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September 2026 IICLE FLASHPOINTS

FLASHPOINTS

Complimentary monthly legal update

September 2026 Edition

Current legal updates across Illinois practice areas.

September 2026 focus areas

Select a story card to open that update in the reader.

Corporate & Commercial Unpaid Commissions, Written Contracts, and the Limits of Business Torts Paul B. Porvaznik Bielski Chapman, Ltd., Chicago
Ethics We Are Lawyers . . . AI Is Not Hal R. Morris Saul Ewing LLP, Chicago
Criminal Second District Upholds Pretrial Release Revocation Despite Missed Arraignment Matthew R. Leisten Ogle County State’s Attorney’s Office, Oregon
Family Appellate Guidance on School Choice, Maintenance Enforcement, and Child Support Michelle A. Lawless Law Office of Michelle A. Lawless LLC, Chicago
Government Promissory Estoppel or Quantum Meruit Cannot Be Pleaded Based Only on Alleged Oral Promise of City Employee Laura M. Julien Mickey, Wilson, Weiler, Renzi, Lenert & Julien, P.C., Sugar Grove
Real Estate Declaration Did Not Grant Commercial Owner Easement Rights To Access Neighbor's Utility Services Genevieve M. Daniels Genevieve M. Daniels, P.C., Highland Park
Workers' Compensation Calculating the Employer's Pro Rata Share of Costs Under §5(b) of the Workers' Compensation Act Kisa P. Sthankiya Rusin Law, Ltd., Chicago
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Handbook Excerpt Navigating the Medicaid Appeals Process from Notice to Court Review Medicaid applicants and recipients are entitled to notice of any action affecting their claims or benefits. This excerpt from Ch. 3 of Advising Elderly Clients and Their Families (IICLE®, 2026) explains notice requirements and hearings procedures for those who lose those claims and benefits. Excerpted from Advising Elderly Clients and Their Families (IICLE®, 2026) Helen Mesoloras Dutton Casey & Mesoloras, P.C., Chicago

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Corporate & Commercial

Unpaid Commissions, Written Contracts, and the Limits of Business Torts

The Northern District of Illinois recently discussed the contours of the economic-loss doctrine, promissory fraud, and rules regarding agents of a disclosed principal in an insurance agent's lawsuit over unpaid insurance commissions.

In Gambino v. Pettit, No. 25-cv-08216, 2026 WL 2168840 (N.D.Ill. July 28, 2026), plaintiff Mark Gambino was an independent insurance agent operating through his agency, Gambino Insurance. He entered into agreements with defendants to sell insurance policies and earn commissions. When disputes arose over unpaid commissions, Gambino sued asserting claims for breach of contract, promissory fraud, and violations of business tort statutes.

The defendants moved to dismiss, arguing that Gambino's tort claims were barred by the economic-loss doctrine and that certain claims failed to state a claim.

Economic-Loss Doctrine

The Northern District began by explaining that under Illinois law, the economic-loss doctrine generally bars tort recovery when a plaintiff's damages are purely economic and arise from a contractual relationship. The doctrine is intended to maintain the distinction between contract and tort law.

However, the court noted that promissory fraud is an exception to the economic-loss doctrine. A plaintiff may plead promissory fraud where the defendant made a false promise of future conduct with the present intent not to perform, and the plaintiff relied on that promise to his detriment.

Applying these principles, the court found that Gambino had adequately pleaded promissory fraud by alleging that the defendants promised to pay commissions with no intention of doing so at the time the promises were made.

Agent of Disclosed Principal

The defendants also argued that Gambino, as an agent for disclosed insurance carriers, lacked standing to sue for breach of the commission agreements because the carriers, not Gambino, were the real parties in interest.

The court rejected this argument, explaining that under Illinois agency law, when an agent acts for a disclosed principal, the agent generally cannot sue or be sued on contracts made on behalf of the principal. However, this rule does not apply when the agent has a personal interest in the contract or when the contract expressly provides that the agent is a party.

Here, the court found that Gambino had a personal interest in the commission agreements because the commissions were to be paid directly to him, not to the insurance carriers. Therefore, Gambino had standing to enforce the agreements.

Takeaways

This case provides useful guidance on the economic-loss doctrine and the ability of insurance agents to sue for unpaid commissions. Practitioners representing agents or principals should carefully review commission agreements to determine who has the right to enforce them.

Source: September 2026 FLASHPOINTS.

FLASHPOINTS

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