Richard Korn and Sarah Mangelsdorf recently obtained a favorable ruling on behalf of their clients, a group of attorneys who worked together as part of an office-sharing arrangement. Richard and Sarah represented the defendants in a legal malpractice lawsuit filed in the Circuit Court of Whiteside County, Illinois. In essence, plaintiffs, a limited liability corporation and an individual, alleged that an individual attorney within defendants’ office sharing arrangement misappropriated certain funds arising out of a real estate transaction between the corporate defendant and a third-party, thereby causing financial harm to both the corporate plaintiff and the individual plaintiff. In their Complaint, plaintiffs alleged in excess of $2,700,000.00 in damages.
After approximately four years of litigation, plaintiffs filed a Motion to Amend the Complaint in order to add additional claims against the defendants. Richard and Sarah successfully opposed plaintiffs’ Motion to Amend the Complaint, arguing that the additional counts brought by plaintiffs were new claims that did not relate back to the original Complaint and that these new claims were barred by the statute of limitations and/or statute of repose applicable under Illinois law to professional liability claims against attorneys. In addition, Richard and Sarah successfully argued that the corporate plaintiff did not have statutory authority to maintain a lawsuit in Illinois because it was not an Illinois corporation registered to do business within the State of Illinois. As a result, the corporate plaintiff abandoned all of its claims against the defendants.
Richard and Sarah subsequently filed a Motion for Summary Judgment as to the remaining claims brought by the individual plaintiff, arguing that defendants are entitled to summary judgment as a matter of law because an attorney-client relationship did not exist between the individual plaintiff and the defendants. Plaintiff also filed a Motion for Summary Judgment arguing the individual plaintiff was entitled to summary judgment because he was a third-party beneficiary of the real estate transaction between the corporate defendant and the third-party. The court heard oral argument on both motions and issued its Opinion and Order denying Plaintiff’s Motion for Summary Judgment and granting Defendants’ Motion for Summary Judgment.