real estate law section mcle meeting location: attorney …€¦ · manage profile ->...

Real Estate Law Section MCLE Meeting Location: Attorney Resource Center

Date: February 14, 2019

11:45 AM – Noon Welcome/Introductions Nick Nelson, Section Chair

Noon – 1:00 PM Program

Real Estate Litigation: Look Before You Leap Barry Brotine, Area Underwriting Counsel-Chicago Title Ins. Co.

Speaker’s Bio

See attached

Presentation Summary

The decision to litigate should not be taken lightly. An attorney will need to assess the situation and know the story, your clients hard costs, softs costs and the internal analysis before filing a complaint and taking on the risk of litigating.

Next Meeting: March 14, 2019

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Barry C. Brotine 327 W. Palatine Rd. Palatine, Illinois 60067 (312) 952-9230 [email protected]

EMPLOYMENT: Chicago Title Insurance Company

VP and Area Underwriting Counsel, current Consistent and thorough problem solver and solution finder for all title insurance needs. Serve as point person for all aspects of title from examination through closing. Commonly work on projects of varying sizes from multi-million dollar commercial and industrial transactions including power plants, apartment and condo buildings, multi-use facilities and complexes, agricultural land and condo deconversions to single-occupancy restaurants and retail out lots. Responsible for monthly training with title team and regularly draft internal memos on current title issue to region and consistently present CLEs and other engagements to customers and trade associations. Fidelity National Financial, Fidelity National Law Group The Law Division of Fidelity National Title Insurance Co., Chicago Title Insurance Co., Commonwealth Land Title Insurance Company, Alamo Title Insurance Co., and others. VP and Litigation Counsel, June 2011-May 2017

Represent and serve the company, its subsidiaries, its agents and its insureds in various types of litigation including title, construction and mechanic’s liens, lien priority, contract, insurance, coverage, commercial litigation, agency, premise liability, and indemnity litigation. Conduct internal audits & investigations, complete due diligence reports, quality assurance and risk management activities, internal business strategies, and advise all divisions on legal issues. Manage outside counsel, assist in corporate governance and policy drafting, and assist in reserve setting and claim evaluations.

Bryce Downey & Lenkov LLC, Attorney 2006 - 2011 Represent corporations, manufacturers, and first and third-party actions in commercial and complex litigation, construction, real-estate, product liability, and catastrophic loss cases.

Querrey & Harrow, Ltd., Attorney 2004 - 2006 Represented corporations, insureds, and government entities with claims arising from professional liability, premise liability, and general commercial.

U.S. Attorney’s Office for the Northern District of Illinois, Chicago, IL Rule 711 Attorney

AWARDS: SuperLawyers: 2012 Illinois Rising Star, top 2.5% of all Illinois attorneys

EDUCATION: Chicago-Kent College of Law, Illinois Institute of Technology, Chicago, IL Juris Doctorate, May 2004 Chicago-Kent Law Review, Senior Editor & Treasurer, Student Bar Association

University of Illinois at Urbana-Champaign, Urbana, IL Bachelor of Arts in Urban Planning with honors, May 2001 Outstanding Man of the Year Award, 2001

Vice President, Inter-Fraternity Council; President, Pi Lambda Phi Fraternity

PUBLICATIONS: “Resolving Discovery Disputes Out of Court,” CBA Record May 2009 “The Conflicting Conflicts of the Fosler Decision,” DRI Medical Journal, June 2009 “Emergency Exception to Medical Battery,” IDC Quarterly, March 2010 “We Are Family, But Not When It Comes To Torts,” CBA Record, February 2011 And numerous law firm and company newsletters and legal update reports.

AFFILIATIONS: Chairman of YLS Moot Court Competition, CBA-Judicial Evaluation Committee, Lincoln Inn of Court, and Chicago Anti-Defamation League.

ADMISSIONS: Illinois, U.S. District Court for Northern District of Illinois, Federal Trial Bar

RELEVANT EXPERIENCE: Extensive experience representing corporations, manufacturers, and insurance entities in commercial

litigation, construction, product liability, title and lien priority, contract, insurance, and catastrophic loss actions. Throughout my career I have first-chaired dozens of trials. I am responsible for the daily management of a large caseload with regular court appearances, drafting and responding to pleadings, all written and oral discovery, taking and defending party and expert depositions, and draft comprehensive case report letters. I have substantial experience in drafting and arguing substantive motions including summary judgment motions and appeals in state and federal courts. First Chair trial experience involving multi-million dollar claims related to large commercial and

industrial buildings and complexes, large condo developments, subdivisions, and farmland as well product liability, catastrophic injury, and premise liability cases.

