The Illinois Supreme Court soon will decide whether a lawyer's business practice is subject to the same consumer protection laws as car dealers and telemarketers. Lawyers found liable under the Illinois Consumer Fraud Act could be hit with punitive damages and attorney fees.

Last year, an Illinois appeals court ruled that deceptive billing practice allegations "fall within the commercial aspects of the legal profession and do not involve the actual practice of law." (Cripe v. Leiter, 683 N.E.2d 514 (I11. App. Ct.1997).)

On May 10, the high court heard oral arguments in the case, which alleges fraudulent overbilling of a client. The dispute sprang from a family feud involving Roberta Schmitz, an elderly woman who inherited two irrevocable trusts when her husband died in 1992. She hired a Peoria attorney, Thomas Leiter, to help her administer the trusts.

Soon after Schmitz came into the inheritance, some of her seven children tried to have her declared incompetent. Leiter sought a stay-away order for her and defended her in a competency proceeding, but her children continued to fight over her guardianship for several years. Schmitz retained Leiter as her lawyer during that time.

Eventually, Schmitz moved to Michigan, where the familial legal wrangling continued. A court appointed a daughter, Roberta Cripe, as Schmitz's legal guardian and conservator of her estate. Cripe was one of the children who had tried to have Schmitz declared incompetent in the Illinois proceeding. When Cripe totaled up her mother's outstanding legal bills, she sued Leiter, contending his fees of $65,000 were inflated by about $40,000.

Leiter's attorney, David Sinn of Peoria said the fees were justified "because of the extra work the children's squabbling collectively generated."

But the facts in the case quickly took a backseat to the issue of law it raised: specifically, whether Leiter could be sued under the state's consumer fraud act. A trial court found he could not be, but the appeals court reversed.

In reaching its ruling, the appeals court relied on Gadson v. Newman, in which a federal district court adopted a distinction between the actual practice of law and the entrepreneurial aspect of the profession. Gadson held that the "business aspects" of the profession are subject to liability under the consumer fraud act, but claims involving the "actual" practice of law are not. (807 E Supp.1412,1417 (C.D. I11.1992).)

Cripe's attorney, Bradley McMillan of Peoria, argued that the only skills required in billing are the ability to tell time and accurately report the time spent performing legal services.

Dennis Rendleman, general counsel of the Illinois State Bar Association, said his group disagrees with the way the consumer fraud act argument is applied to attorneys and filed an amicus curiae brief in the case.

Rendleman said the legal issue before the supreme court is "whether the practice of law can be separated from the business of practicing law." The bar association believes it cannot be, he said.

In its amicus brief, the association also argued that applying the consumer protection law to lawyers violates the separation of powers outlined in the state constitution. Under Illinois law, the supreme court regulates the practice of law.

"Illinois lawyers are already required to adhere to the state's Rules of Professional Responsibility," Rendleman said. "And the Attorney Registration and Disciplinary Commission supervises their conduct."

According to Rendleman, the state of Illinois's lawyer disciplinary system aggressively investigates allegations of attorney misconduct, negating the need for legislative oversight.

"But even if oversight were warranted, we would argue that the legislature never intended the consumer fraud act to apply to lawyers but to buyer-seller transactions where consumers have no other remedy available to them," he said.

McMillan, the Peoria lawyer who filed the novel claim on Cripe's behalf, disagrees. "Lawyers should not be allowed to do business under a different set of rules than other professionals," he said.

McMillan said the idea to use the consumer fraud act stemmed from his past work defending insurance companies that were subject to its provisions. Still, the idea of suing a fellow attorney under the law "was something I thought long and hard about doing," McMillan said. "But I've been pleasantly surprised by the amount of support I have received from lawyers and some attomey groups."

Another proponent is James Turner, executive director of HALT, a Washington, D.C.-based legal advocacy group for consumers. "No lawyer worth his or her salt has any problem meeting the standards of consumer protection laws like this one," he said. "Ethical lawyers have nothing to fear, and, in fact, the trial bar would be much better served by agreeing to clean house this way." HALT has also filed an amicus brief in the case.

The state supreme court is expected to issue a ruling in the case in late summer or early fall.