In re Estate of Rao

• Court: Appellate Court of Illinois
• Decided: February 3, 2023
• Docket: 1-12-20055
• Status: Unpublished

Opinion

2023 IL App (1st) 1220055-U FIFTH DIVISION February 3, 2023 No. 1-22-0055

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). ______________________________________________________________________________

IN THE APPELLATE COURT OF ILLINOIS FIRST DISTRICT ______________________________________________________________________________ IN RE ESTATE OF BASAVAPUNNAMMA K. RAO, ) Appeal from the Circuit Court Deceased. ) of Cook County. ) (PADMA RAO, ) ) Petitioner-Appellant, ) ) v. ) No. 2013 P 6243 ) FMS LAW GROUP, LLC, ) Honorable ) James P. Murphy, Respondent-Appellee.) ) Judge, presiding.

PRESIDING JUSTICE DELORT delivered the judgment of the court. JUSTICE LYLE concurred in the judgment. JUSTICE MITCHELL concurred in part and dissented in part.

ORDER

Held: In this decedent’s estate case, we vacate the portion of the attorney fee award granted for defending against a petition for writ of certiorari in the United States Supreme Court, and we remand that matter with instructions. We affirm the remainder of the fee award. 1-22-0055

¶1 This appeal presents another installment in the ongoing dispute between Padma Rao and

her sister Anita over the administration of the estate of their mother, Basavapunnamma K. Rao.1

The successor independent administrator of the estate, Midland Trust Company, is represented by

FMS Law Group, LLC. Padma appeals the circuit court’s order awarding FMS attorney fees for

(1) defending a prior fee petition; (2) defending against Padma’s petition for writ of certiorari in

the United States Supreme Court; and (3) attempting to coordinate a settlement conference with

Padma. We affirm in part, vacate in part, and remand with instructions.

¶2 BACKGROUND

¶3 The factual background and procedural posture of the underlying litigation is set forth in

our disposition of Padma’s prior appeal In re Estate of Rao, 2022 IL App (1st) 210316-U. Here,

we limit our discussion to the facts relevant to this appeal.

¶4 Basavapunnamma K. Rao died testate on October 13, 2013. She was survived by her two

daughters: Padma and Anita. Her will was admitted to probate shortly thereafter, and Padma was

appointed as administrator of the estate.

¶5 A few months later, Padma filed a medical malpractice lawsuit against NorthShore

University Health System and four of her mother’s treating physicians. After extensive settlement

negotiations, Padma signed a settlement agreement, but she later changed her mind, citing her and

her late mother’s religious beliefs that purportedly did not allow settlement of disputes. The circuit

court was unpersuaded by these eleventh-hour claims and approved the settlement. Padma moved

to vacate the approval orders in her capacity as estate administrator. After the court removed

Padma as estate administrator, the court allowed the new administrator, Midland, to withdraw

1 In a separate order issued today, this court has also resolved another appeal in this case. In re Estate of Rao, 2023 IL App (1st) 1220333-U.

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Padma’s motion to vacate. Padma then appealed orders granting Midland’s motion to withdraw

her motion to vacate the settlement order, denying her motion to reconsider that order, and

approving the settlement order and distribution order of the medical malpractice case. Midland

moved to dismiss Padma’s appeal for lack of standing, on the basis that she was no longer

administrator of the estate and thus could not represent its interests. This court issued a minute

order reciting that the matter came before the court on Midland’s motion to dismiss, and merely

stating: “IT IS HEREBY ORDERED that said motion is GRANTED”. See In re Estate of Rao,

No. 1-19-1427 (order of Feb. 20, 2020).

¶6 Undeterred, Padma filed a petition for rehearing in this court, a petition for leave to appeal

in the Illinois Supreme Court, a petition for writ of certiorari in the United States Supreme Court,

and a petition for rehearing regarding the denial of the petition for writ of certiorari (See Rao v.

Midland Trust Co., 141 S. Ct. 2626 (Mem.)). To be clear, Padma twice urged the Supreme Court

of the United States to hear her dispute regarding this court’s one-sentence minute order dismissing

her appeal for lack of standing. All of Padma’s efforts were unsuccessful. Nonetheless, these

efforts resulted in legal expenses for Midland.

¶7 On September 30, 2021, FMS filed its third petition for fees. The petition covered FMS’s

fees and costs incurred in representing Midland from November 3, 2020 through August 2, 2021.

