Illinois Eminent Domain Practice 2016 Edition - Lewis Rice …€¦ · ILLINOIS INSTITUTE FOR CONTINUING LEGAL EDUCATION i ILLINOIS EMINENT DOMAIN PRACTICE (IICLE®, 2016) This 2016

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ILLINOIS INSTITUTE FOR CONTINUING LEGAL EDUCATION i

ILLINOIS EMINENT DOMAIN PRACTICE (IICLE®, 2016) This 2016 edition revises and replaces the 2013 edition of the same title. IICLE is grateful to the chapter authors for their dedication to this project. We are able to continue to publish current, accurate, and thorough practice handbooks because of the generous donation of time and expertise by volunteer authors like them. Any tax information or written tax advice contained herein (including any forms or attachments) is not intended to be and cannot be used by any taxpayer for the purpose of avoiding tax penalties that may be imposed on the taxpayer. This notice has been affixed pursuant to U.S. Treasury Regulations governing tax practice. We would be interested in your comments on this handbook. Please address any comments to Director of Publishing, IICLE®, 3161 West White Oaks Drive, Suite 300, Springfield, IL 62704; call Amy McFadden at 800-252-8062, ext. 102; or e-mail comments to [email protected]. Call IICLE® Customer Representatives at 800-252-8062 for information regarding other available and upcoming publications and courses.

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HOW TO CITE THIS BOOK This handbook may be cited as ILLINOIS EMINENT DOMAIN PRACTICE (IICLE®, 2016).

Publication Date: August 26, 2016

ILLINOIS INSTITUTE FOR CONTINUING LEGAL EDUCATION iii

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ILLINOIS INSTITUTE FOR CONTINUING LEGAL EDUCATION v

ILLINOIS EMINENT DOMAIN PRACTICE

2016

Chapter authors: William L. Broom III Christopher J. Murdoch Leo N. Cinquino Richard A. Redmond John W. Damisch Patricia A. Small B. Jay Dowling Mark J. Steger Richard F. Friedman Patrick J. Thornton Michele S. Gonzales Joseph B. VanFleet Valerie M. Moehle Robert J. Will

This 2016 edition revises and replaces the 2013 edition of the same title.

ILLINOIS INSTITUTE FOR CONTINUING LEGAL EDUCATION 3161 West White Oaks Drive, Suite 300

Springfield, IL 62704 www.iicle.com

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Copyright 2016 by IICLE®. All rights reserved. Except in the course of the professional practice of the purchaser, no part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the prior written permission of the publisher. IICLE® encourages the adaptation and use of forms, checklists, and other similar documents printed in its publications in the professional practice of its customers.

IICLE® is a not-for-profit 501(c)(3) organization dedicated to supporting the professional development of Illinois attorneys through Illinois-focused practice guidance. IICLE®’s publications and programs are intended to provide current and accurate information about the subject matter covered and are designed to help attorneys maintain their professional competence. Publications are distributed and oral programs presented with the understanding that neither IICLE® nor the authors render any legal, accounting, or other professional service. Attorneys using IICLE® publications or orally conveyed information in dealing with a specific client’s or their own legal matters should also research original and fully current sources of authority.

Printed in the United States of America. 16EMINDOM 8-16(584)AM PRD: 8-26-16(CTP)

TABLE OF CONTENTS

ILLINOIS INSTITUTE FOR CONTINUING LEGAL EDUCATION vii

Table of Contents About the Authors ...................................................................................................................... ix 1. The Power of Eminent Domain: Introduction and Overview ........................................ 1 — 1 Richard F. Friedman 2. Initial Procedures and Pleadings of the State and Other Condemning Bodies ............ 2 — 1 Richard F. Friedman 3. Pleadings and Procedures by the Condemnee ................................................................. 3 — 1 B. Jay Dowling 4. Quick-Take ........................................................................................................................... 4 — 1 Valerie M. Moehle 5. Eminent Domain Proceedings by Government Authorities Other than the State ....... 5 — 1 John W. Damisch 6. Pretrial Procedure ............................................................................................................... 6 — 1 Leo N. Cinquino 7. Valuation of Property in Eminent Domain ...................................................................... 7 — 1 Richard A. Redmond Christopher J. Murdoch 8. Trial Procedure and Technique ......................................................................................... 8 — 1 William L. Broom III 9. Mandamus and Inverse Condemnation ............................................................................ 9 — 1 Joseph B. VanFleet 10. Leasehold Damages and Awards in Eminent Domain .................................................. 10 — 1 Joseph B. VanFleet 11. Federal Eminent Domain Practice .................................................................................. 11 — 1 Robert J. Will Patrick J. Thornton 12. Environmental Law Issues in Eminent Domain Litigation .......................................... 12 — 1 Michele S. Gonzales Mark J. Steger 13. Appeals ............................................................................................................................... 13 — 1 Patricia A. Small Index ..................................................................................................................................... a — 1


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ABOUT THE AUTHORS

ILLINOIS INSTITUTE FOR CONTINUING LEGAL EDUCATION ix

About the Authors

William L. Broom III is a Partner at Barrett, Twomey, Broom, Hughes & Hoke, LLP in Carbondale, where he concentrates his practice in civil litigation, estate planning, and eminent domain. He is active in the Illinois State Bar Association. He is also a member of the American Bar Association, the American Association for Justice, the Illinois Trial Lawyers Association, and the Illinois CPA Society. Mr. Broom received his B.S. from the University of Illinois and his J.D. from the University of Illinois College of Law.

Leo N. Cinquino is a member of Righeimer Martin & Cinquino, P.C., in Chicago, where he

concentrates his practice in eminent domain litigation. He served for 11 years as a Special Assistant Attorney General for the State of Illinois for eminent domain cases. He is a member of the American, Illinois State, and Chicago Bar Associations. He has lectured for the American Institute of Real Estate Appraisers, the International Right of Way Association, the Society of Municipal Engineers, ISBA, and IICLE® and was editor of the 1992, 1994, and 1996 supplements to Frank S. Righeimer, Jr., EMINENT DOMAIN IN ILLINOIS (Callaghan). Mr. Cinquino is a graduate of Loyola University Chicago School of Law.

John W. Damisch is a Principal in Damisch & Damisch Ltd. in Chicago, where he focuses on civil

trial litigation. He is member of the American, Illinois State, Chicago, and DuPage County Bar Associations. He has been a Special Assistant Attorney General for the State of Illinois handling condemnation matters for the Illinois Departments of Transportation, Economic Development, and Natural Resources and the Illinois State Toll Highway Authority. Mr. Damisch received his B.S. and his J.D. from Northwestern University.

B. Jay Dowling is a Partner at Clayborne, Sabo & Wagner, LLP in Belleville, where he focuses on

eminent domain and real estate litigation. He is a member of the Illinois State, Missouri State, and Energy Bar Associations. Mr. Dowling received his B.S. from Culver Stockton College and his J.D. from St. Louis University School of Law. He is also a graduate of the Illinois State Police Academy.

Richard F. Friedman is a Managing Attorney at Neal & Leroy, LLC in Chicago, where he

concentrates his practice in eminent domain, land use, litigation, and historic preservation. He teaches historic preservation law at the University of Chicago Law School and in the graduate program in historic preservation at the School of the Art Institute of Chicago. He is the Director of the Chicago Art Deco Society and the Past Director and General Counsel of Landmarks Illinois. He is also a frequent lecturer on eminent domain and historic preservation topics. He received his B.S. from the University of Illinois at Urbana-Champaign and his J.D. from the University of Chicago Law School.

Michele S. Gonzales is a Founding Member of Elle Law Group, LLC in Oak Park, where she

devotes her practice to eminent domain and complex commercial litigation. She is a member of the Illinois State and Chicago Bar Associations. She is a speaker and an author regarding Illinois eminent domain law. Ms. Gonzales received her undergraduate degree from the University of Chicago and her J.D. from IIT Chicago-Kent College of Law, where she was on the Dean’s Honor List, a member of Moot Court, a legal writing assistant, and a research assistant.


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Valerie M. Moehle is a Partner at Moehle, Swearingen & Assoc., Ltd., in Pekin, where she focuses on real estate, including eminent domain, estate planning, guardianship and probate, small business, and general civil litigation. She serves as a Special Assistant Attorney General for eminent domain matters. She is a member of the Continuing Education Committee of the Peoria County Bar Association and the Abraham Lincoln Court (formerly Abraham Lincoln Inn of Court), where she was served as President in 2006 – 2007. Ms. Moehle received her B.S. with high honors from the University of Illinois and her J.D. summa cum laude from Northern Illinois University, where she was also a Notes and Comments Editor of the Law Review.

Christopher J. Murdoch is a Partner at Holland & Knight LLP in Chicago, where he focuses on

litigation. He is a member of the Federal Bar Association. Mr. Murdoch received his B.A. from Georgetown University and his J.D. from the University of Michigan Law School.

Richard A. Redmond is a Partner with Holland & Knight LLP in Chicago, where he focuses on

eminent domain, land use litigation, and legal ethics. He is a member of the American, Illinois State, and Chicago Bar Associations. The Illinois Supreme Court originally appointed him to its Committee on Professional Responsibility in 1983, and he served as Chair of the committee in 1993 – 1997, 2008 – 2008, and 2013 – 2015. He was the Chair of the Board of Trustees of the Chicago Academy of Sciences from 1990 – 1994. Mr. Redmond received his B.A. with honors from the University of Notre Dame and his J.D. from Cornell Law School.

Patricia A. Small is an associate at Barrett, Twomey, Broom, Hughes & Hoke, LLP in Carbondale,

where she concentrates her practice in civil and appellate litigation and eminent domain matters. She is a former law clerk for Chief Justice William C. Hastings of the Nebraska Supreme Court. She has served as a Special Assistant Attorney General for land acquisition and real estate matters since 1996. She is a member of the American and Illinois State Bar Associations. Ms. Small received her B.S. in political science from the University of Nebraska-Omaha and her J.D. from the University of Nebraska College of Law.

Mark J. Steger is General Counsel at Clark Hill PLC in Chicago, where he focuses on

environmental law. He is a member of the American Bar Association. He was named in Best Lawyers in 2015. Mr. Steger received his B.S. and his M.S. in finance from the University of Illinois and his J.D. from Seattle University School of Law.

Patrick J. Thornton is an associate at Lewis Rice LLC in St. Louis, where he focuses on

construction law, commercial litigation, and real estate litigation. He is a member of the Missouri and Illinois State Bar Associations. He is also a member of the Missouri Bar Leadership Academy Class of 2014 – 2015. Mr. Thornton received his B.A. cum laude from the University of Notre Dame and his J.D. cum laude from Washington University in St. Louis School of Law, where he was a Board Member of the Washington University Journal of Law and Policy.

Joseph B. VanFleet is the Managing Member of the VanFleet Law Offices in Peoria, where he

concentrates his practice in commercial litigation. He is a member of the American and Illinois State Bar Associations and the Abraham Lincoln Court (formerly Abraham Lincoln Inn of Court). Mr. VanFleet received his B.S. with high honors from the University of Illinois and his J.D. from the University of Illinois College of Law.

ABOUT THE AUTHORS

ILLINOIS INSTITUTE FOR CONTINUING LEGAL EDUCATION xi

Robert J. Will is a Member of Lewis Rice LLC in St. Louis, where he concentrates his practice in matters related trust and estate litigation, commercial litigation, class actions, and condemnation. He is a Fellow of the American Bar Foundation and a member of the Illinois State Bar Association. He currently serves as Cochair for the American Bar Association’s Pretrial Practice and Discovery Committee and is a former Cochair of the ABA’s committees on Homeless Experience Legal Protection, Trust and Estate Litigation, and Zoning and Land Use. Mr. Will received his B.A. summa cum laude from Saint Louis University and his J.D. with high honors and Order of the Coif from George Washington University Law School.


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BOARD OF DIRECTORS

ILLINOIS INSTITUTE FOR CONTINUING LEGAL EDUCATION xiii

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STAFF OF THE INSTITUTE ILLINOIS EMINENT DOMAIN PRACTICE

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IICLE® Staff

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The Power of Eminent Domain: Introduction and Overview RICHARD F. FRIEDMAN Neal & Leroy, LLC Chicago

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I. [1.1] Overview II. [1.2] The Power, Its Source, and Its Limitations III. [1.3] The 2007 Illinois Eminent Domain Act IV. Authority To Exercise the Power of Eminent Domain A. [1.4] State of Illinois B. [1.5] Local Government C. [1.6] Condemnation by Utilities V. The Exercise of the Power of Eminent Domain: A Typical Eminent Domain Action A. [1.7] Prerequisites to Filing the Complaint 1. [1.8] Authority, Public Purpose, and Necessity 2. [1.9] Negotiation with Property Owner B. Filing the Complaint 1. [1.10] Contents of the Complaint 2. [1.11] Public Utilities 3. [1.12] Common Elements 4. [1.13] Service of Process 5. [1.14] Lis Pendens 6. [1.15] Answer and Cross-Petition 7. [1.16] Traverse — Attacks on the Propriety of the Complaint a. [1.17] Authority, Public Purpose, and Necessity b. [1.18] Legal Description c. [1.19] Attempt To Agree on Compensation d. [1.20] Illinois Commerce Commission Approval C. [1.21] Discovery 1. [1.22] Discovery of Facts or Documents 2. [1.23] Discovery of Witnesses D. [1.24] Trial 1. [1.25] Motions in Limine 2. [1.26] View of the Property 3. [1.27] Testimony and Evidence 4. [1.28] Jury Instructions 5. [1.29] Abandonment E. [1.30] Posttrial 1. [1.31] The Judgment Order 2. [1.32] Deposit 3. [1.33] Motion To Vest Title

THE POWER OF EMINENT DOMAIN: INTRODUCTION AND OVERVIEW

ILLINOIS INSTITUTE FOR CONTINUING LEGAL EDUCATION 1 — 3

4. [1.34] Withdrawing the Deposit 5. [1.35] Property Taxes VI. [1.36] Use of Eminent Domain for Urban Redevelopment VII. [1.37] Quick-Take VIII. [1.38] Relocation IX. Appendix A. [1.39] Illinois Statutes Granting the Power of Eminent Domain B. [1.40] Provisions of Eminent Domain Act Granting the Power of Eminent Domain

Through Quick-Take Proceedings

§1.1 ILLINOIS EMINENT DOMAIN PRACTICE


I. [1.1] OVERVIEW This handbook sets forth in significant detail the various components of an eminent domain, or governmental condemnation, action. It is designed to give the practitioner background on basic principles of eminent domain in short order. This handbook is not a complete treatise on the subject, but is intended as a practical guide to help attorneys with the issues that they frequently encounter in eminent domain cases. The goal of this introductory chapter is to address the following basic questions concerning the power of eminent domain: a. What is the power of eminent domain, and what are its limitations? b. What is the source of the power of eminent domain? c. Who can exercise the power of eminent domain? d. How is the power of eminent domain exercised? This chapter also provides a skeletal outline of a typical eminent domain action in Illinois courts, from the prefiling stage to the vesting of title in the condemning authority. This outline is not exhaustive, and the other chapters in this handbook explain, in detail, many of the significant factors of which the practicing attorney must be aware of in preparing and litigating an eminent domain case. II. [1.2] THE POWER, ITS SOURCE, AND ITS LIMITATIONS Eminent domain is the power of the sovereign to condemn or appropriate private property for public use. The power is inherent in the sovereign and exists separately from any constitution or statutory laws. Department of Public Works & Buildings v. Kirkendall, 415 Ill. 214, 112 N.E.2d 611 (1953); Department of Public Works & Buildings v. McNeal, 33 Ill.2d 248, 211 N.E.2d 266 (1965). The sovereign has the right to assume possession of all real property held by its subjects. Every person who acquires or occupies land does so at the risk of being evicted by exercise of the superior right of the state. Green Street Ass’n v. Daley, 373 F.2d 1, 6 (7th Cir.), cert. denied, 87 S.Ct. 2054 (1967). The source of the power of eminent domain predates our state and federal Constitutions. Constitutional provisions and statutes do, however, limit and regulate the power of eminent domain. See McNeal, supra. For example, the Fifth and Fourteenth Amendments to the United States Constitution provide, in pertinent part:

No person shall be . . . deprived of life, liberty, or property, without due process of law; nor shall private property be taken for public use, without just compensation. U.S.CONST. amend. V.

THE POWER OF EMINENT DOMAIN: INTRODUCTION AND OVERVIEW §1.2


* * *

No State shall . . . deprive any person of life, liberty, or property, without due process of law. U.S.CONST. amend. XIV, §1.

The Illinois Constitution provides:

Private property shall not be taken or damaged for public use without just compensation as provided by law. Such compensation shall be determined by a jury as provided by law. ILL.CONST. art. I, §15.

Traditionally, the sovereign could appropriate private property without limitation. Today, a governmental entity is authorized to acquire private property only for a necessary public use. But as recently as the 19th century, no public-use requirement existed. See Missouri Pac. Ry. v. State of Nebraska ex rel. Board of Transportation, 164 U.S. 403, 41 L.Ed. 489, 17 S.Ct. 130 (1896). While the public-use and necessity requirements are pivotal under modern eminent domain law, the enormous expansion of the range of governmental services has severely diluted both requirements. See Deerfield Park District v. Progress Development Corp., 26 Ill.2d 296, 186 N.E.2d 360 (1962), cert. denied, 83 S.Ct. 1692 (1963); City of Oakbrook Terrace v. LaSalle National Bank, 186 Ill.App.3d 343, 542 N.E.2d 478, 134 Ill.Dec. 299 (2d Dist. 1989). While the concept of eminent domain arguably existed as far back as ancient Greece and Rome, it truly came into focus during the development of the English law. The British monarch could employ one of several procedures to acquire property for public use. Errol E. Meidinger, The “Public Uses” of Eminent Domain: History and Policy, 11 Envtl.L. 1, 7, 9 (1980) (Meidinger). For example, the common law recognized that the monarch had the prerogative to enter private property to defend against either a public enemy or the inroads of the sea. Julius L. Sackman et al., NICHOLS’ THE LAW OF EMINENT DOMAIN §1.21, p. 1-71 (rev. 3d ed. 2007). The monarch enjoyed the rights of purveyance and preemption, which enabled him or her to seize provisions for the use of the royal household without consent of the owner, but which also obliged the monarch to pay for these provisions at a fair price. The monarch could also employ the ancient proceeding known as “inquest of office.” This proceeding bears the strongest resemblance to today’s eminent domain. Inquest of office is an inquiry by jurors into any matter that entitled the monarch to the possession of lands, tenements, goods, and chattels. In America, the use of eminent domain occurred early in the settlement of the colonies and developed rapidly as the need for roads, public facilities, and industry grew. By the end of the colonial period, eminent domain was well established as a legal form. In addition, compensation was routinely, although not universally, paid, and some form of legal proceeding was regularly available. Meidinger, pp. 15 – 16. Shortly after the American Revolution, the use of eminent domain expanded from public roads and buildings to private facilities. However, challenges to the increasingly private use of eminent domain were not formally raised until the process was well under way. In 1832, several defendant-property owners challenged a New Jersey statute granting a private corporation the



right to acquire land for 70 mill sites along a six-mile stretch of the Delaware River. Scudder v. Trenton Delaware Falls Co., 1 N.J.Eq. 694 (Ch. 1832). The court upheld the statute on the ground that the community as a whole would benefit. By 1870, similar acts had been upheld in seven states. Meidinger, pp. 23 – 24. Judicial sanction of these statutes spawned opposition. A number of courts, led by those in New York, struck down private eminent domain authorizations, stating that the Public Use Clause in the Fifth Amendment literally meant “use by the public.” Meidinger, p. 24. In 1896, the United States Supreme Court held explicitly that the Fifth Amendment public-use requirement applied to the states through the Due Process Clause of the Fourteenth Amendment. Missouri Pac. Ry., supra. Although the Court subsequently established loose standards for the public-use requirement and allowed the states great latitude in delegation of that power, it did seek to prevent abuses by tightening the compensation requirement. See United States v. Lynah, 188 U.S. 445, 47 L.Ed. 539, 23 S.Ct. 349 (1903). Originally, the courts viewed the public-use standard in such a manner as to allow practically any taking, but left some room for invalidation if the taking had no public benefit or was a clear abuse of discretion. See Deerfield Park District, supra. Subsequently, decisions in Illinois and in other states indicated that some courts were beginning to take a more stringent view of what constitutes a public use, especially in cases in which the property being condemned was part of an economic redevelopment project and the land would be transferred to a private property owner. See Southwestern Illinois Development Authority v. National City Environmental, L.L.C., 199 Ill.2d 225, 768 N.E.2d 1, 263 Ill.Dec. 241 (2002). See also County of Wayne v. Hathcock, 471 Mich. 445, 684 N.W.2d 765 (2004) (holding that exercise of power of eminent domain violated Michigan Constitution when done to transfer property to private developer). Other states, however, had taken positions contrary to the Southwestern Illinois Development Authority and Hathcock decisions. In those cases, the courts had approved condemning property to be transferred to private property owners as part of an economic development plan. See Kelo v. City of New London, 268 Conn. 1, 843 A.2d 500 (2004); General Building Contractors, L.L.C. v. Board of Shawnee County Commissioners of Shawnee County, Kansas, 275 Kan. 525, 66 P.3d 873, 882 – 883 (2003). In light of this conflict among the states regarding the propriety of condemning land for such economic development projects, the United States Supreme Court granted a writ of certiorari in Kelo to decide whether such takings comport with the Fifth Amendment of the United States Constitution. In 2005, the United States Supreme Court issued its controversial decision in Kelo v. City of New London, Connecticut, 545 U.S. 469, 162 L.Ed.2d 439, 125 S.Ct. 2655 (2005). That decision, which was decided by a five-four vote, reaffirmed prior United States Supreme Court decisions that had broadly defined the “public-use standard” (see, e.g., Berman v. Parker, 348 U.S. 26, 99 L.Ed. 27, 75 S.Ct. 98 (1954) (taking to consolidate land for private urban development); Hawaii Housing Authority v. Midkiff, 467 U.S. 229, 81 L.Ed.2d 186, 104 S.Ct. 2321 (1984) (taking of fee interest of leased property to convey it to lessee)), at least when a proposed taking was done pursuant to a comprehensive plan and after careful consideration. The Supreme Court’s decision in Kelo generated great opposition from the public and state legislatures. Moreover, since Kelo was decided, several state courts have interpreted state constitutional provisions to impose a more restrictive view of what constitutes a public purpose, especially with respect to condemnations for



economic redevelopment. See City of Norwood v. Horney, 110 Ohio St.3d 353, 853 N.E.2d 1115 (2006); Board of County Commissioners of Muskogee County v. Lowery, 136 P.3d 639 (Okla. 2006). III. [1.3] THE 2007 ILLINOIS EMINENT DOMAIN ACT After the Supreme Court’s decision in Kelo v. City of New London, Connecticut, 545 U.S. 469, 162 L.Ed.2d 439, 125 S.Ct. 2655 (2005), Illinois adopted the Eminent Domain Act (EDA), 735 ILCS 30/1-1-1, et seq., effective January 1, 2007. The EDA replaced the prior eminent domain statute, Article VII of the Code of Civil Procedure, former 735 ILCS 5/7-101, et seq. The EDA does not apply to eminent domain proceedings filed before its effective date. Note, however, that a complaint filed before the effective date but amended after the effective date may be subject to the EDA. City of Joliet v. Mid-City National Bank of Chicago, No. 05 C 6746, 2012 WL 5463792 (N.D.Ill. Nov. 5, 2012). It should also be noted that the EDA does not apply to property acquisitions under the O’Hare Modernization Act, 620 ILCS 65/1, et seq., or those in furtherance of an “existing tax increment allocation redevelopment plan,” which is defined in 735 ILCS 30/5-5-5(a-10) as “a redevelopment plan that was adopted under the Tax Increment Allocation Redevelopment Act[, 65 ILCS 5/11-74.4-1, et seq.,] prior to April 15, 2006 and for which property assembly costs were, before that date, included as a budget line item in the plan or described in the narrative portion of the plan as part of the redevelopment project.” This chapter covers highlights of the changes adopted in the EDA. However, attorneys should review the entire EDA to become familiar with that Act’s provisions. It should be noted that §5-5-5 creates many categories of eminent domain taking, with different standards applying depending on which taking category is at issue. Those categories, among others, include (a) takings in which the condemning authority acquires property for public ownership and control (e.g., highways, parks, etc.); (b) takings in which the condemning authority acquires the property for public ownership but the property will be privately controlled (e.g., airports); (c) takings in which the condemning authority acquires blighted property for private ownership and control; and (d) takings in which the condemning authority acquires property for private ownership and control but the acquired property is not blighted. The EDA also contains significant changes relating to litigation costs. Prior to the adoption of the EDA, condemnation cases generally held that the parties to a condemnation action were required to pay their own attorneys’ fees and litigation costs (unless the condemning authority abandoned the case or a traverse was granted). The EDA, however, includes provisions that could shift a property owner’s or tenant’s attorneys’ fees, as well as certain litigation costs, to the condemning authority. For example, 735 ILCS 30/10-5-65 requires a condemning authority to pay a property owner’s reasonable attorneys’, appraisal, and engineering fees if the authority is required to initiate condemnation proceedings as a result of an inverse condemnation lawsuit. 735 ILCS 30/10-5-110 allows a property owner to recover certain fees in distinct categories of takings (e.g., takings for private ownership and control) if the jury awards just compensation in an amount equal to or in excess of a property owner’s settlement demand.



The EDA further imposes potential additional costs on condemning authorities. Under Illinois law prior to the enactment of the EDA, condemning authorities were not required to provide relocation benefits to individuals displaced by a condemnation except if federal funds were involved in the project at issue. 735 ILCS 30/10-5-62, however, generally requires all condemning authorities to pay to displaced residents the relocation costs to which they would be entitled if the federal Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (URA), Pub.L. No. 91-646, 84 Stat. 1894, applied. Another significant change appeared in 735 ILCS 30/10-5-60. Under prior Illinois law, property taken by condemnation was valued as of the date the condemnation complaint was filed. Section 10-5-60, however, allows a court to change the valuation date if the trial does not begin until more than two years after the complaint is filed. In 2011, the historic date of valuation changed again. The Illinois Supreme Court invalidated §10-5-60 sub silentio, adopting the rule of Kirby Forest Industries, Inc. v. United States, 467 U.S. 1, 81 L.Ed.2d 1, 104 S.Ct. 2187 (1984), that the valuation date is the date on which the condemnor pays for the property and takes possession of it. Forest Preserve District of DuPage County v. First National Bank of Franklin Park, 2011 IL 110759, 961 N.E.2d 775, 356 Ill.Dec. 386. IV. AUTHORITY TO EXERCISE THE POWER OF EMINENT DOMAIN A. [1.4] State of Illinois The State of Illinois, as a sovereign, has the power to acquire private property for public use. This inherent power is limited by the state Constitution and is regulated by state statute. See the Eminent Domain Act. The source of the power of eminent domain for all other subdivisions of the state, if it exists at all, is the General Assembly. B. [1.5] Local Government The General Assembly has specifically delegated the power of eminent domain to many of its political subdivisions. However, any law conferring the right of eminent domain must be strictly construed. Department of Transportation v. First Galesburg National Bank & Trust Co., 141 Ill.2d 462, 566 N.E.2d 254, 152 Ill.Dec. 567 (1990). A list of the various governmental entities in Illinois to which the state legislature has conferred the power of eminent domain, and the statutory source and purpose of that power, is set forth in §1.39 below. C. [1.6] Condemnation by Utilities The state has delegated the power to condemn private property to public utilities when necessary for the construction of alterations, additions, extensions, or improvements of utility facilities. 220 ILCS 5/8-509. The utilities’ power of eminent domain is subject to the approval of the Illinois Commerce Commission (ICC). After receiving ICC approval for the acquisition, the utility will institute condemnation in the usual way, subject to the Eminent Domain Act, in the



circuit court. The utilities’ burden to prove necessity in the ICC is by substantial evidence (Kreutzer v. Illinois Commerce Commission, 404 Ill.App.3d 791, 936 N.E.2d 147, 344 Ill.Dec. 5 (2d Dist. 2010)), arguably a higher standard than in the circuit court. Note that the General Assembly removed the requirement that railroads obtain ICC permission to exercise the power of eminent domain. Under the ICC Termination Act of 1995, Pub.L. No. 104-88, 109 Stat. 803, railroad comdemnations are approved by the Surface Transportation Board. Union Pacific R.R. v. Chicago Transit Authority, 647 F.3d 675 (7th Cir. 2011). V. THE EXERCISE OF THE POWER OF EMINENT DOMAIN: A TYPICAL

EMINENT DOMAIN ACTION A. [1.7] Prerequisites to Filing the Complaint Depending on the project and the nature and scope of the action, the number of prerequisites the condemnor must satisfy will vary. Detailed explanations of the prerequisites are discussed in other chapters of this handbook. The major prerequisites to filing are set forth in §§1.8 and 1.9 below. 1. [1.8] Authority, Public Purpose, and Necessity There are three jurisdictional prerequisites to exercising the power of eminent domain in Illinois. First, the condemning authority must have the statutory authority to acquire private property. Department of Transportation v. First Galesburg National Bank & Trust Co., 141 Ill.2d 462, 566 N.E.2d 254, 152 Ill.Dec. 567 (1990); Department of Public Works & Buildings v. Keller, 61 Ill.2d 320, 335 N.E.2d 443 (1975); Town of Libertyville v. Bank of Waukegan, 152 Ill.App.3d 1066, 504 N.E.2d 1305, 105 Ill.Dec. 787 (2d Dist.), appeal denied, 116 Ill.2d 560 (1987). Second, the taking must be for a public purpose. City of Chicago v. Barnes, 30 Ill.2d 255, 195 N.E.2d 629 (1964); Lake Louise Improvement Ass’n v. Multimedia Cablevision of Oak Lawn, Inc., 157 Ill.App.3d 713, 510 N.E.2d 982, 109 Ill.Dec. 914 (1st Dist. 1987). Third, the taking must be necessary (People ex rel. Director of Finance v. Young Women’s Christian Association of Springfield, 86 Ill.2d 219, 427 N.E.2d 70, 55 Ill.Dec. 950 (1981)), although the condemning authority has broad discretion in determining necessity (Keller, supra). See also City of Chicago v. St. John’s United Church of Christ, 404 Ill.App.3d 505, 935 N.E.2d 1158, 343 Ill.Dec. 930 (2d Dist. 2010). 2. [1.9] Negotiation with Property Owner 735 ILCS 30/10-5-10 requires the condemning authority to make a good-faith (bona fide) attempt to negotiate with the property owner before filing a condemnation complaint. Trustees of Schools of Township No. 37 v. First National Bank of Blue Island, 49 Ill.2d 408, 274 N.E.2d 56 (1971); County of Wabash, Illinois v. Partee, 241 Ill.App.3d 59, 608 N.E.2d 674, 181 Ill.Dec. 601 (5th Dist. 1993); Lake County Forest Preserve District v. First National Bank of Waukegan, 200 Ill.App.3d 354, 558 N.E.2d 721, 146 Ill.Dec. 758 (2d Dist.), appeal denied, 135 Ill.2d 557 (1990). Negotiation in good faith is a condition precedent to initiating eminent domain. Forest Preserve



District of DuPage County v. First National Bank of Franklin Park, 2011 IL 110759, ¶63, 961 N.E.2d 775, 356 Ill.Dec. 386. An offer made by a governmental body based on the advice of an experienced appraisal consultant is normally sufficient to establish a good-faith attempt to agree. Id. Amount to be offered. The offer should be “based on the advice of an experienced appraisal consultant.” Id. Caselaw suggests that offering to purchase the property for its appraised value is a safe harbor. See Peoples Gas Light & Coke Co. v. Buckles, 24 Ill.2d 520, 182 N.E.2d 169 (1962); Department of Transportation of State of Illinois ex rel. People v. Brownfield, 221 Ill.App.3d 565, 582 N.E.2d 209, 164 Ill.Dec. 1 (3d Dist. 1991). May the condemnor offer less than the appraised value? Perhaps. In First National Bank of Franklin Park, supra, the Illinois Supreme Court held that it was not in bad faith to make an offer 10 percent less than the appraised value. (In that case, the condemnor received a lower appraisal but only after it made the 90-percent offer.) Egregious under-offers will result in a violation of §10-5-10. City of Chicago v. Zappani, 376 Ill.App.3d 927, 877 N.E.2d 17, 315 Ill.Dec. 530 (1st Dist. 2007); City of Naperville v. Old Second National Bank of Aurora, 327 Ill.App.3d 734, 763 N.E.2d 951, 261 Ill.Dec. 702 (2d Dist. 2002); Forest Preserve District of Will County v. Marquette National Bank, 208 Ill.App.3d 823, 567 N.E.2d 635, 153 Ill.Dec. 677 (3d Dist. 1991). For example, in City of Naperville, the city offered to purchase the subject parcel for significantly less than its appraised value. The city argued that its offer was made in good faith because the environmental condition of the property was unknown, a subsequent finding that the property was contaminated could expose the city to significant liability, and the city had an obligation to the taxpayers to acquire the parcel at the lowest possible price. The trial and appellate courts, however, rejected those contentions. First, the appellate court rejected the city’s argument based on the environmental condition of the property by noting that its offer was contingent on the performance of environmental testing on the property. Therefore, since the city could refuse to go through with the purchase if the testing revealed environmental contamination, the appellate court stated that it could not “understand why any discounting of the purchase price was necessary.” 763 N.E.2d at 956. The appellate court also rejected the city’s argument that its lowball offer was justified due to its obligation to protect the taxpayers. Here, the appellate court noted that condemning authorities must balance any obligation to the taxpayers with their obligation to pay property owners fair compensation when they condemn land. In balancing these competing interests, the appellate court noted that a condemning authority cannot seek to acquire a parcel at a bargain price, presumably because a bargain price would not be a fair price. Id. Need the condemnor send the appraisal with its offer? No. First National Bank of Franklin Park, supra. Form of offer. It is a wise practice for the condemning authority to send its final good-faith offer to the property owner in written form. To adequately satisfy the condemning authority’s duty to attempt to agree, the written bona fide offer should include a. the name and address of the owner;



b. the legal description or common address of the property to be taken (in partial takings, this can be somewhat complicated, which is why it is good practice to have the legal description prepared by a title company or licensed surveyor);

c. the amount of the offer; d. the type of interest sought (fee-simple title, an easement, etc.); and e. an invitation to discuss the offer. How long must the offer remain open? To be in good faith, the offer must remain open for a reasonable period of time so that the property owner may consider it. Illinois State Toll Highway Authority v. Karn, 9 Ill.App.3d 784, 293 N.E.2d 162 (2d Dist. 1973). If a counteroffer is made by the property owner, the condemning authority is obliged to respond to it and must do so in writing. Department of Transportation of State of Illinois ex rel. People v. Walker, 80 Ill.App.3d 1039, 400 N.E.2d 956, 36 Ill.Dec. 376 (3d Dist. 1980). However, ten days is sufficient. First National Bank of Franklin Park, supra. B. Filing the Complaint 1. [1.10] Contents of the Complaint The minimum components of, and information required in, a condemnation complaint are a. the name of the condemning authority; b. the names of all persons interested as owners or who otherwise appear of record, if

known, as defendants; c. a statement of authority, public purpose, and necessity; d. a statement that the condemning authority and the property owners failed to agree on

compensation; e. the legal description, common address, and permanent real estate index number (if any)

of the property; f. a description of the type of interest sought in the property (e.g., fee, permanent easement,

temporary easement, etc.); g. a description of the project and any restoration to the extent available; h. a jury demand if one is desired; and i. a prayer for relief requesting the “court to cause the compensation to be paid to the owner

to be assessed.” 735 ILCS 30/10-5-10(a).



2. [1.11] Public Utilities Under 735 ILCS 30/10-5-10(g), a condemning authority generally is not authorized to take or damage property belonging to a public utility without the prior approval of the Illinois Commerce Commission. If there are public utility facilities on the property to be taken, the condemning authority must request permission by filing and presenting a petition to the ICC. It may be possible for the condemning authority to avoid this requirement by entering into a utility relocation agreement. In a typical relocation agreement, the condemning authority agrees to pay for the relocation and/or replacement of utility easements and facilities in exchange for the utility’s waiving its defense that the condemning authority failed to obtain ICC permission. With respect to railroads, federal regulation of the railways trumps local condemnation power. Under the ICC Termination Act of 1995, local condemnation is subject to the approval of the Surface Transportation Board. Union Pacific R.R. v. Chicago Transit Authority, 647 F.3d 675 (7th Cir. 2011). 3. [1.12] Common Elements Under 735 ILCS 30/10-5-10(e), if a condemning authority seeks to take or damage a common element of property subject to a declaration of condominium ownership under the Condominium Property Act, 765 ILCS 605/1, et seq., or of a common interest community, the complaint should name the unit owners’ association and not the individual unit owners, mortgagees, and lienholders. However, the unit owners, mortgagees, or lienholders may intervene as defendant parties. 4. [1.13] Service of Process Once the complaint is filed, service of process must be made on the named defendants. Traditionally, the county sheriff will serve the defendant with process. Unknown owners are served by publication of notice in a newspaper of general circulation in accordance with 735 ILCS 5/2-206. Defendants are required to appear no later than 30 days after being served. See Illinois Supreme Court Rule 181(a). Because service by publication usually takes longer than personal service, defendants served by publication are not required to appear until the expiration of the three-week publication period. 735 ILCS 5/2-207. 5. [1.14] Lis Pendens A lis pendens notice provides constructive notice to prospective purchasers or other interested parties that the property is the subject of an eminent domain proceeding. See 735 ILCS 5/2-1901. It is good practice for the condemning authority to file a lis pendens notice with the court and record it in the office of the recorder for the county in which the property is located.



6. [1.15] Answer and Cross-Petition A traditional answer to the complaint is neither necessary nor required in an eminent domain action. The right to condemn land affirmatively appears on the face of the complaint. Board of Education of Cicero-Stickney Tp. High School, High School Dist. No. 201 v. City of Chicago, 402 Ill. 291, 83 N.E.2d 714 (1949). It is improper for an owner to file an answer to the complaint to condemn. Illinois courts have consistently held that a defendant in a condemnation case is not required to file an answer, and when a defendant does file an answer to a complaint for condemnation, the answer may be stricken. Board of Education of Cicero-Stickney Tp. High School, supra, 83 N.E.2d at 718; Williamson County v. Brock, 367 Ill. 159, 10 N.E.2d 654, 655 (1937). If the property owner or other defendant desires to assert a claim for damages (e.g., a claim for damage to the remainder in a partial taking), that party must file a cross-petition. Forest Preserve District of Cook County v. Krol, 12 Ill.2d 139, 145 N.E.2d 599 (1957). The cross-petition is mandatory if the owner wishes to assert that there are damages to the remainder. Absent a cross-petition, the owner waives damages to the remainder. 7. [1.16] Traverse — Attacks on the Propriety of the Complaint If the property owner or other defendant is of the opinion that the condemning authority’s complaint is insufficient in some respect, the defendant may elect to file what is known as a “traverse.” This action is similar, at least in theory, to the traditional motion to dismiss. However, unlike a motion to dismiss pursuant to 735 ILCS 5/2-615 and 5/2-619, the court may conduct a trial or evidentiary hearing on the issues raised in a traverse. When the defendant files a traverse, the condemning authority has the burden to establish a prima facie case on the disputed allegation; if the condemning authority is successful, the burden shifts to the defendant, who must show a clear abuse of discretion in exercising the power. Department of Transportation v. First Galesburg National Bank & Trust Co., 141 Ill.2d 462, 566 N.E.2d 254, 152 Ill.Dec. 567 (1990); City of Oakbrook Terrace v. LaSalle National Bank, 186 Ill.App.3d 343, 542 N.E.2d 478, 134 Ill.Dec. 299 (2d Dist. 1989). Motions to dismiss, or traverses, are discussed in detail in other chapters of this handbook. See especially Chapter 3. Some of the basic grounds for attacking the propriety of a condemnation complaint are addressed in §§1.17 – 1.20 below. a. [1.17] Authority, Public Purpose, and Necessity Depending on the nature and the scope of the project, there may be arguments that the proposed condemnation is not for a public purpose or is unnecessary. However, simply because the property to be taken will be transferred to a private entity does not necessarily mean that the property is not being taken for a public purpose. Southwestern Illinois Development Authority v. National City Environmental, L.L.C., 199 Ill.2d 225, 768 N.E.2d 1, 263 Ill.Dec. 241 (2002). The defendant’s attorney should review the complaint carefully to determine whether the condemning body has the statutory authority to pursue eminent domain proceedings and has satisfied all prefiling requirements.



b. [1.18] Legal Description The failure to legally describe the property with reasonable certainty is a ground for dismissal of the complaint. Forest Preserve Dist. of Cook County v. Lehmann Estate, Inc., 388 Ill. 416, 58 N.E.2d 538 (1944); Kreutzer v. Illinois Commerce Commission, 404 Ill.App.3d 791, 936 N.E.2d 147, 344 Ill.Dec. 5 (2d Dist. 2010). c. [1.19] Attempt To Agree on Compensation The failure to allege that the condemning authority made a bona fide attempt to agree with the property owner on compensation is a ground for dismissal of the complaint. Forest Preserve District of Will County v. Marquette National Bank, 208 Ill.App.3d 823, 567 N.E.2d 635, 153 Ill.Dec. 677 (3d Dist. 1991). d. [1.20] Illinois Commerce Commission Approval The failure to allege that the plaintiff has sought and obtained Illinois Commerce Commission approval to condemn utility easements is a ground for the utility company to seek dismissal of the complaint. C. [1.21] Discovery The primary factual issue in an eminent domain case is the fair market value of the property. The subject of valuation is discussed in detail in Chapter 7 of this handbook. The parties are permitted to engage in discovery on valuation issues and other factual matters under the Supreme Court Rules. City of Bloomington v. Quinn, 114 Ill.App.2d 145, 252 N.E.2d 10 (4th Dist. 1969). 1. [1.22] Discovery of Facts or Documents Both the condemning authority and the defendant may serve interrogatories and production requests and motions to admit to discover facts or documents that may be relevant to the condition of the property, comparable sales, and other facts that could impact valuation. See other chapters of this handbook, especially Chapters 3 and 6. 2. [1.23] Discovery of Witnesses Under S.Ct. Rule 213(f), which governs disclosure of testifying witnesses, a party must disclose three types of witnesses: (a) lay witnesses; (b) independent expert witnesses; and (c) controlled expert witnesses. For a lay witness, a party must disclose the subjects on which the lay witness will testify. For an independent expert witness, a party must disclose the subjects on which the witness will testify as well as the opinions the party expects to elicit. For a controlled expert witness, a party must disclose the subject matter on which the witness will testify, the witness’s conclusions and opinions, the bases for those conclusions and opinions, the qualifications of the witness, and any reports prepared by the witness about the case.



