THIRD DIVISION June 30, 2015

No. 1-14-1700

CONSTRUCTION SYSTEMS, INC., an Illinois ) Appeal from the Foreign Corporation, d/b/a Construction Systems of ) Circuit Court of Minnesota, ) Cook County ) Plaintiff-Appellant, ) 09 L 942 ) v. ) Honorable ) John C. Griffin and FAGELHABER, LLC, an Illinois Limited Liability ) Brigid M. McGrath, Corporation, n/k/a Thompson Coburn LLP, d/b/a ) Judges Presiding. Thompson Coburn Fagel Haber, ) ) Defendant-Appellee. )

JUSTICE MASON delivered the judgment of the court, with opinion. Presiding Justice Pucinski and Justice Hyman concurred in the judgment and opinion.

OPINION

¶1 Plaintiff-appellant Construction Systems, Inc., filed a legal malpractice action against

defendant-appellee FagelHaber, LLC, on the grounds that FagelHaber failed to perfect a

mechanic's lien on behalf of Construction Systems, resulting in the subordination of the

mechanic's lien to a mortgagee's lien. The trial court first dismissed Construction Systems'

prayer for prejudgment interest with prejudice. The case was then transferred to another

judge and FagelHaber's motion for summary judgment was granted. On appeal, Construction

Systems contends the trial court erred in granting summary judgment because the release

signed by the parties was intended solely to resolve an outstanding fee dispute and

Construction Systems was not aware of its malpractice claim at the time the release was

signed. Construction Systems also claims the trial court erred in striking its prayer for No. 1-14-1700

prejudgment interest because the statute on which the underlying claim is based allows

prejudgment interest. For the reasons that follow, we reverse the judgment of the circuit

court of Cook County and remand for further proceedings.

¶2 BACKGROUND

¶3 On May 30, 2002, Construction Systems, a steel fabrication business that provides

material and labor on construction projects, commenced work on a building project located at

6 North Michigan Avenue in Chicago. Global Real Estate Investors, LLC (Global), was the

owner of the project and AMEC Construction Services, Inc. (AMEC), was hired as

construction manager and agent for the project.

¶4 Global's members were Bassam Haj Yousif and Romel Esmail. Yousif and Esmail also

established a company called Construction Services International, purportedly to operate as

the general contractor for the project. However, this company's registration with the

Secretary of State was repeatedly allowed to lapse, it was not licensed by the city of Chicago

as a general contractor, it did not obtain the necessary permits and did not perform any of the

necessary functions of a general contractor, and AMEC was forced to act as general

contractor for the project despite that fact that its contract with Global did not provide for

such services.

¶5 The contract amount for the work to be performed by Construction Systems was

$2,684,823. During the course of its work on the project, Construction Systems supplied

additional materials and labor in the amount of $1,372,477.

¶6 On June 19, 2003, after failing to receive payments for a number of months, Construction

Systems stopped work on the project. A few additional payments were made, leaving an

outstanding balance owed to Construction Systems of $3,146,200. Construction Systems

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then retained FagelHaber to record a lien and protect its interest under the Illinois Mechanics

Lien Act (Act) (770 ILCS 60/1 et seq. (West 2012)), and to collect payment of the

outstanding balance.

¶7 On April 3, 2003, FagelHaber performed a tract index search on 6 North Michigan. On

May 6, 2003, Cosmopolitan Bank and Trust (Cosmopolitan) recorded a mortgage on 6 North

Michigan. Without updating the tract index search, on August 6, 2003, FagelHaber served a

notice of lien on Global and AMEC. The notice of lien was not served on Cosmopolitan.

FagelHaber recorded a mechanic's lien in the amount of $3,146,200 against 6 North

Michigan on October 6, 2003, but the lien likewise failed to include Cosmopolitan as an

interested party and Cosmopolitan was not included on the service list.

