Engle v. Foley and Lardner, LLP

912 N.E.2d 715, 393 Ill. App. 3d 838, 332 Ill. Dec. 228, 2009 Ill. App. LEXIS 1087
CourtAppellate Court of Illinois
DecidedJuly 10, 2009
Docket1-08-2761, 1-08-2762 cons.
StatusPublished
Cited by17 cases

This text of 912 N.E.2d 715 (Engle v. Foley and Lardner, LLP) is published on Counsel Stack Legal Research, covering Appellate Court of Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Engle v. Foley and Lardner, LLP, 912 N.E.2d 715, 393 Ill. App. 3d 838, 332 Ill. Dec. 228, 2009 Ill. App. LEXIS 1087 (Ill. Ct. App. 2009).

Opinion

PRESIDING JUSTICE FITZGERALD SMITH

delivered the opinion of the court:

Plaintiff-appellant Clyde Engle (Engle) sought declaratory, injunctive and other relief against defendant-appellee Foley & Lardner, LLP (Foley), with respect to contractual agreements made between the parties regarding attorney fees. Intervenor-appellant Siobhan Engle (Siobhan), Clyde’s wife and owner of the stock at issue, intervened. Although Engle and Siobhan initially received a temporary restraining order to prevent Foley from foreclosing on certain assets, the trial court, following a hearing, denied their motion for preliminary injunction and dissolved the temporary restraining order.

Engle and Siobhan appeal, making several contentions of trial court error, including a failure to consider evidence that showed Foley breached its obligation and held their interest “hostage,” a failure to order an accounting, a misunderstanding of the presumption of undue influence, a disregard of evidence that showed an unenforceable contract, and a failure to apply the proper standard on a motion for preliminary injunction. They ask that we reverse the trial court’s decision and find that their motion for preliminary injunction should be granted “pending a decision on the merits,” plus any costs or additional relief we deem proper. For the following reasons, we affirm and dismiss the instant appeal.

BACKGROUND

Engle hired Foley to represent him in a cause of action filed in the United States District Court for the Northern District of Illinois by the Illinois Insurance Commissioner (liquidator action), regarding an insurance company in which Engle held an interest. Initial damages in this suit were sought in the amount of $60 million; as the cause progressed, damages were estimated into the hundreds of millions of dollars. Engle and Foley’s agreement was memorialized in a letter dated November 12, 1999, wherein Engle promised to pay Foley’s invoices within 30 days.

Later, Foley also began representing Engle in a separate action occurring in Delaware. By June 2000, Engle and Foley devised a new payment schedule, which resulted in discounted rates of service to Engle. However, even with these new rates, Engle fell behind in his payments of Foley’s fees.

In September 2001, Foley sent Engle a letter suggesting payment arrangements, including the possibility that Engle sell some of his assets to pay the charges in arrears. The letter also stated that Engle would pay reasonable costs of collection, including attorney fees, if Foley sued Engle for collection, and noted that if Engle failed to make payment, he would not object to Foley withdrawing from the pending liquidator action and the Delaware suit. Engle signed and returned the letter without any objection.

By February 28, 2002, Engle had still not yet paid the outstanding balance he owed to Foley, nor any of the newly incurred fees for services performed between September 2001 and February 2002. On that date, Foley sent Engle another letter informing him of this and that the amount owed was now $1,014,147.25. Foley proposed another amended fee agreement, wherein Engle would agree to a plan to pay this principal amount owed by April 5, 2002, via “mutually acceptable instruments to enforce the payment schedule,” and Engle would not object to Foley’s withdrawal from the pending liquidator action if he did not make the payments. 1 Again, Engle agreed and signed this letter without objection.

Engle failed to make any payment by April 5, 2002. On May 2, 2002, Foley sent Engle a notice of Foley’s intent to withdraw as counsel of record in the liquidator action and suggested that Engle retain new counsel within the next two weeks, with Foley facilitating the transition. Foley sent a copy of this notice to Gerald Tierney, an attorney who was in-house counsel to various Engle-related entities, kept an office at the Bank of Lincolnwood (which Engle and Siobhan own), and had filed an appearance in the liquidator action on behalf of several Engle-owned entities involved. Soon thereafter, Foley sent Engle a letter stating that Engle had told Foley he would call to discuss payment arrangements, but that no call was ever received by anyone at Foley, and Foley’s attempts to contact him had been unsuccessful. This letter also again advised Engle that if he was not going to make payment, he needed to arrange for new counsel. Foley sent a copy of this letter to Tierney. Later, Foley sent Engle, and again copied Tierney, a draft promissory note for the unpaid fee amount of $1,014,147.25, as well as a detailed copy of its billing statements for September 2001 through April 2002. Engle did not object to the amount of fees Foley charged or the quality of the work Foley performed.

By July 2002, the liquidator action had been set for mediation. Foley sent Engle a letter reminding him that invoices for its work were unpaid and that Engle had yet to comment on the draft promissory note. Foley advised Engle that unless payment arrangements were in place by July 8, 2002, Foley would inform the mediator that it could not go forward with the mediation and would ask to withdraw from the liquidator action.

Ultimately, Foley and Engle entered into several agreements regarding Engle’s outstanding fees; these agreements were dated August 8, 2002. In them, Engle, acknowledging his indebtedness to Foley and that he had an opportunity to consult with independent counsel about his situation and the agreements, executed a promissory note in the amount of $1,126,861.14, as well as a general security agreement granting Foley a security interest in various assets. The note stated that Engle would make regular payments, with a maturity date of July 2005. At this time, Foley and Engle understood that some of the assets in which Foley was granted a security interest by Engle might be needed to settle the liquidator action. It was therefore agreed between the parties that, should this occur, Foley would release its security to the extent necessary to effectuate a settlement. Following these agreements, Foley continued to represent Engle in the mediation.

The mediation continued through September 2002 but produced no result; the liquidator action proceeded and settlement discussions began in November 2002. In February 2003, the liquidator action was transferred by District Court Judge Amy St. Eve to Magistrate Judge Arlander Keys for settlement conference. On March 6 and 7, 2003, the parties, including Engle himself, appeared and presented the terms of settlement; Foley agreed that it would release its interest in certain of Engle’s assets to effectuate the settlement, as promised. The parties were to finalize the settlement and return to court for status in April 2003. However, finalization of the settlement did not take place as anticipated, and Judge St. Eve set the cause for trial to begin in February 2004.

In the summer of 2003, Foley discussed internally via a memorandum “possible actions relative to” Engle, who, according to the memorandum, had paid about $2.5 million over the course of Foley’s representation but still owed over $1.5 million in unpaid fees.

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Cite This Page — Counsel Stack

Bluebook (online)
912 N.E.2d 715, 393 Ill. App. 3d 838, 332 Ill. Dec. 228, 2009 Ill. App. LEXIS 1087, Counsel Stack Legal Research, https://law.counselstack.com/opinion/engle-v-foley-and-lardner-llp-illappct-2009.