The scope of S.Ct. Rule 213(f) is broad. Therefore, attorneys for each party must be sure to disclose not only witnesses who will offer their opinions of value, such as appraisers, real estate brokers, and owners, but also witnesses who may offer opinions on any other issue in the particular case. Expert opinions not disclosed in discovery are barred at trial. S.Ct. Rule 213(g). D. [1.24] Trial The trial of the eminent domain case is discussed in substantial detail in Chapter 8 of this handbook. The significant aspects of the trial are noted in §§1.25 – 1.29 below. 1. [1.25] Motions in Limine If the practitioner believes that certain comparable sales or other evidence should be excluded, the appropriate vehicle for bringing this to the court’s attention is a motion in limine. 735 ILCS 30/10-5-50 and 30/10-5-60 govern the admissibility of certain categories of evidence. 2. [1.26] View of the Property 735 ILCS 30/10-5-45 provides that either party may request that the jury physically inspect the subject property. The jury view typically occurs before any witnesses testify. 3. [1.27] Testimony and Evidence While each case is different, most witness testimony will relate to fair market value. In most cases, the testimony of the real estate appraiser is the most important testimony. The subjects of valuation and valuation witnesses are discussed in detail in Chapter 7 of this handbook. 4. [1.28] Jury Instructions Illinois Pattern Jury Instructions — Civil No. 300.00, et seq., set forth the standard jury instructions to be used in an eminent domain case. 5. [1.29] Abandonment The condemning body is permitted to abandon its efforts to acquire a property on the grounds that the jury verdict is excessive or that the property is no longer needed, or for any other reason. Abandonment may occur even after the condemnor pays the judgment award. City of Chicago v. Harris Trust & Savings Bank, 346 Ill.App.3d 609, 804 N.E.2d 724, 281 Ill.Dec. 759 (1st Dist. 2004). However, abandonment is no longer possible after the government takes possession of the property. 735 ILCS 30/20-5-40. A condemnor may abandon the taking even after the parties have entered into a stipulated judgment order as long as the condemnor has not yet taken possession of the property. Village of Bellwood v. American National Bank & Trust Company of Chicago, 2011 IL App (1st) 093115, 952 N.E.2d 148, 351 Ill.Dec. 775. A condemnor that abandons or dismisses its case at any time after the condemnation complaint is filed must, upon application of the defendant, reimburse all costs, expenses, and



reasonable attorneys’ fees incurred by the defendant up to the time of the abandonment. Trustees of Schools of Township No. 42 ex rel. Community Consolidated School District No. 21 v. Herrmann, 21 Ill.2d 477, 173 N.E.2d 472 (1961). Note that costs are limited to those incurred “in defense of the complaint.” 735 ILCS 30/10-5-70(a). E. [1.30] Posttrial Pursuant to 735 ILCS 30/10-5-45, the jury is required to set forth in writing the compensation to be paid to each defendant. Once judgment is entered on the verdict, the attorney for the condemning authority must follow several steps to complete the transfer of title and payment of the compensation to the defendants. See §§1.31 – 1.35 below. 1. [1.31] The Judgment Order Pursuant to 735 ILCS 30/10-5-70, the court is required to enter an order regarding the payment of just compensation. The attorney for the condemning authority will normally make a motion for the entry of a final judgment order. That order should include the following statements and information: a. a statement that the condemning authority filed the action to ascertain the just

compensation for the taking of certain property for public purposes; b. a statement that all defendants were served with process and that the court had

jurisdiction over the subject matter of the proceeding; c. the legal description of the property; d. the dates on which the case was tried to a jury and on which the jury reached a verdict; e. a statement that the court has determined that the fair market value of the subject property

is the amount of the jury verdict; f. a statement that the condemning authority shall deposit the total compensation with the

county treasurer on or before a date certain; and g. a statement that an order vesting title in the condemning authority shall issue from the

court upon deposit of the total compensation with the treasurer. 2. [1.32] Deposit Absent a court-ordered extension or pending posttrial motions, the total amount of compensation must be deposited with the county treasurer on or before the deposit date set forth in the judgment order. Under 735 ILCS 30/10-5-70, the failure to comply with the order may result in abandonment. Pursuant to 735 ILCS 5/2-1303, the condemning authority is responsible for paying statutory interest from the date of the judgment to the date on which the deposit is made.



3. [1.33] Motion To Vest Title Once the deposit is made, the condemning authority may move for an order vesting title to the property. The order vesting title should reflect the date the court ordered final judgment, the amount of total compensation, and the date on which the deposit was made. The order should also reflect that the condemning authority has exhibited to the court a receipt for this deposit from the county treasurer and the date of issuance of that receipt. Once the court enters this order, title to the property vests in the condemning authority. 4. [1.34] Withdrawing the Deposit Immediately after the condemning authority deposits the total compensation with the county treasurer, the defendants should petition the court for withdrawal. The petition should ask that the court direct the county treasurer to pay the appropriate amounts on deposit to the parties in interest. Each party in interest, such as an owner, lessee, or mortgagee, may file its own petition. Any disagreement among the parties may be resolved by the court. The petition for withdrawal should contain the following elements and information: a. a statement that the petitioner was the owner of the subject property both at the time of

the filing of the complaint and at the time the award was deposited with the county treasurer;

b. the date of entry of the judgment order fixing the fair market value of the property and

the date of the jury verdict, if applicable; c. the date on which the condemning authority deposited the award and the amount of the

deposit, including interest; d. a statement of any encumbrances on the property (such as mortgages) that will be

satisfied out of the condemnation award (attorneys’ fees may also be satisfied out of the condemnation award); and

e. a request that the county treasurer issue a check or checks in the total amount of the net

condemnation award. 5. [1.35] Property Taxes The condemning authority may be entitled to a property tax exemption with respect to property acquired through eminent domain proceedings. This exemption should relate back to the date of filing of the complaint for condemnation. Likewise, the owner may be entitled to a refund of property taxes paid relating to the time after the date the condemning authority filed the complaint. The defendant’s attorney must make a motion seeking an order from the court for such a refund. But query whether this continues to make sense in light of Forest Preserve District of DuPage County v. First National Bank of Franklin Park, 2011 IL 110759, 961 N.E.2d 775, 356 Ill.Dec. 386, in which the court held that the property taken in condemnation is valued at the date



that the condemnor takes possession of the property, not the date that the complaint was filed. Adhering to the traditional rule may give a windfall to the owner, who has both use of the property and relief from real estate taxes during the period between the filing of the complaint and the time the government takes possession. VI. [1.36] USE OF EMINENT DOMAIN FOR URBAN REDEVELOPMENT Creative lawyering and imaginative urban planning have resulted in a new and controversial use of the power of eminent domain. Relying on three commercial redevelopment statutes, municipalities have created redevelopment districts within which private property can be acquired through eminent domain and immediately sold to a private developer for redevelopment purposes. The enabling statutes are (a) the commercial renewal and redevelopment areas statute, 65 ILCS 5/11-74.2-1, et seq., (b) the Business District Development and Redevelopment Law, 65 ILCS 5/11-74.3-1, et seq., and (c) the Tax Increment Allocation Redevelopment Act, 65 ILCS 5/11-74.4-1, et seq., each of which has its own procedural and qualitative requirements for the establishment of a redevelopment district. The Tax Increment Allocation Redevelopment Act, for example, requires extensive notification and public hearings and imposes stringent qualification rules for tax increment financing (TIF) districts. Curiously, the requirements for establishment of a business district pursuant to the Business District Development and Redevelopment Law are sparse. Unless a municipality seeks to impose a retailers’ occupation tax, a service occupation tax, or a hotel operators’ tax, the statute requires nothing more than public hearings by the corporate authorities prior to use of the plentiful authority endowed by the statute. If, however, a municipality does desire to impose one of the aforementioned taxes, the municipality must follow procedures more akin to those imposed under the Tax Increment Allocation Redevelopment Act. 65 ILCS 5/11-74.3-2, 5/11-74.3-5. Municipal lawyers should use caution, however, when using the business district development and redevelopment statute. As of the time of this writing, no caselaw exists in support thereof. The basic premise behind all three statutes is that municipalities need to be able to acquire property within certain designated areas for redeveloping the areas, which by itself would appear to be a valid public purpose. The controversy occurs when the municipal condemnation is followed immediately by the conveyance of the condemned property to a private developer for redevelopment. Indeed, it is not uncommon for the municipality to have in place before the condemnation an agreement with a developer requiring the developer to finance the cost of the condemnation litigation, a cost many developers are more than happy to pay to ultimately take title to otherwise unobtainable real estate. The First District Appellate Court has frequently sustained the exercise of condemnation authority for urban development under the Tax Increment Allocation Redevelopment Act. See, e.g., Village of Wheeling v. Exchange National Bank of Chicago, 213 Ill.App.3d 325, 572 N.E.2d 966, 970, 157 Ill.Dec. 502 (1st Dist.), appeal denied, 141 Ill.2d 562 (1991), and, more recently, City of Chicago v. Eychaner, 2015 IL App (1st) 131833, ¶¶71, 75, 26 N.E.3d 501, 389 Ill.Dec. 411. In Eychaner, the court stated:



Recognizing the difference between a valid public use and a sham can be challenging. But a telling feature of sound public use in the context of economic redevelopment is the existence of a well-developed, publicly vetted, and thoughtful economic development plan. . . .

* * * . . . The goals of the River West TIF — to reduce blighting factors, prevent blight, foster the City’s industrial base, prevent conflicts between residential and industrial uses, and retain existing industry — all constitute valid public uses. The taking of Eychaner’s land to expand Blommer’s industrial campus land furthers each of these goals, and is thus a sound use of eminent domain. 2015 IL App (1st) 131833 at ¶¶71, 75.

To date, the commercial renewal and redevelopment areas and the business district development and redevelopment statutes have not been challenged on this basis. The Illinois Supreme Court has upheld the use of such condemnation authority in other economic development statutes, which suggests that the exercise of similar authority under the commercial renewal and redevelopment areas and the business district development and redevelopment statutes would be found to be constitutional. People ex rel. Adamowski v. Chicago Railroad Terminal Authority, 14 Ill.2d 230, 151 N.E.2d 311 (1958); Illinois State Toll Highway Commission v. Eden Cemetery Ass’n, 16 Ill.2d 539, 158 N.E.2d 766 (1959); Berman v. Parker, 348 U.S. 26, 99 L.Ed. 27, 75 S.Ct. 98 (1954). However, if the condemning authority seeks to acquire a parcel for which there will limited public benefit or that is not part of a comprehensive development plan, the taking might be subject to a constitutional challenge. See, e.g., Kelo v. City of New London, Connecticut, 545 U.S. 469, 162 L.Ed.2d 439, 125 S.Ct. 2655 (2005), discussed in §§1.2 and 1.3 above. For example, in Southwestern Illinois Development Authority v. National City Environmental, L.L.C., 199 Ill.2d 225, 768 N.E.2d 1, 263 Ill.Dec. 241, cert denied, 123 S.Ct. 88 (2002), the Illinois Supreme Court (with two Justices dissenting) held that a regional development authority exceeded its constitutional authority when it sought to condemn a 148.5-acre parcel, which would then be transferred to a private racetrack operator for use as a parking lot to support the racetrack’s operations. In finding that this use of eminent domain was unconstitutional, the majority found that the condemning authority had failed to introduce sufficient evidence to demonstrate the economic development and/or safety benefits of the proposed taking. In so holding, the court appeared to find that the authority’s resolution that asserted that the proposed taking would enhance the public health, safety, morals, and happiness and the general welfare of the citizens through the creation of job opportunities, the generation of additional tax revenue, and the expansion of the tax base did not satisfy the authority’s burden to make a prima facie showing that the taking was for a proper public purpose.



VII. [1.37] QUICK-TAKE The quick-take provisions of 735 ILCS 30/25-7-103.1, et seq., permit certain governmental entities to acquire property by quick-take. Quick-take allows the expeditious acquisition of title without waiting for the final determination of fair market value. This process allows the condemning authority to enjoy the immediate use of the property during the frequently time-consuming proceedings to establish the value of the property. In §25-7-103.1, et seq., the General Assembly granted quick-take power in more than 140 projects or types of developments. However, many of those grants of power have expired. In addition, the General Assembly occasionally adds to the quick-take list. The governmental entities that, as of the date of publication of this handbook, have quick-take powers are listed along with the corresponding ILCS citations in §1.40 below. To invoke the quick-take power once it is granted by the General Assembly, the condemning authority must make a motion pursuant to 735 ILCS 30/20-5-5 for immediate vesting of title. Pursuant to 735 ILCS 30/20-5-10(a), the court must fix a date for hearing on the motion not less than 5 days after the motion is filed and shall require appropriate notice. At the hearing, the court must determine, if it has not done so already, (a) whether the plaintiff has the authority to exercise the power of eminent domain, (b) whether the property sought to be taken is subject to the power, and (c) whether the power is being properly exercised. 735 ILCS 30/20-5-10(b). The court’s order on these issues is appealable within 30 days. Id. Once the court resolves the above three issues, it must adjudicate the issues raised by the condemning authority’s motion for taking. If the court finds that there is reasonable necessity for the taking, it must hear evidence necessary to make a preliminary finding of just compensation and then make such a finding. 735 ILCS 30/20-5-10(c). In accordance with 735 ILCS 30/20-5-15, following the court’s finding of preliminary compensation and the condemning authority’s deposit of the amount of preliminary compensation with the county treasurer, the court, upon a motion by the condemning authority, will enter an order vesting title in the condemning authority and fixing a date on which the condemning authority may take possession of the property. Pursuant to 735 ILCS 30/20-5-20, an interested party may then move to withdraw the portion of the preliminary compensation to which that party is entitled. The condemning authority is not required to pay interest on the preliminary compensation amount unless required by 735 ILCS 30/20-5-30. After the condemning authority obtains title, the case proceeds as any other eminent domain case, and if the parties make a proper and timely request, it may be tried to a jury. Evidence of the amount of preliminary compensation is inadmissible pursuant to §20-5-10(d). If the jury awards an amount less than the preliminary finding of just compensation, the interested party or parties must refund any such excess amounts. Once the condemning authority has taken possession of the property, under 735 ILCS 30/20-5-40 the condemning authority cannot dismiss or abandon the proceeding unless the interested parties consent. The exercise of quick-take power is even more drastic than usual eminent domain



proceedings because of the immediate vesting of title in the condemning entity. Department of Transportation ex rel. People v. First Galesburg National Bank & Trust Co., 189 Ill.App.3d 797, 545 N.E.2d 770, 137 Ill.Dec. 117 (3d Dist. 1989), rev’d, 141 Ill.2d 462 (1990). Quick-take is intended to be used only in circumstances in which the immediate use of private property is necessary for a public project and the project cannot wait for the ascertainment of just compensation. See Chapter 4 of this handbook. For example, quick-take authority is frequently approved by the state legislature for such local public works projects as sewer extensions, road widenings, and sidewalk installations. See 735 ILCS 30/20-5-5. The use of quick-take with the redevelopment statutes has been condoned for the City of Chicago. In City of Chicago v. Boulevard Bank National Ass’n, 293 Ill.App.3d 767, 688 N.E.2d 844, 228 Ill.Dec. 146 (1st Dist. 1997), a challenge was made to a statute that authorized quick-take for condemnations under the commercial renewal and redevelopment areas and the business district development and redevelopment statutes by municipalities having a population of more than 500,000. The defendant argued that the statute was unconstitutional because it was special legislation enacted for the City of Chicago. The appellate court, however, upheld the provision because there was a rational basis for distinguishing between municipalities with populations in excess of 500,000 and smaller municipalities. In particular, the court observed that the use of quick-take with condemnation for redevelopment of blighted areas in downtown Chicago is proper because (a) the relocation burden is substantial, particularly with buildings with large numbers of tenants, and (b) the size of the buildings and the poor quality of the land records make it extremely difficult to ascertain the interested parties and determine how to divide compensation. Note that the Fourth District Appellate Court has affirmed granting a condemnor lacking quick-take power immediate possession in exigent circumstances, similar to a temporary restraining order, after depositing funds with the court. Enbridge Pipelines (Illinois), L.L.C. v. Troyer, 2015 IL App (4th) 150334, 38 N.E.3d 1282, 395 Ill.Dec. 526, appeal denied, 2016 IL 120148. VIII. [1.38] RELOCATION In a condemnation action, the condemning authority is required to pay the property owner just compensation for the taking. The Illinois Constitution provides that “[p]rivate property shall not be taken or damaged for public use without just compensation as provided by law. Such compensation shall be determined by a jury as provided by law.” ILL.CONST. art. I, §15. 735 ILCS 30/10-5-60 defines “just compensation” as “the amount of money that a purchaser, willing, but not obligated, to buy the property, would pay to an owner willing, but not obliged, to sell in a voluntary sale.” Such just compensation, however, does not take into account a property owner’s or tenant’s moving and other relocation expenses. Prior to 1970, several federal statutes provided condemnees with relocation assistance. The scope and application of these relocation provisions varied greatly from agency to agency. In 1970, to provide property owners with a uniform system of relocation benefits, Congress enacted the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970. The URA



provides relocation benefits to individuals and businesses forced to move as a result of a condemning authority’s acquisition of real property, or as a result of a written order by the condemning authority to vacate the property, for a project or program undertaken by a federal agency or with federal financial assistance. The term “federal financial assistance” means a grant, loan, or contribution provided by the United States, except any federal guarantee or insurance, any interest reduction payment to an individual with the purchase and occupancy of a residence by that individual, and any annual payment or capital loan to the District of Columbia. 42 U.S.C. §4601(4). With respect to moving expenses, the URA generally provides that the head of the displacing agency shall provide for the payment of (a) reasonable moving expenses, (b) direct losses of personal property caused by the move, (c) reasonable expenses in searching for a replacement business or farm, and (d) reasonable expenses necessary to reestablish a displaced farm, nonprofit organization, or small business at its new site, not to exceed $25,000. 42 U.S.C. §4622(a). In lieu of this payment, a displaced person can elect to receive an expense and dislocation allowance, which is determined according to a schedule established by the head of the displacing agency. 42 U.S.C. §4622(b). With respect to replacement housing, the URA provides that the head of the condemning authority may make an additional payment, not to exceed $31,000, to any displaced person who is displaced from a home that he or she actually owned and occupied for at least 90 days prior to the initiation of negotiations to acquire the property. 42 U.S.C. §4623(a)(1). That additional payment includes (a) an amount that, when added to the purchase price, equals the cost of a comparable replacement home; (b) an amount that will compensate the displaced person for any increased interest costs the person is required to pay for financing the purchase of another home; and (c) other reasonable expenses incurred by the displaced person to close on the new home (e.g., recording fees, etc.). Id. To qualify for this additional payment, the displaced person must purchase and occupy a “decent, safe, and sanitary” replacement home within 1 year after the date on which the person receives final payment from the condemning authority or the date on which the condemning authority’s displacing obligation under 42 U.S.C. §4625(c)(3) is met, whichever occurs later. 42 U.S.C. §4623(a)(2). Additionally, the condemning authority can often insure any mortgage (including advances during construction) on a comparable replacement home for a displaced person. 42 U.S.C. §4623(b). The URA also makes numerous provisions for relocation planning, assistance coordination, and other advisory services. 42 U.S.C. §4625. Under these provisions, the condemning authority needs to implement a relocation advisory program so that the problems associated with the proposed displacement can be recognized at an early stage in the planning process. Furthermore, the advisory program needs to provide for the resolution of the attendant problems so that any adverse impacts can be minimized. 42 U.S.C. §4625(a). These advisory services need to be made available to all persons displaced by the condemning authority and can also be provided to any person occupying property immediately adjacent to the property being acquired if the acquisition causes substantial economic injury to that individual. 42 U.S.C. §4625(b). Prior to the enactment of the Eminent Domain Act, Illinois did not have a comprehensive



relocation law. Instead, relocation provisions were scattered throughout the statutes, without consistent application. The EDA now requires all condemning authorities to pay to displaced persons the relocation costs to which they would be entitled under the federal URA. 735 ILCS 30/10-5-62. IX. APPENDIX A. [1.39] Illinois Statutes Granting the Power of Eminent Domain

ILLINOIS STATUTES GRANTING THE POWER OF EMINENT DOMAIN

Chapter Subject Statute Purpose Air Transportation 620 ILCS 5/72 – 5/74 State airports Air Transportation 620 ILCS 25/33 Air rights Air Transportation 620 ILCS 40/2 – 40/5 Airports and landing

fields (counties) Air Transportation 620 ILCS 45/6, 45/7 Airports and landing

fields (counties of less than 1 million inhabitants)

Air Transportation 620 ILCS 50/22, 50/24, 50/31 County airports Air Transportation 620 ILCS 55/1 East St. Louis airport

(MidAmerica St. Louis Airport)

Business Organizations — Corporations

805 ILCS 25/2 Corporation canal construction

Business Organizations — Corporations

805 ILCS 30/7 Acquiring gas company stockholder shares

Conservation 525 ILCS 30/7.05, 30/14 Preservation of natural

areas Conservation 525 ILCS 40/3 State forests



Chapter Subject Statute Purpose Counties 55 ILCS 5/5-1095 Limited easement to

extend cable for community antenna television systems

Counties 55 ILCS 5/5-1119 Mississippi River

ferries Counties 55 ILCS 5/5-11001 Parking facilities Counties 55 ILCS 5/5-15007, 5/5-15009 Water supply,

drainage, and flood control

Counties 55 ILCS 5/5-30021 Historic preservation Counties 55 ILCS 85/9, 90/60 Economic

development project areas

Counties 55 ILCS 100/3 Coal processing plants Environmental Safety 415 ILCS 95/6 Junkyards Executive Branch — Capital Development Board

20 ILCS 3105/9.08a, 3110/5 Acquisition of land and buildings for state use

Executive Branch — Department of Commerce and Economic Opportunity

20 ILCS 620/9 Economic development areas

Executive Branch — Department of Commerce and Economic Opportunity

20 ILCS 685/1 Particle accelerator land acquisition

Executive Branch — Department of Natural Resources

20 ILCS 835/2 State parks and nature preserves

Executive Branch — Department of Natural Resources

20 ILCS 1920/2.06, 1920/2.08 Reclamation of abandoned, mined land



Chapter Subject Statute Purpose Executive Branch — Department of Natural Resources

20 ILCS 1920/2.11 Reclamation of abandoned, non-coal mined land

Executive Branch — Executive Departments

20 ILCS 5/5-675 The Secretary of the Illinois Department of Transportation (IDOT), the Director of Central Management Services, and the Director of the Illinois Department of Natural Resources (DNR) — compliance with Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970

Executive Branch — Various Departments

20 ILCS 1110/3 Illinois Department of Commerce and Economic Opportunity — rights-of-way and easements for coal use or conversion projects

Executive Officers — Secretary of State

15 ILCS 330/2 Administrative buildings in Cook County

Fish 515 ILCS 5/1-145 Waters and facilities

for propagation for aquatic life

General Provisions — Intergovernmental Cooperation

5 ILCS 220/3.1 Joint water agencies

General Provisions — State Land

5 ILCS 585/1 National forests

Higher Education — Board of Governors Universities

110 ILCS 615/3 Acquiring property



Chapter Subject Statute Purpose Higher Education — Public Community Colleges

110 ILCS 805/3-36 Acquiring property

Higher Education — Public Universities

110 ILCS 660/5-40, 661/6-10 Chicago State University — acquiring property


110 ILCS 665/10-40, 666/11-10 Eastern Illinois University — acquiring property


110 ILCS 670/15-40, 671/16-10 Governors State University — acquiring property


110 ILCS 675/20-40, 676/21-10 Illinois State University — acquiring property


110 ILCS 680/25-40, 681/26-10 Northeastern Illinois University — acquiring property


110 ILCS 685/30-40, 686/31-10 Northern Illinois University — acquiring property


110 ILCS 690/35-40, 691/36-10 Western Illinois University — acquiring property

Higher Education — Regency Universities


Higher Education — Southern Illinois University


Higher Education — University of Illinois

110 ILCS 305/7, 325/2 Acquiring property

Higher Education — University of Illinois

110 ILCS 335/3 Institution for Tuberculosis Research

Housing 310 ILCS 5/6 State housing



Chapter Subject Statute Purpose Housing 310 ILCS 5/26, 5/38 Illinois Housing

Development Authority

Housing 310 ILCS 10/8.3, 10/8.15, 10/9 Housing authorities Housing 310 ILCS 20/5 Housing development

and construction Housing 310 ILCS 35/2 House relocation Interstate Compacts 45 ILCS 30/3 Quad Cities Interstate

Metropolitan Authority

Interstate Compacts 45 ILCS 110/1 Bi-State Development

Agency Libraries 75 ILCS 5/4-7, 16/30-55.80 Local libraries Libraries 75 ILCS 65/1, 65/3 Libraries in parks Local Government — General Provisions

50 ILCS 20/14 Public building commissions — property for municipal purposes

Local Government — General Provisions

50 ILCS 30/6.4 Exhibition councils — properties for exhibitions and public entertainment

Local Government — Property 50 ILCS 605/4 Transfer of real estate

to state Municipalities 65 ILCS 5/9-2-14 through 5/9-2-37 Local improvements Municipalities 65 ILCS 5/11-11-1 Urban rehabilitation Municipalities 65 ILCS 5/11-12-8 Acquisition of land

designated for public use in final plat of subdivision



Chapter Subject Statute Purpose Municipalities 65 ILCS 5/11-13-17 Substandard structures Municipalities 65 ILCS 5/11-19-10 Disposal of refuse,

garbage, and ashes Municipalities 65 ILCS 5/11-28-1 City hospital sites Municipalities 65 ILCS 5/11-29.3-1 Senior citizen housing Municipalities 65 ILCS 5/11-42-11 Limited easement to

extend cable for community antenna television systems

Municipalities 65 ILCS 5/11-45.1-2 Cultural centers Municipalities 65 ILCS 5/11-48.2-2 Historic preservation Municipalities 65 ILCS 5/11-52.1-1, 5/11-52.1-3 Cemetery lots Municipalities 65 ILCS 5/11-61-1 Public works,

buildings, and property Municipalities 65 ILCS 5/11-61-1a Use of quick-take by

municipalities with over 500,000 inhabitants to acquire property for rapid transit lines

Municipalities 65 ILCS 5/11-61-2 Streets, sidewalks,

wharves, and parks Municipalities 65 ILCS 5/11-63-5 Community buildings Municipalities 65 ILCS 5/11-65-3 Municipal convention

halls Municipalities 65 ILCS 5/11-66-10 Coliseums Municipalities 65 ILCS 5/11-68-4 Stadiums and athletic

fields



Chapter Subject Statute Purpose Municipalities 65 ILCS 5/11-69-1 Joint ownership of

municipal buildings Municipalities 65 ILCS 5/11-71-1 Parking facilities Municipalities 65 ILCS 5/11-71-10 Restoration of public

land leased to private parties

Municipalities 65 ILCS 5/11-74.2-8, 5/11-74.2-9 Commercial

redevelopment Municipalities 65 ILCS 5/11-74.3-3 Business district

development Municipalities 65 ILCS 5/11-74.4-4 Tax-increment

financing districts Municipalities 65 ILCS 5/11-74.6-15 Industrial jobs

recovery Municipalities 65 ILCS 5/11-75-5 Lease of space around

municipal buildings Municipalities 65 ILCS 5/11-80-21 Streets and public

ways Municipalities 65 ILCS 5/11-87-3, 5/11-87-5 Watercourses Municipalities 65 ILCS 5/11-92-3 Harbors for

recreational use Municipalities 65 ILCS 5/11-93-1 Piers and beaches Municipalities 65 ILCS 5/11-94-1, 5/11-95-1 Recreational facilities Municipalities 65 ILCS 5/11-97-2 Driveways to parks

outside corporate limits

Municipalities 65 ILCS 5/11-101-1 Airports — general

authority



Chapter Subject Statute Purpose Municipalities 65 ILCS 5/11-102-4 Public airports —

property acquisition (municipalities with 500,000 inhabitants or more)

Municipalities 65 ILCS 5/11-103-2, 5/11-103-3 Public airports —

property acquisition (municipalities with fewer than 500,000 inhabitants)

Municipalities 65 ILCS 5/11-110-3 Flood control and

drainage — outside corporate limits

Municipalities 65 ILCS 5/11-112-6 Flood control and

drainage — general authority

Municipalities 65 ILCS 5/11-117-1, 5/11-117-7 Municipal utilities Municipalities 65 ILCS 5/11-117-11 Public utilities —

submerged land under public waters

Municipalities 65 ILCS 5/11-119.1-7, 5/11-119.1-

10 Heat, power, and light services — municipal power agencies

Municipalities 65 ILCS 5/11-119.2-5, 5/11-119.2-

7 Heat, power, and light services — municipal natural gas agencies

Municipalities 65 ILCS 5/11-121-2 Subways Municipalities 65 ILCS 5/11-122-3 Street railways Municipalities 65 ILCS 5/11-123-4 Harbors and terminals Municipalities 65 ILCS 5/11-123-24 River or harbor

improvements



Chapter Subject Statute Purpose Municipalities 65 ILCS 5/11-125-2, 5/11-126-3,

5/11-130-9, 5/11-135-6 Establishing and supplying waterworks systems

Municipalities 65 ILCS 5/11-136-6 Joint waterworks or

sewer properties Municipalities 65 ILCS 5/11-138-2 Water supply —

outside corporate limits

Municipalities 65 ILCS 5/11-139-12 Combined waterworks

and sewerage systems Municipalities 65 ILCS 5/11-140-3 Outlet sewers and

works Municipalities 65 ILCS 5/11-141-10 Sewerage systems —

abatement of pollution from industrial wastes

Municipalities 65 ILCS 5/11-148-6 Joint sewage disposal

plants with out-of-state municipalities

Municipalities 65 ILCS 20/21-19 City of Chicago —

power to acquire property for municipal purposes

Municipalities 65 ILCS 20/21-21 City of Chicago —

excess condemnation Municipalities 65 ILCS 95/8 Home equity

assurance Municipalities 65 ILCS 100/3 Sports stadiums Municipalities 65 ILCS 110/60 Economic

development project areas

Nuclear Safety 420 ILCS 35/1 Radioactive waste

storage sites



Chapter Subject Statute Purpose Professions, Occupations, and Business Operations — Service and Sales

225 ILCS 435/23 Ferries

Professions and Occupations — Service and Sales

225 ILCS 440/9 Highway advertising signs

Property — Mineral Rights 765 ILCS 505/1 Mines Property — Plats and Surveys 765 ILCS 230/2 U.S. Coast and

Geodetic Survey Railroads 610 ILCS 5/17 – 5/19 Railroad companies Railroads 610 ILCS 115/1, 115/2 Street railroads Roads and Bridges 605 ILCS 5/4-501 IDOT — construction

and maintenance of state highways

Roads and Bridges 605 ILCS 5/4-502 IDOT — building,

widening, altering, relocating, or straightening ditches or draining watercourses

Roads and Bridges 605 ILCS 5/4-505 IDOT — relocation of

railroad tracks or public utility facilities

Roads and Bridges 605 ILCS 5/4-509 IDOT — replacement

of property of public agencies

Roads and Bridges 605 ILCS 5/4-510 IDOT — rights-of-

way for additions to state highways

Roads and Bridges 605 ILCS 5/4-511 IDOT — replacement

of structures demolished by construction



Chapter Subject Statute Purpose Roads and Bridges 605 ILCS 5/5-107 County boards —

relocation of county highways

Roads and Bridges 605 ILCS 5/5-801 Counties —

acquisition of property for county highways and township and district roads

Roads and Bridges 605 ILCS 5/5-802 Counties — building,

widening, altering, relocating, or straightening ditches or draining watercourses

Roads and Bridges 605 ILCS 5/6-309, 5/6-801, 5/6-

802 Township and district roads

Roads and Bridges 605 ILCS 5/6-804 County unit road

districts Roads and Bridges 605 ILCS 5/8-102, 5/8-103 Freeways Roads and Bridges 605 ILCS 5/8-106 Highway crossings Roads and Bridges 605 ILCS 5/10-302 County toll bridges Roads and Bridges 605 ILCS 5/10-602, 5/10-702 Municipal bridges and

ferries Roads and Bridges 605 ILCS 10/9, 10/9.5, 10/10 Toll highways Roads and Bridges 605 ILCS 115/14 Toll bridges Roads and Bridges 605 ILCS 115/15 County taking of toll

bridges Schools — Common Schools 105 ILCS 5/10-22.31b, 5/16-6 Joint buildings for area

vocational education or education of children with disabilities



Chapter Subject Statute Purpose Schools — Common Schools 105 ILCS 5/10-22.35A, 5/16-6 School sites and office

facilities Schools — Common Schools 105 ILCS 5/22-16 Acquisition of

property outside school districts

Schools — Common Schools 105 ILCS 5/32-4.13 Acquisition of

property for school purposes by special charter districts with fewer than 500,000 inhabitants

Schools — Common Schools 105 ILCS 5/34-20 Acquisition of

property for school purposes in cities with more than 500,000 inhabitants

Special Districts — Airport 70 ILCS 5/8.02 – 5/9 Municipal airports Special Districts — Airport 70 ILCS 10/4 Interstate airport

authorities Special Districts — Airport 70 ILCS 15/3 Kankakee River

Valley Area Airport Authority

Special Districts — Civic Center 70 ILCS 200/2-20 Civic Center

Authorities Special Districts — Civic Center 70 ILCS 200/5-35 Aledo Civic Center Special Districts — Civic Center 70 ILCS 200/10-15 Aurora Civic Center Special Districts — Civic Center 70 ILCS 200/15-40 Benton Civic Center Special Districts — Civic Center 70 ILCS 200/20-15 Bloomington Civic

Center Special Districts — Civic Center 70 ILCS 200/35-35 Brownstown Park

District Civic Center



Chapter Subject Statute Purpose Special Districts — Civic Center 70 ILCS 200/40-35 Carbondale Civic

Center Special Districts — Civic Center 70 ILCS 200/55-60 Chicago South Civic

Center Special Districts — Civic Center 70 ILCS 200/60-30 Collinsville Civic

Center Special Districts — Civic Center 70 ILCS 200/70-35 Crystal Lake Civic

Center Special Districts — Civic Center 70 ILCS 200/75-20 Decatur Civic Center Special Districts — Civic Center 70 ILCS 200/80-15 DuPage County Civic

Center Special Districts — Civic Center 70 ILCS 200/85-35 Elgin Civic Center Special Districts — Civic Center 70 ILCS 200/95-25 Herrin Civic Center Special Districts — Civic Center 70 ILCS 200/105-15, 200/105-20 Illinois-Michigan

Canal National Heritage Corridor Civic Center

Special Districts — Civic Center 70 ILCS 200/110-35 Illinois Valley Civic

Center Special Districts — Civic Center 70 ILCS 200/115-35 Jasper County Civic

Center Special Districts — Civic Center 70 ILCS 200/120-25 Jefferson County Civic

Center Special Districts — Civic Center 70 ILCS 200/125-15 Jo Daviess County

Civic Center Special Districts — Civic Center 70 ILCS 200/130-30 Katherine Dunham

Metropolitan Exposition and Auditorium Authority

Special Districts — Civic Center 70 ILCS 200/145-35 Marengo Civic Center



Chapter Subject Statute Purpose Special Districts — Civic Center 70 ILCS 200/150-35 Mason County Civic

Center Special Districts — Civic Center 70 ILCS 200/155-15 Matteson Civic Center Special Districts — Civic Center 70 ILCS 200/160-35 Maywood Civic

Center Special Districts — Civic Center 70 ILCS 200/165-35 Melrose Park Civic

Center Special Districts — Civic Center 70 ILCS 200/180-35 Normal Civic Center Special Districts — Civic Center 70 ILCS 200/185-15 Oak Park Civic Center Special Districts — Civic Center 70 ILCS 200/195-35 Ottawa Civic Center Special Districts — Civic Center 70 ILCS 200/200-15 Pekin Civic Center Special Districts — Civic Center 70 ILCS 200/205-15 Peoria Civic Center Special Districts — Civic Center 70 ILCS 200/210-35 Pontiac Civic Center Special Districts — Civic Center 70 ILCS 200/215-15 Quad City Civic

Center Special Districts — Civic Center 70 ILCS 200/220-30 Quincy Civic Center Special Districts — Civic Center 70 ILCS 200/225-35 Randolph County

Civic Center Special Districts — Civic Center 70 ILCS 200/230-35 River Forest Civic

Center Special Districts — Civic Center 70 ILCS 200/235-40 Riverside Civic Center Special Districts — Civic Center 70 ILCS 200/245-35 Salem Civic Center Special Districts — Civic Center 70 ILCS 200/255-20 Springfield


Special Districts — Civic Center 70 ILCS 200/260-35 Sterling Civic Center



Chapter Subject Statute Purpose Special Districts — Civic Center 70 ILCS 200/265-20 Vermilion County

Civic Center Special Districts — Civic Center 70 ILCS 200/270-35 Waukegan Civic

Center Special Districts — Civic Center 70 ILCS 200/275-35 West Frankfort Civic

Center Special Districts — Civic Center 70 ILCS 200/280-20 Will County


Special Districts — Civic Center 70 ILCS 210/5 Metropolitan Pier and

Exposition Authority Special Districts — Conservation 70 ILCS 405/22.04 Soil and water

conservation districts Special Districts — Conservation 70 ILCS 410/10, 410/12 Conservation districts Special Districts — Development 70 ILCS 507/15 Fort Sheridan

Redevelopment Commission

Special Districts — Development 70 ILCS 520/8 Southwestern Illinois

Development Authority

Special Districts — Drainage 70 ILCS 605/4-17 Drainage districts Special Districts — Drainage 70 ILCS 615/5 Metropolitan Water

Reclamation District of Greater Chicago

Special Districts — Fire Protection

70 ILCS 705/10 Fire protection districts

Special Districts — Forest Preserve

70 ILCS 805/6 Forest preserve districts outside Cook County — forest preserves



Chapter Subject Statute Purpose Special Districts — Forest Preserve

70 ILCS 805/18.8 Forest preserve districts outside Cook County — recreational facilities


70 ILCS 810/8 Cook County Forest Preserve District — forest preserves


70 ILCS 810/38 Cook County Forest Preserve District — recreational facilities

Special Districts — Health 70 ILCS 910/15, 910/16 Hospital districts Special Districts — Health 70 ILCS 915/3, 915/4.5 Medical center

district — Illinois Medical District Commission

Special Districts — Health 70 ILCS 915/9 Medical center

district — State of Illinois and City of Chicago

Special Districts — Health 70 ILCS 920/5 Tuberculosis

sanitarium districts Special Districts — Health 70 ILCS 925/20 Medical center

district — State of Illinois and City of Springfield

Special Districts — Mosquito Abatement

70 ILCS 1005/7 Mosquito abatement districts

Special Districts — Museum 70 ILCS 1105/8 Museum districts Special Districts — Park 70 ILCS 1205/8-1 Park districts — park

land, boulevards, and driveways

Special Districts — Park 70 ILCS 1205/9-2, 9-4 Park districts — airports



Chapter Subject Statute Purpose Special Districts — Park 70 ILCS 1205/11-3 Park districts —

abutting public waters Special Districts — Park 70 ILCS 1205/11.1-3 Park districts —

operation and maintenance of harbors for recreational purposes

Special Districts — Park 70 ILCS 1225/1, 1225/2 Park commissioners —

street widening Special Districts — Park 70 ILCS 1230/1 Park commissioners —

riparian rights Special Districts — Park 70 ILCS 1250/2 Park commissioners —

driveways and boulevards

Special Districts — Park 70 ILCS 1290/1 Aquariums and

museums in public parks

Special Districts — Park 70 ILCS 1305/1, 1305/2 Park districts —

airports Special Districts — Park 70 ILCS 1310/5 Park districts —

elevated highways and boulevards

Special Districts — Park 70 ILCS 1505/15 Chicago Park District —

property acquisition Special Districts — Park 70 ILCS 1505/25.1 Chicago Park District —

parking facilities Special Districts — Park 70 ILCS 1505/26.3 Chicago Park District —

harbor facilities Special Districts — Park 70 ILCS 1570/5 Lincoln Park Special Districts — Port 70 ILCS 1805/8 Havana Regional Port

District



Chapter Subject Statute Purpose Special Districts — Port 70 ILCS 1810/7 Illinois International

Port District (Lake Calumet area)

Special Districts — Port 70 ILCS 1815/13 Illinois Valley

Regional Port District Special Districts — Port 70 ILCS 1820/5 Jackson-Union

Counties Regional Port District

Special Districts — Port 70 ILCS 1825/5 Joliet Regional Port

District Special Districts — Port 70 ILCS 1830/14 Kaskaskia Regional

Port District Special Districts — Port 70 ILCS 1835/6 Mt. Carmel Regional

Port District Special Districts — Port 70 ILCS 1845/5 Seneca Regional Port

District Special Districts — Port 70 ILCS 1850/4, 1850/5 Shawneetown

Regional Port District Special Districts — Port 70 ILCS 1855/4, 1855/5 Southwest Regional

Port District (St. Clair County)

Special Districts — Port 70 ILCS 1860/5 America’s Central Port

District (Madison County)

Special Districts — Port 70 ILCS 1865/5 Waukegan Port

District Special Districts — Port 70 ILCS 1870/8 White County Port

District Special Districts — Railroad 70 ILCS 1905/16 Railroad Terminal

Authority



Chapter Subject Statute Purpose Special Districts — Railroad 70 ILCS 1915/25 Grand Avenue

Railroad Relocation Authority

Special Districts — River Conservancy

70 ILCS 2105/9b, 2105/10a River conservancy districts

Special Districts — Sanitary 70 ILCS 2205/15, 2205/18 –

2205/20 Sanitary districts

Special Districts — Sanitary 70 ILCS 2305/15, 2305/24 North Shore Sanitary

District Special Districts — Sanitary 70 ILCS 2405/8, 2405/15, 2405/16 Sanitary districts —

sewage disposal Special Districts — Sanitary 70 ILCS 2405/16.9, 2405/16.10 Sanitary districts —

waterworks Special Districts — Sanitary 70 ILCS 2405/18 Maintenance of water

channel Special Districts — Sanitary 70 ILCS 2605/8, 2605/16, 2605/35 Metropolitan Water

Reclamation District of Greater Chicago

Special Districts — Sanitary 70 ILCS 2805/10 Sanitary districts outside

municipalities — corporate purposes


municipalities — sewage disposal


municipalities — property held for public use

Special Districts — Sanitary 70 ILCS 2805/26i, 2805/26j Sanitary districts outside

municipalities — drainage systems



Chapter Subject Statute Purpose Special Districts — Sanitary 70 ILCS 2805/27 Sanitary districts outside

municipalities — maintenance of dams

Special Districts — Sanitary 70 ILCS 2805/32k Sanitary districts outside

municipalities — water supply

Special Districts — Sanitary 70 ILCS 2805/32l Sanitary districts outside

municipalities — waterworks

Special Districts — Sanitary 70 ILCS 2905/2-7, 2905/2-8 Metro-East Sanitary

District Special Districts — Sanitary 70 ILCS 3010/10 Sewerage systems Special Districts — Sports Facilities

70 ILCS 3205/12 Sports facilities authorities

Special Districts — Surface Water Protection

70 ILCS 3405/16 Surface water protection districts

Special Districts — Transit 70 ILCS 3605/7 Metropolitan Transit

Authority — acquisition of property, equipment, etc.

