docket jul.exp lcba 6/27/13 11:58 pm page 1 d the ......20 by alex zagor a d v e r t i s e r s...

“Invite people to get involved with the LCBA.”

Steven McCollum, 2013-2014 LCBA President

July 2013THE

DOCKETVol.20, No.7 The Official Publication of the Lake County Bar Association

Docket JUL.exp_LCBA 6/27/13 11:58 PM

Inside this issue...

A publication of the

300 Grand Avenue, Suite AWaukegan, Illinois 60085Phone: (847) 244-3143Fax: (847) [email protected]

2013-2014 Officers & DirectorsSteven P. McCollum, PresidentKeith C. Grant, First Vice-PresidentMichael J. Ori, Second Vice-PresidentMichael J. Conway, TreasurerJennifer J. Howe, SecretaryMarjorie I. Sher, Immediate Past PresidentHon. Daniel B. ShanesDonald J. MorrisonCarey J. SchieverBrian J. LewisGary L. SchlesingerStephen .J Rice

Docket CommitteeMichael S. Strauss, Co-editorDaniel L. Jasica, Co-editorJeffrey A. BermanAnn Buche ConroyHon. Michael J. FuszDeborah L. GoldbergRachel C. He ymanHon. Charles D. JohnsonDaniel Sean Patrick LacyKevin K. McCormickHon. Raymond J. McKoskiTara H. OriTracy M. PoulakidasStephen J. RiceNeal A. SimonHon. James K. SimonianRebecca J. Whitcombe

StaffChristopher T. Boadt, Executive DirectorVirginia M. Elliott, Assistant Director

Meeting Minutes: May 16, 2013by Michael Ori24

‘Let Me Take This Opportunity…’by Chief Judge Fred Foreman5

In the Director’s Chair: Benefits of Membershipby Christopher T. Boadt2

View from the Bench23

2013-2014 Installation of Officers and Directors Dinner14

The President’s Page: Happy Lawyers Make for a Happy Court Systemby Steven McCollum3

The Perils of Briefing at the Trial Court Levelby Alex Zagor20

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Front1841317

22

Regulator’s Action Against LPL Financial Underscores Risks of Investing in Non-Traded REITsby James J. Eccleston

7

The Difficulty in Understanding and Applying Section 5/513(a)(1) of the IMDMAby Marc K. Schwartz and Staci Balbirer

11

Lake County Bar Golf Championship Details8

Recent Case Demonstrates Potential Perils for Subcontractors Underthe Mechanics Lien Actby Mark Van Doneselaar

16

LCBF: Participation Encouragedby Carlton R. Marcyan28


2 The Docket July 2013

In addition to being summer, it’s membership dues renewalseason. I wanted to take a few moments to highlight some ofthe benefits that come when you participate in the Lake

County Bar Association.

Featured on the back cover of the May issue of The Docket wasa personalized membership card. This membership card is validfor use at the businesses listed inside that issue on the “mem-bership discount pages.” Do you know a business that wouldbenefit from offering your fellow members an incentive/dis-count to lawyers, judges and other legal related professionals?Please feel free to share their contact information with me orhave them contact me directly at [email protected].

Continuing Legal EducationThe LCBA offers CLE programs representing many differentpractice areas throughout the year. At least 30 hours of locallyfocused and practice relevant programs are offered annually.Members attend CLE programs at a discounted tuition.

Lawyer Referral ServiceQualified members of the LCBA can join our lawyer referralservice, through which the LCBA sends referrals to your officebased upon specific case types you select. You may participate asa standard or premium member. Contact the LCBA (847-0244-3143) for more information.

Committee MembershipLCBA members may join (for free!) practice area committees.Participation in these committees allows members to networkwith others in their field and earn practice specific CLE.

The Docket&Weekly E-newsLCBA members are the first to know what’s going on in the LakeCounty legal community via our monthly magazine The Docketand the weekly e-newsletter.

Bar PollThe LCBA sends electronic surveys to LCBA attorney membersinquiring about the character and experience of judicial appli-cants and those seeking retention. The results of this processare shared with the Court’s Circuit Judges and are available tothe public.

Most importantly, THANK YOU FOR YOUR MEMBERSHIP.As always, please let me know if there is something you wouldlike us to explore to make your association the most relevant,useful, and best value bar.

To place an ad or for information onadvertising rates, call (847) 244-3143. Submission deadline: first dayof month preceding the month ofpublication. All submissions must bemade in electronic format (high reso-lution PDF or JPG format at a resolu-tion of 300 pixels per inch or more.)See www.lakebar.org/html/docke-tRates.asp.

The Docket is the official publication ofthe Lake County Bar Association, 300Grand Avenue, Suite A, Waukegan,Illinois 60085 (847) 244-3143, andis published monthly. Subscriptionsfor non-members are $45.00 per year.

Reproduction in whole or part with-out permission is prohibited. The opin-ions and positions stated in signedmaterial are those of the authors andnot necessarily those of the Associa-tion or its members.

All submitted manuscripts are consid-ered by the Editorial Board. All lettersto the editor and articles are subject toediting. Publications of advertise-ments is not to be considered as an en-dorsement of any product or serviceadvertised unless otherwise stated.

In theDirector’s Chair

byChristopher T. Boadt

Benefits of Membership

$1.75 per word (Rate for LCBA Members)$2.75 per word (Rate for Non-Members)$3.50 per word (Rate for LCBA Members)$4.50 per word (Rate for Non-Members)

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Classified Advertisement may contain as manywords, numbers, symbols and boldface type.

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July 2013 The Docket 3

ThePresident’s Page

bySteven McCollum

As I write this, I am in the middle ofa felony jury trial. For those of uswho do trial work, nothing is as

daunting and invigorating all at once as isfinally getting before a jury. Perhaps that isbecause nothing is so uncertain and car-ries the potential for total success or fail-ure, especially when the stakes are high.That being said, while doing a trial is prob-ably the most excitement you’ll ever haveas a lawyer, as a sole practitioner you arequickly faced with the knowledge thatnone of the many other things that needdoing can really be put aside either. Andfor me this column is one of those things.

I mention this in a lame attempt to get youto cut me some slack if this column doesnot contain any of those profound, self-evident truths that should be written in amonth celebrating our Declaration of In-dependence. Instead let me mention a fewslightly less profound but importantthings that are coming up, or have beenhappening with the court system andyour Board of Directors.

July 11th is the LCBA Golf Championship.This event, which, as always, promises tobe a great time, will be held at StonewallOrchard Golf Club. In speaking to theChair of the event, Michael Ori, I under-stand that there are still openings for par-ticipants and sponsors. If you want to getyour name or the name of your law firmout there, you can easily sponsor a hole orsome other aspect of the Championship.

Since I last wrote we’ve seen progress asour Circuit Clerk, Keith Brin, has quicklymade good on his promise to put the

court’s records online so we can all nowlook up our cases. Kudos to Keith. This hasalready been a great timesaver for my of-fice assistants and me, since it has obvi-ated the need to call the Clerk’s office forcase numbers, dates, and all the other in-formation we need several times every day.

I quickly realized other benefits of thischange when a prospective client calledme the other dayand I took the callon my cell phone.He couldn’t tell mewhat he wascharged with,whether it was afelony or misde-meanor, or whichcourtroom the casewas in, whichmeans he was a typ-ical prospectiveclient. So with theadvent of the newsystem, I put him onhold, looked up thecase on my iPhoneon the clerk’s web-site, and was able tothen talk to himwith some under-standing of whatwas going to be in-volved. Did I thankyou enough yetKeith? Welcome tothe 21st CenturyLake County.

In a recent meeting

of the Executive Justice Council there wasa discussion of the next step in the processof upgrading the Clerk’s record keepingsystem that will allow attorneys, with anannual fee, even greater access. This nextupgrade to the system should include theability to electronically file documents, re-view court pleadings and orders, andother access that will greatly enhance our

Happy Lawyers Make for aHappy Court System

Attorneys

WelcomeNew LCBA Members

Alfred Lee Johnson, Westra, Broker, Whittaker & Newitt, P.C.

David C. AdamsGrund & Leavitt P.C.

Laura M PrestoGrund & Leavitt P.C.

Ruth YaconaGrund & Leavitt P.C.

David I GrundGrund & Leavitt P.C.

Michelle RajferGrund & Leavitt P.C.

Ilene E. ShapiroGrund & Leavitt P.C.

Justin D. ScheidLaw Offices of Debra A.

Buetinger

Ryan M. JohnsonWarren Township

Rafael J. Guzman JrFerris, Thompson & Zweig, Ltd

Daniel BilskyBeermann & Ori Ltd.

Gary HollanderStrauss & Malk LLP

Jeffrey DovitzJutla & Dovitz, P.C.

