City of Chicago v. Boulevard Bank National Ass'n

688 N.E.2d 844, 293 Ill. App. 3d 767, 228 Ill. Dec. 146
CourtAppellate Court of Illinois
DecidedDecember 12, 1997
Docket1-96-2799
StatusPublished
Cited by8 cases

This text of 688 N.E.2d 844 (City of Chicago v. Boulevard Bank National Ass'n) is published on Counsel Stack Legal Research, covering Appellate Court of Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
City of Chicago v. Boulevard Bank National Ass'n, 688 N.E.2d 844, 293 Ill. App. 3d 767, 228 Ill. Dec. 146 (Ill. Ct. App. 1997).

Opinion

JUSTICE QUINN

delivered the opinion of the court:

This case is brought on appeal from an August 5, 1996, order entered by the circuit court of Cook County denying defendants’ traverse and motion to dismiss the City of Chicago’s (City’s) complaint for condemnation, with respect to the quick take of the Oliver Typewriter Building (the Oliver Building) located at 159 North Dear-born Street.

On appeal, defendants contend that: (1) the trial court erred in holding that the City could acquire the Oliver Building with tax increment financing (TIE) for the stated purpose of assembling the property with the Oriental Theater where the City failed to amend the existing TIE plan pursuant to the Illinois Tax Increment Allocation Redevelopment Act (TIE Act) (65 ILCS 5/11 — 74.4—1 et seq. (West 1994)); (2) due to the failure to amend the existing TIE plan, the Oriental Theater Project could not proceed and therefore the requisite necessity for taking the Oliver Building was lacking; (3) the City failed to provide the requisite certainty as to whether or not the Oliver Building was at risk of condemnation; and (4) the quick-take provisions of section 7 — 103 of the Illinois Code of Civil Procedure (735 ILCS 5/7 — 103 (West 1994)) are unconstitutional special legislation. For the following reasons we affirm.

Defendants Golden P Corporation and Peter Palivos, respectively, are the manager and owner of the Oliver Building, and were among the defendants named in the City’s complaint. Palivos had purchased the Oliver Building for $2 million in late 1986 and allegedly invested $750,000 in it. The rear of the Oliver Building abuts the Oriental Theater Building, which faces Randolph Street. The Oriental Theater has not operated as a commercial theater since 1981. In 1994, Livent, Inc. (Livent), a live entertainment and development company headquartered in Toronto, secured an option to purchase the Oriental Theater. Livent then notified the City that it had secured the option on the Oriental Theater. The City’s consultant for North Loop development, U.S. Equities Development Company, commissioned a report which in January of 1995 determined that the stage area of the Oriental Theater was too shallow to accommodate modern live musical productions and that this failing would need to be remedied by expanding the stage area back into the Oliver Building before renovation of the Oriental Theater could proceed. A Chicago real estate developer retained by Livent in March of 1995 valued the building at less than $3 million. On April 14, 1995, Palivos told Livent he would sell the Oliver Building and the adjacent Delaware Building for $10 million. No further negotiations were had between Palivos and Livent.

On December 1, 1995, the City signed a letter of understanding with Livent agreeing to acquire the Oliver Building on behalf of Livent to assist in the redevelopment of the Oriental Theater. By letter dated January 11, 1996, the City informed Palivos that it intended to acquire the Oliver Building.

A public hearing on the Oriental Theater Project was held by the Community Development Commission (CDC) on January 29, 1996. At this hearing, the CDC adopted two resolutions: the first authorized publication of a notice of the City’s intent to negotiate a redevelopment agreement with Livent and to request alternative proposals, and recommended to the Chicago city council that Livent be designated as the developer if no other responsive alternative proposals were received; the second authorized the City to advertise its intent to enter into a negotiated sale of the Oliver Building to Livent. On January 31, 1996, these public notices were run in the Chicago Sun-Times. The notices provided 30 days for members of the public and other developers to make alternative proposals and bids. No alternative proposals were submitted. On March 22, 1996, Palivos appeared at the Chicago city council committee on finance and expressed his opposition to the acquisition of the Oliver Building.

On March 26, 1996, the Chicago city council passed two "Substitute Ordinances.” The first ordinance declared that the redevelopment of the Oriental Theater property and the Oliver Building Property would be "in accordance with” the North Loop Tax Increment Financing Project ordinances passed in June 1984 (1984 TIF Plan). It further provided that Livent was to be the developer of the Oriental Theater Project and that the City would finance the acquisition of the Oliver Building with tax increment financing and then convey the Oliver Building to a Livent subsidiary for assemblage with the Oriental Theater. The second ordinance found it necessary to acquire the Oliver Building and authorized its acquisition pursuant to the City’s home rule power in a quick-take proceeding.

On April 9, 1996, the City of Chicago filed an eminent domain action to acquire the Oliver Building. The City subsequently filed a motion for vesting of title and requested that the trial court assign the matter for a "quick take” hearing pursuant to section 7 — 103 of the Illinois Code of Civil Procedure. 735 ILCS 5/7 — 103 (West 1994). On May 15, 1996, defendants filed an amended traverse and motion to dismiss, challenging the City’s authority to condemn the Oliver Building and invocation of quick-take procedures because the ordinances authorizing the condemnation of the Oliver Building changed the nature of the redevelopment project and the condemnation affected the general land uses established in the North Loop 1984 TIE Plan. Defendants further alleged that the renovation of the Oriental Theater also changed the nature of the redevelopment project and affected the general land uses established in the North Loop 1984 TIE Plan. The defendants asserted that these changes required the City to go through the approval process required by section 11 — 74.4—5(c) of the TIE Act (65 ILCS 5/11 — 74.4—5(c) (West 1994)). The defendants also claimed that the City failed to provide the requisite certainty that the Oliver Building was at risk of condemnation. The defendants further claimed that the quick-take statute is unconstitutional special legislation.

The record indicates that, at the hearing before the trial court on the factual issues, the City submitted the ordinances, resolutions and offers setting forth the purpose and necessity of the acquisition of the subject property and establishing the blighted character of the subject area. In rebuttal, defendants presented testimony of certain City officials called as adverse witnesses, as well as the testimony of representatives of Livent. On August 5, 1996, the trial court entered an order denying defendants’ traverse and motion to dismiss. The trial court found that the Oliver Building was located in a blighted commercial area and that the Chicago city council had passed ordinances authorizing the condemnation proceedings. The trial court found that the condemnation of the Oliver Building did not change the general land use or the nature of the redevelopment project and therefore the City was not required to comply with the notice requirements of the TIE Act before acquiring the Oliver Building. 65 ILCS 5/11 — 74.4—5(a), (c) (West 1994).

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688 N.E.2d 844, 293 Ill. App. 3d 767, 228 Ill. Dec. 146, Counsel Stack Legal Research, https://law.counselstack.com/opinion/city-of-chicago-v-boulevard-bank-national-assn-illappct-1997.