Special Districts — Transit 70 ILCS 3605/10 Metropolitan Transit

Authority — removal or relocation of utility structures

Special Districts — Transit 70 ILCS 3610/3, 3610/5 Local mass transit

district facilities Special Districts — Transit 70 ILCS 3615/2.06, 3615/2.13,

3615/2.18, 3615/2.21 Regional Transportation Authority

Special Districts — Water 70 ILCS 3705/8 Public water districts —

waterworks properties



Chapter Subject Statute Purpose Special Districts — Water 70 ILCS 3705/23a Public water districts —

sewerage properties Special Districts — Water 70 ILCS 3715/6 Water authorities —

wells, reservoirs, and other water facilities

Special Districts — Water 70 ILCS 3715/27 Water authorities —

ingress and egress easements and rights-of-way

Townships 60 ILCS 1/115-55 Open space Townships 60 ILCS 1/120-10 Parks Townships 60 ILCS 1/130-5 Cemeteries Townships 60 ILCS 1/205-40 Waterworks and

sewerage systems Urban Problems 315 ILCS 5/14 Blighted areas

redevelopment Urban Problems 315 ILCS 10/5 Blighted vacant areas Urban Problems 315 ILCS 20/9, 20/42 Neighborhood

redevelopment corporations

Urban Problems 315 ILCS 25/4, 25/6 Conservation of urban

residential areas Urban Problems 315 ILCS 30/12 Urban renewal —

slum and blighted areas

Urban Problems 315 ILCS 30/20, 30/22 Urban renewal —

conservation areas Urban Problems 315 ILCS 30/24 Municipal departments

of urban renewal



Chapter Subject Statute Purpose Utilities 220 ILCS 5/4-502 Acquisition of small

public utilities by capable public utilities

Utilities 220 ILCS 5/8-509 Public utilities —

construction of alterations, additions, extensions, or improvements

Utilities 220 ILCS 15/1 Distribution,

transportation, or storage of natural or manufactured gas

Utilities 220 ILCS 30/13 Electric cooperatives —

facilities Utilities 220 ILCS 55/2, 55/3 Telegraph companies —

construction, alteration, or repair of lines

Utilities 220 ILCS 65/4 Telecommunications

carriers — construction, maintenance, alteration, or extension of systems

Vehicles 625 ILCS 5/18c-7501 Commercial rail

carriers Waterways 615 ILCS 5/19 DNR — public water

preserves Waterways 615 ILCS 10/7.8 DNR — Illinois

Waterway Waterways 615 ILCS 15/7 DNR — flood control Waterways 615 ILCS 45/10 DNR — Illinois and

Michigan Canal



Chapter Subject Statute Purpose Wildlife 520 ILCS 5/1.9 DNR — acquiring

property for conservation, hunting and fishing, and wildlife refuge purposes

Wildlife 520 ILCS 25/35 DNR — acquiring

property for habitats B. [1.40] Provisions of Eminent Domain Act Granting the Power of Eminent Domain

Through Quick-Take Proceedings Citation Governmental Unit Purpose 735 ILCS 30/25-7-103.1 State of Illinois, Illinois Toll

Highway Authority, St. Louis Metropolitan Area Airport Authority

Highways

735 ILCS 30/25-7-103.3 Illinois Department of Commerce

and Economic Opportunity For purposes specified in Illinois Coal Development Bond Act

735 ILCS 30/25-7-103.5 St. Louis Metropolitan Area

Airport Authority For purposes specified in the St. Louis Metropolitan Area Airport Authority Act

735 ILCS 30/25-7-103.8 Sanitary districts created under the

Metropolitan Water Reclamation District Act

For purposes specified in the Metropolitan Water Reclamation District Act



Citation Governmental Unit Purpose 735 ILCS 30/25-7-103.9 Rail carriers For purposes specified

in §18c-7501 of the Illinois Vehicle Code, 625 ILCS 5/1-100, et seq.

735 ILCS 30/25-7-103.11 Villages with fewer than 15,000

inhabitants Refuse-derived fuel system and industrial development that will use steam and electricity

735 ILCS 30/25-7-103.12 Municipalities with more than

500,000 inhabitants For purposes set forth in §11-61-1a and Divisions 74.2 and 74.3 of Article 11 of the Illinois Municipal Code, 65 ILCS 5/1-1-1, et seq.

735 ILCS 30/25-7-103.13 Home-rule municipalities For enterprise zone

purposes in an area designated under the Illinois Enterprise Zone Act, 20 ILCS 55/1, et seq.

735 ILCS 30/25-7-103.14 Illinois Sports Facilities Authority For purposes specified

in §12 of the Illinois Sports Facilities Authority Act, 70 ILCS 3205/1, et seq.

735 ILCS 30/25-7-103.15 Municipalities with more than 2

million inhabitants For sports stadium purposes as specified in §3 of the Sports Stadium Act, 65 ILCS 100/1, et seq.

735 ILCS 30/25-7-103.18 Airport authority located solely

within the boundaries of Madison County and organized pursuant to the Airport Authorities Act, 70 ILCS 5/0.01, et seq.

For purposes specified in the Airport Authorities Act



Citation Governmental Unit Purpose 735 ILCS 30/25-7-103.19 Any unit of local government Permanent easement

for maintaining, dredging, or cleaning Little Calumet River

735 ILCS 30/25-7-103.20 Any unit of local government Permanent easement

for maintaining, dredging, or cleaning Salt Creek in DuPage County

735 ILCS 30/25-7-103.21 St. Clair County Joint-use facility at

Scott Air Force Base 735 ILCS 30/25-7-103.22 Village of Summit Waste-to-energy

plant 735 ILCS 30/25-7-103.27 Metropolitan Pier and Exposition

Authority Providing additional grounds, buildings, and facilities

735 ILCS 30/25-7-103.149 City of Chicago O’Hare

Modernization Program purposes


Initial Procedures and Pleadings of the State and Other Condemning Bodies RICHARD F. FRIEDMAN Neal & Leroy, LLC Chicago

2



I. Introduction A. [2.1] The Eminent Domain Act B. [2.2] Scope of Chapter II. Precondemning Procedure A. [2.3] Preliminary Considerations B. [2.4] Hiring Appraisers C. [2.5] Personal Inspection of the Property D. [2.6] Identifying the Parties E. [2.7] Compliance with Federal and State Prerequisites — Environmental, Landmark

Protection, Relocation, and Farmland Preservation Statutes F. [2.8] Surveys G. [2.9] Environmental Assessment H. [2.10] Owner’s Due-Process Rights Prior to Site Selection or Governments

Enactment of Condemnation Authority I. [2.11] Identifying the Occupants J. [2.12] Special Parties — Active Duty Military Personnel and Their Dependents K. [2.13] Relocation Reimbursement L. [2.14] Relocation Coordinator M. [2.15] Sixty-Day Notice Letter for State Agencies N. [2.16] Uniform Relocation Assistance and Real Property Acquisition Policies Act of

1970 O. Conditions Precedent to Filing 1. [2.17] Authority and Delegation of Authority To Implement Condemnation 2. [2.18] Successive Condemnations 3. [2.19] Prerequisites for New Quick-Take Authority 4. [2.20] Quick-Take — What Is a Formally Adopted Schedule or Plan of

Operation? 5. [2.21] Availability of Funds Not Condition Precedent to Filing Petition 6. [2.22] Final Plans of Project Not Condition Precedent to Filing Petition 7. [2.23] Prior Notice Not Condition Precedent to Filing Petition — Other than by

State Agencies 8. [2.24] Delay in Instituting or Prosecuting Condemnation Action Not Fatal 9. [2.25] Approval of Illinois Commerce Commission for Acquisition of Public

Utility Property 10. [2.26] Special Considerations — Railroad Property P. [2.27] Condemnation for Use by Another Governmental Entity — Intergovernmental

Cooperation

INITIAL PROCEDURES AND PLEADINGS OF THE STATE AND OTHER CONDEMNING BODIES


Q. [2.28] Condemnation of Property of Another Public Entity — Municipal Acquisition of Public Property

R. [2.29] Preservation of Status Quo While Condemnation Is Pending S. [2.30] Notice of Right-of-Way Designation and Advance Acquisition T. [2.31] Prefiling Contacts with the Owner U. [2.32] Records of Conversations V. [2.33] Prefiling Inspection W. Attempt To Agree as to Compensation 1. [2.34] Attempt To Agree a Prerequisite 2. [2.35] Condemnation Following Unsuccessful Negotiations by the Expected

Developer 3. [2.36] Who May Submit the Condemnor’s Offer? 4. [2.37] Testing the Sufficiency of the Attempt 5. [2.38] Form Indicating Attempt To Agree 6. [2.39] Conferences with Unrepresented or Represented Defendant 7. [2.40] Terminating the Negotiations 8. [2.41] Waiver 9. [2.42] Multiple Owners, Incompetents, and Nonresidents 10. [2.43] Standards for Finding an Attempt To Agree 11. [2.44] Good-Faith Offer — Reasonableness of the Amount 12. [2.45] Successful Negotiations — Acquisition by Agreement 13. [2.46] Voluntary Conveyance 14. [2.47] Alternate Acquisition by Purchase of Mortgage or Other Lien Rights 15. [2.48] Statements by Public Officials — Are They Binding? III. Complaint for Condemnation A. [2.49] Source and Purpose B. [2.50] Elements of the Complaint for Condemnation 1. [2.51] Name in Which the Action Is Brought 2. [2.52] Necessary Parties Defendant 3. [2.53] Unknown Owners 4. [2.54] Statement of Authority 5. [2.55] Statement of Purpose 6. [2.56] Statement of Necessity 7. [2.57] Necessity — Replacement Property 8. [2.58] Failure To Agree on Compensation 9. [2.59] Description of Property Sought 10. [2.60] Description of Interest Sought 11. [2.61] Jury Demand 12. [2.62] Prayer for Relief



C. [2.63] Summons D. [2.64] Service by Publication E. [2.65] Service of Summons; Special Process Servers F. [2.66] Excusing Service of Complaint for Condemnation G. [2.67] Motions for Appointment of Guardians ad Litem H. [2.68] Lis Pendens Notice I. [2.69] Amendments to the Complaint for Condemnation J. [2.70] Abandonment — Condemnor’s Dismissal of the Complaint K. [2.71] Immediate Right of Entry by Necessity IV. Appendix A. [2.72] Additional Authorities B. Sample Forms 1. [2.73] First-Contact Letter 2. [2.74] Sixty-Day Notice Letter 3. [2.75] Letter To Request Inspection 4. [2.76] Complaint for Condemnation 5. [2.77] Lis Pendens Notice 6. [2.78] Affidavit for Publication 7. [2.79] Affidavit as to Unknown Owners 8. [2.80] Letter of Final Good-Faith Offer

INITIAL PROCEDURES AND PLEADINGS OF THE STATE AND OTHER CONDEMNING BODIES §2.1


I. INTRODUCTION A. [2.1] The Eminent Domain Act On January 1, 2007, the Eminent Domain Act (EDA), 735 ILCS 30/1-1-1, et seq., became law, applying to all condemnation complaints filed thereafter. The bill that created the EDA was 431 pages. Despite its length, the EDA had only five changes of substance over the eminent domain provisions of former Article VII of the Code of Civil Procedure, 735 ILCS 5/1-101, et seq., three of which changes were relatively minor. Most of the remainder of the text was devoted to changing references for consistency or to inconsequential language changes. The two major changes — modifying the standards for determining public use and requiring the government to pay relocation costs of persons displaced from the acquired property — are major changes for units of local government but will have little impact on state takings. Because the state’s exercise of eminent domain is almost exclusively for public ownership and control and because the definition of “public use” in the EDA (see 735 ILCS 30/5-5-5) is not materially different from the pre-EDA standard, there is no change for these condemnations. Similarly, because a large percentage of state acquisitions are for federally assisted transportation projects for which, as discussed later in this section, the payment of relocation reimbursement has been a requirement since 1970, the relocation requirement adds little. The EDA was passed in an attempt to limit the use of condemnation power to assist private development. Since 1954, the United Sates Supreme Court has held that it is not a violation of the Public Use Clause of the Fifth Amendment for government to acquire property through eminent domain and then transfer the property to private persons for economic development. Berman v. Parker, 348 U.S. 26, 99 L.Ed. 27, 75 S.Ct. 98 (1954). The Court’s decision in Kelo v. City of New London, Connecticut, 545 U.S. 469, 162 L.Ed.2d 439, 125 S.Ct. 2655 (2005), affirmed the power to condemn for private development but created a public backlash. In response to the backlash, the Illinois General Assembly, like the legislatures in many states, enacted laws with the goal of limiting the power of government to condemn property for the purpose of conveying it to a private party for economic development and enacted other reforms. The EDA’s major changes are as follows: Standards for determining public use. Property may not be taken unless it is for a “public use.” 735 ILCS 30/5-5-5(a). If the property will be subject to public ownership and control, it is for a public use if the condemning authority proves that “(i) the acquisition of the property is necessary for a public purpose and (ii) the acquired property will be owned and controlled by the condemning authority or another governmental entity.” 735 ILCS 30/5-5-5(b). In substance, this language is little changed from the pre-EDA standard. Any acquisition for a road project, government office building, or public park will be for public use under this standard. The EDA’s major change is its codification of the standards of proof for acquisitions when the ultimate user is not a government body, such as for the clearance of blight, the assemblage of properties for private redevelopment, or the lease or operation of government property by a private entity. The EDA imposes a variety of standards that apply depending on the purpose of the acquisitions. See 735 ILCS 30/5-5-5(c) through 30/5-5-5(f). The most stringent standard



applies to acquisitions for private ownership or control, or both. 735 ILCS 30/5-5-5(c). In these cases, the condemnor must prove by clear and convincing evidence that the acquisition is (1) primarily for the benefit, use, or enjoyment of the public and (2) necessary for a public purpose. Section 5-5-5(c) reverses the former presumption of validity enjoyed by government acquisitions. Although the EDA has been in effect since 2007, very few appellate court decisions have come down construing the application of §5-5-5. One of the few, if not the only case, is City of Joliet v. Mid-City National Bank of Chicago, No. 05 CV 6746, 2014 WL 4667254, *19 (N.D.Ill. Sep. 17, 2014) (eradication of blight is “public use” pursuant to §5-5-5(b). Relocation reimbursement. Prior to the EDA, persons displaced by condemnation were rarely entitled to be paid for their moving and other related expenses under state law. Since 1970, under the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (URA), 42 U.S.C. §4601, et seq., in acquisitions for federally funded projects or other projects with federal involvement, the condemnor was required to pay the relocation costs for owners and other persons displaced for the project. The EDA requires relocation payments for all Illinois condemnations in the same manner as under the URA. 735 ILCS 30/10-5-62. Relocation reimbursements are described in more detail in §2.13 below. This is a major change for most local condemnors, who are now required to budget and pay relocation costs. The EDA’s minor changes are as follows: Variable valuation date. The former eminent domain statute established the date as of which condemned property should be valued as the date of filing the complaint. The valuation date did not change, except for abusive delay by the condemnor. 735 ILCS 30/10-5-60 retained the date of filing as the valuation date but authorized the judge to move the date forward if the case does not proceed to trial within two years of filing the complaint. The statute permitted the court to decide on a new date “in the interest of justice and equity” but not later than the date of trial (or, in the case of quick-take, not later than the date that the condemnor took title to the property). Id. In 2011, the Illinois Supreme Court invalidated 735 ILCS 30/10-5-60 sub silentio, adopting the rule of Kirby Forest Enterprises, Inc. v. United States, 467 U.S. 1, 81 L.E.2d 1, 104 S.Ct. 2187 (1984), that the valuation date is the date on which the condemnor pays for the property and takes possession of it. Forest Preserve District of DuPage County v. First National Bank of Franklin Park, 2011 IL 110759, 961 N.E.2d 775, 356 Ill.Dec. 386. Limits on disposition of acquired property within five years. Property that is acquired by condemnation or threat of condemnation for public ownership and control may not be disposed of for five years unless certain public bidding procedures are followed. 735 ILCS 30/10-5-105. During the five-year holding period, the government must dispose of the property by bid. The state must follow the State Property Control Act, 30 ILCS 605/1, et seq., and municipalities must observe the procedures of the Illinois Municipal Code, 65 ILCS 5/1-1-1, et seq. 735 ILCS 30/10-5-105(c), 30/10-5-105(d). The EDA also has detailed disposition procedures for other governmental entities, including that the property be sold for not less than 80 percent of its appraised value. 735 ILCS 30/10-5-105(e).



Offer of settlement at trial. In trials for the acquisition of property for private ownership or control, the defendant may make an offer of settlement after the close of discovery until 14 days before the start of trial. 735 ILCS 30/10-5-110(b). If the condemnor rejects the offer and the verdict exceeds the offer, the condemnor must pay the owner’s costs and attorneys’ fees. Attorneys’ fees are calculated as a sliding percentage of the “net benefit,” the portion of the award that exceeds the condemnor’s last written offer. 735 ILCS 30/10-5-110(f). 735 ILCS 30/10-5-110 resembles Federal Rule of Civil Procedure 68. The offer of settlement is described in more detail in §6.37 of this handbook. Because this offer-of-settlement procedure applies to acquisitions for other than public ownership and control, it has little application to the state and will not apply to other condemnors involving acquisition for traditional uses such as roads, schools, parks, and the like. B. [2.2] Scope of Chapter This chapter outlines the procedures that the attorney for the condemning body will follow from the time the case is assigned to the filing of the complaint for condemnation. Most of the chapter is applicable to proceedings on behalf of local governments and similar governmental bodies as well as to proceedings on behalf of the State of Illinois and its agencies. For both the state and subordinate governmental entities, the constitutional requirement of just compensation and the procedural and substantive provisions of the Eminent Domain Act apply. One major difference lies in the superior dignity of the state. As a sovereign, the State of Illinois has inherent power of condemnation. Authority granted by the Illinois Constitution and delegated by statute to departments of state government is sufficient to justify the exercise of eminent domain. No additional legislative authority is necessary for the state and its agencies. See, e.g., §4-501 of the Illinois Highway Code, 605 ILCS 5/1-101, et seq. For all lesser divisions of the state, including local governments and special state agencies and subdivisions, two additional requirements are necessary. First, there must be express delegation of the power of eminent domain (home-rule units of local government do not require this delegation). Second, each individual taking or project requires specific authority. For all condemnations other than those exercised by the State of Illinois and its agencies, there must be an authorizing ordinance or resolution, and this authority must be set forth in the complaint for condemnation. For example, if a statute grants authority to a state university to exercise condemnation, the university’s governing board should specifically authorize each project and acquisition. With only a few exceptions, the law and procedures described in this chapter apply to acquisitions by any condemning body, including the State of Illinois, its subdivisions, or units of local government. In addition, attorneys for condemnees will want to be familiar with the principles described in this chapter so that they can assure themselves that all of the protections and prerequisites are carried out before the state exercises the extraordinary power of expropriation. II. PRECONDEMNING PROCEDURE A. [2.3] Preliminary Considerations The attorney should be involved at the outset if land acquisition is contemplated. This early involvement helps ensure that the condemning body properly exercises its authority, that



requirements imposed by state and federal funding sources are complied with, that the owner is treated fairly, that the acquisition proceeds expeditiously, and that the price paid is fair to all sides. Frequently, however, the lawyer representing the condemnor has had no involvement with the case until the condemnor has determined that it cannot obtain the property without condemnation. Agencies of the State of Illinois with statutory authority to acquire property by condemnation, such as the Department of Transportation or the Department of Natural Resources, have their own staffs capable of negotiating with landowners, obtaining appraisals, and generally setting the stage for the filing of the condemnation petition. In these cases, the careful practitioner will double-check the preliminary work to make certain that all statutory and other requirements have been met. These bodies normally supply the lawyer with a form of complaint for condemnation. This form should be reviewed and, if necessary, adapted to the particular assignment. The first task of a lawyer representing a client in a condemnation proceeding is to ascertain the relevant facts at an early stage in the acquisition process. A good working knowledge of the facts will enable the attorney to discuss the case more intelligently with the landowner and the condemnor, but, more importantly, it will give a better idea of the options available to the client from both a legal and a practical standpoint. What is the purpose of the acquisition? Who is the condemning body, and what powers does it have? What steps has the condemnor already taken toward acquisition? What property interests are sought to be acquired? What is the extent of the landowner’s total holding, and how will the remainder of the land be affected by the taking? Are federal or state funds involved? Who, in addition to the fee owner, may be interested in the property? Will tenants or others seek to share in the award? Who will be entitled to relocation benefits? Will benefits accrue to the remainder of the property because of the public improvement? What is the schedule for the project? The answers to these questions often shape the course of action to be taken on behalf of the client. The attorney representing the condemnor should also be involved in the drafting of the authorizing ordinance or resolution. Village of Cary v. Trout Valley Ass’n, 282 Ill.App.3d 165, 667 N.E.2d 1082, 217 Ill.Dec. 689 (2d Dist. 1996), illustrates the pitfalls of amateurish preparation. The village’s complaint for condemnation was dismissed because its acquisition ordinance did not follow the authorizing statute by specifying the financial details of the sewer project, and neither did the village comply with the requirement to publish the ordinance. Research into the authority to exercise condemnation would have avoided this embarrassing and expensive scenario. B. [2.4] Hiring Appraisers In order to evaluate the condemnor’s offer properly, the market value of the property, including damage to the remainder, must be estimated. This determination requires that the opinion of a qualified real estate appraiser be obtained.



The attorney should participate in the choosing of the appraiser to ensure that the appraiser is one who understands and is comfortable with the legal theories involved. An experienced attorney will know which appraisers he or she can work with well, which are best suited for particular assignments, and which will best convey their opinions to the jury. The appraiser must have a thorough understanding of his or her role and assignment before beginning the appraisal. This prior understanding is especially important when federal grants are expected. The Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 and consolidated regulations promulgated thereunder applicable to acquisitions funded by federal agencies (49 C.F.R. pt. 24) require that the condemning body offer the owner an amount no less than the approved appraisal value of the property. Thus the initial appraisals establish the lowest price of the property. Choosing an appraiser is not always easy, and no single rule is applicable to all cases. For example, a real estate broker who may be well qualified to value a single-family residence is not necessarily qualified to value an industrial park even though he or she could qualify as an expert on the witness stand. Factors to be considered in choosing the appraiser include whether a full or partial taking is involved; present zoning and the probability of rezoning; the highest and best use of the property; and the appraiser’s background, experience, and knowledge of the subject property. In any case, the attorney should review the law of compensability with the appraiser to ensure that all compensable elements of damage will be considered by the appraiser. Many appraisers belong to professional societies, admission to which is granted to appraisers with certain education, training, or experience. These societies include the Appraisal Institute (formed by a merger of the American Institute of Real Estate Appraisers and the Society of Real Estate Appraisers), whose members, designated as Member Appraisal Institute (MAI) or Senior Residential Appraiser (SRA), have passed the most stringent requirements. Other professional organizations include the National Association of Independent Fee Appraisers, the International Right of Way Association, the American Right of Way Association, and the American Society of Appraisers. Other qualifications could include memberships on local real estate boards and experience as a real estate broker or developer. Although admission to membership in professional societies may ensure that an appraiser will do a reasonably thorough job and that others have found him or her to be qualified, in choosing an appraiser the attorney should be guided by his or her own knowledge of an appraiser’s ability and his or her evaluation of the appraiser’s knowledge, experience, and judgment. The Illinois Department of Transportation (IDOT) has developed forms for use by its appraisers. These forms ensure uniformity in the methodology used and the kinds of information relied on by each appraiser. Frequently, the appraiser is already retained by the state agency. The forms may already be filled in and the appraisal completed by the time the attorney is assigned to a case. An attorney should nevertheless exercise independent judgment as to the expert witness to use for the purpose of a jury or bench trial. It may be necessary to retain a different appraiser if the particular situation warrants.



The appraiser should be instructed to follow the Uniform Standards for Professional Appraisal Practice (USPAP) adopted by the Appraisal Standards Board of the Appraisal Foundation. The courts increasingly refer to an appraiser’s adherence to the USPAP as a measure of an appraisal’s credibility. See, e.g., People ex rel. Department of Transportation v. Kotara, L.L.C., 379 Ill.App.3d 276, 884 N.E.2d 1235, 318 Ill.Dec. 964 (3d Dist. 2008) (owner should have been afforded opportunity of cross-examining condemnor’s witness about whether he had followed USPAP). C. [2.5] Personal Inspection of the Property An attorney should personally confirm the situation and condition of the subject property at the earliest opportunity. The attorney should inspect the property to be acquired, including (if feasible) the interior, the surrounding properties, and the neighborhood. This inspection will better equip the attorney to assess theories of valuation, to discuss the property with appraisers in a more informed way, and to consider the property’s effect on the jury. D. [2.6] Identifying the Parties From the beginning, it is necessary to determine the identities of the owners and other persons having an interest in the property to be acquired. This may be done through a current “minutes of condemnation” or commitment for title insurance obtained from a title insurance company. Any identifiable owner or interested person who is not made a party to a condemnation action gives rise to at least two risks. If compensation is determined and paid without service on an interested party, this person can later join the action and seek additional compensation. In addition, the court may not have jurisdiction over such nonjoined party and would be unable to order the party to award title or possession of the property to the state. Village of Algonquin v. Lowe, 2011 IL App (2d) 100603, 954 N.E.2d 228, 352 Ill.Dec. 368 (condemnation actions are not in rem; condemnor could not acquire strip of land owned by persons not properly served). Do not omit lessees as parties. A lessee should be named even if the lease has not been recorded. 735 ILCS 30/10-5-10(a) requires that the complaint for condemnation name “all persons interested in the property as owners or otherwise, as appearing of record, if known, or if not known stating that fact.” The complaint must request that the court “cause the compensation to be paid to the owner.” Id. In Chef’s No. 4, Inc. v. City of Chicago, 117 Ill.App.3d 410, 453 N.E.2d 892, 73 Ill.Dec. 67 (1st Dist. 1983), the court reiterated that lessees are “owners” for the purpose of receiving compensation if their rights are condemned and that they are necessary parties in any condemnation proceeding. The lessee in Chef’s No. 4 was neither named as a party in the complaint nor served with process in the condemnation proceeding. The condemnation case proceeded to judgment without the presence of the lessee, and the full award was paid to the county treasurer. The lessee subsequently filed an inverse condemnation action seeking payment for the remainder of its lease, alleging that its leasehold had been taken without compensation. The court held that the lessee was entitled to maintain an inverse condemnation action against the condemnor to compensate for the lessee’s rights and property that had been acquired in the condemnation action. The lesson of Chef’s No. 4 is that there is danger of paying double compensation unless all persons interested are made parties to the condemnation action.



Not surprisingly, only persons having an interest in the property being taken may challenge the condemnor’s authority. In Village of Bensenville v. City of Chicago, 389 Ill.App.3d 446, 906 N.E.2d 556, 329 Ill.Dec. 358 (2d Dist. 2009), the village and private owners filed a complaint seeking a declaratory judgment and injunction to enjoin the city’s acquisition of neighboring properties for an O’Hare Airport expansion, asserting lack of necessity and fraud. The plaintiffs also sought to have the city return properties that it had already condemned from other parties, claiming that the properties were acquired by fraud. The plaintiffs claimed that they would be damaged by the city’s demolition of structures on the land acquired and to be acquired. Citing §10-5-75 of the Eminent Domain Act, which allows intervention in eminent domain proceedings by persons holding an interest in the condemned property, the appellate court held that the owners could not allege that the taking of other property directly infringed a right of their own. The Illinois Supreme Court confronted this issue in City of Chicago v. Prologis, 236 Ill.2d 69, 923 N.E.2d 285, 337 Ill.Dec. 726 (2010). The appellants were holders of bonds secured by the incremental real estate tax revenue generated by the property being acquired by the city. They claimed that they were damaged by the taking because the city’s acquisition caused their bonds to become worthless. The bondholders alleged that the taking destroyed the only source of repayment, because under city ownership the property would be tax exempt and generate no tax revenue. The court held that the bondholders had no property interest in the land itself (as distinct from tax revenues) and thus suffered only a frustration of expectations. Such consequential damages are not compensable. Persons interested in the property must assert their interest in the condemnation case, not in a separate proceeding. Owners may not use a separate proceeding to challenge the condemnor’s authority to exercise eminent domain. In Village of Bensenville, supra, the village and private owners filed a complaint seeking a declaratory judgment and injunction to enjoin the city’s acquisition of their property for O’Hare Airport expansion, asserting lack of necessity and fraud. The appellate court upheld the dismissal of the owners’ claims because the claims could be asserted in the pending eminent domain cases in which the city was seeking to acquire their property. E. [2.7] Compliance with Federal and State Prerequisites — Environmental, Landmark

Protection, Relocation, and Farmland Preservation Statutes Condemnors acquiring land for a variety of projects must frequently satisfy state or federal environmental, landmark protection, and procedural statutory requirements. Failure to comply with a statute could lead to administrative or judicial proceedings to enjoin the project. Loss of state or federal funding could also result from violating any of these provisions. For example, significant projects using federal funds or subject to a federal permit must be preceded by a proper environmental assessment or an environmental impact statement pursuant to the National Environmental Policy Act of 1969, 42 U.S.C. §4321, et seq. Similarly, under §306108 of the National Historic Preservation Act, 54 U.S.C. §306101, et seq, formerly 16 U.S.C. §470f, before property that has been placed on or is eligible for nomination to the National Register of Historic Places may be damaged or destroyed, a hearing must be held and certain other procedures followed. 54 U.S.C. §306108. Illinois has a similar procedure for projects in which state funding or permits could impact historic landmarks that are on the National Register of Historic Places or have been determined to be eligible for placement on the National Register. See §4 of the Illinois



State Agency Historic Resources Preservation Act, 20 ILCS 3420/1, et seq. Further, with respect to any interest in real property to be acquired in part with federal funds, the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 must be obeyed. Although there may be severe adverse impacts from the condemnor’s failure to comply with these environmental, landmark protection, procedural, and relocation statutes, a prohibition against acquisition is not one of these consequences. Violations of environmental laws may have an impact on the project but do not prohibit a condemnor from acquiring property for the project pursuant to the law of eminent domain. See, e.g., Illinois State Toll Highway Authority v. Karn, 9 Ill.App.3d 784, 293 N.E.2d 162 (2d Dist. 1973), in which the court held that a permit under the Environmental Protection Act, 415 ILCS 5/1, et seq., was not required before condemning land for a highway since it is the operation of vehicles, not the highway or its construction, that causes air pollution. With respect to the URA, Illinois courts have held compliance with the Act not to be a condition precedent to condemnation. See, e.g., Department of Transportation v. Zabel, 47 Ill.App.3d 1049, 362 N.E.2d 687, 6 Ill.Dec. 52 (3d Dist. 1977). See also City of Chicago v. R. Zwick Co., 27 Ill.2d 128, 188 N.E.2d 489 (1963); Rhodes v. City of Chicago ex rel. Schools, 516 F.2d 1373 (7th Cir. 1975). The URA itself provides that it will not affect the validity of any property acquisition. 42 U.S.C. §4602(a). Because the URA and other similar statutes do not affect the exercise of condemnation power, compliance with such statutes should not be alleged in any petition to condemn. 735 ILCS 30/10-5-62 imposes the obligation on all condemnors to pay relocation reimbursement for persons displaced under the power of eminent domain. Unlike the URA, the Eminent Domain Act is silent as to the consequences of failing properly to do so. Since relocation reimbursement is usually paid after the property is acquired, relocation reimbursement should not affect the validity of the acquisition. Similarly, the Farmland Preservation Act, 505 ILCS 75/1, et seq., expresses the General Assembly’s desire to protect the state’s natural resources and reduce the loss of agricultural land. While the Act does not prohibit the acquisition and conversion to other uses of farmland, it requires many of the state’s agencies to confer with the Department of Agriculture and consider the Department’s regulations aimed at reducing the loss of farmland. Section 5 of the Farmland Preservation Act is similar to §106 of the National Historic Preservation Act (formerly 16 U.S.C. §470f, recodified as 54 U.S.C. §306108). Prior to participating in any project leading to conversion of farmland to nonagricultural purposes, the head of the agency is to notify the Department of Agriculture and a report is to be prepared. If the procedural prerequisites are complied with, the agency may proceed with the project. 505 ILCS 75/5. But note that the court in Department of Transportation v. Sunnyside Partnership, L.P., 337 Ill.App.3d 322, 785 N.E.2d 1018, 1026, 271 Ill.Dec. 824 (5th Dist. 2003), held, in affirming the denial of a traverse, that “involvement by the courts is not contemplated by the Farmland Preservation Act.”



An additional protection for historic property, whether or not officially designated a landmark, appears in the Tax Increment Allocation Redevelopment Act, 65 ILCS 5/11-74.4-1, et seq. Pursuant to 65 ILCS 5/11-74.4-3(q)(14), tax increment financing (TIF) funds may not be used to demolish or modify property included on or eligible for placement on the National Register of Historic Places. An exception exists if the corporate authorities make a finding that there is no prudent and feasible alternative to removal of the historic structure. F. [2.8] Surveys In most cases, the condemnor should obtain a survey of the property to be acquired. In many cases (e.g., highway projects), a survey is made early in the planning process to determine the project boundaries. In the case of highways, the alignment, exits, utility connections, drainage patterns, and easements are likely to be known in advance of condemnation because these matters appear on the surveys. In other cases, the attorney for the condemnor should see that a survey is prepared prior to proceeding with the case. An acquisition survey will reveal many important conditions. In addition to the boundaries of the individual properties to be acquired, the survey may show land area, the footprint of any building on the property, square footage of such a building, and easements. Surveys are clearly important for architects and planners so that they may know the size and location of the property to be acquired and how to site any new buildings. In addition, however, square footage and easements assist the attorney and appraiser in forming an opinion of value. When values are based on square footage of land, building-to-land ratio, and square footage of building, the exact size of the land and the magnitude of improvements are important. Similarly, if the property is burdened with any easement, its value will be affected accordingly. The surveyors should be instructed to provide the square footage of each parcel to be acquired, the area of a building’s footprint, and the total building floor area. Surveyors may also prepare an acquisition parcel map illustrating all of the parcels to be acquired in an area. When this is mounted on a display board, it becomes a useful tool for the attorney and the public body to keep track of the acquisition status of the project. Individual parcels may be colored in on the plat as they are acquired. G. [2.9] Environmental Assessment For the purposes of planning and valuation, it is useful to have an environmental assessment prior to proceeding with an acquisition. An environmental assessment (also known as a “Phase I environmental assessment”) is a report prepared by an expert, made after a visual inspection of the premises and a study of historical sources. Generally, a Phase I environmental assessment does not involve laboratory testing except, frequently, for asbestos-containing materials. 40 C.F.R. pt. 312 contains Innocent Landowners, Standards for Conducting All Appropriate Inquiries. A Phase I environmental assessment will report the likelihood of environmental contamination on the subject property. The current use of the subject property, its historical uses, the location of nearby sources of contamination, and the presence of underground storage tanks will be found in the Phase I report.