Conduct internal audits & investigations related to government compliance, internal and external regulations, and pre and post litigation analysis.

Prepare due diligence and strategy reports related to internal quality control, business strategy, and changes in the law as to business functions. Assist in corporate governance and policy drafting.

Conduct quality assurance and risk management activities related to pending and anticipated litigation and advise as to loss-reserves, liability exposure, recoupment, and remedial action.

Serve as on-call attorney for division managers as resource for legal advice on a broad-range of issues related to all aspects of the company’s activities.

Supervise junior attorneys, paralegals, administrative staff, vendors, and manage outside counsel regarding ongoing legal matters.

REPRESENTATIVE MATTERS: Represented lender on a $70 million lien priority claim related to the Chicago Spire Project.

Represented lenders on various lien priority and mechanic’s lien claims including a $40 million subdivision development case, $25 million hotel development case, $20 million retail development case, $20 million industrial development case, and dozens of multi-million dollar construction and loan related claims.

Defended company related to catastrophic injury case involving silo explosion resulting in no liability for company despite a $180 million verdict against other defendants.

Represent company related to judgment and liability indemnity lawsuits. Represent company and its officers before administrative hearings Conduct and respond to e-discovery subpoenas and administer records retention policies. Conducted hundreds medications, arbitrations, and settlement conferences. Frequent speaker in the legal community and serve as corporate representative at various

governmental hearings and inquiries.

REPORTED DECISIONS: Chicago Title Insurance Co. v. Teachers’ Retirement System of State of Illinois,

2014 IL App. (1st) 131452, 7 N.E.3d 19 (2014). Eastwood Development, LLC, Urgacz, 2014 IL App. (1st) 123757-U, Not Reported in N.E.3d (2014). David McClain and Sanaa Hachem v. Chicago Title Insurance Co, 2015 IL App (1st ) 133971-U, Not reported in N.E.3d 19 (2015). Hensley Construction LLC v. First Midwest Bank, 2015 IL App (2nd) Expected Soon.

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Barry C. Brotine: 2/14/19, DCBA

Real Estate Litigation: Look Before You LeapWhat you need to know before diving in

Barry C. BrotineArea Underwriting CounselChicago Title Insurance Company2441 Warrenville Road, Suite 100Lisle, Illinois [email protected]


Today’s CLE:

You:

Earn CLE, take notes, try not to fall asleep, ask questions.

Me:

Try not to be boring.

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Overview

• Meet Me

• Assess the situation

• Have a conversation

• Do math

• Set limitations

• Make a plan

• What is a victory?


Barry C. Brotine1998‐2000: Intern for Winnetka Zoning Department and 2 years at City of Chicago Zoning Department2001: University of Illinois, Urbana‐Champaign, BA with honors. Major Urban Planning2001: Economic Development Officer for City of Urbana2004: Chicago‐Kent College of Law, JD, Senior Editor Law Review2004 – 2011: Private Practice in civil litigation2011: Drank Kool‐Aid, In‐house counsel for Fidelity National Law Group Represented lender on a $70 million lien priority claim related to the Chicago Spire Project. Represented lenders on various lien priority and mechanic’s lien claims including a $40 million subdivision development case;$25 million hotel development case, $20 million retail development case, $20 million industrial development case;and dozens of multi‐million dollar construction and loan related claims. Obtained no liability verdict in catastrophic injury case involving silo explosion despite a $180 million verdict. Represent company related to judgment and liability indemnity lawsuits. Represent company and its officers before administrative hearings. Conduct and respond to e‐discovery subpoenas and administer records retention policies. Conducted hundreds of mediations, arbitrations, and settlement conferences. Frequent speaker in the legal community and serve as corporate representative at various governmental hearings and inquiries.

