CBA Record July-August 2015

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CBA RECORD 49
ETHICS EXTRA
BY BRANDON DJONLICH
Brandon Djonlich is a 2015
graduate of The John Marshall
Law School, where he was a
Morrissey Scholar
Attorney Malpractice Statute of Repose:
Applies to Non-Clients and Clients
T he law was well–settled before Evan-
ston Insurance v. Riseborough, 2014
IL 114271, that the statute of repose
in Section 13-214.3 of the Illinois Code of
Civil Procedure (735 ILCS 5/13.214.3)
applied to claims against lawyers for pro-
fessional misconduct asserted by clients.
Whether the statute applied to claims
against lawyers for professional misconduct
asserted by non-clients was unsettled. That
issue is no longer unsettled. In Evanston
Insurance the Illinois Supreme Court
rejected the holdings of Illinois appellate
courts and federal courts that limited the
statute of repose to claims against lawyers
for professional misconduct asserted by
clients. Evanston Insurance held that the
statute of repose applies to claims against
lawyers for professional misconduct by
both clients and non-clients.
Section 13-214.3, is both a statute of
limitations and a statute of repose. A cause
of action for professional misconduct by
lawyers accrues for purposes of the statute
of limitations when the potential plaintiff
knows or reasonably should know that
a wrong was committed and thus must
make inquiry as to whether the potential
plaintiff has a cause of action. A cause of
action accrues for purposes of the statute
of repose when the lawyer commits the
misconduct. Under Evanston Insurance , the
statute of limitations and statue of repose
under Section 13-214.3 applies to both
clients and non–clients.
Brief Summary
In Evanston Insurance, in 1996, an employee
of a subcontractor for the construction of
a warehouse was injured. The injured
workman brought a personal injury action
against general contractor, Kiferbaum
Construction (the Corporation) for the
injuries incurred on the job. Defendant
law firm, Jacobson & Riseborough (Rise-
borough) represented the Corporation. At
the time of the accident the Corporation
was a named insured under a number of
insurance policies. Evanston Insurance
Company had named the Corporation
as an additional insured under the sub-
contractors’ policies. Evanston Insurance
Company, 2014 IL 114271 at 2.
In 2000, the parties reached a settle-
ment in the personal injury case. The
insurers, however, disagreed as to who was
responsible under the various policies. The
insurers entered into an agreement, referred
to by the parties as the “Fund and Fight
Agreement,” in which they agreed to con-
tribute their respective policy limits to the
fund settlement. Riseborough signed the
agreement as the “duly authorized agent
and representative of [the Corporation].”
Id. at 2.
In 2003, the Corporation’s president
filed an affidavit stating that he had no
knowledge of the “Fund and Fight Agree-
ment” at the time of its creation and that
the attorney, George Riseborough, lacked
authorization to sign the agreement on
behalf of the Corporation. Id. at 3. In
2009, the Corporation moved for sum-
mary judgment on the coverage issue. The
trial court entered judgment in favor of
the Corporation and against the insurer,
finding that the Corporation had not given
authority to Riseborough to sign the “Fund
and Fight Agreement” on its behalf. Id.
While the insurance coverage proceedings
were still pending, on December 22, 2005,
insurer Evanston filed a complaint against
Riseborough. Evanston alleged breach of
an implied warranty of authority, fraudu-
lent misrepresentation, and negligent
misrepresentation based on Riseborough’s
wrongful execution of the “Fund and Fight
Agreement.” Id. The trial court dismissed
Evanston’s complaint without prejudice
because the insurance coverage proceedings
were still pending. Id. at 4.
In 2009, Evanston filed an amended
complaint reasserting its claims against
Riseborough. Riseborough filed a motion
for summary judgment, which the trial
court granted on the basis that the action
was barred by the six-year statute of repose.
Id. The Appellate Court reversed. Id. The
Supreme Court reversed the Appellate
Court and affirmed the trial court’s dis-
missal. It held that the statute of repose of
Section 13-214.3 is not limited to claims
asserted by a client, but also applies to
claims asserted by non-clients. Id. at 14.
Statute of Repose: Client and Non-Client
Claims
Under Section 13-214.3, an action for
damages based on tort, contract, or oth-
erwise (i) against an attorney arising out
of an act or omission in the performance
of professional services *** may not be
commenced *** more than six years after
the date on which the act or omission
occurred.” 735 ILCS 5/13-214.3 (b), (c)
(West 2008).
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