AssociatesSarah Serdin

Fuqua, Winter & Stiles, LtdVictor Rigoni III

North Shore Capital Group


ability to represent our clients. I look for-ward to the day when we can file an ap-pearance, a notice, or a motion andperhaps set up a court date from our of-fices.

On the court security front, which contin-ues to be a subject that I’m often askedabout by other attorneys, I can only saythat the Sheriff has declared that he sup-ports an improved identification systemwhere attorneys can avoid the long linesat the magnetometers, as has Chief JudgeFred Foreman. I would like to think thathaving two of the most important playersconcerning this issue behind this idea willinevitably lead to a change we can em-brace. But I’ve been in Lake County toolong to be that naive.

The truth is that courthouse security isabout more than just court security. It in-volves the type of access and possible by-pass of security that will be allowed for thepeople who work in the entire building,not just the courts. It involves balancingthe need for security against the incon-venience to those of us who repeatedly goin and out of the courthouse. If there isone thing I’ve realized, it is that our in-

convenience will usually fail to overcomethe need for security. And perhaps weshould be okay with that and not forgetthat it is the lawyers who have often beenthe targets in other places when securityhas failed.

Months ago the LCBA Board of Directorsformed a committee to work on the court-house security issue and work with theJudges to improve the system. The Boardsupports a system in which the Bar Asso-ciation is involved in issuing identificationcards to lawyers who practice in ourcourts. Board Member Don Morrison isthe Chair of that committee. He and theother members of the committee havegathered information about the systems inplace in other areas. They are in theprocess of consulting with Chief JudgeForeman. Anyone who has constructivesuggestions should speak to Don.

For the Court system to work properly, thelawyers who work in that system need tofeel that the Courts are working withthem and responding to their concerns.The Clerk’s recent and upcoming changeswill certainly help the general public, butno one will benefit more than the lawyers

who will use the new access to therecords. My message is simple — happylawyers make for a happy, well-run courtsystem. Right now we have a Circuit Clerkwho is a lawyer who understands that, aSheriff who is a lawyer who understandsthat, and a Chief Judge who was a prac-ticing lawyer who understands that. Wehave an opportunity to work together andin the process make the system work bet-ter for everyone. The Bar Association mustbe a part of that.

As Independence Day draws near itshould be remembered that when thesigners of the Declaration of Independ-ence chose to put their fortunes and livesin jeopardy, one of the crimes of the Kinglisted in that Declaration was “for depriv-ing us in many cases, of the benefits ofTrial by Jury.” Without independentlawyers, free to represent our clients with-out interference, that right to a jury trialwould be meaningless.

And that gets me back to where I started,finishing my trial. Have a happy 4th ofJuly everyone — as lawyers, you’ve allearned it.



My job description as Chief Judgeincludes the responsibility forthe administration of the oath

of office for public officials and associationleaders. Also, on behalf of my colleagueson the bench, I extend congratulations fora job well done and recognize the achieve-ments of the members of our extended“Courthouse Family.”

The current conflict between the mediaand the Federal government regardingprivacy and “overreaching” governmentintrusions and our new experience with“Cameras in the Courts” caused me to re-flect on the passing of the Daily Herald’sTony Gordon on August 6, 2012. Tonycovered the courts for the Herald for 18years and was highly regarded for his fair-ness and accurate reporting of courtroomevents. Seldom was there drama or ani-mosity in his effort to report a story. Tonyalso wrote a column entitled “Crime andJustice” which concluded with a personalview of happenings in the courts entitled“Heard in the Hallways.” Tony and manyof our colleagues left us far too early intheir careers, but let us reflect upon theircontributions as we relate recent events“heard in the hallways.”

McCollum Installed as Bar PresidentSteven P. McCollum was installed as LCBAPresident on June 7, 2013, at the Deer-path Inn. The gala affair was kept onschedule by Master of CeremoniesRichard Kopsick and thank yous were ex-tended to Rick Lesser, Scott Gibson, andImmediate Past President Marjorie Sher,for their years of service. Good luck to CarlMarcyan as he takes over as President ofthe Lake County Bar Foundation.

Ben Ori Award to Mike SchostokState’s Attorney Mike Nerheim presentedthe Ben Ori Award to Michael Schostok forhis service as an Assistant State’s Attor-ney and his distinguished career in privatepractice. Justice Mary Schostok and familyaccepted the award on Mike’s behalf andjoined Ben’s son Mike and family in thecelebration of Ben Ori’s and MichaelSchostok’s achievements. They were gi-ants in our legal community who left usmuch too early in life.

Justice Schostok Elected Presidentof IJAAlso on June 7, Justice Mary Schostockwas elected by her peers as President ofthe Illinois JudgesAssociation for thenext year. FellowJudges and Boardmembers, Fore-man, Ortiz,Shanes, Waitesand Mullen werepresent in Chicagowith Mary and herfamily as JusticeRobert Thomas ad-ministered theoath. Sworn in onthe same day asBoard Members ofthe Illinois JudgesFoundation wereJudges Foreman,Bridges, Mullen,Ortiz andRochford.

Kudos to JudgesOrtiz, Ukena

And RochfordJudge Jorge Ortiz received the VanguardAward for access to justice and diversity,Judge Jay Ukena was reappointed to serveon the Child Support Committee for theState of Illinois and Judge ElizabethRochford was elected to the Board of Gov-ernors of the Illinois State Bar Associa-tion. Congratulations to all!

No Summer Vacations for Big ProjectsPublic access, E-Filing, and CriminalCourt’s Expansion move full speed aheadwith ground breaking for the new Crimi-nal Courts Building scheduled for laterthis summer. The Judiciary and Circuit


‘Let Me Take This Opportunity…’

TheChief Judge’s Page

byChief Judge Fred Foreman

THANKYOU!

To volunteer, please contact Susan Perlmanat [email protected] or 847-662-6925.

David Ganfield

Lori Berdenis

Burr Anderson

Deborah Goldberg

Howard Bernstein

John Julian

Adrienne Packard

Deena Rosenfeld

Paul Stanukinas

Ann Conroy

Thad Gruchot

Brian Wendt

The following attorneys have accepted Pro Bono cases through

Prairie State Legal Services.



Clerk Keith Brin plan enhancements toPublic Access, E-Filing, and an RFP for anew Case Management System this fall.

Waukegan Elects New MayorThe County and Judiciary look forward toworking with Mayor Wayne Motley, theAldermen, and his administration on thenew courthouse, as jobs, economic devel-opment, and excitement return to down-town Waukegan. I renew the samerequest to “Da Mare” as I did to MayorsSabonjian #1 and #2 – How about thosetrolley cars from the Lakefront and MetraStation to the Courthouse?

Lights, Action, Cameras!Live coverage of court proceedings startedin May as part of Lake County’s participa-tion in the Supreme Court’s ExtendedMedia Pilot Project. Thanks to Media Liai-

son Diane Flory and Media CoordinatorJennie Vana, we are “live” from downtownWaukegan.

Sheriff Shakes Up Security DetailSheriff Mark Curran recently appointedthe following Lake County Sheriff ’s OfficePersonnel to Court Security responsibility:John Byrne, Chief of Operations; JeffBurke, Lieutenant, Court Security; JeffLowery and Tim Jonites, Sergeants ofCourt Security; and, as members of theCourt Emergency Response Team (CERTTeam) Deputies Jon Triplett, Tom Sieber,Dave Sabourin and Brad Meister. Goodluck and thank you to Wayne Hunter onhis retirement and to Lt. Chris Thompson,now the supervisor of the afternoon shiftand “back on the road.” We all sleep betterat night (and some during the day) know-ing these guys are on duty.

Country Squire DemolishedOn a sad note, the Country Squire Restau-rant was torn down to make way for ex-pansion of the Lake Forest Hospital at thecorner of Routes 120 and 45. The Squirewas the site for many LCBA and politicalevents as well as the home of Wesley Searsand former Lake County State’s AttorneyBob Nelson. Owners Crystal and GusGovas have moved their hospitality andculinary skills to Bodega in Gurnee andhost the Jefferson Inn for dinner in lateJune.

Hats Off to Chris Boadt and VirginiaElliottWe all owe a debt of gratitude for all Chris,Virginia, Priscilla, and Hiram do for theLCBA, Judges, and Courthouse family.Your professionalism and service are firstclass!

Do you have a speaker idea or suggestion for our business meetings?