This information will help planning officials in determining the uses that may be made of the acquired property or the work that must be done to remediate contamination. The same information will be helpful to attorneys and appraisers in determining market value. Obviously, known contamination will have an adverse impact on value. Appraisers commonly base their opinion of value on the assumption that the property is not contaminated; with a Phase I environmental assessment, the appraiser will be able to provide a more realistic determination of value. Although environmental issues are treated in more depth in Chapter 12 of this handbook, it is important to understand that the environmental assessment may have a role in the valuation proceedings and also to understand the limits of this role. Section 10-5-50 of the Eminent Domain Act appears to make such a report, as well as the cost of remediation, admissible on the question of value:

Evidence is admissible as to . . . any unsafe, unsanitary, substandard, or other illegal condition, use, or occupancy of the property [and] the reasonable cost of causing the property to be placed in a legal condition, use, or occupancy. . . . Such evidence is admissible notwithstanding the absence of any official action taken to require the correction or abatement of the illegal condition, use, or occupancy. 735 ILCS 30/10-5-50.

Despite similar language in former 735 ILCS 5/7-119 (predecessor to §10-5-50 of the EDA), the appellate court in Department of Transportation ex rel. People v. Parr, 259 Ill.App.3d 602, 633 N.E.2d 19, 198 Ill.Dec. 557 (3d Dist. 1994), held that remediation costs were not admissible in that proceeding. The court held that the costs are admissible only if the trial court finds the presence of an underlying illegal condition to justify the admission of these costs. The court found that the statute presupposes the existence of an illegal condition, and unless the condition is determined to be illegal, it is improper to introduce these costs in the valuation proceeding. Cf. Department of Transportation v. LaSalle National Bank, 251 Ill.App.3d 901, 623 N.E.2d 390, 191 Ill.Dec. 145 (2d Dist. 1993) (allowing testimony regarding wetlands on subject property). Although the admissibility of these reports will doubtless be subject to further litigation, the importance of having a Phase I report at the outset cannot be denied. H. [2.10] Owner’s Due-Process Rights Prior to Site Selection or Government’s Enactment

of Condemnation Authority An owner has no due-process rights in the government’s planning, site selection, or authorization of the exercise of condemnation. This is a legislative process in which individual property owners do not have the right to participate. Adams County Property Owners & Tenant Farmers v. Illinois Commerce Commission, 2015 IL App (4th) 130907, ¶51, 36 N.E.3d 1019, 394 Ill.Dec. 728 (underlying proceedings before Commission neither conferred property rights on landowners nor deprived them of their protected property interests). I. [2.11] Identifying the Occupants Section 2.6 above indicates that parties who have an interest in the property but are not served may later seek compensation, even after the property has been acquired. The right to possession is



yet another problem created by unserved parties. The condemnor may not extinguish the rights to possession of persons occupying the subject property if these persons have not been served. Even if occupants may not be entitled to monetary compensation (because, for example, they have no lease or there is no bonus value to their lease), they have a right to possession. Such a right may not be extinguished without the persons being before the court. Although public records disclose the persons in title and others with recorded interests in the property, it is frequently very difficult to determine the rights of persons with unrecorded interests, which can include tenants with leases, tenants without leases, squatters, advertising signs, and cell towers and other antennas. The obligation to name all parties in interest extends to those who do not have recorded interests. The landlord cannot be relied on to identify all tenants. Prior to filing a complaint, owners may be reluctant to reveal this kind of information. Other landlords may not disclose tenants because they do not want the tenants to learn of the imminent acquisition, fearing that the tenants may break their leases or leave the property earlier than necessary. A landlord may fraudulently conceal an imminent condemnation from tenants or prospective tenants. City of Chicago v. American National Bank & Trust Co., 233 Ill.App.3d 1031, 599 N.E.2d 1126, 175 Ill.Dec. 112 (1st Dist. 1992).

PRACTICE POINTER

A visual inspection will be helpful in determining whether there are advertising signs, antennas, and the like. Doorbells, lobby directories, and signs can reveal the identity of tenants. At times, the services of a private investigator will be necessary to complete the roster of the persons with interests in the property.

J. [2.12] Special Parties — Active Duty Military Personnel and Their Dependents Condemnors should always respect the rights of persons in active military service. Military personnel away from home on active duty and their dependents who remain behind receive certain protections pursuant to the Servicemembers Civil Relief Act (SCRA), ch. 888, as amended by Pub.L. No. 108-189, §1, 117 Stat. 2835 (2003). There are three provisions of the SCRA that relate to condemnation proceedings: 1. A default judgment may not be entered against military service personnel on active duty. 50 U.S.C. §3931. If a default judgment is entered, it may be vacated. The SCRA requires that when a default judgment is entered in state or federal court, the attorney must file an affidavit of military service. A sample copy of Cook County Circuit Court Form CCG 0004, Affidavit as to Military Service, is available on the website of the Clerk of the Circuit Court of Cook County at www.cookcountyclerkofcourt.org/?section=FormsPage (case sensitive). 2. At the instance of any person, civil proceedings may be stayed with respect to the person on active military duty for at least 90 days. 50 U.S.C. §3931.

http://www.cookcountyclerkofcourt.org/?section=FormsPage



3. Even after a condemning body properly obtains title and possession to a building, family members of a person on active military duty may not be evicted for 90 days. 50 U.S.C. §3951. This applies to any dwelling renting for $2,400 per month or less during the period of military service for the wife, children, or other dependents of a person in military service, with certain discretion vested in the court. The maximum rent ($2,400 in 2003) to which the 90-day eviction prohibition applies is subject to a housing price inflation adjustment, which is $3,451.20 in 2016. 50 U.S.C. §3951(a)(1)(A)(ii). K. [2.13] Relocation Reimbursement Section 10-5-62 of the Eminent Domain Act provides that the condemnor will pay to persons displaced by the acquisition of their real property reimbursement for their reasonable relocation costs:

Except when federal funds are available for the payment of direct financial assistance to persons displaced by the acquisition of their real property, in all condemnation proceedings for the taking or damaging of real property under the exercise of the power of eminent domain, the condemning authority shall pay to displaced persons reimbursement for their reasonable relocation costs, determined in the same manner as under the federal Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, as amended from time to time, and as implemented by regulations promulgated under that Act. This Section does not apply to the acquisition or damaging of property under the O’Hare Modernization Act. 735 ILCS 30/10-5-62.

The amount to be paid to displaced persons is to be determined in the same manner as pursuant to the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970. Relocation reimbursement has a much broader meaning than the term “relocation” would suggest. A displaced person is entitled to payment for the cost to move, i.e., moving personal property from one place to the next. In addition, packing costs and loading and unloading are reimbursable. In certain cases, when a replacement structure is not available, storage for up to one year may be reimbursed. Other costs can include reprinting stationery and signs for a business to include the new address and disconnection and reconnection of equipment. Preparation of the new structure (e.g., tenant improvements) is not reimbursable. An unexpected feature of the federal regulations implementing the URA, now to be followed in all Illinois condemnations, is financial assistance that the condemnor must provide to certain residents when they are unable to find new safe, sanitary, and decent housing at the same cost as at the location from which they were displaced. If the new housing cannot be found at the same price, the condemnor must provide a subsidy. If this housing cannot be found at all in the community, the condemnor must provide it. This applies to renters as well as owners. Who is entitled to receive relocation reimbursement? The URA applies to all persons who are displaced by a federally supported project regardless of whether they are owners and regardless of whether their property is taken. But the terms of the EDA are not so broad. It applies to persons displaced by the “acquisition of their real property.” Id. Tenants are displaced when the condemnor acquires their landlord’s real property. Literal interpretation of the EDA would



exclude relocation payments to tenants since their real property is not being acquired. However, tenants own a stick in the bundle of real property rights. In light of this and benefits under the URA, it would seem unlikely that tenants would not receive relocation reimbursement. Like all provisions of the EDA, §10-5-62 “applies only to complaints to condemn that are filed on or after its effective date” (i.e., January 1, 2007). 735 ILCS 30/90-5-5. Read literally, this means that when a condemnor acquires property by agreement under threat of condemnation, but when no complaint is filed, displaced persons are not entitled to relocation reimbursement. The exclusion of voluntary transactions also appears in the language of §10-5-62, which provides that reimbursement is required “in all condemnation proceedings for the taking or damaging of real property under the exercise of the power of eminent domain.” [Emphasis added.] 735 ILCS 30/10-5-62. It will be difficult for condemnors to avoid reimbursement in voluntary transactions, even if §10-5-62 does not require these payments. If the condemnor refuses to pay reimbursement as part of a negotiated purchase, the owner need only refuse the deal and make the condemnor obtain the property in court, thereby forcing the payment of relocation costs. The URA not only requires that condemnors reimburse relocation costs but also establishes many procedural and substantive standards for condemnors to follow. For example, there are elaborate regulations concerning the notices to landowners, the appraisal process, and the minimum time that a person must be allowed to remain on the acquired property. Section 10-5-62 applies the URA only to “relocation costs,” which are to be “determined in the same manner as under the [URA].” Id. It remains to be seen whether the EDA language will be interpreted as adopting the federal rules to any aspect of condemnation other than relocation costs. L. [2.14] Relocation Coordinator A relocation coordinator may ease the acquisition process. A staff member or private relocation coordinator will be very helpful in facilitating the acquisition. The coordinator is a person or firm familiar with relocation law, the labyrinthine guidelines, and local moving companies. A coordinator helps displaced owners and tenants to understand their eligibility and the compensation rules and helps them apply to the public body for relocation compensation. The coordinator can do the following: Identify tenants and other parties. At the outset of a project, the relocation coordinator can visit all of the tenants and businesses in the acquisition project area. In the process of informing them of their relocation rights, the coordinator can obtain the identities of the interested parties. Inform tenants of relocation rights. The relocation coordinator can advise tenants about the kind of relocation assistance available, the procedures for obtaining this assistance, and the paperwork involved in documenting the move and applying for compensation. Determine the relocation budget. By identifying all persons eligible for relocation compensation and estimating eligible costs, the relocation coordinator can advise the condemnor as to the amount to be budgeted for relocation.



Provide easy communication with interested parties. Relocation coordinators have frequent contacts with tenants and owners in the course of advising them about and coordinating their application for relocation reimbursement. The tenants will have a contact who can answer their questions, and therefore the acquisition attorney can avoid frequent questions from unrepresented parties. The relocation coordinator, as the source of relocation reimbursement funds, appears as a friendly, generous representative of the condemning authority. In federally funded projects, the costs of a relocation coordinator are reimbursable project expenses. M. [2.15] Sixty-Day Notice Letter for State Agencies Notice of the intention to condemn must be given at least 60 days before the state or its agencies file a complaint for condemnation. 735 ILCS 30/10-5-15(d). The state and its agencies desiring to initiate condemnation must send a letter via certified mail, return receipt requested, to the owner and furnish the following information:

(1) The amount of compensation [to be offered] for the taking of the property proposed by the agency and the basis for computing it. (2) A statement that the agency continues to seek a negotiated agreement with the property owner. (3) A statement that, in the absence of a negotiated agreement, it is the intention of the agency to initiate a court proceeding under this Act. Id.

Section 10-5-15(d) of the Eminent Domain Act requires that the state agency maintain a record of the letters sent for at least one year. The contents of the notice letter appear to track the offer letter usually sent in condemnation cases but with some additional requirements. The “basis for computing” the offer must also be stated. 735 ILCS 30/10-5-15(d)(1). An appraisal report would seem to satisfy this requirement. A sample form of a 60-day notice letter is found in §2.74 below. Section 10-5-15(c) contains an additional requirement. At the time of the first contact with the property owner, whether in person or by letter, the state agency must advise the property owner in writing of the following:

(1) A description of the property that the agency seeks to acquire. (2) The name, address, and telephone number of the State official designated . . .

to answer the property owner’s question. (3) The identity of the State agency attempting to acquire the property.



(4) The general purpose of the proposed acquisition. (5) The type of facility to be constructed on the property, if any. 735 ILCS 30/10-

5-15(c). A sample form of a first-contact letter that could be sent to conform to this requirement is found in §2.73 below. Since 1991, when the 60-day notice statute was first enacted, there have been few reported appellate court decisions interpreting it, and several issues remain unresolved: 1. Is the notice requirement mandatory or directory? A statutory direction may be considered directory if it does not provide a penalty for failure to comply. Section 10-5-15(d) contains no such penalty despite its injunction to serve the notice 60 days before initiating condemnation. Thus, if a property owner seeks to base a traverse (motion to dismiss) on the state’s failure to comply with the statute precisely (such as failing to send in the manner required by the EDA or giving less than 60 days’ notice), the state may defend on the ground that the notice requirement is directory only and that failure to comply is not fatal to the take. 2. What is a “state agency” for the purpose of the statute? Agencies in the executive branch of Illinois government, such as the Illinois Department of Transportation or the Illinois Department of Natural Resources, are clearly state agencies and likely objects of the §10-5-15(d) notice requirement. These departments have blanket expropriation power, need no additional legislative authority to file condemnation, and are subordinates of the chief executive of the state. However, the statute’s application to other agencies is not so clear. The Illinois Toll Highway Authority, interstate compact agencies, and state universities are not in the executive branch of government. They are not subordinates of the Governor but are governed by statutory bodies. These entities may not be “agencies” for the purpose of the EDA. 3. How long must the state agency’s offer of purchase remain open? The sample form of a letter of a final good-faith offer in §2.80 below provides that the condemnor’s offer will terminate after 10 days. The purpose of terminating the offer is to establish that if the owner does not accept the offer, “the compensation to be paid . . . cannot be agreed upon by the parties.” 735 ILCS 30/10-5-10(a). However, the terms of §10-5-15(d) provide that the 60-day notice contain the amount of proposed compensation and a statement that “the agency continues to seek a negotiated agreement” with the owner. Nothing in this language expressly permits the offer to be terminated prior to filing condemnation. The practitioner is advised to be aware of the tension between this language and the common practice of terminating offers to purchase. The court in Forest Preserve District of DuPage County v. First National Bank of Franklin Park, 2011 IL 110759, 961 N.E.2d 775, 356 Ill.Dec. 386, found a 10-day offer period to be sufficient. 4. May the first-contact letter and the 60-day letter be combined? Sections 10-5-15(c) and 10-5-15(d) describe, respectively, the requirements of the letter to be sent on the state’s first contact with the property owner and the letter of offer. In some exigent circumstances, it may be necessary to send concurrent first-contact and offer letters or a combined first-contact and offer letter.



5. What is a first contact, and when does it occur? Is the first-contact letter to be served when the state first begins consideration of the subject site but before the decision is made that the property is necessary or desirable for the project? For example, surveys, environmental assessments, and appraisals may be needed before the state determines whether to proceed with a project. Each of these inspections necessitates contact with the property owner. Must the official first-contact letter be served at the investigation stage prior to even deciding whether to proceed with a project? The Illinois Supreme Court has construed the 60-day notice strictly. In Department of Transportation ex rel. People v. 151 Interstate Road Corp., 209 Ill.2d 471, 810 N.E.2d 1, 284 Ill.Dec. 348 (2004), the court held that once the 60-day notice is sent, the state agency cannot reduce the amount of its offer without reinstating the 60-day notice requirement. In 151 Interstate Road, the Illinois Department of Transportation had sent a 60-day notice under former 735 ILCS 5/7-102.1(d) (predecessor to §10-5-15(d) of the EDA) but subsequently reduced its offer for the property by $7,000. According to the court’s calculations, the reduction was not based on a reduced taking but was a decrease in the per-acre value being offered by IDOT. The court held that this constituted a new offer, requiring a new 60-day period. The court stated:

Meaningful negotiation will only occur if property owners believe they will be no worse off at the end of the process than they were at the beginning. If the state is permitted to do what IDOT did here, namely, to make an offer at a certain price, but then reduce the rate it is willing to pay and proceed to court before an additional 60-day period has expired, property owners will have no such assurance. The prospect of diminishing payment will intimidate some property owners, making them feel pressured to accept the state’s initial proposal and forgo further discussions for fear that they might end up receiving less and less the closer the state comes to the time when it can initiate court proceedings against them. . . . [M]eaningful bargaining will be substantially impaired. That outcome is directly contrary to the result the General Assembly hoped to achieve when it enacted section 7-102.1(d). 810 N.E.2d at 9 – 10.

Section 10-5-15(d) of the EDA requires that the 60-day notice set forth the amount of compensation for the taking and “the basis for computing it.” 735 ILCS 30/10-5-15. There is no requirement that the state submit its appraisal with its offer. Forest Preserve District of DuPage County v. First National Bank of Franklin Park, 2011 IL 110759, 961 N.E.2d 775, 356 Ill.Dec. 386. See §§2.35 and 2.45 below regarding good-faith negotiation. N. [2.16] Uniform Relocation Assistance and Real Property Acquisition Policies Act of

1970 The Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 applies to every acquisition funded in whole or in part with federal grants. As noted in §2.7 above, failure to observe the requirements of the URA does not result in the inability to acquire property, but it could result in a failure of the project because of the deprivation of federal funding. Thus, when the URA applies, it is imperative to follow it and the regulations promulgated thereunder by the various federal departments and agencies.



The URA not only requires that relocation assistance be paid to displaced owners and tenants, but it also imposes certain other procedures not otherwise required by Illinois law. The acquisition and relocation regulations for acquisitions funded by federal agencies appear at 49 C.F.R. pt. 24. These regulations apply to all property acquired in whole or in part with federal funds except those negotiated without any threat of condemnation and without designation of a specific site. The following summarizes some, but by no means all, of the applicable regulatory requirements: 1. As soon as feasible, the condemning body will notify the owner of its interest in acquiring the property and inform the owner of the basic protections under the URA, including the obligation to secure an appraisal. The obligation to inform may be satisfied by providing the federal agency’s information booklet. 2. Before the initiation of negotiations, there will be an appraisal. 3. Acquiring bodies are encouraged to obtain at least two appraisals for high-value properties or properties requiring a complicated valuation process. 4. The owner will be given an opportunity to accompany the appraiser during the appraiser’s inspection. 5. Appraisals must conform to federal agency standards, and the appraiser must be certified under state law pursuant to Title IX of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989, Pub.L. No. 101-73, 103 Stat. 183. 6. Appraisals will be subject to review by a qualified reviewing appraiser. 7. Before initiation of negotiations, the condemning body will establish an amount that it believes to be just compensation for the taking. “The amount shall not be less than the approved appraisal of the fair market value of the property” or the reviewing appraiser’s recommended fair market value. 49 C.F.R. §§24.102(d), 24.104. Promptly thereafter, the condemning body “shall make a written offer to the owner to acquire the property for the full amount believed to be just compensation.” 49 C.F.R. §24.102(d). 8. Along with the initial written purchase offer, the owner will be given a written statement of the basis for the offer, which will include the following: a. a statement of the amount offered; b. a description and location of the property to be acquired and the interest to be

acquired; and c. an identification of the buildings and other improvements to be included. 9. The condemning body is prohibited from advancing the time of condemnation, delaying negotiations of condemnation, or taking any other course of action to coerce an agreement.



10. The condemning body must have standards for the appraisal and the qualifications of appraisers. 11. The condemning body is responsible for paying recording fees, transfer taxes, and similar expenses incidental to conveying the real property. The condemning body is also responsible for the payment of penalty costs for prepayment of a mortgage and the prorated portion of real property taxes applicable to the period after acquisition of title. Under the URA, the condemnor’s offer must remain open a minimum of 30 days. See 49 C.F.R. pt. 24, app. A, Section 24.102(f) Basic Negotiation Procedures. O. Conditions Precedent to Filing 1. [2.17] Authority and Delegation of Authority To Implement Condemnation The state has the inherent power to condemn property for public use. U.S.CONST. amend. V; ILL.CONST. art. I, §15; Forest Preserve District of DuPage County v. West Suburban Bank, 161 Ill.2d 448, 641 N.E.2d 493, 204 Ill.Dec. 269 (1994). Statutes or ordinances that authorize the acquisition of property for a public project may also provide the manner for implementing the acquisition and identify the public officials responsible for carrying it out. This legislation must be specific enough to be a proper delegation of power and, if so, must have been approved. Forest Preserve District of DuPage County v. Brown Family Trust, 323 Ill.App.3d 686, 753 N.E.2d 1110, 257 Ill.Dec. 484 (2d Dist. 2001) (approving delegation to staff and attorneys of authority to negotiate voluntary sale and to institute condemnation if negotiation failed). It should be remembered that the decision to acquire must be exercised by the appropriate corporate authorities or the General Assembly. For state projects, the General Assembly has delegated the decision to acquire property to the executive branch, which exercises this authority without additional specific legislative authority. See, e.g., §4-501 of the Illinois Highway Code, which allows the Illinois Department of Transportation the authority to acquire such property as is “necessary” for highway projects, without further specificity. 605 ILCS 5/4-501. For the text of delegation ordinances approved by the court, see Brown Family Trust, supra, 753 N.E.2d at 1112 – 1113. When the city council authorized the acquisition of a parcel of land, the city could not amend its complaint to acquire an amount of property less than that authorized. City of Chicago v. Midland Smelting Co., 385 Ill.App.3d 945, 896 N.E.2d 364, 324 Ill.Dec. 578 (1st Dist. 2008) (in this case, city council enacted subsequent ordinance authorizing reduced take). 2. [2.18] Successive Condemnations A condemnation dismissed because it sought excess land does not operate as res judicata to bar a subsequent complaint to take a lesser amount of the same property. City of Chicago v. Midland Smelting Co., 385 Ill.App.3d 945, 896 N.E.2d 364, 324 Ill.Dec. 578 (1st Dist. 2008). Similarly the court in Rock River Water Reclamation District v. Sanctuary Condominiums of Rock Cut, 2014 IL App (2d) 130813, ¶48, 30 N.E.3d 1081, 391 Ill.Dec. 443, held that a second



condemnation action, based on a new authorizing ordinance, is not barred by the earlier dismissal of the condemnation based on defects in the first ordinance. 3. [2.19] Prerequisites for New Quick-Take Authority The Illinois House of Representatives established prerequisites for enacting new quick-take authority. The rules apply to the state as well as to units of local government. See Illinois House Rule 41, 99th Gen.Assem. (2015). Rule 41 provides that before the Illinois House of Representatives will consider legislation authorizing additional quick-take powers under 735 ILCS 30/20-5-5, the state agency or unit of government requesting this authority must notify affected owners by certified mail, publish notice, and hold a public hearing. Thereafter, the corporate authorities, if a unit of local government, must adopt a resolution requesting the General Assembly to add quick-take powers. Then, not less than 30 days after giving notice, the head of the state agency or local government must file documentation certifying that the procedures have taken place and identifying the property and the owners that will be affected. Among the documents required to be submitted are appraisals of the affected property. Rule 41 expires at the end of the 99th General Assembly, on December 31, 2016, but these provisions, or others like them, have been in effect since 2003 and are expected to be reenacted by subsequent General Assemblies. This application procedure can be expensive and time-consuming. However, the impact of Rule 41 can be reduced by good planning. As a practical matter, the General Assembly passes most legislation only two or three times a year with a January session, a late June session, and a November veto session. Governments or agencies requesting new quick-take legislation should submit their applications well in advance of these passages dates. 4. [2.20] Quick-Take — What Is a Formally Adopted Schedule or Plan of Operation? Section 20-5-5(b) of the Eminent Domain Act requires that a quick-take motion state the “formally adopted schedule or plan of operation for the execution of the plaintiff’s project.” 735 ILCS 30/20-5-5(b). In City of Chicago v. St. John’s United Church of Christ, 404 Ill.App.3d 505, 935 N.E.2d 1158, 1172, 343 Ill.Dec. 930 (2d Dist. 2010), the city had no specific schedule for the acquisition of the owner’s parcel. The court held that the “formally adopted schedule” requirement was satisfied by the city’s statement that the parcel was needed for a new runway, for which construction would begin in July 2010 and be completed in 2012. It is unclear if this schedule, although set out in the city’s motion, was formally adopted and, if so, by whom. But the city was held to have satisfied the requirement because it submitted a “specific timeline for the specific project” and the O’Hare modernization project is a massive project involving construction of many elements over many acres over the course of many years. 935 N.E.2d at 1173. Plans for a project of that size change over many years, and the rule that the condemnor is permitted to acquire for future needs applies.



5. [2.21] Availability of Funds Not Condition Precedent to Filing Petition It is not a condition precedent to the filing of a condemnation petition that the condemnor have the money immediately available to pay for the property sought to be acquired. This principle was restated in County of St. Clair v. Wilson, 284 Ill.App.3d 79, 672 N.E.2d 27, 219 Ill.Dec. 712 (5th Dist. 1996). In Village of Depue v. Banschbach, 273 Ill. 574, 113 N.E. 156, 159 – 160 (1916), the court said:

It is further urged that the proceedings were defective for the reason that no provision had been made for payment for the lands taken and damaged. The fact that no tax had been levied or provision made to raise funds to pay for the improvement is no concern to the appellant. City of Chicago v. Sanitary District, 272 Ill. 37, 111 N.E. 491. He is not required to give credit to the municipality or part with his land until he is paid in full the compensation awarded him by the verdict of the jury and judgment of the court. City of Chicago v. Sanitary District, supra. . . . It is immaterial to the rights of appellant that such funds were not in its treasury at the time this proceeding was instituted, so long as they are there at the time his lands are taken.

See also Forest Preserve District of Cook County v. Chicago Title & Trust Co., 351 Ill. 48, 183 N.E. 819 (1932). In fact, if the ultimate award exceeds what the condemnor is willing to pay, the condemnor may dismiss or abandon the petition provided it has not taken possession of the property pursuant to a quick-take order (in which case abandonment or dismissal is not permitted). See 735 ILCS 30/10-5-70; Department of Public Works & Buildings ex rel. Illinois v. Greenlee, 63 Ill.App.2d 425, 211 N.E.2d 771 (2d Dist. 1965). Of course, §10-5-70 of the Eminent Domain Act requires the payment of costs, expenses, and attorneys’ fees upon abandonment or dismissal. In City of Chicago v. St. John’s United Church of Christ, 404 Ill.App.3d 505, 935 N.E.2d 1158, 343 Ill.Dec. 930 (2d Dist. 2010), the appellate court upheld the trial court’s refusal to grant discovery on the issue of whether the city had the ability to pay for the project for which it sought to acquire the owner’s land. 6. [2.22] Final Plans of Project Not Condition Precedent to Filing Petition A corollary to the principle described in §2.21 above (i.e., that the availability of funds is not a condition precedent to filing a condemnation petition) is the principle that asserts that plans for the project for which land is being acquired need not be final before condemnation may be commenced. City of Chicago ex rel. Schools v. Albert J. Schorsch Realty Co., 127 Ill.App.2d 51, 261 N.E.2d 711 (1st Dist. 1970). In Department of Transportation v. Keller, 127 Ill.App.3d 976, 469 N.E.2d 262, 265, 82 Ill.Dec. 728 (5th Dist. 1984), the court noted:

Respondents also contend that petitioner was without authority to exercise the powers of eminent domain since the construction plans offered as evidence at the hearing were not “final plans.” The record indicates, however, that the State’s plans



were final to the extent that circumstances would reasonably allow. The fact that the Department of Transportation could not offer extensive plans for every parcel of land sought in the acquisition, or for every phase of a project which would extend over a period of several years, did not deprive the department of authority to condemn the various tracts. Neither was the department required, as respondents suggest, to obtain, prior to acquiring title, every permit which might be required in the course of construction.

The principle that condemnation is authorized for a public purpose, even if specific plans have not been formulated in detail, is also applicable to quick-take. The First District Appellate Court rejected the argument that such a principle was applicable only in a non-quick-take condemnation proceeding. The court held that even if “extensive plans” might not be available or even if a project might extend over a period of years, this situation did not deprive the condemning body of authority to condemn, even in a quick-take action. City of Chicago v. First Bank of Oak Park, 178 Ill.App.3d 321, 533 N.E.2d 424, 428, 127 Ill.Dec. 552 (1st Dist. 1988). The condemnor need not identify the funding sources of the project for which the property is being acquired. In South Park Commissioners v. Livingston, 344 Ill. 368, 176 N.E. 546, 547 (1931), the owner alleged that the condemning authority “was without the necessary funds and had made no appropriation or levy to develop the property for park purposes or for any purpose within its charter powers.” Similarly, the owner challenged the taking on the ground that the condemning authority “never adopted any plan for the use of the land nor made an appropriation for it, and that the court was unable to pass upon the sufficiency of the money available for the construction of the work.” Id. The Illinois Supreme Court held that these were not proper issues to challenge an eminent domain taking. It is permissible to acquire property for anticipated needs. In Alsip Park District v. D & M Partnership, 252 Ill.App.3d 277, 625 N.E.2d 40, 192 Ill.Dec. 80 (1st Dist. 1993), the appellate court upheld the acquisition of additional land for a park when there was disputed evidence on the issues of whether the land was needed now, whether there were specific plans, and whether other land might better fulfill the district’s immediate needs. The appellate court quoted City of Chicago v. Vaccarro, 408 Ill. 587, 97 N.E.2d 766, 772 (1951), in which the Illinois Supreme Court approved of acquisitions that “anticipate the future increased demands for the public use to which the land is to be devoted.” 625 N.E.2d at 46. However, a condemnor can go too far in the court’s eyes. See County of St. Clair v. Faust, 278 Ill.App.3d 152, 662 N.E.2d 584, 214 Ill.Dec. 1018 (5th Dist. 1996), in which the court held that the county’s acquisition was limited to the minimum acreage necessary for its purposes and that the amount sought grossly exceeded those needs. The courts allow the condemning body wide latitude in establishing the ultimate use for the property to be condemned. One court has even gone as far as to say that “recent cases suggest that a legislative finding of necessity by a city council is not required to defeat a traverse.” City of Oakbrook Terrace v. LaSalle National Bank, 186 Ill.App.3d 343, 542 N.E.2d 478, 482, 134 Ill.Dec. 299 (2d Dist. 1989). While this statement is an observation not the ratio decidendi of the case, the court reiterated the principle that an eminent domain action may be maintained although the ultimate use of the condemned property has not yet been determined. A further instance of this principle is State of Illinois Medical Center Commission v. United Church of the Medical



Center, 142 Ill.App.3d 498, 491 N.E.2d 1327, 1329, 96 Ill.Dec. 867 (1st Dist. 1986), in which the court upheld the taking even though the condemning body could prove no more definite use than for “medical institutional expansion.” The taking was upheld despite the fact that no use or prospective user had been identified, either in the authorizing resolution or by evidence in the traverse hearing. One court has even gone as far as to state that the failure to “pass a specific resolution before filing its complaint in condemnation” is a nonfatal defect if the condemning authority presents evidence at the traverse hearing showing that the taking is necessary. County of Wabash v. Partee, 241 Ill.App.3d 59, 608 N.E.2d 674, 680, 181 Ill.Dec. 601 (5th Dist. 1993). Thus, although it is better for the legislature to make a finding of necessity in the authorizing legislation, the lack of a finding is not fatal as long as necessity is proven at trial. Rock River Water Reclamation District v. Sanctuary Condominiums of Rock Cut, 2014 IL App (2d) 130813, ¶64, 30 N.E.3d 1081(“even if we were to interpret the 2010 Ordinance as lacking a statement of necessity, this would not necessarily be fatal as long as plaintiff made a showing of necessity at the hearing on the traverse”). To satisfy the requirement of showing necessity, the condemnor need not offer up plans for every parcel or every phase of a public project. City of Chicago v. St. John’s United Church of Christ, 404 Ill.App.3d 505, 935 N.E.2d 1158, 343 Ill.Dec. 930 (2d Dist. 2010). Similarly, an owner may not challenge the necessity to acquire its property on the ground that there is an alternate way to accomplish the condemnor’s purpose without acquiring its property. Id. As a corollary, a condemnor may acquire land not only for its immediate needs but also for its anticipated future needs. Id. The owner’s offer to use the property for the same purpose for which the condemnor seeks the property does not defeat the necessity to take the property for such purpose. City of Chicago v. Midland Smelting Co., 385 Ill.App.3d 945, 896 N.E.2d 364, 324 Ill.Dec. 578 (1st Dist. 2008). 7. [2.23] Prior Notice Not Condition Precedent to Filing Petition — Other than by

State Agencies Although owners frequently allege that they had no prior notice that their property might be taken, prior notice is not required. “[E]very private owner of property holds his title subject to the lawful exercise of the sovereign power of eminent domain.” Deerfield Park District v. Progress Development Corp., 22 Ill.2d 132, 174 N.E.2d 850, 853 (1961). Except in the case of state agencies (see §2.15 above) no specific prior notice is required. Of course, all formalities relating to notice of public meetings must be observed to ensure that the authorizing legislation was properly passed. Notice can be a two-edged sword. Advance notice can give property owners sufficient time to plan to move. On the other hand, lengthy notice, particularly if there is not a particular date set for the acquisition, can cause uncertainty for property owners. Lengthy notice can cause a decline in property values. See, e.g., Chicago Housing Authority v. Lamar, 21 Ill.2d 362, 172 N.E.2d 790 (1961). It is even possible that the public project will not proceed (e.g., because of lack of funds), leaving the property owner with no recourse. See City of Chicago v. Loitz, 61 Ill.2d 92, 329



N.E.2d 208 (1975). Notice too far in advance can cause tenants to vacate, leaving the owner with no rental income while waiting for condemnation to be approved or completed. 8. [2.24] Delay in Instituting or Prosecuting Condemnation Action Not Fatal Frequently, there is a significant lapse of time between the planning of a project and the actual acquisition of the property required for it. In the case of highways, the recording of the highway centerline project usually occurs relatively early in the planning stages. The result is that the centerline appears as a title objection long before the condemnor seeks to acquire the affected property, which may make the property unmarketable. Public knowledge of the imminence of other kinds of projects has a similar effect. When a property is targeted for expropriation, an owner may be unable to sell it and unwilling to maintain it until acquisition occurs. When there is lengthy delay, the landowner is often left without any practical remedy since these precondemnation activities by the condemnor do not constitute a taking that would obligate the condemnor under the Illinois and U.S. Constitutions to compensate the owners of the affected property. See City of Chicago v. Loitz, 61 Ill.2d 92, 329 N.E.2d 208 (1975); Kirby Forest Industries, Inc. v. United States, 467 U.S. 1, 81 L.Ed.2d 1, 104 S.Ct. 2187 (1984); Griffin v. City of North Chicago, 112 Ill.App.3d 901, 445 N.E.2d 827, 831, 68 Ill.Dec. 183 (2d Dist. 1983) (“no taking occurs until the execution of a purchase agreement or conclusion of eminent domain proceedings”). In Patel v. City of Chicago, 383 F.3d 569 (7th Cir. 2004), the court reaffirmed the principle that the designation of properties for acquisition has no legal impact on these properties; challenges to these designations are not ripe. In Patel, the plaintiffs were owners of motels that the city found to be deteriorated. The motels were singled out for acquisition under the City of Chicago’s Lincoln Avenue tax increment financing district ordinance. The owners challenged the condemnation designation on TIF and equal-protection grounds, alleging that motels, as distinct from other properties in the district, were singled out for acquisition and that the city council’s designation was a malicious attempt to punish the motel owners without any legitimate governmental objective. The Seventh Circuit held that if the owners’ complaint was for a taking, their recourse would be an action in state court for inverse condemnation. On the other hand, an equal-protection claim was also premature under Williamson County Regional Planning Commission v. Hamilton Bank of Johnson City, 473 U.S. 172, 87 L.Ed.2d 126, 105 S.Ct. 3108 (1985). Equal protection could not be used to avoid the finality requirements of Williamson. The court in Patel found that since the plaintiffs alleged no protected class violations, the claims were nothing more than land use claims, which, under Williamson, must await a final local decision. Patel reiterates the principle, citing Supreme Court and Seventh Circuit precedent, that governmental acquisition activities short of filing condemnation or a physical invasion of the property are not actionable under the Fifth Amendment. In contrast to prefiling immunity, the courts may dismiss the action in egregious cases of delay following the filing of a complaint for condemnation. See, e.g., Department of Public Works & Buildings v. Vogt, 51 Ill.App.3d 770, 366 N.E.2d 310, 9 Ill.Dec. 53 (5th Dist. 1977); Department of Conservation v. Cox, 95 Ill.App.3d 1126, 420 N.E.2d 1061, 51 Ill.Dec. 503 (5th



Dist. 1981). Because of irreparable harm that may be caused to the landowner before a complaint is filed and the risk of dismissal afterward, filing and prosecuting a condemnation action should proceed expeditiously. In City of Quincy, Illinois v. Diamond Construction Co., 327 Ill.App.3d 338, 762 N.E.2d 710, 261 Ill.Dec. 141 (4th Dist. 2002), the court did not approve the city’s sandbagging the owner by letting the owner move and then seeking to value the property as vacant. Under the Eminent Domain Act, delay during trial is less likely, or, if delay occurs, it is less likely to harm the owner. The EDA provides incentives for the condemnor to expedite trial. The EDA establishes that the property in condemnation is to be valued as of the date the complaint was filed; however, if trial does not occur within two years of the filing, the court may advance the valuation date to the date of trial. 735 ILCS 30/10-5-60. This usually leads to a higher valuation. 9. [2.25] Approval of Illinois Commerce Commission for Acquisition of Public Utility

Property Section 10-5-10(g) of the Eminent Domain Act requires that a condemnor obtain permission from the Illinois Commerce Commission before acquiring public utility property by eminent domain:

No property [with certain exceptions] belonging to a railroad or other public utility subject to the jurisdiction of the Illinois Commerce Commission may be taken or damaged, pursuant to the provisions of [the Article VII of] this Act, without the prior approval of the Illinois Commerce Commission. 735 ILCS 30/10-5-10(g).