FMS requested $80,432.50 in attorney fees for 203.8 hours of attorney time and $5157.74 in costs

for a total of $85,590.24. Not all of FMS’s billings for that period are contested. Padma takes issues

with the following: (1) FMS’s fees for defending its prior petition for fees; (2) FMS’s fees for

responding to Padma’s petition for writ of certiorari in the United States Supreme Court; and (3)

FMS’s fees for attempting to negotiate a settlement with Padma.

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¶8 Over Padma’s objections, the circuit court approved FMS’s petition, but it reduced the

attorney fees from $80,432.50 to $74,045.50. This reduction only affected the fees associated with

FMS’s response to Padma’s petition for writ of certiorari in the Supreme Court of the United

States. According to the circuit court, FMS billed approximately $55,000 worth of attorney time

for responding to Padma’s petition for writ of certiorari, and five FMS lawyers billed for this task.

The circuit court did not find the amount billed to be excessive, acknowledging that responding to

such a petition is a “rather involved process.” However, the court did find that the hourly rates

charged by two associate attorneys were too high. Therefore, it reduced one associate’s rate from

$300 per hour to $250 per hour, and another associate’s rate from $425 per hour to $350 per hour.

These resulted in a reduction of $5100. The court also allowed a number of smaller adjustments,

which resulted in an additional reduction of $1527.50. Thus, the court reduced the requested

attorney fees by a grand total of $6627.50.

¶9 The court was unpersuaded by Padma’s objection to FMS’s request for fees incurred in

defending a prior fee petition. The court did not read the decision Padma cited in support of her

objection, In re Estate of Halas, 159 Ill. App. 3d 818 (1987), to prohibit the award of attorney fees

that were incurred in defending a prior petition fee petition. Rather, the circuit court read the Halas

decision narrowly as prohibiting only fees billed in defending a petition “in the trial court.”

Accordingly, it did not find the Halas ruling instructive, and denied Padma’s objection to these

fees. The circuit court was also unpersuaded by Padma’s objection to fees related to FMS’s

attempts to engage in settlement discussions because it found that such attempts were reasonable

and “saved the Estate financially.” Therefore, the court denied Padma’s objection to these fees as

well. This appeal followed.

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¶ 10 ANALYSIS

¶ 11 On appeal, Padma argues that (1) FMS, as the legal representative of the estate’s

representative (Midland), cannot receive fees for work incurred in defending its own fees; (2) the

fees awarded for work defending against Padma’s petition for writ of certiorari in the United States

Supreme Court were excessive, and (3) FMS’s attempts to negotiate a possible settlement with

Anita were improper, because Padma had expressed her categorical refusal to settle.

¶ 12 We have an independent duty to consider whether we have jurisdiction and to dismiss an

appeal for lack of jurisdiction. Williams Montgomery & John Ltd. v. Broaddus, 2017 IL App (1st)

161063, ¶ 32 (citing Archer Daniels Midland Co. v. Barth, 103 Ill. 2d 536 (1984)). Although the

general rule is that a party can appeal a case “only after the circuit court has resolved all claims

against all parties,” there are exceptions to that rule. See State Farm Fire & Casualty Co. v. John

J. Rickhoff Sheet Metal Co., 394 Ill. App. 3d 548, 556 (2009).

¶ 13 Pursuant to Rule 304(b)(1), a judgment or order entered “in the administration of an estate

*** which finally determines a right or status of a party” is appealable without a Rule 304(a)

finding. Ill. S. Ct. R. 304(b)(1) (eff. Mar. 8, 2016). The committee comments to this provision

explain that Rule 304(b)(1) “applies to orders that are final in character although entered in

comprehensive proceedings that include other matters” and cites as an example “an order ***

allowing or disallowing a claim.” Ill. S. Ct. R. 304, Committee Comments (rev. Sept. 1988).

¶ 14 Here, Padma appeals the circuit court’s order of December 9, 2021, which awarded FMS

the fees and costs it incurred related to its representation of Midland. As this order was a final

determination regarding the amount and source of the funds to satisfy the attorney fees and costs

for the relevant period of representation, we have jurisdiction over this appeal.