We would love to hear from you! Just send a note to: Chris Boadt ([email protected])



The Massachusetts Securities Divi-sion has filed a regulatory actionagainst LPL Financial, LLC (“LPL”),

seeking full restitution and other relief forinvestors residing in Massachusetts whowere sold non-traded real estate invest-ment trusts (REITs) in violation of Massa-

chusetts law.The regula-tory actionstands out be-cause it findsfault withsales of sev-eral non-traded-REITS,finding faultswith the en-tire productcategory. Thisa p p r o a c hc o n t r a s t swith efforts of

other regulators, such as FINRA’s regula-tory actions and sanctions imposed uponDavid Lerner Associates for its sale of justone non-traded REIT product, known asthe Apple REITs. Let’s examine the com-mon threads that bind the multiplicity ofnon-traded REITs products which Massa-chusetts securities regulators allege asbeing problematic.

Allegedly motivated by 6% commissions,LPL advisers sold the non-traded REITswithout, for example, providing a prospec-tus, as well as being in violation of partic-ular REIT requirements, Massachusettslaw, and LPL’s own internal complianceprocedures. Further, sales of non-tradedREITs were not suitable for investors inview of their investment objectives, risktolerance, income requirements and liq-uidity needs.

In particular, there were several generalfeatures applicable to all REITs (publiclytraded, non-exchange traded, and pri-vately traded) with which Massachusettssecurities regulators took issue. First,REITs “are often entirely illiquid.” Second,

REITs must distribute at least 90% of theirtaxable income, “however in instanceswhere income does not meet distributiondemand, REITs often resort to paying dis-tributions out of borrowed money.” Thoseand other features of REITs, the regula-tors conclude, make the products “awidely misunderstood investment vehi-cle.”

Non-traded REITs, the regulators allege,are more problematic still. They “are es-pecially risky through limited redemptionprograms, high fees and commissions,and internal conflicts of interest.” Com-missions and fees can range from 15% to18%. And regarding conflicts of interest,the regulators conclude, “At their core,non-traded REIT products operatethrough an immensely complex affiliatedand subsidiary structure rife with con-flict.”

Those shortcomings require “compre-hensive supervision and training,” yetwith that Massachusetts regulators con-clude that LPL was like “a boat with manyholes.” While “on paper,” LPL “set forthstringent requirements for the sale of non-traded REITs,” in practice LPL allegedlyfailed in its review of sales of the product.The prospectus requirement “was over-looked” numerous times. And the regula-tors’ complaint notes that the prospectusof many of the non-traded REITs con-tained a 10 percent concentration limita-tion (of net worth or liquid net worth).Likewise, certain non-traded REITs con-tained limitations with regard to incomerequirements. The regulator also pointsout that certain non-traded REITs con-tained even higher liquid net worth, networth and annual income requirementsfor Massachusetts residents.

Yet, the regulators conclude, LPL adviserswere “under-educated and under-super-vised” with respect to non-traded REITtransactions. The regulators noted thatLPL maintained on paper a document en-titled “LPL’s Alternative Investment Due

Diligence Process,” which purported to setforth a system of supervisory review andapproval. Additionally, LPL compliancemanuals provided specific requirementsand were accompanied by LPL’s writtensupervisory procedures. Yet the regulatorsconclude that, contrary to the LPL’sclaims, they were not followed.

The results of LPL’s deficiencies are as-tounding. Of the 597 transactions thatMassachusetts regulators reviewed, 569of those transactions violated prospectusrequirements, and 77 of those violatedconcentration requirements imposed byMassachusetts law. In short, 95% of thesales violated either prospectus require-ments or Massachusetts law!

The regulators focused their review on thefollowing non-traded REITs: Inland Amer-ican, Cole Credit Property Trust II, ColeCredit Property Trust III, Cole Credit Prop-erty 1031 Exchange, Wells Real Estate In-vestment Trust II, W.P. Carey CorporateProperty Associates 17, and DividendCapital Total Realty.

Investors must beware of non-tradedREITs. As the LPL decision demonstrates,they are alternative investments notworth the risk.

James J. Eccleston leads the Securities groupat the Chicago law firm of Shaheen, Novosel-sky, Staat, Filipowski & Eccleston, P.C.,where he represents investors in recoveringinvestment losses and financial services pro-fessionals in disciplinary, employment, andcompliance matters. He has held numeroussecurities licenses and Chicago Bar Associa-tion leadership positions and serves as an ar-bitrator and mediator. He is a recipient ofMartindale-Hubbell’s highest rating (AV) forlegal ability and ethics and is named to theIllinois Super Lawyer and Leading Lawyerlists. [email protected],312.621.4400, www.snsfe-law.com,www.financialcounsel.com.

Regulator’s Action Against LPL Financial Underscores Risks

of Investing in Non-Traded REITs

By

James J.Eccleston



Lake County Bar Golf ChampionshipThursday, July 11, 2013

Stonewall Orchard Golf Club25675 West Highway 60 • Grayslake, ILOver 100 lawyers and judges

18 –hole scramble • Pre-round luncheonPost-round reception & awards

EagleSponsor

$1,200

• Choice of starting hole (first paid-first served)• 4 players: green fees, cart and range balls• 4 Mulligans, 4 door prize entries• 12 drink tickets, pre-round luncheon and post-round reception• Tee sponsorship benefits, event banner recognition• Acknowledgement of sponsorship in August 2013 The Docket

TeeSponsor

$150

• The name of your firm, organization or company displayed on an individual sign at oneof the 18 tees (no logos on signs)

• Acknowledgement of sponsorship in playerwelcome packet

• Acknowledgement of sponsorship in August2013 The Docket

Player$175

• Greens fee, cart and range balls• Lunch, 2 beverage tickets and post play reception• 1 Mullgan and 1 door prize ticket• Raffle prizes and tournament contest

ClubhouseSponsor

Gold Tee: $1,000

Silver Tee: $500

Silver Tee:• The name of your firm, organization or company displayed on an individual sign at one of the 18tees. (Logos permitted, provide JPG file)

• Firm, organization or company prominently displayed throughout the championship• 2 tickets to the: pre-round luncheon, post-round reception, 2 drink tickets per person• 2 representatives permitted at sponsored hole• Acknowledgement of sponsorship in player welcome packet• Acknowledgement of sponsorship in August 2013 The Docket

Gold Tee:• All of the above, plus naming rights to one of the following: (Please check)o Luncheon o Reception o Beverage Cart oHole-In-One

Soar like an EaglePremium

starting position

Premium publicity

A portion of the proceeds will benefit PADS Lake County

NEW THIS YEAR



Stonewall Orchard Golf Club was designed by renowned golf course architectArthur Hills. He has incorporated the natural rolling landscape of Lake County to dictate this magnificent 18-hole 7,124-yard, par 72 championship layout, each hole provides its own identity and challenge to golfers of all skill levels.

Name: __________________________________________ Firm: ____________________________________________

Display Acknowledgement as: _________________________________________________________________________(How the sponsor’s name will appear)

Address: ________________________________________ City, State & Zip: ___________________________________

Phone: _________________________________________ Fax: _____________________________________________

E-mail: ____________________________________________________________________________________________

Payment method: o Check enclosed o Visa oMastercard o Discover oAmerican Express

Number: ________________________________________ Expiration Date: ____/____/____ CVV2: ______________

Signature: _________________________________________________________________________________________PLEASE RETURN REGISTRATION TO:

Lake County Bar Association • 300 Grand Avenue, Ste A • Waukegan, IL 60085TEL (847) 244-3143 • FAX (847) 244-8259

Golf & Sponsor RegistrationMY FOURSOME:

1.________________________________________HDCP

2.________________________________________HDCP

3.________________________________________HDCP

4.________________________________________HDCP

Please try and place me with:

Name: _________________________

o Individual Player: # ____ @ $175(includes golf, lunch & reception)

o Lunch & 1 Drink Ticket: # ____ @ $25

o Reception & 1 Drink Ticket: # ____ @ $25

o Eagle Sponsor (includes 4 players) $1,200

Clubhouse Sponsor

o Gold Tee $1,000

o Silver Tee $500

oTee Sponsor $150

Total $ __________

Sponsorship opportunities are availabe on a first paid, first serve basis. Sponsors will be recongized with signage at the event and a thankyou ad in The Docket.

Cont act Information

Lake County Bar Golf ChampionshipThursday, July 11, 2013

Stonewall Orchard Golf Club25675 West Highway 60 • Grayslake, IL



When attempting to calculatesupport for a disabled child,looking for guidance under the

statute will leave you asking questions.This article will simplify how to calculatesupport and the options available to your

client.

Section 750ILCS 5/513 ofthe IllinoisMarriage andDissolution ofMarriage Actis entitled,“Support forNon -M ino rChildren andEducationalE xp en s e s . ”Although thetitle of Section513 mayseem clear,the needs ofthe childrenreceiving con-tinuing Sec-tion 513support couldnot be mored i f f e r e n t .When repre-senting aclient withchildren, Sec-t i o n

513(a)(2) is often referenced as it setsforth guidelines to determine each par-ent’s respective contribution to a child’seducational expenses. The recipient ofcontinuing support under Section513(a)(2) is a child who has the aptitudeto attend a higher level education institu-tion with the ultimate goal of becomingindependent from his parents.

