Case Title: Morris B. Chapman & Associates, LTD., v. Kitzman

Citation: 

Docket Number: 88393

State: illinois

Court: Illinois Supreme Court

Date: 2000-11-16T00:00:00Z

Document:
Docket No. 88393-Agenda 24-May 2000.
MORRIS B. CHAPMAN & ASSOCIATES, LTD., Appellee, v. 								JOHN KITZMAN et al., Appellants.
Opinion filed November 16, 2000.
	JUSTICE BILANDIC delivered the opinion of the court:
	This action for attorney fees was filed in the circuit court of
Madison County.
BACKGROUND
	Johnny Kitzman died in an excavation-related accident in
Missouri. His widow, Karen, hired the law firm of Morris B.
Chapman & Associates to pursue legal recourse. Karen agreed to
pay Chapman one-third of any recovery as attorney fees. Chapman
filed a wrongful death action in Missouri. According to Missouri
law, decedent's heirs included his widow and his parents.
	Chapman obtained an $800,000 settlement for the benefit of
decedent's heirs after working on the case for three years.
Chapman filed a petition in the Missouri circuit court for
settlement approval and apportionment. Shortly before the hearing
on the petition, decedent's parents, John and Edna Kitzman,
retained separate counsel, John A. Kilo. The Kitzmans agreed to
pay Kilo one-third of any recovery in excess of $100,000 as
attorney fees. They intervened in the cause and participated in the
settlement approval and apportionment hearing.
	The Missouri court approved the settlement and entered an
order distributing 86% ($688,000) to Karen and 14% ($112,000)
to the Kitzmans. The court awarded Chapman a fee consisting of
one-third of Karen's share ($227,040), but no part of the
Kitzmans' share. The court awarded Kilo a fee consisting of one-third of the Kitzmans' share over $100,000 ($4,000).
	The Missouri court based its attorney fee awards on a
statutory provision that required the circuit court to order the
claimant:
			"To deduct and pay the expenses of recovery and
collection of the judgment and the attorneys' fees as
contracted, or if there is no contract, or if the party sharing
in the proceeds has no attorney representing him before
the rendition of any judgment or settlement, then the court
may award the attorney who represents the original
plaintiff such fee for his services, from such persons
sharing in the proceeds, as the court deems fair and
equitable under the circumstances." Mo. Rev. Stat.
§537.095(4)(2) (1986).
Given that Karen and the Kitzmans hired separate counsel for the
hearing, the court interpreted this language as requiring it to award
attorney fees pursuant to the existing contracts. The court therefore
awarded no attorney fees out of the first $100,000 of the
Kitzmans' share. The court acknowledged that it "seems unfair to
permit potential wrongful death plaintiffs to rest on their oars until
a settlement of a claim is achieved, and then appear with counsel
so as to prevent the original plaintiff's fees from being a shared
burden." Nonetheless, the court held, the statutory language
requires this result. No appeal was taken.
	One month later, Chapman filed the instant action against the
Kitzmans in Illinois, requesting an award of reasonable attorney
fees. Chapman's first amended complaint sought fees based on
quantum meruit and the common fund doctrine.
	The Kitzmans filed three separate motions to dismiss. They
alleged that Chapman's claim is barred by the full faith and credit
clause of the United States Constitution (U.S. Const., art. IV, §1)
as res judicata. They further alleged that the complaint fails to
state a cause of action under Missouri law and, alternatively, under
Illinois law. Lastly, the Kitzmans moved for sanctions against
Chapman pursuant to Supreme Court Rule 137 (155 Ill. 2d R.
137). The pleadings disclosed that Chapman is an Illinois
corporation with a law office in Illinois, and that the Kitzmans are
Illinois residents.
	The circuit court ruled that Chapman's action is not barred.
The court, however, dismissed the quantum meruit count after
Chapman verbally agreed to its dismissal. The court dismissed the
common fund doctrine count, holding that the doctrine is not
applicable in this case. Lastly, the court denied the Kitzmans'
motion for sanctions.
	The appellate court affirmed in part and reversed in part, and
remanded the cause for further proceedings. 307 Ill. App. 3d 92.
Applying Missouri law, the court agreed that Chapman's action is
not barred as res judicata. The court thus agreed that Chapman's
action is not barred by the full faith and credit clause. The court
nonetheless reversed the dismissal of the common fund doctrine
count. After conducting a conflict-of-laws analysis, the court
applied Illinois substantive law with respect to the common fund
doctrine and held that count II of Chapman's complaint survives
the Kitzmans' motions to dismiss. The court affirmed the denial
of sanctions.
