{ "id": 3554158, "name": "RONALD ACHS, Plaintiff-Appellant and Cross-Appellee, v. CHARLES MADDOX, Defendant (Peter Thomas Smith et al., Petitioners-Appellees and Cross-Appellants)", "name_abbreviation": "Achs v. Maddox", "decision_date": "1988-11-03", "docket_number": "No. 2-88-0105", "first_page": "989", "last_page": "996", "citations": [ { "type": "official", "cite": "175 Ill. App. 3d 989" } ], "court": { "name_abbreviation": "Ill. App. Ct.", "id": 8837, "name": "Illinois Appellate Court" }, "jurisdiction": { "id": 29, "name_long": "Illinois", "name": "Ill." }, "cites_to": [ { "cite": "199 N.E.2d 827", "category": "reporters:state_regional", "reporter": "N.E.2d", "weight": 2, "pin_cites": [ { "page": "830" } ], "opinion_index": 0 }, { "cite": "49 Ill. App. 2d 1", "category": "reporters:state", "reporter": "Ill. App. 2d", "case_ids": [ 5273975 ], "weight": 2, "pin_cites": [ { "page": "6-7" } ], "opinion_index": 0, "case_paths": [ "/ill-app-2d/49/0001-01" ] }, { "cite": "519 N.E.2d 898", "category": "reporters:state_regional", "reporter": "N.E.2d", "opinion_index": 0 }, { "cite": "119 Ill. 2d 485", "category": "reporters:state", "reporter": "Ill. 2d", "case_ids": [ 3193254 ], "pin_cites": [ { "page": "490" } ], "opinion_index": 0, "case_paths": [ "/ill-2d/119/0485-01" ] }, { "cite": "475 N.E.2d 872", "category": "reporters:state_regional", "reporter": "N.E.2d", "opinion_index": 0 }, { "cite": "105 Ill. 2d 486", "category": "reporters:state", "reporter": "Ill. 2d", "case_ids": [ 3141899 ], "pin_cites": [ { "page": "500" } ], "opinion_index": 0, "case_paths": [ "/ill-2d/105/0486-01" ] }, { "cite": "279 N.E.2d 759", "category": "reporters:state_regional", "reporter": "N.E.2d", "weight": 2, "pin_cites": [ { "page": "764" } ], "opinion_index": 0 }, { "cite": "3 Ill. App. 3d 1015", "category": "reporters:state", "reporter": "Ill. App. 3d", "case_ids": [ 2836179 ], "weight": 2, "pin_cites": [ { "page": "1020" } ], "opinion_index": 0, "case_paths": [ "/ill-app-3d/3/1015-01" ] }, { "cite": "790 F.2d 574", "category": "reporters:federal", "reporter": "F.2d", "case_ids": [ 1579042 ], "year": 1982, "opinion_index": 0, "case_paths": [ "/f2d/790/0574-01" ] }, { "cite": "525 N.E.2d 151", "category": "reporters:state_regional", "reporter": "N.E.2d", "weight": 3, "year": 1986, "pin_cites": [ { "page": "153-54" }, { "page": "154" } ], "opinion_index": 0 }, { "cite": "170 Ill. App. 3d 720", "category": "reporters:state", "reporter": "Ill. App. 3d", "case_ids": [ 3584621 ], "weight": 3, "year": 1986, "pin_cites": [ { "page": "724" }, { "page": "724-25" } ], "opinion_index": 0, "case_paths": [ "/ill-app-3d/170/0720-01" ] }, { "cite": "691 F.2d 828", "category": "reporters:federal", "reporter": "F.2d", "case_ids": [ 1477907 ], "weight": 2, "opinion_index": 0, "case_paths": [ "/f2d/691/0828-01" ] }, { "cite": "191 N.E. 56", "category": "reporters:state_regional", "reporter": "N.E.", "weight": 5, "pin_cites": [ { "page": "61" }, { "page": "58" }, { "page": "61" } ], "opinion_index": 0 }, { "cite": "356 Ill. 467", "category": "reporters:state", "reporter": "Ill.", "case_ids": [ 5804504 ], "weight": 5, "pin_cites": [ { "page": "477-78" }, { "page": "471" }, { "page": "478" } ], "opinion_index": 0, "case_paths": [ "/ill/356/0467-01" ] }, { "cite": "417 N.E.2d 1045", "category": "reporters:state_regional", "reporter": "N.E.2d", "weight": 4, "year": 1934, "pin_cites": [ { "page": "1048" }, { "page": "1048-49" } ], "opinion_index": 0 }, { "cite": "93 Ill. App. 3d 390", "category": "reporters:state", "reporter": "Ill. App. 3d", "case_ids": [ 3131899 ], "weight": 4, "year": 1934, "pin_cites": [ { "page": "394" }, { "page": "394" }, { "page": "394" } ], "opinion_index": 0, "case_paths": [ "/ill-app-3d/93/0390-01" ] }, { "cite": "65 N.E. 690", "category": "reporters:state_regional", "reporter": "N.E.", "year": 1981, "opinion_index": 0 }, { "cite": "200 Ill. 84", "category": "reporters:state", "reporter": "Ill.", "case_ids": [ 5592871 ], "year": 1981, "pin_cites": [ { "page": "92" } ], "opinion_index": 0, "case_paths": [ "/ill/200/0084-01" ] } ], "analysis": { "cardinality": 710, "char_count": 16436, "ocr_confidence": 0.769, "pagerank": { "raw": 7.25138546006382e-08, "percentile": 0.43236516878011033 }, "sha256": "47d893e45f588d17cd1ed08fbf1573d22afb54ee8412297668ae3a5919aa147e", "simhash": "1:b37f564a6fb2dc5c", "word_count": 