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ISBA Mutual

  • April 25, 2013 | Practice News
    Liability Minute: The Contractual Arbitration Limitation Period for Uninsured Motorist Insurance Policies
    By Joseph R. Marconi, for ISBA Mutual 

    Even neophyte attorneys understand that their clients’ actions can be barred if they miss a statutory limitations period. However, experienced attorneys may forget that when handling claims against insurance companies under their clients’ uninsured or underinsured motorist coverage a contractual two-year limitation2 will trump any longer statutory period. Failure to adhere to the two-year limitation period will terminate a claim as surely as a blown statute.

    The Illinois Insurance Code (“Insurance Code”) (215 ILCS 5/1 et seq.) requires two provisions for all auto insurance policies issued in the state: uninsured or underinsured insurance coverage (”UM/UIM”) and a mandatory arbitration provision with respect to “any dispute with respect to coverage and the amount of damages …” 215 ILCS 5/143a. Practitioners need to realize that as a result, UM/UIM policies typically contain within them a contractual two-year limitations period for demanding arbitration of any claim against their clients’ UM/UIM carrier.

    1 comment (Most recent May 1, 2013)
  • April 10, 2013 | ISBA News
    ISBA Member Update: Take advantage of ISBA Mutual Insurance

    ISBA President John E. Thies encourages ISBA members to take advantage of the quality service and affordable prices provided by the ISBA Mutual Insurance Company.

  • January 10, 2013 | Practice News
    Liability Minute: The Incredible Shrinking Limitations Period

    Claims involving special defendants, such as municipalities, mass transit companies, school and port districts, are subject to a special one year limitations period. Certain claimants, including policemen, firemen, and guardsmen, must make claims for death benefits within a year of death. In some cases, a special notice requirement is also imposed, as early as six months from the triggering event. This article reviews the main instances of these special limitations periods.

    By Joseph R. Marconi1

    One of the cardinal rules of malpractice avoidance is to always be cognizant of any statute of limitations that applies to your clients’ potential actions and to timely file their claims.

    1 comment (Most recent January 10, 2013)
  • September 7, 2012 | Practice News
    Liability Minute: Court Rejects the Fiduciary Duty Exception

    Two recent cases out of the First District of the Appellate Court in Illinois have bolstered the right of attorneys to assert the attorney client and work product privileges to withhold documents in the context of a malpractice claim against them. In Garvey v. Seyfarth Shaw LLP, 2012 Ill. App. LEXIS 132; 966 N.E. 2d 523 (1st Dist. Mar. 1, 2012) and MDA City Apartments, LLC v. DLA Piper LLP (US), 2012 Ill. App. LEXIS 201 (1st Dist. Mar. 22, 2012), the Court rejected the application of the “fiduciary-duty” exception to the attorney client and work product privileges. The opinions give instruction as to the underlying facts and factors which will frame and preserve an attorney’s asserted privilege as against his or her former client.

  • June 25, 2012 | Practice News
    Liability Minute: Illinois Attorney General Providing Debt Settlement Services

    When elephants fight, the grass trembles.
    — African Folk Saying

    For the past several years, Illinois Attorney General ("IAG"), Lisa Madigan, and the State of Illinois have conducted a campaign against companies that purport to assist distressed homeowners and debtors in dealing with their debt situation.1 The primary weapons in the IAG's arsenal are two statutes: the Mortgage Rescue Fraud Act, 765 ILCS 940/1 et seq. (eff. Jan. 1, 2007) ("MRFA"); and, the Debt Settlement Consumer Protection Act, 225 ILCS 429/1 et seq. (eff. Aug. 3, 2010) ("DSCPA").

    Caught In The Cross-Fire Lawyers Run Afoul of The Illinois Attorney General Providing Debt Settlement Services

    By Joseph R. Marconi 2

    These statutes aim to address the allegation that many of these companies do not provide actual relief to debtors but rather worsen their situation through undeserved and excessive fees (while making fraudulent or misleading claims in the process). Among other restrictions and requirements, the statutes limit fees, including the taking of "up front" fees. See, 765 ILCS 940/50(1); 225 ILCS 429/125(a) and (b).3 The IAG's office is aggressively pursuing actions based on two laws.

  • March 15, 2012 | Practice News
    Balancing act: The ARDC is monitoring the balance on your client trust accounts

    By Joseph R. Marconi[1]

    The Rules of Professional Conduct now requires attorneys to provide consent for the banks holding client funds to automatically report overdraws to the ARDC. This is an early detection system for possible financial malfeasance and a call for more discipline in managing and accounting for client funds.

    Illinois Rule of Professional Conduct 1.15 requires attorneys to hold client property in an interest-bearing trust account separate from the attorney’s own property.  These accounts include Interest on Lawyers Trust Accounts (IOLTAs) and non-IOLTA trust accounts.  In an article from last year, In “Eligible” IOLTAs We Trust, we noted some of the September 2011 changes to this rule. One of the more significant changes to Rule 1.15 is the automatic overdraft notification provision, Rule 1.15(h).  The rule requires the financial institution at which the trust account is established to promptly notify the ARDC if a trust account is overdrawn, regardless of whether or not the instrument is honored.

