Musgrave v. French

651 N.E.2d 1125, 166 Ill. 2d 95, 209 Ill. Dec. 677, 1995 Ill. LEXIS 86

• Court: Illinois Supreme Court
• Decided: May 18, 1995
• Docket: No. 76730
• Status: Published

Opinions

JUSTICE McMORROW

delivered the opinion of the court:

In this appeal we are asked to reconsider the decision in Almon v. American Carloading Corp. (1942), 380 Ill. 524, in which this court held that an order disqualifying a party’s counsel for conflict of interest is not subject to immediate appeal.

I

The record reveals the following pertinent information. Anna V. French died in May 1990. Her will nominated Charles A. French (hereafter referred to as Charles) as executor of her estate, and he was later appointed executor by court order. During his period as executor of the estate, Charles was represented by attorney John C. Robison, Jr.

In April 1993, certain of the heirs to Anna French’s estate (hereafter referred to as appellees) filed a petition in the circuit court of Wayne County to remove Charles as executor of the estate. The petition alleged that Charles had mishandled estate funds in breach of his fiduciary duties. A few weeks later, attorney Morris Lane Harvey filed a special and limited appearance on behalf of Charles and contested the court’s jurisdiction to entertain the appellees’ petition to remove Charles as executor.

Shortly thereafter, the appellees filed a motion to disqualify attorney Harvey as Charles’ counsel, citing conflict of interest. They claimed that Harvey had provided them with legal advice regarding the formation of a corporation to receive the assets bequeathed to the appellees under the terms of the French will. The appellees claimed that because attorney Harvey had consulted with them and provided them with legal advice regarding the formation of the corporation, attorney Harvey could not represent Charles with respect to their petition to remove Charles as executor of the French estate.

Following briefing and argument, the trial court allowed the disqualification motion and attorney Harvey was disqualified from representing Charles in the probate action involving Anna French’s estate. The trial court also denied Charles’ motion to reconsider. In its order denying the motion to reconsider, the trial court found no just reason to delay enforcement of or appeal from its ruling. 134 Ill. 2d R. 304(a).

Charles took an appeal from the trial court’s disposition. However, the appellate court entered an order that dismissed the action, relying on Almon, 380 Ill. 524, for the proposition that an order disqualifying a litigant’s counsel is not subject to immediate appeal in this State. We allowed Charles’ petition for leave to appeal (145 Ill. 2d R. 315(a)).

II

Charles argues that this court should overrule Almon. He contends that the rule announced in Almon is too drastic and severe, because it deprives a litigant of counsel he has chosen to represent him during the proceeding. Charles claims that if a disqualification order is not accorded immediate review by the appellate court, the litigant whose counsel is disqualified is effectively denied adequate appellate review of the disqualification order.

The appellees respond that the Almon rule should be retained. The appellees suggest that immediate appeal would cause considerable delay in reaching ultimate resolution of the merits of the parties’ underlying dispute, and that the harms from such delay outweigh any value in immediate appellate review of the trial court’s disqualification decision.

In Almon, 380 Ill. 524, employees of a freight company, who were members of various local unions, had a dispute with a carloading company. The dispute was later settled and an agreement reached between the parties. Thereafter, a disagreement arose as to the terms of the settlement agreement. Various employees filed suit against the carloading corporation as well as the officials of a local union who had participated in the settlement negotiations. After the defendants filed an answer to the plaintiffs’ complaint, the plaintiffs filed a motion to disqualify the defendants’ attorney of record. Following a hearing, the trial court allowed the plaintiffs’ motion and disqualified the defendants’ attorney from representing them during the proceeding. The appellate court denied a motion to dismiss the appeal and considered the cause on its merits.

On review, this court rejected the defendants’ argument that the trial court’s disqualification order was governed by the rules of interlocutory appeal pertaining to injunctions and appointment of receivers. (Almon, 380 Ill. at 528-29.) The court noted that the "purpose of an interlocutory injunction is to preserve the rights of some one or more of the parties and continue the property and the rights therein in statu quo until the cause can be disposed of on the merits.” (Almon, 380 Ill. at 529.) The court determined that the disqualification order "has no bearing on the merits of the litigation” and that it was "not of the character” that was intended to be governed by rules permitting an interlocutory appeal from an order granting or denying an injunction. Almon, 380 Ill. at 529.