2693 }, "last_updated": "2023-07-14T17:24:13.630237+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [], "parties": [ "RONALD ACHS, Plaintiff-Appellant and Cross-Appellee, v. CHARLES MADDOX, Defendant (Peter Thomas Smith et al., Petitioners-Appellees and Cross-Appellants)." ], "opinions": [ { "text": "JUSTICE REINHARD\ndelivered the opinion of the court:\nPetitioners, attorneys Peter Thomas Smith and Leonard M. Ring and Associates, represented plaintiff Ronald Achs, pursuant to a written contingent fee agreement in the litigation of a personal injury suit against Charles Maddox. After entry of a judgment in Achs\u2019 favor for $12,142.72 following a jury trial, petitioners filed a motion in the circuit court requesting a finding of attorney liens in the amount of $4,047.57 for fees and $6,751.91 for costs incurred by petitioners. The circuit court found that petitioners held equitable attorney liens and entered judgment for petitioners in the amount of $4,014 for fees and $1,986 for costs in the proceeds of a check issued in satisfaction of the judgment against Maddox. Achs appeals, and petitioners cross-appeal the trial court\u2019s finding of a lien for only a portion of the costs petitioners claim were incurred.\nOn September 11, 1984, plaintiff Ronald Achs and petitioner Peter Thomas Smith executed an agreement under which Achs employed Smith to act as his attorney in connection with Achs\u2019 claim for personal injuries and property damage arising from a motor vehicle accident in De Kalb County on September 5, 1984. The agreement contained the following provisions:\n\u201c2. COMPENSATION: CLIENT agrees to pay a contingent fee for legal services rendered based upon a percentage of the amount recovered or settlement obtained payable as follows: 331/3% percent of whatever may be recovered from said claim, either by suit, settlement or in any manner. The contingent fee shall be determined prior to deduction for costs advanced. ***\n3. COSTS AND EXPENSES: CLIENT further agrees to reimburse ATTORNEY for any and all necessary costs and expenses incurred or paid out in behalf of CLIENT in connection with the legal services rendered. CLIENT shall reimburse ATTORNEY for said costs or expenses on a monthly basis unless otherwise agreed in writing.\n* * *\n6. RETENTION OF RECOVERY: CLIENT agrees that ATTORNEY may receive any recovery pursuant to a settlement or a judgment and that he may retain therefrom any fee and reimbursement of expenses as provided above before disbursing the remainder to CLIENT. ***\n***\n8. ATTORNEY LIEN: CLIENT agrees that ATTORNEY shall have a lien upon all claims, demands and causes of action, including all claims for unliquidated damages, which may be placed in their [sic] hands by CLIENT for suit or collection, or upon which suit or action has been instituted, for the amount of any fee which may have been agreed upon by and between ATTORNEY and CLIENT.\u201d\nOn February 14, 1985, a complaint was filed against Charles Maddox in connection with the September 5 collision. On October 1, 1985, at the request of Achs, Smith entered into an agreement with petitioner Leonard M. Ring and Associates under which Leonard M. Ring and Associates accepted primary responsibility for litigating Achs\u2019 claim against Maddox. On August 27, 1986, judgment was entered on the jury verdict in favor of Achs in the amount of $12,142.72.\nOn September 9, 1986, Leonard M. Ring and Associates received a check for the full amount of the judgment, payable to Ronald A. Achs and Leonard M. Ring and Associates. Achs never endorsed the check and on January 9, 1987, he filed a voluntary petition for relief under chapter 7 of the Bankruptcy Code in Bankruptcy Court for the Northern District of Illinois. The petition listed Leonard M. Ring and Associates as creditors having unsecured claims without priority in the amount of $10,349.48 for costs and fees in connection with the suit against Maddox.\nSubsequent to the filing of the bankruptcy petition, petitioners forwarded a notice of attorney\u2019s lien to the attorney representing Achs in the bankruptcy proceeding. On June 11, 1987, the bankruptcy court approved the bankruptcy trustee\u2019s report that there were no assets in the estate to be administered for the benefit of creditors. On September 11, 1987, petitioners filed their petition in the circuit court of De Kalb County to adjudicate costs, liens, and fees, attaching to their petition an itemized list of expenses incurred in the litigation.