Devriendt v. Carter

2022 IL App (3d) 210283-U

Opinion

NOTICE: This order was filed under Supreme Court Rule 23 and is not precedent except in the limited circumstances allowed under Rule 23(e)(1).

2022 IL App (3d) 210283-U

Order filed November 1, 2022 ____________________________________________________________________________

IN THE

APPELLATE COURT OF ILLINOIS

THIRD DISTRICT

JUDITH A. DEVRIENDT of DEVRIENDT ) Appeal from the Circuit Court & ASSOCIATES, LLC, ) of the 12th Judicial Circuit, ) Will County, Illinois. Plaintiff-Appellee, ) ) Appeal No. 3-21-0283 v. ) Circuit No. 19-SC-4411 ) STEPHEN BRADLEY CARTER, ) ) Honorable Barbara N. Petrungaro, Defendant-Appellant. ) Judge, Presiding. ____________________________________________________________________________

JUSTICE PETERSON delivered the judgment of the court. Justices Daugherity and Hauptman concurred in the judgment.

ORDER

¶1 Held: The circuit court erred in dismissing defendant’s counter-complaint based on the statute of limitations.

¶2 Defendant, Stephen Bradley Carter, and his former wife, Victoria Carter, simultaneously

sought to individually file for Chapter 7 bankruptcy and obtain an order for dissolution of marriage.

Stephen retained Judith A. DeVriendt as counsel in the dissolution matter. Both Victoria and

Stephen were granted relief from the automatic stay in the bankruptcy matters, but the circuit court

handling the dissolution matter was not allowed to distribute real property in the bankruptcy estates per the bankruptcy court orders. A dissolution order issued that did not account for nor distribute

the real property of the parties. DeVriendt filed suit against Stephen seeking unpaid legal fees.

Stephen counterclaimed, alleging that DeVriendt’s malpractice in failing to account for and

distribute the real property in the dissolution proceeding resulted in him being liable for unpaid

property taxes on a piece of property titled in both his and Victoria’s name. The circuit court found

Stephen’s claims were time barred. Stephen appeals. We reverse.

¶3 I. BACKGROUND

¶4 A. Underlying Dissolution and Bankruptcy Proceedings

¶5 In July 2014, Stephen retained DeVriendt to represent him in a dissolution matter involving

Victoria. The retainer agreement governing DeVriendt’s representation of Stephen states, “This

representation is limited to this divorce proceeding only and does not include representing you in

any appeal or other proceedings.”

¶6 During DeVriendt’s representation in the dissolution, both Stephen and Victoria separately

claimed Chapter 7 bankruptcy. The bankruptcy filings initiated an automatic stay. The stay

prevented any action against the bankruptcy estate, comprised of Victoria and Stephen’s legal or

equitable interests in property. Both Stephen and Victoria advanced their dissolution matter by

requesting relief from the stay in their respective bankruptcy proceedings. Stephen stated in his

motion to modify the stay that he understood the judge presiding over the divorce could not divide

or otherwise take jurisdiction over assets in the bankruptcy estates. Stephen obtained an order

modifying stay explicitly stating the order “does not give the Domestic Relations Judge authority

to distribute property that is part of the bankruptcy estates of either [Stephen] in this bankruptcy

case or that of his spouse [Victoria] ***.” The order modifying stay for Victoria contains similar

language prohibiting distribution of property in the bankruptcy estate by the circuit court.

-2- ¶7 Following relief from the bankruptcy stays, the parties pursued dissolution, resulting in a

trial on the issues of grounds, maintenance, and division of retirement accounts. All other property,

including the real property at issue here, was contained within the respective bankruptcy estates.

During her opening statement to the court presiding over the dissolution, DeVriendt presented the

bankruptcy orders to the circuit court stating the parties were in bankruptcy, the court was not to

distribute property interests in the real property, and the dissolution proceeding focused on the

issues of “dissolving the bonds of matrimony and whether it’s a maintenance case or not.” Stephen

was present during this initial court hearing. Stephen later testified that the property owned by the

parties was part of the bankruptcy estate and was outside the jurisdiction of the circuit court.