	The Kitzmans' initial petition for leave to appeal was returned
to them because it violated the page limitation set forth in
Supreme Court Rule 315(c) (177 Ill. 2d R. 315(c)). After this
violation was remedied, this court granted the Kitzmans leave to
file their petition for leave to appeal instanter. See 177 Ill. 2d R.
315(b). We subsequently allowed the Kitzmans' petition for leave
to appeal as a matter of right. 134 Ill. 2d R. 317; see Schoeberlein
v. Purdue University, 129 Ill. 2d 372, 376 (1989). This court has
jurisdiction over the cause.
ANALYSIS
I
	The Kitzmans contend that the full faith and credit clause bars
this action because the Missouri court's fee apportionment order
is res judicata as to Chapman's claim. For this reason, they argue,
the circuit court should have dismissed Chapman's complaint.
	As an initial matter, we generally apply the law of the forum,
i.e., Illinois law, with regard to matters of pleading and how the
litigation shall be conducted. See Nelson v. Hix, 122 Ill. 2d 343,
346-47 (1988); Restatement (Second) of Conflict of Laws §§122,
127 (1971); see generally 16 Am. Jur. 2d Conflict of Laws §§153,
163 (1998) (noting that, in matters of pleading and how litigation
is conducted, the law of the forum state governs). In Illinois,
section 2-619(a)(4) of the Code of Civil Procedure permits the
involuntary dismissal of an action where it is "barred by a prior
judgment." 735 ILCS 5/2-619(a)(4) (West 1996). This provision
allows a party to raise the affirmative defense of res judicata.
Where, as here, there is no issue of material fact, an appellate court
conducts de novo review and determines whether dismissal by
reason of res judicata is proper as a matter of law. See Epstein v.
Chicago Board of Education, 178 Ill. 2d 370, 383 (1997);
Torcasso v. Standard Outdoor Sales, Inc., 157 Ill. 2d 484, 486,
491 (1993).
	According to the United States Constitution, "Full Faith and
Credit shall be given in each State to the public Acts, Records, and
judicial Proceedings of every other State." U.S. Const., art. IV, §1.
This clause requires Illinois courts to give the judgment of a sister
state at least the res judicata effect that the sister state rendering
the judgment would give to it. Durfee v. Duke, 375 U.S. 106, 109,
11 L. Ed. 2d 186, 190, 84 S. Ct. 242, 244 (1963); Hays v.
Louisiana Dock Co., 117 Ill. App. 3d 512, 517 (1983); see
Underwriters National Assurance Co. v. North Carolina Life &
Accident & Health Insurance Guaranty Ass'n, 455 U.S. 691, 71 L. Ed. 2d 558, 102 S. Ct. 1357 (1982). Hence, we must apply
Missouri law to determine whether Chapman's claim against the
Kitzmans is barred as res judicata by the Missouri court judgment.
	Pursuant to Missouri law, the following "four identities" must
appear for res judicata to adhere: (1) identity of the thing sued for;
(2) identity of the cause of action; (3) identity of the persons and
parties to the action; and (4) identity of the quality of the person
for or against whom the claim is made. King General Contractors,
Inc. v. Reorganized Church of Jesus Christ of Latter Day Saints,
821 S.W.2d 495, 501 (Mo. 1991) (en banc). The third identity,
that of the parties to the action, is dispositive here.
	Chapman was not a party to the wrongful death action.
Rather, Chapman was the law firm representing a party. As the
Missouri Court of Appeals explained in an attorney fee dispute
arising out of a wrongful death action,
			"[T]he attorneys were not parties to the underlying
litigation. Res judicata bars only claims by parties and
privies. *** The concept of privity for purposes of res
judicata connotes interests so closely related that the party
sought to be barred may be said to have had a day in
court. The interest of an attorney with regard to a fee
claim is not of this character." Floyd v. Shaw, 830 S.W.2d 564, 565 (Mo. App. 1992).
Accordingly, applying Missouri law, we conclude that res judicata
is not a bar to Chapman's claim for fees.
	On a related note, the Kitzmans next suggest that Chapman is
collaterally estopped from pursuing its claim for attorney fees.
Collateral estoppel is also known as issue preclusion. To
determine whether issue preclusion obtains, Missouri courts apply
a somewhat different test than the one set forth above. King
General Contractors, Inc., 821 S.W.2d  at 500-01. Nevertheless,
issue preclusion is never applied against a party who could not
appeal from the earlier judgment as a matter of law. Restatement
(Second) of Judgments §28(1), at 273; Comment a, at 274 (1982);
see King General Contractors, Inc., 821 S.W.2d  at 501-02
(following Restatement (Second) of Judgments); see generally K.
