Ennenga v. Starns

In the

United States Court of Appeals

For the Seventh Circuit

Nos. 09-3118, 09-3221 & 09-3222

G EORGE E NNENGA, individually and as father

and next friend of India Ennenga, a minor,

and INDIA E NNENGA, a minor,

Plaintiffs-Appellants/

Cross-Appellees,

v.

B YRON E. S TARNS, et al.,

Defendants-Appellees/

Cross-Appellants,

and

W OODRUFF A. B URT, et al.,

Defendants-Appellees/

Cross-Appellants.

Appeals from the United States District Court

for the Northern District of Illinois, Western Division.

No. 06 C 50117—Frederick J. Kapala, Judge.

A RGUED JANUARY 13, 2011—D ECIDED A PRIL 17, 2012

2 Nos. 09-3118, 09-3221 & 09-3222

Before R IPPLE, E VANSΠ, and S YKES, Circuit Judges.

S YKES, Circuit Judge. This case involves claims of legal

malpractice and breach of fiduciary duty stemming

from a dispute about an inheritance. Not normally the

subject of federal litigation, the case is in federal court

based on the parties’ diverse citizenship. Tom and

Ida Lou Ennenga lived in rural northern Illinois and had

three children—Constance (known as “Connie”), Lucie,

and George—and an estate valued at $3 or $4 million.

Connie and Lucie each had three children; George had

one child, a daughter named India. In 2000 Tom and

Ida Lou revised their estate plan with the assistance of

Woodruff Burt, their Illinois lawyer, and Lowell Stortz,

a Minnesota attorney and law partner of Connie’s

husband, Byron Starns. The revised estate plan con-

tained a trust agreement that treated George Ennenga

less favorably than his sisters and India less favorably

than her cousins.

The Ennengas died within a month of each other in

2004. Their estate was probated without challenge in

Illinois state court, although George and India sued to

stop the sale of the family homestead to a third party.

They abandoned that claim and eventually brought this

suit in federal court against the three attorneys—Starns,

Stortz, and Burt—and their law firms. They alleged legal

malpractice and breach of fiduciary duty based on a

Œ

Circuit Judge Terence T. Evans died on August 10, 2011, and

did not participate in the decision of this case, which is

being resolved by a quorum of the panel under 28 U.S.C. § 46(d).

Nos. 09-3118, 09-3221 & 09-3222 3

conflict-of-interest theory; a later version of the com-

plaint alleged that the attorneys had not drafted the

estate plan as Tom and Ida Lou intended.

The district court rejected the conflict-of-interest argu-

ment and dismissed most of the claims as untimely or

barred by res judicata. India’s minor status tolled the

statute of limitations, however, so her legal malpractice

claim survived the motion to dismiss. The defendants

moved for summary judgment, arguing that India’s

damages are speculative and might not materialize at

all, and that she lacks factual support for her claim that

the estate plan failed to carry out Tom and Ida Lou’s

intent. The court agreed with the first argument and

dismissed India’s claim as premature, later amending

the judgment to reflect that the dismissal was without

prejudice. George and India appealed. The defendants

cross-appealed, asking that India’s malpractice claim

be dismissed with prejudice.

We affirm and grant relief on the cross-appeal. This

case presents a tangle of procedural and substantive

issues. Simplifying, we hold as follows: (1) although

the district court dismissed India’s claim without preju-

dice, we have appellate jurisdiction because the court

is clearly done with the case; (2) the district court

properly chose Illinois’s statute of limitations over Min-

nesota’s; (3) the court properly rejected George’s waiver

and equitable-tolling arguments, applied the relevant

statute of limitations, and correctly dismissed his legal

malpractice claims as untimely; and (4) the court

properly dismissed the fiduciary-duty claims as barred

4 Nos. 09-3118, 09-3221 & 09-3222

by res judicata. As for India’s legal malpractice claim,

we affirm on a ground raised below but not reached by

the district court: There is no evidence to support

India’s contention that her grandparents intended her

to receive more than the estate-plan documents pro-

vide. Accordingly, that claim was properly dismissed,

but it should have been dismissed with prejudice.

I. Background

Tom and Ida Lou Ennenga lived in Freeport, Illinois, and

had an estate worth between $3 and $4 million. Their

daughters, Connie and Lucie, each have three children;

their son, George, has one child—his daughter, India.

Connie’s husband, Byron Starns, is a lawyer; when the

Ennengas decided to revise their estate plan in the

spring of 2000, they turned first to their son-in-law.

Starns referred them to Lowell Stortz, one of his partners

at the Minneapolis law firm of Leonard, Street and

Deinard, P.A. After an initial meeting in April 2000,

the Ennengas retained Stortz. They asked him to work

with their Illinois lawyer Woodruff Burt of the Free-

port firm of Schmelzle & Kroeger. (Burt later moved

to the firm of Snow, Hunter, Whiton & Fishburn, which

was briefly a defendant in this case.)

On May 5, 2000, Stortz sent Burt a letter relaying

the Ennengas’ request and describing his understanding

of how they wanted their estate plan revised. Stortz

asked Burt to carefully review the terms with the

Ennengas. Burt and Stortz spoke on the phone on May 18,

and later that day Burt sent Stortz a letter covering

Nos. 09-3118, 09-3221 & 09-3222 5

the most important terms of the revised plan. Burt asked

Stortz to reconfirm the details with the Ennengas. He did

so, and on May 20 Tom Ennenga sent a letter to Stortz

confirming that the couple’s intent was as Burt described

in his May 18 letter. He said: “We have reviewed the

W.A. Burt letter to you. We believe it outlines our in-

tentions quite clearly.” Stortz then proceeded to draft

the new estate plan in accordance with these instruc-

tions. He sent a proposed draft, along with a detailed

cover letter explaining the plan’s structure, to the

Ennengas and Burt on July 13.