¶8 The court ruled on the matters at issue in the dissolution but at no time distributed any real

property that was in the bankruptcy estates. DeVriendt was ordered to prepare a judgment for

dissolution of marriage memorializing the court’s rulings. DeVriendt provided a copy of the

judgment to Stephen for review. The dissolution judgment did not include or even reference the

distribution of the parties’ real property or any other property contained in the bankruptcy estates

that was subject to the automatic stay. Judgment was entered on August 31, 2016. With the divorce

proceedings concluded, DeVriendt did not perform any further work for Stephen.

¶9 B. Property Tax Bill

¶ 10 In April 2019, Stephen filed a motion for distribution of marital property in the dissolution

matter after receiving a tax bill for approximately $19,000. The property tax bill was related to a

property located at 128 Elm Street, Walkerton, Indiana. This property was devised to both Stephen

and Victoria by Victoria’s parents. The property was a part of the bankruptcy estates at the time of

the dissolution. Stephen sought a ruling finding the property and corresponding property taxes

were Victoria’s alone. The court entered an order requiring Stephen to pay the back taxes.

-3- ¶ 11 C. Malpractice Claim

¶ 12 In June 2019, DeVriendt filed a complaint seeking fees owed by Stephen for legal services

rendered in the dissolution matter. Stephen filed a two-count counterclaim, alleging breach of

contract and breach of fiduciary duty. He alleged DeVriendt failed to list or account for the disposal

of real property in the dissolution judgment. He also claimed that DeVriendt failed to advise

Stephen that the real property would need to be addressed at a later time due to the pending

bankruptcy. Stephen asserted in his counterclaim that

“[b]ut for DeVriendt’s failure to properly include real property in the final

decree, and her failure to perform the services per the terms of the contract

by providing proper and competent advice, [Stephen] would not have had

to spend additional sums on [attorney] fees and would not be liable for the

nineteen thousand in taxes owed on Victoria’s family home.”

¶ 13 Stephen later amended his counterclaim, again, alleging DeVriendt failed to account for or

dispose of real property in the dissolution order. Further, he asserted that DeVriendt failed to advise

him the property needed to be addressed at a later date. Had he been properly advised, Stephen

“would have sought legal services to have his name removed from the [Indiana] property

immediately following his discharge from bankruptcy.”

¶ 14 DeVriendt filed a combined motion to dismiss Stephen’s counterclaims pursuant to section

2-619.1 of the Code of Civil Procedure (Code). 735 ILCS 5/2-619.1 (West 2018). Initially, the

circuit court denied the motion to dismiss. Nonetheless, upon reconsideration, the court found

Stephen’s claims were time barred. Specifically, an action against an attorney must be commenced

within two years from the time the person bringing the action knew or reasonably should have

known of the injury for which damages are sought. The trial court found Stephen knew or

-4- reasonably should have known the Indiana property was not involved in the dissolution proceeding

and dismissed Stephen’s counterclaim pursuant to section 2-619(a)(5) of the Code. 735 ILCS 5/2-

619(a)(5) (West 2018). The court denied Stephen’s request to reconsider but included language

pursuant to Illinois Supreme Court Rule 304(a) (eff. Mar. 8, 2016) allowing Stephen to bring the

instant appeal.

¶ 15 II. ANALYSIS

¶ 16 Stephen argues the trial court erred in granting DeVriendt’s motion to dismiss. He asserts

that the trial court erred in finding his claims were time barred. He argues the discovery rule applies

and that he had no knowledge the property in Indiana was marital or that any action needed to be

taken. Judgment on a motion to dismiss is reviewed de novo. Cahokia Unit School District No.

187 v. Pritzker, 2021 IL 126212, ¶ 24.

