Justia Illinois Supreme Court Opinion Summaries

Plaintiffs are minority limited partners in Urban Shopping Centers, L.P., in which defendants acquired a majority interest in 2002. Plaintiffs allege breach of fiduciary and contractual duties, claiming that, pursuant to the operating agreement, defendants were not to compete with them in business opportunities. They alleged that defendants stopped growing plaintiffs’ business, disregarded partnership agreement terms, and stole plaintiffs’ opportunities. During discovery, plaintiffs moved to compel production of documents concerning business negotiations in which each defendant’s attorney discussed with nonclients liability and obligations as Urban’s general partner and use of a “synthetic partnership” to avoid partnership obligations. Defendants claimed privilege, but plaintiffs argued that, having disclosed legal advice on these subjects with each other outside of any confidential relationship, defendants could not later object that those subjects were privileged. The motion was granted; defendants refused to comply and were held in contempt. The appellate court affirmed. The supreme court reversed, holding that attorney-client privilege had not been waived because the sought-after disclosures had occurred in an extrajudicial context and were not thereafter used by the clients to gain a tactical advantage in litigation. The “subject-matter waiver” doctrine was not shown to be applicable.View "Ctr. Partners, Ltd. v. Growth Head GP, LLC, " on Justia Law

Pielet Brothers Scrap Iron and Metal, was founded Arthur Pielet and his brothers shortly after World War II. Arthur sold his interest to his sons in 1986 through an agreement providing for a lifetime payment to him of a “consulting” fee, and, on his death, for a lifetime fee payment to his wife, Dorothy. The agreement was binding on successors and assigns. In 1994, the then- successor company, P.B.S., dissolved, but payments to Arthur continued until 1998, when its successor, MM, had financial difficulties. It filed for bankruptcy in 1999. Litigation began. The trial court awarded Dorothy almost $2 million. In the appellate court, P.B.S. argued the traditional rule that a cause of action that accrued (1998) after dissolution (1994) cannot be brought against a dissolved corporation. The appellate court rejected the argument, holding that Dorothy’s claim could survive, but remanded for determination of whether the companies could be relieved of liability for the fee under a theory of novation. The Supreme Court reversed in part, holding that the claim of breach of contract against P.B.S. could not survive the corporate dissolution. The issue of novation is relevant as to two other successor corporations and required remand. View "Pielet v. Pielet" on Justia Law

The manufacturer notified franchise dealers that it was discontinuing the Sterling (a subsidiary of Daimler) line of trucks. The letter offered dealers the opportunity to continue as a service dealership under a new agreement. Plaintiff, a dealer, was warned that, following the termination of the existing agreement, if it did not sign the general release and agree to terminate its Sterling franchise, Daimler Trucks would not renew its Detroit Diesel Direct Dealer Agreement. Daimler later terminated that agreement, which plaintiff alleges prevented it from obtaining parts at wholesale and performing warranty work on Detroit Diesel engines. Plaintiff alleged violations of the Motor Vehicle Franchise Act, 815 ILCS 710/1 and claims of breach of contract, tortious interference with contract, and fraud. The circuit court dismissed all but two counts. The appellate court affirmed, holding that the circuit court lacked subject matter jurisdiction to hear several counts under the Act, because those counts should have been brought before the Motor Vehicle Review Board. The Supreme Court affirmed. View "Crossroads Ford Truck Sales, Inc. v. Sterling Truck Corp." on Justia Law