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¶ 15 Sections 27-1 and 27-2(a) of the Probate Act of 1975 (Act) provide that an estate

representative and the attorney for the representative are entitled to reasonable compensation for

their services. 755 ILCS 5/27-1 (West 2020) (representative); 755 ILCS 5/27-2(a) (West 2020)

(attorney for representative). There is no set formula for determining a reasonable fee; each

determination turns upon the particular facts and circumstances of each case. Estate of Brown, 58

Ill. App. 3d 697, 706 (1978). The factors a court should consider, however, are: the size of the

estate, the work done and the skill with which it was performed, the time required, the advantages

gained or sought by the services rendered, as well as good faith, diligence, and reasonable

prudence. Id.; see also In re Estate of Halas, 159 Ill. App. 3d 818, 832 (1987) (reiterating Brown

factors and adding “the novelty and complexity of the issues confronted”). The determination of

what constitutes an estate administrator’s or estate attorney’s reasonable compensation is “a matter

peculiarly within the discretion of the Probate Court.” Brown, 58 Ill. App. 3d at 706. We therefore

will uphold the circuit court’s fee determination unless it abused its discretion, which is “the most

deferential standard of review—next to no review at all.” In re D.T., 212 Ill. 2d 347, 356 (2004).

A court abuses its discretion when its ruling is “arbitrary, fanciful, or unreasonable,” or where “no

reasonable person would take the view adopted by the trial court.” In re Marriage of Lindman, 356

Ill. App. 3d 462, 467 (2005). We now turn to the questions presented.

¶ 16 Padma first contends that FMS cannot be awarded fees for its work in defending a prior

fee petition. In support, Padma cites the Halas decision, which notes that “[t]ime spent preparing

or litigating the fee petition does not benefit the estate and will not be allowed.” Halas, 159 Ill.

App. 3d at 833. Padma also cites our supreme court’s decision in Leader v. Cullerton, 62 Ill. 2d

485 (1976), but does not provide a quotation or pinpoint citation to support her apparent argument

that Leader prohibits fee awards in this context. In Leader, the court found that the number of

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hours expended by class counsel was excessive, so it reduced the hours eligible for a fee award.

Id. at 491. Though the court did note that 51 hours had been billed for the attorneys’ work in

prosecuting fee petitions, it did not hold that billing for time spent prosecuting is outright

prohibited. Id. In fact, the court expressed no opinion on this 51-hour figure at all. Accordingly,

we fail to see how that decision is applicable to this case.

¶ 17 We also do not read Halas to outright prohibit the award of attorney fees for preparing or

defending a fee petition. The Halas decision did not explain its reasoning in holding that the award

of fees for preparing or litigating a fee petition is not allowed, so we do not see a compelling reason

to expand its reach beyond the specific facts of that case without first examining how other Illinois

courts have handled this issue. Our research has not revealed any other Illinois decision that

contemplates such a prohibition. Rather, we have found that decisions addressing the issue have

reached the opposite conclusion and allowed the award of such fees.

¶ 18 In the context of the Illinois Marriage and Dissolution of Marriage Act, another statutory

fee-shifting environment, this court has held that one spouse has the right to petition the court to

require the other spouse to pay for both parties’ attorney fees, which “would

logically include drafting the petition for fees.” In re Marriage of Powers, 252 Ill. App. 3d 506,

513 (1993). With respect to the Illinois Human Rights Act, this court has found “no abuse in the

decision to award fees for preparation of the petition for attorney fees” where there is a general

statutory authorization of attorney fees. Rackow v. Illinois Human Rights Comm’n, 152 Ill. App.

3d 1046, 1064 (1987). In Wayne Township Board of Auditors, DuPage County v. Ludwig, 154 Ill.

App. 3d 899 (1987), the court allowed a township supervisor who successfully defended himself

in a contempt proceeding brought against him by the town board to recover attorney fees for

prosecuting the proceeding to recover his attorney fees after the board refused to pay the fees. Id.

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at 909-910. The court reasoned that “[h]olding otherwise would dilute the effect of the statute by

requiring successful litigants to incur additional costs to enforce their rights.” Id. at 910.

¶ 19 These examples illustrate that in statutory fee-shifting environments, attorney fees may be

awarded for defending fee petitions. Padma presents no compelling reason why the same should

not be the case with respect to attorney fees awarded in decedent’s estate cases. Accordingly, on

this record, we cannot find that the circuit court abused its discretion in awarding fees for time

spent preparing a fee petition in this probate case.

¶ 20 Padma next contends that the $55,000 in attorney fees requested by FMS for its work in

responding to Padma’s petition for writ of certiorari was excessive.

