Illinois Law Firm Recovers No Attorney's Fees After Trial Court Concluded The Firm Breached Its Fiduciary Duties

Scot Vandenberg v. RQM, LLC, 2020 IL App (1st) 190544

An Illinois appellate court affirmed the adjudication of a firm's attorney's liens down to zero, where the discharged firm failed to provide any evidence of the amount of hours it had spent on the case, and also where the firm had engaged in multiple breaches of its fiduciary duties to its clients. As a matter of law, the firm was not barred from receiving attorney's fees, but the breaches of fiduciary duty were reasonable factors for the trial court to consider in determining the appropriate amount of fees to award.

Scot Vandenberg (Vandenberg) was paralyzed after he fell off the upper deck of a yacht manufactured by Brunswick Corporation and Brunswick Boat Group (collectively, Brunswick), which was owned and operated by RQM, LLC (RQM). The McNabola Law Group (previously known as Cogan & McNabola, P.C., referred to as the Firm) represented Vandenberg and his wife (collectively, the Vandenbergs) in a negligence and strict liability action against Brunswick and RQM. The Vandenbergs signed a contingency fee agreement with the Firm, and agreed to pay the Firm's actual expenses. The fee agreement also provided for compensation to the Firm in the event the Firm withdrew prior to the resolution of the Vandenbergs' claims. In that case, the Vandenbergs agreed to pay the Firm at a rate of $450 per hour for the time spent on the claims, or 33.33% of the amount being offered in settlement at the time of the request to withdraw, whichever was greater.

Nearly five years later—and after a settlement was reached with RQM—the parties went to trial against Brunswick. After a three-week trial, the case was submitted to the jury for deliberation. While the jury deliberated, Brunswick's counsel called Mr. McNabola (McNabola) and offered a $25 million dollar settlement. McNabola relayed the offer to the Vandenbergs, who told McNabola to accept it. However, before McNabola told Brunswick's counsel of the acceptance, the judge's clerk called McNabola about a jury note. The judge's clerk read McNabola the jury's note, which asked: "Can we find fault with RQM, without finding fault with Brunswick?" McNabola told the judge's clerk not to do anything else because he wanted to try to settle the case.

McNabola then called Brunswick's counsel and accepted the settlement offer. Soon after, the judge's clerk instructed both parties to return to court where they were informed of the contents of the...