Court Opinion

ID: 3137194
Source: CourtListenerOpinion
Date Created: 2015-10-22 17:46:00.778643+00
Date Added: 2024-06-11T12:14:55.065600
License: Public Domain

NO.  5-95-0701

                                  IN THE

                        APPELLATE COURT OF ILLINOIS

                              FIFTH DISTRICT

_________________________________________________________________

FIRST NATIONAL BANK OF SPRINGFIELD,  )  Appeal from the  

Guardian of the Estate of CHRISTY L. )  Circuit Court of 

MOLLET, a minor; JANICE L. MOLLET;   )  Montgomery County.

and MICHAEL MOLLET,                  )

                                     )

     Plaintiffs-Appellees and        )

     Cross-Appellants,               )

                                     )

v.                                   )  No. 91-MR-36

                                     )

MALPRACTICE RESEARCH, INC., d/b/a    )

THE MEDICAL QUALITY FOUNDATIONS,     )

and H. BARRY JACOBS, M.D.,           )

                                     )  Honorable

     Defendants-Appellants and       )  Mark M. Joy,

     Cross-Appellees.                )  Judge, presiding.

_________________________________________________________________

     JUSTICE WELCH delivered the opinion of the court:

     The question presented in this appeal from a summary judgment

entered in a declaratory judgment action is simply whether a

contract entered into between plaintiffs, First National Bank of

Springfield, guardian of the estate of Christy L. Mollet, a minor,

and Janice L. Mollet and Michael Mollet, and defendants, Malprac-

tice Research, Inc., d/b/a The Medical Quality Foundation, and H.

Barry Jacobs, M.D., is void as contrary to the public policy of the

State of Illinois.  The circuit court of Montgomery County so

found, and defendants appeal.  

     Plaintiffs herein were also plaintiffs in a medical mal-

practice suit brought to recover damages for birth injuries to the

minor, Christy L. Mollet.  Through their attorney, Douglas Marti,

plaintiffs entered into a contract with defendants herein, a

medical/legal consulting firm and its medical director, to provide

technical assistance for the education of counsel, to endeavor to

obtain expert witnesses, and to assist in marshalling evidence in

support of the medical malpractice claim.  

     The contract provides that its purpose is to help defray the

plaintiffs' cost of litigation and that defendants will make their

expertise available to plaintiffs' attorney and will make expert

witness reports and expert witnesses on its consulting staff

available to plaintiffs.  Dr. Jacobs was to be available at any

time for plaintiffs' attorney to answer questions or assist in

depositions or at trial.  The contract further provides that defen-

dants shall attempt to locate expert medical witnesses but that

defendants cannot guarantee the wording or substance of reports, or

the quality, nature, or admissibility of the experts' testimony, or

the credentials of the experts.

     There was to be a charge of $150 for each expert witness

report and a charge of $500 per day for the testimony of any expert

witness.  A fee of $75 per hour was to be paid for depositions of

expert witnesses.  These fees were payable in advance.  Plaintiffs

were free to also find their own expert witnesses outside the

contract without any effect on the contract.  

     In addition to the expert witness fees mentioned above,

plaintiffs were to pay to defendants a contingent fee of 20% of any

amounts recovered in the medical malpractice action.  The sum of

$10,000 is set forth as liquidated damages in the event the

contingent fee is not paid.   

     Because the injured plaintiff was a minor, defendants asked

plaintiffs to seek and obtain court approval of the contract prior

to defendants expending any effort pursuant thereto.  Plaintiffs

petitioned for court approval of the contract, representing to the

court that they "have insufficient financial resources with which

to properly prepare their case without entering into the attached

contract".  The petition also informed the court that the contract

provides for a 20% contingent fee to defendants in the event of any

recovery in the medical malpractice action.  The contract was

approved by the circuit court of Montgomery County on January 3,

1986.

     It appears from the record that defendants did provide some

services to plaintiffs in the medical malpractice action and did

locate several expert witnesses who were willing to testify.  It

appears that two of these witnesses were deposed.  However, it also

appears that plaintiffs' original attorney, Douglas Marti, who had

negotiated the contract between plaintiffs and defendants, withdrew

from the medical malpractice action and was replaced with attorney

M. John Hefner, Jr.  Hefner did not utilize the services of

defendants, although defendants notified Hefner that they were

willing and able to assist in the medical malpractice action. 

Hefner negotiated a $500,000 settlement of the medical malpractice

action.  He then brought this declaratory judgment action seeking

to have the contract between plaintiffs and defendants declared

void as contrary to the public policy of the State of Illinois.  He

succeeded.  Defendants appeal.