¶8 On December 19, 2003, FagelHaber performed a second tract index search and the results

of that search disclosed Cosmopolitan as an interested party. On January 14, 2004,

Cosmopolitan filed an appearance in Pinnacle Waste Services, Inc. v. North Star Trust

Company, No. 02-CH-09958 (Cir. Ct. Cook Co.) (hereinafter, Pinnacle litigation), litigation

involving various mechanics' liens, including Construction Systems' lien. FagelHaber

represented Construction Systems in the Pinnacle litigation, an action Construction Systems

joined but did not initiate. In late 2004, FBOP Corporation (FBOP) acquired Cosmopolitan

and filed an appearance in the Pinnacle litigation.

¶9 Construction Systems became dissatisfied with FagelHaber's representation. Due to a

lack of progress and the amount of fees charged by FagelHaber, Construction Systems

retained Karen Berres as substitute counsel in the case. Berres had previously represented

Construction Systems in connection with the construction project but had not been involved

with either the filing of the mechanic's lien or the Pinnacle litigation. On August 28, 2004,

FagelHaber was allowed to withdraw as counsel for Construction Systems. The court

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ordered FagelHaber to turn over the client file in seven days. Berres received some

documentation from FagelHaber but later learned she had not received the entire file.

FagelHaber withheld the complete file until the issue of unpaid legal fees was resolved. As

far as the record shows, FagelHaber never disclosed to Construction Systems its failure to

serve Cosmopolitan with the notice of lien or include Cosmopolitan as an interested party on

the recorded lien between the date it performed the updated tract index search in December

2003 and August 2004 when FagelHaber withdrew as Construction Systems' counsel.

¶ 10 In November 2004, Construction Systems and FagelHaber executed a general release as

part of a settlement of the fee dispute. The release stated that Construction Systems engaged

FagelHaber to perform legal services and had an outstanding balance due the firm in the

amount of $81,566.80, defined as "the Indebtedness." The release further stated: "Disputes

and disagreements have arisen between FagelHaber and [Construction Systems], including,

without limitation, with regard to the Indebtedness. Fagel Haber and [Construction Systems]

desire to compromise and settle all disputes and disagreements between them, including,

without limitation, the payment and satisfaction of the Indebtedness ***." The release then

provided details of the settlement with dates and amounts of the payments agreed to by the

parties, and noted that upon receipt of the first payment, FagelHaber would release all

remaining documents in the case file. Finally, the release provided:

"[Construction Systems] *** does hereby fully remise, release and forever discharge

FagelHaber *** of and from any and all claims, demands, actions, causes of action,

suits, *** existing at the date hereof or hereafter arising, both known and unknown,

foreseeable and unforeseeable, *** arising from or in connection with any matter, ***

including, without limitation, any Claims in connection with the legal services

provided by FagelHaber to [Construction Systems] or the Indebtedness."

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¶ 11 In the meantime, Construction Systems and FBOP (as successor to Cosmopolitan) filed

cross-motions for summary judgment in the Pinnacle litigation. In its motion for summary

judgment, Construction Systems sought to determine the priority of its mechanic's lien with

respect to the mortgage of FBOP and determine the validity of its lien. Construction Systems

argued that it was not subject to the notice requirement in section 24 of the Act (770 ILCS

60/24 (West 2012)) ("Sub-contractors *** furnishing labor, materials, fixtures, apparatus,

machinery, or services *** shall, within 90 days after the completion thereof, *** cause a

written notice of his or her claim and the amount due or to become due thereunder, to be sent

by registered or certified mail *** or personally served on the owner of record *** and to the

lending agency ***."). See Parkway Bank & Trust Co. v. Meseljevic,

(2010) ("If the subcontractor does not provide a known lender with the mandated section

24 notice, the lien is unenforceable against the lender."). Construction Systems argued that

the notice requirement did not apply because it was an original contractor rather than a

subcontractor. In the alternative, Construction Systems argued that even if it was a

subcontractor, it was not subject to the notice requirement because Cosmopolitan had notice

of its work on the project.

