In addition, Western States' subrogation claim was not a debt of the Irvins that could be discharged by the bankruptcy court. Moreover, as discussed above, the defendants' failure to return Western States' share of the settlement proceeds after the checks cleared amounted to a conversion of Western States' funds. This conversion occurred before the bankruptcy petition was filed and before the creditors meeting took place. The defendants have cited no authority to support the proposition that their liability to Western States was affected by Western States' failure to attend the creditors meeting or the discharge of the Irvins' debts by the bankruptcy court. While we recognize that the defendants could have mistakenly believed that they were required to turn over Western States' share of the settlement proceeds to the Irvins, this mistake does not relieve the defendants of their liability to Western States.
Attorneys are well-advised to proceed cautiously whenever a client files a bankruptcy petition.
However, an attorney is liable to a third party if he wrongfully releases that party's funds to his client. Accordingly, we hold that the defendants' liability to Western States was not vitiated by Western States' failure to attend the creditors meeting or by the discharge of the Irvins' debts by the bankruptcy court. Because we reverse the trial court's judgment and grant summary judgment in favor of Western States, we need not address the additional grounds for reversal raised by Western States. For the foregoing reasons, the judgment of the circuit court of La Salle County is reversed, and summary judgment is entered in favor of Western States.