As relevant here, and simplifying somewhat, a

revocable trust agreement divided the Ennengas’ estate

into thirds—one third for each of their children, Connie,

Lucie, and George. From the beginning the Ennengas

told Stortz they were concerned about George’s money-

management skills and wanted to control his access to

the funds in his trust. To that end, the estate plan

limited George’s access to his share of the estate

proceeds by means of a spendthrift trust. As such,

George could not control the assets in his trust or access

the principal except as specified in the trust agreement.

The Ennengas did not, however, have the same con-

cerns about their daughters. The trust agreement gave

Connie and Lucie unlimited access to their trust funds.

The estate plan also contained directions for the dis-

tribution of any trust-fund assets that remained upon

the death of the primary beneficiaries. When George

dies, the remainder of his trust will be divided into

equal shares among all seven of the Ennengas’ living

6 Nos. 09-3118, 09-3221 & 09-3222

grandchildren, including his daughter India, in a per

capita distribution. In contrast, when Connie and Lucie

die, the remainders of their trusts—provided they do not

designate otherwise in their wills—will be divided

among their own children in a per stirpes distribution.

The Ennengas signed the estate-plan documents on

August 9, 2000. Almost two years later, on April 25, 2002,

Tom asked Burt to videotape him discussing his estate

plan. On the videotape Tom stated that the beneficiaries

of his estate were George in a spendthrift trust, Connie’s

three children, and Lucie’s three children. Inexplicably,

Tom did not say anything about Connie, Lucie, or India.

Burt later testified that this omission was an oversight

because he did not prompt Tom to talk about these

heirs on the videotape.

Ida Lou died on May 19, 2004, and Tom died a month

later on June 20. Four days after Tom’s death, the

Ennengas’ estate entered probate in Stephenson County,

Illinois. George and India did not contest the will and trust

documents. Instead they waited about a year and then

sued Starns and Burt in Illinois state court to prevent

the sale of the family home, alleging that George was

promised an option to buy it. The home was sold to a

third party, George and India abandoned the suit, and

a judgment was entered dismissing their case.

In June 2006 George and India brought this suit in

federal court alleging state-law claims for legal mal-

practice and breach of fiduciary duty against Starns,

Nos. 09-3118, 09-3221 & 09-3222 7

Stortz, Burt, and their law firms.1 All of the claims were

initially premised on a conflict-of-interest theory based

on the law-partner relationship between Stortz, who was

primarily responsible for drafting the estate-plan docu-

ments, and Starns, the husband of one of the estate bene-

ficiaries. The defendants moved to dismiss for failure

to state a claim. The district court granted the motion,

holding that under either Illinois’s or Minnesota’s Rules

of Professional Conduct, the representation was not

prohibited. See ILL. R ULES OF P ROF’L C ONDUCT R. 1.8(c);

M INN. R ULES OF P ROF’L C ONDUCT R. 1.8(c).

The court granted leave to amend, and George and

India filed an amended complaint asserting a claim for

legal malpractice based on allegations that the de-

fendants failed to effectuate the Ennengas’ testamentary

intent. Essentially, they claimed that the lawyers negli-

gently drafted the trust agreement. They also asserted

a claim for breach of fiduciary duty against Starns and a

related “aiding and abetting” claim against Burt and

his law firm. These claims were based on allegations

that Starns, as trustee of the estate, wrongfully sold the

family home without giving George the option to pur-

chase it, and that Burt and his law firm were complicit

in Starns’s actions.

The defendants again moved to dismiss for failure to

state a claim, this time arguing that George’s legal mal-

1

Jurisdiction is premised on diversity of citizenship. 28 U.S.C.

§ 1332. George and India Ennenga are citizens of New York.

Starns, Stortz, and their law firm are citizens of Minnesota.

Burt and his law firm are citizens of Illinois.

8 Nos. 09-3118, 09-3221 & 09-3222

practice claim was untimely, and George and India’s

breach-of-fiduciary-duty and aiding-and-abetting claims

were barred by res judicata. George and India responded

in part by arguing that under Rule 12(g)(2) of the Federal

Rules of Civil Procedure, these defenses were waived

because they were not raised in the first motion to dis-

miss. The district court rejected this argument and dis-

missed George’s legal malpractice claim as untimely

and the fiduciary-duty claims as barred by res judicata.

India’s minor status tolled the statute of limitations,

however, so her legal malpractice claim moved forward.

The case proceeded to the summary-judgment stage.

Burt’s law firm—Snow, Hunter, Whiton & Fishburn—

moved for summary judgment, arguing that India’s

claim against it must be dismissed because Burt did not

join the firm until well after the relevant estate-plan

documents were drafted. The court agreed and granted

summary judgment dismissing the firm from the case.2

The remaining defendants also moved for summary

judgment, arguing that India’s claim failed on the merits

or at the very least was premature because her dam-

ages were uncertain and might not ever arise. The

court granted summary judgment on the latter ground.

In short, the court held that if India dies before her

father and aunts, and has no children, or if her father

and aunts deplete their trust funds before they die, India

will receive nothing regardless of the alleged malprac-

2

The plaintiffs do not challenge this part of the district

court’s summary-judgment ruling.

Nos. 09-3118, 09-3221 & 09-3222 9

tice. In other words, until India can take from the

Ennengas’ estate, any damages are speculative. At

India’s request the court amended the judgment to

clarify that her legal malpractice claim was dismissed

without prejudice.

