Attorney Sanctions: When are Supreme Court Rule 137 Motions Appropriate? By Jennifer L. Friedland
Most of us are at least uncomfortable with the idea of seeking to have our fellow attorneys sanctioned, and we are all absolutely uncomfortable with the idea of being sanctioned ourselves. Under Illinois Supreme Court Rule 137 and within the court’s discretion, an attorney, and in some cases a party, may be sanctioned for failing to make a reasonable inquiry into the facts and law of their case before filing a Complaint.1 This article is designed to be instructional about both when seeking sanctions is appropriate, and about how to protect yourself and your clients from being sanctioned under Rule 137.
Who Can Be Sanctioned? Rule 137 states that “[t]he signature of an attorney or party constitutes a certificate by him that” he read the pleading and that he believes it is well-grounded in fact.2 (Emphasis added.) Some would argue that the word “party” in this sentence refers only to pro se litigants because in two sentences prior to this one, Rule 137 states that “[a] party who is not represented by an attorney shall sign his pleading, motion, or other paper.”3 So, if a represented party signs a verification or affidavit in support of the pleading in question, can both the attorney and the party be sanctioned for filing the baseless pleading? The answer is yes. Both the litigant and the attorney have an affirmative duty under Rule 137 to conduct an investigation of the facts and law before filing a pleading.4
Taking it a step further, can a person who verified a pleading on behalf of her employer be held individually liable under Rule 137? Although the Rule states that sanctions may be imposed “upon the person who signed it,” individual liability as a party’s agent is a factual issue.5 In Rankin v. Heidlebaugh,6 , the Fifth District found that sanctions under Rule 137 can be imposed upon a person or entity who is neither a party nor an attorney for a party.7 In Rankin, a case involving a groundless petition for a protective order for a developmentally disabled adult child, the court found that the advocacy agency that sponsored the petition could be sanctioned under Rule 137 because it was the “driving force behind all [of the] proceedings.”8 While Rankin did not specifically find an affiant or party agent liable, the court reversed the trial court’s denial of the defendant’s motion for sanctions against the non-party, non-attorney advocacy agency, holding definitively that a non-party, non-attorney can be liable under Rule 137:
“Although we are cognizant of the trial court’s concern that it was unable to sanction [a non-party, non-attorney advocacy agency] because [it] was neither a lawyer nor a party, we conclude that the court was not so powerless…”9
From Rankin, we learn that a party need not even sign the pleading to be sanctioned, as long as that party is the driving force of the lawsuit. Therefore, it is arguable that if a company-party’s employee is the “driving force” or impetus behind the lawsuit, and that employee verifies the pleading on behalf of the party, the employee can be sanctioned individually under Rule 137.
Additionally, the Second District found that Rule 137 does not authorize a trial court to sanction the attorney’s law firm if the attorney signed and filed a frivolous pleading.10 The court in Medical Alliances, LLC v. Health Care Service Corp. found that the plain language of Rule 137 precludes a construction that would allow it to sanction a law firm, and that an attorney’s responsibility to investigate his claims is nondelegable.11
Reasonable Inquiry. In determining whether or not to impose sanctions for filing an improper or frivolous pleading, courts are instructed to use an objective standard in evaluating what was reasonable under the circumstances as they existed at the time of filing.12 In determining whether to impose sanctions for filing an improper or frivolous pleading, the courts hold that it is not sufficient that the signing party honestly believed his case was well-grounded in fact or law – the party and attorney must make a reasonable inquiry into the facts and law of the case.13 The language in the statute regarding this “reasonable inquiry” reads as follows:
The signature of an attorney or party constitutes a certificate by him that he has read the pleading, motion or other paper, that to the best of his knowledge, information, and belief formed after reasonable inquiry it is well grounded in fact and is warranted by existing law or a good-faith argument for the extension, modification, or reversal of existing law, and that it is not interposed for any improper purpose, such as to harass or to cause unnecessary delay or needless increase in the cost of litigation.14
In performing her reasonable inquiry, an attorney cannot simply rely on her client’s verbal representations when the client has in his possession additional information bearing on the case facts or when additional information is readily ascertainable from third parties.15 Further, an attorney is obligated to objectively review the information submitted by her client to determine if it factually supports the client’s claim.16 If this review reveals important discrepancies, inconsistencies or gaps in information, the attorney must continue investigation prior to filing an unsupported pleading.17 However, an attorney may not be liable for sanctions if it was reasonable for her to rely on her client to inform her of the facts underlying the pleading.18
Ongoing Duty. In some cases a sanctions motion may be brought early in a case in conjunction with either (or both) a Section 2-615 or Section 2-619 motion to dismiss. Yet, in some cases, it may take time conducting discovery to learn that one is defending against baseless claims. In those situations, Rule 137 contains an implicit requirement that an attorney promptly dismiss a lawsuit once it becomes evident that it is unfounded, and a violation of this continuing duty of inquiry is sanctionable.19
Appropriate Sanction. Sanctions are not warranted simply because the facts ultimately determined are adverse to those set forth in the pleadings.20 The party requesting sanctions is obligated to show that the opposing party made assertions of fact that were untrue and were made without reasonable cause.21
If a pleading, motion, or other paper is signed in violation of Rule 137, “the court, upon motion or upon its own initiative, may impose upon the person who signed it, a represented party, or both, an appropriate sanction, which may include an order to pay to the other party or parties the amount of reasonable expenses incurred because of the filing of the pleading, motion or other paper, including a reasonable attorney fee.”22
Typically, an appropriate sanction is the party’s reasonable attorneys’ fees and costs, which are subject to the court’s review. Moreover, a party may recover fees not only for defending against the lawsuit, but also for prosecuting the sanctions motion.23 Fees are recoverable even if the attorney does not record how each minute of time was spent, but the attorney should identify general subject matter involved in his time expenditure.24
Fee awards can be substantial. In Heritage Pullman Bank & Trust Co. v. Carr, the First District upheld an award for attorneys’ fees incurred over an eight-year period.25 The Heritage court also found that unrefuted affidavits of attorneys concerning their fees incurred in defending against the frivolous pleading were an adequate basis for determining reasonableness of fees and, thus, the sanctioned party was not entitled to an evidentiary hearing absent contradictory counter-affidavits or evidence.26
Other Procedural Issues. There are a few procedural rules to remember when considering filing a sanctions motion. Because of its penal nature, Rule 137 must be strictly construed.27 All motions under this rule must be brought within the same action in which the document allegedly violating the rule was filed.28 Motions brought pursuant to Rule 137 must be filed within 30 days of the entry of final judgment or, if a timely post-judgment motion is filed, within 30 days of the ruling on the post-judgment motion.29 Rule 137 applies to the State of Illinois and any agency thereof.30 With respect to apportionment of fees, a sanctions motion must specifically allege which statements were false and what fees were incurred as a result of those false statements.31 Finally, the trial court judge is obligated to set forth in writing her reasons for entering sanctions.32
Alternatives. In cases where you may not know if a sanctions motion is appropriate, or in those where you would rather not bring a potentially volatile motion, there are good alternatives that may help you resolve the case quickly and effectively to minimize your client’s fees and costs.