Similarly, a motion for vesting title in a quick-take condemnation pursuant to 735 ILCS 30/20-5-5(b) requires prior approval for the acquisition by the Illinois Commerce Commission. The EDA is silent as to what standards the Illinois Commerce Commission should use in considering whether to grant approval. There is a dearth of caselaw; one court has simply declared that the purpose of the approval requirement “is to insure that property necessary for utility purposes is not taken.” Department of Conservation v. Chicago & North Western Transportation Co., 59 Ill.App.3d 89, 375 N.E.2d 168, 170, 16 Ill.Dec. 537 (2d Dist. 1978). In addition to the lack of standards, it is also unclear whether this requirement is jurisdictional or may be waived by agreement. The one certainty is that the condemning body is assured of two condemnation proceedings for each utility parcel. Therefore, the attorney and the client must make allowances for additional preparation required by both an Illinois Commerce Commission and a circuit court proceeding. 10. [2.26] Special Considerations — Railroad Property For railroad property, additional regulatory approval must be sought. In order for a railroad to abandon trackage, it must receive the permission of the Surface Transportation Board (STB) of the United States Department of Transportation. 49 U.S.C. §10903. The STB is the successor to the Interstate Commerce Commission. By regulation, the STB has exempted rail property inactive



for two years from the purview of the statute. 49 C.F.R. §§1152.50, 1152.60. For acquisition of exempt property not in active rail use, certification to the STB is given by the railroad itself. Note that it is often impossible to determine by casual inspection whether a rail line is in use. Although a line may appear to be abandoned or to have little or no use, it nevertheless may not have met the qualifications for exemption. State condemnation, if it involves substantial interests in railroad property, is preempted by federal statute because it would unreasonably interfere with railway use. In Union Pacific R.R. v. Chicago Transit Authority, 647 F.3d 675 (7th Cir. 2011), the court held that the Chicago Transit Authority’s proposed state condemnation proceedings would affect a railroad company’s actively used railroad property and thus would constitute an unreasonable interference and exceeded what was permitted under the ICC Termination Act (ICCTA), Pub.L. No. 104-88, 109 Stat. 1028. Accordingly, the condemnor must apply to the STB for approval to institute a major condemnation of railroad property that interferes with railroad operations. P. [2.27] Condemnation for Use by Another Governmental Entity — Intergovernmental

Cooperation The courts have approved the acquisition of property by one agency for conveyance to another agency. In Department of Transportation of State of Illinois v. Callender Construction Co., 305 Ill.App.3d 396, 711 N.E.2d 1199, 238 Ill.Dec. 538 (4th Dist. 1999), the Illinois Department of Transportation built a highway through a conservation area and sought to replace it by acquiring a conservation easement over other private property. The court, citing the Intergovernmental Cooperation Act, 5 ILCS 220/1, et seq., held that the acquisition was necessary for the highway even though the conservation easement was to satisfy an agreement with the Illinois Department of Conservation. See also City of Chicago v. Gorham, 80 Ill.App.3d 496, 400 N.E.2d 42, 35 Ill.Dec. 905 (1st Dist. 1980) (approving City of Chicago acquisition of property for state office building). Q. [2.28] Condemnation of Property of Another Public Entity — Municipal Acquisition

of Public Property Section 11-61-2 of the Illinois Municipal Code permits municipalities to acquire property belonging to certain other public entities when the acquisition will not materially impair or interfere with the use already existing and will not be detrimental to the public. 65 ILCS 5/11-61-2. In Village of Woodridge v. Board of Education of Community High School District 99, 403 Ill.App.3d 559, 933 N.E.2d 392, 342 Ill.Dec. 806 (2d Dist. 2010), the school district held property for future use. The appellate court held that there was no already existing use that would prevent the village from acquiring the property. R. [2.29] Preservation of Status Quo While Condemnation Is Pending Condemnation may be used to preserve a threatened natural resource, a historic property, or any existing improvement that the condemning body desires to retain. In Forest Preserve District of DuPage County v. West Suburban Bank, 161 Ill.2d 448, 641 N.E.2d 493, 204 Ill.Dec. 269 (1994), the Illinois Supreme Court upheld an injunction issued by the trial court preventing the landowner from converting pristine prairie land into parking lots. Although the actual take is not



complete until after a verdict, judgment, and deposit of funds, the court may issue an injunction to preserve features of the property for which the property is being acquired. When property is at imminent risk of destruction and the public agency intends to acquire it for preservation of a resource or historic structure, a complaint for condemnation may be filed to allow a court to issue an injunction preserving the status quo. Note that in order to file a complaint, there must already be in existence a statute, ordinance, or other authority authorizing acquisition; the acquisition must be for a public purpose; and the statutory requirements for condemnation, principally the attempt to agree, must already be in place or have occurred. One impediment to this methodology for a state agency is the 60-day notice requirement of 735 ILCS 30/10-5-15. As discussed in §2.15 above, §10-5-15 provides no penalty for noncompliance. Thus, it can be argued that the section is directory, not mandatory. Even if the complaint for condemnation would be premature, the courts may preserve the status quo pending the filing of condemnation. Forest Preserve District of Cook County v. Mount Greenwood Bank Land Trust 5-0899, 219 Ill.App.3d 524, 579 N.E.2d 1066, 162 Ill.Dec. 252 (1st Dist. 1991). S. [2.30] Notice of Right-of-Way Designation and Advance Acquisition Pursuant to 605 ILCS 5/4-510, the Illinois Department of Transportation may designate a proposed highway right-of-way. The designation has several purposes: it notifies landowners that their land is likely to be acquired for a highway; it prohibits new development on the proposed right-of-way that would increase acquisition costs; and it forces IDOT to decide whether to acquire the property when new development is proposed. After public notice and a hearing, IDOT records an alignment map showing property lines and identifying owners of record along the right-of-way. IDOT then publishes public notice and notifies owners of record that it recorded the map. Thereafter, an owner is required to notify IDOT 60 days before any improvement or development of the property. IDOT has 45 days following notice to determine whether to acquire the property through the exercise of eminent domain. If IDOT decides to acquire, it has 120 days to initiate the purchase. If IDOT declines to acquire, the owner may develop the property and must be compensated for the improvement if the property is eventually acquired. But, if the owner fails to give notice, the property will be valued as if no further development had occurred. Id. The filing of a highway right-of-way map permits the Department of Transportation to stop development on land to be acquired. Before an owner can start development, there is effectively a 165-day moratorium, consisting of the 45-day decision period and the 120-day period allowed for IDOT to commence acquisition. This moratorium would not constitute a taking without compensation. The mere planning or plotting in anticipation of a public improvement is not a taking or damage to the affected property. Davis v. Brown, 221 Ill.2d 435, 851 N.E.2d 1198, 1205, 303 Ill.Dec. 773 (2006). See also Tahoe-Sierra Preservation Council, Inc. v. Tahoe Regional Planning Agency, 535 U.S. 302, 152 L.Ed.2d 517, 122 S.Ct. 1465 (2002). The courts continue to hold that planning activities, even those freezing development or threatening condemnation, do not amount to a taking. In Davis v. Brown, 221 Ill.2d 435, 851 N.E.2d 1198, 303 Ill.Dec. 773 (2006), the Illinois Supreme Court upheld §4-510 of the Illinois Highway Code (605 ILCS 5/4-510) against an attack on Fifth Amendment grounds. The highway law authorized the Illinois Department of Transportation to prepare and record maps with



proposed highway alignments. A property owner within a proposed alignment was prohibited from undertaking development without giving notice to IDOT and providing the agency 165 days to consider whether to acquire the property. Similarly, the Illinois appellate court upheld the DuPage Forest Preserve District’s reservation of the right to condemn against a regulatory taking challenge. In Stahelin v. Forest Preserve District of DuPage County, 376 Ill.App.3d 765, 877 N.E.2d 1121, 315 Ill.Dec. 792 (2d Dist. 2007), the owner complained that it was denied the economic benefit of its property when the district first filed a condemnation suit, dismissed it, and then passed an ordinance reserving the right to condemn the property in the future. The court found that these actions were planning in anticipation of a possible future taking and were thus not actionable. T. [2.31] Prefiling Contacts with the Owner It is good public policy and good public relations for the condemning body to inform the owner at an early date that acquisition of the owner’s property is probable. This early notice will give the owner adequate time to plan to move and will avoid surprises. The regulations promulgated under the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 require that, for federally funded projects, the owner must be informed of his or her rights and the condemnation procedures. Pursuant to 49 C.F.R. §24.203, landowners must be informed of the length of time they will be permitted to occupy condemned property, the right to present evidence regarding value, and the relocation benefits that may be expected. This information is ordinarily provided by the condemning state agency through the use of a form letter and an enclosed booklet outlining the condemnee’s rights and obligations. Even for projects to which the URA does not apply, it is good policy for the staff of the condemning body to make early contact with affected property owners concerning the impending condemnation. The condemning attorney should carefully monitor the staff’s communication with landowners. It is important not to give this notice to owners whose property will not be taken and not to give the notice too early. In addition to other effects, notification of condemnation can adversely affect property owners by making the properties unmarketable or discouraging investment in improving or maintaining their properties to be acquired. See also the ethical considerations noted in §2.39 below regarding communications with a property owner. U. [2.32] Records of Conversations Perhaps attorneys need not be reminded of the necessity for keeping notes and records of contacts with owners and their attorneys. Questions occasionally arise about whether an attempt to agree occurred. An attorney’s notes concerning telephone calls from and meetings with the owner or the owner’s attorney will be helpful in confirming that the offer was received and that an attempt was made to agree. Similarly, one can keep a record of the parties’ latest position on a settlement amount. With many parcels in a project, it is difficult to commit to memory the latest prices being discussed in negotiations. Adequate notes will allow the attorney to avoid mistakes and to refresh the attorney’s recollection in case there is a dispute as to whether the owner received an offer or the condemnor failed to negotiate.



PRACTICE POINTER

The regulations under the Uniform Relocation Assistance and Real Property Acquisition

Policies Act of 1970 require that written records be maintained of all contacts with owners.

V. [2.33] Prefiling Inspection Contact with the property owner is required at the appraisal stage. The regulations promulgated under the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 require that the property owner be given notice that an appraiser will be inspecting the affected property. 49 C.F.R. §24.102. The owner should be given the opportunity to accompany the appraiser on the inspection. For federally funded projects, this is a requirement. Cooperation of the owner is also essential in order to inspect the interior of the property. Until a complaint for condemnation is filed, discovery is unavailable. Therefore, the appraiser will be unable to enter nonpublic portions of private property without the invitation of an owner or occupant.

PRACTICE POINTER

For highway projects, the Illinois Highway Code authorizes the state to inspect property irrespective of permission. 605 ILCS 5/4-503. Note that the Code requires that the state will be responsible for all damages occasioned thereby.

It is increasingly important for the condemnor to know whether the property to be acquired is polluted. The condemning body should know whether the property is currently or was in the past used as the site of potentially contaminating activities, whether underground storage tanks exist, and whether the property is otherwise contaminated. The problem is that the owner may be unwilling to reveal any of this information. The usual kind of environmental inspection, a Phase I audit, may be conducted by an environmental consultant. A Phase I audit requires a review of public records. However, except for certain state acquisitions, soil tests and onsite inspections may be conducted only with the owner’s consent before initiation of a condemnation proceeding. A sample form of a letter notifying the property owner of the imminence of condemnation and requesting an inspection is found in §2.75 below. W. Attempt To Agree as to Compensation 1. [2.34] Attempt To Agree a Prerequisite The Eminent Domain Act evidences the public policy of encouraging voluntary acquisitions of property and discouraging forced acquisitions through the exercise of eminent domain. Patrick Media Group, Inc. v. DuPage Water Commission, 258 Ill.App.3d 1068, 630 N.E.2d 958, 196 Ill.Dec. 793 (1st Dist. 1994). 735 ILCS 30/10-5-10(a) requires that a complaint for condemnation may not be filed unless the condemnor cannot agree with the interested parties as to the amount



of compensation to be paid for the property sought to be appropriated or damaged unless the owner of the property is incapable of consenting, his or her name or residence is unknown, or he or she is a nonresident of the state. The inability to agree must be alleged in the complaint for condemnation. City of Chicago v. Collin, 302 Ill. 270, 134 N.E. 751 (1922); Trustees of Schools v. Clippinger, 404 Ill. 202, 88 N.E.2d 451 (1949).

PRACTICE POINTER

The offer to purchase may be sent at any time, even before any other formal action to acquire the property has been taken. In City of Oakbrook Terrace v. LaSalle National Bank, 186 Ill.App.3d 343, 542 N.E.2d 478, 134 Ill.Dec. 299 (2d Dist. 1989), the court upheld the validity of the city’s offer to purchase even though the offer was sent before the city had enacted an ordinance authorizing condemnation. The property owner noted that the ordinance that was eventually enacted authorized the city attorney to undertake negotiations to purchase (as these ordinances usually do) and, if the negotiations should prove unsuccessful, to initiate condemnation. However, the offer was transmitted before the enactment of the ordinance. The property owner challenged the offer on the ground that it was not the offer authorized by a later-enacted ordinance. The court upheld the validity of the preordinance offer, noting that there is good reason to hold these negotiations valid even if they precede an authorizing ordinance. If the negotiations were successful, they would eliminate the necessity for city council action. Such an offer satisfies the Eminent Domain Act because it facilitates the amicable conveyance of the property.

2. [2.35] Condemnation Following Unsuccessful Negotiations by the Expected

Developer It is understood that the offer prerequisite to acquisition must be made in good faith. Department of Transportation ex rel. People v. 151 Interstate Road Corp., 209 Ill.2d 471, 810 N.E.2d 1, 7, 284 Ill.Dec. 348 (2004). Is good faith lacking when condemnation proceeds after negotiations by private purchasers fail? Property acquired in connection with a redevelopment project is sometimes conveyed to a developer for private development. In order to avoid condemnation costs and in hopes of saving money and time, the prospective developer often tries to negotiate the purchase of the needed property prior to the initiation of condemnation by the governmental body. Because the private developer lacks condemnation power, the property owner may refuse to accept a price that the developer considers reasonable. After failure to reach an agreement with the property owner, the private developer will call on the government to use its eminent domain powers to force a reluctant owner to sell and to do so for a reasonable price. The exercise of the government’s power of expropriation to support private development and to force an unwilling owner to sell at a price the private developer believes to be more reasonable may appear to be an abuse of power. In Illinois State Toll Highway Authority v. DiBenedetto, 275 Ill.App.3d 400, 655 N.E.2d 1085, 211 Ill.Dec. 702 (1st Dist. 1995), the property owner challenged the acquisition on the ground that the condemnor, acting through a third party, had



made an inadequate offer, thus demonstrating that the offer had been made in bad faith. Homart Development Company, an eventual private beneficiary of the public project, initially offered to purchase the property at a price equivalent to only 66 percent of the condemnor’s (official) subsequent offer. The court found that the Homart offer was not made on behalf of the condemnor and was not so low as to be in bad faith. Justice Zwick, concurring, argued, however, that the Homart offer was bad practice and not in good faith. The property owner in City of Chicago v. Boulevard Bank National Ass’n, 293 Ill.App.3d 767, 688 N.E.2d 844, 228 Ill.Dec. 146 (1st Dist. 1997), alleged that bad faith occurred when the intended developer asked the city to condemn after the developer was unable to obtain the property through private negotiations. The court upheld the condemnation without considering the allegations of bad-faith negotiations. In Village of Skokie v. Gianoulis, 260 Ill.App.3d 287, 632 N.E.2d 106, 198 Ill.Dec. 47 (1st Dist. 1994), a bank attempted to negotiate a purchase of the Gianoulis’ property. When negotiations failed, the bank sought to have the village condemn the property for it as part of an existing redevelopment project. While the appellate court described the purchase attempt, it did not rule on it. Instead, the court found that there was no authority to condemn because the property had not been included in the original acquisition ordinance. The final word is that of the Illinois Supreme Court. In Southwestern Illinois Development Authority v. National City Environmental, L.L.C., 199 Ill.2d 225, 768 N.E.2d 1, 263 Ill.Dec. 241 (2002), the court found such an acquisition to violate the public use provision of the United States and Illinois Constitutions. The owner of a motor raceway (originally developed with the support of the Southwestern Illinois Development Authority (SWIDA)) failed in its attempt to purchase a neighboring property for additional patron parking. SWIDA then attempted to condemn the property for the purpose of conveying it to the raceway. The Illinois Supreme Court held that SWIDA’s condemnation was not for a public purpose. 3. [2.36] Who May Submit the Condemnor’s Offer? It probably does not matter who submits the offer to purchase as long as it is clear that the offerer is acting on behalf of the condemnor. In state cases, it may be a highway engineer; in other cases, it may be the chief executive officer, the head of the planning department, or the condemnor’s attorney. See Forest Preserve District of DuPage County v. Brown Family Trust, 323 Ill.App.3d 686, 753 N.E.2d 1110, 257 Ill.Dec. 484 (2d Dist. 2001), for an ordinance specifically authorizing particular officers to negotiate a purchase of property on behalf of the condemnor. 4. [2.37] Testing the Sufficiency of the Attempt The sufficiency of the attempt to agree on compensation to be paid is a preliminary question that must be challenged by a traverse (motion to dismiss). City of Evanston v. Piotrowicz, 20 Ill.2d 512, 170 N.E.2d 569 (1960). If not traversed, the objection is waived, and the court may proceed to determine just compensation. People ex rel. White v. Busenhart, 29 Ill.2d 156, 193 N.E.2d 850 (1963); Chicago Housing Authority v. Berkson, 415 Ill. 159, 112 N.E.2d 620 (1953). If the allegations of the petition to condemn required by 735 ILCS 30/10-5-10 are not included in



the petition, the objection thereto may be raised by a motion to dismiss because the court may not proceed to determine the just compensation to be paid unless the petition complies with the statutory jurisdictional allegations. Department of Public Works & Buildings v. Lewis, 344 Ill. 253, 176 N.E. 345 (1931). 5. [2.38] Form Indicating Attempt To Agree In order to avoid the question of a good-faith attempt to agree, a wise practice for the condemnor is to make a final offer by letter referring to the negotiations between the condemnor’s agent and the landowner, concluding by advising the owner that if the offer is not accepted within a stated number of days, it must be concluded that the parties cannot agree on compensation to be paid for the taking. Such a letter is sufficient to prove adequate negotiations if no response is received by the condemnor. Peoples Gas Light & Coke Co. v. Buckles, 24 Ill.2d 520, 182 N.E.2d 169 (1962); Village of Deerfield v. Rapka, 54 Ill.2d 217, 296 N.E.2d 336 (1973); Illinois State Toll Highway Authority v. Karn, 9 Ill.App.3d 784, 293 N.E.2d 162 (2d Dist. 1973). A sample form of a final good-faith offer letter is found in §2.80 below. Note that the letter of offer (a) describes the property sought to be acquired, (b) describes the interest sought to be acquired, (c) offers a sum certain for the interest sought, and (d) sets a specific time within which a response is requested. While none of these elements is specifically required by statute, the incorporation of these elements into the letter of offer will generally simplify proof of an attempt to agree should the issue later be raised in the condemnation proceedings. Written records of attempts to agree should be kept, including notes of telephone calls with the owner or owner’s representative. Also, the written offer should be sent by certified mail, return receipt requested. Outside negotiators should keep memoranda of all contacts with the owner. 6. [2.39] Conferences with Unrepresented or Represented Defendant The condemnor’s attorney should be mindful of potential conflicts when communicating with an owner. The letter of offer (or other precondemnation contacts) will frequently bring an immediate telephone call from a landowner. Unsophisticated owners will have many questions, such as the imminence of the acquisition, how long they can stay on their property, how much money they can expect, how much money the condemning body has appropriated to purchase their property, and how they should go about establishing a value for it. Since the condemning attorney is, by nature of the assignment, in an adversarial position to the owner, the attorney must be very careful about these direct contacts with the owner. On the one hand, as a representative of a public body, the attorney will want to furnish to the owner truthful and informative data concerning the history of the acquisition project and general aspects of the condemnation procedure. On the other hand, the condemning attorney does not want to be in the position of giving legal advice to an adversary. In particular, the condemning attorney does not want to leave the landowner with the impression that the attorney is representing him or her. Illinois Rule of Professional Conduct 4.3 states:

In dealing on behalf of a client with a person who is not represented by counsel, a lawyer shall not state or imply that the lawyer is disinterested. When the lawyer



knows or reasonably should know that the unrepresented person misunderstands the lawyer’s role in the matter, the lawyer shall make reasonable efforts to correct the misunderstanding.

Another rule, RPC 4.2, prohibits contact with an adversarial party if the party is represented by counsel, providing that “a lawyer shall not communicate about the subject of the representation with a person the lawyer knows to be represented by another lawyer in the matter” without obtaining the prior consent of the other lawyer. Accordingly, one of the first questions the condemning attorney should ask is whether the owner is represented by counsel. If the owner is represented by counsel, the condemning attorney should advise the owner of the requirements of RPC 4.2 and that the owner’s attorney should contact the condemning attorney as soon as possible. 7. [2.40] Terminating the Negotiations Almost any good-faith attempt to agree will be considered in compliance with 735 ILCS 30/10-5-10(a). Nevertheless, care should be taken to terminate the negotiations if they cannot lead to a settlement so that it may be demonstrated that the compensation “cannot be agreed upon by the parties interested.” Id. In one of the few cases in which an appellate court found that the state had not demonstrated that the parties were unable to agree, the state negotiators had failed to respond to a counteroffer submitted by the owner in response to the negotiator’s offer. Failure to reject the counteroffer was evidence that the attempt to agree was continuing. Department of Transportation v. Walker, 80 Ill.App.3d 1039, 400 N.E.2d 956, 36 Ill.Dec. 376 (3d Dist. 1980). Contra County of Wabash v. Partee, 241 Ill.App.3d 59, 608 N.E.2d 674, 682, 181 Ill.Dec. 601 (5th Dist. 1993) (“The offer was not responded to. Therefore, the county was under no obligation to continue to negotiate further.”). 8. [2.41] Waiver The landowner’s filing of a cross-petition for damages to the land not taken constitutes a waiver of the question of whether there has been a failure to agree on compensation to be paid. Fayette County v. Whitford, 365 Ill. 229, 6 N.E.2d 157 (1936); Chicago N.S. & M.R. Co. v. Chicago Title & Trust Co., 328 Ill. 610, 160 N.E. 226 (1928). 9. [2.42] Multiple Owners, Incompetents, and Nonresidents When there is more than one owner, proof of the inability to settle with an owner is sufficient to satisfy the requirements of an attempt to agree. Public Service Co. of Northern Illinois v. Recktenwald, 290 Ill. 314, 125 N.E. 271 (1919); Trustees of Schools of Township No. 37 v. First National Bank of Blue Island, 49 Ill.2d 408, 274 N.E.2d 56 (1971). When the owner of property is incapable of consenting, when his or her name or residence is unknown, or when he or she is a nonresident of the state, a petition to condemn may be filed, and no attempt to agree in this instance is required. 735 ILCS 30/10-5-10(a).



10. [2.43] Standards for Finding an Attempt To Agree Although in some reported decisions the courts use the word “negotiations” in the context of an attempt to agree (see, e.g., Department of Transportation v. Platolene ‘500’, Inc., 33 Ill.App.3d 470, 337 N.E.2d 100 (4th Dist. 1975)), it appears that a mere offer to purchase the property will suffice as an attempt to agree. In County Board of School Trustees of Macon County v. Batchelder, 7 Ill.2d 178, 130 N.E.2d 175, 178 (1955), the court stated:

Defendants’ contention that there was a failure to prove inability to agree on compensation before the petition was filed must likewise be rejected. By letter addressed to defendants they were offered the sum of $500 for their land, and no reply was made to the letter. Under such circumstances no further attempt to negotiate was necessary. There was sufficient effort on the part of the Board to agree with defendants.

Thus, the focal point is an attempt to agree. Under appropriate circumstances, an offer may not even be required. For example, in County Board of School Trustees of DuPage County v. Boram, 26 Ill.2d 167, 186 N.E.2d 275 (1962), the landowner was adamant that he would accept only a certain figure that the condemnor was not willing to pay, and it was thus clear from the acts of the parties that an offer would be futile. In Davis v. Northwestern El. Ry., 170 Ill. 595, 48 N.E. 1058, 1059 (1897), the court said:

It was contended that the court had no jurisdiction to entertain the petition unless there was proof of the failure on the part of the petitioner to be able to agree with the lot owner as to the amount of compensation. The pleadings show that defendants were nonresident, and that certain of them were minors. In such case it is not necessary to show by proof that the compensation and damage could not be agreed upon. The minors could not make an agreement.

Generally, a landowner will seek a higher price for his or her property if he or she is aware that it is needed for a public improvement, and it could, therefore, be advantageous for a condemnor to attempt to acquire the necessary property without revealing its true identity. However, the condemnor may not fulfill the “attempt to agree” requirement by seeking to acquire the property through an undisclosed agent. Pittsburgh, C., C., & St. L. Ry. v. Gage, 280 Ill. 639, 117 N.E. 726 (1917). A refusal of one of the owners to agree to sell will generally excuse the condemnor from making any further effort to agree. In St. Louis & C.R. Co. v. Postal Tel. Co. of Illinois, 173 Ill. 508, 51 N.E. 382, 387 (1898), the lessee was unwilling to agree to the construction of a telegraph line on its property. The court stated:

As the Mobile & Ohio Railroad Company had a lease of the right of way, which was not to expire for 34 years, a refusal on its part to allow the appellee to construct its telegraph line rendered such construction impossible, without reference to what the lessor, the St. Louis & Cairo Railroad Company, might have to say in the matter. . . . Where an owner refuses to sell altogether, negotiation as to the amount



of compensation is thereby cut off. . . . It is not necessary that there should be a series of efforts, or a prolonged negotiation, in order to agree upon compensation; an effort to agree is all that is required.

The condemnor is not required to wait for an unlimited period of time to allow the owner to make up his or her mind. In Mercer County v. Wolff, 237 Ill. 74, 86 N.E. 708, 711 (1908), the court stated:

The appellants object that it is essential to allege and prove that the petitioner cannot agree with the owners upon the compensation to be paid, and that the evidence shows that they could agree with Prentiss, and that Wolff was negotiating with the county when the petition was filed. Whether or not the petitioner could agree with Prentiss did not affect the appellants. Wolff had declined to accept the offer of the county; and, while it is true that he stated that he could not give an answer within a week, the county board was not compelled to wait that length of time. If he would not accept the offer, that was a failure to agree.

An offer to purchase extended by the condemning body’s attorney is considered bona fide even though the amount offered by the attorney is subject to later approval by the governing board of the condemnor. The Eminent Domain Act simply requires an attempt to agree, and Illinois courts have never held that a condemnation offer must be the same as a legally binding offer in private estate cases. Lake County Forest Preserve District v. First National Bank of Waukegan, 200 Ill.App.3d 354, 558 N.E.2d 721, 146 Ill.Dec. 758 (2d Dist. 1990). The time in which the owner has to react to the condemnor’s offer may be as little as 10 days. The court so held in Forest Preserve District of DuPage County v. First National Bank of Franklin Park, 2011 IL 110759, 961 N.E.2d 775, 356 Ill.Dec. 386. Whatever may be an acceptable time under Illinois law for an agency to allow an owner to consider the offer, 30 days is the minimum under the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970. 49 C.F.R. pt. 24, app. A, Section 24.102(f) Basic negotiation procedures. Whether the condemnor used a flawed appraisal report as the basis for negotiating compensation is relevant to the issue of good-faith negotiation. People ex rel. Department of Transportation v. Kotara, L.L.C., 379 Ill.App.3d 276, 884 N.E.2d 1235, 318 Ill.Dec. 964 (3d Dist. 2008). An appraisal may not satisfy the good-faith requirement if it does not follow the Uniform Standards for Professional Appraisal Practice or does not comply with the state’s own Land Acquisition Manual. Id. The condemnor is only required to conduct negotiations with the owner of the property. Other parties having in interest in the property, even those having an interest in the eventual award of just compensation, need not be brought into the negotiations. Department of Transportation v. Anderson, 384 Ill.App.3d 309, 892 N.E.2d 116, 322 Ill.Dec. 869 (3d Dist. 2008), noting that §10-5-10 of the Eminent Domain Act only requires negotiation with the “owner of the property.” The Anderson court also held that an interested party, other than the owner, may not contest the amount of preliminary just compensation in a quick-take proceeding, a dubious proposition.



11. [2.44] Good-Faith Offer — Reasonableness of the Amount A mere difference of opinion as to value will not disqualify an offer. Department of Transportation ex rel. People v. Brownfield, 221 Ill.App.3d 565, 582 N.E.2d 209, 164 Ill.Dec. 1 (3d Dist. 1991). Nevertheless, Illinois courts continue to frown on lowball offers. In City of Naperville v. Old Second National Bank of Aurora, 327 Ill.App.3d 734, 763 N.E.2d 951, 261 Ill.Dec. 702 (2d Dist. 2002), the court affirmed a dismissal of the complaint for condemnation because of the condemnor’s failure to make a good-faith offer. The City of Naperville had offered the owners $200,000 despite the value of $500,000 determined by the city’s own appraiser. The court all but said that the appraisal value must be offered: “[G]ood faith requires that the condemning authority offer a price that correlates to the fair market value of the property as determined by the condemning authority.” [Emphasis added.] 763 N.E.2d at 957. By this reasoning, the condemnor would have to show why market value of the property was less than its appraisal in order to justify offering a lesser amount. The offer must be carefully drawn and must be supported by an appraisal or other substantial indication of value. Caselaw has interpolated the requirements of bona fides and good faith into the simple “attempt to agree” language of §10-5-10(a) of the Eminent Domain Act, 735 ILCS 30/10-5-10(a). In the past, virtually any offer transmitted by the condemnor could be considered acceptable, even under the standards of bona fides and good faith. However, off-the-wall offers without a sufficient basis in fact violate the standard and will be subject to a motion to dismiss. In Forest Preserve District of Will County v. Marquette National Bank, 208 Ill.App.3d 823, 567 N.E.2d 635, 638, 153 Ill.Dec. 677 (3d Dist. 1991), the forest preserve district’s offer was held to be insufficient. The district submitted a “windshield” appraisal. The so-called appraisal ignored recent rezonings, offers to purchase, and investments of capital. The amount offered was grossly insufficient. The court upheld the dismissal based on the district’s failure to meet the statutory requirements. See also City of Chicago v. Zappani, 376 Ill.App.3d 927, 877 N.E.2d 17, 315 Ill.Dec. 530 (1st Dist. 2007). There are no fixed guidelines for judging how high an offer must be in order for it to meet the requirement of good faith. For example, in City of Oakbrook Terrace v. LaSalle National Bank, 186 Ill.App.3d 343, 542 N.E.2d 478, 134 Ill.Dec. 299 (2d Dist. 1989), the court found valid an offer that was almost one fifth the value sought by the property owner. It should be noted that in Oakbrook Terrace, the city’s offer was supported by an appraisal. But see City of Springfield, Illinois v. West Koke Mill Development Corp., 312 Ill.App.3d 900, 728 N.E.2d 781, 245 Ill.Dec. 699 (4th Dist. 2000), in which a $200 offer, even in light of a $54,925 jury verdict, was not, without more, evidence of the city’s failure to negotiate in good faith. The Illinois Supreme Court has clarified what is required for a good-faith offer. Although many appellate courts have held that the condemnor’s attempt to agree must be in good faith, the Illinois Supreme Court has stated definitively that “the Eminent Domain Act requires the condemnor to negotiate with the landowner in good faith over the amount of compensation to be paid before it initiates proceedings to take the landowner’s property through eminent domain.” Department of Transportation ex rel. People v. 151 Interstate Road Corp., 209 Ill.2d 471, 810 N.E.2d 1, 7, 284 Ill.Dec. 348 (2004). The court further noted that a disparity between the owner’s and the condemnor’s views does not indicate that an offer was not made in good faith. In 151 Interstate Road, the court rejected the owner’s argument that the offer, based on an appraisal, was



not in good faith because the appraiser lacked credentials, there was weakness in the appraiser’s analysis, and the appraiser did substantial business with the state. Since the appraisal was performed by a licensed appraiser with 15 years of experience who followed accepted methodology and did not deviate from professional standards, the offer was not lacking in good faith despite the appraiser’s opinion being substantially lower than that of the owner. Thus, an offer based on a competent appraisal meets the standard of good faith. The issue was clarified somewhat by the Illinois Supreme Court in Forest Preserve District of DuPage County v. First National Bank of Franklin Park, 2011 IL 110759, ¶63, 961 N.E.2d 775, 356 Ill.Dec. 386, in which the court held that an offer “based on the advice of an experienced appraisal consultant” establishes a good-faith attempt to agree. It would seem to offer a safe harbor if the condemnor offers to purchase at the full appraised value. In Forest Preserve District of DuPage County, the court approved an offer that was ten percent below the condemnor’s appraisal (although the district received a lower appraisal after it submitted its offer). In Forest Preserve District of DuPage County, the court held that there is no need for the condemnor to submit its appraisals to the owner when it transmits its offer to purchase.

PRACTICE POINTER

Although the state is not required to furnish them when it sends its offer to purchase, the state’s appraisals are frequently available for the asking. The owner’s attorney should request a copy of the appraisals, including any review appraisals. The attorney representing the state should have no problem with this request, since the appraisals would be subject to disclosures in discovery and pursuant to the Freedom of Information Act, 5 ILCS 140/1, et seq.

12. [2.45] Successful Negotiations — Acquisition by Agreement After successful negotiations, the property may be acquired by contract to convey. The contract may be in the usual form of a real estate buy-sell agreement. The closing of the sale may be accomplished as in ordinary private transactions. It is customary (required in federal cases) for the condemnor to pay the owner’s closing costs.

PRACTICE POINTER

An owner’s voluntary sale may not convey all interests in the property. In certain circumstances, it may not be advisable for the condemnor to acquire property through a buy-sell agreement even if the parties are in agreement as to the price. An owner may not be able to furnish good title or may be unable to deliver all of the interests in the property. This is particularly true when the property is burdened by easements, tenants, or other occupants. In these cases, the condemning authority succeeds to the position of the seller. The condemnor becomes the landlord and must still deal with the holders of easements, tenants, and other occupants.



13. [2.46] Voluntary Conveyance Even if negotiated under the threat of condemnation, voluntary sales by the owner have the attributes of an ordinary conveyance, not a condemnation. In Patrick Media Group, Inc. v. DuPage Water Commission, 258 Ill.App.3d 1068, 630 N.E.2d 958, 196 Ill.Dec. 793 (1st Dist. 1994), the Illinois appellate court held that the commission’s termination of a lease on purchased property was not a taking for which compensation was due. Under threat of condemnation, the water commission purchased land that had been leased for use by the billboard company. After the conveyance, the water commission sent a termination notice pursuant to the lease. The court held that the lease was terminated by contract law, not condemnation. Relying on Patrick Media, the court in Kleinschmidt Inc. v. County of Cook, 287 Ill.App.3d 312, 678 N.E.2d 1065, 223 Ill.Dec. 57 (2d Dist. 1997), held that the question of the condemnor’s authority to condemn was irrelevant to the validity of a voluntary conveyance. Cook County purchased the plaintiff’s property under threat of condemnation. It later conveyed part of the property to a third party to substitute for property taken from that party. The plaintiff sued to undo the original conveyance because the county’s reconveyance of the property was not for public use. The court found that the public-use argument was not relevant because the conveyance was considered voluntary despite having occurred under threat of condemnation. A consent judgment in a condemnation case is treated differently than a contract to convey. In City of Marseilles v. Radke, 287 Ill.App.3d 757, 679 N.E.2d 125, 223 Ill.Dec. 181 (3d Dist. 1997), the parties agreed to a consent judgment in a condemnation case. The property owner had a change of heart and moved to vacate the consent judgment on the ground that the city had no authority to condemn since the subject property was outside the boundaries of the project for which condemnation was being exercised. The appellate court agreed, holding that the boundary question was jurisdictional, so the trial court had no jurisdiction to entertain condemnation or to enter a consent decree. These cases suggest that a voluntary conveyance (but not necessarily a consent judgment), even under threat of condemnation, trumps any procedural errors or substantive questions of the authority to condemn. The Public Officer Prohibited Activities Act, 50 ILCS 105/0.01, et seq., requires that “[b]efore any contract relating to any ownership or use of real property is entered into by and between the State or any local governmental unit . . . the identity of every owner and beneficiary having any interest . . . in such property . . . must be disclosed.” 50 ILCS 105/3.1. The Act provides the details concerning the size of interest that must be disclosed and how disclosure should be made. The disclosed property ownership interests include those of any parent entity. The settlement amount of a voluntary conveyance is not admissible at trial. The condemning body need not avoid a voluntary conveyance for fear that the amount might be used to establish compensation at the trial of other parcels in a project. Compensation paid under threat of condemnation is not considered a voluntary sale. Board of Trustees of University of Illinois v. Shapiro, 343 Ill.App.3d 943, 799 N.E.2d 383, 389, 278 Ill.Dec. 665 (1st Dist. 2003), citing Forest Preserve District of Cook County v. Krol, 12 Ill.2d 139, 145 N.E.2d 599 (1957), and Oak Brook Park District v. Oak Brook Development Co., 170 Ill.App.3d 221, 524 N.E.2d 213, 120 Ill.Dec.



448 (2d Dist. 1988). Even if not admissible at trial, the amount paid is a matter of public record and is likely to be considered by both sides in negotiations for the acquisition of subsequent parcels.

PRACTICE POINTER

The Public Officer Prohibited Activities Act also makes it unlawful for any appointed or elected official to have a financial interest in a contract that the officer might be called on to vote for. 50 ILCS 105/3. In the contract of conveyance for the acquisition of any real property, it is useful to have the owner disclaim any interest in the property or its proceeds by a public officer. This can be done by inserting in the contract a section that paraphrases the relevant portions of §3 of the Act.

14. [2.47] Alternate Acquisition by Purchase of Mortgage or Other Lien Rights In addition to condemnation and voluntary sale, a governmental body may acquire real property by nontraditional or innovative means. For example, for distressed property, a governmental body may deem it advisable to take over a creditor’s or lienholder’s position, such as by purchasing a mortgage in foreclosure. These alternate methods have received court approval. The manner by which the forest preserve district may acquire land for its purposes is “by gift, grant, legacy, purchase or condemnation.” 70 ILCS 810/8. The power to create forest preserves is exercised in order to “protect[] and preserv[e] the flora, fauna, and scenic beauties . . . and to restore, restock, protect and preserve the natural forests . . . for the purpose of the education, pleasure, and recreation of the public.” Baker v. Forest Preserve District of Cook County, 2015 IL App (1st) 141157, ¶40, 33 N.E.3d 745, 393 Ill.Dec. 1 (approving forest preserve district’s acquisition through purchase and foreclosure of mortgage), quoting 70 ILCS 810/7. Note that such a purchase gives the government no greater rights than the mortgagor or other lienholder. The mortgage, for example, could be subject to the mortgagor’s defenses and the delays attendant to foreclosure. 15. [2.48] Statements by Public Officials — Are They Binding? Public officials may have opinions of value or the highest and best use of property being acquired. Is a public body bound by these expressions? In County of St. Clair v. Wilson, 284 Ill.App.3d 79, 672 N.E.2d 27, 219 Ill.Dec. 712 (5th Dist. 1996), the condemnee tried to introduce the statement of the county board chairman concerning highest and best use. The statement was asserted to be the admission of the condemning body. One of the problems with this assertion was that a single person’s “admission” cannot be binding as official policy of a public body. The court found the chairman’s statement too general and not specifically related to the property at issue in the case. Therefore, it was not admissible as documentation of the highest and best use in the acquisition proceeding.



III. COMPLAINT FOR CONDEMNATION A. [2.49] Source and Purpose If the parties cannot agree on the compensation to be paid for the acquisition of property, the Eminent Domain Act permits the court to determine compensation upon the filing of a complaint for condemnation. 735 ILCS 30/10-5-10(a). The EDA governs the substance and procedure of eminent domain proceedings. What is now correctly denominated the “complaint for condemnation” had traditionally been known as a “petition to condemn.” It has been said that the sole object of a complaint for condemnation of property for public use is to ascertain the compensation to be paid for taking or damaging the property, and the amount of compensation is the only issue. Department of Public Works & Buildings of State of Illinois v. Sohm, 315 Ill. 478, 146 N.E. 518 (1925). Nevertheless, a complaint for condemnation has several other practical effects. Upon judgment and deposit of the award, the petition establishes title in the condemnee as against all persons properly made parties who appear or have been served and defaulted. In addition, the same court that had jurisdiction to establish the amount of just compensation may retain jurisdiction to grant the condemnee possession of the property. The foregoing functions are frequently sought in the complaint’s prayers for relief. Another function of the complaint for condemnation is to apportion the award among interested parties. In the condemnation action, just compensation is established for the property as a whole. When the award of just compensation is deposited with the county treasurer, the court, upon application of the parties, has the authority to order distribution of the award among interested parties, such as the owner of the fee, lessees, mortgagees, lienholders, and the treasurer acting as tax collector. The power to distribute the award is implicit in 735 ILCS 30/10-5-10, which requires that all interested parties be joined in the action. Distribution among interested parties also appears expressly in 735 ILCS 30/10-5-90. B. [2.50] Elements of the Complaint for Condemnation The complaint for condemnation is the initial pleading filed by the condemnor and must follow certain strict requirements. The basic outline and requirements are found in §10-5-10(a) of the Eminent Domain Act:

The complaint shall set forth, by reference, (i) the complainant’s authority in the premises, (ii) the purpose for which the property is sought to be taken or damaged, (iii) a description of the property, and (iv) the names of all persons interested in the property as owners or otherwise, as appearing of record, if known, or if not known stating that fact; and shall pray the court to cause the compensation to be paid to the owner to be assessed. 735 ILCS 30/10-5-10(a).

Caselaw has interpreted and broadened these requirements. A sample form of a complaint for condemnation is found in §2.76 below. This form may be used for ordinary as well as quick-take condemnation. Quick-take has been said to be a



“proceeding within a proceeding.” Department of Public Works & Buildings v. Dust, 19 Ill.2d 217, 166 N.E.2d 36, 38 (1960). After filing a complaint for condemnation, the condemning body may file a motion for immediate vesting (735 ILCS 30/20-5-5(b)) to gain early title and use of the property. Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 250 Ill.App.3d 665, 619 N.E.2d 1321, 189 Ill.Dec. 272 (2d Dist. 1993). The complaint might also specify which of the standards of 735 ILCS 30/5-5-5 the condemnor chooses to proceed under, as does the sample form in §2.76 below. The EDA does not appear to force an election at the time of filing the complaint, however, and it might preserve the condemnor’s flexibility to avoid making the choice until the owner raises an objection. While local practice and the practitioner’s style may alter the suggested wording, §§2.51 – 2.62 below may be considered a checklist of the required elements of a condemnation petition. 1. [2.51] Name in Which the Action Is Brought The case should be filed under the corporate name of the condemnor, such as “The Board of Trustees of the University of Illinois,” “The Department of Transportation, State of Illinois,” or “The City of Kankakee, an Illinois municipal corporation.” Under the School Code, 105 ILCS 5/1-1, et seq., when a school district is the condemning body, the case is brought in the name of the school board for the use of the condemning school district. 105 ILCS 5/16-6. In Chicago, the suit would be in the name of “The City of Chicago in Trust for the Use of Schools.” 2. [2.52] Necessary Parties Defendant The Eminent Domain Act requires that the complaint name as defendants “all persons interested in the property as owners or otherwise, as appearing of record, if known, or if not known stating that fact.” 735 ILCS 30/10-5-10(a). This statement is deceptively simple. If a party is not named, the action is a nullity to this party. Chicago & N.W. Ry. v. Miller, 251 Ill. 58, 95 N.E. 1027 (1911). Therefore, the list of defendants should include any person or entity known to the condemnor who has any interest in the subject property. In some cases the condemnor will be aware of a party not shown of record, such as a tenant under an unrecorded lease. Any such party should be named. The following is a list of types of parties that should be included as defendants: a. parties revealed of record, including spouses; b. lienholders and judgment creditors when the judgment has been recorded as a lien against

the property; c. beneficiaries of trusts, if known (If not known, they should be included as “unknown

owners.” Beneficiaries of land trusts need not be included. Chicago Land Clearance Commission v. Darrow, 12 Ill.2d 365, 146 N.E.2d 1 (1957); Department of Conservation v. Franzen, 43 Ill.App.3d 374, 356 N.E.2d 1245, 1 Ill.Dec. 912 (2d Dist. 1976). Under the older holdings, executors and administrators having no legal title to land were not necessary parties. Highway Com’rs of Town of Ross v. Chambers, 265 Ill. 113, 106 N.E. 492 (1914). However, under §20-1(a) of the Probate Act of 1975, 755 ILCS 5/1-1, et seq., which places possession of real estate in the personal representative during the



period of administration or until possession is granted to the rightful heir or devisee by the court (755 ILCS 5/20-1(a)), it would appear better practice to make the personal representative a party to condemnation actions.);

d. guardians of incompetents whose interests in the property are affected; e. remaindermen, if known, otherwise listed as “unknown owners,” when the record

indicates a remainder interest; and f. parties in possession. NOTE: The above list is intended to be illustrative rather than exhaustive.