2017: Double‐downed on the Kool‐Aid: Area Underwriting Counsel for Chicago Title

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Some words of caution: “Mr. Brotine, Mr. big city lawyer, Mr. deep pockets client…” – Madison County Judge

“Your client has more money than him, you should just pay more, that’s fair.” – Cook County Judge

“Are you really going to waste everyone’s time taking this to trial? You go to trial; I’m going to make sure your client regrets settling!” – Cook County Judge

“Counsel, I don’t grant summary judgments, period. I don’t care if every fact and law is in your favor. The appellate court reverses summary judgment decisions for all kinds of [expletive] reasons, they don’t reverse trial rulings. Settle or pick a trial date.” – Will County Judge

“Counsel, all your motions in limine are denied. I didn’t even read them. You have 4 hours to put on your case, that’s it. We don’t do multiple‐day, multiple‐witness circus trials here. 4 hours is enough, get on with it, the clock is ticking” – Marion County Judge

“I tried to read the [Mechanic’s Lien] Act last night and didn’t understand a word of it.” – Kane County Judge

“In Illinois, litigation is the last form of legalized gambling” – non‐attributable


Assess the situation

1. What does the person want? 2. Is the person already a client or potential new client?3. Are you being attacked personally?4. Did you create the problem?5. Was the problem foreseeable? 6. Are you comfortable?7. Do you want this person as a client?

- Can you communicate with him/her?- Can they pay you?

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Having the conversation…or several…

1. Do you want them as a client?2. Can they pay you? Can they pay you through the duration?3. Ground rules for communication.4. Ask a bajillion questions!5. Paperwork.6. Road map clients.7. You be honest. 8. Don’t over promise.


Do math!

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See Real Estate Bar Ass’n for Mass., Inc. v. Nat’l Real Estate Info Servs., 642 F. Supp 2d 58 (D. Mass 2009)


Math = Money

Hard Costs:

$290 filing fee$50ish + $30/per serviceCopies…paper…Deposition: $500-$1,000 perSubpoenas $20 per + mileageMailing feesTravel costs: mileageExpert? $250/hr minimum

Trial costs: whole other CLE!

Simple uncontested QT$290 + $80 + $100 (p) = $470

Heavily contested QT4 parties2 witnesses2 expert surveyors$290 + $80 + $7500 (deps) + $80 (sub) + $50 (mailing) + $100 (travel) + $3,000 (xp1) + $1000 (xp2) + $200 (p) =$12,300

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Math = MoneySimple uncontested QTInitial pleadings: 6Dispositive motions: 8Court time: 6Internal work time: 5

25 hours. $150/hr = $3,750

Heavily contested QTInitial pleadings: 40Written discovery: 50Oral discovery: 60Dispositive motions: 80Court time: 20Internal work time: 200

450 hours. $150/hr = $30,250

Hard costs added:$290 + $80 + $100 (p) = $470

$3,750 + $470 = $4,220

Hard Costs added$290 + $80 + $7500 (deps) + $80 (sub) + $50 (mailing) + $100 (travel) + $3,000 (xp1) + $1000 (xp2) + $200 (p) =$12,300

$30,250 + $12,300 = $42,550

10x difference.

Your time. Hourly rate?Flat rate?Phase rate?Contingency?100 to 1: magic ratio


Set Limitations

Limitations with client. - Money- Communication- Litigation goals

Limitations with litigation. - Money- Discovery (sufficient or scorched earth)- Moving to goal vs. harassment- Settlement?- Reputation

Limitations with yourself/family. - Money- Time- “this case will be the death of me”- Reputation

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Make a plan: your litigation strategyCommon real property legal recourse causes of action:

Breach of warranty in deed – statutory cause of action, see 765 ILCS 5/9Breach of special warranty in deed – s/he didn’t keep promise from the list on back of deed and I want them toWarranties – this thing is broke and shouldn’t be so fix itSpecific performance – s/he didn’t do what they contracted to and I want them to do itBreach of contract – s/he didn’t do what they contracted to and I want $$Quiet title – someone else is claiming title to my property and I don’t like it. Rescission – Let’s undo all of what we just did, easy enough…Reformation – Let’s change what is says to match this other thingAdverse Possession – I’m openly taking your property for 20 years (which you knew about) and now it’s mineForeclosure – you once gave me the right to take your property if you didn’t pay, you haven’t paid so…

- Mortgage, you didn’t follow the payment plan and now your property is mine. - Mechanic’s lien, you didn’t pay me for work I did and now I’m selling you property as payment

Equitable lien – you knew you were taking my money to get the property so I should have the right to forecloseTRO – Woah! Stop that now because of specific reasonsInjunction – You cannot and will not ever do that from here to eternity Declaratory judgment – Judge, I want you to agree with this thing I’m alleging, cool?