Moore, Collateral Attack on Subject Matter Jurisdiction: A
Critique of the Restatement (Second) of Judgments, 66 Cornell L.
Rev. 534, 560 & n.125 (1981) (discussing the importance of this
exception). The question thus arises whether Chapman could have
appealed from the Missouri court judgment.
	In Missouri, appellate review of an order distributing a
wrongful death settlement must be sought pursuant to section
512.020 of the Missouri Code of Civil Procedure (Mo. Rev. Stat.
§512.020 (1993)). Section 512.020 limits the right to an appeal
only to parties to the suit, which does not include a party's law
firm. In a similar context, the Missouri Court of Appeals
explained:
			"The right to appeal is purely statutory. [Citations.]
Section 512.020 provides that any 'party to a suit
aggrieved by any judgment of any trial court in any civil
case ... may take his appeal to a court having appellate
jurisdiction.' By its express terms, the statute limits
appeals; only a 'party to a suit' may appeal. The [law]
firm was not a party. Therefore, the [law] firm has no
statutory right to appeal." Oberhellmann v.
Oberhellmann, 950 S.W.2d 487, 488 (Mo. App. 1997).
Because the Chapman law firm was not a party to the wrongful
death suit, it was not allowed to appeal from the Missouri court
judgment. Issue preclusion, therefore, does not apply.
	In summary, there is no bar to Chapman's action against the
Kitzmans for attorney fees.
II
	The Kitzmans next argue that Chapman's complaint should
be dismissed because it fails to state a cause of action pursuant to
the common fund doctrine. According to the Kitzmans, the
common fund doctrine cannot be used to obtain attorney fees in a
wrongful death action. The Kitzmans contend that we should
apply the substantive law of Missouri in resolving this issue.
Chapman counters that the substantive law of Illinois applies. If
Illinois substantive law applies, the Kitzmans maintain,
Chapman's complaint still fails for legal insufficiency.
	Before proceeding, we note that the law of the forum state
governs matters of pleading, including the rules of pleading and
sufficiency. See Nelson, 122 Ill. 2d at 346-47; Restatement
(Second) of Conflict of Laws §§122, 127 (1971); see generally 16
Am. Jur. 2d Conflict of Laws §163, at 171 (1998) (explaining
rule). In Illinois, the standard of review on appeal from a motion
to dismiss pursuant to section 2-615 of the Code of Civil
Procedure (735 ILCS 5/2-615 (West 1996)) is whether the
complaint alleges sufficient facts which, if proved, would entitle
the plaintiff to relief. Charles v. Seigfried, 165 Ill. 2d 482, 485-86
(1995). Our review is de novo.
	A conflict exists on this issue between the substantive law of
Missouri and Illinois. If Missouri law applies, Chapman's
common-fund-doctrine claim fails as a matter of law. This is
because a Missouri statute precludes the use of the common fund
doctrine to obtain attorney fees in a wrongful death action where,
as here, all the attorneys had existing fee contracts with their
clients. Keene v. Wilson Refuse, Inc., 788 S.W.2d 324, 327 (Mo.
App. 1990) (interpreting the same statutory provision at issue
here). If, on the other hand, Illinois law applies, Chapman's
complaint survives the dismissal motion because, as later
explained, it sufficiently states a cause of action pursuant to the
common fund doctrine. We must therefore decide whether the
substantive law of Missouri or Illinois governs this case.
	In deciding whose substantive law to apply, we look to our
own choice-of-law rules. Esser v. McIntyre, 169 Ill. 2d 292, 297
(1996). Ordinarily, Illinois follows the Restatement (Second) of
Conflict of Laws (1971) in making choice-of-law decisions.
Section 6 of that Restatement sets forth several general factors that
courts consider in doing so, the following of which are relevant
here: "the basic policies underlying the particular field of law";
"the relevant policies of other interested states and the relative
interests of those states in the determination of the particular
issue"; and "the relevant policies of the forum." Restatement
(Second) of Conflict of Laws §6(2), at 10 (1971); see Esser, 169 Ill. 2d  at 299  n.1 (utilizing relevant principles in section 6(2));
Nelson, 122 Ill. 2d  at 350-51 (same).
	Consideration of the general factors of section 6 supports the
application of Illinois law. We first assess the basic policies
underlying the particular field of law. The basic policy underlying
the common fund doctrine is the prevention of unjust enrichment.
See Scholtens v. Schneider, 173 Ill. 2d 375, 385 (1996); Jesser v.