Alternatively, Section 513(a)(1) refer-ences an individual who, upon reachingthe age of majority, is mentally or physi-cally disabled and not otherwise emanci-pated. In most cases this is an individualwho, unlike his 513(a)(2) counterpart, re-quires continuing support as he will neverbecome entirely independent.

The clear focus of Section 513 is educa-tional expenses. Section 513(a)(2) detailsthe “educational expenses” which may beincluded and also sets forth relevant fac-tors in determining the Court’s allocationof educational expenses between parties.While the statute may be straightforward,explaining to your client the reasons hemay be responsible for educational ex-penses can pose a challenge.

Although Section 513(a)(2) is clear, its(a)(1) corollary is not.

Section 513(a)(1) states in relevant partthat:

(a) The court may award sums ofmoney out of the property and in-come of either or both parties… forthe support of the child or children ofthe parties who have attained major-ity in the following instances: (1)When the child is mentally or physi-cally disabled and not otherwiseemancipated, an application for sup-port may be made before or after thechild has attained majority.

Section 513(a)(1) does not explain theprecise calculation of support, its uses, orthe length of time support continues. Theambiguity of 513(a)(1) leaves attorneysand their clients with many unansweredquestions: How is support for an adult dis-abled child calculated? What expensesshould be paid with the continuing sup-port received? Is Supplemental Security

Income (SSI) taken into considerationwhen determining an adult disabledchild’s expenses? What if expenses in-crease - is support modifiable? How doesthe judge usually rule in these types ofcases? With so many unanswered ques-tions, it is best to start at the beginning toexplain Section 513(a)(1) to a client.

If a child is disabled prior to reaching theage of majority and a parent is seekingcontinuing support, a disability findingmust be made by a Domestic RelationsCourt. Even if an individual has been ad-judicated disabled in Probate Court, this isinsufficient because an individual couldbe disabled within the meaning of theProbate Act and not be disabled withinthe meaning of section 513. In constru-ing section 513, the courts have used dic-tionary definitions of disabled which, incontrast to the Probate Act’s definition,concern the inability to manage one’s af-fairs.1 Webster’s Third New InternationalDictionary defines, “disabled” as incapaci-tated by or as if by illness, injury orwounds.2 The Probate Act defines “dis-abled person” as “a person 18 years orolder who (a) because of mental deterio-ration or physical incapacity is not fullyable to manage his person or estate, or (b)is a person with mental illness or a personwith a developmental disability and whobecause of his mental illness or develop-mental disability is not fully able to man-age his person or estate, or (c) because ofgambling, idleness, debauchery or exces-sive use of intoxicants or drugs, so spendsor wastes his estate as to expose himself orhis family to want or suffering.”3

A Petition for Disability Finding can bebrought before the Court in both pre-de-cree and post-decree matters. If your caseconcerns an individual who has alreadyreached the age of majority, it is both cost-

The Difficulty in Understandingand Applying Section

5/513(a)(1) of the IMDMA

By

Staci Balbirer

By

Marc K.Schwartz

1 In re the Marriage of Lerner, 316 Ill. App. 3d 1072, 1077, 738 N.E. 2d 183, 187 (1st Dist. 2000). 2 In re the Marriage of Thurmond, 306, Ill. App. 3d 828, 832, 715 N.E. 2d 814, 816 (2nd Dist. 1999).3 In re the Marriage of Lerner, 316 Ill. App. 3d 1072, 1077, 738 N.E. 2d 183, 187 (1st Dist. 2000).



effective and time efficient to include anapplication for continuing support in yourinitial Petition. It is important to note thatsupport can be awarded retroactively tothe filing of your Petition, so time is of theessence. In post-decree litigation, the par-ties’ Judgment for Dissolution of Marriagemay contain language regarding an indi-vidual’s disability and a Petition for Dis-ability Finding may not be necessary. Still,the failure of such a finding in the under-lying judgment does not preclude a postdecree petition seeking a finding.

When the Court finds an individual to bedisabled, the Court has discretion to ordercontinuing support pursuant to section513(a)(1). Though there is a plethora ofcase law regarding a parent’s obligation toprovide continuing support for a disabledindividual after he reaches the age of ma-jority, there is no case law that dictates thecalculation of child support using the Illi-nois statutory guidelines as set forth in

Section 505(a)(1) of the IMDMA, or basedon the child’s needs.

A “needs based approach” can be calcu-lated utilizing the following factors as setforth in Section 505(a)(2):

a) the financial resources of the child;b) the financial resources and needsof the custodial parent; c) the stan-dard of living the child would haveenjoyed had the marriage not beendissolved; d) the physical and emo-tional condition of the child, and hiseducation needs; and e) the financialresources and needs of the non-cus-todial parent.

As disabled individuals may have special-ized needs, calculating support using theIllinois statutory guidelines may not be inthe best interest of the child. Utilizing a“needs based” approach, the Court will beable to review the individual’s specific

monthly needs and calculate a more ac-curate support amount.

When representing either the custodial ornon-custodial parent of an adult disabledchild, the arguments for appropriate ex-penses and each party’s contribution willvary significantly. For a custodial parent,in addition to the cost of the individual’sspecific needs, there are expenses such asmortgage payments, groceries, electricity,etc. Should the individual’s portion ofthese additional expenses be included in aneeds-based support calculation? Thenon-custodial parent will certainly argueagainst supplementing the custodial par-ent’s mortgage payments and electricitybills as arguably those are expenses thatthe custodial parent would incur regard-less of the individual residing with them.However, because needs-based support isdiscretionary, being prepared to argue theinclusion of additional expenses mayprove successful in some cases and before

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some judges.

Although you will be hard pressed to findtwo judges who calculate Section 513support in an identical manner, the Courtshould always consider the financial re-sources of the individual, specifically,whether or not a disabled child receivesSupplemental Security Income (SSI). SSIprovides funds for basic needs such asfood, clothing, and shelter, so SSI receivedshould be subtracted from the totalmonthly expenses of the individual. Asimple example: if it is determined that anadult disabled child’s needs-based ex-penses are $2,000 a month and said indi-vidual receives $694 in SSI, the totalmonthly expenses to be allocated betweenthe parties is $1,306. If the individual re-ceives any additional benefits, dependingon the party you represent, you should beprepared to argue about the benefits to beincluded in calculating the child’s ex-penses and each parent’s respective sup-port contribution.

Illinois courts have also held that Section513 expenses are a form of child supportto be read in conjunction with Section505 and Section 510, and thus are modi-fiable.4 Therefore, each parent’s contribu-tion to a disabled individual’s expensescan be modified upon a substantialchange in circumstance. This also meansthat the Court may interpret Section513(a)(1) pursuant to statutory guide-lines as set forth in Section 505(a) and nota needs-based analysis as discussed above.If the Court utilizes a statutory approach,the non-custodial parent may be orderedto pay 20 percent of his monthly net in-come for a child with special needs. If thisfamily has more than one child with spe-cial needs, the percentage of the support-

ing party’s net income to be paid will in-crease based on the number of specialneeds children. However, similar to childsupport under Section 505, practitionerswill be hard-pressed to find case law thatstates when a needs-based analysis shouldbe utilized versus statutory guidelines.This results in the Court having ultimatediscretion.

Regardless of whether statutory guidelinesor a needs-based analysis is utilized, thecontribution of each parent to the individ-ual’s monthly expenses will be determinedby the court or by agreement. Again, in ap-plying a needs-based analysis, the courtwill review the financial resources of bothparties, the financial resources of thechild, the standard of living the childwould have enjoyed had the marriage notbeen dissolved, the physical and emotionalcondition of the child, and his educationalneeds. As each case is fact specific, eachoutcome will differ. Alternatively, in apply-ing statutory guidelines, a non-custodialparent shall pay a set percentage of hismonthly net income based on the numberof disabled children he was ordered to sup-port. This approach is less fact specific andmore in accordance with the idea of con-tinuing child support.

In rare instances, you may represent aclient with an adult disabled child whocan be classified under both Sections513(a)(1) and (a)(2). Issues arise whenthe non-custodial parent, who has beenordered to contribute to college, has alsobeen making payments for the individualpursuant to Section 513(a)(1). Should thepayments made pursuant to Section513(a)(1) be included when calculatingthe total amount of college expenses paidby the non-custodial parent? Should a dis-

abled child be entitled to receive benefitsunder both Sections 513(a)(1) and (a)(2)?These questions remain unanswered ascase law and Section 513 are silent as to adisabled individual who attends a higherlevel educational institution.

