Quick v. Shell Oil Co.

937 N.E.2d 255, 404 Ill. App. 3d 277
CourtAppellate Court of Illinois
DecidedSeptember 22, 2010
Docket3-09-0987
StatusPublished
Cited by3 cases

This text of 937 N.E.2d 255 (Quick v. Shell Oil Co.) 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
Quick v. Shell Oil Co., 937 N.E.2d 255, 404 Ill. App. 3d 277 (Ill. Ct. App. 2010).

Opinion

JUSTICE CARTER

delivered the opinion of the court:

The Danhausen estate appeals from a decision of the trial court approving the distribution of funds from the settlement of a class action suit against Shell Oil Company and other defendants (collectively Shell). Thomas M. Ewert, the settlement administrator (Settlement Administrator), recommended that the Danhausen estate be awarded a total of $120,489. The Danhausen estate, however, claims it is entitled to $4,689,200. Class counsel has responded to the Danhausen estate’s arguments on appeal and contends that the trial court’s decision should be affirmed. We agree with class counsel and affirm the award approved by the trial court.

FACTS

The instant case arises out of a release of thousands of gallons of gasoline in November 1988 from a Shell pipeline onto the Danhausen farm in Limestone Township, Kankakee County, Illinois. In 2001, suit was filed against Shell seeking damages for property damage and personal injuries allegedly caused by the gasoline release. In 2005, the case was removed to federal court, and two property damage subclasses were certified in January 2007. In re Methyl Tertiary Butyl Ether (“MTBE”) Products Liability Litigation, 241 F.R.D. 435 (S.D.N.Y. 2007). In December 2007, the federal court remanded the action to the Kankakee County circuit court after it was determined that the case had been improperly removed.

On December 12, 2007, the parties filed a joint motion for preliminary approval of class settlement, which was granted. Notice was sent to the class members. The court held a hearing on final approval of the settlement on February 28, 2008. On March 26, 2008, the court entered an order certifying the class for purposes of settlement and granting final approval of the proposed settlement. The settlement agreement defined the class as “all current owners of real property in the Outer Area and Core Area, as defined on the map attached [to the settlement agreement], and all people who resided or owned property within the Core Area from November 1, 1988, to the date of Final Approval.” The court found that the settlement was fair and reasonable. The settlement agreement provided a fund of $26 million to be distributed by a settlement administrator. Specifically, the fund was provided to:

“reimburse Class Members within the Core Area for any and all damages they have claimed or may have claimed for any and all damages as a result of the release of MTBE and/or gasoline *** (including, but not limited to, claims for diminished property value, unreimbursed past and future costs of obtaining alternative water such as water bills or payment for bottled water, past and future lost rent, nuisance, past easements and access, costs for connections to water mains, investments in private wells and interference with quiet enjoyment of property), except for claims for personal injury, which are excluded from this Settlement.”

In addition, the fund was to be distributed to provide class members in the Outer Area with an amount sufficient to test well water for methyl tertiary butyl ether (MTBE) contamination and to provide potable water if MTBE was detected in those wells. The settlement agreement also provided to connect residences in the Core Area to a public water system.

The court appointed former judge Thomas M. Ewert to administer the settlement. Under the settlement agreement, the Settlement Administrator shall decide whether a claimant submitted adequate proof to establish that he or she was a class member, the amount of each claim to be allowed, the time when payment of a claim shall be made, and, subject to court approval, the amount of the initial distribution and any reserve. There was no appeal of the court’s order granting final approval of the settlement.

On November 26, 2008, the Settlement Administrator filed a report of his findings and recommendations regarding the distribution of settlement funds and requested that the court order distribution accordingly. Regarding claims for diminished property values, the Settlement Administrator consulted a licensed real estate appraiser, Jay M. Heap. Heap concluded that the diminution in value of property in the Core Area linked to the 1988 gasoline spill was less than 5%. The Settlement Administrator used the assessed valuation of improved property, using figures provided by the Kankakee County assessor’s office, to approximate the current market values of that property. For agricultural property, the Settlement Administrator determined that the assessed valuation of that property was not related to its market value. Heap concluded that the average value of agricultural property in Limestone Township was approximately $5,000 per acre, and the Settlement Administrator used that amount when determining the current market value for such property. The Settlement Administrator also concluded that the claimants who lived in the Core Area should be awarded $150 per year for each year they lived at a property in the Core Area since 1988 as recompense for nuisance and interference with quiet enjoyment. Those who lived in closest proximity to the spill, along 4000 W. Road, should be awarded an additional $250 per year for each year that they lived at that location.

The Danhausen estate submitted a claim dated March 25, 2008. The Danhausen estate revoked its previous election to opt out of the settlement dated February 14, 2008. The claim listed eight different parcel numbers, broken into six tracts.

Included in the record are copies of the Settlement Administrator’s calculation sheets on the claim submitted by the Danhausen estate for eight parcels of property. Five of the Danhausen estate parcels were for agricultural land in the Core Area. The Settlement Administrator applied the $5,000-per-acre value to these parcels and calculated a total distribution for diminution in value of these parcels at $78,250.

One claim was for a parcel that included a home in the Core Area that was also in close proximity to the spill. The distribution amount for that parcel included an award for diminution in value, the cost of bottled water, the future increased cost of water, and the cost of a lost well. In addition, the recommended distribution for this parcel included an award for nuisance calculated at $150 per year and at $250 per year. The total value of this claim was calculated at $28,382.

The seventh claim by the Danhausen estate was for rental property. The value of this claim included diminution in value of the property, a lost well and nuisance calculated at $150 per year. The total value of this claim was $13,857. The eighth claim was denied because the property was in the Outer Area and did not have a well on it. The total value of the Danhausen estate’s claims was $120,489.

On December 5, 2008, the Danhausen estate filed an objection to the recommendation of the Settlement Administrator. The Danhausen estate objected to the Settlement Administrator’s valuation of the farmland parcels at $5,000 per acre, claiming the Settlement Administrator did not apply the highest and best use when valuing these parcels because they were zoned residential rather than agricultural.

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Cite This Page — Counsel Stack

Bluebook (online)
937 N.E.2d 255, 404 Ill. App. 3d 277, Counsel Stack Legal Research, https://law.counselstack.com/opinion/quick-v-shell-oil-co-illappct-2010.