Mayfair Hotel, Inc., 360 S.W.2d 652, 661 (Mo. 1962). As this
court stated, "The underlying justification for reimbursing
attorneys from a common fund, as explained by the United States
Supreme Court in three early cases, is that, unless the costs of
litigation are spread to the beneficiaries of the fund, they will be
unjustly enriched by the attorney's efforts. [Citations.]" Scholtens,
173 Ill. 2d  at 385. This underlying policy against unjust
enrichment can be fulfilled in this case only by an application of
Illinois law. Thus, this factor favors application of Illinois law.
	We next consider the relevant policies of Missouri and the
relative interests of Missouri in the determination of this particular
issue. The public policy of a state may be sought in its
constitution, legislative enactments and judicial decisions. See
Roanoke Agency, Inc. v. Edgar, 101 Ill. 2d 315, 327 (1984). The
Missouri legislature has prescribed by statute how attorney fees are
to be awarded, as earlier quoted. On the one hand, the Missouri
statute promotes equitable fee awards. Where a party sharing in a
judgment or settlement is not represented by counsel, it affords the
trial court the discretion to award the attorney who secured the
proceeds a fair and equitable fee from that party's share. On the
other hand, the statute promotes inequitable fee apportionment and
unjust enrichment in certain circumstances. Where a party sharing
in the proceeds hires counsel only after a different attorney has
already secured the proceeds, the statute removes the court's
discretion to award fees by requiring the court to award fees "as
contracted." Thus, the statute operates unjustly to reward a party
for doing nothing until a judgment or settlement is achieved, and
then hiring counsel. The late hiring of counsel relieves the party
from paying any portion of the fees of the original attorney, even
though that attorney secured the proceeds benefitting the party.
	The present case exemplifies the injustice inherent in the
Missouri statute. Chapman alone pursued this case for longer than
three years before securing an $800,000 settlement for the benefit
of all the heirs, including the Kitzmans. Yet the Missouri statute
required the Kitzmans to pay Chapman nothing because, after
Chapman secured the settlement, the Kitzmans entered into a
written contract with separate counsel to represent them at the
apportionment phase. Given the conflicting results that may obtain
under the Missouri statute, we are not able to discern what the
relevant policies and interests of Missouri are with respect to this
particular issue. The Missouri circuit court that denied Chapman
fees expressly noted the unfairness inherent in the statute's
operation under these facts. This factor thus disfavors the
application of Missouri law.
	The relevant policies of the forum must be considered as well.
The public policy of Illinois may be sought in our judicial
decisions and legislative enactments, as well as our constitution.
See Roanoke Agency, Inc., 101 Ill. 2d  at 327. Decisions of this
court express a public policy against unjust enrichment in this
context. See Scholtens, 173 Ill. 2d  at 385; Brundidge v. Glendale
Federal Bank, F.S.B., 168 Ill. 2d 235, 238 (1995). As to legislative
enactments, the parties have not cited and our research has not
disclosed any Illinois statute that precludes application of the
common fund doctrine under these facts. Therefore, the public
policy of Illinois favors the application of Illinois law.
	In addition to the broad general factors of section 6, the
Second Restatement of Conflict of Laws contains guidance for
more specific problems of determining which forum's law to
apply. Section 221 is applied to the narrow class of claims of
restitution and unjust enrichment. Restatement (Second) of
Conflict of Laws §221, Comment a, at 728 (1971). Because the
common fund doctrine arises out of the equitable theory of unjust
enrichment (see Scholtens, 173 Ill. 2d  at 385; Jesser, 360 S.W.2d
at 661), we also look to that section in resolving which forum's
law to apply in the present case. Section 221 provides:
			"(1) In actions for restitution, the rights and liabilities
of the parties with respect to the particular issue are
determined by the local law of the state which, with
respect to that issue, has the most significant relationship
to the occurrence and the parties under the principles
stated in §6.
			(2) Contacts to be taken into account in applying the
principles of §6 to determine the law applicable to an
issue include:
				(a) the place where a relationship between the parties
was centered, provided that the receipt of enrichment
was substantially related to the relationship,
				(b) the place where the benefit or enrichment was
received,
				(c) the place where the act conferring the benefit or
enrichment was done,
				(d) the domicil, residence, nationality, place of
incorporation and place of business of the parties, and
				(e) the place where a physical thing, such as land or
a chattel, which was substantially related to the
enrichment, was situated at the time of the enrichment.
			These contacts are to be evaluated according to their
relative importance with respect to the particular issue."
Restatement (Second) of Conflict of Laws §221, at 727
(1971).