¶ 12 FBOP argued that Construction Systems was a subcontractor and therefore subject to

section 24's notice requirement. On August 29, 2007, the trial court denied both motions for

summary judgment and FBOP and Construction Systems entered into settlement

negotiations. In December 2007, Construction Systems settled its claim with FBOP in

exchange for the payment of $1,825,000.

¶ 13 On January 27, 2009, Construction Systems filed the underlying legal malpractice action

against FagelHaber, alleging that as a result of FagelHaber's failure to perfect its lien,

Construction Systems' lien was subordinate to Cosmopolitan's lien and it suffered a loss of

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$1,321,200. FagelHaber filed a motion to dismiss, claiming that the general release signed

by the parties as part of the fee dispute barred all claims relating both to fees and to legal

services.

¶ 14 Berres testified at her deposition that she had no knowledge that FagelHaber failed to

perfect the lien when the release was signed on November 10, 2004. She further testified that

the fee dispute was the only matter she was aware of at the time the release was executed.

On January 29, 2010, the trial court denied the motion to dismiss, concluding that it could not

determine as a matter of law that the claim was within the contemplation of the parties at the

time the release was executed.

¶ 15 On January 25, 2012, Construction Systems filed its first amended complaint in which it

sought interest pursuant to section 21 of the Act (770 ILCS 60/21 (West 2012)), which

Construction Systems claimed it would have recovered but for FagelHaber's negligence.

FagelHaber filed a motion to dismiss the request for interest with prejudice and the motion

was granted on June 13, 2012. The trial court found that although the underlying case dealt

with a mechanic's lien, the action against FagelHaber was for legal malpractice and

prejudgment interest is not available in legal malpractice actions.

¶ 16 Yuseif and Esmail were not parties and did not otherwise participate in any capacity in

the lawsuits related to the project. Yuseif was under indictment for fraud and eventually pled

guilty and Esmail left the country. Testimony indicated that Global was actually a land trust,

with Yuseif and Esmail as the sole beneficiaries, and had no assets. Construction Services

International was a corporation but it likewise had no assets.

¶ 17 The written contract in the amount of $2,684,823 between Construction Systems, the

purported subcontractor, and Construction Services International, the purported general

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contractor, was never signed. It contained multiple phrases and sentences that had been

crossed out and handwritten additions with initials next to each of the changes, but was not

executed by either party.

¶ 18 Perry Haberer, the vice president of Construction Systems, was deposed once during the

Pinnacle litigation and twice during the underlying malpractice litigation against FagelHaber.

Haberer testified that the bid he initially submitted for the project was accepted, and when

that happens, the bid is typically considered the contract. He was directed to move forward

by AMEC on the basis of the bid, and Construction Systems began the work without any

type of formal contract in place. The formal contract was not drawn up until much later and

was delivered to him by AMEC, not Construction Services International, the putative general

contractor. Haberer crossed out certain items in the contract and added handwritten

modifications. Haberer received correspondence from AMEC in both September and

December 2002 asking him to return a signed copy of the contract. But Haberer was

instructed by Berres not to sign the contract and he informed AMEC that Construction

Systems would complete the project under the terms of its bid proposal.

¶ 19 In addition to the base contract amount, Construction Systems submitted numerous cost

estimates for extra work based on changes requested by either the owners or AMEC. Several

AMEC employees were also deposed in the legal malpractice suit and conflicting testimony

was provided regarding whether these additional cost estimates had been approved.

Construction Systems contended that more than 100 change orders were approved over the

course of the project. Haberer testified that instead of his cost estimates being incorporated

into change orders, which is how it is normally done, on this project he simply received

verbal approval from AMEC to proceed with the work detailed in the cost estimate. It was

Haberer's understanding that AMEC was the general contractor for the project.