     It is well settled that courts will not enforce a private

agreement which is contrary to public policy.  O'Hara v. Ahlgren,

Blumenfeld & Kempster, 127 Ill. 2d 333, 341 (1989).  The public

policy of this State is reflected in its Constitution, its

statutes, and its judicial decisions.  O'Hara, 127 Ill. 2d at 341. 

Whether or not a contract is contrary to public policy depends on

the peculiar facts and circumstances of each case.  O'Hara, 127

Ill. 2d at 341-42.  In deciding whether a contract that is not

otherwise prohibited by law violates public policy, the courts must

determine whether the agreement is so capable of producing harm

that its enforcement would be contrary to the public interest. 

O'Hara, 127 Ill. 2d at 342.  A court will not declare a contract

illegal unless it expressly contravenes the law or a known public

policy of this State, as public policy strongly favors freedom to

contract.  Rome v. Upton, 271 Ill. App. 3d 517, 520 (1995).  The

question of whether a contract is enforceable under considerations

of public policy is one of law.  Rome, 271 Ill. App. 3d at 520.

     Let us make clear what the contract is not before we proceed

with our discussion of its legality.  The contract is clearly not

one to pay a contingent fee to expert witnesses.  This clearly

would be prohibited by Rule 3.3(a)(15) of the Illinois Rules of

Professional Conduct.  134 Ill. 2d R. 3.3(a)(15).  Only the medi-

cal/legal consulting firm is to receive a contingent fee.  Expert

witnesses are to be paid an hourly or flat fee for their profes-

sional services.  Nor is the contract one involving the sharing of

legal fees between the plaintiffs' attorney and defendants, which

would be prohibited by Rule 5.4(a) of the Illinois Rules of

Professional Conduct.  134 Ill. 2d R. 5.4(a).  There is no

provision in the contract that the defendants' 20% contingent fee

is to come out of the fee of plaintiffs' attorney.  Instead,

defendants' fee is to come out of plaintiffs' award.  Furthermore,

the contract does not guarantee that defendants will be able to

find any expert witnesses to testify in support of plaintiffs'

claim or the content or substance of any expert testimony.

     Plaintiffs argue that the public policy of this State is

enunciated in two ancient cases decided by our supreme court in

1873 and 1893.  In Gillett v. Board of Supervisors of Logan County,

67 Ill. 256 (1873), the county entered into a contract with an

individual whereby the individual was to "hunt up testimony" to be

used to prove voter fraud in a county election.  The "witness

finder" was to receive $100 for the first 10 votes proved to be

illegal, $200 for the next 10 votes proved to be illegal, etc., and

the further sum of $1,200 if the case was decided in favor of the

county.  Our supreme court held that this contract was void as

contrary to public policy, stating:

          "But the contracts, themselves, are pernicious in their

     nature.  They created a powerful pecuniary inducement on the

     part of the agents so employed, that testimony should be given

     of certain facts, and that a particular result of the suit

     should be had.  A strong temptation was held out to them to

     make use of improper means to procure the needful testimony,

     and to secure the desired result of the suit.  The nature of

     the agreement was to encourage attempts to suborn witnesses,

     to tamper with jurors, and to make use of other `base ap-

     pliances' in order to secure the necessary results which were

     to bring to these agents their stipulated compensation." 

     Gillett, 67 Ill. at 261.

     In Goodrich v. Tenney, 144 Ill. 422 (1893), Goodrich and

Tenney, an attorney, entered into an agreement whereby Goodrich was

to receive 25% of any amount collected by Tenney in a lawsuit to

invalidate the transfer of a debtor's property.  Goodrich was to

produce affidavits and witnesses testifying that no consideration

had been given for the property and that the purchasers knew of the

debtor's insolvency at the time of the transfer.  Relying on

Gillett, our supreme court held the contract void as contrary to

public policy.  The court found that the tendency of such contracts

to the perversion of justice through subornation of perjury renders

them illegal.