George and India appealed from the following orders:

(1) the district court’s order dismissing with prejudice

all but India’s malpractice claim; (2) the order granting

summary judgment for Starns, Stortz, their law firm, and

Burt on India’s malpractice claim; and (3) the final order

amending the judgment to clarify that the dismissal of

India’s malpractice claim was without prejudice. The

defendants filed a cross-appeal seeking review of the

last two orders, arguing that India’s malpractice claim

should have been dismissed with prejudice.

II. Discussion

A. Appellate Jurisdiction

Because the district court dismissed India’s legal mal-

practice claim without prejudice, we begin by addressing

appellate jurisdiction. See Mostly Memories, Inc. v. For

Your Ease Only, Inc., 526 F.3d 1093, 1097 (7th Cir. 2008)

(“A court of appeals has an obligation to examine its

jurisdiction sua sponte, even if the parties fail to raise a

jurisdictional issue.” (quotation marks omitted)). “Nor-

mally, a dismissal without prejudice is not a final order

for purposes of appellate jurisdiction under 28 U.S.C.

§ 1291.” Doss v. Clearwater Title Co., 551 F.3d 634, 639

(7th Cir. 2008) (quotation marks omitted). There is a

recognized exception, however, when the district court

10 Nos. 09-3118, 09-3221 & 09-3222

makes it clear that it is “finished with th[e] case once

and for all.” Id.; see also Mostly Memories, 526 F.3d at

1097; Hill v. Potter, 352 F.3d 1142, 1144-45 (7th Cir. 2003).

In its summary-judgment order dismissing India’s

malpractice claim, the court said it was “closing” the

case. The judge explained that the question of India’s

damages may be uncertain for quite some time—essen-

tially, until her father and aunts die. The judge later

amended the judgment to specify that the dismissal was

without prejudice. This order, too, said the case was

“closed” and gives no indication that the judge expects

or would entertain an amended complaint. It’s clear the

district court is “finished with th[e] case once and for

all,” Doss, 551 F.3d at 639, and we have appellate juris-

diction.

B. George Ennenga’s Legal Malpractice Claim

In their amended complaint, George and India alleged

that Starns, Stortz, and Burt committed legal malpractice

by failing to properly effectuate Tom and Ida Lou’s testa-

mentary intent. The defendants moved to dismiss

George’s claim as untimely. (As we have noted, India’s

minority status tolled the statute of limitations.) It is

undisputed that George, an intended beneficiary of the

Ennengas’ estate, is a proper plaintiff here. See McLane

v. Russell, 546 N.E.2d 499, 503-04 (Ill. 1989). The question

for us is whether the district court correctly dismissed

his malpractice claim because it was filed outside the

applicable limitations period. George challenges this

ruling on multiple fronts.

Nos. 09-3118, 09-3221 & 09-3222 11

First, he contends that the defendants waived the stat-

ute-of-limitations defense by not raising it in their

first motion to dismiss. This argument is based on a

misreading of Rule 12(g)(2) of the Federal Rules of Civil

Procedure. That rule requires litigants to consolidate

certain dismissal arguments in a single motion, but it

also contains some important exceptions: “Except as

provided in Rule 12(h)(2) or (3), a party that makes a

motion under this rule must not make another motion

under this rule raising a defense or objection that

was available to the party but omitted from its earlier

motion.” The exception at issue here—contained in

Rule 12(h)(2)—makes it clear that a litigant need not

consolidate all failure-to-state-a-claim arguments in a

single dismissal motion: “Failure to state a claim upon

which relief can be granted . . . may be raised: (A) in any

pleading allowed or ordered under Rule 7(a); (B) by a

motion under Rule 12(c); or (C) at trial.” FED. R. C IV.

P. 12(h)(2).

The district court noted that a motion to dismiss on

statute-of-limitations grounds qualifies as a motion to

dismiss for failure to state a claim. See Small v. Chao,

398 F.3d 894, 898 (7th Cir. 2005) (“[A] district court

may dismiss under Rule 12(b)(6) something that is indis-

putably time-barred . . . .”). As such, the court held that

the Rule 12(h)(2) exception applied and the defendants’

failure to raise the statute-of-limitations defense in

their earlier Rule 12(b)(6) motion was not a waiver.

This ruling was sound. Rule 12(g)(2) does not prohibit

a new Rule 12(b)(6) argument from being raised in

12 Nos. 09-3118, 09-3221 & 09-3222

a successive motion. Stated differently, Rule 12(h)(2)

specifically excepts failure-to-state-a-claim defenses

from the Rule 12(g) consolidation requirement. The

policy behind Rule 12(g) is to prevent piecemeal litiga-

tion in which a defendant moves to dismiss on one

ground, loses, then files a second motion on another

ground. See Pilgrim Badge & Label Corp. v. Barrios, 857

F.2d 1, 3 (1st Cir. 1988). Rule 12(h)(1) enforces this con-

solidation requirement by adding a waiver rule: “A

party waives any defense listed in Rule 12(b)(2)-(5) by . . .

omitting it from a motion in the circumstances described

in Rule 12(g)(2)” or by failing to preserve it “by motion

under this rule” or “in a responsive pleading or in an

amendment allowed by Rule 15(a)(1) as a matter of

course.” FED. R. C IV. P. 12(h)(1). Note the limitation,

however. The Rule 12(h)(1) waiver rule applies only to

the defenses listed in Rule 12(b)(2)-(5) (lack of personal

jurisdiction, improper venue, insufficient process, and

insufficient service of process). Failure-to-state-a-claim

defenses are thus excepted from the Rule 12(g)(2) con-

solidation requirement and not included in the

Rule 12(g)(1) waiver rule.