PRACTICE POINTER

While a party in possession may not be revealed in the title search, the interest is obvious and should be revealed to the condemnor through the process of viewing the property and negotiations prior to the filing of the petition.

It is common, although probably not necessary, to have as a party the county collector, who has an interest in the property with respect to real estate taxes. 3. [2.53] Unknown Owners Section 10-5-10(d) of the Eminent Domain Act provides: “Any interested persons whose names are unknown may be made parties defendant by the same descriptions and in the same manner as provided in other civil cases.” 735 ILCS 30/10-5-10(d). Unknown owners are named as parties to avoid the problem of ascertaining parties in interest when the record is not clear or when either the state of the record or the use and possession of the subject property indicate to the condemnor that not all interests are shown in the record. The use of the term “unknown owners” does not relieve the pleader from ascertaining the necessary parties according to the definition in the EDA. The burden of naming the right parties is on the condemnor, which will be bound by its pleading on this point. Department of Public Works & Buildings of State of Illinois v. Sohm, 315 Ill. 478, 146 N.E. 518 (1925). As in other civil cases, in order to serve unknown owners, an affidavit must be filed, and then service must be obtained by publication. 735 ILCS 30/10-5-25, 5/2-206, 5/2-207, 5/2-413. Note, however, that if the complaint for condemnation omits the name of an interested party whose name is actually known or whose name could reasonably have been ascertained, service on this person cannot be obtained by publication. Pursuant to 735 ILCS 5/2-401(c), all parties must be named in the body of the complaint. It is essential that all interested persons be made parties; otherwise, the condemnor risks having an unnamed party appear after the termination of the proceedings to ask for possession and compensation. See Wehde v. Regional Transportation Authority, 237 Ill.App.3d 664, 604



N.E.2d 446, 178 Ill.Dec. 190 (2d Dist. 1992). Even in case of a judgment by agreement, unknown owners are not bound unless it appears on record that they were properly served but did not appear and an order of default was entered. An affidavit as to unknown owners pursuant to 735 ILCS 5/2-206 stating in conclusory terms that there are persons who have an interest in the property but whose identities are unknown will not support an order of default in which the identities of the defaulted persons can be learned with the exercise of diligence. In Algonquin v. Lowe, 2011 IL App (2d) 100603, 954 N.E.2d 228, 352 Ill.Dec. 368, persons with interest in the property had been defaulted after being served by publication. The appellate court held that the condemnor had not made an effort to find the property owners; therefore, the affidavit as to unknown owners was insufficient to permit service by newspaper publication. Nevertheless, failure to join all parties has no effect on the proceedings with respect to the persons who have been joined. In Department of Transportation v. Collins, 69 Ill.App.3d 269, 387 N.E.2d 6, 9, 25 Ill.Dec. 549 (3d Dist. 1979), the court stated:

It has long been the rule that the omission of a necessary party does not invalidate a condemnation proceeding as against those who are made parties, but rather the only consequence is that, as against the omitted party, the proceeding is nugatory.

4. [2.54] Statement of Authority The Eminent Domain Act provides that the petition must set forth clearly the authority under which the condemnor is exercising the right of eminent domain: “The complaint shall set forth, by reference . . . the complainant’s authority in the premises.” 735 ILCS 30/10-5-10. This may be satisfied by specific reference to the enabling legislation or statutory grant of authority in cases involving the State of Illinois, its departments, or a political subdivision of the state. For condemning bodies other than the state and its departments, the complaint should state, in addition to the state constitutional or statutory authority, the specific resolution or ordinance adopted by the corporate authorities or governing body that authorizes the acquisition. For utilities under the jurisdiction of the Illinois Commerce Commission, reference must be made to the order of the Commission granting authority to file the proceedings. Peoples Gas Light & Coke Co. v. Buckles, 24 Ill.2d 520, 182 N.E.2d 169 (1962). In Trotter v. Spezio, 349 Ill.App.3d 959, 812 N.E.2d 577, 285 Ill.Dec. 757 (3d Dist. 2004), the court rejected the owner’s contention that the taking was improper because the complaint failed to cite one of the statutes authorizing the acquisition. Reference to a particular statute was omitted in the complaint, but the court held nevertheless that the record showed that “[t]here was no surprise to the landowners” regarding the basis for the take. 812 N.E.2d at 580. Despite this, it is wise to refer to all statutes and ordinances that authorize the take.



PRACTICE POINTER

Note the consequences if the owner succeeds in traversing the complaint. If the owner

wins a dismissal for want of authority, it is entitled to attorneys’ fees. Village of Cary v. Trout Valley Ass’n, 297 Ill.App.3d 63, 696 N.E.2d 1154, 231 Ill.Dec. 583 (2d Dist. 1998).

5. [2.55] Statement of Purpose The statement of purpose requirement in 735 ILCS 30/10-5-10(a) is met by an allegation that the taking is for an allowable public use. The exact nature of the proposed use is not required (East Peoria Sanitary Dist. v. Toledo, P. & W. R.R., 353 Ill. 296, 187 N.E. 512 (1933)), but the petition may set forth the plan in detail to limit the remainder damages the landowner may seek as a result of the proposed use. The risk here is that the petition binds the condemnor on this point. Trunkline Gas Co. v. O’Bryan, 21 Ill.2d 95, 171 N.E.2d 45 (1960). 6. [2.56] Statement of Necessity The petition must allege that the taking is necessary for the public use intended. It is not required that the allegation be supported by such facts as would be required to make a prima facie case (Department of Public Works & Buildings v. Lewis, 411 Ill. 242, 103 N.E.2d 595 (1952)), but the courts reserve the right to question necessity when challenged (Deerfield Park District v. Progress Development Corp., 22 Ill.2d 132, 174 N.E.2d 850 (1961); Forest Preserve District of DuPage County v. Illinois Commerce Commission, 12 Ill.2d 319, 146 N.E.2d 27 (1957) (determination of necessity was questioned by Commerce Commission when permission of Commission was required before property under its jurisdiction could be condemned)). In a quick-take proceeding, the condemning body must establish, as a preliminary matter, the right and necessity to exercise eminent domain, just as in an ordinary condemnation action. Pursuant to 735 ILCS 30/20-5-5(b), the condemning body must allege the necessity for the taking. The court must determine as a threshold matter “that the plaintiff has authority to exercise the right of eminent domain, that the property sought to be taken is subject to the exercise of that right, and that the right of eminent domain is not being improperly exercised in the particular proceeding.” 735 ILCS 30/20-5-10(b). Quick-take does not involve a stricter standard of necessity than an ordinary eminent domain action. In City of Chicago v. First Bank of Oak Park, 178 Ill.App.3d 321, 533 N.E.2d 424, 427, 127 Ill.Dec. 552 (1st Dist. 1988), the court noted that there were no differences between the two proceedings in this respect:

[O]ther than the burden upon the condemnor of showing immediate need for the property sought, there is no stricter standard applicable in a quick-take proceeding.

The First District Appellate Court’s holding in First Bank of Oak Park was approved by the Illinois Supreme Court in Department of Transportation v. First Galesburg National Bank & Trust Co., 141 Ill.2d 462, 566 N.E.2d 254, 152 Ill.Dec. 567 (1990).



It is essential that the complaint allege all of the elements necessary to establish the condemnor’s right to acquire the property. If it does, it will obviate the need to present evidence on the issue of the right to acquire. The government may be required to present a prima facie showing of reasonable public necessity only if the property owner files a traverse. City of Chicago v. American National Bank & Trust Company of Chicago, 146 Ill.App.3d 784, 497 N.E.2d 413, 100 Ill.Dec. 435 (1st Dist. 1986). The well-pleaded allegations of necessity are conclusive and may not be challenged in the same proceeding absent a traverse. At the same time, if a traverse (motion to dismiss) is filed, some objections may be cured later. It is clearly the safer course for both the condemnation complaint and the governing body of the condemnor by law to describe specifically the purpose and necessity for the acquisition. Nevertheless, the absence of a legislative finding of necessity would not be fatal if it is otherwise unequivocally established by the evidence in the record that the property is necessary for a public purpose. People ex rel. Director of Finance v. Young Women’s Christian Association of Springfield, 86 Ill.2d 219, 427 N.E.2d 70, 55 Ill.Dec. 950 (1981); State of Illinois Medical Center Commission v. United Church of Medical Center, 142 Ill.App.3d 498, 491 N.E.2d 1327, 96 Ill.Dec. 867 (1st Dist. 1986). Thus, insufficient legislative findings may sometimes be cured in an evidentiary hearing on the owner’s traverse. 7. [2.57] Necessity — Replacement Property It seems settled that for certain purposes, the authority to condemn includes the power to condemn replacement property. “Replacement property” is property not related to the project for which the power is exercised but acquired to replace land condemned for a project. The necessity for replacement often occurs in highway projects and is specifically authorized. See §4-509 of the Illinois Highway Code, 605 ILCS 5/4-509, authorizing the replacement of public property taken for a project. Thus, if a school must be acquired for a highway, the Illinois Department of Transportation is authorized to condemn other lands for use as a replacement school. Similarly, IDOT may condemn a conservation easement for another agency (e.g., the Illinois Department of Natural Resources) to replace a nature reserve taken for a highway. Department of Transportation of State of Illinois v. Callender Construction Co., 305 Ill.App.3d 396, 711 N.E.2d 1199, 238 Ill.Dec. 538 (4th Dist. 1999). It is not certain whether the same authority exists to condemn replacement property for the use of a private party, outside of special statutory authority. For example, §4-511 of the Illinois Highway Code, 605 ILCS 5/4-511, permits the acquisition of land to replace such buildings as factories taken for a highway, provided that the replacement is within one mile. Similar authority exists in the Metropolitan Pier and Exposition Authority Act, 70 ILCS 210/1, et seq., and the O’Hare Modernization Act, 620 ILCS 65/1, et seq. (see 70 ILCS 210/2; 620 ILCS 65/15), but it is questionable whether the authority to condemn private property to replace other private property is valid. In Southwestern Illinois Development Authority v. National City Environmental, L.L.C., 199 Ill.2d 225, 768 N.E.2d 1, 263 Ill.Dec. 241 (2002), the Illinois Supreme Court found that the condemnation of land from one person for development by another (private) person is not a public use and therefore violated the Fifth Amendment. Perhaps this principle will not apply when the condemnation supports an acquisition for a governmental use such as a highway, a convention center, or an airport. In City of Chicago v. Midland Smelting Co., 385 Ill.App.3d 945, 896 N.E.2d 364, 324 Ill.Dec. 578 (1st Dist. 2008), the appellate court approved the concept of replacement or substitute



condemnation. It approved the city’s acquisition of the owner’s property to convey it to another person to replace property that the city had condemned in an earlier proceeding, noting Illinois precedent for the practice. The court also distinguished Southwestern Illinois Development Authority, supra, on the ground that the city’s acquisition was for the benefit of the public. 8. [2.58] Failure To Agree on Compensation Failure to agree on compensation is jurisdictional; failure to agree through negotiation is a prerequisite to maintaining an eminent domain action in Illinois. 735 ILCS 30/10-5-10(a). The complaint should allege that the condemnor has attempted to agree as to compensation but has been unsuccessful. 9. [2.59] Description of Property Sought The description of the property to be taken must not leave doubt as to the boundaries or the nature and extent of the interest taken; a verdict based on an uncertain description may be held void. Central Illinois Public Service Co. v. Rider, 12 Ill.2d 326, 146 N.E.2d 48 (1957). While the landowner is to raise any objection to the legal description (Chicago, O. & P. Ry. v. Rausch, 245 Ill. 477, 92 N.E. 300 (1910)) and cannot raise such an objection for the first time on appeal (Forest Preserve District of Cook County v. Lehmann Estate, Inc., 388 Ill. 416, 58 N.E.2d 538 (1944)), the burden rests on the condemnor, for if the land is not described, it is not condemned. Therefore, the legal description should be reviewed with the surveyor or plan engineer before preparing the complaint. Numerous parcels may be included in a single complaint for condemnation. It perhaps goes without saying that the property described in the complaint must lie within the area authorized for acquisition. In City of Marseilles v. Radke, 287 Ill.App.3d 757, 679 N.E.2d 125, 223 Ill.Dec. 181 (3d Dist. 1997), the property sought to be condemned was neither alleged in the complaint nor proved at trial to be within the tax increment financing district for which it was being acquired. Since there was no authority to acquire property outside the boundaries of the TIF district, the appellate court held that there was no jurisdiction for the condemnation; therefore, a consent condemnation judgment could be vacated. However, in Village of Round Lake v. Amann, 311 Ill.App.3d 705, 725 N.E.2d 35, 244 Ill.Dec. 240 (2d Dist. 2000), the court held that a description is not inaccurate if it is less than the fee (such as a public right-of-way) or if it reserves certain interests. An erroneous legal description may not be corrected after the complaint is filed. In Forest Preserve District of DuPage County v. Miller, 339 Ill.App.3d 244, 789 N.E.2d 916, 273 Ill.Dec. 742 (2d Dist. 2003), the forest preserve district enacted an ordinance to acquire the Rodenburg Marsh. The ordinance contained both a metes and bounds description and a plat map. Although the metes and bounds description described the marsh, the plat map omitted a portion of the marsh. The court held that the ordinance could not authorize the taking of the marsh because of the discrepancy between the two legal descriptions.



After the complaint to condemn was filed, the forest preserve district discovered the error and passed a new ordinance fully describing the area to be acquired. The court held that the new ordinance was ineffective because the complaint had no proper condemnation authority when it was filed, and the subsequent ordinance correction could not cure the error. 10. [2.60] Description of Interest Sought The interest taken — whether fee simple or a lesser estate — must be specified. In most cases, the condemning body will be seeking a fee interest. Frequently, however the condemnation will be for a lesser interest, such as a construction easement, an easement for a transmission line, or the extinguishment of access rights. In any condemnation, the petition should clearly set forth the exact estate or interest to be acquired. Again, the condemnor will be bound by the allegation in the complaint, and the landowner is not required to make the determination. Department of Public Works & Buildings v. Finks, 10 Ill.2d 20, 139 N.E.2d 242 (1956). 11. [2.61] Jury Demand To avoid having to make a separate demand (and to prevent forgetting to make the demand entirely), a demand for trial by jury may be included in the complaint for condemnation. 12. [2.62] Prayer for Relief As the sole issue to be determined in an eminent domain trial is the compensation to be paid for the land or interests taken, the complaint must include a prayer to the court “to cause the compensation to be paid to the owner to be assessed.” 735 ILCS 30/10-5-10(a). This requirement is statutory. In addition, the prayer may ask the court to retain jurisdiction following payment of the judgment to award possession to the condemnor or to apportion the award among interested parties. C. [2.63] Summons The standard summons form should not be used. While 735 ILCS 30/10-5-25 provides that “[s]ervice of summons and publication of notice shall be made as in other civil cases,” because of the nature of eminent domain, the form of summons provided by Supreme Court Rule 101(d) should be modified. The following is a suggested form of modification: You are summoned and required to file an answer to the complaint in this case, a copy of which is hereto attached, or otherwise file your appearance, in the office of the clerk of this court within 30 days after service of this summons, not counting the day of service. If you fail to do so, a judgment by default may be entered against you for the relief asked in the complaint.

PRACTICE POINTER

Modification of the usual civil case summons is necessary because answers are considered an improper pleading in eminent domain. Even though an answer may contain jurisdictional challenges or raise other issues such as damages to the remainder, it is



properly stricken on motion of the condemnor. Department of Public Works & Buildings v. Lewis, 344 Ill. 253, 176 N.E. 345 (1931). The proper form of summons will contain no reference to an answer and will merely require the landowner or interested party to appear.

D. [2.64] Service by Publication Unknown owners and parties who cannot be served by summons may be made parties by publication as in other cases (with the same exceptions as to form as for the summons itself). Sample forms of an affidavit for publication and an affidavit as to unknown owners are set forth in §§2.78 and 2.79 below, respectively. E. [2.65] Service of Summons; Special Process Servers Not only is it essential to name all interested parties in the complaint; it is also essential to ensure that each is properly served. Named but unserved parties will not be bound by any judgment establishing compensation, and neither can their possession of the property be terminated.

PRACTICE POINTER

The attorney must check the sheriff’s return of service to ensure that the named parties have been served and have been properly served in accordance with statute. Unsuccessful service should be cured by obtaining and serving an alias summons. In stubborn cases, a private investigator may be appointed as a special process server to ensure that service is made.

F. [2.66] Excusing Service of Complaint for Condemnation S.Ct. Rule 104(c) provides that, for good cause shown, a court may excuse the service of the pleadings with the summons. In cases in which a great number of parcels are combined in a single complaint, the burden of serving copies of the complaint may be avoided by ex parte application to the court pursuant to Rule 104(c). G. [2.67] Motions for Appointment of Guardians ad Litem Practice regarding guardians ad litem is similar to other civil cases and is provided for in 735 ILCS 30/10-5-10(b), when there may be a person “not in being” or under disability who may have an interest in the property to be acquired. When the title search raises the possibility of the need for a guardian, the motion should be prepared for filing with the petition.



H. [2.68] Lis Pendens Notice Under 735 ILCS 5/2-1901, a condemnation suit

shall, from the time of the filing in the office of the recorder in the county where the real estate is located, of a notice signed by any party to the action or his attorney of record or attorney in fact, on his or her behalf, setting forth the title of the action, the parties to it, the court where it was brought and a description of the real estate, be constructive notice to every person subsequently acquiring an interest in or a lien on the property affected thereby, and every such person and every person acquiring an interest or lien as above stated, not in possession of the property and whose interest or lien is not shown of record at the time of filing such notice, shall, for the purposes of this Section, be deemed a subsequent purchaser and shall be bound by the proceedings to the same extent and in the same manner as if he or she were a party thereto. If in any such action plaintiff or petitioner neglects or fails for the period of 6 months after the filing of the complaint or petition to cause notice to be given the defendant or defendants, either by service of summons or publication as required by law, then such notice shall cease to be such constructive notice until service of summons or publication as required by law is had.

A sample form of a lis pendens notice is found in §2.77 below. The lis pendens warns subsequent purchasers about the pending action. Under the Clerks of Courts Act, 705 ILCS 105/0.01, et seq., filing fees are waived for circuit court filings by a local government or school district. 705 ILCS 105/27.2a(dd)(2). I. [2.69] Amendments to the Complaint for Condemnation In Department of Transportation of State of Illinois v. LaSalle National Bank, 102 Ill.App.3d 1093, 430 N.E.2d 286, 58 Ill.Dec. 344 (2d Dist. 1981), the Illinois Department of Transportation’s initial petition sought to acquire 21 acres of a 274-acre tract plus the access rights to the remaining 253 acres. Two years later, after the owner had constructed an $80 million hotel and office facility on the 253 acres, IDOT amended the petition to condemn, deleting the access rights from the property to be acquired. The owner’s counsel claimed that the deletion of the request for the access rights was “tantamount to the filing of a new petition” that entitled the owner to attorneys’ fees and defense costs as well as a two-year advancement of the valuation date. 430 N.E.2d at 290. The court ruled that the mere deletion of access rights, without any addition or substitution of property, does not equal the filing of a new petition and does not, therefore, require a new valuation date. See also City of Crystal Lake v. LaSalle Nat’l Bank, 121 Ill.App.3d 346, 459 N.E.2d 643, 648, 76 Ill.Dec. 728 (2d Dist. 1984), in which the condemnor amended its original petition by reducing the take from 236 acres to 27 acres with easements over the remaining 209 acres. J. [2.70] Abandonment — Condemnor’s Dismissal of the Complaint The condemnor may abandon the proceedings at any time, even after entry of the judgment, until possession is taken or the award is paid. In these cases, the landowner is entitled to



reasonable attorneys’ fees and costs. 735 ILCS 30/10-5-70(a). The abandonment or dismissal of the case prior to the entry of a final judgment does not bar a subsequent attempt to acquire the same property provided that the abandonment or dismissal was in good faith. It would appear from the cases on this point that the courts will examine the question of good faith. Abandonment is a decision that must be carefully weighed due to its severe consequences.

PRACTICE POINTERS

When quick-take is exercised, the improvement may have been demolished for a public works project or conveyed to a developer who changed it from its original condition. Courts may deem that a jury’s view of the premises may be prejudicial if the condition at the date of its view does not correspond to its condition on the valuation date. See, e.g., Illinois State Toll Highway Authority v. Grand Mandarin Restaurant, Inc., 189 Ill.App.3d 355, 544 N.E.2d 1145, 136 Ill.Dec. 370 (2d Dist. 1989).

In order to demonstrate the condition of the premises at the valuation date, the

condemnor’s attorney should arrange to have the property photographed or videotaped at the time the complaint is filed or as soon thereafter as possible. The photos or video may demonstrate to the jury the appearance of the property, even if the improvement has long since been demolished. Obtaining this evidence will require the cooperation of the property owner and tenants. In difficult cases, however, application may be made to the court to permit the preservation of this evidence.

Abandonment is permitted even after deposit of the award of the amount of just compensation. Unlike ordinary judgments, a judgment or a verdict in condemnation need not be paid. See §2.21 above. Abandonment may occur even after the award is paid if the condemnor has not yet taken possession of the property. In City of Chicago v. Harris Trust & Savings Bank, 346 Ill.App.3d 609, 804 N.E.2d 724, 281 Ill.Dec. 759 (1st Dist. 2004), the City of Chicago acquired the fee interest in a downtown property, and a separate judgment for just compensation was determined for the leasehold interest for a billboard. After depositing the just compensation award for the billboard, the city realized that the billboard lease would have expired by its own terms. The city had not taken possession of the billboard but permitted it to remain for an interim period. Since the city had not yet taken possession of the billboard, it was permitted to abandon taking, despite having deposited the amount of just compensation. The court noted the express terms of the abandonment statute (now 735 ILCS 30/20-5-40): “[A]fter the plaintiff has taken possession of the property pursuant to the order of taking, the plaintiff shall have no right to dismiss the complaint or to abandon the proceeding.” [Emphasis added.] 804 N.E.2d at 730, quoting 735 ILCS 5/7-110 (2002). Since the statute speaks of possession as terminating the right to abandon, the court held that it made no difference that the city had deposited the award, as long as it had not yet taken possession of the property.



K. [2.71] Immediate Right of Entry by Necessity In an extraordinary decision, the Fourth District Appellate Court held that a condemnor could be granted an immediate right of entry by showing compelling need, even before just compensation is determined and paid to the owner. Enbridge Pipelines (Illinois), L.L.C. v. Troyer, 2015 IL App (4th) 150334, 38 N.E.3d 1282, 395 Ill.Dec. 526. In that case, the pipeline company-condemnor had been authorized by the Illinois Commerce Commission to exercise eminent domain power to acquire easements to install a subterranean pipeline. The company was unable to agree with the landowners as to just compensation and filed a condemnation complaint. The landowners refused to give the company permission to enter their premises to begin installation of the pipeline. The company then requested the court to enjoin the landowners from interfering with the company’s entering the land to install the pipeline. The company claimed that to await a determination of just compensation would delay the pipeline and increase construction cost. It offered to deposit with the court an amount equal to the landowners’ compensation demand. Pipeline companies do not have quick-take powers. Nevertheless, the appellate court affirmed the trial court’s grant of immediate entry, evaluating the pipeline company’s claim by the standards for issuing a temporary restraining order. The appellate court found the allegations of irreparable harm sufficient to justify the injunction. In addition, it noted that money deposited with the court, together with a bond, assured that just compensation would be paid. There is no indication that the compensation award would be available to the landowners until the conclusion of the condemnation case, long after the pipeline company entered their property. Query whether this is inconsistent with Kirby Forest Industries, Inc. v. United States, 467 U.S. 1, 81 L.Ed.2d 1, 104 S.Ct. 2187, 2195 (1984) (“owner is protected by the rule that title does not pass until compensation has been ascertained and paid”), and Forest Preserve District of DuPage County v. First National Bank of Franklin Park, 2011 IL 110759, 961 N.E.2d 775, 356 Ill.Dec. 386, which requires that just compensation be determined and paid before the condemnor takes possession of an owner’s land. IV. APPENDIX A. [2.72] Additional Authorities For further information on the topic of this chapter, see Frank S. Righeimer, Jr., EMINENT DOMAIN IN ILLINOIS (3d ed. 1986) (an excellent reference but now somewhat dated, particularly because it predates the Eminent Domain Act); Julius L. Sackman et al., NICHOLS’ THE LAW OF EMINENT DOMAIN (rev. 3d ed.) (multivolume set, year varies by volume); and Thomas F. Geselbracht et al., ILLINOIS ZONING, EMINENT DOMAIN, AND LAND USE MANUAL (1997).



B. Sample Forms 1. [2.73] First-Contact Letter

[letterhead of state agency] [date]

[name and address of recipient] Dear [name of recipient]: Public records indicate that you own or have an interest in the following property:

[legal description] [common address] [PIN] Please be advised that the Illinois Department of [name of department] seeks to acquire the above-described property in [fee simple or other interest]. The purpose of the proposed acquisition is to furnish a site for [project description]. The type of facility to be constructed on the property is [type of facility]. If you have any questions concerning this acquisition, please contact [contact name] at [contact information]. Please be advised that the person designated above shall respond to the property owner’s questions about the authority and procedures of the [name of entity] in acquiring property by condemnation and about the property owner’s general rights under those procedures. However, the designated person is unable to provide property owners with specific legal advice or specific legal referrals. Very truly yours, _____________________________________



2. [2.74] Sixty-Day Notice Letter

[letterhead of state agency] [date]

Certified Mail No. ________

Return Receipt Requested [name and address of recipient] Dear [name of recipient]: The public records indicate that you are the owner of or have an interest in the following described property:

Parcel [parcel number] [legal description]

[common address, if applicable] [interest to be acquired]

The Illinois Department of [name of department] has ordered and directed that the above-described property be acquired for [reason for acquisition] purposes. The Illinois Department of [name of department] hereby offers the sum of $__________ for the interest in the above-described property free and clear of all claims of other parties, liens, taxes, and encumbrances. The compensation hereby offered has been established pursuant to appraisals conducted by independent appraisers. The appraisers considered the size, shape, location, topography, and zoning of the subject property. The appraisers also considered one or more of the following measures of value: recent sales of comparable properties; reproduction or replacement cost, less depreciation; and the income generated by the subject property. If you wish to discuss this offer, please make an appointment with the undersigned for that purpose at the above address. We will continue to seek a negotiated agreement for a period of 60 days. Unless we hear from you or your attorney, we shall assume that you have rejected this offer. If we are unable to reach an agreement after 60 days, we will file a court proceeding to acquire the property pursuant to the Illinois Eminent Domain Act. Very truly yours, ______________________________________ By: __________________________________ Attorney for Condemnor



3. [2.75] Letter To Request Inspection

[letterhead of municipality]

[name and address of recipient] Re: Property Location: PIN Numbers: Legal Description: Dear [name of recipient]: Public records indicate that you are the owner of the property referred to above. The subject property is located at [location]. In furtherance of the village’s redevelopment plan for this area, the village has recently sought proposals from developers. The plans of the village call for the eventual acquisition of property within the development area. In order to begin the development process, the village will be appointing appraisers to provide expert valuations of the subject property. For the appraisers to value your property accurately, it will be necessary for them to conduct an interior inspection and obtain helpful information from the owner. We would appreciate the opportunity to obtain a mutually convenient date so that you can accompany our appraiser on such an inspection. Naturally, you, your appraiser, and your attorney may be present during such an inspection. Our attorneys, [name of attorneys], will be representing the village in the development process. Kindly get in touch with the attorneys listed below in order to arrange an appraisal inspection. Please contact: [attorney information] Very truly yours, ______________________________________ Village Manager



4. [2.76] Complaint for Condemnation

IN THE CIRCUIT COURT OF [name of county] COUNTY, ILLINOIS

[COUNTY DEPARTMENT, LAW DIVISION] DEPARTMENT OF TRANSPORTATION, ) STATE of Illinois, ) ) Plaintiff, ) ) No. ________ v. ) ) Parcel No. ________ [name of defendants]; ) and UNKNOWN OWNERS, ) ) Defendants. )

COMPLAINT FOR CONDEMNATION THE DEPARTMENT OF [name of department] OF THE STATE OF ILLINOIS, Plaintiff herein, by [name of Attorney General], Attorney General of the State of Illinois, and [name of Special Assistant Attorney General], Special Assistant Attorney General, respectfully states: 1. Plaintiff, Department of [name of department], State of Illinois, is a Department of the State government of the State of Illinois, as created and provided for in an Act known as the Civil Administrative Code of Illinois. 2. Under and by virtue of Article 2 and Article 4, Division 5, of the Illinois Highway Code, 605 ILCS 5/2-101 through 5/2-220 and 605 ILCS 5/4-501 through 5/4-512, and all other applicable provisions of the Illinois Highway Code, and §5-5-5(b) and other provisions of the Eminent Domain Act, plaintiff is engaged in the relocating, reconstructing, extending, widening, straightening, improving, repairing, and maintaining of the roadway known as [name of roadway] in [name of county] County, a highway under the control and jurisdiction of plaintiff; and for such purposes, and the providing of natural deposits and road materials therefor, that highway has been surveyed, laid out, and projected over certain lands and premises situated in [name of county] County, Illinois; and those lands and premises, which are the subject of this complaint, are in Section [number of section], which is concerned with widening and improving the existing roadway in [name of county] County, Illinois. 3. The land, rights, or other property hereinafter described is private property, and the persons hereinafter mentioned in connection therewith are, as far as appears of record, and as far as plaintiff has been able to learn, the persons who own or otherwise are interested in them or claim to have some interest therein.



4. The work and improvement described above is a public work, is for public use, and constitutes a public purpose, namely, a public highway; and it is necessary that plaintiff have and acquire for the use of the people of the State of Illinois for highway purposes the land, rights, or other property hereinafter described. 5. Plaintiff, under the provisions of §4-501 of the Illinois Highway Code (referred to above), is authorized to acquire for the purposes aforesaid the fee-simple title, or such lesser interest as may be desired, to the lands, rights, or other property hereinafter described. 6. The compensation to be paid by plaintiff for or in respect to each tract of property sought to be appropriated or damaged for the above-mentioned purposes cannot be agreed on between plaintiff and the parties interested therein although plaintiff has attempted to effect such an agreement; and plaintiff, therefore, is authorized to proceed to acquire said lands, rights, or other property through the exercise of the right of eminent domain under the eminent domain laws of this State. 7. Plaintiff now seeks to acquire under the Eminent Domain Act, for the uses and purposes described above, the fee-simple title to the real property in [name of county] County, Illinois, hereinafter described in numbered parcel [parcel number]. The names of all persons interested in each numbered parcel as owners or otherwise, as appearing of record, or as far as is known to plaintiff, all of whom are hereby made parties defendant to this complaint, are as follows:

Parcel [parcel number]

[That part of the Southeast quarter of Section 12, Township 42 North, Range 10 East of the Third Principal Meridian, in (name of county) County, Illinois, described as follows]:

[legal description]

Interest Sought: Fee Simple Owner of Record:

[Name of financial institution], as Trustee under Trust Agreement dated [date], known as Trust Number [trust number].

Parties Otherwise Interested:

[Name of mortgagee], as mortgagee under mortgage dated [date of mortgage], and recorded [date of recording], as doc. No. [doc. number]. Unknown Owners

8. In addition to persons designated by name herein, there are other persons who are interested in this action and who have or claim some right, title, interest, or lien in, to, or on



the real estate, or some parts thereof, described in this petition, and the name of each of those other persons is unknown, and all such persons are, therefore, made parties defendant to this action by the name and description of Unknown Owners. 9. In addition to persons designated by name herein, there are or may be other persons occupying or in possession of a portion of the building or structures on the real property described, and the name of each of those other persons is unknown, and all such persons are, therefore, made parties defendant to this action by the name and description of Unknown Owners. WHEREFORE, your plaintiff prays that the usual process of summons be issued against each and all of the above-described defendants according to law, commanding them to be and appear before this court on the return day of the summons, and that due notice according to the law may be given to the owners of and parties interested in and to the Unknown Owners of the real property described above. Your plaintiff further prays the Court to cause compensation to be ascertained and determined according to the statute for the fee-simple title to the property sought to be acquired and to take such proceedings and enter such orders as necessary, ordering that plaintiff enter on the property and use it upon payment of full compensation to the parties entitled thereto, or to the County Treasurer, within such reasonable time as is fixed by the Court and that the Court retain jurisdiction of this cause to enter such further orders as may be necessary, including such orders as may be necessary to put plaintiff into possession of the subject property. PLAINTIFF DEMANDS TRIAL BY JURY. DEPARTMENT OF TRANSPORTATION, STATE OF ILLINOIS ______________________________________ Governor of the State of Illinois ______________________________________ Secretary of the Department of Transportation ______________________________________ Attorney General of the State of Illinois _______________________________________ Special Assistant Attorney General [attorney information]



5. [2.77] Lis Pendens Notice

[Caption]

LIS PENDENS NOTICE I, the undersigned, do hereby certify that the above-entitled cause was filed in the above Court on the [day] of [date], for [Condemnation] and is now pending in said Court and that the property affected by that cause is described as follows:

[legal description] [party names]

[interest to be acquired] (Check one) Signature: __________________________________________ Party to said Cause __________________________________________ Attorney of Record [Type or print name for clarification.] __________________________________________ [address] Mail to: Name: ___________________________________ Address: _________________________________ OR Deposit in Box No. ______________________________________ Recorder’s Office 6. [2.78] Affidavit for Publication

[Caption]

AFFIDAVIT FOR PUBLICATION [Name of attorney], attorney for the plaintiff in the above-entitled cause, being first duly sworn, states that the defendants in this cause herein named reside or have gone out of state, on due inquiry cannot be found, or are concealed within this state so that process cannot be served on them; that upon diligent inquiry their places of residence cannot be ascertained; and that their last known places of residence are as herein shown:



Parcel [parcel number] Name: Last Known Place of Residence: Owners and holders of indebtedness Unknown secured by trust deed. Unknown Others Unknown FURTHER affiant saith not. ______________________________________ SUBSCRIBED AND SWORN to before me this [date]. ____________________________________ [expiration date] Notary Public Expiration Date 7. [2.79] Affidavit as to Unknown Owners

[Caption]

AFFIDAVIT AS TO UNKNOWN OWNERS [Name of attorney], attorney for the plaintiff in the above-entitled action and the duly authorized agent of the plaintiff in its behalf, being first duly sworn, on oath deposes and states that there are persons who are interested in this action whose names are unknown, and all such persons are made parties defendant to this action by the name and description of “Unknown Owners.” Affiant further states that upon due and diligent inquiry it cannot be ascertained whether the persons whose names are set forth in the complaint filed herein as persons interested as owners or otherwise are living or dead and that the names of such persons who would be their heirs or devisees are unknown, and all such persons are made parties defendant to this action by the name and description of “Unknown Owners.” Affiant further states that there are persons who are or may be interested in this action as the heirs or devisees of certain deceased persons and that the names of such persons are unknown. Therefore, all such persons are made parties defendant to this action by the name and description of “Unknown Owners.”



FURTHER affiant saith not. ______________________________________ SUBSCRIBED AND SWORN to before me this [date]. ____________________________________ [expiration date] Notary Public Expiration Date 8. [2.80] Letter of Final Good-Faith Offer

[date]

Certified Mail No. ________ Return Receipt Requested

[name and address of recipient] Dear [name of recipient]: The public records indicate that you are the owner of or have an interest in the following described property:

Parcel [parcel number]

[legal description] [common address, if applicable]

[Condemnor] has ordered and directed that this property be acquired for [reason for acquisition] purposes. [Condemnor] hereby offers you the sum of $__________ for the above-described property, free and clear of all claims of other parties, liens, taxes, and encumbrances. If you wish to discuss this offer, please make an appointment with the undersigned for that purpose at the above address. Unless we hear from you or your attorney within ten days from the date of this letter, we shall assume you have rejected the offer, and condemnation proceedings to acquire the property will be instituted by [condemnor]. Very truly yours, ______________________________________ By: __________________________________ Attorney for Condemnor


Pleadings and Procedures by the Condemnee B. JAY DOWLING Clayborne, Sabo & Wagner LLP Belleville

IICLE® gratefully acknowledges the contributions of Harry J. Sterling to previous editions of this chapter.

3



I. [3.1] Scope of Chapter II. [3.2] Initial Considerations III. [3.3] Early Discovery

IV. Traverse and Motion To Dismiss A. [3.4] Purpose B. [3.5] Time of Filing C. [3.6] Grounds 1. [3.7] Necessity 2. [3.8] Public Purpose 3. [3.9] Bona Fide Attempt To Agree 4. [3.10] Condemnor’s Authority 5. [3.11] Property Subject to Condemnation 6. [3.12] Proper Description D. [3.13] When Traverse Does Not Lie E. [3.14] Trial of a Traverse F. [3.15] If the Traverse Is Denied G. [3.16] If the Traverse Is Granted V. [3.17] Counterclaim

VI. [3.18] Right To Open and Close VII. [3.19] View of Premises VIII. [3.20] Later Motions IX. [3.21] Significant Decisions X. [3.22] Final Concerns XI. Appendix — Forms A. [3.23] Motion for Production of Witnesses, Documents, Etc. B. [3.24] Traverse and Motion To Dismiss C. [3.25] Counterclaim D. [3.26] Motion To Open and Close E. [3.27] Motion for View of Premises

PLEADINGS AND PROCEDURES BY THE CONDEMNEE §3.2


I. [3.1] SCOPE OF CHAPTER Much has been written with respect to the appropriate steps for the condemnor in eminent domain actions, with a lesser emphasis on steps the condemnee can or should take. This chapter provides a thumbnail sketch of the courses of action that are available to a condemnee. It should be emphasized to the individual who has never handled a condemnation case that such a case is different from others. The procedures and rules of evidence are different. A wise attorney once explained to an eager novice that the only way to adequately prepare any case was to do so from a 360-degree perspective. This includes asking, “What will the other side do? What would you do if you were on the other side?” II. [3.2] INITIAL CONSIDERATIONS Eminent domain proceedings are governed by the provisions of the Eminent Domain Act (EDA), 735 ILCS 30/1-1-1, et seq. At the outset of the initial consultation with the client, the lawyer should determine what the client wants by asking the following questions: • Does the client want to oppose the project? Is there a valid basis to oppose the project? Is

the basis to oppose the project procedural or substantive? Is the project for a “public purpose” and for a “public use”? Will the opposition to the project change the ultimate outcome or merely delay the inevitable condemnation? Is the opposition to the project a waste of the client’s money? Is the only issue “just compensation” (money)?

