Ring v. Schencker

2021 IL App (1st) 180909-U
CourtAppellate Court of Illinois
DecidedJune 28, 2021
Docket1-18-0909
StatusUnpublished

This text of 2021 IL App (1st) 180909-U (Ring v. Schencker) 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
Ring v. Schencker, 2021 IL App (1st) 180909-U (Ill. Ct. App. 2021).

Opinion

2021 IL App (1st) 180909-U No. 1-18-0909 Order filed June 28, 2021

FIRST DIVISION

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

BARRY RING ) Appeal from the Circuit Court ) Of Cook County. Plaintiff-Appellant/Cross-Appellee, ) ) ) No. 15 L 005404 v. ) ) The Honorable RICHARD SCHENCKER, Individually and ) Thomas R. Mulroy d/b/aRICHARD L. SCHENCKER, LTD. and ) Judge Presiding. RICHARD L. SCHENCKER, Attorney and ) Counselor, ) ) Defendant-Appellee/Cross-Appellant.)

PRESIDING JUSTICE WALKER delivered the judgment of the court. Justice Coghlan concurred in the judgment. Justice Hyman specially concurred.

ORDER

¶1 HELD: The manifest weight of the evidence sufficiently supports the trial court’s finding that Plaintiff-Appellant failed to prove damages due to Defendant-Appellee’s alleged breach of duties. The trial court did not abuse its discretion when it imposed sanctions against Plaintiff-Appellant under Rule 137 and limited the award to fees for the trial and posttrial proceedings. No. 1-18-1225

¶2 Barry Ring sued Richard Schencker for legal malpractice, alleging that Richard divulged

Barry’s secrets to attorneys working against Barry in Barry’s divorce litigation. The trial court

entered judgment in favor of Richard after a bench trial, and imposed sanctions on Barry under

Supreme Court Rule 137 (Ill. S. Ct. R. 137 (eff.)). In his appeal, Barry argues the court relied

on evidence stricken from the record, the court impermissibly restricted expert testimony, and

the court’s findings are contrary to the manifest weight of the evidence. Richard cross-appeals,

arguing that the court awarded insufficient fees. We find that the court did not rely on the

stricken evidence, Barry did not show prejudice from the restriction on expert testimony, and

the evidence sufficiently supports the court’s finding that Barry failed to prove Richard’s

actions caused any damages. On the cross-appeal, we find that the court did not abuse its

discretion in the imposition of the sanction the court chose.

¶3 I. BACKGROUND

¶4 Barry Ring and Carol Schencker signed a prenuptial agreement and married in 2009. For

several business transactions, Carol’s father, Richard Schencker, acted as Barry’s attorney and

as attorney for business entities Barry created. Carol filed a complaint for dissolution of the

marriage in May 2013. Richard immediately notified Barry that Richard would no longer serve

as Barry’s attorney.

¶5 Carol filed a motion for a temporary restraining order (TRO) to prevent Barry from hiding

his assets. She alleged,

“on June 21, 2013, *** Barry depleted the parties' only joint checking account and

deliberately cut Carol off from credit cards which she historically relied on in order to pay

expenses for herself and the parties' two minor children. Further, Barry is attempting to

2 No. 1-18-1225

take out a $1.1 million mortgage on the parties' marital residence claiming that he needs

the funds to expand his medical business.***

Barry has repeatedly threatened Carol that he is ‘taking all of our money and putting it

into the business and he will make sure that all of the money is put into the business.’ Barry

has also threatened that he would ‘put himself out of business, close all of his businesses

and be a stay-at-home dad’ by claiming that he ‘does not need a lot to live on.’

Within the last two weeks, Barry told Carol ‘I will fuck you and your lawyer’ and that

it will be ‘fun for me.’”

The divorce court entered an initial restraining order on June 25, 2013, modified first on July

3, 2013, and further modified in subsequent orders. Carol and Barry settled most of the

financial issues in the divorce by March 2014.

¶6 In May 2015, before entry of the final judgment in the divorce case, Barry sued Richard

for legal malpractice. Much of the complaint focused on Richard’s role in helping Barry set

up a corporation, Colvel Investments, LLC, to acquire real estate in Indiana that Barry intended

to use for his practice as a doctor specializing in pain management. As part of Barry’s plan to

keep his intentions secret from potential competitors, Barry asked Carol to act as legal owner

of Colvel, using her maiden name on documents for Colvel’s incorporation and for Colvel’s

acquisition of real estate. According to Barry, despite Carol’s role as owner, “everyone

involved understood and agreed that [Barry] would remain in control of Colvel.”

¶7 Barry alleged in his amended complaint:

“[Richard] disclosed confidential information about Barry and his business interests to

Carol and the attorneys representing her in the Divorce.

3 No. 1-18-1225

***

Included in the information Schencker learned as Barry's attorney and subsequently

improperly disclosed over email was the equity in Barry's business interests, which

Schencker additionally utilized in assisting Carol to prepare a Disclosure Statement listing

Barry Ring's business interests to be filed in the Divorce.

Schencker also provided to Carol's attorneys in the Divorce information regarding

negotiations he conducted as counsel on Barry's behalf regarding the acquisition of vacant

property in Indiana. ***

Schencker even disclosed to Carol's attorneys certain legal and business strategies

Barry used to deal with competitive entities ***.

Schencker advised Carol's divorce attorneys early in the divorce that Carol was

involved in the ownership and control of Colvel and that this could be used to gain leverage

against Barry. As a result, Carol's divorce attorneys used Carol's role with Colvel to obtain

a $400,000 settlement payment for Carol in exchange for, among other things, ending any

litigation over the ownership and/or control of Colvel.”

¶8 The bench trial on the malpractice complaint began in February 2018, more than a year

after the divorce court entered its final judgment. Expert witnesses for Barry testified that

Richard’s emails to Carol’s attorneys showed that Richard violated his duties as Barry’s

attorney. Richard’s own expert admitted that at least one email appeared to violate Richard’s

ethical duties to his former client. The trial court accepted the written statements of the parties

as to their expert’s opinions and limited the expert testimony at trial to cross-examination.

4 No. 1-18-1225

¶9 Enrico Mirabelli, the attorney who represented Barry in the divorce, testified that the

original restraining order, entered on June 25, 2013, “pretty much locked up all of Dr. Ring’s

accounts and ability to do business ***. *** [T]he banks *** weren’t allowing Dr. Ring to

write checks.” The modifications entered in July 2013 eased the restrictions and permitted

Barry to pay his employees, “but his ability to mortgage, hypothecate, loan, transfer property,

real estate was still tied up.” The modified order “prevent[ed] Dr. Ring from proceeding with

his plan to build on the property in Hobart, Indiana.” Because of the continuing restrictions

and Carol’s extensive knowledge of Barry’s real estate interests, Mirabelli worked to “[g]et

the case settled on the property issue as quickly as possible.” To that end, Mirabelli persuaded

Barry to give Carol “a payment of 400,000 that was nowhere to be found in the prenup.”

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2021 IL App (1st) 180909-U, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ring-v-schencker-illappct-2021.