Landers Children Family, LLC v. Rees

1

2024 IL App (4th) 230460-U

LANDERS CHILDREN FAMILY, LLC, an Illinois Limited Liability Company; WILLIAM LANDERS, Individually and as Co-Administrator on Behalf of the Estate of Ray Landers; NEXT GENERATION MINISTRIES INTERNATIONAL, INC., an Illinois Not-for-Profit Corporation; EQUIPPING THE SAINTS MINISTRY; INTERNATIONAL, INC.; JENNIFER CHANCE; and BILLIE SUE LANDERS, Not Individually but as Trustee of the Landers Family Trust Plaintiffs-Appellants, v. EDMOND REES; BRANDENBURG-REES &REES, an Illinois General Partnership; SONDRA NARMONT and WILLIAM J. NICHOLLS, as Co-Executors of the Estate of John Narmont; JASON GERMERAAD; and SCOTT AND SCOTT, P.C., an Illinois Business Corporation, Defendants-Appellees.

No. 4-23-0460

Court of Appeals of Illinois, Fourth District

July 2, 2024

This Order was filed under Supreme Court Rule 23 and is not precedent except in the limited circumstances allowed under Rule 23(e)(1).

Appeal from the Circuit Court of Sangamon County No. 20L252 Honorable Gail L. Noll, Judge Presiding.

JUSTICE HARRIS delivered the judgment of the court. Justices Doherty and Turner concurred in the judgment.

ORDER

HARRIS, JUSTICE

¶ 1 Held: The trial court did not err by granting defendants' motions to dismiss plaintiffs' legal malpractice complaint on the basis that it was not timely filed within the two-year statute of limitations.

¶ 2 Plaintiffs-Landers Children Family, LLC, an Illinois limited liability company (LCF); William Landers individually and as coadministrator of the estate of Ray Landers; Next Generation Ministries International, Inc., an Illinois not-for-profit corporation (Next Generation) Equipping the Saints Ministry International, Inc. (Equipping the Saints Ministry); Jennifer Chance; and Billie Sue Landers, as trustee of the Landers Family Trust (Trust)-appeal the trial court's dismissal with prejudice of their legal malpractice complaint against defendants-Edmond Rees; Brandenburg-Rees &Rees, an Illinois general partnership; Sondra Narmont and William J. Nicholls, as coexecutors of the Estate of John Narmont; Jason Germeraad; and Scott and Scott, P.C., an Illinois business corporation. They contend the court erred in finding their legal malpractice action was untimely filed outside the relevant two-year statute of limitations or determining that their action was untimely as a matter of law when (1) questions of fact existed as to the timeliness of their complaint or (2) multiple conclusions could be reached from the undisputed facts. Alternatively, plaintiffs argue the court erred in failing to find the doctrines of equitable estoppel and fraudulent concealment barred defendants from raising a statute of limitations defense. We affirm.

¶ 3 I. BACKGROUND

¶ 4 On December 28, 2020, plaintiffs filed their legal malpractice complaint against defendants. Decedent Ray Landers was originally named as a plaintiff in the complaint however, following his death during the underlying proceedings, a representative of his estate was substituted as a party plaintiff. Similarly, on appeal, this court granted a motion filed by counsel for defendant Narmont, alleging Narmont died in January 2024 and asking to substitute representatives of his estate as party defendants. (We note a suggestion of death was also filed with this court indicating defendant Rees died in May 2023; however, no motion to substitute an alternate party has been filed relative to his death.) Plaintiffs' complaint set forth the following factual allegations.

¶ 5 Ray was a minister who, with his wife Billie Sue Landers and children, "purchased and developed *** properties to advance Ray's ministries and to support their families." Ray formed various business entities, including plaintiffs Next Generation, Equipping the Saints Ministry, and LCF, a real estate development company. Ray's four children, including plaintiffs William and Jennifer, were members of LCF. Jennifer was LCF's manager from 2004 to 2014, and Ray was authorized to act as LCF's agent. To finance its projects, LCF obtained loans from State Bank of Lincoln (State Bank). From May 2009 to January 2014, State Bank extended five loans to LCF, which totaled over $2.4 million and were secured by mortgages on real estate owned by LCF. The terms of the loans were set forth in promissory notes, each of which contained a provision that authorized any attorney to appear in court without process and confess judgment in favor of State Bank for any amount due on the note.