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¶ 20 FagelHaber filed a motion for summary judgment, claiming: (1) Construction Systems'

legal malpractice action was barred by judicial estoppel; (2) no genuine issue of material fact

existed on the issue of whether Construction Systems was a subcontractor; (3) the release

signed by both parties barred all future claims related to legal services provided by

FagelHaber; and (4) FagelHaber was entitled to partial summary judgment on Construction

Systems' claim for sums due to extra work. On May 14, 2014, the trial court granted

summary judgment on the ground that the release barred known and unknown claims,

including those for legal malpractice. The court denied summary judgment on the first two

grounds, finding that the action was not barred by judicial estoppel and that a genuine issue

of material fact existed regarding Construction Systems' status as a subcontractor. Because it

granted summary judgment based on the release, the trial court did not consider whether

FagelHaber was entitled to partial summary judgment on the extra work issue. Construction

Systems timely filed this appeal.

¶ 21 ANALYSIS

¶ 22 Construction Systems contends that FagelHaber was not entitled to summary judgment

because the release signed by the parties related to an outstanding fee dispute and did not bar

the subsequent claim for legal malpractice. Construction Systems further claims that it is

entitled to prejudgment interest as part of its damages in the legal malpractice action because

the statute upon which the underlying claim is based allows for recovery of prejudgment

interest.

¶ 23 Summary judgment is appropriate when the pleadings, depositions, and admissions on

file, together with any affidavits, show that there is no genuine issue as to any material fact

and the moving party is entitled to judgment as a matter of law. 735 ILCS 5/2-1005(c) (West

2012); Williams v. Manchester,

(2008). "In determining whether a

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genuine issue as to any material fact exists, a court must construe the pleadings, depositions,

admissions, and affidavits strictly against the movant and liberally in favor of the opponent.

A triable issue precluding summary judgment exists where the material facts are disputed or

where, the material facts being undisputed, reasonable persons might draw different

inferences from the undisputed facts."

We review an order granting summary judgment

de novo.

¶ 24 The Release

¶ 25 A release is a contract and, as such, is governed by contract law. Farm Credit Bank of St.

Louis v. Whitlock,

(1991). Where the terms of the release are clear and

explicit, the court must enforce them as written and construction of the release is a question

of law. Rakowski v. Lucente,

(1984). "Releases are strictly construed

against the benefitting party and must spell out the intention of the parties with great

particularity." Fuller Family Holdings, LLC v. Northern Trust Co.,

(2007) (citing Scott & Fetzer Co. v. Montgomery Ward & Co.,

(1986)).

The scope and effect of the release are controlled by the intention of the parties, and this

intent is determined not only from the express language of the release but also from the

circumstances surrounding its execution. Doctor's Associates, Inc. v. Duree,

(2001).

¶ 26 Under Illinois law, a release will not be construed to defeat a valid claim that was not

contemplated by the parties at the time the agreement was executed, and general words of

release are inapplicable to claims that were unknown to the releasing party. Whitlock,

. Indeed, "[n]o form of words, no matter how all encompassing, will foreclose

scrutiny of a release [citation] or prevent a reviewing court from inquiring into surrounding

circumstances to ascertain whether it was fairly made and accurately reflected the intention

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of the parties." (Internal quotation marks omitted.) Carlile v. Snap-on Tools,

(1995). Thus, where the releasing party is unaware of other claims, general

releases are restricted to the specific claims contained in the release agreement. Whitlock,

.

¶ 27 Here, although the release was broadly drafted to include phrases such as "without

limitation" and general language purportedly barring any claims, "known and unknown," in

connection with legal services provided by FagelHaber, the only claim referenced in the

release was the outstanding balance owed for legal fees. In fact, "the Indebtedness" is

mentioned more than half a dozen times in the release. The release provided that

Construction Systems would pay a total of $60,000 in three separate installments of $20,000

each and, in exchange, FagelHaber would release the client file upon timely receipt of the

first payment.