	Here, consideration of section 221 supports the application of
Illinois substantive law to this dispute. We find it significant that
Chapman is an Illinois corporation with its law office in Illinois,
and that the Kitzmans are Illinois residents. Furthermore, Illinois
is the place where the relationship between the parties is centered
with regard to the pertinent issue of attorney fees. There also is no
dispute that Chapman performed many of its legal services in
Illinois, which conferred enrichment on the Kitzmans. Illinois,
therefore, has the most significant relationship to the parties and
the issue at bar. We acknowledge that Missouri is the place where
the Kitzmans' enrichment was ultimately received, given that the
underlying lawsuit was filed and concluded in a Missouri court.
We further acknowledge that Chapman performed some of its
legal services in Missouri, which conferred enrichment on the
Kitzmans. These latter points, however, do not outweigh the
significant factors favoring the application of Illinois law.
	In conclusion, the factors of both section 6 and section 221
support the application of Illinois law. We thus apply the
substantive law of Illinois regarding the common fund doctrine.
	Illinois generally follows the "American Rule": absent
statutory authority or a contractual agreement between the parties,
each party to litigation must bear its own attorney fees and costs,
and may not recover those fees and costs from an adversary.
Scholtens v. Schneider, 173 Ill. 2d 375, 384 (1996); Saltiel v.
Olsen, 85 Ill. 2d 484, 488-89 (1981).
	The common fund doctrine does not authorize a party to shift
fees to an adversary, but rather authorizes the spread of fees
among those who benefitted from the litigation. The doctrine
permits a party who creates, preserves, or increases the value of a
fund in which others have an ownership interest to be reimbursed
from that fund for litigation expenses incurred, including counsel
fees. Scholtens, 173 Ill. 2d  at 385. The litigant or lawyer who
recovers a common fund for the benefit of others is entitled to a
reasonable attorney fee from the fund as a whole. Scholtens, 173 Ill. 2d  at 385, quoting Boeing Co. v. Van Gemert, 444 U.S. 472,
478, 62 L. Ed. 2d 676, 681, 100 S. Ct. 745, 749 (1980). If the costs
of litigation are not spread to the beneficiaries of the fund, they
will be unjustly enriched by the attorney's efforts. Scholtens, 173 Ill. 2d  at 385.
	The Kitzmans argue that, under Illinois law, the common fund
doctrine cannot be applied to this case for three reasons. First, they
claim that Illinois courts have limited application of the doctrine
to only class actions and insurance subrogation cases.
	We reject this contention. We consider it well established that
the common fund doctrine "has been applied in many types of
cases covering a large range of civil litigation," not just to class
actions and insurance subrogation cases. Scholtens, 173 Ill. 2d  at
388 (and authorities cited therein); R. Rossi, Attorneys' Fees
§§6.10 through 6.21 (2d ed. 1995 & Supp. 2000) (discussing many
types of cases in which doctrine has been applied). Whether the
doctrine applies in a particular case is not determined by a label,
but rather by a proper understanding of the doctrine and its
limitations. See generally R. Rossi, Attorneys' Fees §§6.1 to 6.9
(2d ed. 1995 & Supp. 2000) (explaining doctrine and its
limitations).
	In support of their position, the Kitzmans quote from a federal
appeals court decision, which states that Illinois case law "has
restricted the application of the fund doctrine to class actions and
insurance subrogation cases." McKee-Berger-Mansueto, Inc. v.
Board of Education of the City of Chicago, 691 F.2d 828, 835 (7th
Cir. 1982); see also Insurance Co. of North America v. Norton,
716 F.2d 1112, 1117 (7th Cir. 1983). We disagree with this
characterization of Illinois law. The only case cited by the federal
court to support this statement was Maynard v. Parker, 54 Ill.
App. 3d 141 (1977), aff'd, 75 Ill. 2d 73 (1979). A reading of this
court's decision in Maynard, however, reveals the complete
absence of any suggestion that the common fund doctrine is
limited to only "class actions" and "insurance subrogation cases."
See Maynard, 75 Ill. 2d 73. In fact, those phrases never appear in
the opinion. Maynard simply held that the common fund doctrine
did not apply against a hospital where the attorney seeking fees
represented a patient who was indebted to the hospital for medical
services, and a statute both provided for and limited the amount of
that hospital's lien. Maynard, 75 Ill. 2d 73. In those circumstances,
the hospital was not unjustly enriched by the attorney's services.
Moreover, the appellate court in Maynard did not hold that the
doctrine is limited to only class actions and insurance subrogation
cases. See Maynard, 54 Ill. App. 3d 141, aff'd, 75 Ill. 2d 73.