And on the specific point raised here, we have

held—albeit without much analysis—that a statute-of-

limitations defense is not waived if raised for the first

time in a successive motion to dismiss. Perry v. Sullivan,

207 F.3d 379, 381-83 (7th Cir. 2000). George argues that

Perry is distinguishable because the plaintiff there con-

ceded that the statute of limitations had run. That dis-

tinction goes to the merits of the defense, not whether

the defense is waived.

Nos. 09-3118, 09-3221 & 09-3222 13

George also contends that the statute-of-limitations

defense was not properly raised in a motion to dismiss

because the defense was not plain on the face of the

complaint. The district court rejected this argument,

holding that the issue could be resolved at the motion-to-

dismiss stage based on the allegations in the com-

plaint and a few undisputable facts within its judicial-

notice power—specifically, the date on which the

estate entered probate and the deadline for filing a

claim within the probate proceeding.

This decision, too, was sound. Taking judicial notice

of matters of public record need not convert a motion

to dismiss into a motion for summary judgment. See Doss,

551 F.3d at 640 (citing F ED . R. C IV. P. 12(d)). A court may

take judicial notice of facts that are (1) not subject to

reasonable dispute and (2) either generally known

within the territorial jurisdiction or capable of ac-

curate and ready determination through sources whose

accuracy cannot be questioned. Gen. Elec. Capital Corp. v.

Lease Resolution Corp., 128 F.3d 1074, 1081 (7th Cir. 1997).

Here, the court took judicial notice of the dates on

which certain actions were taken or were required to

be taken in the earlier state-court litigation—facts

readily ascertainable from the public court record and

not subject to reasonable dispute. See Henson v. CSC

Credit Servs., 29 F.3d 280, 284 (7th Cir. 1994) (finding

public court documents judicially noticeable).

Having cleared these hurdles, we now arrive at the

merits of the statute-of-limitations defense. George

first argues that the district court should have applied

14 Nos. 09-3118, 09-3221 & 09-3222

Minnesota’s statute of limitations, not Illinois’s, because

Starns and Stortz reside and practice law in Minnesota,

and their firm is a Minnesota law firm. The district

court evaluated the choice-of-law issue under the

“most significant contacts” test and held that Illinois

law applied.

This holding was correct, although a “significant con-

tacts” analysis was ultimately unnecessary. Illinois

choice-of-law rules apply. Kalmich v. Bruno, 553 F.2d 549,

552 (7th Cir. 1977). The district court correctly noted that

Illinois courts apply the “most significant contacts” test

from the Restatement (Second) of Conflict of Laws, which

involves balancing a number of factors, including the

place where the injury occurred; the place where the

conduct causing the injury occurred; the domicile or

place of business of each party; and the place where

the relationship between the parties is centered.

Wreglesworth ex rel. Wreglesworth v. Arctco, Inc., 738 N.E.2d

964, 971 (Ill. App. Ct. 2000).

However, the Restatement also contains a strong pre-

sumption that the forum state will apply its own statute

of limitations. See R ESTATEMENT (SECOND) OF C ONFLICT

OF L AWS § 142 (“An action will not be maintained if it

is barred by the statute of limitations of the forum, in-

cluding a provision borrowing the statute of limitations

of another state.”). Illinois courts have adopted this

presumption. See Belleville Toyota, Inc. v. Toyota Motor Sales,

USA, Inc. 770 N.E.2d 177, 194 (Ill. 2002); Emp’rs Ins. of

Wausau v. Ehlco Liquidating Trust, 723 N.E.2d 687, 692-93

(Ill. App. Ct. 1999). Thus, even when the substantive law

Nos. 09-3118, 09-3221 & 09-3222 15

of a nonforum state applies, Illinois courts apply the

Illinois statute of limitations “because statutes of limita-

tions are procedural, fixing the time in which the

remedy for a wrong may be sought rather than altering

substantive rights.” 3 Freeman v. Williamson, 890 N.E.2d

1127, 1133 (Ill. App. Ct. 2008). Accordingly, the district

court properly applied Illinois’s statute of limitations

rather than Minnesota’s.

George next argues that the statute-of-limitations

defense could not be decided on a motion to dismiss

because he raised a claim of equitable tolling based on

3

The Illinois “borrowing statute” is an exception to this rule,

but it has very limited application. The borrowing statute

provides that “[w]hen a cause of action has arisen in a state

or territory out of this State, or in a foreign country, and, by

the laws thereof, an action thereon cannot be maintained by

reason of the lapse of time, an action thereon shall not be

maintained in this State.” 735 I LL . C OMP . S TAT . 5/13-210. An

additional judicially created condition narrows the borrowing

statute even further: “[A]ll parties [must] be non-Illinois

residents at the time the action accrued and until the limita-

tions laws of the foreign state runs.” Emp’rs Ins. of Wausau v.

Ehlco Liquidating Trust, 723 N.E.2d 687, 693 (Ill. App. Ct. 1999).

Thus, the Illinois courts have held that the borrowing

statute applies only “where (1) the cause of action accrued

in another jurisdiction; (2) the limitations period of that juris-

diction has expired; and (3) all parties were non-Illinois resi-

dents at the time the action accrued and remained so until

the foreign limitations period expired.” Newell Co. v. Petersen,

758 N.E.2d 903, 908 (Ill. App. Ct. 2001). The Illinois bor-

rowing statute is not relevant here.