¶ 28 Certainly, FagelHaber was aware after it performed the second tract index search that

Cosmopolitan was an interested party at the time the lien was filed and that Cosmopolitan

was not included either on the notice of lien or the recorded lien. Thus, it is likely that

FagelHaber either knew or should have known at the time the release was executed that

Construction Systems had a potential legal malpractice claim. As noted above, there is no

indication in the record that FagelHaber ever informed its client of the failure to perfect the

lien as against the lender's interest. This court has noted that although a law firm crafting a

release in an effort to protect itself from all potential claims may have contemplated certain

other claims, such an undisclosed intent does not bring those claims within the contemplation

of both parties. Thornwood, Inc. v. Jenner & Block,

(2003).

Moreover, where, as here, a fiduciary relationship exists between the parties, the defendant

has the burden to show that a full and frank disclosure of all relevant information was made

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to the other party.

at 25-26 (quoting Rizzo v. Rizzo,

(1954), and Peskin

v. Deutsch,

(1985)).

¶ 29 Berres was representing Construction Systems at the time it signed the release. Berres

was not aware at the time the release was executed that FagelHaber had failed to perfect the

lien and, thus, was not aware of a potential legal malpractice claim. The circumstances

surrounding the execution of the release lend support to this testimony, as Berres clearly did

not have the entire client file at the time of its execution, given that obtaining the client file in

exchange for payment of legal fees was the subject matter of the release and the specific

issue in dispute between the parties.

¶ 30 The case relied on by the trial court, Goodman v. Hanson,

(2011), is inapposite. In Goodman, a client sued his former attorney for malpractice based on

the attorney's handling of certain Illinois estate and tax matters. After the case settled, the

parties executed a general release, which barred any and all claims that could have been

brought in the first malpractice action as well as any claims related to the management of the

trust and estate.

. The client later filed a second malpractice action for claims

related to a federal tax return. This court concluded the general release barred the second

action because the federal tax claims could have been brought as part of the original

malpractice action and the claims fell within the specific language of the release.

.

¶ 31 Here, there is no evidence to suggest Construction Systems contemplated a potential legal

malpractice claim at the time the release was executed. Construction Systems was not

satisfied with the progress of the lawsuit filed to enforce its lien and thought FagelHaber was

billing excessive amounts. Construction Systems then retained substitute counsel but,

despite a court order to turn over the client file, FagelHaber withheld the file because of a

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dispute over fees. Given that FagelHaber's alleged legal malpractice resulted in a claimed

loss of $1.3 million, it is highly unlikely that Construction Systems – in exchange for a

$20,000 reduction in legal fees – would have agreed to release its legal malpractice claim.

There is, at a minimum, a genuine issue of material fact on this point.

¶ 32 Similarly, FagelHaber's reliance on Gavery v. McMahon & Elliott,

(1996), is unavailing. In Gavery, the plaintiff entered into an asset purchase agreement and a

noncompetition agreement to sell his medical practice while represented by the defendant

law firm.

. In a later dispute with the purchaser, the plaintiff was represented by a

different law firm. In order to facilitate cooperation between the two law firms, the plaintiff

agreed to release the original law firm from any claims he might have against it. The

language of the release was "very specific and unambiguous" and included recitals stating

that the plaintiff had been informed by the new law firm prior to executing the release that he

might have claims against the original law firm, as well as language specifically referencing

the asset purchase agreement and the noncompetition agreement.

. After executing

the release, the plaintiff filed claims against the original law firm related to the

noncompetition agreement. This court held that the release barred the claims because it was

specific and unambiguous, the claims fell within the scope of the release, and the plaintiff

was advised by separate counsel that he may have claims against the original law firm arising

out of the agreements.

.

¶ 33 In contrast, there is no evidence prior to the execution of the release that Construction

Systems was advised that it may have a legal malpractice claim against FagelHaber, and the

release contains no recitals to that effect. Moreover, the only language in the release related

to FagelHaber's overall representation is the general clause barring any claims in connection

with the legal services provided. But because the release specifically identifies the dispute

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over legal fees as the issue being negotiated by the parties, the inclusion of one clause

containing broad language purporting to cover any claim related to FagelHaber's

representation cannot operate to bring legal malpractice claims within the contemplation of

the parties. Likewise, because of the specific language relating to the Indebtedness in the

release, the phrase "known and unknown" does not indicate that the parties intended to bar

legal malpractice claims.