¶ 17 An involuntary dismissal under section 2-619(a)(5) is appropriate if the “action was not

commenced within the time limited by law.” 735 ILCS 5/2-619(a)(5) (West 2018). An action

against an attorney for malpractice is subject to a two-year statute of limitations. 735 ILCS 5/13-

214.3(b) (West 2018). This statute of limitations for legal malpractice incorporates the discovery

rule which serves to toll the two-year time frame until such time the plaintiff knows or reasonably

should know of their injury. Id. Generally, a plaintiff does not sustain an injury until they have

suffered an adverse judgment, settlement, or dismissal in the underlying action. Nelson v. Padgitt,

2016 IL App (1st) 160571, ¶ 13. But, a malpractice action may accrue before the trial court enters

an adverse judgment if it is “ ‘plainly obvious’ ” that the plaintiff “ ‘has been injured as the result

of professional negligence or where an attorney’s neglect is a direct cause of the legal expense

incurred by the plaintiff.’ ” Id. ¶ 14 (quoting Estate of Bass v. Katten, 375 Ill. App 3d 62, 70

(2007)). In other words, the limitations period begins when the plaintiff has a reasonable belief

-5- that the injury was caused by the lawyer’s wrongful conduct and the plaintiff, therefore, has an

obligation to inquire further. Dancor International, Ltd. v. Friedman, Goldberg & Mintz, 288 Ill.

App. 3d 666, 673 (1997). Determining when a plaintiff should have discovered an injury usually

raises a question of fact but determining when the limitations period commences can be decided

as a matter of law if the facts are undisputed and only one answer is reasonable. American Family

Mutual Insurance Co. v. Krop, 2018 IL 122556, ¶ 21.

¶ 18 Here, Stephen alleged that in August 2016 DeVriendt drafted the judgment for dissolution

of marriage. The judgment did not mention or distribute the Indiana property. In addition, Stephen

alleged that at the time of the judgment, DeVriendt advised him that he did not need to take any

further action as to the Indiana property. Stephen alleged that based on DeVriendt’s advice, which

he relied upon, he took no actions regarding the property and he reasonably believed that no further

action was required for the property. At this point, Stephen did not know and should not reasonably

have known of the injury caused by DeVriendt’s alleged faulty advice. In other words, Stephen’s

allegations demonstrated that he did not believe he would be responsible for the property taxes

based on DeVriendt’s advice. This is reasonable, given that clients are not required to seek second

opinions to ensure the accuracy of advice. Lucey v. Law Offices of Pretzel & Stouffer, 301 Ill. App.

3d 349, 357 (1998). Contrary to DeVriendt’s argument on appeal, Stephen was not required to

consult with his bankruptcy attorney to determine who remained responsible for the property taxes

after the divorce. As result, we find that Stephen’s allegations demonstrated he did not have a

reasonable belief that he was injured by DeVriendt’s advice at the time the trial court entered the

judgment for dissolution of marriage. Accordingly, we hold that the trial court erred when it

concluded that the statute of limitations began to run at the entry of the judgment for dissolution

of marriage.

-6- ¶ 19 Instead, in April 2019 Stephen received a letter from the La Porte County Tax Assessor

demanding nearly $19,000 in back taxes on the property. At this point, Stephen should have been

reasonably aware that he sustained an injury as a result of DeVriendt’s alleged negligent advice.

Although no adverse judgment had been entered against Stephen at that point, it was plainly

obvious that the tax bill had alerted Stephen to the fact that he may be responsible for the taxes. In

fact, Stephen alleged that he promptly filed a motion for distribution of the property to ensure that

he was not responsible for the tax bill. This demonstrates that Stephen was aware that DeVriendt’s

alleged faulty advice may have caused an injury to him. Thus, the statute of limitations began to

run in April 2019, when Stephen received the letter from the La Porte County Tax Assessor. Given

that Stephen’s counter-complaint was filed less than two years after this date, the statute of

limitations does not bar his claims. Therefore, the trial court erred when it dismissed Stephen’s

complaint as untimely.

¶ 20 We acknowledge that Stephen contends it was not until the trial court entered an adverse

judgment (requiring Stephen to pay the property taxes) against him that he became aware that he

sustained an injury relating to DeVriendt’s advice. Padgitt, 2016 IL App (1st) 160571, ¶ 13. While

it is arguable that Stephen did not reasonably believe he had been injured until the date of the

adverse judgment, we note that Stephen’s counter-complaint was timely filed in either scenario.

¶ 21 III. CONCLUSION

¶ 22 For the foregoing reasons, we reverse and remand the judgment of the circuit court of Will

County.

¶ 23 Reversed and remanded.

-7-