     We cannot agree with plaintiffs that these cases represent the

public policy of the State of Illinois with respect to the contract

in the case at bar.  We think that they are inapposite to the case

at bar for several reasons.  First, the witnesses sought to be

procured in Gillett and Goodrich were fact witnesses, while the

witnesses to be procured by defendants in the case at bar are

expert opinion witnesses.  Secondly, the witnesses sought to be

procured in Gillett and Goodrich were to testify to certain express

and specified facts.  In the case at bar, defendants have not

agreed to find witnesses to testify to any particular facts or

opinions.  Indeed, the contract explicitly states that defendants

cannot guarantee the wording or substance of reports or the nature

of the experts' testimony.  Finally, in Gillett and Goodrich, the

witness finders did not get paid under the contract unless they

found witnesses to testify to the specified facts.  In the case at

bar, defendants are entitled to their contingent fee whether or not

they are able to procure expert witnesses for plaintiffs, provided

that plaintiffs prevail in their medical malpractice action.  The

contract in the case at bar does not require that defendants

procure any expert witnesses.  It requires only that defendants

"attempt to locate expert witnesses".  Defendants provide other

services under the contract for which they are apparently entitled

to receive their contingent fee even if they are unsuccessful in

locating expert witnesses.

     We find that there are substantial differences between the

contracts in the Gillett and Goodrich cases and the contract in the

case at bar.  We do not believe that Gillett and Goodrich express

a public policy against contracts such as the one at bar.  As we

have stated, whether or not a contract is contrary to public policy

depends on the peculiar facts and circumstances of each case. 

O'Hara v. Ahlgren, Blumenfeld & Kempster, 127 Ill. 2d 333, 341-42

(1989).

     Plaintiffs also argue that a 1991 advisory opinion of the

Illinois State Bar Association enunciates a public policy against

contracts such as the one at bar.  In that advisory opinion, the

Bar Association states its opinion that it is professionally

improper for an attorney to hire, or to recommend or acquiesce in

his client hiring, an agency to provide an expert witness where the

agency's compensation is contingent upon the outcome of the matter. 

ISBA Op. No. 86-3 (January 1991).  We think it clear that the

Illinois State Bar Association does not express the public policy

of the State of Illinois.  As we have stated, the public policy of

this State is to be found in its Constitution, statutes, and

judicial decisions.  O'Hara v. Ahlgren, Blumenfeld & Kempster, 127

Ill. 2d 333, 341 (1989).  

     Plaintiffs direct us to no other sources of expression of

public policy with respect to contracts such as the one at bar, and

we are unable to find any.  Accordingly, we must determine whether

the contract is so capable of producing harm that its enforcement

would be contrary to the public interest.  O'Hara v. Ahlgren,

Blumenfeld & Kempster, 127 Ill. 2d 333, 342 (1989). 

     We do not see any overwhelming danger of subornation of

perjury in the contract.  The witnesses sought to be procured are

expert opinion witnesses as opposed to fact witnesses.  Defendants

are not obligated to find witnesses to testify to any specific

facts or opinions.  Furthermore, defendants receive their contin-

gent fee whether or not witnesses are found, if plaintiffs are suc-

cessful in their medical malpractice action.  The temptation for

subornation of perjury which was present in Gillett and Goodrich

does not appear to be present in the case at bar.  While defendants

have an interest in seeing that plaintiffs prevail in the medical

malpractice action, defendant can influence the result in ways

other than suborning perjury.  Under the contract, the defendants

are obligated to assist plaintiffs in numerous ways other than the

procurement of expert witnesses.  We conclude that the contract

does not create a real and substantial danger of subornation of

perjury such that its enforcement would be contrary to the public

interest.  

     We are also mindful that the contract takes another slice out

of plaintiffs' pie in that, in addition to the contingent fee

payable to plaintiffs' attorney, a contingent fee is payable to

defendants under the contract.  However, we are also mindful that,

without the services provided by defendants, many medical malprac-

tice cases, including plaintiffs', might not make it past the

courthouse door.  Medical malpractice cases are becoming increas-

ingly complex, and even experienced attorneys may not have suffi-

cient knowledge or resources to properly prepare a medical

malpractice case without expert assistance.  Even experienced

malpractice attorneys cannot understand all the complex matters

involved in some medical malpractice cases.  Furthermore, there is

a recognized scarcity of expert medical witnesses who are willing

and able to testify against their colleagues in the medical field. 

The task of locating an expert witness to testify against another

physician in a medical malpractice case is well known to be an

expensive, time-consuming, and often unsuccessful task which

plaintiffs or their attorneys must undertake in a medical mal-

practice case.  The services provided by medical/legal consulting

firms in explaining complex medical matters, assisting in the

preparation of questions for witnesses and parties, developing the

case, and finding appropriate expert witnesses may be invaluable in

certain cases.  Finally, many medical malpractice plaintiffs are

simply financially unable to pay for their attorney's services on

anything other than a contingent fee basis, much less pay for the

services provided by medical/legal consulting firms on anything

other than a contingent fee basis.  Indeed, plaintiffs in the case

at bar admitted in their petition for approval of the contract that

they had insufficient financial resources with which to properly

prepare their case without entering into the contract with

defendants.  Not all attorneys and law firms can afford to advance

such costs to their clients. 