16 Nos. 09-3118, 09-3221 & 09-3222

a fraudulent-concealment theory. This argument also

fails. George’s equitable-tolling argument is based on an

email he inadvertently received from Burt on August 8,

2004.4 As we will explain in more detail in a moment,

under the applicable statute of limitations, the limitations

period began to run on June 24, 2004, and ended on

January 1, 2005. Accordingly, George knew the facts on

which he bases his equitable-tolling claim well before

the limitations period expired.

In Illinois, courts will not equitably toll a statute

of limitations based on a claim of fraudulent conceal-

ment “if the plaintiff discovers the fraudulent con-

cealment and a reasonable time remains within the rele-

vant limitations period . . . .” Barratt v. Goldberg, 694 N.E.2d

604, 609 (Ill. App. Ct. 1998) (citing Anderson v. Wagner,

402 N.E.2d 560 (Ill. 1979)). Here, George discovered

the facts underlying his claim of fraudulent conceal-

ment with almost five months left on the limitations

clock. The district court correctly held that this was a

reasonable time within which to comply with the stat-

ute of limitations. We agree that equitable tolling

does not apply.

George brings a claim of legal malpractice arising

from the preparation of an estate plan. Illinois has estab-

lished the following time limit for this particular kind

of professional malpractice claim:

When the injury caused by the act or omission does not

occur until the death of the person for whom the

4

A copy of the email is attached to the amended complaint.

Nos. 09-3118, 09-3221 & 09-3222 17

professional services were rendered, the action may

be commenced within 2 years after the date of the

person’s death unless letters of office are issued or

the person’s will is admitted to probate within that

2 year period, in which case the action must be com-

menced within the time for filing claims against

the estate or a petition contesting the validity of the

will of the deceased person, whichever is later, as

provided in the Probate Act of 1975.735 ILL. C OMP.

S TAT. 5/13-214.3(d).5 Any injury to George occurred

upon the death of his father, “the person for whom

the professional services were rendered.” It was at

this point that the terms of the trust agreement

took effect. The two-year statute of limitations pre-

scribed by section 5/13-214.3(d) therefore displaces

the more generally applicable six-year limitations

period. See id. 5/13-214.3(b)-(d).

However, because Tom Ennenga’s will was admitted

to probate within the two-year statutory period, the time

limit was shortened even further. George was required

5

George suggests that section 5/13-214.3(d) is invalid. The

statute does have an unusual history. The Illinois legislature

repealed it as part of a massive tort-reform effort. But the entire

reform act was later held unconstitutional by the Illinois

Supreme Court. See Best v. Taylor Mach. Works, 689 N.E.2d 1057,

1064 (Ill. 1997). In other words, the tort-reform bill killed

this particular statute of limitations, but the bill’s invalida-

tion brought the limitations provision back to life. The Illinois

Supreme Court enforces the provision in attorney malpractice

cases. See, e.g., Wackrow v. Niemi, 899 N.E.2d 273, 276-77

(Ill. 2008).

18 Nos. 09-3118, 09-3221 & 09-3222

to file his malpractice claim “within the time limit for

filing claims against the estate or a petition contesting

the validity of the will . . . whichever is later.” Id. 5/13-

214.3(d). The statutory period for a will contest is six

months after the will is admitted to probate. 755 ILL. C OMP.

S TAT. 5/8-1(a). Tom Ennenga’s will was admitted to

probate on June 24, 2004, so the will-contest period ex-

tended to December 24, 2004. But the claims notice in

connection with the probate proceeding set a later claim-

filing deadline—January 1, 2005—making that date the

deadline for George’s malpractice claim. George did not

file this suit until June 2006. Accordingly, the district

court correctly held that his malpractice claim was un-

timely.

C. Breach of Fiduciary Duty/Aiding and Abetting

George and India also alleged that Starns, as the

trustee of Tom and Ida Lou’s trust, breached his

fiduciary duty by selling the family home, a piece of trust

property, to a third party without first giving George

the option to buy it. They asserted a derivative claim

against Burt for aiding and abetting this alleged

fiduciary breach. The district court held that these inter-

related fiduciary-duty claims are barred by res judicata.6

6

George and India repeat their waiver argument in connection

with the res judicata defense, claiming that the defendants

waived res judicata by not raising it in their first motion to

dismiss. Again, we disagree. Like a statute-of-limitations

defense, res judicata may be brought in a Rule 12(b)(6) motion

(continued...)

Nos. 09-3118, 09-3221 & 09-3222 19

Res judicata applies if there is (1) a final judgment on

the merits in an earlier action; (2) an identity of the

causes of action; and (3) an identity of parties or their

privies. River Park, Inc. v. City of Highland Park, 703

N.E.2d 883, 889 (Ill. 1998). All three requirements are

satisfied here. The parties are identical. The state-court

suit pitted George and India against Starns and Burt,

and the federal suit pits George and India against

Starns, Burt, and Burt’s law firm, with which he was in

privity at the time the house was sold. See Purmal v.

Robert N. Wadington & Assocs., 820 N.E.2d 86, 94-95 (Ill.

App. Ct. 2004). The causes of action share a common

identity in that they “arise from a single group of opera-

tive facts.” River Park, 703 N.E.2d at 893. Here, as in the

state-court litigation, George and India allege that

Starns had a duty to offer George the option to buy the

Ennenga family home before selling it to a third party.

