Court Opinion

ID: 9542601
Source: CourtListenerOpinion
Date Created: 2023-08-07 16:36:21.243279+00
Date Added: 2024-06-11T15:08:23.693888
License: Public Domain

JUSTICE McNAMARA*, dissenting: I dissent from the majority holding that Hanover is entitled to indemnification for attorney fees and costs. Moreover, even if it were entitled to indemnification, I would not find, as the majority holds, that Hanover sufficiently proved the reasonableness of the fees or that Hanover should receive all fees requested. Rule 23 orders are not precedential, but the fact remains that on June 29, 1983, in a Rule 23 order (Hanover Insurance Co. v. Smith (1st Dist. 1983), No. 82 — 2016 (unpublished order under Supreme Court Rule 23)), we held .that the appeal bond here was void. We expressly refused to adopt the trial court’s construction of the void bond as a contract between Hanover and defendants. We rejected the trial court’s reasoning that the void bond became a binding obligation of Hanover as surety for the principals and that Hanover was obligated to pay the Smith judgment, plus interest, damages and costs. Instead, we adopted Hanover’s argument that it had no liability under the bond and held that “the trial court’s finding, that Hanover was liable to Smith and Gomberg notwithstanding that the appeal bond was null and void, must be reversed.” (No. 82 — 2016, Rule 23 order at 5.) We relied on the well-established principle that “the trial court was not empowered to rewrite the void bond or to substitute a different contract.” (No. 82 — 2016, Rule 23 order at 5, citing In re Estate of Savage (1979), 73 Ill. App. 3d 656, 392 N.E.2d 263; People ex rel. Illinois State Scholarship Comm’n v. Harrison (1978), 67 Ill. App. 3d 359, 384 N.E.2d 947.) Now Hanover returns, in the fourth appeal regarding this 1975 personal injury, and reverses its position by asking us to find an enforceable contract under which it retains the right to attorney fees. I find no reason to, in effect, alter the prior decision of this court. (See Police Jury v. United States Fidelity & Guaranty Co. (1930), 171 La. 244, 130 So. 344 (where defendant surety on bond successfully argued it was not liable on the bond, the purpose of the consideration for furnishing the indemnity fell, and with it the contract of indemnity, and therefore it would be improper to allow defendant’s demand for attorney fees under that contract).) The indemnity agreement purports to indemnify Hanover against attorney fees in connection with the bond, and thus the agreement assumes a bond exists. The bond having been found void, the indemnity agreement is stripped of meaning and effect. I would reverse the trial court order which found that, as a matter of law pursuant to the indemnity agreement, Hanover is entitled to indemnity of its attorney fees and costs from Fried. Furthermore, I would find that even if there was liability for the attorney fees, Hanover failed to present adequate evidence, e.g., of the novelty and complexity of the issues, the expertise of the attorney, the services rendered, and the resulting benefits of the attorneys’ efforts. (See Baker v. City of Granite City (1983), 112 Ill. App. 3d 1096, 446 N.E.2d 531.) Where an indemnitee is entitled to attorney fees and costs, the indemnitee is required to establish by competent evidence its reasonable fees and costs, since the indemnitor i£ not necessarily liable for the amount the indemnitee unilaterally chose to pay. (Lamp, Inc. v. International Fidelity Insurance Co. (1986), 143 Ill. App. 3d 692, 493 N.E.2d 146.) This record shows grossly inadequate evidence to support the reasonableness of the attorney fees and costs which the majority now awards to Hanover in full. Notably, it was the attorney retained at the sole cost of Fried who filed the original complaint for declaratory judgment, filed Hanover’s motion for summary judgment, and filed all pleadings up until the date of the July 27, 1982, trial court order. Other legal services consisted only of two appearances in court regarding Hanover’s demands for attorney fees. Also, the legal complexity or novelty of Hanover’s position is belied by its repeated declarations that its position was completely neutral as it was “merely a stakeholder.” In addition, if any award were made at all, the trial court correctly reduced the fees requested by Hanover. From the date of the June 29, 1983, Rule 23 order, nothing remained regarding Fried’s position in relation to Hanover and the void bond. Thus, the subsequent litigation in which Hanover sought attorney fees was not a “direct consequence of the execution of the bond” pursuant to the indemnity agreement. The trial court in the present dispute stated: “From the moment this case began, not just reached this court, it seems to be a classic case of litigation run amok. Neither side in my view is blameless. * * * What I have done is, based upon the entire record, the papers filed, the hearing conducted today and all the arguments of lawyers, is to review the time spent on those portions of the proceedings that I believe are reasonably related to the execution of the appeal bond and necessarily incurred as a direct consequence of the execution of the bond. I find that some of the time claimed ought not to be charged to Fried because it was not directly incurred as a result of the execution of the bond. I think it is necessary to avoid windfalls to Hanover inasmuch as the fees were unnecessary in the execution. I find that the concern with Hanover about its ability to write bonds in the Circuit Court might be a degree of concern. It is not something that Fried should be legally obligated to pay as a direct consequence of the execution of the bond.” If I were to find Hanover was entitled to attorney fees as a matter of law, I would also hold that the trial court properly reduced the total fees requested.   Justice McNamara participated in this opinion prior to his assignment to the sixth division.