Although case law is very clear that adultdisabled children are entitled to continu-ing support, Section 513(a)(1) does notprovide answers to important questions.When you represent a client with an adultdisabled child, it is important to recognizethe day-to-day challenges in caring andproviding for an adult disabled child. It isalso important to understand and cor-rectly apply Section 513(a)(1) as the out-come of a Section 513 support hearingshould ultimately result in a ruling that isin the best interest of the child.

Marc K. Schwartz ([email protected]) and Staci Balbirer([email protected]), of the lawfirm Schwartz Wolf & Bernstein LLP, con-centrate their practice in the area of domesticrelations and family law and have a specialfocus in assisting families who have childrenwith special needs.

Staci Balbirer is an associate with SchwartzWolf & Bernstein LLP. She concentrates herpractice in the area of domestic relations andfamily law and has a special focus on assistingfamilies who have children with special needs.Ms. Balbirer received her BA from LehighUniversity in 2006 and her Juris Doctor fromThe John Marshall Law School in 2009.

4 In re the Marriage of Petersen, 955 N.E. 2d 1131, 1134 (2011).



2013-2014Installation of Officers and Dir

Friday, June 7, 2013 • Deerpath Inn •



Directors Dinner • Lake Forest, IL



Imagine the frustration of having a setof strict statutory requirements for acause of action, meeting those strict

requirements, but still failing in the un-derlying cause of action. Such a frustrat-ing result is entirely possible under the

provisions ofthe Mechan-ics Lien Act1

(the Act) andthe case lawinterpretingthe Act. Therecent SecondDistrict Appel-late Courtopinion inDoors Acquisi-tion, LLC v.R o c k f o r dS t r u c t u r e s

Construction Company2 provides a classicexample of how a mechanics lienclaimant can fully comply with the provi-sions of the Act but still have its mechan-ics lien foreclosure action fall short. Thisarticle will examine the holding in DoorsAcquisition and provide advice for practi-tioners and mechanics lien claimantsseeking to avoid the unfortunate result ofDoors Acquisition.

Before examining the holding in Doors Ac-quisition, it is worthwhile to briefly exam-ine what the Act requires for asubcontractor to perfect its mechanicslien rights. To be entitled to a mechanicslien, a subcontractor (1) must have a validcontract; (2) the contract must be with aparty considered to be an original con-tractor under the Act; (3) the contractmust be for the purpose of furnishing lien-

able materials or services; and (4) the sub-contractor must substantially perform thecontract or have a valid excuse for non-performance.3

Meeting the first four prerequisites simplyentitles a subcontractor to mechanics lienrights. To perfect those rights a subcon-tractor must send notice of its lien in ac-cordance with section 24 of the Act.4

Notice may be sent any time after the par-ties enter into a contract to perform workand must be sent within 90 days of thelast day that work is performed.5 Perfec-tion of the lien also requires that the ac-tual lien claim be recorded within fourmonths of last performing work. Therecorded lien claim must be verified by af-fidavit of the claimant, contain a briefstatement of the claimant’s contract, setforth the balance due, and provide a suffi-ciently correct description of the real es-tate involved.6 As an alternative torecording the claim for lien, a lienclaimant may also bring an action to en-force its lien within four months of lastperforming work.7

With an understanding of what a sub-contractor must do to perfect its mechan-ics lien rights, we can venture into thefacts of Doors Acquisition. The facts are notcomplicated. Norman J. Weitzel and Rock-ford Structures Construction Companyentered into a contract for the construc-tion of a hotel. Rockford Structures wasthe general contractor for the project.Rockford Structures contracted with D&PChicago, Inc. to supply, install, and finishthe drywall for the project. D&P employedmembers of District Counsel No. 30 of theInternational Union of Painters and Al-

lied Trades, AFL-CIO (the Union) to per-form work under D&P’s contract withRockford Structures.

In November of 2007, Rockford Struc-tures terminated D&P. At the time D&Pwas terminated, D & P owed the Union$6,591.30 for wages and $17,003.98 forbenefits. The unpaid wages and benefitswere for work performed from August2007 through November 9, 2007. On Jan-uary 10, 2008, Rockford Structures pro-vided a sworn statement to Weitzel statingthat D&P had been paid in full for the workthat it performed and that D&P’s work onthe project was complete. On March 6,2008, the Union filed its mechanics lien inthe amount of $23,595.28.

The lien was served on Weitzel, RockfordStructures, and D&P. When notice of thelien was received by Weitzel, he was un-aware that D&P had failed to pay theUnion for its wages and benefits. The opin-ion does not say when Weitzel receivednotice of the lien. We are left to assumethat the notice was sent within 90 days ofNovember 9, 2007, because if it was sentany later than that, the lien would havebeen defective for failing to comply withsection 24 of the Act.

The circuit court ruled that the Union hada valid lien and ordered Weitzel to pay theUnion or the sheriff would execute a judg-ment of foreclosure. The order includedfinal and appealable language, andWeitzel appealed.

The only issue on appeal was whether thelien was valid. Weitzel argued that the lienwas invalid because the Union could onlyrecover the amount owed to its immediate

Recent Case Demonstrates Potential Perils for SubcontractorsUnder the Mechanics Lien Act

ByMark

Van Doneselaar

1 770 ILCS 60/1 et seq. 2 2013 IL App (2d) 1200523 J&K Cement Const., Inc. v. Montalbano Builders, Inc., 119 Ill.App.3d 663, 678 (2d Dist. 1983).4 770 ILCS 60/245 Id.6 770 ILCS 60/7; Tefco Const. Co. v. Continental Comm. Bank & Trust Co., 357 Ill.App.3d 714, 719 (1st Dist. 2005). 7 770 ILCS 60/7



contractor, D&P, and that D&P had beenpaid in full when he received notice of theUnion’s lien. The Union argued that itslien was valid because, when Weitzel re-ceived notice of the Union’s lien, Weitzelowed Rockford Structures money for workperformed.

The appellate court began its analysis byexamining sections 5, 21, 24, and 27 ofthe Act. Section 5 of the Act8 providesthat prior to any funds being paid to a gen-eral contractor, the general contractorshall provide the owner with a swornstatement of the names and addresses ofall subcontractors involved in the projectand the amount due or to become dueeach. Section 219 provides that subcon-tractors shall have a lien for the value ofthe services that they provide to the proj-ect and on the funds due or to become duefrom the owner under the original con-tract. Section 2410 provides that at any

time after starting work on the project andwithin 90 days of completing its work,subcontractors must send notice of theirclaim for lien. Such notice must be sent tothe owner and any lender with an inter-est in the property being improved.11 Fi-nally, section 2712 provides that when anowner has notice of a subcontractor’s lienclaim, he shall retain sufficient funds dueor to become due to the contractor to paythe demands of the subcontractor.

The appellate court then looked toWeather-Tite, Inc. v. University of St. Fran-cis, 233 Ill. 2d 385 (2009) for an exampleof how the foregoing provisions of the Actwork in every day practice. In Weather-Titethe defendant, a university, hired a gen-eral contractor to renovate a residencehall. The general contractor hired a sub-contractor, Excel, to perform electricalwork. On five occasions the general con-tractor requested a payment from the

owner and submitted a sworn statementpursuant to section 5 of the Act with eachrequest. Each sworn statement to theowner listed Excel and the amount due toExcel. After receiving the first four re-quests, the university paid the generalcontractor the full amount owed it, in-cluding the amount owed to Excel. Thegeneral contractor paid Excel. However,the fifth pay request didn’t go as smoothlyas the first four requests. The universitypaid the general contractor, but the gen-eral contractor’s bank applied part of thepayment received to a debt that it wasowed. As a result, Excel was not paid outof the fifth payment that the general con-tractor received.

Excel filed its mechanics lien, and thesupreme court concluded that it was enti-tled to its lien. The supreme court foundthat the purpose of the sworn statementrequired by section 5 of the Act was to put

8 770 ILCS 60/59 770 ILCS 60/21 10 770 ILCS 60/2411 Petroline Co. v. Advanced Environmental Contractors, Inc., 305 Ill.App.3d 234, 238 (1st Dist. 1999).12 770 ILCS 60/27.



an owner on notice of a subcontractor’sclaim, and section 27 created a duty uponthe owner to pay the claim of subcontrac-tors named in the sworn statement. Thus,the university could not pay the generalcontractor and rely upon the general con-tractor to properly disburse the funds to itssubcontractors without running the riskof being subject to a lien of a subcontrac-tor who was not paid. Excel’s lien wasfound validly perfected.