6

(...continued)

for failure to state a claim, Muhammad v. Oliver, 547 F.3d

874, 878 (7th Cir. 2008), which is exempt from Rule

12(h)(2)’s consolidation requirement and is not subject to

Rule 12(h)(1)’s waiver rule. See, e.g., Diaz-Buxo v. Trias Monge,

593 F.2d 153, 154-55 (1st Cir. 1979) (permitting res judicata

defense raised for the first time in a second motion to

dismiss despite a Rule 12(g) argument where there was no

prejudice to plaintiff). George and India also reiterate their

argument that the defense cannot be resolved on a motion

to dismiss. Like the statute-of-limitations defense, however,

all the facts relevant to the res judicata defense are ascer-

tainable from the second amended complaint and judicially

noticeable records from the state-court case. See Henson v.

CSC Credit Servs., 29 F.3d 280, 284 (7th Cir. 1994).

20 Nos. 09-3118, 09-3221 & 09-3222

Finally, the state court dismissed George and India’s case

for failure to state a claim after the home was sold and

they abandoned their claim. This was a final judgment

on the merits. See ILL. S UP. C T. R. 273 (“Unless . . .

otherwise specifie[d], an involuntary dismissal of an

action, other than a dismissal for lack of jurisdiction,

for improper venue, or for failure to join an indis-

pensable party, operates as an adjudication upon

the merits.”).

George and India insist that their state-court action

for equitable relief cannot preclude this federal action for

money damages because the former did not give them

access to a jury. For support they rely on Weisman

v. Schiller, Ducanto & Fleck, 733 N.E.2d 818 (Ill. App. Ct.

2000), but that case is inapplicable. Weisman involved a

law firm’s petition under the Illinois Marriage and Dis-

solution of Marriage Act to recover fees for services

rendered in a client’s divorce. Id. at 820. To avoid

paying the legal fees, the client alleged that the lawyer

had been negligent. Id. In a later suit for legal malprac-

tice, the Illinois Appellate Court held that although

the elements of res judicata were technically met, the

second suit was not precluded. Id. at 820-21. The

court gave two reasons. First, the client could not

have counterclaimed for legal malpractice in the fee-

petition action because the court lacked subject-matter

jurisdiction to entertain such a claim. Id. at 821. Second,

because the Illinois Marriage Dissolution Act explicitly

bars jury trials, 750 ILL. C OMP . S TAT. 5/103, applying

res judicata would have denied the client a funda-

mental right under the Illinois constitution, Weisman,

733 N.E.2d at 821-22.

Nos. 09-3118, 09-3221 & 09-3222 21

Neither of these reasons applies here. George and

India could have litigated their substantive arguments

in full in the original state-court action. They were free

to assert their claims for breach of fiduciary duty and

seek money damages in that case; had they done so, they

would have had access to a jury. Here, in contrast to

Weisman, there was no jurisdictional impediment to

suit or statutory bar to a jury trial.

Because all the elements of res judicata are met, and

George and India could have raised their fiduciary-

duty claims in their state-court action, the district court

correctly held that they were precluded from doing

so here. See Chi. Title Land Trust Co. v. Potash Corp., 664 F.3d

1075, 1080 (7th Cir. 2011) (“[I]f the three elements

necessary to invoke res judicata are present, res judicata

will bar not only every matter that was actually deter-

mined in the first suit, but also every matter that might

have been raised and determined in that suit.”) (applying

Illinois law).

D. The Cross-Appeal

The district court dismissed India’s malpractice claim

at the summary-judgment stage, holding that because

her damages are speculative and might never arise,

her claim is premature. George and India appealed

from this ruling. At India’s request the court later

amended the judgment to clarify that the dismissal was

without prejudice. The cross-appeal by Starns, Stortz,

their law firm, and Burt challenges this aspect of the

judgment. They argue that the court should have

22 Nos. 09-3118, 09-3221 & 09-3222

dismissed India’s malpractice claim with prejudice

because India has no evidence to support her claim that

they committed legal malpractice. We agree. Accordingly,

we resolve this issue on alternative grounds—fully pre-

served in the district court—and do not address the

district court’s prematurity ruling. See Estate of Suskovich

v. Anthem Health Plans of Va., Inc., 553 F.3d 559, 572 (7th

Cir. 2009) (“[We] can affirm summary judgment on any

non-waived ground, even if the district court did not

address it.”).

“Summary judgment is proper when there is no

genuine issue of material fact and the moving party is

entitled to judgment as a matter of law.” Siliven v. Ind.

Dep’t of Child Serv., 635 F.3d 921, 925 (7th Cir. 2011) (citing

F ED. R. C IV. P. 56(c)). To prevail on a legal negligence

claim under Illinois law, India must prove “the existence

of a duty owed by the defendant to the plaintiff, a

breach of that duty, and an injury proximately resulting

from the breach.” 7 Pelham v. Griesheimer, 440 N.E.2d 96,

98 (Ill. 1982).

7

An attorney-client relationship “is not an indispensable

prerequisite to establishing a duty of care between a non-client

and an attorney” as long as “the intent of the client to benefit

the nonclient third party was the primary or direct purpose

of the transaction or relationship.” Pelham v. Griesheimer,

440 N.E.2d 96, 99 (Ill. 1982). It is undisputed that the

Ennengas intended their revised estate plan to benefit their

children and grandchildren, including India. See McLane v.

Russell, 546 N.E.2d 499, 503-04 (Ill. 1989) (finding the Pelham

test met for an intended beneficiary under a will).