In addition, this court ruled that the trial court’s disqualification order was not immediately final and appealable. It reasoned as follows:

"A judgment or decree is final and reviewable when it terminates the litigation on the merits of the case and determines the rights of the parties. [Citations.] One of the essential elements of finality of a decree is that if affirmed the only thing remaining to do is to proceed to its execution. [Citations.] The order in question had no bearing on the rights of the defendants as to the matters involved in their litigation with the plaintiffs. They were not deprived of the right to be represented by an attorney, for the order made provision for the substitution of counsel of their own selection. The order appealed from was on a matter collateral to the main issue and not a final and appealable order.” Almon, 380 Ill. at 530-31.)

On this basis, the court concluded that the appellate court should have dismissed the appeal for lack of jurisdiction.

This court has recognized and applied the rule in Almon in subsequent decisions. (People ex rel. Woll v. Graber (1946), 394 Ill. 362, 369; People ex rel. School District No. 88 v. Holland (1943), 384 Ill. 277, 280.) The Almon rule has also been applied by our appellate court. (See, e.g., Transamerica Insurance Co. v. Vassilos (1989), 181 Ill. App. 3d 939, 941; Matsunaga v. Worrell (1988), 169 Ill. App. 3d 681, 682; National Wrecking Co. v. Midwest Terminal Corp. (1987), 164 Ill. App. 3d 621, 624; Leib v. Toulin, Inc. (1983), 113 Ill. App. 3d 707, 720-21; Chicago Title & Trust Co. v. Guaranty Bank & Trust Co. (1978), 59 Ill. App. 3d 362, 364-65; but see Leckrone v. City of Salem (1987), 152 Ill. App. 3d 126 (holding that disqualification order is final and subject to immediate appeal).) However, some reviewing courts have expressed displeasure with the rule and have suggested that this court should overrule it. (See, e.g., National Wrecking, 164 Ill. App. 3d at 624; Chicago Title & Trust, 59 Ill. App. 3d at 365.) For the reasons that follow, we conclude that this court should retain the Almon rule and we reaffirm its continued validity under current civil procedure rules in this State.

Ill

Initially we note that Charles does not seriously challenge the Almon court’s ruling that a disqualification order is not in the nature of injunctive relief from which an immediate appeal is warranted. Although our current rules of procedure specify that injunctive relief may be immediately appealed (134 Ill. 2d R. 307), our jurisprudential interpretations have held that this rule does not encompass orders that do not strictly conform to an award of injunctive relief (see, e.g., Almgren v. Rush-Presbyterian-St. Luke’s Medical Center (1994), 162 Ill. 2d 205). In light of this precedent, it is clear that an order regarding disqualification of counsel is not an interlocutory ruling for injunctive relief from which a party may take an immediate appeal.

Charles contends that the Almon holding should be narrowly construed to pertain only to the question of whether a disqualification order grants injunctive relief from which interlocutory appeal is appropriate. Charles claims that Almon did not decide the separate question of whether a disqualification order is final and appeal-able. Charles’ interpretation of Almon is inaccurate. As noted above, Almon also decided that a disqualification order is not final and appealable (Almon, 380 Ill. at 531 (the disqualification "order appealed from was on a matter collateral to the main issue and was not a final and appealable order”)).

Charles further contends that this court should hold that a disqualification order is a final and appealable ruling. Based upon well-established interpretations of our rules of civil procedure respecting final and appeal-able orders, we find Charles’ claim inconsistent with our precedent. Under our current rules of procedure, Rule 301 states in pertinent part that "[e]very final judgment of a circuit court in a civil case is appealable as of right.” (145 Ill. 2d R. 301.) In general, a final and appealable judgment is defined as one in which the trial court has determined the merits of the parties’ claim, such that the only remaining action is to proceed with execution of the judgment. (In re Marriage of Verdung (1989), 126 Ill. 2d 542, 553; Flores v. Dugan (1982), 91 Ill. 2d 108, 113.) This general definition of a final and appealable order is consistent with the Almon court’s view of a final and appealable judgment.

Our present rules of civil procedure allow for an immediate appeal from a final order that disposes of fewer than all of the claims between all of the parties. (134 Ill. 2d R. 304(a).) This court has explained that a final order under Rule 304(a) " 'must be final in the sense that it disposes of the rights of the parties, either upon the entire controversy or upon some definite and separate part thereof.’ ” (Treece v. Shawnee Community Unit School District No. 84 (1968), 39 Ill. 2d 136, 139, quoting Village of Niles v. Szczesny (1958), 13 Ill. 2d 45, 48.) In addition, this court has defined a claim as "any right, liability or matter raised in an action.” Marsh v. Evangelical Covenant Church of Hinsdale (1990), 138 Ill. 2d 458, 465.