\nIn connection with the petition, Achs and petitioners submitted affidavits giving somewhat conflicting accounts of the circumstances surrounding the execution of the attorney-client agreement. These affidavits disclose that Peter Thomas Smith was contacted by Ronald Achs\u2019 brother, Stephen Achs, on September 5, 1984, and met with him at the accident site the next morning; that Smith engaged an accident investigator to review the accident site; and that on September 11, 1984, shortly after Ronald Achs was released from hospitalization, Smith met with Achs at Achs\u2019 apartment at which time the attorney-client agreement was executed.\nAn affidavit by Smith stated that he reviewed the terms of the contingent fee agreement with Achs and that the agreement was executed after Smith was satisfied that Achs understood its terms. Ronald Achs\u2019 affidavit stated that at the time of the meeting with Smith, Achs was fatigued and uncomfortable due to prescribed medication and that he was not advised of the specific terms of the contingent fee agreement or provided with a copy of the agreement.\nThe following issues are raised on appeal and on the cross-appeal: (1) whether the attorney-client agreement supports the existence of an equitable lien in favor of petitioners for fees and costs; (2) whether the attorney-client agreement was enforceable; (3) whether petitioners had a valid statutory attorney lien; and (4) whether the trial court erred in failing to find an attorney lien for the full amount of costs claimed by petitioners.\nAchs contends on appeal that petitioners had no valid equitable lien and that, therefore, his liability to petitioners for fees and costs was an unsecured obligation which was discharged in bankruptcy. He concedes that if equitable liens were created, they were unaffected by the bankruptcy proceedings.\nThe trial court found that petitioners had an equitable lien on the proceeds of the check received from Charles Maddox\u2019 insurer. In Illinois, in addition to a statutory attorney lien, an attorney may have an equitable lien where the agreement between attorney and client constitutes an equitable assignment of a portion of a fund obtained for the client. (Cameron v. Boeger (1902), 200 Ill. 84, 92, 65 N.E. 690; Department of Public Works v. Exchange National Bank (1981), 93 Ill. App. 3d 390, 394, 417 N.E.2d 1045.) According to Lewis v. Braun (1934), 356 Ill. 467, 191 N.E. 56, \u201c[a]n equitable assignment is such an assignment as gives the assignee a title which, though not cognizable at law, equity will recognize and protect. [Citation.] There must be an implied appropriation of the fund, or of some designated part, proportion or percentage of it, to act as an equitable assignment.\u201d 356 Ill. at 477-78,191 N.E. at 61.\nAchs maintains that the language of the attorney-client agreement entered into with Smith did not work an equitable assignment. Achs correctly points out that there is a clear distinction between an assignment of a portion of a fund and a mere personal promise to pay attorney fees in an amount equal to a portion of a fund recovered or collected. (See Department of Public Works, 93 Ill. App. 3d at 394, 417 N.E.2d at 1048.) Whether an attorney-client agreement creates an equitable assignment turns on the precise language of the agreement. McKee-Berger-Mansueto, Inc. v. Board of Education (7th Cir. 1982), 691 F.2d 828.\nIn Department of Public Works v. Exchange National Bank (1981), 93 Ill. App. 3d 390, 417 N.E.2d 1045, cited by Achs, an agreement stating that attorneys in an eminent domain proceeding were to be paid \u201can amount equal to 28% of the increase obtained from the condemning body over the amount of $132,200.00\u201d was held not to constitute an equitable assignment. In that case the agreement merely specified that the amount due as attorney fees would be determined by the amount recovered and did not purport to give the attorneys any rights against the actual fund recovered. 93 Ill. App. 3d at 394, 417 N.E.2d at 1048-49.