     We conclude that medical/legal consulting firms such as

defendants can provide a legitimate and valuable service to those

injured through medical malpractice, but that many cannot afford

such services except through a contingent fee contract.  We do not

find that the contract between plaintiffs and defendants is so

capable of producing harm that its enforcement would be contrary to

the public interest.  Accordingly, we find that the contract in the

case at bar is not violative of the public policy of this State and

is legal and enforceable.  

     We return now to the facts of this case.  After finding that

the contract was void and unenforceable, the trial court entered

summary judgment for plaintiffs on count I of defendants' coun-

terclaim.  This counterclaim had sought enforcement of the contract

and the sums due thereunder.  We reverse that summary judgment and

enter summary judgment against plaintiffs and for defendants in the

amount of $100,000, representing 20% of plaintiffs' $500,000

recovery.  That provision of the contract providing for additional

liquidated damages in the amount of $10,000 should the contingent

fee not be timely paid is unenforceable pursuant to Telenois, Inc.

v. Village of Schaumburg, 256 Ill. App. 3d 897, 902 (1993). 

Further, pursuant to the power granted us by Supreme Court Rule

366(a)(5) (134 Ill. 2d R. 366(a)(5)), we hereby enter judgment in

favor of defendants and against plaintiffs on all counts of the

declaratory judgment action brought by plaintiffs. 

     The trial court also entered judgment for defendants and

against plaintiffs on count II of the defendants' counterclaim,

which sought recovery in quantum meruit for the services provided

by defendants.  In light of our disposition with respect to count

I of the counterclaim, we hereby vacate the judgment of the circuit

court on count II of the counterclaim.

     Finally, in their briefs, defendants argue that the trial

court erred in denying their special and limited appearance for the

purpose of contesting the jurisdiction of the court.  In their oral

argument before this court, defendants conceded that they had

waived any error in the denial of their special and limited

appearance by participating in the proceedings before the trial

court.  Accordingly, we will not discuss this issue.

     For the foregoing reasons, judgment is hereby entered in favor

of defendants and against plaintiffs on all counts of plaintiffs'

complaint for declaratory judgment.  The summary judgment of the

circuit court of Montgomery County in favor of plaintiffs and

against defendants on count I of defendants' counterclaim is hereby

reversed, and judgment is hereby entered thereon against plaintiffs

and in favor of defendants in the amount of $100,000 plus costs of

suit.  The judgment entered by the circuit court of Montgomery

County in favor of plaintiffs and against defendants on count II of

defendants' counterclaim is hereby vacated.

     Reversed in part; vacated in part; judgment entered.

     RARICK and MAAG, JJ., concur.

                                      NO. 5-95-0701

                                     IN THE

                          APPELLATE COURT OF ILLINOIS

                                 FIFTH DISTRICT

___________________________________________________________________________

FIRST NATIONAL BANK OF SPRINGFIELD,  )  Appeal from the  

Guardian of the Estate of CHRISTY L. )  Circuit Court of 

MOLLET, a minor; JANICE L. MOLLET;   )  Montgomery County.

and MICHAEL MOLLET,                  )

                                     )

     Plaintiffs-Appellees and        )

     Cross-Appellants,               )

                                     )

v.                                   )  No. 91-MR-36

                                     )

MALPRACTICE RESEARCH, INC., d/b/a    )

THE MEDICAL QUALITY FOUNDATIONS,     )

and H. BARRY JACOBS, M.D.,           )

                                     )  Honorable

     Defendants-Appellants and       )  Mark M. Joy,

     Cross-Appellees.                )  Judge, presiding.

___________________________________________________________________________

Opinion Filed:                 December 19, 1996

___________________________________________________________________________

Justices:      Honorable Thomas M. Welch, J.

                         

               Honorable Philip J. Rarick, J., and 

               Honorable Gordon E. Maag, J.,

               Concur

___________________________________________________________________________

                         

Attorneys      Raymond E. McPhail, Bullington, White, McPhail and Jarman, 

for            P.C., 127 North Main Street, P.O. Box 190, Hillsboro, IL

Appellant      62049; Deborah A. Vitale, 1013 Princess Street, Alexandria,

               VA  22314

___________________________________________________________________________

Attorneys      Paul Brown, Emmet A. Fairfield, Brown, Hay & Stephens, 700

for            First National Bank Bldg., P.O. Box 2459, Springfield, IL

Appellee       62705

___________________________________________________________________________