    To implement the reporting requirement, the rule mandates that all attorneys admitted to practice in Illinois “shall, as a condition thereof, be conclusively deemed to have consented to the reporting and production requirements mandated by this Rule.”  Likewise, to be eligible to offer client trust accounts, financial institutions must agree to comply with the reporting requirement.

  • February 2, 2012 | Practice News
    Liability Minute: Advise to Clients Enforceability of Restrictive Covenants
     

    The Illinois Supreme Court recently issued its opinion in Reliable Fire Equip. Co. v. Arredondo, 2011 Ill. LEXIS 1836 (Ill. Dec. 1, 2011). The opinion enforced prior precedent that an employer’s legitimate business interest should be considered in deciding whether a restrictive covenant should be enforced, but it rejected the previously set “tests” and “formulas” employed by Illinois appellate courts in determining whether a legitimate business interest exists. Illinois lawyers should carefully consider the Supreme Court’s decision and reconsider their previous opinions to clients regarding the enforceability of certain covenants.

    Lawyers Should Reevaluate Advice to Clients Regarding the Enforceability of Restrictive Covenants in Light of New Illinois Supreme Court Case

    By: Joseph R. Marconi and Victor J. Pioli, For ISBA Mutual

    Ever since the Fourth District Appellate Court’s opinion in Sunbelt Rentals, Inc. v. Ehlers, 394 Ill.App.3d 421, 915 N.E.2d 862 (4th Dist. 2009), uncertainty has been pervasive regarding what factors a court should consider and what test(s) a court should apply in determining the enforceability of a restrictive covenant under Illinois law. On December 1, 2011, the Illinois Supreme Court rendered its opinion in Reliable Fire Equip. Co. v. Arredondo, 2011 Ill. LEXIS 1836 (Ill. Dec. 1, 2011) to lend some clarity to the issues.

  • November 18, 2011 | Practice News
    What can you count on these days?

    Does a statutory limitations period stated in calendar years end on the anniversary date or the day before the anniversary date? Two recent cases, one withdrawn and one with an Illinois Supreme Court Justice's pointed dissent, indicate that the answer you have been counting on may be subject to challenge.

    By Joseph R. Marconi[1], for ISBA Mutual

    Lawyers understand that every right, no matter how important, can be summarily extinguished if papers are not timely filed. The statutory timeliness of many key filings (such as a complaint) is set forth in terms of calendar years- i.e., the filing must occur "within one/two/three/ten years" of a "triggering event" (such as an injury or a contract breach). One important statutory deadline is the time within which to file a petition to vacate a judgment. The applicable deadline is found at 735 ILCS 5/2-1401(c) ("Section 1401(c)"), "the petition must be filed not later than two (2) years after the entry of the order or judgment."

    Section 1401(c) identifies a clear triggering event-"entry of the order or judgment"-which is easily and unmistakably determinable. It also provides a clear time period within which to file-two years- a factor which is also easily and unmistakably determinable. The only possible variable is when to start counting down the two years-either on the day of the triggering event, or the day after the triggering event. If one starts counting on the day of the triggering event, then filing on the (second) anniversary date is one day too late, and thus, untimely. However, if one starts counting on the day after the triggering event, then filing on the second anniversary date is timely.

  • September 22, 2011 | Practice News
    In “Eligible” IOLTAs We Trust

    By Joseph R. Marconi[1]

    Effective September 1, 2011, the Illinois Supreme Court has amended Rule 1.15 of the Illinois Rules of Professional Conduct respecting the safekeeping of client funds deposited in trust accounts. As professional fiduciaries, attorneys have long been required to keep their clients’ funds separate from their own. Now, the Supreme Court has limited the options for accounts to hold client funds, imposed new record keeping requirements on attorneys, and now requires banks to notify the ARDC when client accounts are overdrawn.

    Specifically, Rule 1.15(a) limits the type of accounts in which client funds can be deposited to two kinds. The first is an Interest on Lawyers Trust Account (IOLTA).  IOLTAs are pooled trust accounts that bear interest or dividends on nominal or short-term client funds—those funds advanced for costs or which belong in part to a client and “presently or potentially” to the lawyer.  The interest or dividends is paid to the Lawyers Trust Fund of Illinois (LTF) which donates the funds to organizations providing legal services to the poor.[2] An attorney or law firm can establish an IOLTA account by:

  • July 26, 2011 | Practice News
    Fraud alert from ISBA Mutual: Beware of checks from unknown prospective clients

    Lawyers are increasingly receiving emails from alleged potential clients who supply legitimate looking but bogus checks and then develop reasons why some or all of the money has to be wire transferred to institutions or individuals who are usually in foreign countries.  We expect these fraudulent activities to continue and we want to help our policyholders avoid these situations. While the checks are transmitted in a way that appears to be legitimate, they routinely turn out to be bogus.

    The same scenario is common with each of these scams. The law firm receives what appears to be a cashier’s check drawn on a legitimate domestic or foreign bank from a prospective client for a legitimate sounding business purpose. The law firm deposits the check in their client trust account. Almost immediately, the firm is besieged by the prospective client with urgent requests to wire transfer some or all of the proceeds of the check to banks or other recipients usually in foreign countries for legitimate sounding emergency needs. The original check turns out to be bogus.

    3 comments (Most recent July 28, 2011)