¶ 21 First, we note that the issue of standing, which forms the basis for Padma’s petition for writ

of certiorari, had already been briefed when Padma petitioned the Illinois Supreme Court for leave

to appeal the one-sentence order dismissing her appeal for lack of standing. FMS filed an extensive

20-page answer to Padma’s petition in the Illinois Supreme Court. Upon initial review, it appears

that the content of FMS’s response to Padma’s petition in the Supreme Court of the United States

overlaps substantially with FMS’s answer to Padma’s petition for leave to appeal in the Illinois

Supreme Court. FMS cannot bill multiple times for performing substantially the same work. “In

the event the court finds the hours claimed are the result of unnecessary, duplicative work efforts,

it must reduce the excessive hours claimed.” In re Marriage of Rossi, 113 Ill. App. 3d 55, 63

(1983) (citing In re Marriage of Jantzke, 97 Ill. App. 3d 418, 424 (1981)). See also Leader, 62 Ill.

2d at 490-91 (“Wasted time or needless duplications cannot be used to enhance the fees.”). On

remand, we direct the circuit court to determine the amount of duplicative work performed, and

take that into consideration in reducing FMS’s fee award.

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¶ 22 Second, apart from the issue of duplicative work, we seriously question the prudence of

responding to Padma’s petition at all. Since the underlying order Padma challenged was nothing

more than a one-sentence minute order dismissing her appeal for lack of standing on the basis that

she was not the estate administrator, FMS should have known that the Supreme Court of the United

States would find it did not warrant review.

¶ 23 The leading treatise on United States Supreme Court practice explains that with respect to

petitions for certiorari that seem clearly meritless, a respondent may waive the right to file an

opposition. See R. Stern, E. Gressman, S. Shapiro & K. Geller, Supreme Court Practice 6-152

(11th ed. 2019). In that case, the respondent would simply cite the opinion below and inform the

Supreme Court of his or her view that the petition does not warrant review. Id. This approach saves

time and money, and does not impose any substantial risk because even if, in the off chance, the

Supreme Court decides that a petition may have some merit, it will usually request a response to

be filed. Id. In other words, a respondent who chooses to waive filing an opposition brief will not

be prejudiced in the unlikely event that the Supreme Court finds potential merit in the petition. We

find this approach would have been the obvious choice for FMS, rather than incurring $55,000 in

fees for no benefit whatsoever. On remand, we direct the circuit court to take this into consideration

in reducing FMS’s fee award.

¶ 24 In sum, we find that the fees FMS expended in responding to Padma’s petition for writ of

certiorari were excessive and that the circuit court abused its discretion in approving them at the

amount stated. “Time records, although important, are not conclusive, and should be scrutinized

to determine whether they represent a reasonable expenditure of time in the context of the work

performed.” McHugh v. Olsen, 189 Ill. App. 3d 508, 514, 545 (1989); Richardson v. Haddon, 375

Ill. App. 3d 312, 315 (2007). Though the circuit court here did reduce two attorneys’ rates and

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allowed several smaller deductions, it failed to adequately scrutinize the time records to determine

whether they were, on the whole, reasonable expenditures of time, bearing in mind that much of

the work had already been done in the context of the petition for leave to appeal in the Illinois

Supreme Court. We therefore vacate the portion of the order awarding fees for responding to the

petition for writ of certiorari and direct the circuit court to re-examine these fees and reduce them

accordingly.

¶ 25 Padma further contends that awarding fees to FMS for its work in attempting to coordinate

a settlement conference with Padma was improper because FMS knew of Padma’s categorical

refusal to settle. However, Padma does not cite any cases or other authority in support of the notion

that fees cannot be awarded to a law firm for its time spent attempting to settle a case. This is

unsurprising, given the well-settled principle that courts favor settlement. Metropolitan. Sanitary

District of Greater Chicago ex rel. O’Keeffe v. Ingram Corp., 85 Ill. 2d 458, 470 (1981)

(“Nevertheless, it is true that courts favor settlements.”). It would defy logic to deny a fee award

for efforts that are strongly encouraged by the courts. Under our supreme court rules, legal

arguments must be supported by “citation of the authorities and the pages of the record relied on.”

Illinois Supreme Court Rule 341(h)(7) (eff. Oct. 1, 2020). Padma fails to cite any legal authority

in support of her contention, and therefore, her argument cannot be properly considered.

