Court Opinion

ID: 3146745
Source: CourtListenerOpinion
Date Created: 2015-10-22 18:21:21.20613+00
Date Added: 2024-06-11T11:46:33.296215
License: Public Domain

SECOND DIVISION
                                                   March 30, 2007

Nos. 1-06-1274 and 1-06-2637, Consolidated

DALAN/JUPITER, INC., for the use and     )    Appeal from the
benefit of JRC MIDWAY MARKETPLACE,       )    Circuit Court of
L.P.,                                    )    Cook County.
                                         )
     Plaintiff-Appellant,                )
                                         )
          v.                             )
                                         )
DRAPER AND KRAMER, INC.,                 )    Honorable
                                         )    Stuart A. Nudelman,
     Defendant-Appellee.                 )    Judge Presiding.

     PRESIDING JUSTICE WOLFSON delivered the opinion of the

court:

     In law, as in life, missed opportunities can prove costly.

Here, the question is whether the appellant’s failure to raise

the issue of its entitlement to attorney fees and costs in a

contract dispute in this court bars it from asking the trial

court to award fees and costs provided for in the contract.

     We hold the doctrine of res judicata bars the appellant’s

claim for fees and costs.   In the second issue in this

consolidated appeal, we affirm the trial court’s award of

attorney fees to the appellee for a discovery sanction, but

modify the amount.

FACTS

Res Judicata
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     In 1994, Draper and Kramer, Inc. (Draper) filed a breach of

contract action against Dalan/Jupiter, Inc. (Dalan) and Trammell

Crow Company Houston, Inc. (Trammell), alleging Dalan and

Trammell failed to pay a commission due under a mortgage

brokerage agreement.   After a bench trial, the trial court ruled

in favor of Draper against both defendants and awarded it

$550,252.22, including attorney fees.    Dalan did not request

attorney fees in any of its pleadings in that lawsuit.

     On appeal, this court reversed, finding the defendants did

not breach the agreement.   There was no remand.     Draper & Kramer,

Inc. v. Dalan/Jupiter, No. 1-00-3592 (2001) (unpublished order

under Supreme Court Rule 23).    In its briefs in this court, Dalan

did not request a remand to decide the issue of attorney fees.

Nor did it file a petition to request a remand within 21 days of

the reversal.   Draper’s petition for leave to appeal to the

Supreme Court was denied.   The mandate was filed in the trial

court on January 9, 2002.

     Within 30 days of the filing of the mandate, Trammell filed

a petition for fees and costs under the prevailing party clause

of its contract with Draper.    The clause states:

          "[i]n the event of any controversy, claim or

          dispute between the undersigned parties

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           arising out of or relating to this agreement

           or the breach hereof, the prevailing party

           shall be entitled to recover from the losing

           party, reasonable expenses, attorneys’ fees

           and costs."

     On April 16, 2002, Dalan filed its own petition in the trial

court for attorney fees and costs "for the use of JRC Midway

Marketplace, L.P."   Dalan based its petition on the prevailing

party clause in the agreement between Draper and Trammell.

Draper filed a motion for summary judgment, contending, among

other things, Dalan never was a party to the agreement, its

petition was not timely filed, and it waived the right to seek

fees and costs.

     On February 21, 2003, the trial court entered an order

stating:

           "This matter coming to be heard on Draper and

           Kramer’s motion for summary judgment denying

           the Petition of Dalan/Jupiter for the use of

           JRC Midway Marketplace for Attorneys’ Fees

           and Costs, it is ordered:

           1. That the Court finds that it does not have

           jurisdiction over Dalan/Jupiter’s Petition

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            because it was not timely filed, and thus

            sees no reason to pass on the other issues

            presented by Draper and Kramer’s petition

            and, on that basis denies Dalan/Jupiter’s

            Petition;

            2. This Court makes no findings through this

            Order against [Trammell].

            3. This matter is set for case management

            status on March 26, 2003 at 9:20 a.m."

Dalan did not file a motion for reconsideration of the order.

     On March 20, 2003, Dalan filed a notice of appeal of the

February 21, 2003, order.    Dalan did not seek a Rule 304(a)

finding to allow for the immediate appeal of the order.    Draper

moved to dismiss the appeal on the grounds that the order was

neither final nor appealable because Trammell’s fee petition was

pending.    On June 2, 2003, this court dismissed Dalan’s appeal

and remanded to the circuit court.