Examples:

Breach of warranty in deed:(1) that at the time of the making and delivery of such deed he was the lawful owner of an indefeasible estate in fee simple, in and to the premises therein described, and had good right and full power to convey the same; (2) that the same were then free from all incumbrances; and (3) that he warrants to the grantee, his heirs and assigns, the quiet and peaceable possession of such premises, and will defend the title thereto against all persons who may lawfully claim the same. Such covenants shall be obligatory upon any grantor, his heirs and personal representatives, as fully and with like effect as if written at length in such deed. 765 ILCS 5/9.

Barry’s take: [shameless plug] get title insurance…

Warranties:Typically contract based. Explicit warranties (you’ll sign off on them)- Callback (repair) warranty – within one year if stuff still not working, will fix- Vendor warranty – this leaf guard system is guaranteed to prevent gutter blockage for 10 yearsImplicit warranties- Good workmanship – latent defects in materials (Chinese drywall)- Habitability – that roof better not leak and what’s up with that spillage from the septic tank…

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Specific performanceContract based, but keep the contractParty to contract fails to perform obligations under the contractSeller was to replace all carpets before certain date and didn’t. Seller gets a better offer and sells property to third party despite your signed/agreed to valid contract.^^and the reverse, buyer gets cold feet and does not show at closing. Secondary HELOC mortgagor agrees to a $10k payment in lieu on approval of short sale but fails to cash the check after closing and fails to release note.

Breach of contract Break the contract for these reasons…

Quiet titleA quiet title action is an equitable proceeding wherein a party seeks to settle a dispute over ownership of a property or to remove a cloud on his title to the property. Lakeview Trust & Savings Bank v. Estrada, 134 Ill. App. 3d 792, 811-12 (1985). A cloud on title is the semblance of title, either legal or equitable, appearing in some legal form, but which is, in fact, unfounded or for which it would be inequitable to enforce. Id. at 812. In order to remove a cloud from title, the plaintiff must demonstrate he actually has title, as well as possession of the property at the time the suit was filed. Bennett v. Chicago Title & Trust Co., 404 Ill. App. 3d 1088, 1100 (2010). "Where the property is not vacant and is not in the possession of the party seeking to remove the cloud from his title, the proper remedy is not an action to quiet title but rather an action in ejectment." Estrada, 134 Ill. App. 3d at 812.


RescissionUnwind this entire transaction(s) (usually in the case of a hidden fraud)The cancellation of a contract to restore the parties to the status quo ante, their status before they entered into the contract. Hassan v. Yusuf, 408 Ill. App. 3d 327, 353 (2011).Going from Z to A, take into consideration property taxes, SSAs, HOAs, etc.

ReformationTypically in foreclosure actions to cure scrivener's errors in deed or mortgage (mostly with legal description). Curative measure, but also attack (parking spots in condos)(1) the existence and substance of an agreement between the parties and the identity of the parties to that agreement; (2) the parties agreed to reduce their agreement to writing; (3) the substance of the written agreement; (4) a variance exists between the parties' original agreement and the writing; and (5) the basis for reformation (for example, mistake or ambiguity). Schaffner v 514 West Grant Place Condominium Ass'n, Inc., 324 Ill App 3d 1033 (2001)

Adverse PossessionA party must prove that his or her possession of land was: (1) continuous, (2) hostile4 (3) actual, (4) open, notorious and exclusive, and (5) under claim of title inconsistent with that of the true owner for a period of 20 years. All five of these elements must have existed concurrently for the full 20‐ year period before the doctrine will apply. Tapley v. Peterson, 141 Ill.App.3d 401, 405 (1986).Driveway Example

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Foreclosure:- Mortgage: please see Hon. Rohm. & Hon. Orel- Mechanic’s liens: for examples please see Hon. Wheaton

Equitable lien:- For my own sanity, not going to discuss.

TRO & Injunction:- Typically in construction sense or just before a sale.

Declaratory judgment:- Catch-all.


What is victory? 1. Ultimate goal of litigation?

a) Money? b) Property? c) Clearance for next phase?d) Principle?e) Show?f) Delay?g) To drain opposition?

2. Are you comfortable with the goal? Do you agree?3. What is plan b?4. Does settlement fit within the victory plan?

(if it doesn’t please don’t litigate…)

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YOU

NOT FALLING ASLEEP DURING THIS CLE

February 14, 2019


Questions? Comments? Criticisms?

real estate law section mcle meeting location: attorney …€¦ · manage profile ->...

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