¶ 6 In October 2014, Ray began negotiating with State Bank regarding "additional financing" for LCF. As part of the negotiations, he "sought the advice and counsel of' attorneys Rees and Narmont. During negotiations, State Bank proposed a forbearance agreement, under which existing loans "would not be foreclosed upon" and LCF would provide "additional collateral." Ray told Rees and Narmont that he did not want to add additional property as collateral because he intended such property to be inherited by his children. He also informed them of his belief that State Bank had not accurately stated the amount of the loans. Rees and Narmont advised Ray that he could protect properties not encumbered by loans by transferring them into a trust. Ray agreed to follow their advice, and Narmont prepared a family trust. In December 2014, LCF transferred property not encumbered by the State Bank loans into the Landers Family Trust, of which Billie Sue was trustee. Thereafter, Rees and Narmont continued to negotiate with State Bank on behalf of LCF.

¶ 7 Ultimately, however, State Bank initiated legal proceedings against LCF and other plaintiffs. In April 2015, in Sangamon County case No. 15-L-100, State Bank obtained confessions of judgment based on the five loans it extended to LCF in amounts totaling over $3.2 million and representing unpaid principal, interest, charges and late fees, and attorney fees. According to plaintiffs, neither Ray nor LCF were given notice of the proceedings for confessions of judgment.

¶ 8 Also in April 2015, in Sangamon County case No. 15-CH-192, State Bank brought an action against LCF, Ray, "and other associated entities" to foreclose on the properties that secured the promissory notes for the loans. Plaintiffs alleged that when Ray received notice of the litigation, he forwarded it to Rees and Narmont. Finally, in August 2015, in Sangamon County case No. 15-CH-316, State Bank brought a third action against LCF and the Trust, alleging the fraudulent transfer of assets in connection with LCF's transfer of property into the Trust.

¶ 9 Plaintiffs alleged that prior to State Bank initiating legal proceedings, Rees caused his law firm, defendant Brandenburg-Rees & Rees, to file suit against Ray, LCF, Equipping the Saints Ministry, Next Generation, William, and Jennifer, alleging Rees and his law firm were entitled to $71,786 in unpaid legal fees. After State Bank's causes of action were filed, Rees agreed to represent plaintiffs in both the foreclosure and fraudulent transfer cases, while "Narmont also agreed that he would continue to assist *** plaintiffs when needed." According to plaintiffs, Rees conditioned his representation on Ray consenting to a judgment in the full amount of Rees's alleged unpaid attorney fees. Ray agreed, consenting to a judgment of $71,786 on behalf of LCF and the Trust. Following Ray's agreement, Rees told Ray he would file an appearance on behalf of plaintiffs in both the foreclosure and fraudulent transfer cases. Ray contacted Rees "from time to time *** to see how the cases were going," and "Rees would assure Ray the cases were proceeding satisfactorily." Plaintiffs maintained that when Narmont was asked about the cases, he repeatedly stated, "[N]ot to worry, 'We'll get 'er done.' "

¶ 10 Plaintiffs maintained, however, that contrary to Rees's and Narmont's assurances, the foreclosure and fraudulent transfer cases "were not going well," and Rees had not "responded or answered the complaints or appeared in court." On September 25, 2015, State Bank obtained a default judgment of foreclosure on all counts in the foreclosure case. At the time, Rees had not entered his appearance in the case. The foreclosure judgment provided for a redemption period ending on February 5, 2016, in connection with one of the properties at issue that was comprised of farmland, and otherwise stated the trial court's judgment was final and appealable and that a sheriff s sale would occur on a date set by State Bank. On October 8, 2015, State Bank filed notices of sale, indicating a sheriff's sale would occur on November 17, 2015.

¶ 11 Plaintiffs alleged that neither Rees nor Narmont took any action on their behalf after the judgment of foreclosure was entered. They also asserted that neither attorney informed them that the farmland property could be redeemed until February 2016 or "that someone could appear at the sheriff's sale on plaintiff[s'] behalf to bid on the property." On November 6, 2015, Rees appeared in court and obtained his judgment for unpaid attorney fees against LCF and the Trust. The same day, Rees wrote a letter to State Bank's attorney and requested a postponement of the November 17, 2015, foreclosure sale. He also mailed an answer to State Bank's complaint in the fraudulent transfer case, denying State Bank's allegations.

¶ 12 Plaintiffs alleged that between November 6 and 17, 2015 Rees did not file his appearance in the foreclosure case or any motions seeking to set aside the default judgment or to continue the sheriff's sale. They further asserted that Rees was "out of town" on November 17, 2015, and the sheriffs sale went forward with State Bank as the sole bidder on the four properties that were for sale. Plaintiffs alleged the fair market value of the properties...