     On July 13, 2005, the trial court entered an order

dismissing with prejudice the underlying litigation.

     Earlier, on May 20, 2003, Dalan had filed a lawsuit against

Draper.    This is the lawsuit that gives rise to this appeal.   On

April 8, 2004, it filed its First Amended Complaint, including

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separate counts for breach of contract, subrogation, and unjust

enrichment.   All three counts are based on the prevailing party

clause in the February 18, 1991, Engagement Agreement between

Draper and "TCC," defined in the agreement as "Trammell Crow

Company, its successors, assigns and/or related entities."    In

its brief, Dalan admits its lawsuit alleges "the same claims pled

in its fee petition in the Prior Lawsuit but adding as Count III

a claim for unjust enrichment."    (Emphasis added.)   In the unjust

enrichment count, Dalan alleges Draper would be unjustly enriched

if it were not required to pay all the attorney fees and costs

Dalan incurred in defending Trammell, including fees and costs

incurred by Dalan and paid by JRC.     Dalan requests attorney fees

and costs in the amount of $318,020.89, plus costs and fees

incurred in the instant lawsuit.

     On November 23, 2004, Draper filed a motion for summary

judgment, contending Dalan had admitted before the court there

was no contract between it and Draper, and the absence of

separate counsel for Trammell could not be deemed a benefit that

Draper voluntarily accepted.

     On February 3, 2005, the court granted Draper’s motion as to

the unjust enrichment count, but denied the motion as to the

breach of contract and subrogation counts.

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     On October 26, 2005, Draper filed a motion for summary

judgment based on res judicata.    On the same date, Dalan filed a

motion for summary judgment as to liability on Counts I and II of

its First Amended Complaint.

     On April 6, 2006, the court entered an order granting

Draper’s motion for summary judgment based only on res judicata

and denying Dalan’s motion for summary judgment on liability.

     On April 27, 2006, Dalan filed its notice of appeal from the

April 6, 2006, order, requesting that this court reverse the

grant of summary judgment for Draper, grant summary judgment as

to liability in favor of Dalan on Count I, and remand to the

circuit court.

Discovery Violation Sanction

     On January 4, 2005, Draper filed a motion to bar witnesses

at trial based on Dalan’s failure to identify any witnesses who

would testify at trial, despite two court orders requiring it to

do so.

     On March 21, 2005, the court entered an order: (1) allowing

Dalan to designate Henry Krasnow as its expert witness and

allowing Draper to take Krasnow’s deposition within 30 days; (2)

allowing Dalan to designate Michael Pompizzi and Henry Krasnow as

its Rule 213 witnesses; and (3) ordering Dalan to pay as a

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sanction the attorney fees and costs for bringing Draper’s motion

and Draper’s deposition of Krasnow.   Pursuant to the order,

Draper filed its petition for fees and costs.

     At the hearing on the petition, Draper’s attorney, Steven

Roeder, testified about the basis for the fees and offered his

opinion about the reasonableness of the fees.   Dalan’s counsel

did not cross-examine Roeder, nor did Dalan present any witnesses

to rebut the evidence.   The court granted Draper’s fee petition

in its entirety, awarding Draper $15,928.35 in fees and costs.

     Dalan filed a notice of appeal from the order, asking this

court to reverse the fee award to Draper.   In the same notice of

appeal, Dalan asked this court to reverse the trial court’s

February 3, 2005, entry of summary judgment for Draper on Count

III of Dalan’s First Amended Complaint.   Dalan’s two notices of

appeal were consolidated.

DECISION

I. Res Judicata

     Our review of the trial court’s grant of summary judgment is

de novo.   Chatham Foot Specialists, P.C. v. Health Care Service

Corp., 216 Ill. 2d 366, 376, 837 N.E.2d 48 (2005).   We may affirm

the trial court’s judgment on any ground appearing in the record,

regardless of the actual reasoning or grounds relied on by the

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court.    Kostal v. Pinkus Dermatopathology Laboratory, P.C., 357

Ill. App. 3d 381, 384, 827 N.E.2d 1031 (2005).