• Is there a question about the size of the property to be taken? • Where is the property located? • What is the “highest and best use” of the property? Are there questions of access? • Are there questions of drainage, noise, etc.? • Are there questions about the remaining property and damages to the remainder? • Are there other factors to which consideration should be given? Once these initial questions are answered, the attorney can determine the correct steps to follow. If the client has already been served with process, a careful review of the complaint is the next step. The complaint should be compared with 735 ILCS 30/10-5-10 to verify that it contains all of the necessary elements. Further, the attorney should consider whether the complaint satisfies the standards set forth in 735 ILCS 30/20-5-10. If not, a traverse and motion to dismiss should be filed. See §§3.4 – 3.16 below. The legal description also should be checked to verify exactly what property and what rights (i.e., fee simple, a permanent or temporary easement, access, etc.) are to be taken. Village of Round Lake v. Amann, 311 Ill.App.3d 705, 725 N.E.2d 35,



244 Ill.Dec. 240 (2d Dist. 2000); Forest Preserve District of DuPage County v. Miller, 339 Ill.App.3d 244, 789 N.E.2d 916, 273 Ill.Dec. 742 (2d Dist. 2003); Illinois State Toll Highway Authority v. Chicago Title & Trust Co., 37 Ill.App.3d 355, 345 N.E.2d 516 (2d Dist. 1976); Lake County Forest Preserve v. Frecska, 85 Ill.App.3d 610, 407 N.E.2d 137, 40 Ill.Dec. 906 (2d Dist. 1980); Department of Transportation v. HP/Meachum Land Limited Partnership, 245 Ill.App.3d 252, 614 N.E.2d 485, 185 Ill.Dec. 351 (2d Dist. 1993); Lieberman v. Chicago & S.S.R.T.R. Co., 141 Ill. 140, 30 N.E. 544 (1892); Forest Preserve District of Cook County v. City of Chicago, 159 Ill.App.3d 859, 513 N.E.2d 22, 111 Ill.Dec. 776 (1st Dist. 1987). The condemnor and its attorney have the burden of proving fair market value (i.e., the amount of money a willing buyer would pay to a willing seller/owner when neither party is obligated to buy or sell). Forest Preserve District of DuPage County v. First National Bank of Franklin Park, 2011 IL 110759, 961 N.E.2d 775, 356 Ill.Dec. 386; Public Building Commission of Chicago v. Yellen, 2013 IL App (1st) 112638, 986 N.E.2d 706, 369 Ill.Dec. 393; County of St. Clair v. Wilson, 284 Ill.App.3d 79, 672 N.E.2d 27, 28 – 29, 219 Ill.Dec. 712 (5th Dist. 1996); Department of Transportation v. Drury Displays, Inc., 327 Ill.App.3d 881, 764 N.E.2d 166, 261 Ill.Dec. 875 (5th Dist. 2002). However, it is the job of the condemnee’s attorney to make certain that the property owner is made whole. Department of Transportation v. Chicago Title & Trust Co., 303 Ill.App.3d 484, 707 N.E.2d 637, 236 Ill.Dec. 510 (1st Dist. 1999). A property owner should be, as much as monetarily possible, restored to the position he or she would have been in had the property not been taken. Franklin Park, supra; Yellen, supra; Illinois Cities Water Co v. City of Mt. Vernon, 11 Ill.2d 547, 144 N.E.2d 729 (1957); Meachum, supra; United States v. Reynolds, 397 U.S. 14, 25 L.Ed.2d 12, 90 S.Ct. 803, 805 (1970). This includes compensating the owner not only for the highest and best use of the land but also for any future use that may be anticipated with reasonable certainty. City of Quincy, Illinois v. Diamond Construction Co., 327 Ill.App.3d 338, 762 N.E.2d 710, 261 Ill.Dec. 141 (4th Dist. 2002). The right of eminent domain by a department of government can be exercised only when a grant of the right is specifically conferred by legislative enactment and then only in the manner and by the agency so empowered. City of Chicago v. St. John’s United Church of Christ, 404 Ill.App.3d 505, 935 N.E.2d 1158, 343 Ill.Dec. 930 (2d Dist. 2010); Forest Preserve District of DuPage County v. Brown Family Trust, 323 Ill.App.3d 686, 753 N.E.2d 1110, 257 Ill.Dec. 484 (2d Dist. 2001); Department of Transportation of State of Illinois v. Callender Construction Co., 305 Ill.App.3d 396, 711 N.E.2d 1199, 238 Ill.Dec. 538 (4th Dist. 1999); Amann, supra; City of Batavia v. Sandberg, 286 Ill.App.3d 991, 677 N.E.2d 1010, 222 Ill.Dec. 476 (2d Dist. 1997); Board of Trustees of University of Illinois v. Shapiro, 343 Ill.App.3d 943, 799 N.E.2d 383, 278 Ill.Dec. 665 (1st Dist. 2003); Illinois Department of Natural Resources v. Pedigo, 348 Ill.App.3d 1044, 811 N.E.2d 761, 285 Ill.Dec. 274 (4th Dist. 2004). However, if the property is not necessary for the project, condemnation of the property is improper, regardless of what is asserted in the enabling legislation. Village of Bensenville v. City of Chicago, 389 Ill.App.3d 446, 906 N.E.2d 556, 329 Ill.Dec. 358 (2d Dist. 2009). III. [3.3] EARLY DISCOVERY While the general concept of discovery is discussed in Chapter 6 of this handbook, a short reference to this area must be made in connection with the initial steps to be taken by the



condemnee’s attorney. In most cases, even if the landowner wants to file a traverse and motion to dismiss, the condemnee’s attorney may not have sufficient facts to prepare for the hearing or trial of these actions. Given the immediacy with which the condemnor may file quick-take proceedings, if available (discussed in Chapter 4 of this handbook), the attorney for the condemnee must immediately prepare and file requests for production and interrogatories directed to the engineering as well as the appraisal aspects of the proposed acquisition. A very specific request for production should be prepared, requesting copies of appraisals, appraisal reviews, plans, engineering drawings, drainage drawings, plats, aerials, comparable sales information, parking diagrams, etc., so that the condemnee’s attorney is in an equal position to the condemnor’s attorney with respect to initial documentation. The condemnee’s attorney should know that the governmental agency will have staff appraisers, independent fee appraisers, and reviewing appraisers. All of their appraisals are discoverable under Illinois Supreme Court Rules 214 or 201 (unless, of course, when dealing with a “consultant” (S.Ct. Rule 201(b)(3))). Other discovery rules may also be useful. The condemnee’s attorney should also take the deposition of “the person in charge” for other discovery leads. Once the appraisal and engineering drawings are obtained, a careful review must be made of this documentation to determine whether any cross-references are made to documents not produced. For example, Illinois Department of Transportation contract appraisers generally prepare a “sales data book” of all of the sales they may use in any series of parcels assigned to them. The condemnee’s attorney should obtain that book so that if the appraiser uses only a few of the comparables that have been submitted, questions may be posed as to why other comparables that were submitted were not considered. Another example of cross-references made in standard state appraisals is to a document titled “land economic studies.”

Land economic studies are prepared for the purpose of showing the actual damage or benefit, occurring to the remainder of a property as the result of the acquisition of land for a public improvement. They are used primarily by staff and fee appraisers to assist in determining adjustments to the comparable sales used to value the remaining property in a partial taking in connection with appraisals for transportation projects. Illinois Department of Transportation, LAND ACQUISITION POLICIES AND PROCEDURES MANUAL, §3.13.1 (Nov. 2015) (continually updated resource).

These records are retained by the Illinois Department of Transportation. They are used to justify the appraisers’ numbers on diminution in value based on the later sale. When the condemnor is using federal funding, the condemnee may want to request and review the documentation that the condemning authority must submit to the federal government. For this purpose, counsel should refer to S.Ct. Rules 201 and 214 and note the holding in Department of Transportation v. Beeson, 137 Ill.App.3d 908, 485 N.E.2d 511, 92 Ill.Dec. 700 (2d Dist. 1985), adopting the application of Federal Rules of Evidence 703 and 705 to eminent domain cases. See also City of Chicago v. Anthony, 136 Ill.2d 169, 554 N.E.2d 1381, 144 Ill.Dec. 93 (1990).



Another important resource to consider is the taking of early depositions under S.Ct. Rule 202, et seq. It may be helpful to have completed depositions, particularly when pressed to an early hearing by way of the quick-take procedure. In addition, should counsel elect to proceed with a traverse and motion to dismiss (discussed in §§3.4 – 3.16 below), an actual trial will be held on the issues in the complaint (except valuation); therefore, any well-prepared attorney would have the deposition phase of the trial preparation completed in advance of that trial. Of particular note is the fact that condemning authorities may change their plans as the project progresses. See Department of Public Works & Buildings of State of Illinois v. Vogt, 51 Ill.App.3d 770, 366 N.E.2d 310, 9 Ill.Dec. 53 (5th Dist. 1977), in which a petition for leave to appeal was first granted and then dismissed after oral argument. In Department of Transportation v. Schien, 72 Ill.2d 287, 381 N.E.2d 241, 21 Ill.Dec. 163 (1978), the appellate court and the Illinois Supreme Court affirmed the trial court’s dismissal of the condemnation complaint, even after a quick-take hearing had been held and an order vesting title had been entered when the state made several modifications to its construction plans requiring reappraisal. For an interesting follow-up to Vogt, supra, see Vogt v. Bartelsmeyer, 264 Ill.App.3d 165, 636 N.E.2d 1185, 201 Ill.Dec. 753 (5th Dist. 1994). When the condemnor seeks to acquire additional acreage, counsel may be able to argue to change the valuation date. See Department of Transportation v. HP/Meachum Land Limited Partnership, 245 Ill.App.3d 252, 614 N.E.2d 485, 185 Ill.Dec. 351 (2d Dist. 1993); Forest Preserve District of DuPage County v. First National Bank of Franklin Park, 401 Ill.App.3d 966, 930 N.E.2d 477, 341 Ill.Dec. 267 (2d Dist. 2010). See also 735 ILCS 30/10-5-60. Sometimes a sale used as a comparable sale sells again. Any adjustments made by the appraiser might or might not prove to be correct. Be prepared. IV. TRAVERSE AND MOTION TO DISMISS A. [3.4] Purpose If in the initial conference with the landowner a decision is made to challenge the eminent domain action, the pleading designed to do this is a traverse and motion to dismiss. If the allegations required in the complaint by 735 ILCS 30/10-5-10 are not contained therein or are untrue, these points must be raised in this pleading — which is really a trial within a trial. See Southwestern Illinois Development Authority v. Vollman, 235 Ill.App.3d 32, 600 N.E.2d 926, 175 Ill.Dec. 683 (5th Dist. 1992); Department of Transportation v. 151 Interstate Road Corp., 209 Ill.2d 471, 810 N.E.2d 1, 284 Ill.Dec. 348 (2004). See §3.24 below for a sample form of traverse and motion to dismiss In Garry v. Geils, 82 F.3d 1362 (7th Cir. 1996), the court held that the federal court lacked jurisdiction, in an action initiated under 42 U.S.C. §1983, on a theory that the property was chosen as an act of political retaliation. The court held that inferior federal courts do not have the power to exercise appellate review over state court decisions.



When a property owner contests a condemnor’s right to condemn through a traverse the burden is on the condemnor to maintain its right to condemn by sufficient proof. Forest Preserve District of DuPage County v. Miller, 339 Ill.App.3d 244, 789 N.E.2d 916, 273 Ill.Dec. 742 (2d Dist. 2003); Trustees of Schools of Township No. 37 v. First National Bank of Blue Island, 49 Ill.2d 408, 274 N.E.2d 56 (1971); Board of Trustees of Southern Illinois University v. Lange, 28 Ill.2d 229, 190 N.E.2d 789 (1963); City of Evanston v. Piotrowicz, 20 Ill.2d 512, 170 N.E.2d 569 (1960); City of Benton v. Odom, 123 Ill.App.3d 991, 463 N.E.2d 785, 79 Ill.Dec. 231 (5th Dist. 1984); County of DeKalb v. Smith, 213 Ill.App.3d 775, 572 N.E.2d 379, 157 Ill.Dec. 310 (2d Dist. 1991); City of Batavia v. Sandberg, 286 Ill.App.3d 991, 677 N.E.2d 1010, 222 Ill.Dec. 476 (2d Dist. 1997). However, once the condemnor makes a prima facie case, the burden shifts to the property owner to produce evidence to support the allegations set forth in the traverse. Trustees of School Township No. 37, supra. See also City of Chicago v. Boulevard Bank National Ass’n, 293 Ill.App.3d 767, 688 N.E.2d 844, 228 Ill.Dec. 146 (1st Dist. 1997), when a party challenges a municipality’s ordinance, the party is required to overcome the ordinance’s presumptive validity by clear and convincing evidence, which is the quantum of proof that leaves no reasonable doubt in the mind of the fact-finder as to the truth of the proposition stated. A condemnor must establish a prima facie case and offer some proof on the disputed averments. Department of Public Works & Buildings v. Keller, 61 Ill.2d 320, 335 N.E.2d 443 (1975); Lake County Forest Preserve District v. First National Bank of Waukegan, 154 Ill.App.3d 45, 506 N.E.2d 424, 106 Ill.Dec. 717 (2d Dist. 1987); MCI WorldCom Communications, Inc. v. Metra Commuter Rail Division of Regional Transportation Authority, 337 Ill.App.3d 576, 786 N.E.2d 621, 272 Ill.Dec. 82 (2d Dist. 2003). Since the issues raised are questions of law, the determination is made by the court without a jury. The Eminent Domain Act states the following with respect to the quick-take hearing:

[I]f the court has not previously, in the same proceeding, determined that the plaintiff has authority to exercise the right of eminent domain, that the property sought to be taken is subject to the exercise of that right, and that the right of eminent domain is not being improperly exercised in the particular proceeding, then the court shall first hear and determine those matters. 735 ILCS 30/20-5-10(b).

The above statement refers to a determination by the court of those issues in the hearing on the traverse and motion to dismiss or to a trial when no motion for immediate vesting of title has been filed and heard. See Illinois State Highway Authority v. South Barrington Office Center, 2016 IL App (1st) 150960-U (discussion of purpose and procedure of traverse). If a property owner files a motion to dismiss and not a traverse or a combined motion to dismiss and traverse, the burden of proof remains on the property owner to prove all matters asserted in the motion. Town of Libertyville v. Connors, 185 Ill.App.3d 317, 541 N.E.2d 250, 133 Ill.Dec. 413 (2d Dist. 1989). B. [3.5] Time of Filing If a landowner wishes to contest the right of the condemnor to proceed with the project, it goes without saying that the appropriate pleadings should be filed immediately. A number of cases have questioned the timing in the filing of a traverse and motion to dismiss, so the safest



course of action is to file it immediately. City of Chicago in Trust for Use of Schools v. Albert J. Schorsch Realty Co., 95 Ill.App.2d 258, 238 N.E.2d 434 (1st Dist. 1968); Chicago Housing Authority v. Berkson, 415 Ill. 159, 112 N.E.2d 620 (1953); City of Chicago v. Chicago Title & Trust Co., 331 Ill. 322, 163 N.E. 17 (1928). A landowner can be deemed to have waived the right to contest the right to condemn by filing a cross-petition (now called a “counterclaim”). Chicago, N.S. & M.R. Co. v. Chicago Title & Trust Co., 328 Ill. 610, 160 N.E. 226 (1928); Alton & S.R.R. v. Vandalia R. Co., 271 Ill. 558, 111 N.E. 531 (1916); Towne v. Town of Libertyville, 190 Ill.App.3d 563, 546 N.E.2d 810, 137 Ill.Dec. 865 (2d Dist. 1989); Forest Preserve District of Kane County v. Estes, 222 Ill.App.3d 167, 583 N.E.2d 640, 164 Ill.Dec. 724 (2d Dist. 1991). For a novel (albeit unsuccessful) attempt to challenge a proposed taking as unconstitutional in a separate action (later consolidated in an eminent domain case), see Kassnel v. Village of Rosemont, 135 Ill.App.3d 361, 481 N.E.2d 849, 90 Ill.Dec. 49 (1st Dist. 1985). C. [3.6] Grounds Any of the allegations contained in the complaint to condemn can provide fertile ground to challenge the complaint. Since no formal answer is required in a condemnation action (Department of Public Works & Buildings v. Lewis, 344 Ill. 253, 176 N.E. 345 (1931)), the correct method to put in issue the allegations in the complaint desired to be challenged is to include them in the traverse and motion to dismiss. Some of the particular areas of challenge are discussed in §§3.7 – 3.12 below. 1. [3.7] Necessity In Department of Transportation of State of Illinois v. Keller, 127 Ill.App.3d 976, 469 N.E.2d 262, 82 Ill.Dec. 728 (5th Dist. 1984), the precise question of what “necessary” means was addressed. The court stated:

The court’s remarks imply that the term “necessary,” and consequently the issue of whether the acquisitions are “necessary,” are subject to two meanings, one of which forms the basis of an inquiry which is properly before the court, and one of which is not. This is another way of stating that the term “necessary,” for purposes of condemnation proceedings, is subject to a definition other than that to which the term is subject in common discourse. This distinction was recognized implicitly by the [S]upreme [C]ourt of Illinois in Department of Public Works & Buildings v. Lewis (1952), 411 Ill. 242, 245 – 46, 103 N.E.2d 595:

“The word ‘necessary’ in statutes such as the [Eminent Domain Act] ‘should be construed to mean “expedient,” “reasonably convenient,” or “useful to the public,” and cannot be limited to an absolute physical necessity.’ . . . Conversely, the word ‘necessary’ does not mean ‘indispensable’. . . or ‘an absolute necessity.’ The general rule is that, where the right of eminent domain is granted, the necessity for its exercise, within constitutional restrictions, is not a judicial question, and its exercise is not a proper subject



for judicial interference or control unless to prevent a clear abuse of such power. . . . This Court . . . in Smith v. Claussen Park and Levee Drainage District, 229 Ill. 155, 163, 82 N.E. 278, stated, ‘If the court finds that the use for which the property is to be taken is a public one, then the court will not inquire into the extent to which the property is necessary for such use unless it appears that the quantity of property taken is grossly in excess of the amount necessary for the use.’ ”

The question of whether a public taking is “necessary,” then, may be an inquiry directed to one of two fields of reference. It may, first, constitute an attempt to determine the veracity of that proposition of which the petitioner is obliged to make a prima facie showing in the first instance — i.e., that the purpose for which the land is sought is one of public convenience, and the acquisition, reasonable in scope, is an expedient means of accomplishing the purpose. It may, second, constitute an attempt to determine whether, given the legitimacy of the project, a given acquisition is “indispensable” — i.e., the only means of accomplishing a purpose, the public convenience and reasonable scope of which are not at issue. According to the rule set forth in Lewis, the first question would fall within the scope of judicial inquiry and the second question would not. The resolution of the issue presented in the instant case thus depends on a determination of precisely what questions the witnesses were not allowed to answer. [Citations omitted by Keller court.] 469 N.E.2d at 266.

See also City of Chicago v. First Bank of Oak Park, 178 Ill.App.3d 321, 533 N.E.2d 424, 127 Ill.Dec. 552 (1st Dist. 1988); City of Elgin v. Elgin National Bank, 174 Ill.App.3d 1061, 529 N.E.2d 639, 124 Ill.Dec. 658 (1st Dist. 1988); Department of Transportation v. First Galesburg National Bank & Trust Co., 141 Ill.2d 462, 566 N.E.2d 254, 152 Ill.Dec. 567 (1990); Forest Preserve District of DuPage County v. Brown Family Trust, 323 Ill.App.3d 686, 753 N.E.2d 1110, 257 Ill.Dec. 484 (2d Dist. 2001). The court in City of Chicago v. St. John’s United Church of Christ, 404 Ill.App.3d 505, 935 N.E.2d 1158, 343 Ill.Dec. 930 (2d Dist. 2010), is in accord with the holding in Keller, supra. In St. John’s United Church, the court noted that an ordinance containing the legislative finding of necessity is prima facie evidence of necessity and that the court’s inquiry into the existence of necessity in an eminent domain case is “limited but crucial.” 935 N.E.2d at 1170. The court further explained its rationale by noting: The general rule is that where the legislature has delegated to a corporation the

authority to exercise the power of eminent domain, the corporation has also the authority to decide on the necessity for exercising the right, and its decision will be conclusive in the absence of a clear abuse of the power granted. . . . An abuse of such power, however, will not be tolerated, and if no necessity for its exercise exists, or if it appears that the quantity of the property sought to be taken is grossly in excess of the amount necessary for the public use, the Court will not permit the land to be taken. [Citations omitted by St. John’s United Church court.] Id., quoting City of Chicago v. Vaccarro, 408 Ill. 587, 97 N.E.2d 766, 771 – 772 (1951).



However, the Illinois Supreme Court condemned the practice of a governmental agency seeking to acquire more than what it actually “needed” in People ex rel. Director of Finance v. Young Women’s Christian Association of Springfield, 86 Ill.2d 219, 427 N.E.2d 70, 55 Ill.Dec. 950 (1981). See also Village of Bensenville v. City of Chicago, 389 Ill.App.3d 446, 906 N.E.2d 556, 329 Ill.Dec. 358 (2d Dist. 2009). Generally speaking, once the legislature has granted the authority to condemn to a governmental body, it has included in that authority the right to decide the necessity for the use of the condemnation power. Only the abuse of the exercise of that power can be challenged. Department of Transportation v. 151 Interstate Road Corp., 209 Ill.2d 471, 810 N.E.2d 1, 284 Ill.Dec. 348 (2004); Department of Public Works & Buildings v. Keller, 61 Ill.2d 320, 335 N.E.2d 443 (1975); Lewis, supra; Department of Conservation of State of Illinois v. Harold’s Farm, Inc., 68 Ill.App.3d 148, 385 N.E.2d 1097, 24 Ill.Dec. 807 (3d Dist. 1978). For an excellent discussion of when the court found an abuse of power, see Village of Skokie v. Gianoulis, 260 Ill.App.3d 287, 632 N.E.2d 106, 198 Ill.Dec. 47 (1st Dist. 1994). See also City of Batavia v. Sandberg, 286 Ill.App.3d 991, 677 N.E.2d 1010, 222 Ill.Dec. 476 (2d Dist. 1997). In County of St. Clair v. Faust, 278 Ill.App.3d 152, 662 N.E.2d 584, 214 Ill.Dec. 1018 (5th Dist. 1996), the court held that the county’s taking of 200 acres was grossly excessive in view of the fact that the project took approximately 80 acres of wetland forest out of service. The court stated that when the amount of property sought to be taken is grossly in excess of the amount necessary to the public use, the taking must be stopped. 2. [3.8] Public Purpose Prior to January 1, 2007, 735 ILCS 5/7-102 had established the requirement that eminent domain be used only for a public purpose, which it referred to as a “public use.” The standards as to what constituted a public use were set forth in People ex rel. Tuohy v. City of Chicago, 394 Ill. 477, 68 N.E.2d 761 (1946), and later confirmed in Southwestern Illinois Development Authority v. National City Environmental, L.L.C., 199 Ill.2d 225, 768 N.E.2d 1, 263 Ill.Dec. 241 (2002). Some of the standards are as follows: a. The public must, to some extent, be entitled to use or enjoy the property, not as a mere favor or by permission of the owner, but by right. b. The benefit may be confined to a particular district but must be directly beneficial to a considerable number of inhabitants and must be controlled by law for the advantage of that particular portion of the community to be benefited. c. All persons must have an equal right to the use of the property and land may not be acquired by condemnation for private use. Poole v. City of Kankakee, 406 Ill. 521, 94 N.E.2d 416 (1950). However, the court held that the fact that the acquisition of land by eminent domain proceedings must be for a public purpose does not mean that the land subsequently sold to a private developer could not have been taken and cleared for a public purpose. City of Chicago v. Midland Smelting Co., 385 Ill.App.3d 945, 896 N.E.2d 364, 324 Ill.Dec. 578 (1st Dist. 2008); Southwestern Illinois Development Authority v. Al-Muhajirum, 318 Ill.App.3d 1005, 744 N.E.2d 308, 253 Ill.Dec. 26 (5th Dist. 2001). In Lake Louise Improvement Ass’n v. Multimedia Cablevision of Oak Lawn, Inc., 157 Ill.App.3d 713, 510 N.E.2d 982, 109 Ill.Dec. 914 (1st Dist. 1987), a cable television system was found to be for a public purpose rather than a private purpose. See also Village of Skokie v. Gianoulis, 260 Ill.App.3d 287, 632 N.E.2d 106, 198



Ill.Dec. 47 (1st Dist. 1994); Alsip Park District v. D & M Partnership, 252 Ill.App.3d 277, 625 N.E.2d 40, 192 Ill.Dec. 80 (1st Dist. 1993); County of Wabash v. Partee, 241 Ill.App.3d 59, 608 N.E.2d 674, 181 Ill.Dec. 601 (5th Dist. 1993). d. Revenue expansion through increased revenues, standing alone, is insufficient to establish a public purpose. National City Environmental, supra. In the event that a question arises as to whether the purpose for which the action is filed is a public purpose, it is suggested that the attorney for the condemnee might find additional authorities in National City Environmental, supra; Friends of Parks v. Chicago Park District, 203 Ill.2d 312, 786 N.E.2d 161, 271 Ill.Dec. 903 (2003); People v. Chicago Transit Authority, 392 Ill. 77, 64 N.E.2d 4 (1945); Poole, supra; Department of Public Works & Buildings v. Farina, 29 Ill.2d 474, 194 N.E.2d 209 (1963); Department of Public Works & Buildings of State of Illinois v. Koch, 62 Ill.App.2d 182, 210 N.E.2d 236 (4th Dist. 1965); Village of Long Grove v. First National Bank of Lake Forest, 164 Ill.App.3d 253, 517 N.E.2d 729, 115 Ill.Dec. 318 (2d Dist. 1987). In County of St. Clair v. Faust, 278 Ill.App.3d 152, 662 N.E.2d 584, 214 Ill.Dec. 1018 (5th Dist. 1996), the court held that the taking of acreage for wetland mitigation was authorized and was an appropriate use of eminent domain. In City of Chicago v. Boulevard Bank National Ass’n, 293 Ill.App.3d 767, 688 N.E.2d 844, 228 Ill.Dec. 146 (1st Dist. 1997), the court affirmed the trial court’s decision that redevelopment in a commercially blighted area is a proper public purpose in the use of a tax-increment financing (TIF) ordinance. See also Al-Muhajirum, supra. In contrast, see Kleinschmidt Inc. v. County of Cook, 287 Ill.App.3d 312, 678 N.E.2d 1065, 223 Ill.Dec. 57 (2d Dist. 1997). Notwithstanding the foregoing standards on public purpose/public use, the following provisions of the Eminent Domain Act define public purpose/public use: 735 ILCS 30/5-5-5, 30/10-5-10, 30/10-5-105, 30/15-1-5, 30/15-5-1 through 30/15-5-40, 30/20-5-5, and 30/25-7-103.1 through 30/25-7-103.149. Despite the definition of public purpose/public use as set forth in the Eminent Domain Act, a question that has not yet been tested with the courts is whether the legislative determination of public purpose/public use constitutionally prevails over what the Illinois Supreme Court has said is a judicial determination. National City Environmental, supra. However, consideration should be given to the pronouncement of the U.S. Supreme Court in Kelo v. City of New London, Connecticut, 545 U.S. 469, 162 L.Ed.2d 439, 125 S.Ct. 2655 (2005), in which the Court held that each state is free to legislatively or judicially define “public purpose.” For an interesting discussion of whether “substitution of uses,” which occurs when the condemnor seeks to relocate a property owner from the pathway of an improvement and condemns the property to provide replacement land, constitutes a public purpose/public use see: Department of Transportation of State of Illinois v. V.I.P. Manor, Inc., 117 Ill.App.3d 137, 453 N.E.2d 44, 72 Ill.Dec. 739 (5th Dist. 1983); Illinois State Toll Highway Authority v. Karn, 9 Ill.App.3d 784, 293 N.E.2d 162 (2d Dist. 1973); Department of Public Works & Buildings of State of Illinois v. Bozarth, 101 Ill.App.2d 99, 242 N.E.2d 54 (4th Dist. 1968). Following the appellate court ruling in National City Environmental, supra, however, that same appellate court decided Al-Muhajirum, supra, finding that the elimination of slums and blighted property is a proper use for a valid public purpose despite the property’s ultimate transfer to a private third party. But see Kleinschmidt, supra.



3. [3.9] Bona Fide Attempt To Agree The Eminent Domain Act requires that before an eminent domain action can be filed, an effort must be made to agree on compensation unless the owner of the property is incapable of consenting, the owner’s name or residence is unknown, or the owner is a nonresident of the state. 735 ILCS 30/10-5-10. Although at first blush it would appear that the legislature intended that there be some “negotiations” between the condemnor and the condemnee, that may not be the case. As a practical matter, what generally happens is that the condemning authority, which has much longer to prepare than the condemnee, has an appraisal in hand, makes an offer based on that appraisal, and gives the individual a limited number of days within which to accept or reject it. The failure to accept the offer within that time period generally leads to the filing of the complaint. (However, the property owner now receives the advance warnings required by 735 ILCS 30/10-5-15 giving 60 days within which to start preparation in state cases.) Exhaustive negotiations are, therefore, not required. If there is a wide disparity in the relative positions of the parties, the courts have concluded that futile negotiations are not required. County Board of School Trustees of DuPage County v. Boram, 26 Ill.2d 167, 186 N.E.2d 275 (1962). In Forest Preserve District of DuPage County v. Brookwood Land Venture, 229 Ill.App.3d 978, 595 N.E.2d 136, 172 Ill.Dec. 73 (2d Dist. 1992), the court held that when circumstances demonstrate that an agreement is unreachable, no further negotiations are necessary. In Illinois State Toll Highway Authority v. DiBenedetto, 275 Ill.App.3d 400, 655 N.E.2d 1085, 211 Ill.Dec. 702 (1st Dist. 1995), both the majority and the dissent engaged in a good discussion of what constitutes good faith. It is a condition precedent to the exercise of the power of eminent domain that the acquiring authority make a good-faith attempt to reach an agreement on compensation. Lake County Forest Preserve District v. First National Bank of Waukegan, 200 Ill.App.3d 354, 558 N.E.2d 721, 146 Ill.Dec. 758 (2d Dist. 1990). “Good faith” includes the obligation of the condemning authority to provide to the condemnee a copy of the condemning authority’s complete appraisal. Department of Transportation v. Hunziker, 342 Ill.App.3d 588, 796 N.E.2d 122, 277 Ill.Dec. 407 (3d Dist. 2003). However, see Department of Transportation of State of Illinois v. Tucker, 366 Ill.App.3d 739, 853 N.E.2d 749, 304 Ill.Dec. 672 (3d Dist. 2006), wherein the Third District reversed itself and held that good-faith negotiation does not require that the condemnee be provided with a copy of the condemning authority’s appraisal. For an example of a bad-faith offer, see Forest Preserve District of Will County v. Marquette National Bank, 208 Ill.App.3d 823, 567 N.E.2d 635, 153 Ill.Dec. 677 (3d Dist. 1991). See also City of Springfield, Illinois v. West Koke Mill Development Corp., 312 Ill.App.3d 900, 728 N.E.2d 781, 245 Ill.Dec. 699 (4th Dist. 2000). For additional information on this point, see Department of Transportation of State of Illinois v. Marsh, 54 Ill.App.3d 890, 368 N.E.2d 172, 10 Ill.Dec. 686 (4th Dist. 1977); County Board of School Trustees of Macon County v. Batchelder, 7 Ill.2d 178, 130 N.E.2d 175 (1955); City of Chicago v. Harrison-Halsted Building Corp., 11 Ill.2d 431, 143 N.E.2d 40 (1957); Patrick Media Group, Inc. v. DuPage Water Commission, 258 Ill.App.3d 1068, 630 N.E.2d 958, 196 Ill.Dec. 793 (1st Dist. 1994); County of Wabash v. Partee, 241 Ill.App.3d 59, 608 N.E.2d 674, 181 Ill.Dec. 601 (5th Dist. 1993); Department of Transportation, State of Illinois v. Anderson, 384 Ill.App.3d 309, 892 N.E.2d 116, 322 Ill.Dec. 869 (3d Dist. 2008); Forest Preserve District of DuPage County v. First National Bank of Franklin Park, 401 Ill.App.3d 966, 930 N.E.2d 477, 341 Ill.Dec. 267 (2d Dist. 2010).



4. [3.10] Condemnor’s Authority The Eminent Domain Act provides, inter alia,

When the right . . . to take private property for public use, without the owner’s consent . . . has been or is conferred by general law or special charter . . . the party authorized to take or damage the property so required . . . may apply to the circuit court of the county where the property or any part of the property is situated, by filing with the clerk a complaint. The complaint shall set forth, by reference . . . the complainant’s authority in the premises. 735 ILCS 30/10-5-10(a).

A traverse and motion to dismiss places in issue all of those points that could otherwise be raised by way of an answer to the complaint for condemnation. Inasmuch as §10-5-10 sets forth that the condemnor must in its complaint state its authority, the traverse, by disputing that fact, places the burden on the condemnor to prove its authority. Department of Public Works & Buildings v. Keller, 61 Ill.2d 320, 335 N.E.2d 443 (1975); Forest Preserve District of DuPage County v. Miller, 339 Ill.App.3d 244, 789 N.E.2d 916, 273 Ill.Dec. 742 (2d Dist. 2003). Once a traverse has been filed, the burden of proof is on the condemnor to make a prima facie showing to support the allegations set forth in the condemnation complaint including the condemnor’s authority for the condemnation action. Miller, supra; Board of Trustees of Southern Illinois University v. Lange, 28 Ill.2d 229, 190 N.E.2d 789 (1963). A condemnor has only the powers of eminent domain that are conferred on it by the appropriate legislative body if a statue or ordinance conferring the power of eminent domain must be strictly construed. Forest Preserve District of DuPage County v. Brown Family Trust, 323 Ill.App.3d 686, 753 N.E.2d 1110, 257 Ill.Dec. 484 (2d Dist. 2001). Note, however, although an ordinance delegating the power of eminent domain is to be strictly construed, the ordinance is presumed valid and the burden of establishing the invalidity of the ordinance is on the condemnee challenging the ordinance. Id. For an interesting discussion of an attempt by the Illinois Department of Transportation to expand its authority and the limitation created thereon by the Fifth District, see Department of Transportation of State of State of Illinois v. V.I.P. Manor, Inc., 117 Ill.App.3d 137, 453 N.E.2d 44, 72 Ill.Dec. 739 (5th Dist. 1983). However, when a highway commissioner failed to plead allegations meeting the statutory requirements, it was held that it was not a condition precedent to the exercise of the power of eminent domain. Town of Cotton Hill Road District v. Hockenyos, 130 Ill.App.3d 379, 474 N.E.2d 422, 85 Ill.Dec. 694 (4th Dist. 1985); Trotter v. Spezio, 349 Ill.App.3d 959, 812 N.E.2d 577, 285 Ill.Dec. 757 (3d Dist. 2004). A municipality can exercise the power of eminent domain only when it has been specifically conferred by legislative enactment (City of Oakbrook Terrace v. LaSalle National Bank, 186 Ill.App.3d 343, 542 N.E.2d 478, 134 Ill.Dec. 299 (2d Dist. 1989)) and then only in the manner and by the agency so empowered (Village of Long Grove v. First National Bank of Lake Forest, 164 Ill.App.3d 253, 517 N.E.2d 729, 115 Ill.Dec. 318 (2d Dist. 1987); Brown Family Trust, supra). See also Forest Preserve District of DuPage County v. West Suburban Bank, 161 Ill.2d 448, 641 N.E.2d 493, 204 Ill.Dec. 269 (1994). However, if the property is not necessary for the



public project, there is no constitutional authority to take the property despite what the legislature has asserted in the authorizing statute. Village of Bensenville v. City of Chicago, 389 Ill.App.3d 446, 906 N.E.2d 556, 329 Ill.Dec. 358 (2d Dist. 2009). In City of Marseilles v. Radke, 287 Ill.App.3d 757, 679 N.E.2d 125, 223 Ill.Dec. 181 (3d Dist. 1997), the appellate court held that the record failed to establish that the easement sought by the city was within the legal description of the tax-increment financing district contained in the notice published prior to the adoption of the ordinance establishing the TIF district and that, therefore, the circuit court did not have subject-matter jurisdiction. See City of Chicago v. Boulevard Bank National Ass’n, 293 Ill.App.3d 767, 688 N.E.2d 844, 228 Ill.Dec. 146 (1st Dist. 1997). In City of Batavia v. Sandberg, 286 Ill.App.3d 991, 677 N.E.2d 1010, 222 Ill.Dec. 476 (2d Dist. 1997), the court held that the city had followed the Tax Increment Allocation Redevelopment Act (TIA), 65 ILCS 5/11-74.4-1, et seq., and its own ordinances, and that the city thus had authority to acquire the building by eminent domain. In Village of Cary v. Trout Valley Ass’n, 282 Ill.App.3d 165, 667 N.E.2d 1082, 217 Ill.Dec. 689 (2d Dist. 1996), the court held that the village did not have authority to condemn when its ordinance did not contain the necessary requirements. In Illinois State Toll Highway Authority v. DiBenedetto, 275 Ill.App.3d 400, 655 N.E.2d 1085, 211 Ill.Dec. 702 (1st Dist. 1995), the court held that the resolution authorizing condemnation had not adequately identified the property. For an interesting examination of what happens when a village attempts to require an exaction, see Amoco Oil Co. v. Village of Schaumburg, 277 Ill.App.3d 926, 661 N.E.2d 380, 214 Ill.Dec. 526 (1st Dist. 1995). 5. [3.11] Property Subject to Condemnation Regarding property subject to condemnation, the Eminent Domain Act provides that:

[n]o property, . . . belonging to a railroad or other public utility subject to the jurisdiction of the Illinois Commerce Commission may be taken or damaged, pursuant to the provisions of this Act, without the prior approval of the Illinois Commerce Commission. 735 ILCS 30/10-5-10(g).

Property already devoted to a public purpose cannot be condemned without specific authority. See Department of Public Works & Buildings v. Ells, 23 Ill.2d 619, 179 N.E.2d 679 (1962); Village of Elmwood Park v. Forest Preserve of Cook County, 21 Ill.App.3d 597, 316 N.E.2d 140 (1st Dist. 1974). See also City of Evanston v. Regional Transportation Authority, 202 Ill.App.3d 265, 559 N.E.2d 899, 147 Ill.Dec. 559 (1st Dist. 1990); Village of Woodridge v. Board of Education of Community High School District 99, 403 Ill.App.3d 559, 933 N.E.2d 392, 342 Ill.Dec. 806 (2d Dist. 2010). For a discussion regarding property condemned under the Public Utilities Act, 220 ILCS 5/1-101, et seq., see Kreutzer v. Illinois Commerce Commission, 404 Ill.App.3d 791, 936 N.E.2d 147, 344 Ill.Dec. 5 (2d Dist. 2010). For a discussion regarding the condemnation of tax increment financing bonds, see City of Chicago v. Prologis, 236 Ill.2d 69, 923 N.E.2d 285, 337 Ill.Dec. 726 (2010).



