Find Legal Information

SECOND DIVISION
June 4, 2002

JUSTICE McBRIDE delivered the opinion of the court:

On August 16, 2000, William Bruce Hoff, Jr. (Hoff), andCatherine Hoff, his wife, filed a complaint for declaratoryjudgment and other relief in the circuit court of Cook Countyagainst Mayer, Brown & Platt (MBP), a Chicago law firm. Thereafter, MBP filed a motion to dismiss plaintiff's complaintpursuant to section 2-615 of the Illinois Code of Civil Procedure (735 ILCS 5/2-615 (West 2000)). On June 12, 2001, the trial courtgranted defendant's motion. Hoff now appeals.

Hoff argues on appeal: (1) that the retirement provision inMBP's restated plan is a restrictive covenant and is contrary toIllinois public policy; (2) that the provision is unreasonablybroad; and (3) that under any circumstance, Hoff is entitled to atrial on the issues of whether he has materially competed with MBPand whether MBP can reasonably refuse to determine that any allegeddamage caused by Hoff has ended.

According to the complaint, Hoff resigned as a partner withMBP on July 9, 1993. At the time of his resignation, Hoff was 60years old and had been with MBP for 36 years. Hoff requestedretirement income from MBP. MBP has refused to pay Hoff retirementincome based on its "Restated Partnership Agreement, Retirement,Disability & Death Benefit Program" (Restated Plan or Plan). Inhis complaint, Hoff alleges that he should have been receiving inexcess of $94,000 per year in retirement income, plus additionalcost-of-living adjustments, pursuant to the Plan, since hisresignation in 1993. From the record below, there is no disputethat Hoff left MBP to become a founding partner in another Chicagofirm - Kasowitz, Hoff, Benson & Torres. Additionally, Hoffreceived all earned fee income, capital shares, financial benefits and other revenue to which he was entitled, based on hisassociation with MBP and his years of service to the firm. Hedisputes only MBP's decision to deny him retirement benefits.

A trial court ruling on a motion to dismiss under section 2-615 interprets all pleadings and supporting documents in the lightmost favorable to the nonmoving party. Dial Corp. v. Marine Officeof America, 318 Ill. App. 3d 1056, 1060, 743 N.E.2d 621 (2001). The lower court should grant a motion to dismiss only where itfinds that no set of facts would support a cause of action. DialCorp., 318 Ill. App. 3d at 1060. Because this approach does notrequire the trial court to weigh facts or determine the credibilityof witnesses, the appellate court reviews the matter de novo. DialCorp., 318 Ill. App. 3d at 1060.

The dispute here centers around sections 3.1 and 3.2 of MBP'sRestated Plan, and Rule 5.6 of the Illinois Rules of ProfessionalConduct (134 Ill. 2d R. 5.6). MBP's Restated Plan states:

"3.1 In General. If a member's membership inthe firm is terminated by reason of hisor her retirement on a retirement date(as described in subsection 3.2) on orafter January 1, 1987, he or she will beprovided with a retirement income in anamount determined in accordance with theprovisions of subsection 3.3.

3.2 Retirement Date. The 'retirement date'for a member is the one of the followingdates that applies in his or her case:

a.  Normal Retirement Date. The'normal retirement date' for amember shall be the first dayof the calendar  month as ofwhich he or she elects toretire or is retired by thefirm, provided in either eventthat, as of such day, he or sheshall have also either (i)attained at least 65 years ofage or (ii) attained at least62, but not yet attained 65,years of age and completed atleast 20 years' associated withthe firm.

For purposes of this program, a member shallnot be deemed to have elected to retire priorto attaining age 65 unless he or shesubstantially ceases the active practice oflaw on a permanent basis or his or her post-retirement practice of law is determined bythe firm to be consistent with his or herstatus as a retiree."

Rule 5.6(a) of the Illinois Rules of Professional Conduct,entitled "Restrictions on Right to Practice," provides: "A lawyershall not participate in offering or making: (a) a partnership oremployment agreement that restricts the rights of a lawyer topractice after termination of the relationship, except an agreementconcerning benefits upon retirement***." 134 Ill. 2d R. 5.6(a).

Hoff first claims that MBP's Restated Plan is basically arestrictive covenant and is contrary to Illinois public policy. Hoff argues that whether MBP's Plan comports with Rule 5.6(a)depends on whether the "benefits" under the Plan constitute"retirement benefits" under Rule 5.6(a).

Hoff correctly points out in his brief that under Rule 5.6(a),a lawyer may not participate in an agreement that "restricts therights of a lawyer to practice" after a relationship between thelawyer and firm has ended. 134 Ill. 2d R. 5.6(a). Illinois publicpolicy has consistently discouraged law firm employment agreementsthat contain noncompetition clauses or restrictive covenants. Stevens v. Rooks Pitts & Poust, 289 Ill. App. 3d 991, 998, 682N.E.2d 1125 (1997). Historically, these provisions have beenstrictly scrutinized by the courts as they can result in restraintson trade. Williams & Montgomery, Ltd. v. Stellato, 195 Ill. App.3d 544, 553, 552 N.E.2d 1100 (1990). "The rule is designed both toafford clients greater freedom in choosing counsel and to protectlawyers from onerous conditions that would unduly limit theirmobility." Dowd & Dowd, Ltd. v. Gleason, 181 Ill. 2d 460, 481, 693N.E.2d 358 (1998). Noncompetition clauses are especiallydiscouraged in the legal profession where the lawyer is not sellingor promoting a commodity but rather his or her personal service. Rule 5.6 was also designed to protect lawyers and clients from"illegitimate anti-competitive practices that will distort themarket and ultimately drive up the price of legal services." 2 G. Hazard & W. Hodes, The Law of Lawyering