. 1-19-0628

regard to conflict of law principles.”

¶9 Defendants also attached to their motion another email from John Ray to Harry Barnett.

This email contained the first billing statement issued to plaintiff for legal services rendered by

defendants for the appeal. The billing statement referenced the appeal and bystander’s report, and

the hourly rates billed reflected those set forth in the contract attached to the June 7, 2015, email.

¶ 10 In its response, Plaintiff argued that the arbitration provision in the contract attached to

defendants’ motion was unenforceable because the contract was never signed by plaintiff. Plaintiff

argued that without a signed written agreement, the parties did not have a valid arbitration

agreement under 710 ILCS 5/1 (West 2018). Plaintiff also argued that the arbitration agreement

could not be made enforceable by its payment of the invoices because the invoices did not

specifically reference the purported contract. Plaintiff did not file a counter affidavit to dispute

John Ray’s statements that the contract attached to the June 7, 2015, email was the operable

agreement, that plaintiff signed the contract, and that plaintiff paid the invoices in accordance with

the contract.

¶ 11 On November 26, 2018, the circuit court granted defendants’ motion to dismiss and compel

arbitration. The order granting the defendants’ motion read,

“This matter coming to be heard on defendants’ motion to dismiss and compel

arbitration, due notice having been given to the parties, and the court being fully

advised, it is hereby ordered that defendants’ motion is granted, the case is

dismissed and arbitration compelled.”

The record on appeal contains no report of proceedings or certified bystander’s report of

proceedings for the November 26, 2018, hearing, as provided for in Illinois Supreme Court Rule

323 (eff. Jul. 1, 2017).

4 No. 1-19-0628

¶ 12 On December 26, 2018, Plaintiff filed a motion to reconsider the court’s November 26,

2018, order. Defendants filed their response in opposition and a cross-motion for sanctions under

Illinois Supreme Court Rule 137 (eff. Jul. 19, 2018). On February 25, 2019, the circuit court denied

the motion to reconsider and cross-motion for sanctions. The order denying plaintiff’s motion to

reconsider read,

“This matter coming to be heard on plaintiff’s motion to reconsider the November

26, 2018 order. The parties received proper notice, the court has jurisdiction over

the parties and the subject matter, and the court has been fully apprised of all issues.

It is ordered: plaintiff’s motion is denied. Defendants’ cross-motion for sanctions

is denied.”

The record on appeal contains no report of proceedings or certified bystander’s report of

proceedings for the hearing on plaintiff’s motion to reconsider.

¶ 13 Plaintiff filed a notice of appeal on March 26, 2019. In the notice of appeal, which was not

designated as interlocutory, plaintiff stated that it was appealing from the court’s November 26,

2018, order dismissing the case and compelling arbitration and the court’s February 25, 2019,

order denying reconsideration of the November 26, 2018, order.

¶ 14 II. ANALYSIS

¶ 15 We have jurisdiction over this appeal pursuant to Illinois Supreme Court Rule 307 (eff.

Nov. 1, 2017). Under Rule 307, an interlocutory appeal may be taken from an order granting or

denying a motion to compel arbitration because such motions are “analogous to a motion for

injunctive relief.” Bass v. SMG, Inc., 328 Ill. App. 3d 492, 496 (2002). The denial of a motion to

reconsider an order compelling arbitration has the effect of perpetuating an injunction and is also

appealable under Rule 307. Craine v. Bill Kay’s Downers Grove Nissan, 354 Ill. App. 3d 1023,

5 No. 1-19-0628

1025 (2005) (citing Clark v. Country Mutual Insurance Co., 131 Ill. App. 3d 633, 636 (1985),

and Property Management, Ltd. v. Howasa, Inc., 14 Ill. App. 3d 536, 539 (1973)). Because

plaintiff filed his notice of appeal within 30 days of the entry of the order denying reconsideration

of the court’s November 26, 2018, order, we have jurisdiction to hear its appeal from the order

denying the motion to reconsider.

¶ 16 We note that the parties disagree as to our standard of review. Plaintiff argues that the

circuit court made no factual findings in entering its order dismissing the case and compelling

arbitration, and therefore our standard of review is de novo. Defendants argue that the circuit court

made factual findings regarding the existence of the agreement and arbitration provision, and thus

its decision on the motion to compel should be reviewed for abuse of discretion, and any factual

findings made on the motion to dismiss should be reviewed under the manifest weight of the

evidence standard.

¶ 17 On an interlocutory appeal under Rule 307, we consider only whether there was “a

sufficient showing to sustain the order of the trial court granting or denying the relief sought.”

Bass, 328 Ill. App. 3d at 496. “Generally, the standard of review of an order granting or denying

a motion to compel arbitration is whether the trial court abused its discretion.” Federal Signal

Corp. v. SLC Technologies, Inc., 318 Ill. App. 3d 1101, 1105 (2001). However, where the facts

are not in dispute and trial court makes its determination on arbitrability as a matter of law, the

trial court’s order on a motion to compel arbitration is reviewable de novo. Id. at 1105-1106.

¶ 18 Our determination of the standard of review is complicated by the fact that plaintiff failed

to provide this court with a report of proceedings or certified bystander’s report of proceedings for

the court’s rulings on the motion to dismiss and compel arbitration and the motion to reconsider.

Generally, the appellant bears the burden of providing the reviewing court with a complete record

6 No. 1-19-0628

to support its claim of error. Foutch v. O’Bryant, 99 Ill. 2d 389, 391 (1984). Without such a record,

“it will be presumed that the order entered by the trial court was in conformity with law and had a

sufficient factual basis. Any doubts which may arise from the incompleteness of the record will be

resolved against the appellant.” Id. at 391-392.