If you are presented with a pleading that your client claims is baseless and the pleading has not yet been answered, one option you have is to file a notice of demand for a bill of particulars, pursuant to Section 2-607 of the Code.33 Such a notice must be filed within the time your client has to respond to the pleading and it must specify the defects complained of or details desired.34 The pleader then has 28 days to file and serve a response to the demand for bill of particulars.35 If the pleader does not file and serve a bill of particulars within the allotted time or if the bill is insufficient, the court may strike the pleading, allow further time to file the bill, or require the bill to be more specific.36 This method, at best, may result in the dismissal of the relevant claim, but at least will give you and your client more information regarding whether the claim is supported in fact and in law.
If, after some discovery, you decide that your opposing counsel did not make a reasonable inquiry into the facts and law of her case (or that the case was brought for an “improper purpose,” as described above), it may be appropriate to send her a letter asking her to dismiss the case. This is a courtesy that should prompt the attorney to consider the consequences of her actions and, if need be, dismiss the case without subjecting herself to a sanctions motion. Additionally, the letter is a good exhibit to have to your sanctions motion, if you must bring one. The letter will be useful to show the court that you gave the attorney an opportunity to dismiss the case, and you did not bring the sanctions motion unjustly or with malicious intent.
Conclusion. Seriously consider the consequences before filing a motion for sanctions. Rule 137 is not intended to penalize litigants and their attorneys merely because they are zealous, but ultimately unsuccessful.37 It is intended to protect against frivolous, harassing, or retaliatory claims brought by attorneys and parties who either simply do not do their research or have no qualms using our legal system to threaten other litigants. Although Rule 137 may seem extreme, it can be a useful tool to protect your client from paying attorneys’ fees to defend against a claim that should never have been brought in the first place.
1 Rankin v. Heidlebaugh, 321 Ill.App.3d 255, 259-60 (5th Dist. 2001); Ill. Sup. Ct. Rule 137. 2 Ill. Sup. Ct. Rule 137. 3 Id. 4 Polsky v. BDO Siedman, 293 Ill.App.3d 414 (2nd Dist. 1997). 5 Ill. Sup. Ct. Rule 137. 6 321 Ill.App.3d at 259-60. 7 Id. 8 Id. 9 Id. at 266. 10 Medical Alliances, LLC v. Health Care Service Corp., 371 Ill.App.3d 755 (2nd Dist. 2007). 11 Id. 12 Whitmer v. Munson, 335 Ill.App.3d 501, 514 (1st Dist. 2002). 13 Id.; Ill. Sup. Ct. Rule 137. 14 Ill. Sup. Ct. Rule 137. 15 Chicago Title & Trust Co. v. Anderson, 177 Ill.App.3d 615, 624 (1st Dist. 1988). 16 Id. 17 Id. 18 Couri v. Korn, 202 Ill.App.3d 848, 856 (3rd Dist. 1990). 19 Rankin, 321 Ill.App.3d at 259-60. 20 Bennett & Kahnweiler, Inc., 256 Ill.App.3d 1002, 1007 (1st Dist. 1993). 21 Id. 22 Ill. Sup. Ct. Rule 137. 23 Robertson v. Calcagno, 333 Ill.App.3d 1022, 1028-29 (1st Dist. 2002). 24 Id. 25 Heritage Pullman Bank & Trust Co. v. Carr, 283 Ill.App.3d 472 (1st Dist. 1996). 26 Id. at 480. 27 Medical Alliances, LLC v. Health Care Service Corp., 371 Ill.App.3d at 757. 28 Ill.Sup. Ct. Rule 137. 29 Id. 30 Id. 31 Id.; Whitmer v. Munson, 335 Ill.App.3d at 513. 32 Ill.Sup. Ct. Rule 137 33 735 ILCS 5/2-607. 34 Id. 35 Id. 36 Id. 37 Whitmer v. Munson, 335 Ill.App.3d at 513.
Jennifer L. Friedland (formerly Jennifer L. Moore), J.D. Tulane University Law School is an associate with Momkus McCluskey, LLC practicing in the area of insurance coverage, family law and commercial litigation.