... Illinois Courts Hold.
A lawyer was sued in Illinois on "allegations that counsel retained an excessive amount of attorney fees from the settlement proceeds of a medical malpractice action." Download Continental Casualty Co. v. Donald T. Bertucci, Ltd. (Ill. 1st DCA Opinion Filed March 19, 2010), also published as Continental Casualty Co. v. Donald T. Bertucci, Ltd., 2010 WL 1033448 (Ill. 1st DCA March 19, 2010). The lawyer was also "named in attorney disciplinary proceedings" based on the same event. In Continental Casualty, the Illinois Courts applied standard legal professional errors and omissions Coverage provisions and held that there was no Coverage.
In the State Court action, the lawyer was sued on "claims of breach of contract, unjust enrichment, conversion, breach of fiduciary duty, fraud, and violation of the Illinois statute which limits contingent legal fees in medical malpractice actions". Id. (page numbers unavailable at time of publication). Both the Illinois Circuit or Trial Court, and the Illinois Appellate Court, held that there was no duty to defend or indemnify under the lawyer's policy. In basic and simple terms, the Illinois Courts compared the Policy Definition of covered "Damages" with the damages actually sought against the lawyer in the underlying lawsuit. The Courts concluded that there were no covered "Damages" at issue there. The former client's State Court lawsuit "alleges only noncovered, direct and consequential injuries from the excessive legal fees [the lawyer-Policyholder] charged against her assets; it does not allege 'damages' within the meaning of the policy."
In the Disciplinary Proceeding, the Illinois Trial Court had ruled that the event in question qualified as covered "legal services" covered under the Policy's "supplementary payments provision" for disciplinary proceedings. The Illinois Appellate Court reversed. There were no covered "legal services" at issue in the Disciplinary Proceeding, the Court held, any more than there were covered "legal services" at issue in the underlying State Court lawsuit, in the Appellate Court's view.
Fee disputes by any other name will be viewed by some Courts at least, as not being covered under standard Lawyer Professional Liability Insurance Policies.
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