Opinion ID: 3152589
Heading Depth: 2
Heading Rank: 3

Heading: Improper Bases

Text: The judge relied on additional factors outside the appro- priate scope of its inquiry. To the extent the judge’s umbrage at the firm’s pain-and-suffering comment undergirded the decision, we find that basis neither logically nor legally compelling. And the judge’s generalized reliance on “fair- ness and right reason” appears to be a rhetorical flourish. More problematic, though, is the judge’s apparent as- sumption that the retainer agreement was essentially a contract of adhesion. The judge recognized that “under ordinary circumstances … the sanctity of contracts calls for approval of [the] outcome.” But this case was not out of the ordinary; as we’ve explained, the fee structure was not unreasonable, and nothing suggests that the minor’s recovery was inadequate. Rather, the judge was disquieted by “the inherent inequality of bargaining power as between lawyer and client in the initial discussion in which fees are agreed upon.” This overlooks the reality that contingent-fee contracts play a vital role in our legal system. Declining to enforce these arrangements because they are “inherent[ly]” unequal would uproot the contingent-fee mechanism with disastrous No. 13-2434 15 consequences for those unable to pay lawyers upfront. And even if attorney-client bargaining may be unconscionable under certain circumstances, there is no indication that the Goesels felt that they could not negotiate the terms of their contract with the law firm or shop their case to other firms in search of a better deal. Finally, to the extent that the judge classified the retainer agreement as a contract of adhesion and on that basis declined to enforce it, this reasoning was unsound. The Illinois Supreme Court has recognized that “contract[s] of adhesion,” whose “terms … are nonnegotiable and presented in fine print in language that the average consumer might not fully understand, … are a fact of modern life.” Kinkel v. Cingular Wireless LLC, 857 N.E.2d 250, 266 (Ill. 2006). Nothing suggests that the retainer agreement even fits this description. Moreover, the fact that an agreement is a contract of adhesion does not automatically defeat enforceability. Phoenix Ins. Co. v. Rosen, 949 N.E.2d 639, 654 (Ill. 2011) (“[E]ven if we accept … that [an] … agreement is a contract of adhesion, such a finding does not render the agreement unenforceable.”). Rather, Illinois courts have required “[s]ome added coercion or overreaching” before they will hold a contract of adhesion unenforceable. Tortoriello v. Gerald Nissan of N. Aurora, Inc., 882 N.E.2d 157, 175 (Ill. App. Ct. 2008); see also Abbott v. Amoco Oil Co., 619 N.E.2d 789, 795 (Ill. App. Ct. 1993) (“[U]nfair advantage is the key to differentiating between the types of adhesion contracts … .”). There’s no indication here that the retainer agreement was the product of such gross inequity that it qualifies as procedurally unconscionable, which is the standard for non-enforcement 16 No. 13-2434 under Illinois law. 2 See Razor v. Hyundai Motor Am., 854 N.E.2d 607, 622 (Ill. 2006) (“Procedural unconscionability refers to a situation where a term is so difficult to find, read, or understand that the plaintiff cannot fairly be said to have been aware he was agreeing to it, and also takes into account a lack of bargaining power.”). Aside from unconscionability, a contract’s adhesive nature is relevant only in construing its ambiguous terms. Abbott, 619 N.E.2d at 798. Clauses susceptible of more than one meaning, particularly those that may prove “onerous” to one of the parties, should be “construed against the party with superior bargaining power.” Methodist Med. Ctr. of Ill. v. Taylor, 489 N.E.2d 351, 356 (Ill. App. Ct. 1986). But the record is bereft of any suggestion that this retainer agreement was ambiguous or that the Goesels were hoodwinked into a compensation arrangement that was unclear on its face. The judge’s concern that the firm had drawn up a contract of adhesion was unwarranted. The core problem with the judge’s ruling in this case is that it rests on nothing more than a series of unwarranted criticisms. Had the judge expressed all the same concerns over adhesive contracts and the lawyers’ subjective views while still rooting his decision in some genuinely unreasonable or objectionable aspect of the agreement, the deferential 2The judge appeared more concerned with substantive unconscionability, which “refers to those terms which are inordinately one-sided in one party’s favor.” Razor v. Hyundai Motor Am., 854 N.E.2d 607, 622 (Ill. 2006). But the substantive inquiry is directed to the operation of the contract, not the process by which it was negotiated and entered; whether an agreement is an adhesion contract is immaterial to the question of substantive unconscionability. No. 13-2434 17 standard of review would require us to affirm on the legitimate ground alone. What we’re left with, however, is the judge’s invocation of “fairness and right reason,” and that incantation cannot support an exercise of discretion where no argument for unfairness or wrong reason survives. The district court abused its discretion not by relying on several bad reasons but by relying on no good one.