Since the adoption of the principles stated in Rule 304(a), the court has held that a variety of orders, which commonly dispose of less than all of the claims between all of the parties, may be subject to immediate appeal. See, e.g., Marsh, 138 Ill. 2d 458 (award of attorney fees under Rule 137); Burtell v. First Charter Service Corp. (1979), 76 Ill. 2d 427 (accounting); White Way Sign & Maintenance Co. v. Seltzer Pontiac, Inc. (1974), 56 Ill. 2d 342 (garnishment); Hanley v. Hanley (1958), 13 Ill. 2d 209 (accounting); Smith v. Hodge (1958), 13 Ill. 2d 197 (attachment).

We do not believe that a disqualification order falls into the same class as orders that have been held to be immediately appealable upon a proper trial court finding under Rule 304(a). Unlike orders for attachment, garnishment, accounting, or attorney fees, a disqualification order grants no relief with respect to the substantive merits of a claim between the parties that has been raised in the actual controversy between them. Whether an attorney is acting under a conflict of interest that warrants his or her disqualification is not an issue that has a direct or immediate impact on the merits of the rights or liabilities asserted in the litigation pending between the parties. As this court observed in Almon, an attorney’s qualifications to remain as counsel for a litigant involve matters wholly collateral to and independent from the substantive claims postulated by the litigants. (Almon, 380 Ill. at 531.) As a result, we adhere to the ruling in Almon and conclude that a disqualification order is not a final order under Rule 304(a).

Charles contends that principles of fairness to the litigants, as well as the urgent need for immediate appellate review, would support the conclusion that a disqualification order should be subject to immediate appellate review under Rule 304(a). Charles also relies upon remarks of the appellate court that have criticized this court’s Almon ruling with respect to the appeal-ability of a disqualification order (National Wrecking, 164 Ill. App. 3d at 624; Chicago Title & Trust, 59 Ill. App. 3d at 364-65). Further, Charles suggests that disqualification motions provide a prime opportunity for abuse by the litigants. (See Hannan v. Watt (1986), 147 Ill. App. 3d 456, 461-62.) Charles also asserts that a disqualification order should be held as final and appeal-able because an aggrieved litigant who must await the close of trial before appealing the disqualification ruling is effectively denied any meaningful appellate consideration of the trial court’s ruling. Although we are not unmindful of the concerns expressed by Charles, we believe that they are better addressed by the discretion of the trial court in its consideration of whether a particular disqualification motion should be allowed or denied.

We conclude that the trial court’s disqualification order in the instant proceeding was not a final order and that as a result no immediate appeal could be taken therefrom. The trial court’s finding pursuant to Rule 304(a) could not convert its ruling into a final and appealable order. Because the trial court’s order was not immediately appealable, the appellate court was correct when it dismissed the cause for lack of appellate jurisdiction. As a result, we affirm the appellate court’s dismissal of the instant appeal.

In closing, we note that the parties also dispute whether this court should adopt the Federal "collateral order doctrine.” Under the collateral order doctrine, an immediate appeal is allowed for prejudgment orders that "finally determine claims of right separable from, and collateral to, rights asserted in the action, [where the prejudgment orders are] too important to be denied review and too independent of the cause itself to require that appellate consideration be deferred until the whole case is adjudicated.” (Cohen v. Beneficial Industrial Loan Corp. (1949), 337 U.S. 541, 546, 93 L. Ed. 1528, 1536, 69 S. Ct. 1221, 1225-26.) To come within the collateral order rule, an order must satisfy three criteria. These criteria are that the order (1) "conclusively determine[s] the disputed question,” (2) "resolvéis] an important issue completely separate from the merits of the action,” and (3) is "effectively unreviewable on appeal from a final judgment.” (Coopers & Lybrand v. Livesay (1978), 437 U.S. 463, 468, 57 L. Ed. 2d 351, 357-58, 98 S. Ct. 2454, 2458.) In Richardson-Merrell, Inc. v. Koller (1985), 472 U.S. 424, 86 L. Ed. 2d 340, 105 S. Ct. 2757, the United States Supreme Court held that a prejudgment disqualification order does not fall within the collateral order rule because such an order is not effectively unreviewable under Federal law upon an appeal from final judgment. Similarly, under Illinois law, a disqualification order may be reviewed in an appeal from final judgment. (Almon, 380 Ill. 524.) In view of the Supreme Court’s holding in Richardson-Merrell, we conclude that the Federal collateral order doctrine would not validate Charles’ attempt at immediate interlocutory appeal in the present cause. Consequently, we need not and do not reach the question of whether this court should adopt the Federal collateral order doctrine under Illinois civil practice rules.

For the reason's given, the decision of the appellate court is affirmed.

Affirmed.