Stoller v. Stoller

582 N.E.2d 1323, 222 Ill. App. 3d 22
CourtAppellate Court of Illinois
DecidedNovember 15, 1991
DocketNo. 1—90—3146
StatusPublished
Cited by1 cases

This text of 582 N.E.2d 1323 (Stoller v. Stoller) 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
Stoller v. Stoller, 582 N.E.2d 1323, 222 Ill. App. 3d 22 (Ill. Ct. App. 1991).

Opinion

JUSTICE LaPORTA

delivered the opinion of the court:

Plaintiff, Leo Stoller, appeals an interlocutory order of the circuit court of Cook County which denied his request for vacatur and a stay of a previously entered arbitration award. Plaintiff initiated this action in chancery to challenge the award made by the arbitrators who had been appointed to adjudicate an intrafamily dispute over the ownership of Stealth Industries, Inc., a corporation in which the plaintiff and the individual defendants, Russell and Christopher Stoller, claimed an interest.

In his complaint, plaintiff asserted that the arbitrators who had been appointed and had decided the dispute between the parties should have been disqualified based upon conflicts of interest which arose as a result of their legal representation of the plaintiff and defendants. The trial court issued an interlocutory order which held that the conduct of the arbitrators did not, as a matter of law, constitute a conflict of interest. The court’s order denied the relief requested by plaintiff and continued the matter for an evidentiary hearing on the factual allegations raised in plaintiff’s complaint. Pursuant to Supreme Court Rule 307 (134 Ill. 2d R. 307), plaintiff filed a notice of appeal of the interlocutory order refusing his request for vacatur and for a stay of the arbitrators’ award.

On appeal, plaintiff contends that (1) the trial court improperly narrowed the scope of its inquiry to a question of law; (2) the precedent relied upon by the trial court in entering its interlocutory order applies exclusively to umpires and not to arbitrators; (3) the precedent relied upon by the trial court does not apply to the instant case; (4) plaintiff was entitled to a stay of the arbitration award; (5) the trial court erred in finding that the appointed arbitrators need not have been disqualified, as a matter of law, based upon conflicts of interest as a result of their legal representation of the parties; and (6) the award entered by the arbitrators should be set aside.

The record indicates that on November 6, 1989, plaintiff and the individual defendants entered into a "written agreement under which the parties submitted their disputes as to the ownership and operation of Stealth Industries, Inc., to binding arbitration before George N. Leighton, George Feiwell, and Ronald H. Balsón as arbitrators. The agreement provided, in relevant part, as follows:

“Each of LEO, RUSSELL and CHRISTOPHER hereby acknowledge that GEORGE N. LEIGHTON, GEORGE FEIWELL and RONALD H. BALSON have each rendered legal services to them, or on their behalf. Each of LEO, RUSSELL, and CHRISTOPHER hereby waive any and all claims of privilege or of conflict of interest and specifically request that these arbitrators accept said appointment and assist in their dispute resolution.”

The agreement stated further:

“It is the intent of the parties to resolve pending legal matters. They shall enlist the assistance of Messrs. LEIGHTON, FEIWELL and BALSON to assist them. The parties shall cause STEALTH to promptly and timely pay all statements rendered from Messrs. LEIGHTON, FEIWELL and BALSON.”

On December 18, 1989, the arbitration convened pursuant to the terms of the agreement. The parties were present along with Leighton and Balsón, but Feiwell did not appear. The parties agreed on the record to proceed with the arbitration and to have their dispute resolved by only two arbitrators, Leighton and Balsón. At the commencement of the arbitration, each of the parties specifically stated that he had waived any right to assert privilege or a conflict of interest which might have existed as a result of the legal representation of any or all of the parties by Leighton and Balsón. All of the parties stated that they voluntarily chose to proceed with the arbitration without any objection. The parties also stated that they understood that they had the right to have an attorney present to represent their individual interests during the arbitration but chose to proceed without counsel.

After considering the proofs and testimony submitted by.the parties, the arbitrators issued their award of arbitration dated January 31, 1990. The award of arbitration reflected that the arbitrators found that Russell Stoller was the sole shareholder of Stealth Industries, Inc., with the sole right and authority to operate the corporation and that neither Leo Stoller nor Christopher Stoller had an ownership interest in the corporation.

Plaintiff, Leo Stoller, subsequently requested that the arbitrators’ award be modified and clarified. On March 14, 1990, the arbitrators denied plaintiff’s request, for modification and clarification of the award.

On May 30, 1990, plaintiff filed in the circuit court a motion for a stay pendente lite of the private arbitrators’ award dated January 31, 1990. This motion was stricken by the trial court, but plaintiff was granted leave to file an amended motion. On July 9, 1990, Leo filed his brief in support of his motion for a stay pendente lite of the arbitrators’ award and for restraining and removal orders against defendants Russell Stoller and Christopher Stoller. The trial court allowed plaintiff’s brief to stand as his motion.

On August 6, 1990, the individual defendants filed their response to the plaintiff’s motion for a stay pendente lite of the arbitrators’ award. On August 8, 1990, plaintiff filed his verified first amended complaint to stay and vacate the arbitrators’ award and for declaratory judgment and for other relief. On August 13, 1990, plaintiff filed his reply to the defendants’ response to plaintiff’s motion for stay pendente lite of the arbitrators’ award and for restraining and removal orders against Russell and Christopher Stoller.

At the hearing on plaintiff’s motion for a stay of the arbitrators’ award, plaintiff asserted that the arbitrators had acted under a conflict of interest and that, as a matter of law, they could not represent him and also act as neutral arbitrators. The trial court indicated that the record was insufficient to support the issuance of a stay on grounds other than the assertion of a conflict of interest as a matter of law. The court continued the matter for further briefing and argument on this issue and scheduled a hearing for October 12, 1990, to determine whether this issue was determinative of the plaintiff’s motion for a stay.

Russell and Christopher filed a memorandum of law addressing this issue, and plaintiff filed a supplemental brief in support of his motion. Upon consideration of the briefs and arguments of the parties, the trial court concluded that the arbitrators in the instant case did not, as a matter of law, act under a conflict of interest merely because they had previously represented the parties involved in the dispute. The court based its decision upon the reasoning employed in Strong v. International Building Loan & Investment Union (1899), 183 Ill. 97, 55 N.E. 675, which held that the law recognizes an exception to the conflict of interest rule where an attorney acts as an umpire. On this basis, the trial court denied plaintiff’s request for an immediate stay of the arbitrators’ award. The trial court went on to indicate that there may be further questions of fact to be decided before a final determination of the conflict of interest issue can be made.

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Bluebook (online)
582 N.E.2d 1323, 222 Ill. App. 3d 22, Counsel Stack Legal Research, https://law.counselstack.com/opinion/stoller-v-stoller-illappct-1991.