     "The doctrine of res judicata provides that a final judgment

rendered by a court of competent jurisdiction on the merits is

conclusive as to the rights of the parties and their privies,

and, as to them, constitutes an absolute bar to a subsequent

action involving the same claim, demand or cause of action."

Nowak v. St. Rita High School, 197 Ill. 2d 381, 389, 757 N.E.2d

471 (2001).    Res judicata is conclusive as to any matter that was

offered to sustain or defeat the claim or demand, as well as any

other matter that might have been offered for that purpose.

Nowak, 197 Ill. 2d at 389; Housing Authority for LaSalle County

v. YMCA of Ottawa, 101 Ill. 2d 246, 251-52, 461 N.E.2d 959

(1984); Sarno v. Thermen, 239 Ill. App. 3d 1034, 1045, 608 N.E.2d

11 (1992).

     For the doctrine to apply, three requirements must be met:

(1) a final judgment on the merits rendered by a court of

competent jurisdiction; (2) an identity of causes of action; and

(3) an identity of parties or their privies.     Nowak, 197 Ill. 2d

at 390.

     A judgment is not res judicata unless it is rendered on the

merits.    Russell v. Klein, 46 Ill. App. 3d 660, 663, 361 N.E.2d

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65 (1977).    A judgment is not on the merits when it is based

solely on a lack of subject matter jurisdiction.    River Park,

Inc. v. City of Highland Park, 184 Ill. 2d 290, 303, 703 N.E.2d

883 (1998).

     The parties agree there is an identity of parties and an

identity of causes of action--at least for the breach of contract

and subrogation counts.    The issue is whether there was a final

judgment on the merits rendered by a court of competent

jurisdiction.    Dalan contends that because the trial court said

it did not have jurisdiction to consider the merits of its fee

petition, the court’s February 23, 2003, order can have no res

judicata effect on a separate lawsuit alleging the same claims

for fees.

     The February 23, 2003, order does not control this case.

When we reversed the trial court’s judgment in 2001, we did not

remand the case to the trial court.    The trial court had no

jurisdiction to consider Dalan’s fee petition or any other

matters pertaining to the case.    Supreme Court Rule 369(b)

provides "other proceedings may be conducted" on the filing of

the mandate in the circuit court following dismissal of an appeal

or an affirmance by the reviewing court.    134 Ill. 2d R. 369(b).

Rule 369(b) embodies the Illinois Supreme Court’s holding in

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Watkins v. Dunbar, 318 Ill. 174, 149 N.E. 14 (1925).     See Russell

v. Klein, 46 Ill. App. 3d 660, 664-65, 361 N.E.2d 65 (1977).       It

does not apply to reversal without remand.    Rule 369(c) provides

for reinstatement of a case in the circuit court following remand

for a new trial or hearing.    134 Ill. 2d R. 369(c).

       In Watkins, the court held that where a judgment is

reversed, and the cause remanded, the case is reinstated by

filing a transcript of the remanding order with the clerk of

court.    Watkins, 318 Ill. at 177.   However, where a judgment is

reversed with no order remanding the case, "it cannot be

reinstated in the court which entered the judgment from which the

appeal was taken***"    (Emphasis added.)   Watkins, 318 Ill. at

177.    In other words, following a reversal without remand, the

trial court is not revested with jurisdiction over the case.

       We see no reason to depart from the holding in Watkins.     See

Russell, 46 Ill. App. 3d at 664 (noting     Rule 369(b) embodies the

principle of law enunciated by the court in Watkins); Perrin v.

Pioneer National Title Insurance Co., 108 Ill. App. 3d 181, 185,

438 N.E.2d 1359 (1982) (same); but see Coldwell Banker Havens,

Inc. v. Renfro, 288 Ill. App. 3d 442, 445, 679 N.E.2d 1299

(1997), where the court allowed a fee petition to go forward

where it was filed within 30 days of the appellate court’s

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reversal without remand, the party having requested fees in its

counterclaim.   We believe the court in Coldwell Banker misread

Rule 369(b).

     We find this case fits squarely within the doctrine of res

judicata, for a reason different from that relied on by Draper

and by the trial court.   The trial court’s February 21, 2003,

order was not a "final judgment on the merits by a court of

competent jurisdiction" because by that time the court had lost

subject matter jurisdiction over the case.    However, our July 25,

2001, decision was a final decision on the merits.