The appellate court also examined theholding in Bricks, Inc. v. C&F Developers,Inc., 361 Ill. App. 3d 157 (1st Dist. 2005).In Bricks a material supplier for a subcon-tractor was not paid by the subcontractorand asserted a lien for the balance owed.The sworn statement that the generalcontractor provided to the owner did notlist the material supplier and listed thesubcontractor as being owed an amountmuch less than was owed to the materialsupplier. The material supplier did all thatwas required of it to perfect its mechanics

lien rights. The court in Bricks found thatthe purpose of the Act is not only to pro-tect the rights of those furnishing materi-als and labor to a project but also toprotect owners from potential claims. Thecourt was forced to rule between a lienclaimant who had done all that was re-quired to perfect its lien claim and anowner who had unknowingly been pro-vided with incomplete sworn statementsand had relied upon them. The courtruled in favor of the owner and limited thematerial supplier’s lien to the extent owedthe subcontractor – an amount less thanwas actually due the material supplier.

The Union relied upon A.Y. McDonaldManufacturing Co. v. State Farm Mutual Au-tomobile Insurance Co.13 and Struebing Con-struction Co. v. Golub-Lake Shore PlaceCorp.14 in support of the validity of its lien.However, the court found the facts of bothcases to be distinguishable. In A.Y. Mc-Donald, the owner admitted that it had notobtained a sworn statement pursuant to

section 5 of the Act. That fact was an im-portant distinction from the facts in DoorsAcquisitionwhere the owner had obtaineda sworn statement and it showed the lienclaimant’s immediate contractors to havebeen paid in full. In Struebing the lienclaimant was not listed on the swornstatement provided to the owner. How-ever, the owner still had notice of the lienclaimant’s involvement in the project.Again, this was a distinguishing fact fromDoors Acquisitionwhere the owner has notaware of the Union’s role in the projectuntil receiving notice of its lien.

Ultimately, the appellate court in Doors Ac-quisition found the reasoning in Bricks tobe persuasive. The court found that theAct seeks to strike a balance between therights of owners, contractors and sub-contractors. The Court found that oneway an owner’s rights are protected is byallowing owners to rely upon sworn state-ments provided to them pursuant to sec-tion 5 of the Act. Thus, the balance will

13 225 Ill.App.3d 851 (4th Dist. 1992)14 281 Ill.App.3d 68 (1st Dist. 1996)



be struck in favor of an owner who hasproperly received a sworn statement overan equally deserving subcontractor whohas not been paid in full.

With the harsh result of Doors Acquisitionin mind, we turn to what subcontractorscan do to avoid such perils. The solution canbe summarized in two words – provide no-tice. After an owner has received notice of asubcontractor’s involvement in the project,the owner must retain sufficient funds topay what is due the subcontractor. As stated

above, section 24 of the Act allows a sub-contractor to provide notice to the owner oftheir claim any time after making the con-tract with the general contractor. Whilesection 24 allows notice to be sent up to 90days after the completion of the work, it canalso be sent much sooner. In practice, mostsubcontractors don’t even think about pro-viding notice of their lien until the projectis complete. By waiting until the limits oftime allowed by section 24 nears, interven-ing factors such as those present in DoorsAcquisition can be fatal to a subcontractor’s

claim. The far safer practice is for subcon-tractors to provide owners with notice oftheir involvement and role in the projectearly on in the construction project.

Mark A. Van Donselaar is a partner atChurchill, Quinn, Richtman & Hamilton, Ltd.in Grayslake, Illinois. His practice is concen-trated in the area of commercial litigation witha focus on construction and real estate litiga-tion including mechanics lien claims, title in-surance disputes and general constructionlitigation. Mark can be contacted at [email protected].



Navigating the various rules thatgovern the practice of law can be adifficult undertaking. Some of

those rules are self-explanatory, like theprohibition on attorneys engaging in “dis-honesty, fraud, deceit, or misrepresenta-

t i o n . ” 1

However, therules thatconcern thesubstance ofan attorney’swritten argu-ments and theuse of legalauthorities incourt briefsare an alto-gether differ-ent matter.These canpresent a host

of unseen snares that can trip up evenhighly experienced lawyers if they aren’tcareful.

Since an attorney’s “reputation for in-tegrity, thoroughness and competence ishis or her bread and butter,”2 many as-sume the practice of mischaracterizinglegal authority in court briefs is only at-tributable to inexperienced attorneys orunscrupulous writers. Earlier this year,that assumption was categorically de-bunked by several attorneys involved inthe case of Thul v. OneWest Bank, FSB.3This article is about the larger lessons thatcan be learned from the court’s responseto those attorneys’ arguments. At the very

least, the court’s two written opinions onthe topic demonstrate there are multiplereasons for attorneys to take extra carewhen briefing legal issues at the trial courtlevel.

A Cautionary TaleBack in January, a post appeared on a pop-ular legal blog about three accomplishedlitigators who landed in hot water after fil-ing a motion to dismiss in the U.S. DistrictCourt for the Northern District of Illinois.4

The presiding judge in Thul addressed thematter by issuing a detailed memoran-dum opinion and order denying the re-quest for dismissal, directing the attorneyswho signed the motion (two partners fromWashington, D.C. and their associate inChicago) to show cause in writing whythey should not be sanctioned by thecourt, and requiring all of them to appearin person for a hearing on the matter.5

The court’s stern reaction was based onits finding that the attorneys’ core argu-ment for dismissal “fl[ew] in the face of arecent and controlling Seventh Circuit de-cision that [the attorneys] did not botherto address or even mention until after the[plaintiffs] cited it in their response to themotion to dismiss.”6 In addition, the courtnoted the attorneys’ failure to discuss thatSeventh Circuit decision in their openingbrief “likely amounted to conduct sanc-tionable under Federal Rule of Civil Pro-cedure 11(b)(2) and 28 U.S.C. § 1927,”and “almost certainly ran afoul of theirobligation of candor” under Rule3.3(a)(2) of the ABA Model Rules, as well

as the corresponding rules in Illinois andthe District of Columbia.7

Applicable Rules in Illinois StateCourt ProceedingsThe Thul court’s reference to Illinois rulesserves as a valuable reminder of the factthat practitioners can find themselves insimilar situations when briefing questionsof Illinois state law. Much like their federalcounterparts, Illinois courts view attor-neys as “part of the machinery of law forthe administration of justice” and there-fore “rely upon their good faith and hon-esty.”8 For that reason, the IllinoisSupreme Court has long cautioned that“[a]n attorney’s zeal to serve his clientshould never be carried to the extent ofcausing him to seek to accomplish hispurpose by a disregard of the authority ofthe court or by seeking to secure from acourt an order or judgment without a fulland frank disclosure of all matters andfacts which the court ought to know.”9

In accordance with these views, Rule3.3(a) of the Illinois Rules of ProfessionalConduct specifically prohibits attorneysfrom knowingly making or failing to cor-rect “a false statement of fact or law to atribunal,” or failing to disclose “legal au-thority in the controlling jurisdictionknown to the lawyer to be directly adverseto the position of the client and not dis-closed by opposing counsel.”10This meansthat any “[l]egal argument based on aknowingly false representation of lawconstitutes dishonesty toward the tribu-nal.”11 Attorneys must therefore walk a

The Perils of Briefingat the Trial Court Level

By

AlexZagor

1 See Ill. R. Prof. Cond. 8.4(c) (West 2010).2 FDIC v. Tekfen Construction and Installation Co., Inc., 847 F.2d 440, 444 (7th Cir. 1988).3 Thul v. OneWest Bank, FSB, No. 12 C 6380, 2013 WL 24599 (N.D. Ill. Jan. 2, 2013).4 See David Lat, Benchslap of the Day: Skadden, Smacked, Eats Crow, Above The Law, Jan. 15, 2013, http://abovethelaw.com/2013/01/benchslap-of-the-day-skad-den-smacked-eats-crow/ (providing the full text of the court’s order to show cause as well as counsels’ response to the court’s order with added commentary). 5 Thul, supra at *3, n.4.6 Id. at *2. 7 Id. 8 In re Alschuler, 388 Ill. 492, 503 (1944).9 People ex rel. Fahey v. Burr, 316 Ill. 166, 182 (1925).10 Ill. R. Prof. Cond. 3.3(a)(1)-(2) (West 2010).11 Id., cmt. 4.



narrow path in order to comply with theirethical obligations to a court while argu-ing the merits of their clients’ cases.12

In contrast to the rules regarding state-ments of law or fact to a tribunal, whichare controlled by the Illinois Rules of Pro-fessional Conduct, sanctions for impropercourt filings in Illinois state court are gov-erned by Illinois Supreme Court Rule 137,which is almost identical to Rule 11 of theFederal Rules of Civil Procedure.13 Rule137 sanctions can be granted if a plead-ing, motion, or other paper is not “wellgrounded in fact” or is not “warranted byexisting law or a good-faith argument forthe extension, modification, or reversal ofexisting law.” Under this standard, “[a]paper filed in the best of faith, by a lawyerconvinced of the justice of his client’scause, is sanctionable if counsel neglectedto make ‘reasonable inquiry’ before-

hand.”14 In other words, an “empty headbut a pure heart”15 is no defense to Rule137 sanctions for making an objectivelymeritless legal argument that flies directlyin the face of a controlling authority.