\nIn contrast, in Lewis v. Braun (1934), 356 Ill. 467, 191 N.E. 56, an agreement stating that \u201c[o]n the total amount recovered up to the sum or value of $65,000 the fee and payment for services shall be 20 percent thereof\u201d was held to constitute an equitable assignment. (356 Ill. at 471, 191 N.E. at 58.) Because the agreement \u201cimposes the compensation directly onto the res, so the implication of lien in justice to the attorney necessarily applies.\u201d (356 Ill. at 478, 191 N.E. at 61.) In Home Federal Savings & Loan Association v. Cook (1988), 170 Ill. App. 3d 720, 525 N.E.2d 151, an agreement granting attorneys \u201ca contingent fee of 40% \u201d of any monies recovered was held to create an equitable .assignment. 170 Ill. App. 3d at 724, 525 N.E.2d at 153-54; see also In re Brass Kettle Restaurant, Inc. (7th Cir. 1986), 790 F.2d 574; McKee-Berger-Mansueto, Inc. v. Board of Education (7th Cir. 1982), 691 F.2d 828.\nAchs cites Anastos v. O\u2019Brien (1972), 3 Ill. App. 3d 1015, 279 N.E.2d 759, for the proposition that a contingent fee agreement is not an assignment to the attorney of any interest in the subject matter of the litigation. The issue before the court in Anastos, however, was whether a contingent fee agreement vest\u00e9d an attorney with such an interest in the litigation as to allow the attorney to compel the continuation of the litigation despite his client\u2019s desire to settle. Anastos does not hold that an attorney may not obtain rights in the proceeds of litigation under a contingent fee agreement. 3 Ill. App. 3d at 1020, 279 N.E.2d at 764.\nTurning to the agreement between Achs and Smith, Achs contends that because the agreement states that the attorney fee is to be \u201cbased upon\u201d the amount recovered, the agreement is merely a personal promise to pay an amount determined by the amount recovered. However, paragraph 2 of the attorney-client agreement states, in pertinent part, that the contingent fee is \u201cpayable as follows: 331/s% percent of whatever may be recovered from said claim.\u201d This language indicates that petitioners were to look directly to the fund recovered for payment of their fees, and thus constitutes an equitable assignment. (See Home Federal Savings & Loan Association, 170 Ill. App. 3d at 724-25, 525 N.E.2d at 154.) Furthermore, paragraph 8 of the agreement, which purports to grant petitioners a lien for fees upon their client\u2019s claims, supports our conclusion that the agreement gave petitioners an interest in the recovery.\nAchs has also argued that the agreement between Smith and Achs is unenforceable. Achs claims that an attorney-client relationship existed between Smith and Achs prior to the execution of the contingent fee agreement and, therefore, the agreement is presumptively unenforceable. Achs claims that petitioners did not rebut this presumption. While the record contains affidavits bearing upon the circumstances surrounding the execution of the agreement, we find nothing in the record before us that suggests that the issue as now argued was ever raised in or ruled upon by the trial court. Questions not raised at trial are deemed waived and may not be raised for the first time on appeal. Western Casualty & Surety Co. v. Brochu (1985), 105 Ill. 2d 486, 500, 475 N.E.2d 872.\nAs we conclude that the trial court correctly found an equitable lien for petitioners\u2019 fees, we need not determine further whether petitioners established a valid statutory lien for fees.\nWe consider next whether any equitable lien extends to petitioners\u2019 costs. The agreement states, in part, in section 3 that \u201cCLIENT further agrees to reimburse ATTORNEY for any and all necessary costs and expenses incurred ***. CLIENT shall reimburse ATTORNEY for said costs and expenses on a monthly basis unless otherwise agreed in writing.\u201d This provision clearly creates a personal obligation on the part of Achs to reimburse petitioners for expenses incurred as is required by Rule 5 \u2014 103 of the Code of Professional Responsibility (Code) (107 Ill. 2d R. 5 \u2014 103), which provides that a client must remain ultimately liable for expenses. The provision does not provide that expenses were to be reimbursed from the fund recovered. Moreover, such an interpretation would be inconsistent with the agreement that expenses were to be reimbursed on a monthly basis.