	Second, the Kitzmans submit that the common fund doctrine
cannot be utilized outside of the subrogation context unless the
court has a full, segregated fund under its control. They correctly
note that there is a conflict in our appellate court as to whether this
requirement exists. The Fifth District of the appellate court in this
case rejected the requirement, whereas the First District has
embraced it (Wolff v. Ampacet Corp., 284 Ill. App. 3d 824, 828-29
(1st Dist. 1996); City of Chicago v. Korshak, 276 Ill. App. 3d 597,
602-03 (1st Dist. 1995)).
	The Supreme Court of the United States rejected a similar
requirement in a leading case applying the common fund doctrine,
Sprague v. Ticonic National Bank, 307 U.S. 161, 83 L. Ed. 1184,
59 S. Ct. 777 (1939). The plaintiff in Sprague did not bring a fund
into court in which others could participate. The fund, however,
existed and was identifiable. It consisted of earmarked bonds in
the trust department of a bank in receivership under the protection
of a federal court. The Court held:
		"Whether one *** formally makes a fund available for
others may, of course, be a relevant circumstance in
making the fund liable for his costs in producing it. But
when such a fund is for all practical purposes created for
the benefit of others, *** the absence of *** the creation
of a fund *** hardly touch[es] the power of equity in
doing justice as between a party and the beneficiaries of
his litigation." Sprague, 307 U.S.  at 167, 83 L. Ed.  at
1187, 59 S. Ct.  at 780.
	Following Sprague, the United States Court of Appeals for
the Fifth Circuit also declined to require that a segregated fund be
under court control before the common fund doctrine may be
applied. In re Air Crash Disaster at Florida Everglades on
December 29, 1972, 549 F.2d 1006, 1018 (5th Cir. 1977). The
court explained: "In the present case there is not a fund in the
sense of identified items already in the hands of a court appointee,
but this is not a necessity. Determination of whether a fund exists
is a combination of traditional and pragmatic concepts centering
around the power of the court to control the alleged fund." In re
Air Crash Disaster at Florida Everglades on December 29, 1972,
549 F.2d  at 1018. Thus, after concluding that a fund did exist as a
practical matter, the court held that attorney fees could be awarded
pursuant to the common fund doctrine. In re Air Crash Disaster
at Florida Everglades on December 29, 1972, 549 F.2d  at 1018-21.
	As noted, the First District of the appellate court has held that
the common fund doctrine can never be applied outside the
subrogation context unless the court has a full, segregated fund
under its control. Wolff, 284 Ill. App. 3d at 828-29; Korshak, 276
Ill. App. 3d at 603. We reject this view. The existence of a full,
segregated fund within the court's control is not a universal
prerequisite to application of the common fund doctrine. See
Taylor v. State Universities Retirement System, 203 Ill. App. 3d
513, 520-21 (1990). Rather, as explained by the decisions
discussed above, the doctrine may be applied where a fund, for all
practical purposes, has been created for the benefit of others.
	The First District based its holding on three decisions of this
court, as well as some appellate cases interpreting those decisions.
As we discuss below, however, no decision of this court has
placed such a restriction on application of the common fund
doctrine. Those decisions are distinguishable as falling outside the
scope of the common fund doctrine.
	In Hamer v. Kirk, 64 Ill. 2d 434 (1976), the petitioner sued
several governmental entities on behalf of a class of taxpayers.
The petitioner obtained partial relief in that the Lake County board
of review was ordered to equalize the level of assessment of
property for each township in the county. The petitioner then
requested that the court enter an order against the defendants for
attorney fees and expenses. This court held that attorney fees could
not be awarded under the common fund doctrine because "no such
funds exist." Hamer, 64 Ill. 2d  at 440.
	To elaborate, in Hamer there simply was no fund, either in
court control or as a practical matter. The petitioner did not obtain
any existing or identifiable monetary award for the class. The lack
of a fund is further evidenced by the fact that the petitioner was
seeking to collect attorney fees from his adversary, not from the
beneficiaries of the attorney's work. Hamer, 64 Ill. 2d  at 436; see
Saltiel, 85 Ill. 2d  at 489 (explaining that attorney fees are not
charged against an adversary in fund cases); Ryan v. City of
Chicago, 274 Ill. App. 3d 913, 925 (1995) (same).
	In Hoffman v. Lehnhausen, 48 Ill. 2d 323 (1971), a class of
taxpayers sued various governmental officials seeking to enjoin
the enforcement of a statute that granted a certain property tax
exemption to persons age 65 or older. The taxpayers obtained
relief in that the statute was declared unconstitutional and its
enforcement enjoined. The taxpayers then sought an award of
attorney fees. This court held that attorney fees could not be
awarded under the common fund doctrine because, among other
reasons, there was "[n]o fund." Hoffman, 48 Ill. 2d  at 329. Like in
Hamer, the taxpayers did not obtain any existing or identifiable
monetary award for the class. Their success, rather, was in
enjoining a statute as unconstitutional.
