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Schulson v. D'Ancona & Pflaum LLC

Case Date: 11/22/2004
Court: 1st District Appellate
Docket No: 1-03-1653 Rel

FIRST DIVISION
November 22, 2004





 

No. 1-03-1653

 

MICHAEL SCHULSON,

          Plaintiff-Appellant,

                       v.

D'ANCONA AND PFLAUM LLC; DEAN A. DICKIE;
ADELMAN, GETTLEMAN, MERENS, BERISH AND
CARTER, LTD.; HOWARD L. ADELMAN;
SONNENSCHEIN, NATH AND ROSENTHAL LLP; and
GERALD SHERMAN,

          Defendants-Appellees.

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)		 Appeal from
the Circuit Court
of Cook County



No. 00 L 12851



Honorable
Ronald P. Bartkowicz,
Judge Presiding.


PRESIDING JUSTICE CAHILL delivered the opinion of the court:

We are asked to decide whether a person sued for breach of contract may bring a third-party action for implied indemnity against lawyers who drafted the contract. The trial court heldthat a theory of implied indemnity will not support a third-party action where the underlyinglawsuit against the third-party plaintiff is grounded exclusively in breach of contract.

Plaintiff Michael Schulson filed a four-count legal malpractice action againstSonnenschein, Nath & Rosenthal LLP and Gerald J. Sherman (collectively, Sonnenschein),D'Ancona & Pflaum LLC and Dean A. Dickie (collectively, D'Ancona) and Adelman, Gettleman,Merens, Berish & Carter, Ltd., and Howard L. Adelman (collectively, Adelman). Because thiscase is related to Bank of America National Trust & Savings Ass'n v. Schulson, 305 Ill. App. 3d941, 714 N.E.2d 20 (1999), we begin with a summary of that case.

On September 30, 1991, Bank of America (bank) executed a loan agreement with LunanFamily Restaurants LP (Lunan) in which the bank agreed to loan Lunan $13.5 million to financethe purchase of about 30 Wags restaurants. Schulson, a general partner of Lunan, personallyguaranteed $3 million of the loan. The guarantee clause contained a "burn-down" provision thatacted to reduce Schulson's guarantee obligation "by an amount equal to 36% of any principalpayments" made on the loan. Sonnenschein represented Schulson in his dealings with the bankand participated in drafting the guarantee clause in the loan agreement.

In 1994, Lunan was struggling financially. On the advice of Sonnenschein, Lunan filed avoluntary petition for relief under chapter 11 of the Bankruptcy Code (11 U.S.C.