     In the first appeal, following the trial court’s judgment in

favor of Draper, Dalan could have requested that this court

remand the case to the trial court to consider Dalan’s claim for

fees.   We take judicial notice of Dalan’s briefs in that appeal.

Dalan asked only to "reverse the judgment of the trial court and

remand with directions to enter judgment in favor of Dalan."

There was no mention of Dalan’s fees.    Furthermore, Dalan argued

in its briefs that both parties were prevailing parties and were

not entitled to fees.   Then it argued that neither party was a

prevailing party.   Its arguments were directed solely at the

attorney fees awarded to Draper.     Dalan never indicated it might

be entitled to fees.

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     Then, Dalan had an opportunity, within 21 days of our

reversal, to file a petition for rehearing requesting that we

amend our mandate to remand the case for consideration of

attorney fees.    Instead, Dalan waited to file its petition in the

trial court until three months after our mandate had been filed.

See People v. Lyles, 217 Ill. 2d 210, 216-17, 840 N.E.2d 1187

(2005) (following the elapse of the time for filing a petition

for rehearing, an appellate court is without jurisdiction to take

further action in the case).   Then, when the trial court

dismissed its petition, Dalan tried for another "bite at the

apple" by filing a collateral complaint directed at the same

fees.   See Peregrine Financial Group, Inc. v. Ambuehl, 309 Ill.

App. 3d 101, 109, 722 N.E.2d 723 (1999).   We decline to allow

Dalan this opportunity.    See Mann v. Rowland, 342 Ill. App. 3d

827, 835, 795 N.E.2d 924 (2003) (proper recourse to challenge

voluntary dismissal in a federal district court was in the

district court or a federal appeals court, not in a subsequent

state court suit).

     Res judicata is an equitable doctrine designed to prevent a

multiplicity of lawsuits between the same parties where the facts

and issues are the same.    Piagentini v. Ford Motor Co., 366 Ill.

App. 3d 395, 398, 852 N.E.2d 356 (2006).    The doctrine "promotes

judicial economy by preventing repetitive litigation and also

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protects parties from being forced to bear the unjust burden of

relitigating essentially the same case."    Arvia v. Madigan, 209

Ill. 2d 520, 533, 809 N.E.2d 88 (2004).    Allowing Dalan to take

advantage of the trial court’s loss of jurisdiction to file a

separate claim for fees is not consistent with equitable

principles.

     Our decision does not rest on Dalan’s failure to file a

counterclaim for fees in the first lawsuit.   We recognize

counterclaims in Illinois are permissive, not mandatory.     735

ILCS 5/2-608(a) (West 2000).   We rely on the failure to raise the

fees issue in the first appeal, before and after our decision to

reverse without remand.   Our supreme court, applying the

transactional test for res judicata, has held a party’s failure

to raise claims it could have raised in another, substantially

identical case, even though there was a chance the claims might

have been dismissed for lack of jurisdiction, raises the bar of

res judicata for those claims.   River Park, Inc. v. City of

Highland Park, 184 Ill. 2d 290, 318-19, 703 N.E.2d 883 (1998).

     We affirm the trial court’s grant of summary judgment as to

Counts I and II of Dalan’s First Amended Complaint.

     We find Count III of Dalan’s First Amended Complaint, for

unjust enrichment, also is barred by res judicata.    To determine

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whether there is an identity of causes of action, Illinois courts

employ a "transactional" test.    Under this test, separate claims

will be considered the same cause of action for purposes of res

judicata if they arise from a single group of operative facts,

regardless of whether they assert different theories of relief.

River Park, 184 Ill. 2d at 307; Corcoran-Hakala v. Dowd, 362 Ill.

App. 3d 523, 526, 840 N.E.2d 286 (2005).

     The unjust enrichment count of Dalan’s complaint seeks the

same relief, based on the same set of operative facts, as the

breach of contract and subrogation counts.    There was nothing to

prevent Dalan from raising an unjust enrichment claim in the

first appeal.

II. Discovery Violation

     Whether a party is guilty of a discovery violation is an

issue of law, which we review de novo.     People v. Hood, 213 Ill.

2d 244, 256, 821 N.E.2d 258 (2004).    A trial court’s decision as

to the appropriate sanction for a discovery violation is subject

to review for an abuse of discretion.    Hood, 213 Ill. 2d at 256.