At the trial court level, attorneys can getinto trouble if their briefs only argue oneIllinois appellate court district’s positionon an issue without taking the time to ad-dress contrary positions from other dis-tricts. To avoid these kinds of problems, itis imperative for attorneys to take the Illi-nois rules of stare decisis into considera-tion when researching case law. First andforemost, these rules state that “a circuitcourt must follow the precedent of the ap-pellate court of its district, if such prece-dent exists; if no such precedent exists, thecircuit court must follow the precedent ofother districts.”16 At the same time, “theopinion of one district, division, or panel

of the appellate court is not binding onother districts, divisions, or panels,”17 andonly the Illinois Supreme Court can abro-gate, overrule, or reverse the decision ofan Illinois Appellate Court.18 Attorneyswho keep all of these rules in mind whileaggressively shepardizing the cases theyplan to cite in their briefs should be able tosafely and credibly argue their side of alegal issue without fear of inadvertentlywandering into the crosshairs of Rule137.

Consequences in the CourtroomOverall, the federal rules and their Illinoisanalogs seem to operate in the same waywhen applied to written arguments thatfail to disclose a relevant legal authority toa court. However, the severity of a court’sresponse to those sorts of arguments ap-pears to be largely fact-driven. As one Illi-nois appellate panel has observed,

12 See Robert T. Park, Rule 3.3 and Honesty in Litigation New Rule 3.3 Makes the Point More Economically Than Before - Don’t Make or Fail to Correct A False Statement,Don’t Offer False Evidence, and Don’t Fail to Disclose Adverse Legal Authority, 98 Ill. B.J. 272, 273 (2010).13 See People v. Stefanski, 377 Ill.App.3d 548, 551 (2nd Dist. 2007).14 Id. at 551-52 (quoting Mars Steel Corp. v. Continental Bank N.A., 880 F.2d 928, 931-32 (7th Cir. 1989)).15 Chambers v. American Trans Air, Inc., 17 F.3d 998, 1006-07 (7th Cir. 1994).16 Schramer v. Tiger Athletic Ass’n of Aurora, 351 Ill.App.3d 1016, 1020 (2nd Dist. 2004). 17 O’Casek v. Children’s Home & Aid Soc. of Ill., 229 Ill.2d 421, 440 (2008).18 See Gillen v. State Farm Mut. Auto Ins. Co., 215 Ill.2d 381, 392 n.2 (2005) (noting one division of the First District appellate court’s attempt to abrogate a prior

LAWYER REFERRAL SERVICEWhy should YOU join the LCBA Lawyer Referral Service?

The LCBA Lawyer Referral Service (LRS) is a valuable member benefit as well as a public service. LRS providesmember attorneys with an opportunity to build business through client referrals. The service benefits thepublic by helping callers quickly find an attorney in the area of law in which they need help. The LRS iswidely publicized and all LCBA members in good standing who carry the required malpractice insuranceare eligible to join.

The LRS program is designed to assist persons who are able to pay normal attorney fees but whose ability tolocate legal representation is frustrated by a lack of experience with the legal system, a lack of informationabout the type of services needed, or a fear of the potential costs of seeing a lawyer.

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“[w]hen imposing sanctions, a court hasseveral options, including ‘a warmfriendly discussion on the record, a hard-nosed reprimand in open court, compul-sory legal education, monetary sanctions,or other measures appropriate to the cir-cumstances.’”19

For instance, in dealing with the motionto dismiss filed in Thul v. OneWest Bank,FSB, the U.S. District Court ultimately de-clined to award monetary sanctions.20 In-stead, the court began its secondmemorandum opinion and order on thematter by vacating the previous order toshow cause with respect to one attorney(the Chicago associate) in light of the factthat the two more senior attorneys tookfull responsibility for their briefs’ con-tents.21 The court also took note of the at-torneys’ sincere apology for failing tobring controlling case law to both thecourt’s and opposing counsels’ atten-tion.22

While the court acknowledged the attor-neys’ position on the matter (i.e. that theSeventh Circuit case in question did notneed to be cited because it was distin-guishable from their case), it was unper-suaded by the attorneys’ reasoning andfound “no appreciable difference betweenthe argument that the Seventh Circuit re-jected …and the argument that the attor-neys for [the defendant] made here.”23

Since the attorneys were “aware” of thecase “and because it was ‘directly adverseto the position of the[ir] client’ Ill. RPC3.3(a)(2), they should have cited it. Thefact that they cited…both older SeventhCircuit cases and non-binding precedentfrom trial courts, underscores the inap-propriateness of their failure to cite [con-trolling Seventh Circuit precedent].”24

The court concluded its order by findingthat no further sanctions were necessaryin view of (i) the attorneys’ earnest showof contrition in response to the court’sprior order, (ii) the attorneys’ financialcontribution to the settlement of the un-derlying litigation, and (iii) the fact thatthe court’s two written opinions and oraladmonitions on the issue of sanctionswere now matters of public record whichidentified the attorneys by name.25 Indoing so, the court noted that it fully un-derstood “the impact that a finding ofmisconduct can have upon an attorneyeven without the imposition of additionalsanction,” and that it trusted that the at-torneys identified in the opinion “will bemore cautious in the future.”26

Lessons LearnedThough the presiding judge in Thul optedto take a more measured approach in re-sponding to the omissions in the litigants’briefs, the overall takeaway here is simple.Mischaracterizing a legal authority’s

precedential effect or misrepresenting thecurrent state of the law on a contestedissue can clearly have serious repercus-sions in a litigation setting. For starters,judges are not likely to be well disposed to-ward attorneys who fail to bring relevantcase law to the court’s attention. Judgesalso have a variety of options at their dis-posal when confronted with legal briefsthat are less-than-forthright—especiallysince both the Illinois and federal courtRules allow unintentional lapses of thiskind to serve as grounds for sanctions. Re-gardless of what approach a judge takeswhen dealing with deficient briefs, the endresult can both diminish the drafting at-torney’s credibility as an officer of thecourt and undermine his or her client’sposition. These considerations plainly dic-tate that attorneys be extremely carefulwhen shepardizing the citations they planto use in their court briefs, and make surethat their final work product addressesany relevant splits of authority head-on.

Alex Zagor has worked as a Staff Attorney forthe 19th Judicial Circuit Court since July2010. He graduated from the University ofIllinois at Chicago in 2006 with a Bachelorof Arts in Economics and Political Science,and received his Juris Doctorate from theThomas M. Cooley Law School in 2009. Be-fore that, he grew up in Highland Park, IL.

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First District holding by a different division was improper because “[a] decision of our appellate court may only be reversed or overruled by this court.”).19Heckinger v. Welsh, 339 Ill.App.3d 189, 192 (2nd Dist. 2003) (quoting Thomas v. Capital Security Services, Inc., 836 F.2d 866, 878 (5th Cir. 1988)).20 See David Lat, Benchslap Update: Skadden Partners Learn Their Fates, Above The Law, Jan. 18, 2013, http://abovethelaw.com/2013/01/benchslap-update-skadden-partners-learn-their-fates/ (providing the full text of court’s opinion on the issue of sanctions with added commentary).21 Thul v. OneWest Bank, FSB, No. 12 C 6380, 2013 WL 212926 *1 (N.D. Ill. Jan. 18, 2013).22 Id.23 Id. at *2.24 Id.25 Id. at *3.26 Id.



• VIEW FROM THE BENCH • JUNE 20, 2013 •DO

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WAIT YOUR TURN

COURTESY COPIES

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DON’T TRY TO GET THE LAST WORD

JUDGES DON’T KNOW EVERYTHING

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IF THE CLERK AIN’T HAPPY • THE JUDGE AIN’T HAPPY

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ATTORNEY: Why do I have

to pay to hear the judges

tell me what not to do?

JUDGE: Because it’s cheaper

than a contempt charge.


CONSENT AGENDA• Minutes from April

• Consideration of newmembers

• Appointment to ExecutiveJustice Counsel, Steve Mc-Collum

• Appointment to JudicialSelection & RetentionCommittee to replaceJudge Walter, Torrie M.Newsome

• LCSAO Indictments: sentweekly to Criminal LawCommittee

• Installation Dinner

• 2013 Golf Championship

All items on the ConsentAgenda were adopted with-out discussion.