¶ 34 Both the language of the release and the surrounding circumstances establish that a

genuine issue of material fact exists regarding whether legal malpractice claims were within

the contemplation of the parties at the time the release was executed. Therefore, the trial

court erred in granting summary judgment in favor of FagelHaber on the basis of the release.

¶ 35 Judicial Estoppel

¶ 36 Because this court may affirm on any basis appearing in the record, regardless of whether

the lower court relied on that ground (see Home Insurance Co. v. Cincinnati Insurance Co.,

(2004)), we address FagelHaber's contention that the doctrine of judicial

estoppel warranted summary judgment in its favor. FagelHaber argues that all of the

elements of judicial estoppel have been established and that the trial court erred in

concluding that because Construction Systems' motion for summary judgment was denied, it

obtained no benefit.

¶ 37 Judicial estoppel is an equitable doctrine designed to prevent a party who takes a certain

position in a legal proceeding from taking the contrary position in a subsequent legal

proceeding. Moy v. Ng,

(2007). The following elements are

required for the doctrine to apply: (1) a party must have taken two positions; (2) the

positions must have been taken in judicial proceedings; (3) the positions must be given under

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oath; (4) the party must have successfully maintained the first position and obtained some

benefit thereby; and (5) the two positions must be "totally inconsistent." (Internal quotation

marks omitted.) Holland v. Schwan's Home Service, Inc.,

.

¶ 38 Judicial estoppel is a flexible doctrine that should not be used when to do so would result

in an injustice. Ceres Terminals, Inc. v. Chicago City Bank & Trust Co.,

(1994). The doctrine's design and function are to protect the court from

unscrupulous litigants and preserve the integrity of the court system.

. Courts have

warned that the doctrine is "an extraordinary one which should be applied with caution"

because it impinges on the trial court's role as fact finder by "preclud[ing] a contradictory

position without examining the truth of either statement." (Internal quotation marks

omitted.)

.

¶ 39 We review a trial court's determination of whether to apply judicial estoppel under an

abuse of discretion standard. Holland,

. An abuse of

discretion occurs only when the trial court's decision is arbitrary, fanciful or unreasonable or

where no reasonable person would adopt the view taken by the trial court.

¶ 40 The trial court denied FagelHaber's motion for summary judgment on judicial estoppel

grounds for three reasons. First, the court noted that while Construction Systems presented

alternative arguments in the Pinnacle litigation, FagelHaber had not established that the

positions were factually inconsistent. Second, the court found persuasive Construction

Systems' argument that it was forced to advance alternative arguments because of

FagelHaber's professional negligence. Third, the alternative arguments were denied and,

therefore, did not benefit Construction Systems.

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¶ 41 In the Pinnacle litigation, Construction Systems included alternative arguments in its

motion for summary judgment. First, Construction Systems argued that it was actually an

original contractor and, therefore, not subject to the notice requirement in section 24 of the

Act (770 ILCS 60/24 (West 2012)). In the alternative, Construction Systems argued that

even if it was a subcontractor, it was not subject to the notice requirement because

Cosmopolitan had notice of Construction Systems' work on the project.

¶ 42 We agree with the trial court that although Construction Systems presented alternative

legal arguments, these arguments did not entail factual inconsistencies. See Giannini v.

Kumho Tire U.S.A., Inc.,

(2008) (judicial estoppel does not

apply to all types of inconsistencies but only to factual inconsistencies). On the separate

issue of whether Construction Systems could prove the existence of a subcontract with

AMEC, the trial court determined that genuine issues of material fact existed with regard to

Construction Systems' status.