\nPetitioners contend, nevertheless, that Rule 5 \u2014 103 of the Code gives an attorney a proprietary interest in his client\u2019s cause of action to the extent of expenses advanced. We find no support for this contention. Rule 5 \u2014 103(a) provides:\n\u201c(a) A lawyer may acquire a proprietary interest in the cause of action or subject matter of litigation which he is conducting for a client only by\n(1) acquiring a lien granted by law to secure his fee or expenses; or\n(2) contracting with a client for a reasonable contingent fee in a civil case.\u201d (Emphasis added.) (107 Ill. 2d R. 5\u2014 103(a).)\nThis rule is a limitation on an attorney\u2019s ability to acquire a proprietary interest in his client\u2019s cause of action. (See People ex rel. Brazen v. Finley (1988), 119 Ill. 2d 485, 490, 519 N.E.2d 898.) Under subsection (a)(1), a lawyer may acquire a lien to secure his fee or expenses if granted by law. However, the statutory lien provision in \u201cAn Act creating attorney\u2019s lien and for enforcement of same\u201d (Ill. Rev. Stat. 1987, ch. 13, par. 14) is expressly limited to a lien for fees and does not provide a lien for expenses. Subsection (a)(2) allows an attorney to acquire a proprietary interest in the litigation by contracting for a reasonable contingent fee in a civil case, but does not similarly provide for expenses.\nOn the other hand, Rule 5 \u2014 103(b) of the Code provides:\n\u201c(b) While representing a client in connection with contemplated or pending litigation, a lawyer shall not advance or guarantee financial assistance to his client, except that a lawyer may advance or guarantee the expenses of litigation, including court costs, expenses of investigation, expenses of medical examination, and costs of obtaining and presenting evidence, provided the client remains ultimately liable for such expenses.\u201d (107 Ill. 2d R. 5 \u2014 103(b).)\nWhile Rule 5 \u2014 103(b) requires that a client must remain ultimately liable for expenses advanced, it does not provide that the liability constitutes a lien on any recovery on behalf of the client. Jordan v. Ray Schools-Chicago, Inc. (1964), 49 Ill. App. 2d 1, 199 N.E.2d 827, cited by petitioners, lends no support to their contention that an attorney acquires a proprietary interest in the cause of action which creates a lien for expenses. The decision merely holds that the predecessor of Rule 5 \u2014 103(b) supported a finding that a client was liable for expenses advanced in good faith by his attorney as a matter of convenience even where the agreement between attorney and client was silent as to who would bear expenses. 49 Ill. App. 2d at 6-7, 199 N.E.2d at 830.\nPetitioners further note that paragraph 6 of the agreement authorized them to receive any judgment recovered on Achs\u2019 behalf and to retain reimbursement for expenses from it before distributing the remainder to Achs. While this provision creates a procedure by which petitioners may collect any recovery and retain any fee and expenses advanced, it does not establish a proprietary interest for expenses in the recovery, nor would such an interest be allowed under Rule 5 \u2014 103(aX2) of the Code. We, therefore, find no equitable assignment for expenses arising from this provision of the agreement.\nWe, therefore, affirm that part of the order of the circuit court finding an equitable attorney lien for $4,014 in fees and awarding that amount to petitioners. We reverse the circuit court\u2019s finding of a lien for costs in the amount of $1,986.\nAffirmed in part; reversed in part.\nNASH and WOODWARD, JJ., concur.", "type": "majority", "author": "JUSTICE REINHARD" } ], "attorneys": [ "Kemp & Capanna, of Oak Brook (Anthony J. Nasharr III, of counsel), for appellant.", "Leonard M. Ring, of Leonard M. Ring & Associates, of Chicago (William J. Jovan, of counsel), for appellees." ], "corrections": "", "head_matter": "RONALD ACHS, Plaintiff-Appellant and Cross-Appellee, v. CHARLES MADDOX, Defendant (Peter Thomas Smith et al., Petitioners-Appellees and Cross-Appellants).\nSecond District\nNo. 2\u201488\u20140105\nOpinion filed November 3, 1988.\nRehearing denied December 8, 1988.\nKemp & Capanna, of Oak Brook (Anthony J. Nasharr III, of counsel), for appellant.\nLeonard M. Ring, of Leonard M. Ring & Associates, of Chicago (William J. Jovan, of counsel), for appellees." }, "file_name": "0989-01", "first_page_order": 1011, "last_page_order": 1018 }