¶ 19 Our review of the parties’ briefs on the motion to reconsider the November 26, 2018, order

and the briefs before this court reveals that plaintiff claims the circuit court’s erred in finding that

the parties entered into a valid contract to arbitrate. Essentially, plaintiff argues that it did not

accept the contract because there is no evidence that it signed and delivered the agreement to the

defendants, and that therefore the contract and arbitration provision are not enforceable against it.

Plaintiff argues that the parties intended for plaintiff to sign and deliver the contract to defendants

before the contract became enforceable, but there is no proof that it did so. Plaintiff also argues

that its acts in conformity with the contract cannot be a substitute for its signature to show its

acceptance of the contract.

¶ 20 “An agreement to arbitrate is treated like any other contract.” Vassilkovska v. Woodfield

Nissan, Inc., 358 Ill. App. 3d 20, 24 (2005). The existence of a contract, its terms, and the intent

of the parties are questions of fact. Hedlund & Hanley, LLC v. Board of Trustees of Community

College District No. 508, 376 Ill. App. 3d 200, 205 (2007). “Whether a writing constitutes a

binding contract, even though it is not signed, as is the situation presented in the present case,

usually depends upon the intention of the parties.” Id. at 206. A party to a contract may indicate

his acceptance of terms by his signature, but where the mode of acceptance is not specified,

acceptance and intent to be bound may be shown by acts or conduct of the parties. Id.

¶ 21 On a motion to dismiss and compel arbitration, the defendant has the initial burden to put

forth evidence supporting the basis for the motion if the basis is not evident from the complaint.

7 No. 1-19-0628

Hollingshead v. A.G. Edwards & Sons, Inc., 396 Ill. App. 3d 1095, 1101 (2009). “By presenting

an affidavit supporting the basis for the motion, the defendant satisfies the initial burden of going

forward on the motion, and the burden then shifts to the plaintiff. [Citation.] In order to establish

that the motion is unfounded, a counteraffidavit or other proof is necessary to refute the evidentiary

facts properly asserted by the affidavit supporting the motion. [Citation.]” Id. at 1102. “ ‘Where

there is a valid arbitration agreement and the parties’ dispute falls within the scope of that

agreement, arbitration is mandatory and the trial court must compel it.’ ” Griffith v. Wilmette

Harbor Association, Inc., 378 Ill. App. 3d 173, 180 (2007) (quoting Travis v. American

Manufacturers Mutual Insurance Co.,335 Ill. App. 3d 1171, 1174 (2002)).

¶ 22 Because plaintiff’s argument that it did not validly accept the contract raises a claim of

error regarding the circuit court’s factual finding as a basis to compel arbitration, we review the

circuit court’s decision for an abuse of discretion.

¶ 23 We find that defendants satisfied their burden to show a basis for the circuit court to compel

arbitration. John Ray presented an affidavit stating that, although he could not find an executed

version of the contract, the contract and arbitration provision existed in the email he attached to

his affidavit, that plaintiff signed the contract, and that plaintiff performed under the contract by

paying invoices for legal services rendered at the rate specified in the contract. Defendants also

attached the contract and the first billing statement to their motion.

¶ 24 Plaintiff submitted no counteraffidavit or evidence of any kind to dispute the evidence put

forth by defendants. Rather, plaintiff argues that the email from John Ray to Harry Barnett stating,

“Please review and, if acceptable, countersign,” and attaching the contract, showed that the parties

intended plaintiff’s signature and delivery of the contract to defendants to be a condition precedent

to the creation of a valid, written contract to arbitrate. We disagree. This language standing alone

8 No. 1-19-0628

is not evidence that the parties intended plaintiff’s signature and delivery to be the exclusive mode

of acceptance. Rather, the permissive language in the email demonstrates a suggested or preferred

mode of acceptance. The record shows that the plaintiff agreed there was a “valid contract” and

did not dispute by way of a counteraffidavit that the agreement was as shown in the June 7 email

and that plaintiff manifested its acceptance of the contract, including the arbitration provision, by

paying subsequent invoices generated under the agreement. Further, the record shows that the

parties intended the contract to be binding in the absence of a signed and delivered contract because

defendants continued to perform legal services under the contract, and plaintiff paid the invoices

issued for those legal services at the rate set forth in the contract. Plaintiff does not dispute any of

these facts and the contention that only a signed agreement is proof of an agreement is not

persuasive.

¶ 25 Plaintiff also argues that defendants were required by the Illinois Rules of Professional

Conduct to advise it that the contract would become effective without its signature and delivery to

defendants. We find nothing in the record that shows this argument was properly raised in the

circuit court. “It is well settled that issues not raised in the trial court are deemed waived and may

not be raised for the first time on appeal.” Haudrich v. Howmedica, Inc., 169 Ill. 2d 525, 536

(1996). We find that plaintiff waived this argument by failing to advance it in the circuit court.

¶ 26 Based on the record before us, we find that there was sufficient evidence to sustain the

circuit court’s order dismissing the case and compelling arbitration based on the defendant’s

affidavit, attached emails and contract, and invoice submitted by defendants evidencing an intent

to submit disputed issues arising under the agreement to be submitted to arbitration. Therefore, we

find that the circuit court’s order dismissing the case and compelling arbitration was not an abuse

of discretion.

9 No. 1-19-0628

¶ 27 III. CONCLUSION

¶ 28 For the foregoing reasons, the judgment of the circuit court is affirmed.

¶ 29 Affirmed.