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Keywords

contractsettlementattorneyappealtrustsustained

contractattorneytrialsustained

Related Cases

Leonard C. Arnold, Ltd. v. Northern Trust Co., 116 Ill.2d 157, 506 N.E.2d 1279, 107 Ill.Dec. 224, 55 USLW 2469

Facts

On November 9, 1981, Glenda Sue Goodman, as mother and next friend of Jason Goodman, hired attorneys Leonard C. Arnold and James H. Canel to represent them in a personal injury claim for injuries Jason sustained at birth. They signed a contingent-fee agreement stipulating that the attorneys would receive one-third of all sums recovered. After a settlement of $900,000 was reached, the attorneys sought approval for their fees, but the court limited their fee for the minor's recovery to 25% based on a local rule, leading to the appeal.

On November 9, 1981, Glenda Sue Goodman, as mother and next friend of Jason Goodman, and her husband, James M. Goodman, hired attorneys Leonard C. Arnold and James H. Canel to represent them and their son in the prosecution of claims for injuries that Jason sustained at his birth on January 20, 1977.

Issue

Is a contingent-fee contract for legal representation entered into on behalf of a minor by his next friend per se unenforceable? Is Rule 9.20(e) of the Nineteenth Judicial Circuit, which places restrictions on the enforcement of some such agreements, a valid exercise of the circuit court's rule-making power?

Two questions are presented: Is a contingent-fee contract for legal representation entered into on behalf of a minor by his next friend per se unenforceable? Is Rule 9.20(e) of the Nineteenth Judicial Circuit (now Rule 14.21(e)), which places restrictions on the enforcement of some such agreements, a valid exercise of the circuit court's rule-making power?

Rule

A contingent-fee agreement entered into on behalf of a minor by his next friend is enforceable unless the terms are unreasonable. Local court rules can validly establish limits on attorney fees in personal injury cases involving minors.

We therefore hold that a contingent-fee agreement, entered into on behalf of a minor by his next friend, is enforceable unless the terms are unreasonable.

Analysis

The court determined that while contingent-fee agreements are generally enforceable, the local rule limiting fees to 25% serves to protect minors and does not conflict with the substantive law. The court emphasized that the rule provides a procedural mechanism for enforcing the restriction on fees and does not prevent attorneys from seeking higher fees if they can justify them.

The circuit court rule does not contradict this principle, but only provides a procedural mechanism for enforcing the restriction embodied in the substantive law.

Conclusion

The court affirmed the appellate court's decision in part and reversed it in part, upholding the circuit court's award of 25% of the minor's recovery to the attorneys and confirming the validity of the local rule.

The appellate court erred, however, in suggesting that the trial judge had to require the attorneys to prove the reasonableness of a fee of 25% or less.

Who won?

The prevailing party was the Northern Trust Company, as the court upheld the local rule limiting attorney fees and affirmed the circuit court's decision.

The appellate court sustained Rule 9.20(e) as consistent with the court's duty to protect the estates of minors.

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