Nos. 09-3118, 09-3221 & 09-3222 23

India’s theory of malpractice is that the Ennengas

intended each of their seven grandchildren to take an

equal share of their estate after their primary bene-

ficiaries died, but the lawyers negligently drafted the

estate plan contrary to that intent. Under terms of the

trust agreement, each grandchild will receive one-

seventh of the remainder of George’s trust, but India’s

six cousins might receive more from their mothers’

trusts during their lifetimes or when their mothers die.

The question here is whether this unequal treatment

violates the Ennengas’ testamentary intent.

We begin by “examining the entire trust and . . .

giving . . . the words employed their plain and ordinary

meaning.” Harris Trust & Sav. Bank v. Donovan, 582 N.E.2d

120, 123 (Ill. 1991). The terms of the trust agreement

are clear and unambiguous. Section 8.B.2.c provides:

At GEORGE ENNENGA’s death, or if he prede-

ceases the survivor of my spouse and me, the Trustee

shall divide GEORGE’S TRUST into as many equal

shares as shall be necessary to allocate one trust

share for the benefit of each grandchild of mine who

is then living, and one trust share for the benefit

of the then living issue, collectively, of a deceased

grandchild of mine . . . .

Section 8.B.3.c provides:

Upon the death of [Connie or Lucie], the Trustee

shall distribute the then remaining balance of her

trust as follows:

8.B.3.c.i. The Trustee shall pay to or apply di-

rectly for the benefit of the surviving spouse or

24 Nos. 09-3118, 09-3221 & 09-3222

issue of such child . . . such amounts from the

principal of her trust as such child shall designate

by her Will . . . .

8.B.3.c.ii. After making the distributions, if any,

required under the preceding subparagraph, the

Trustee shall distribute the balance of such

child’s trust to her surviving issue . . . .

The agreement is signed by the Ennengas, and there are

no allegations of undue influence or duress. As such, it is

the clearest and most reliable expression of their intent.

India does not dispute that the terms of the trust agree-

ment are clear. Instead, she relies on extrinsic evidence

to argue that her grandparents intended otherwise. In

most cases extrinsic evidence is admissible only if the

terms of a trust are ambiguous. See Altenheim German

Home v. Bank of Am., N.A., 875 N.E.2d 1172, 1177 (Ill. App.

Ct. 2007). But legal malpractice cases are an exception

under Illinois caselaw. See Ogle v. Fuiten, 445 N.E.2d

1344, 1347 (Ill. App. Ct. 1983) (contrasting will-construc-

tion suits with legal malpractice claims for negligently

drafting a will).

This makes sense. The focus of the inquiry in this kind

of legal malpractice claim is whether the attorney negli-

gently drafted the relevant estate-plan documents. Ex-

trinsic evidence that conflicts with the terms of the agree-

ment will generally form the basis of the plaintiff’s claim.

And because the claim seeks damages from the attorney,

Ogle v. Fuiten, 466 N.E.2d 224, 227 (Ill. 1984), the use of

extrinsic evidence to determine the client’s intent does

not risk “modify[ing] the document or creat[ing] new

Nos. 09-3118, 09-3221 & 09-3222 25

terms” where “the language of a document is clear,”

Peck v. Froehlich, 853 N.E.2d 927, 934 (Ill. App. Ct. 2006).

Extrinsic evidence of the Ennengas’ intent is thus ad-

missible. Even so, India faces a steep hurdle in chal-

lenging the unambiguous terms of the signed trust agree-

ment.

The primary evidentiary battleground is the corres-

pondence between the attorneys and their notes

predating the Ennengas’ execution of the trust agree-

ment. India relies primarily on three specific items

of evidence. The first is a handwritten note by Stortz

from his first meeting with the Ennengas: “Goal = on

children’s Deaths, make sure all grandchildren treated

equally.” The second is a sentence from Stortz’s May 5

letter to Burt: “Because they now have seven grandchil-

dren, they would like each grandchild to ultimately

receive or benefit from 1/7 of the estate (either as a

direct gift if their parents have died, or as an indirect

result of inheritance by their parents).” And the third is

a notation in Burt’s billing records from May 9: “Grand-

children per capita?” India claims that this evidence

demonstrates that her grandparents were considering

an arrangement whereby each grandchild would be

treated equally and would take per capita from his or

her respective parent’s trust.

At first blush, and considered in isolation, these

discrete pieces of evidence might appear to support

India’s theory. But these items of evidence must be con-

sidered in context and in light of other evidence

that convincingly shows the Ennengas’ intent was

precisely as the trust agreement provides. For example:

26 Nos. 09-3118, 09-3221 & 09-3222

• The handwritten notes from Stortz’s initial meeting

with the Ennengas in April 2000 state: “On George’s

Death, Split among grandchildren equally,” and

“George’s Full GST plan; On his death, amount equal

to 1/7 to her (George may have other children).”

• The May 5 letter from Stortz to Burt describing the

initial meeting states:

George has one daughter, India, who according to

Tom and Ida Lou will be well provided for by her

mother’s parents. As a result, Tom and Ida Lou

would like the trust held for George, following

George’s death, to be distributed in part to India

and the balance in equal shares to their other

grandchildren.

• The May 18 letter from Burt to Stortz states:

“George’s share is to remain in trust for his life. . . .

Upon his death, the remaining principal and undis-

tributed net income are to be divided, per capita,

among the Settlors’ grandchildren.”

• The May 20 letter from Tom Ennenga to Stortz

confirms that Burt’s May 18 letter accurately states

his and his wife’s intent.

• Stortz’s June 21 memo to file states: “On George’s

death, his share will be split equally among the

grandchildren of Thomas and Ida Lou Ennenga . . . .”

• Stortz’s July 13 letter to the Ennengas, with the

final will and trust documents attached, sum-

marizes the documents over several detailed pages.

