Disputing Fees and Disputing Performance

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Jonathan Waldman (“Waldman”) retained attorney Benjamin Edlavitch (“Edlavitch”) to prepare and file two patent applications in May, 2008.  For this, Waldman promised to pay Edlavitch $7,000 in advance, and signed attorney engagement agreement to that effect.  However, three months later, Edlavitch requested an additional $1,000.  Waldman agreed.  Two months after that, Edlavitch persuaded Waldman to give him another $530.  In December, 2008, Edlavitch contacted Waldman about yet more charges.  This time Waldman demanded that Edlavitch “honor the contract by completing performance without requiring additional fees.”  Id. at ¶9.  In response, Edlavitch threatened to send Waldman a termination letter and a bill, but never did so.

Nothing happened until September, 2017 when Waldman sued Edlavitch for anticipatory repudiation.  He claimed that Edlavitch had a duty to complete performance under the agreement for the “agreed flat fee of $7,000, or alternatively for the $8,000 or $8,530” he had paid, and that Edlavitch had “repudiated the contract by clear manifestation of intention that he would not complete the promised performance except on terms that went beyond the contract.”  Id. at ¶10.  Edlavitch moved to dismiss, arguing that Waldman’s complaint was barred by the two-year statute of limitations applicable to claims arising out of the provision of legal services.  The Circuit Court granted his motion.

When Waldman appealed, the Appellate Court had to consider which statute of limitations applied: ten years for breach of contract (735 ILCS 5/13-206) or two years for legal malpractice (735 ILCS 5/13-214.3(b)).  On one hand, it recognized that Waldman’s claim was “unquestionably an action for breach of contract.” Id. at ¶17.  On the other hand, Waldman’s claim also arose “out of an act or omission in the performance of professional services.”  Id. at ¶18.  The Appellate Court recognized that the language of the legal malpractice statute of limitations “indicates an intent by the legislature that the statute apply to all claims against attorneys concerning their provision of professional services.”  Id. at ¶19.  Moreover, it noted that “Waldman is not merely asserting that he should have been charged” a different amount and “wants the difference.”  Id. at ¶22.  Instead, “Waldman is saying that Edlavitch breached the contract, and he is thus entitled to a full refund of all money paid, $8,530, plus other consequential damages.”  Id. at ¶22.  According to the Appellate Court, “that is not a dispute over fees; that is a dispute over Edlavitch’s performance of legal services.”  Id. at ¶20.  Dismissal was therefore affirmed.

Waldman v. Edlavitch, 2019 IL App (1st) 181127-U

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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