¶ 43 Our examination of the record discloses evidence in support of both alternative positions

– that Construction Systems was an original contractor and that it was a subcontractor. At

one point, Haberer testified that he believed his verbal agreement was with the owners

directly, thus making him an original contractor. There was conflicting testimony regarding

whether Construction Services International was, in fact, a general contractor. The unsigned

contract identified Construction Systems as a subcontractor and the contracting party was

identified as Construction Services International, the purported general contractor. However,

Haberer also testified that he believed his verbal agreement was actually with AMEC, the

construction manager. At another point during one of his depositions, Haberer testified that

he believed AMEC was a general contractor. Therefore, we disagree with FagelHaber's

contention that "[t]he record eliminates any genuine issue of fact" on the issue of whether

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Construction Systems was a subcontractor. Given that Haberer would not have been privy to

the corporate structure of and interrelationships between and among Global, AMEC and

Construction Services International, we do not view this as a factual inconsistency

implicating judicial estoppel. Ultimately, Construction Systems' legal status as a contractor

or a subcontractor will have to be determined by a trier of fact after hearing evidence as part

of the "case within a case" in the malpractice action. See Eastman v. Messner,

(1999); Fox v. Berks,

(2002).

¶ 44 Moreover, we note that because of FagelHaber's alleged malpractice in failing to perfect

the lien as to Cosmopolitan, Construction Systems was forced to attempt to salvage the

priority of its lien by advancing the legal argument that it was not subject to the notice

requirement. The fact that Construction Systems pursued all available legal arguments

against FBOP as successor to Cosmopolitan in an attempt to recover something rather than

nothing on its lien inures to FagelHaber's benefit in the event that Construction Systems is

successful in its legal malpractice action because FagelHaber will be entitled to offset the

settlement amount against any judgment in the malpractice case.

¶ 45 Finally, we note that FagelHaber cites authority for the proposition that a settlement may

establish that a party has prevailed and thus received a benefit in the context of judicial

estoppel (see Smeilis v. Lipkis,

). However, under the

facts of this case, Construction Systems' settlement with FBOP resulted in recovering an

amount less than it was owed in order to avoid the possibility of recovering nothing. To the

extent that Construction Systems could have prevailed in recovering the entirety of its lien

had FagelHaber given notice to Cosmopolitan, the measure of damages in the malpractice

suit would be the difference between the settlement amount and the full amount of the lien.

Therefore, the fact that Construction Systems presented alternative arguments would not

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allow it to obtain a double recovery but merely put it in the same position it would have been

had the lien been properly perfected.

¶ 46 As previously noted, judicial estoppel is an extraordinary doctrine that should be applied

with caution because it impinges on the trial court's role as fact finder, and should not be

used when to do so would result in an injustice. We cannot say that the trial court abused its

discretion in declining to apply the doctrine under these circumstances.

¶ 47 Prejudgment Interest

¶ 48 Construction Systems also claims that it is entitled to prejudgment interest pursuant to the

Act as part of its damages in the legal malpractice action and the trial court erred in

dismissing its request for prejudgment interest with prejudice. Construction Systems

concedes that prejudgment interest is not available in malpractice actions but contends that

because the underlying basis of the claim is FagelHaber's failure to perfect the lien under the

Act, and section 21 of the Act (770 ILCS 60/21(a) (West 2012)) provides for prejudgment

interest, it may be recovered as an element of damages. We agree.

¶ 49 FagelHaber filed a motion to dismiss the prayer for prejudgment interest pursuant to

section 2-619.1 of the Code of Civil Procedure (Code) (735 ILCS 5/2-619.1 (West 2012)).

Section 2-619.1 of the Code allows a party to combine a section 2-615 motion to dismiss

with a section 2-619 motion to dismiss. 735 ILCS 5/2-619.1 (West 2012). A section 2-615

motion to dismiss tests the legal sufficiency of the complaint while a section 2-619 motion to

dismiss admits the sufficiency of the complaint but asserts affirmative matter that defeats the

claim. Bjork v. O'Meara,

. We review de novo an order granting a

motion to dismiss under either section 2-615 or section 2-619.