     Dalan contends it did not commit a discovery violation for

which sanctions were warranted.    The trial court imposed

sanctions pursuant to Supreme Court Rule 219(c) for violating

Rule 213(f), which provides: "Upon written interrogatory, a party

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must furnish the identities and addresses of witnesses who will

testify at trial."   Official Reports Advance Sheet No. 8 (April

17, 2002), R. 213(f), eff. July 1, 2002.   Parties must identify

the subjects on which lay witnesses and expert witnesses will

testify, and, for expert testimony, the opinions the party

expects to elicit.

     Supreme Court Rule 213 disclosures are mandatory and must be

strictly followed, both by the parties and by the court imposing

the rules.   Foley v. Fletcher, 361 Ill. App. 3d 39, 46-47, 836

N.E.2d 667 (2005); McGovern v. Kaneshiro, 337 Ill. App. 3d 24,

34, 785 N.E.2d 108 (2003).   The goals of these discovery rules

are "to avoid surprise and discourage tactical gamesmanship."

McGovern, 337 Ill. App. 3d at 34.

     Dalan challenges the validity of Supreme Court Rule 213(f),

contending it expressly conflicts with section 2-1003(c) of the

Code of Civil Procedure.   Section 2-1003(c) provides: "A party

shall not be required to furnish the names or addresses of his or

her witnesses, except that upon motion of any party disclosure of

the identity of expert witnesses shall be made***"   735 ILCS 5/2-

1003(c) (West 2004).

     We reject Dalan’s contention.   It is well settled in

Illinois that where a supreme court rule conflicts with a statute

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on the same subject, "the rule will prevail."    O’Connell v. St.

Francis Hospital, 112 Ill. 2d 273, 281, 492 N.E.2d 1322 (1986);

People v. Cox, 82 Ill. 2d 268, 274, 412 N.E.2d 541 (1980).

     Alternatively, Dalan contends that even if its failure to

identify its trial witnesses was a violation of discovery rules,

the trial court abused its discretion in imposing sanctions

because Draper was not prejudiced.    The appropriate sanction, if

any, to be imposed for a party’s failure to list a witness in

response to a proper interrogatory is within the discretion of

the trial court.    Boatmen’s National Bank of Belleville v.

Martin, 155 Ill. 2d 305, 314, 614 N.E.2d 1194 (1993).    In its

answers to Draper’s First Set of Interrogatories and Requests to

Produce, Dalan was asked to identify the witnesses it intended to

call at trial.    Dalan answered: "Plaintiff has not yet determined

what witnesses it intends to call at the trial of this case."

     Dalan says its answer to another question was sufficient to

apprise Draper of the witnesses it intended to call at trial.     It

identified E. Michael Pompizzi and Henry C. Krasnow as

"individuals with any knowledge about any allegations of the

complaint, or any aspects of defendant’s answer, or any defense."

We disagree.   Dalan failed to answer the question that was asked-

-which witnesses it intended to call at trial.   We find no error

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in the trial court’s decision to award sanctions.   Rule 213 is

mandatory, and Dalan failed to strictly comply with the rule by

refusing to answer the interrogatory until it essentially was

forced to do so.

     Dalan contends the trial court abused its discretion in

awarding Draper the exact amount of fees it requested.   Given

that Dalan declined to cross-examine Draper’s witness at the

hearing, and failed to present any evidence to rebut the evidence

offered by Draper, we find no abuse of discretion in the trial

court’s decision--with one exception.   As the petitioning party,

the burden of proof was on Draper to establish the value of its

attorney fees, and it did so.   We do find the court abused its

discretion in awarding $4,000 for the deposition of Krasnow.     We

believe that amount was disproportional to the discovery

violation by Dalan.   A more appropriate amount would have been

$1,000.   Accordingly, we modify the court’s award, reducing the

amount of fees and costs awarded to Draper by $3,000, for a total

of $12,928.35.

Conclusion

     We affirm the trial court’s grant of summary judgment in

favor of Draper on Dalan’s complaint.   We decline to rule on

Dalan’s claim it should have been granted summary judgment as to

liability on Count I.   We modify the court’s order awarding

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attorney fees to Draper, changing the total amount to $12,928.35.

     Affirmed as modified.

     HOFFMAN, and SOUTH, JJ., concur.

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