¶ 26 Additionally, Padma does not identify the amount of fees at issue for improper settlement

negotiations. We are left to guess which times entries are at issue, and by how much they should

be reduced. We will not engage in a guessing game. It is not our role to “search the record in order

to reverse the circuit court’s judgment.” Calloway v. Bovis Lend Lease, Inc., 2013 IL App (1st)

112746, ¶ 115. We therefore cannot find any abuse of discretion on this issue and thus affirm the

portion of the fee award pertaining to settlement efforts.

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¶ 27 CONCLUSION

¶ 28 We affirm the portions of the fee award order pertaining to defending the prior fee petition,

and to the settlement efforts. We vacate the order in part and remand for reconsideration of the

fees FMS incurred in responding to Padma’s petition for writ of certiorari.

¶ 29 Affirmed in part; vacated and remanded with instructions in part.

¶ 30 JUSTICE MITCHELL, concurring in part and dissenting in part:

¶ 31 Is $55,000 in attorney fees an excessive amount to charge for filing a response to a

certiorari petition in the United States Supreme Court? I decline to substitute my judgment on

what constitutes a reasonable fee for that of the circuit court, which possesses the requisite skill,

expertise, and knowledge of the case to make that determination. See In re Estate of Halas, 159

Ill. App. 3d 818, 832 (1987). Therefore, I respectfully dissent as to the portion of the majority’s

order vacating counsel’s fee award.

¶ 32 Illinois law instructs the circuit court to consider the following factors before awarding

attorney fees: the estate’s size, the time and skill required to perform the work, the benefits

conferred by the attorneys’ efforts, and the attorneys’ good faith and diligence in rendering

services. In re Estate of Shull, 295 Ill. App. 3d 687, 691-694 (1998); see also Ill. R. Prof’l Conduct

(2010) R. 1.5(a) (eff. Jan. 1, 2023) (listing the factors bearing on the reasonableness of attorney

fees); Restatement (Third) of the Law Governing Lawyers § 34 (2000) (listing same factors). Here,

the circuit court awarded $74,045.00 to Midland Trust Company’s counsel, FMS Law Group,

LLC, for 203.8 hours of work performed from November 2020 through August 2021. See 755

ILCS 5/27-2(a) (West 2020). In so doing, the circuit court found that the estate was “complex,”

that the “litigation [was] often complicated,” and that responding to a certiorari petition was “not

an ordinary task of [estate] administration performed by your garden variety representative.” The

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circuit court further found that counsel’s efforts benefited the estate, as the settlement that counsel

had defended on appeal resulted in an additional $2.1 million for the beneficiaries. The circuit

court clearly weighed the above factors before awarding attorney fees over Padma Rao’s

objections, and we should not disturb the circuit court’s findings if there is any evidence in the

record to support them. Halas, 159 Ill. App. 3d at 831.

¶ 33 The majority’s assertion that the circuit court “failed to adequately scrutinize the time

records” is not borne out by the record, which reflects that the circuit court inspected the individual

billing descriptions, reduced two of the associates’ hourly rates, and deducted five entries prior to

awarding fees. In total, the circuit court deducted $6,627.50. The majority also characterizes

counsel’s time responding to Rao’s certiorari petition as mostly duplicative because it concerned

the same issue as her petition for leave to appeal to the Illinois Supreme Court. But the circuit court

already considered and rejected that argument, finding that the billing records indicated “a rather

involved” and “time consuming” process.2

¶ 34 The majority further opines that Midland perhaps should have waived its right to respond

to the certiorari petition. This, I think, crosses the line into second guessing counsel’s litigation

strategy and is well beyond the sort of deferential review owed to the circuit court’s fee award.

Significantly, if Rao had wished to argue such a point, she could have offered an opinion from an

expert seeking to establish that counsel’s strategy was ill-advised and unreasonable. See Timothy

Whelan Law Associates, Ltd v. Kruppe, 409 Ill. App. 3d 359, 367 (2011). The record is devoid of

2 Many of the billing entries reflect time spent responding to Rao’s numerous motions in the circuit court and defending a prior fee petition on appeal. Moreover, the billing descriptions indicate that counsel, in addition to addressing the overlapping issues, drafted arguments tailored to the Supreme Court’s analysis of certiorari petitions. See Robert L. Stern et al., Supreme Court Practice § 6.37, at 455 (8th ed. 2002).

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such evidence. Accordingly, based on this record, I cannot conclude that the circuit court acted

unreasonably, and I would affirm the circuit court’s order in its entirety.