	In Rosemont Building Supply, Inc. v. Illinois Highway Trust
Authority, 51 Ill. 2d 126 (1972), the plaintiffs filed a suit against
the Illinois Highway Trust Authority and various governmental
officials on behalf of a class of taxpayers. The plaintiffs
successfully challenged as unconstitutional a statute that
empowered the Trust Authority to act. The plaintiffs then sought
an award of attorney fees from the defendants. This court held that
attorney fees could not be awarded under the common fund
doctrine because "no fund" was involved. Rosemont Building
Supply, 51 Ill. 2d  at 130. Again, the plaintiffs did not obtain any
existing or identifiable monetary award for the class. Their success
consisted in having a statute declared unconstitutional. The fact
that the plaintiffs were seeking to collect attorney fees from their
adversaries, not from the beneficiaries of the attorney's work, also
shows the inapplicability of the common fund doctrine. See
generally Rosemont Building Supply, 51 Ill. 2d  at 128; see also
Saltiel, 85 Ill. 2d  at 489; Ryan, 274 Ill. App. 3d at 925.
	Our review of Hamer, Hoffman and Rosemont Building
Supply persuades us that this court has never restricted application
of the common fund doctrine in the manner asserted by the
Kitzmans. The common fund doctrine was not applicable in those
cases, mainly because there was no fund.
	The present case, in contrast, falls squarely within the
doctrine. Chapman alone pursued this case for longer than three
years before securing an $800,000 settlement for the benefit of all
the heirs, including the Kitzmans. The Kitzmans were awarded
$112,000 as a result of Chapman's work. The settlement
constitutes a common fund, and the Kitzmans received a share of
that fund. The Kitzmans maintain that the doctrine cannot be
applied to them because the fund is not currently controlled by
Illinois courts. We disagree. We hold that the mere fact that the
fund is not within the actual control of the Illinois courts is not
determinative of Chapman's claim. 	The Kitzmans' third
contention is that the common fund doctrine can never be used to
obtain attorney fees in a wrongful death action. The Kitzmans do
not offer any argument or authority in support of this position, and
we are aware of none. Our research has not disclosed any Illinois
statute or case that precludes application of the common fund
doctrine to wrongful death cases. Accordingly, we reject this
contention.
	The Kitzmans raise no further challenge to the application of
the common fund doctrine in this case. Therefore, we affirm the
holding of the appellate court that Chapman's complaint
sufficiently states a cause of action pursuant to the doctrine.
III
	The Kitzmans last assert that the circuit court erred in denying
their motion for sanctions, filed pursuant to Supreme Court Rule
137 (155 Ill. 2d R. 137). They maintain that Chapman should be
sanctioned for pursuing a claim that was barred by the full faith
and credit clause and the doctrine of res judicata. According to the
Kitzmans, Chapman has provided no good-faith argument that its
claim is not barred.
	Rule 137 authorizes sanctions against an attorney for pursuing
false or frivolous lawsuits. See Cult Awareness Network v. Church
of Scientology International, 177 Ill. 2d 267, 279 (1997). The
decision whether to impose sanctions under Rule 137 is committed
to the sound discretion of the circuit court, and that decision will
not be reversed on appeal absent an abuse of discretion. Dowd &
Dowd, Ltd. v. Gleason, 181 Ill. 2d 460, 487 (1998).
	Chapman has prevailed in its argument that no bar exists to its
claim. Given Chapman's success on the merits of this issue, its
position cannot be deemed frivolous. Thus, the circuit court's
refusal to impose sanctions is not an abuse of discretion.
	As a final matter, taken with the case was the Kitzmans'
motion to recall the mandate of the appellate court, which was
issued on October 20, 1999. We hereby allow this motion. See 155
Ill. 2d R. 368(c).
CONCLUSION
	For the reasons stated, the judgment of the appellate court is
affirmed.
Affirmed.
	CHIEF JUSTICE HARRISON took no part in the
consideration or decision of this case.
	JUSTICE RATHJE, dissenting:
	I agree with the majority's analysis and conclusion in parts I
and III. I disagree, however, with the majority's analysis in part II.
Accordingly, I respectfully dissent.
	The majority cites to section 6 of the Restatement (Second) of
Conflict of Laws and identifies three factors that are relevant to the
conflict of laws issue. Slip op. at 7. One relevant factor is ignored
by the majority-"the protection of justified expectations."
Restatement (Second) of Conflict of Laws §6(2)(d), at 10 (1971).