The letter states: “At George’s death, his trust will

Nos. 09-3118, 09-3221 & 09-3222 27

be divided into equal shares, one share for each of

your grandchildren . . . .” It then describes the gifts

to George’s sisters: “For Connie and Lucie’s shares,

any remaining amounts exempt from GST Tax will

be held in trust during their lifetimes. At each child’s

death, their respective GST Trusts will be divided

among their children . . . .”

The trust documents are fully consistent with this

extrinsic evidence of the Ennengas’ intent. And this

evidence also provides important interpretive context

for each of the three specific notations on which India

relies to support her claim. For example, immediately

following Stortz’s notation “Goal = on children’s Deaths,

make sure all grandchildren treated equally” is this

statement: “On his death, amount equal to 1/7 to her

(George may have other children).” The second state-

ment thus qualifies the first and confirms that the

Ennengas’ goal was to treat all grandchildren equally in

the distribution of George’s trust.

Similarly, in Stortz’s May 5 letter, immediately before

his statement that the Ennengas “would like each grand-

child to ultimately receive or benefit from 1/7 of the

estate,” Stortz wrote as follows:

George has one daughter, India, who according to

the Ennengas will be well provided for by her

mother’s parents. As a result, Tom and Ida Lou

would like the trust held for George, following

George’s death, to be distributed in part to India

and the balance in equal shares to their other

grandchildren.

28 Nos. 09-3118, 09-3221 & 09-3222

Again, reading these passages together clarifies that

Stortz was making a record of the Ennengas’ instructions

regarding the distribution of the remainder of George’s

trust. It also explains why the Ennengas were not con-

cerned with giving India only one-seventh of her

father’s trust, while the other grandchildren might even-

tually take more from their mothers—they understood

that she would be well provided for by her other grand-

parents.

Finally, the passage in Burt’s May 18 letter stating

that “[u]pon [George’s] death, the remaining principal

and undistributed net income are to be divided, per

capita, among the Settlors’ grandchildren,” explains the

earlier, cryptic notation in Burt’s billing records that

inquires, “Grandchildren per capita?” Considered

together, and in light of the other evidence of the

Ennengas’ intent, this billing-record notation can only

be understood as a query about how the remainder of

George’s trust was to be distributed.

It’s worth noting that other than asserting that

the Ennengas generally intended each grandchild to

take one-seventh of the estate, India has not been clear

about what precise remainder scheme her grandparents

intended. At times she suggests the Ennengas wanted

any remainder of Lucie’s and Connie’s trusts to be

divided among all the grandchildren. But the record

contains no evidence whatsoever to support that con-

tention. At other times she suggests that her grand-

parents intended her to receive the full remainder of

her father’s trust—that is, that all the trusts were to be

Nos. 09-3118, 09-3221 & 09-3222 29

distributed per stirpes. Although such an arrangement

serves an abstract idea of equal treatment, it does not

align with the goal—the one she supposes her grand-

parents intended—that each grandchild receive one-

seventh of the estate. Indeed, because India is George’s

only child and the spendthrift controls on his trust

make it more likely that trust assets will remain when

he dies, structuring the estate plan in this way would

likely result in India taking much more than a one-

seventh share.

Although India makes much of it, the video of Tom

Ennenga discussing his estate plan adds nothing to

the analysis. On the tape Tom never mentions India

or meaningfully discusses how the grandchildren

would take under the trust scheme. His reference to the

beneficiaries of his estate mentions only George and

Connie’s and Lucie’s children. As importantly, the video

was filmed two years after the execution of the trust

agreement. The temporal focus here is on Tom and Ida

Lou’s intent when they signed the trust agreement. The

video sheds little light on that question.

Finally, the report of India’s expert is not enough to

forestall summary judgment. India emphasizes her

expert’s interpretation of the attorneys’ correspondence

and meeting notes. For example, the expert states: “[W]e

know that Tom and Ida Lou’s goal was rough equality

among all grandchildren, with some grandchildren re-

ceiving their shares directly, while others receiving

them by inheritance from their parents.” This is not a

statement of expert opinion; it is speculation about the

ultimate issue of fact, which is insufficient to avoid sum-

30 Nos. 09-3118, 09-3221 & 09-3222

mary judgment. See Weigel v. Target Stores, 122 F.3d 461,

469 (7th Cir. 1997) (“A party cannot assure himself of a

trial merely by trotting out in response to a motion for

summary judgment his expert’s naked conclusion

about the ultimate issue.” (quotation marks omitted)).

True, India’s expert offers an opinion that the trust agree-

ment was irregular. This is perhaps more squarely

within his role, but it is beside the point. The evidence

establishes that the more unusual elements of the trust

scheme—e.g., the restrictive terms of George’s trust as

compared to those of his sisters, and the distribution of

the remainder of George’s trust among all seven grand-

children—were exactly what the Ennengas intended.

In sum, India lacks evidence to support her claim

that Stortz, Starns, or Burt breached their duty of care

by drafting the Ennengas’ estate plan in violation of

their intent. Accordingly, India’s legal malpractice claim

should have been dismissed with prejudice.

III. Conclusion

For the foregoing reasons, we A FFIRM the district

court’s dismissal of George’s legal malpractice claim

as time-barred. We also A FFIRM the dismissal of the

fiduciary-duty claims as barred by res judicata. Finally,

we A FFIRM the dismissal of India’s legal malpractice

claim on other grounds and R EMAND with instructions

to modify the judgment to reflect that the claim is dis-

missed with prejudice, consistent with this opinion.

4-17-12