DISCUSSIONTreasurers ReportMichael Conway reportedthat the Association is in ex-cellent financial shape andits holdings are similar to thesame time last year. The As-sociation has not had to bor-row from the BaytreeAccount to pay bills.

2013�2014 BudgetThe proposed Budget wasdiscussed at length afterbeing presented by MichaelConway and Chris Boadt.The Board voted to adopt theBudget for 2013-2014.

Appointment of mem-

bers to the Lake CountyBar FoundationScott Gibson recommendedseveral well qualified attor-ney’s for positions within theBar Foundation. All recom-mendations were approvedby the Board and the Boardwill await the recommenda-tions for Vice President andTreasurer to be named later.

Family Law Pro Se GuidebookThe Board discussed the pro-posed Family Law Pro SeGuidebook. The Hon.Charles D. Johnson pre-sented to the Board and aftera spirited discussion, it wasresolved that the Board andthe Association would sup-port the concept going fur-ther. The Board discussedthe need for the Guidebookto remain current and up-dated as to changes in thelaw.

Security Committee, Discussion of Next StepsThe security committee con-tinues its examination ofprocedures in other coun-ties.

Membership Committee,Membership Card & Discount ProgramThe program was rolled outin last month’s issue of theDocket. Each member wasprovided a “membershipcard” which was located onthe back cover of the Docket.

This card will immediatelyqualify each member to re-deem discounts at membervendors. The committee willcontinue to work on expand-ing the discount program.

Website/DatabaseThe website is now generat-ing revenue with the sale ofsome ad space. The websitecommittee will continue itshard work.

Next meeting Thursday,June 13, 2013


May 16, 2013

Board of Director’s Meeting

ByMichaelOri,

Secretary

Minutes

MEMBERS PRESENT

Marjorie SherPresident

Steven P. McCollumFirst Vice-President

Keith GrantSecond Vice-President

Michael ConwayTreasurer

Michael OriSecretary

Perry SmithImmediate Past President

Gary Schlesinger

Mark Van Donselaar

Donald Morrison

Hon. Daniel Shanes

Carey Schiever

Brian Lewis

Chris BoadtExecutive Director



LCBA Member DiscountsThe Silk Thumb, Ltd.

1822 Second Street • Highland Park, IL 60035Phone: (847) 432-7171 • Fax (847) 432-7193

[email protected]

15% discount on silk trees, plants, and floralarrangements for offices and/or business areas. 10% off seasonal silk floral leasing program.

Discount taken off of material not labor

J. Hershey Architecture615 E Park Ave, Ste 200 • Libertyville, IL 60048

Phone: (847) [email protected]

A $500 discount offer related to professional design or consulting services for the members

of the LCBA as well as their clients

The discount may be applied with the mention of LCBA priorto cotract signing where the total fee exceeds $5,000

Current Electrical Contractors, Inc1946 Lehigh Ave • Glenview, IL 60025

Phone: (847)832-0700 • Fax: (847)[email protected]

A 10% discount on up to $2000 worth of work for a potential total of $200 savings

This is a first time/new customer only discount on labor and material

Emeric Facility Services906 McAree Rd • Waukegan, IL 60085


$100 discount off any annual commercial/office contract and $25 off any residential

project for the 1st time service

Must be for 1st time service

Lake County Movers, Inc-Bekins2344 Ernie Krueger Cir • Waukegan, IL 60085Phone: (847) 623-3329 • Fax: (847) 623-6859

[email protected]

25% discount on new packing material, additional10% discount on moving and packing services on interstate moves, guaranteed pricing on all moves with in-home estimate, free recycled

packing material (when available)

Joseph Modica & Associate, Ltd111 W Maple, Ste B • Mundelein, IL 60060

Phone: (847) 566-2240 • Fax: (847) [email protected]

A 1 hr case consultation regarding valuation, forensic accounting, economic damages, and/or other financial issues at no charge

Limit 4 consultation per year

Murphy-French & Associates736 N Western Ave, #243 • Lake Forest, IL 60045


15% discount on custom suit or shirts

Work by appointments onlyMuprhy-French comes directly to clients

Mahoney Plumbing, Inc501 Bank Lane • Highwood, IL 60040


$25 off any service call or $100 off new furnace installation

Offer cannot be combined. Offer only good in our service areas,within 20 mile radius of Highland Park



LCBA Member DiscountsIntelligent Office Lincolnshire250 Parkway Dr, Ste 150 • Lincolnshire, IL 60069Phone: (847) 325-5555 • Fax (847) 325-5566

[email protected]

10% off any virtual package

Contract must be for 6 months or longer

CrossFit Northpoint960 S. Northpoint Blvd • Waukegan, IL 60085


Free fitness evaluation, 1 free class, and 1 free month with 6 month membership

New Members onlyFree month is 7th month

Leap Associates223 Pond Ridge Rd • Libertyville, IL 60048


Discount on Innermeter • Advance Insights profile

Little Tommy’s PlumbingP.O. Box 27 • Highwood, IL 60040


10% off all plumbing, heating, and cooling service

Payment at the time of completion is required for discount

C. Lawrence & Associates, Inc482 Sumac Rd • Highland Park, IL 60035


10% discount on residential construction crew, remodeling or repair

COE Financial1121 Lake Cook Rd • Deerfield, IL 60015


A comprehensive financial plan

Domicile Consulting15216 W. Rockland Rd • Libertyville, IL 60048


5% discount

Prudential Rubloff1143 Church St • Northbrook, IL 60062


Free Professional Photo ShootMust, Buy, Sell or Lease Property

Mi-Box Mobile Storage2350 Ernie Krueger Cir • Waukegan, IL 60085Phone: (847) 249-5050 • Fax: (847) 623-6859

[email protected]% discount on Mi-Box pod delivery fee

in Lake County

At Properties600 W. Western Ave • Lake Forest, IL 60045


Complimentary real estatevaluation service

For your Estate, Bankrupcy, Divorce, and Foreclosure/Short Sale Clients

Jobs Printing & Mailing1534 Washington St. • Waukegan, IL 60085


10% off first order (excluding postage)



LCBA

BulletinBoard

DOWNTOWN WAUKEGAN

Across from Courthouse, 275-

1800 square feet. Janitorial

provided. Well maintained.

Space available. 33 N. County

& 325 Washington. Please call

Ron Pollack at (847) 482-

0952.

DOWNTOWN WAUKEGAN

Offices for Lease. 200 N ML

King Ave. 1, 2 or 3 Offices. 280

to 685 Sq Ft. Office Building for

Sale or Lease. 222 N County St.

11, 756 Sq. Ft. Will Divide.

(847) 680-4740. www.tjprop-

erties.com.

Visit the LCBA Website:lakebar.org



byCarlton R. MarcyanPresident, Lake County Bar Foundation

Participation Encouraged

Anew Foundationboard of officers andtrustees is in place.

The new board stands as fol-lows:

Carlton MarcyanPresident

Jennifer CunninghamBeelerVice President

Mark PeaveyTreasurer

Melanie RummelSecretary

Scott GibsonImmediate Past President

Brian WancaTrustee

Phil BockTrustee

Gayle MillerTrustee

Joann FratianniTrustee

Honorable Michael NerheimTrustee

Michael WallerTrustee

Honorable Daniel ShanesLiaison to the Lake County Bar

Chris BoadtExecutive Director

A meeting is scheduled to organize and plannumerous events for the upcoming fiscal yeardesigned to raise the awareness to lawyers andcommunity of what we do and our purpose.The new board has big shoes to fill followingthe excellent and forward thinking leadershipof Mark Peavey, Rick Lesser and Scott Gibsonsetting the stage for the Foundation’s growthand success. Each new board member will-ingly volunteered for the position and is highlymotivated to take on responsibilities to con-tinue the Foundation’s success.

We encourage participation; if you would liketo be a part of our mission please contact usand get involved. If you have any ideas forevents, fundraising activities or worthwhilecauses, get those ideas to us as soon as you areable.

It is a pleasure and honor to lead the Founda-tion for the next year, and we all look forwardto it.


January 2013 The Docket 37


300 Grand Avenue, Suite AWaukegan, IL 60085

Tel: 847-244-3143Fax: 847-244-8259

PRST STNDUS POSTAGE

PAIDGURNEE, IL

PERMIT NO. 356

an evening with

STINGRAVINIA • JUNE 8, 2013

Docket JUL.exp_LCBA 6/28/13 12:00 AM

docket jul.exp lcba 6/27/13 11:58 pm page 1 d the ......20 by alex zagor a d v e r t i s e r s...

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