Illinois law invalidating a settlement agreement
Pros and Cons As with most decisions, there are pros and cons to electing arbitration over traditional litigation.
Although the parties are required to pay up-front administrative fees and the arbitrator’s (or arbitrators’) hourly rate, the overall cost of arbitration from filing through resolution should be less because discovery and motion practice typically are limited.Second, the arbitration provision cannot limit the liability to which the lawyer would otherwise be exposed under common or statutory law unless the client is independently represented in making the agreement. In both cases, the courts held that arbitration clauses related to attorney malpractice claims are enforceable in Illinois.While these guidelines generally apply, a lawyer should check state-specific rules and decisions before deciding to include such a provision in a retainer agreement. Similarly, the American Bar Association Standing Committee on Ethics and Professional Responsibility issued Formal Opinion 02-425, finding that retainer agreements that require binding arbitration are permissible under the Model Rules of Professional Conduct provided certain conditions are met.Some insurers have issued advisory opinions about this issue that may offer valuable insight to the attorney.It is best practice to get written consent from an insurer before deciding to include an arbitration clause that covers malpractice claims in a retainer agreement.