The balancing of this factor along with the three mentioned by the
majority requires this court to apply Missouri's substantive law on
the issue of the distribution of attorney fees.
	The first factor addressed by the majority is " 'the basic
policies underlying the particular field of law.' " Slip op. at 7,
quoting Restatement (Second) of Conflicts of Law §6(2)(e), at 10
(1971). The majority begins by discussing the policy behind the
common fund doctrine and then states that, because Illinois uses
the common fund doctrine in wrongful death cases and Missouri
does not, Illinois law should apply. In other words, the majority
designates the Illinois common fund doctrine as the "particular
field of law" and concludes that the policies underlying the Illinois
law more clearly fulfill the policies of the "particular field of law."
The majority's circular logic mischaracterizes the issue. The
appropriate question under this factor is which state's law better
serves the policies underlying the distribution of attorney fees. 
This question is a much closer one than the majority claims. On
one hand, as the majority correctly points out, the Illinois common
fund doctrine prevents attorneys who did not participate as fully in
the litigation from being unjustly enriched in the dispensation of
attorney fees. Slip op. at 7. On the other hand, as the majority fails
to point out, under Missouri law, each litigant has the freedom to
choose which attorney collects the fees associated with the
litigant's claim. Both states' laws demonstrate clear policies that
relate to the basic policies of attorney fee distribution-fairness and
client choice of attorney.  
	Second, the majority addresses " 'the relevant policies of
other interested states and the relative interests of those states in
the determination of the particular issue.' " Slip op. at 7, quoting
Restatement (Second) of Conflict of Laws §6(2), at 10 (1971).
Again assuming that the particular field of law is the common
fund doctrine, the majority argues that the statute creates unjust
results and that therefore the factor "disfavors the application of
Missouri law." Slip op. at 8. The majority fails to even discuss the
relevant interests of Missouri in the discussion of this factor.
Missouri has a substantial interest in this case. The cause of action
arose in Missouri, and some of the most relevant work on the
action was done there. In fact, Chapman would not even have a
separate cause of action for the disbursement of attorney fees if
this case had not been filed in Missouri. See slip op. at 5-6. As
discussed above, Missouri also has a clear policy which, while
different than the Illinois policy, does not offend it. This factor
weighs in favor of Missouri.
	The third factor addressed is the " 'relevant policies of the
forum.' " Slip op. at 8, quoting Restatement (Second) of Conflict
of Laws §6(2)(b), at 10 (1971). This factor is discussed throughout
this section of the majority opinion. The majority is correct that
Illinois law would apply the common fund doctrine and that the
policy underlying that law is against unjust enrichment. This does
not mean, however, that a state that does not apply the common
fund doctrine has a policy for unjust enrichment. Rather, the
Missouri legislators have determined that the policy of attorney
choice is more important to their state than the policy against
unjust enrichment. Illinois has an obvious policy against unjust
enrichment, and, although the Missouri policy does not offend the
Illinois policy, the Missouri law clearly does. Therefore, this factor
weighs in favor of Illinois. 
	A fourth factor that the majority does not consider is " 'the
protection of justified expectations.' " Restatement (Second) of
Conflict of Laws §6(2)(d), at 10 (1971). This factor is explained
in the comments to the Restatement (Second) as follows:
			"This is an important value in all fields of law,
including choice of law. Generally speaking, it would be
unfair and improper to hold a person liable under the local
law of one state when he had justifiably molded his
conduct to conform to the requirements of another state."
Restatement (Second) of Conflict of Laws §6(2)(g),
Comments, at 15 (1971). 
	In this case, the underlying action arose in Missouri, and, most
importantly, Chapman filed this action in Missouri. He is
presumed to know how attorney fees are disbursed in wrongful
death actions in Missouri. The attorney clearly should have
expected Missouri law to apply, as should all of the parties. The
only person who might have any claim to expect Illinois to govern
attorney fees is Karen, because her relationship with Chapman was
initiated in Illinois. Karen, however, is not a party to this action,
and the attorney fees for her portion of the settlement are not at
issue. The Kitzmans, by contrast, had no relationship with
Chapman until he filed the wrongful death action in Missouri. The
Kitzmans contracted with their attorney, who agreed to be paid
one-third of any recovery in excess of $100,000. This contract
clearly demonstrates that they expected Missouri law to apply, and
the fact that Chapman filed the lawsuit in Missouri renders their
expectation justified. Consequently, this factor overwhelmingly
favors the application of Missouri law.
	Under these four factors, Missouri law applies. As a result, the
common fund doctrine is not applicable. I would therefore reverse
the appellate court as to this issue.