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¶ 50 In its first amended complaint, Construction Systems sought judgment against

FagelHaber in the amount of $1,321,200 "plus the interest it is entitled to under the Illinois

Interest Act and the Illinois Mechanics Lien Act." FagelHaber filed a motion to dismiss and

strike the request for interest on the ground that prejudgment interest is not recoverable in

legal malpractice actions. Relying on Tri-G, Inc. v. Burke, Bosselman & Weaver,

(2006), the trial court determined that although the underlying suit dealt with a

mechanic's lien, the Act did not apply to the legal malpractice suit and prejudgment interest

was not available.

¶ 51 FagelHaber relies on Goldfine v. Barack, Ferrazzano, Kirschbaum & Perlman,

, as additional support for its argument that prejudgment interest is not

available here. This reliance is misplaced. In Goldfine, our supreme court distinguished

cases in which the interest is hypothetical and depends on the amount of the judgment the

party would have received but for the alleged malpractice – the situation in Tri-G – and cases

in which the interest is a component of the remedial relief the plaintiffs would have

recovered in the underlying case but for the alleged malpractice. Id. ¶ 37.

¶ 52 Here, the interest is not hypothetical but is based on the amount of the mechanic's lien

that should have been perfected and, under the Act, is a component of the relief Construction

Systems would have been awarded but for FagelHaber's failure to perfect the lien. Pursuant

to the Act, the interest is not based on the amount of a hypothetical judgment but on the

amount of the lien. Therefore, Tri-G is inapplicable and the trial court erred in dismissing

Construction Systems' request for prejudgment interest with prejudice.

¶ 53 Extra Work Claim

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¶ 54 The final ground on which FagelHaber seeks to uphold its right to summary judgment, at

least in part, relates to charges for extra work included in the lien asserted by Construction

Systems. The mechanic's lien filed by Constructions Systems included $1,372,477, which

Construction Systems claimed represented charges for extra work on the project ordered by

the owner. Citing provisions in the written documents requiring the owner's approval in

writing of any change orders and Haberer's testimony that Construction Systems never

received written approval for the extra work, FagelHaber argues that Construction Systems

cannot demonstrate by clear and convincing evidence its right to recover such sums. See

Ambrose v. Biggs,

(1987) (in order to recover for extra work,

contractor must prove by clear and convincing evidence that extras were (i) outside the

original contract, (ii) requested and approved by the owner, and (iii) not necessitated by the

contractor's own conduct or undertaken voluntarily by the contractor (citing Watson Lumber

Co. v. Guennewig,

(1967))). As noted in Watson, an owner's

agreement to pay for extras may be evidenced by either words or conduct. Watson,

.

¶ 55 Our review of the record convinces us that there are genuine issues of material fact as to

whether the extra work performed by Construction Systems on the project was approved by

the owners. Haberer testified that the owners requested the additional work and that

Construction Systems submitted 151 change orders and was assured on numerous occasions

that it would be paid. While a trier of fact is certainly entitled to consider the lack of written

approval in determining whether Construction Systems has satisfied its burden, this fact is

not determinative. Thus, we reject FagelHaber's argument that it was entitled to partial

summary judgment on this issue.

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¶ 56 CONCLUSION

¶ 57 The trial court erred in granting summary judgment in favor of FagelHaber on the basis

of the language in the release because genuine issues of material fact exist regarding whether

legal malpractice claims were within the contemplation of the parties at the time the release

was executed. The trial court did not abuse its discretion in declining to apply judicial

estoppel under the circumstances of this case. The trial court further erred in granting the

motion to dismiss the request for prejudgment interest because the interest sought is a

component of the remedial relief that Construction Systems would have been entitled to but

for the alleged malpractice. Finally, FagelHaber is not entitled to partial summary judgment

on Construction System's claim for extra work. The trial court's orders entering judgment in

favor of FagelHaber and dismissing the request for interest with prejudice are reversed and

the cause is remanded for further proceedings.

¶ 58 Reversed and remanded.

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