For an interesting discussion on what property constitutes the “whole property” for purposes of determining the fair market value of the property sought to be taken and damage to the remainder, see Illinois Department of Natural Resources v. Pedigo, 348 Ill.App.3d 1044, 811 N.E.2d 761, 285 Ill.Dec. 274 (4th Dist. 2004). 6. [3.12] Proper Description Although it is too often taken for granted, the legal description of the property to be acquired is an important element of the complaint and should be examined by the condemnee’s attorney. The Eminent Domain Act requires that a legal description be included in the complaint. 735 ILCS 30/10-5-10. The condemnor is responsible for an accurate description. Department of Public Works & Buildings v. Finks, 10 Ill.2d 20, 139 N.E.2d 242 (1956); Department of Conservation of State of Illinois v. Harold’s Farm, Inc., 68 Ill.App.3d 148, 385 N.E.2d 1097, 24 Ill.Dec. 807 (3d Dist. 1978). See Illinois State Toll Highway Authority v. DiBenedetto, 275 Ill.App.3d 400, 655 N.E.2d 1085, 211 Ill.Dec. 702 (1st Dist. 1995). However, the long-standing caselaw holds that the property description in a condemnation complaint is sufficient if a competent surveyor can locate the land sought to be condemned. Union Electric Power Co. v. Sauget, 1 Ill.2d 125, 115 N.E.2d 246 (1953); Smith v. Claussen Park Drainage & Levee Dist., 229 Ill. 155, 82 N.E.278 (1907); City of Winchester v. Ring, 312 Ill. 544, 144 N.E. 333 (1924). See also Department of Public Works & Buildings v. Watson, 340 Ill 342, 172 N.E. 718 (1930) (blueprints attached to complaint for condemnation provide sufficient property description). D. [3.13] When Traverse Does Not Lie There are a number of areas in which a traverse has been held not to lie. Failing to name a necessary party is not fatal but, rather, means only that the action is not binding on the omitted party. Department of Transportation of State of Illinois v. Collins, 69 Ill.App.3d 269, 387 N.E.2d 6, 25 Ill.Dec. 549 (3d Dist. 1979); Department of Transportation of State of Illinois v. Marsh, 54 Ill.App.3d 890, 368 N.E.2d 172, 10 Ill.Dec. 686 (4th Dist. 1977). Failure to have the funds on hand with which to pay for the project is not a proper basis to challenge the action of the condemning authority. However, this issue may be raised in an inquiry concerning lack of diligence since the condemning authority cannot obtain title until the funds are deposited with the county treasurer. City of Chicago v. McCluer, 339 Ill. 610, 171 N.E. 737 (1930). In an interesting discussion concerning the term “final” as it relates to plans, the Fifth District, in Department of Transportation of State of Illinois v. Keller, 127 Ill.App.3d 976, 469 N.E.2d 262, 82 Ill.Dec. 728 (5th Dist. 1984), held that the Illinois Department of Transportation can use alternative definitions of the term “final” at various stages of the construction planning and construction itself. Logically, one would think that the plans should be final before the condemning authority proceeds with land acquisition, but such is not the case. See Department of Public Works & Buildings of State of Illinois v. Vogt, 51 Ill.App.3d 770, 366 N.E.2d 310, 9 Ill.Dec. 53 (5th Dist. 1977). See also City of Chicago v. Albert J. Schorsch Realty Co., 127 Ill.App.2d 51, 261 N.E.2d 711 (1st Dist. 1970).



Unless the condemnee can show a clear abuse of power, the condemnee is not permitted to go into the discretion of the condemning agency in its determination to acquire the subject property. Department of Transportation of State of Illinois v. Keller, 149 Ill.App.3d 829, 500 N.E.2d 982, 102 Ill.Dec. 881 (5th Dist. 1986); Department of Transportation v. Sunnyside Partnership, L.P., 337 Ill.App.3d 322, 785 N.E.2d 1018, 271 Ill.Dec. 824 (5th Dist. 2003). The Illinois Supreme Court, in People ex rel. Director of Finance v. Young Women’s Christian Association of Springfield, 86 Ill.2d 219, 427 N.E.2d 70, 55 Ill.Dec. 950 (1981), however, held that from the facts presented in that case, the Capital Development Board was seeking to acquire more land than it needed. E. [3.14] Trial of a Traverse The trial of a traverse is no different than any other trial. Often the parties believe that the hearing is similar to that of a motion hearing. However, the traverse is, in fact, a trial of the allegations raised in the pleading filed by the condemnee’s attorney. Southwestern Illinois Development Authority v. National City Environmental, L.L.C., 304 Ill.App.3d 542, 710 N.E.2d 896, 238 Ill.Dec. 99 (5th Dist. 1999), aff’d, 199 Ill.2d 225 (2002). The burden is on the condemnor on each of the points raised in the traverse. Trustees of Schools of Township No. 37 v. First National Bank of Blue Island, 49 Ill.2d 408, 274 N.E.2d 56 (1971); Board of Trustees of Southern Illinois University v. Lange, 28 Ill.2d 229, 190 N.E.2d 789 (1963); City of Evanston v. Piotrowicz, 20 Ill.2d 512, 170 N.E.2d 569 (1960). The condemnor must make a prima facie case on each of the disputed allegations before the burden shifts to the condemnee. Department of Public Works & Buildings v. Keller, 61 Ill.2d 320, 335 N.E.2d 443 (1975). After the condemnor establishes its prima facie case, the burden then shifts to the condemnee. Lake County Forest Preserve District v. First National Bank of Waukegan, 154 Ill.App.3d 45, 506 N.E.2d 424, 106 Ill.Dec. 717 (2d Dist. 1987). See also City of Oakbrook Terrace v. LaSalle National Bank, 186 Ill.App.3d 343, 542 N.E.2d 478, 134 Ill.Dec. 299 (2d Dist. 1989); Department of Transportation v. First Galesburg National Bank & Trust Co., 189 Ill.App.3d 797, 545 N.E.2d 770, 137 Ill.Dec. 117 (3d Dist. 1989), rev’d, 141 Ill.2d 462 (1990). As a tactical matter, it would not seem to serve any purpose to “save” any information since the hearing on the traverse is the only opportunity when the disputed questions of necessity, public purpose, bona fide attempt to agree, authority, and legal description can be raised. The condemnee’s attorney should be prepared with evidence on the disputed points. If in fact the traverse is simply a broad-range attack on the complaint, the trial court may very well limit the scope of the traverse hearing to only those contested points. A condemnee’s attorney who has done an adequate job of preparation and discovery should not be surprised. Because of the importance of the hearing on the traverse, counsel for the condemnee should not be rushed into a proceeding without an adequate opportunity to prepare. Once the traverse is decided, the only remaining issue is valuation, and if the condemnee is serious in its opposition to the allegations of the complaint, the traverse trial will be its only chance to try these issues. See City of Chicago v. Anthony, 136 Ill.2d 169, 554 N.E.2d 1381, 1383, 144 Ill.Dec. 93 (1990); Village of Cary v. Trout Valley Ass’n, 282 Ill.App.3d 165, 667 N.E.2d 1082, 217 Ill.Dec. 689 (2d Dist. 1996); City of Batavia v. Sandberg, 286 Ill.App.3d 991, 677 N.E.2d 1010, 222 Ill.Dec. 476 (2d Dist. 1997).



F. [3.15] If the Traverse Is Denied An order denying the traverse is not a final and appealable order. Village of River Forest v. Ash Realty Co., 23 Ill.App.3d 645, 321 N.E.2d 68 (1st Dist. 1974). The findings in a motion for immediate vesting of title are final and appealable (735 ILCS 30/20-5-10(b)), under S.Ct. Rule 307(a)(7). While at first blush it would appear that some of the same points are involved, no appeal of the order denying the traverse can be taken under S.Ct. Rule 301. See Southwestern Illinois Development Authority v. Vollman, 235 Ill.App.3d 32, 600 N.E.2d 926, 175 Ill.Dec. 683 (5th Dist. 1992); Department of Transportation v. 151 Interstate Road Corp., 209 Ill.2d 471, 810 N.E.2d 1, 284 Ill.Dec. 348 (2004). NOTE: 151 Interstate, supra, overruled Southwestern Illinois Development Authority v. National City Environmental, L.L.C., 199 Ill.2d 225, 768 N.E.2d 1, 263 Ill.Dec. 241 (2002), by holding that the issue of whether a condemnor negotiated in “good faith” can be raised in an interlocutory appeal. G. [3.16] If the Traverse Is Granted If the traverse and motion to dismiss are granted and if the condemnor cannot rectify the errors in its complaint, then the court’s order is treated the same way as any other order dismissing a complaint. Counsel for the condemnee should review the provisions of the Eminent Domain Act regarding the possibility of moving for an order assessing costs, expenses, and reasonable attorneys’ fees. 735 ILCS 30/20-5-45. See Town of Libertyville v. Bank of Waukegan, 152 Ill.App.3d 1066, 504 N.E.2d 1305, 105 Ill.Dec. 787 (2d Dist. 1987). V. [3.17] COUNTERCLAIM Starting with the Illinois Pattern Jury Instructions — Civil (2000), the term “counterclaim” has been used for what was previously called a “cross-petition.” See 735 ILCS 5/2-608 for the rules on counterclaims. The courts in Department of Transportation ex rel. State of Illinois v. First National Bank of Arcola, 241 Ill.App.3d 601, 609 N.E.2d 389, 182 Ill.Dec. 86 (4th Dist. 1993), and Department of Transportation v. HP/Meachum Land Limited Partnership, 245 Ill.App.3d 252, 614 N.E.2d 485, 185 Ill.Dec. 351 (2d Dist. 1993), also used the term “counterclaim” referring to what previously was referred to as a “cross-petition.” A counterclaim alleges that property not described in the complaint to condemn is damaged by virtue of the taking (also known as “damage to the remainder”) and that the condemnee is entitled to compensation for that damage. For an example of a counterclaim, see §3.25 below. See also Chapter 7 of this handbook. While some cases have held that a counterclaim is not required when the complaint describes the defendant as the owner of a parcel of property and states that only a part of the property is required for the condemnor’s purposes, the safer course of action is to file the counterclaim. Central Illinois Public Service Co. v. Rider, 12 Ill.2d 326, 146 N.E.2d 48 (1957). Although efforts have been made to challenge the Illinois Department of Transportation by including in the subject matter of the counterclaim elements other than simply damage to the remainder, at least the Fifth and Fourth Districts have limited the scope of the counterclaim. In



Department of Transportation v. McGovern, 103 Ill.App.3d 461, 431 N.E.2d 437, 59 Ill.Dec. 152 (5th Dist. 1982), the optionees filed a counterclaim for damage alleging that the Department failed to comply with §4-510 of the Illinois Highway Code, 605 ILCS 5/1-101, et seq. They sought to recover damages alleged to have resulted from their failure to exercise an option to purchase real estate after expending large sums in reliance on the Department’s representation that it did not intend to acquire the land in question. The court held that a counterclaim was not the appropriate remedy for such damage, but rather, the exclusive remedy was found in the Court of Claims Act, 705 ILCS 505/1, et seq. Likewise, in Evans v. Brown, 267 Ill.App.3d 662, 642 N.E.2d 1335, 205 Ill.Dec. 218 (4th Dist. 1994), the court held that the Court of Claims has exclusive jurisdiction. As an interesting aside, see Vogt v. Bartelsmeyer, 264 Ill.App.3d 165, 636 N.E.2d 1185, 201 Ill.Dec. 753 (5th Dist. 1994), in which the court upheld the lower court’s enforcement of an agreement reached in an earlier action. See the earlier related decision Department of Transportation v. Schien, 72 Ill.2d 287, 381 N.E.2d 241, 21 Ill.Dec. 163 (1978). The Eminent Domain Act provides that any person who has not been made a party may become one by filing an intervening complaint setting forth the interests of the intervenor in the property sought to be taken or damaged. 735 ILCS 30/10-5-75. This complaint may be in the nature of a counterclaim, but needless to say, if a proper party is not added initially to the complaint, the burden is not on the condemnee to supply information to the plaintiff since, under 735 ILCS 30/10-5-10, the burden is on the condemnor to list in the complaint the names of all persons interested in the property. Remember that by filing a counterclaim the right to file a traverse and motion to dismiss may be treated as waived (see §3.5 above), so the better practice would be to file the traverse initially. Harvey v. Aurora & G. Ry., 174 Ill. 295, 51 N.E. 163 (1898). A proper counterclaim should include a description of the property alleged to have been damaged by the taking, the ownership thereof, and the reason for the claim of damage. Rider, supra. From a timing standpoint, it is best to file the counterclaim after an adverse ruling on the traverse simply to make certain that jurisdictional questions are not waived. Harvey, supra. If a condemnee’s attorney is confronted with the need for a late filing of a counterclaim, reference should be had to the following cases: Rider, supra; Forest Preserve District of Cook County v. Krol, 12 Ill.2d 139, 145 N.E.2d 599 (1957); Lake County Forest Preserve District v. Continental Illinois National Bank & Trust Company of Chicago, 35 Ill.App.3d 942, 343 N.E.2d 6 (2d Dist. 1976). As to the question of the possible waiver of any deficiency in a counterclaim, see City of Chicago v. Chicago City Bank & Trust Co., 129 Ill.App.3d 410, 472 N.E.2d 827, 84 Ill.Dec. 690 (1st Dist. 1984). VI. [3.18] RIGHT TO OPEN AND CLOSE In Department of Business & Economic Development v. Brummel, 52 Ill.2d 538, 288 N.E.2d 392, 395 (1972), the court set forth the various scenarios as to which party proceeds first in the trial of the cause, concluding that when a cross-petition (now counterclaim) has been filed, the



landowner may file a motion to proceed first and the court may order the landowner to so proceed. Since Brummel, a number of courts have addressed the issue. In Department of Public Works & Buildings of State of Illinois v. Roehrig, 45 Ill.App.3d 189, 359 N.E.2d 752, 3 Ill.Dec. 893 (5th Dist. 1976), the court held that it was error, although not reversible error, to permit the landowner to open and close even though there was no cross-petition. In Department of Transportation ex rel. State of Illinois v. First National Bank of Arcola, 241 Ill.App.3d 601, 609 N.E.2d 389, 390 – 391, 182 Ill.Dec. 86 (4th Dist. 1993), citing Brummel, supra, the court held that when there is a counterclaim, the determination as to which party proceeds first is in the sound discretion of the court. In First National, actions involving two separate parcels were consolidated for trial. In only one of the cases was a counterclaim filed. The preferred course is to file a motion to open and close and urge the court that the party who has the real burden of proof is the owner, who must prove damage to the remainder. Although the condemnor has the burden of proving the fair cash market value of the part taken, the instructions, unlike the typical instructions defining burden of proof, simply direct the jury to find within the range of the evidence. For a sample motion to open and close, see §3.26 below. VII. [3.19] VIEW OF PREMISES The Eminent Domain Act requires that the jury be permitted to view (inspect) the property sought to be taken or damaged upon the request of either party. 735 ILCS 30/10-5-45. Viewing the premises is a good way to educate the jury to counsel’s theory of the value of the property, including damages to the remainder, as it gives the jury a real sense of the lay of the condemnee’s land, as well as the surrounding area. See §3.27 below for a motion for view of the premises. VIII. [3.20] LATER MOTIONS Counsel should not feel limited to the motions presented thus far in this chapter. The possible course of action for the condemnee’s attorney is limited only by his or her imagination. In Department of Transportation v. Schien, 72 Ill.2d 287, 381 N.E.2d 241, 21 Ill.Dec. 163 (1978), the complaint was dismissed for failure to diligently pursue the project, although the court converted the finding of preliminary just compensation to a finding of final just compensation. In Department of Transportation v. Catholic Diocese of Belleville, 63 Ill.App.3d 683, 379 N.E.2d 1343, 20 Ill.Dec. 275 (5th Dist. 1978), the date of valuation was changed and no comment was made about this in the appellate court decision. In Department of Public Works & Buildings of State of Illinois v. Roehrig, 45 Ill.App.3d 189, 359 N.E.2d 752, 3 Ill.Dec. 893 (5th Dist. 1976), the Fifth District made certain pronouncements concerning abusive discovery. All of these areas, and others, can provide fertile ground for the imaginative attorney. Roehrig was cited in the non-eminent domain case, Lundell v. Citrano, 129 Ill.App.3d 390, 472 N.E.2d 541, 84 Ill.Dec. 581 (1st Dist. 1984), in a discussion on in limine motions — often a good trial tactic. See also In re Estate of Loesch, 134 Ill.App.3d 766, 481 N.E.2d 32, 89 Ill.Dec. 680 (1st Dist. 1985), for a similar discussion.



In People ex rel. Department of Transportation v. Birger, 155 Ill.App.3d 130, 507 N.E.2d 1321, 107 Ill.Dec. 952 (5th Dist. 1987), the Department’s attorney permitted a state appraiser to read daily transcripts even though a motion to preclude witnesses had previously been granted. Although the trial court permitted wide cross-examination and although no mention of the error was made in the appeal because it was the Department rather than the landowner who appealed, attention should be addressed to such abusive possibilities. See Illinois State Toll Highway Authority v. West Suburban Bank, 208 Ill.App.3d 923, 567 N.E.2d 730, 153 Ill.Dec. 772 (2d Dist. 1991), in which the court held that even when an expert had testified at a previous quick-take hearing, that expert must still be later disclosed to comply with former S.Ct. Rule 220, now S.Ct. Rule 213(f). But see Illinois State Toll Highway Authority v. Dicke, 208 Ill.App.3d 158, 566 N.E.2d 1003, 153 Ill.Dec. 153 (2d Dist. 1991), for certain pitfalls. The court held it was error for the owners’ counsel to argue and their expert witness to testify concerning a post-filing offer to purchase the subject property. Further, alleged comparable properties are, in fact, not comparable and are inadmissible if the alleged comparable property is not similar in kind, character, use, zoning, and locale. See Board of Trustees of University of Illinois v. Shapiro, 343 Ill.App.3d 943, 799 N.E.2d 383, 278 Ill.Dec. 665 (1st Dist. 2003); DuPage Bank & Trust Co. v. Property Tax Appeal Board of Illinois Department of Revenue, 151 Ill.App.3d. 624, 502 N.E.2d 1250, 104 Ill.Dec. 590 (2d Dist. 1986); Department of Conservation of State of Illinois v. Strassheim, 92 Ill.App.3d 689, 415 N.E.2d 1346, 48 Ill.Dec. 62 (2d Dist. 1981). If the attorney can be successful in a dismissal later in the proceedings, this would, of course, necessitate the refiling by the condemnor and the use of a new valuation date. See Trustees of Schools of Township No. 37 v. First National Bank of Blue Island, 49 Ill.2d 408, 274 N.E.2d 56 (1971); Department of Public Works & Buildings of State of Illinois v. American National Bank & Trust Co., 36 Ill.App.3d 439, 343 N.E.2d 686 (2d Dist. 1976); Sanitary Dist. of Chicago v. Chapin, 226 Ill. 499, 80 N.E. 1017 (1907); Department of Transportation of State of Illinois v. Schien, 50 Ill.App.3d 73, 365 N.E.2d 702, 8 Ill.Dec. 464 (4th Dist. 1977), aff’d, 72 Ill.2d 287 (1978). When the condemnor uses the quick-take procedure, the condemnee is entitled to interest on the difference between the amount found to be preliminary just compensation and the amount found to be final just compensation. Although quick-take is treated extensively in Chapter 4 of this handbook, it should be noted that the condemnee’s attorney may want to establish the applicable interest rate. The issue of interest has been refined in Illinois State Toll Highway Authority v. American National Bank & Trust Company of Chicago, 162 Ill.2d 181, 642 N.E.2d 1249, 205 Ill.Dec. 132 (1994). IX. [3.21] SIGNIFICANT DECISIONS Forest Preserve District of DuPage County v. First National Bank of Franklin Park, 2011 IL 110759, 961 N.E.2d 775, 356 Ill.Dec. 386, held that a taking occurs on the date that the condemnor (a) deposits the amount of compensation that has been ascertained and awarded and (b) acquires title and the right to possess the property. The court also noted that the Fifth Amendment mandates that a land owner be awarded just compensation, which is the fair market value of the property on the date of the taking. Potential conflict exists between the cases that



hold that the value of the property taken is to be determined as of the date of the filing of the complaint and the constitutional mandate, as stated in this case, to pay just compensation (the fair market value of the property taken) as of the date of the taking. Public Building Commission of Chicago v. Yellen, 2013 IL App (1st) 112638, ¶33, 986 N.E.2d 706, 369 Ill.Dec. 393, quoting Department of Public Works & Buildings v. Metropolitan Life Insurance Co., 42 Ill.App.2d 378, 192 N.E.2d 607, 615 (1st Dist. 1963), held that the fair market value of the property is ascertained as of the date of the filing of the condemnation action and does not include “any element resulting subsequently to or because of the taking.” This case also discusses leasehold values. Village of North Pekin v. Adams Outdoor Advertising, 2013 IL App (3d) 120249-U, held that a local ordinance of North Pekin is invalid because it mandates the removal of billboards without just compensation to the sign owners and is contrary to the Eminent Domain Act. Pedigo v. Flood ex. rel. People, 2013 IL App (4th) 120023-U, discusses the difference between a taking of property giving rise to a claim for just compensation under the EDA and a damaging of property that does not give rise to a claim under the EDA. Village of Bellwood v. American National Bank & Trust Company of Chicago, 2011 IL App (1st) 093115, 952 N.E.2d 148, 351 Ill.Dec. 775, permitted the condemnor to abandon the eminent domain proceedings after a settlement agreement had been reached in the pending lawsuits but before the condemnor took possession of the properties, as the condemnor had a statutory right to abandon eminent domain proceedings and the settlement agreement did not constitute a waiver of the statutory right. Village of Algonquin v. Lowe, 2011 IL App (2d) 100603, 954 N.E.2d 228, 352 Ill.Dec. 368, held that an eminent domain action is not an “in rem” proceeding and the court must have personal jurisdiction over the parties having an interest in the property. X. [3.22] FINAL CONCERNS Efforts should be made throughout the case to remain prepared and to review the case continuously. A change in plans with inactivity on the part of the condemnor could result in a. a change in valuation date (Department of Transportation v. Catholic Diocese of

Belleville, 63 Ill.App.3d 683, 379 N.E.2d 1343, 20 Ill.Dec. 275 (5th Dist. 1978); 735 ILCS 30/10-5-60); or

b. even a dismissal (Department of Transportation v. Schien, 72 Ill.2d 287, 381 N.E.2d 241,

21 Ill.Dec. 163 (1978)). Other efforts should be made to make certain that the condemnor complies with discovery requests. See Department of Public Works & Buildings of State of Illinois v. Roehrig, 45 Ill.App.3d 189, 359 N.E.2d 752, 3 Ill.Dec. 893 (5th Dist. 1976).



As in any case, an attorney also might consider a stipulation and agreement as to an issue in the case to expedite the trial. City of Crystal Lake v. LaSalle Nat’l Bank, 121 Ill.App.3d 346, 459 N.E.2d 643, 76 Ill.Dec. 728 (2d Dist. 1984). In County of St. Clair v. Wilson, 284 Ill.App.3d 79, 672 N.E.2d 27, 219 Ill.Dec. 712 (5th Dist. 1996), the court reversed the trial court’s refusal to admit into evidence bona fide offers to purchase adjacent property when all of the appraisers testified that such offers are the kind of data that appraisers would rely on in preparing appraisals. The presence of comparable sales data does not automatically exclude evidence of offers to purchase on the issue of just compensation. The court also noted that the prior employment of the appraiser may be admissible. See also Department of Transportation v. Beeson, 137 Ill.App.3d 908, 485 N.E.2d 511, 92 Ill.Dec. 700 (2d Dist. 1985) (adopting Federal Rules of Evidence 703 and 705). In City of Quincy, Illinois v. Diamond Construction Co., 327 Ill.App.3d 338, 762 N.E.2d 710, 715, 261 Ill.Dec. 141 (4th Dist. 2002), the appellate court affirmed the trial court’s decision to exclude a second appraisal on the subject tract that considered that the asphalt plant on the property was in the process of being moved because of the taking, citing “principles of fundamental fairness.” Consider that as a basis, if possible!

PRACTICE POINTERS

Use your imagination. You may not always be successful in advancing certain theories, but why not try? See People ex rel. Department of Transportation v. Birger, 155 Ill.App.3d 130, 507 N.E.2d 1321, 107 Ill.Dec. 952 (5th Dist. 1987) (number of interesting factual materials offered into evidence); Department of Transportation of State of Illinois v. Gass, 165 Ill.App.3d 562, 519 N.E.2d 90, 116 Ill.Dec. 500 (5th Dist. 1988) (unsuccessful attempt made to include adjoining leaseholds in counterclaim); Department of Transportation of State of Illinois v. Keller, 149 Ill.App.3d 829, 500 N.E.2d 982, 102 Ill.Dec. 881 (5th Dist. 1986) (horseradish was deemed specialty crop and income approach thereby admissible); Department of Transportation v. Shell Oil Co., 156 Ill.App.3d 304, 509 N.E.2d 596, 108 Ill.Dec. 900 (1st Dist. 1987) (decrease in volume of gasoline sold at service station was admissible not as to raw data but as to foundation for decrease in market value).

If you continue to prepare your case the same way you would prepare one in which a

large personal injury claim is at stake, the condemnee will be adequately represented.



XI. APPENDIX — FORMS A. [3.23] Motion for Production of Witnesses, Documents, Etc.

[Caption]

NOTICE PURSUANT TO SUPREME COURT RULE 237 TO: DEPARTMENT OF TRANSPORTATION AND: Special Assistant Attorney General [address] Comes now the defendant, [defendant’s name], by and through [his] [her] attorney, [attorney’s name], and pursuant to Rule 237 directs that the plaintiff produce at the hearing on the Motion for Immediate Vesting the following: names of people at the Department with knowledge of the case; all books, documents, and records relating to the construction plans for the proposed improvement; all books, documents, records, transcripts, and memoranda relating to any and all public hearings held on said proposed improvement; all books, documents, and records relative to the preparation of the Environmental Impact Statement for said project and all of its drafts; all invoices and bids on the preparation of the Environmental Impact Statement for the proposed improvement; a list of the names and addresses of all parties with whom the plaintiff has settled for the acquisition of properties for the proposed improvements, including the amounts paid and the acreages acquired; and the names and addresses of all landowners from whom the plaintiff seeks to acquire property for the proposed improvement and the acreages to be acquired. ______________________________________ [defendant] By: ______________________________________ [attorney] [address] B. [3.24] Traverse and Motion To Dismiss

[Caption]

TRAVERSE AND MOTION TO DISMISS Comes now the defendant herein, [defendant’s name], by and through [his] [her] attorney, [attorney’s name], and for [his] [her] Traverse and Motion To Dismiss states: 1. That the plaintiff is not vested with authority to acquire the property of the defendant by proceeding in eminent domain.



2. That the property sought to be acquired in this proceeding is not necessary or convenient for the purpose for which it is sought to be taken. 3. That the amount of property sought to be taken by the plaintiff herein is in excess of the plaintiff’s needs. 4. That the plaintiff does not seek to use the property sought to be acquired by this proceeding for a public purpose. 5. That there has been no bona fide attempt to agree with the defendant as to the just compensation and damages to be paid for the property sought to be taken. 6. That the project for which the plaintiff seeks to acquire the lands of the defendant is not necessary. 7. That there has been no hearing on the necessity of the improvement. 8. That there has been no public hearing on the legitimacy of locating the improvement on the location as designated by the plaintiff. ______________________________________ [defendant] By: ______________________________________ [attorney] [address] C. [3.25] Counterclaim

[Caption]

COUNTERCLAIM Comes now the defendant, [defendant’s name], by and through [his] [her] attorney, [attorney’s name], and for [his] [her] Counterclaim represents to the court as follows: 1. The real property legally described in the Complaint To Condemn is a part only of the real estate, the legal description for which is as follows:

[legal description] 2. The whole tract, as described above, is owned and used in common with the property legally described in the Complaint To Condemn.



3. The taking of the real property by the plaintiff will result in damages to the remainder of the real property not taken. WHEREFORE, the defendant prays that [his] [her] damages to the remainder of the real property not taken be assessed in these proceedings against the plaintiff and that a judgment for damages and costs of suit be entered for the defendant. ______________________________________ [defendant] By: ______________________________________ [attorney] [address] D. [3.26] Motion To Open and Close

[Caption]

MOTION TO OPEN AND CLOSE Comes now the defendant, [defendant’s name], by and through [his] [her] attorney, [attorney’s name], and moves this Honorable Court for an order permitting the defendant to open and close during the trial of this cause, and in support thereof, states: 1. That the defendant has filed a counterclaim as to lands not taken. 2. That, pursuant to Department of Public Works & Buildings of State of Illinois v. Roehrig, 45 Ill.App.3d 189, 359 N.E.2d 752, 3 Ill.Dec. 893 (5th Dist. 1976), Department of Transportation ex rel. State of Illinois v. First National Bank of Arcola, 241 Ill.App.3d 601, 609 N.E.2d 389, 182 Ill.Dec. 86 (4th Dist. 1993), and Department of Business & Economic Development v. Brummel, 52 Ill.2d 538, 288 N.E.2d 392 (1972), subject to the discretion of the court, the landowner when a counterclaim has been filed should be permitted to open and close inasmuch as the landowner has the burden of proof on the question of damages to the remainder. ______________________________________ [defendant] By: ______________________________________ [attorney] [address]



E. [3.27] Motion for View of Premises

[Caption]

MOTION FOR VIEW OF PREMISES Comes now the defendant, [defendant’s name], by and through [his] [her] attorney, [attorney’s name], and pursuant to 735 ILCS 30/10-5-45, moves this Honorable Court for a view of the premises during the trial of this cause, and in support thereof states: 1. That 735 ILCS 30/10-5-45 provides that the jury “shall, at the request of either party, go upon the land sought to be taken or damaged and examine the same.” 2. That the defendant desires a view of [his] [her] property pursuant to that section. WHEREFORE, the defendant prays that this Honorable Court enter an Order directing a view of the premises. ______________________________________ [defendant] By: ______________________________________ [attorney] [address]


Quick-Take VALERIE M. MOEHLE Moehle, Swearingen & Assoc., Ltd. Pekin

4



I. [4.1] Scope of Chapter II. [4.2] Purpose of Quick-Take III. Who Has Quick-Take Powers? A. [4.3] Source of Quick-Take Powers B. [4.4] Entities Granted Quick-Take Powers C. [4.5] Limits on Quick-Take Powers IV. How Is Quick-Take Commenced? A. [4.6] Time for Filing of Motion B. [4.7] Contents of Motion C. [4.8] Setting the Hearing D. [4.9] Service of Motion and Notice of Hearing E. [4.10] Necessary Proofs at Quick-Take Hearing 1. [4.11] Plaintiff’s Right To Acquire the Property by Condemnation a. [4.12] Plaintiff Has Authority To Acquire the Property by Condemnation b. [4.13] The Property Is Subject to the Right or Authority of Condemnation c. [4.14] The Right Is Being Exercised Properly 2. [4.15] Necessity for Use of Quick-Take Procedures 3. [4.16] Amount of Preliminary Just Compensation V. [4.17] Order Fixing Preliminary Just Compensation VI. [4.18] Deposit of Funds and Vesting of Title VII. [4.19] Withdrawal of Preliminary Just Compensation VIII. Ancillary Issues A. [4.20] Discovery B. [4.21] View of Premises at Quick-Take C. [4.22] Interest D. [4.23] Valuation Date E. [4.24] Alternative to Quick-Take

QUICK-TAKE


IX. Appeals A. [4.25] Appealable Issues B. [4.26] Stay Pending Appeal C. [4.27] Dismissal of Complaint on Appeal X. Subsequent Proceedings A. [4.28] Matters at Quick-Take Not Admissible at Trial B. [4.29] Dismissal or Abandonment by the Plaintiff XI. Sample Pleadings and Documents A. [4.30] Sample Motion for Immediate Vesting of Title B. [4.31] Sample Publication Notice C. [4.32] Sample Order Setting Hearing on Motion for Immediate Vesting of Title D. [4.33] Sample Order Fixing Preliminary Just Compensation E. [4.34] Sample Treasurer’s Receipt F. [4.35] Sample Order Vesting Title G. [4.36] Sample Motion To Withdraw Preliminary Just Compensation H. [4.37] Sample Order Authorizing Withdrawal of Preliminary Just Compensation



I. [4.1] SCOPE OF CHAPTER The statutory method to obtain early possession of property in a condemnation action is referred to as “quick-take.” Quick-take is authorized by §20-5-5(b) of the Eminent Domain Act (EDA), 735 ILCS 30/1-1-1, et seq., which provides:

[T]he plaintiff, at any time after the complaint has been filed and before judgment is entered in the proceeding, may file a written motion requesting that, immediately or at some specified later date, the plaintiff either: (i) be vested with the fee simple title (or such lesser estate, interest, or easement, as may be required) to the real property, or a specified portion of that property, which is the subject of the proceeding, and be authorized to take possession of and use the property; or (ii) only be authorized to take possession of and to use the property, if possession and use, without the vesting of title, are sufficient to permit the plaintiff to proceed with the project until the final ascertainment of compensation. 735 ILCS 30/20-5-5(b).

This chapter discusses the procedure and the proofs required to use quick-take. II. [4.2] PURPOSE OF QUICK-TAKE Quick-take is intended to be quick.

In recognizing the fact that the greatest potential for delay in eminent domain is ascertaining the value of the property to be taken, the legislature designed quick-take proceedings to avoid delay in needed construction. The purpose of the proceeding is to pass possession and title in the condemnor prior to final determination of just compensation and yet protect the interest of the condemnee. City of Chicago v. First Bank of Oak Park, 178 Ill.App.3d 321, 533 N.E.2d 424, 426, 127 Ill.Dec. 552 (1st Dist. 1988).

See also Department of Public Works & Buildings v. Dust, 19 Ill.2d 217, 166 N.E.2d 36, 39 (1960). “Quick,” of course, can be a relative term. The larger the project, the earlier the public body should commence quick-take proceedings to complete all acquisitions and secure possession in advance of the letting date for the construction contract. Court calendars, attorney and witness schedules, the time needed for the owner to vacate the property, and the time it takes to receive preliminary compensation checks from the public body can also necessitate that quick-take be commenced far in advance of the letting date for the construction contract to have sufficient time to acquire title and secure possession.

QUICK-TAKE §4.5


III. WHO HAS QUICK-TAKE POWERS? A. [4.3] Source of Quick-Take Powers Eminent domain power is inherent in the state, with limits placed on the power by the Constitution. This power can be exercised only as prescribed by the legislature. Illinois State Trust Co. v. St. Louis, I.M. & S. Ry., 208 Ill. 419, 70 N.E. 357, 358 (1904); Department of Public Works & Buildings v. Schlich, 359 Ill. 337, 194 N.E. 587, 590 (1935); ILL.CONST. art. I, §15. The legislature has adopted the quick-take statute to provide a special procedure to expedite condemnation within the confines of the Constitution. A predecessor statute similar to the present quick-take statute has been held constitutional. Department of Public Works & Buildings v. Butler Co., 13 Ill.2d 537, 150 N.E.2d 124 (1958). See also Central Illinois Public Service Co. v. Gibbel, 65 Ill.App.3d 890, 382 N.E.2d 846, 22 Ill.Dec. 456 (4th Dist. 1978). B. [4.4] Entities Granted Quick-Take Powers Because the quick-take power may be exercised only as permitted by the legislature, it must be specifically granted by the legislature, and such grants are strictly construed. Department of Transportation of State of Illinois ex rel. People v. V.I.P. Manor, Inc., 117 Ill.App.3d 137, 453 N.E.2d 44, 46, 72 Ill.Dec. 739 (5th Dist. 1983). It is therefore important for both the plaintiff and the defendant to identify the specific statutory section under which the power is granted. Historically, quick-take powers have been granted by the legislature for broad purposes, such as to the State of Illinois, the Illinois State Toll Highway Authority, and the St. Louis Metropolitan Area Airport Authority for highway purposes. 735 ILCS 30/25-7-103.1. The legislature has also granted powers to special groups or specific public bodies for limited purposes, such as local road projects, waste treatment facilities, municipal airports, waterway maintenance, and numerous other projects. See, e.g., 735 ILCS 30/25-7-103.5, et seq. The legislature has granted condemnation and quick-take powers for redevelopment purposes, and a general grant of quick-take power is given to home-rule municipalities for properties in an enterprise zone. 735 ILCS 30/25-7-103.13. Specific grants have also been given for specific tax-increment financing districts or redevelopment projects. See, e.g., 735 ILCS 30/25-7-103.62, 30/25-7-103.68, 30/25-7-103.69. Additional grants are contained outside the quick-take statute. See, e.g., 70 ILCS 520/8, 3205/12; 735 ILCS 30/15-5-1, et seq., contains a list of all eminent domain statutes and notes if quick-take powers are included. These special grants have survived challenges to their constitutionality as “special legislation.” See, e.g., City of Chicago v. Boulevard Bank National Ass’n, 293 Ill.App.3d 767, 688 N.E.2d 844, 854, 228 Ill.Dec. 146 (1st Dist. 1997). Under the statutory organization, grants prior to the 2007 Eminent Domain Act are located under 735 ILCS 30/25-7-103.1, et seq., and grants after the Eminent Domain Act are located under 735 ILCS 30/25-5-5, et seq. C. [4.5] Limits on Quick-Take Powers Some landowners are protected from immediate use of quick-take powers. If the State of Illinois, the Illinois State Toll Highway Authority, a sanitary district, the St. Louis Metropolitan Area Airport Authority, or the Board of Trustees of the University of Illinois seeks to acquire the



property of a common carrier engaged in interstate commerce or a public utility subject to the Illinois Commerce Commission (ICC) by quick-take, it must first obtain approval of the ICC. 735 ILCS 30/20-5-5. The requirement of preapproval from the ICC prior to condemnation in 735 ILCS 30/10-5-10(g) and the requirements for contents of the motion for quick-take recited in §20-5-5 do not mirror this language. IV. HOW IS QUICK-TAKE COMMENCED? A. [4.6] Time for Filing of Motion A quick-take motion can be filed only in an existing condemnation case. 735 ILCS 30/20-5-5(b). The quick-take motion, usually titled a “Motion for Immediate Vesting of Title” (see the sample in §4.30 below), may be filed at any time after the complaint, including immediately thereafter. Id. If the circuit clerk’s office’s file stamp includes the date and the time, the plaintiff should make certain that one minute has passed between the filing of the complaint and the motion so that no question of timing can arise. B. [4.7] Contents of Motion The contents of the motion for immediate vesting of title are dictated by the legislature in 735 ILCS 30/20-5-5: 1. The motion must include an accurate description of the property. The property must be “described with reasonable certainty.” Forest Preserve Dist. of Cook County v. Lehmann Estate, Inc., 388 Ill. 416, 58 N.E.2d 538, 540 (1944). At a minimum, this should include the legal description by subdivision or metes and bounds. This is the same legal description used in the complaint unless quick-take is needed or authorized for only a lesser tract. It is also helpful, but not required, to include a common address, property identification number, or survey. 2. The motion must include the estate or interest sought to be acquired. This might be fee simple, right-of-way, permanent easement or temporary easement for a set time, or any other estate or interest recognized by law. 3. The motion must also state the formally adopted schedule or plan of operation for the execution of the plaintiff’s project. This schedule or plan may be appended as an exhibit to the motion and explained generally within the body of the motion. See Department of Transportation of State of Illinois ex rel. People v. Collins, 69 Ill.App.3d 269, 387 N.E.2d 6, 10, 25 Ill.Dec. 549 (3d Dist. 1979). In cases filed for the Illinois Department of Transportation (IDOT), some courts have permitted the plaintiff to file with the court one complete plan (covering the entire state of Illinois) and serve the parties with only the relevant excerpts from the plan relating to the project at issue. If, however, a party requests the entire plan, the plaintiff should provide it immediately, if practical or not unduly burdensome. In City of Chicago v. St. John’s United Church of Christ, 404 Ill.App.3d 505, 935 N.E.2d 1158, 343 Ill.Dec. 930 (2d Dist. 2010), the court held that the city was not required to attach the schedule for the entire O’Hare modernization project (a massive,

QUICK-TAKE §4.9


multistage project) but, instead, could supply the proposed schedule for that part of the project requiring the property being condemned. 4. The motion must discuss the situation of the property to which the motion relates with respect to the schedule or plan. In other words, the motion should state that the property is necessary for the project. It is also helpful to state the specific use intended for the property, such as construction of a school building, new road construction, grading and shaping, or equipment storage and staging during the project. 5. The motion must state the necessity for taking the property by quick-take. The plaintiff should state that it has been unable to acquire the property by negotiation and what the impact of further delay in acquisition will be, such as an increase in construction costs and a delay in the elimination of traffic hazards. 6. For property subject to Interstate Commerce Commission approval, the plaintiff must state that such approval has been obtained, and a certified copy of the order must be attached. See §4.30 below for a sample quick-take motion. C. [4.8] Setting the Hearing The hearing must be set at least five days after the filing of the motion, and the statute requires that the “court” set the date. 735 ILCS 30/20-5-10(a). Thus, most condemnation attorneys, in addition to a notice of hearing, also prepare an order setting the hearing on the motion for immediate vesting of title. See the sample in §4.32 below. This order is presented ex parte to the court after obtaining a date and time from the scheduling clerk. If there are more than a few parcels involved in the project, the plaintiff’s attorney should take time before the cases are filed to explain the volume of upcoming filings and the scheduling needs to the scheduling clerk so that any scheduling issues may be worked out before the orders are presented to the court. D. [4.9] Service of Motion and Notice of Hearing Section 20-5-10(a) of the Eminent Domain Act states that the court “shall require due notice to be given to each party to the proceeding whose interests would be affected by the taking requested, except that any party who has been or is being served by publication and who has not entered his or her appearance in the proceeding need not be given notice unless the court so requires, in its discretion and in the interests of justice.” 735 ILCS 20/5-10(a). In the eminent domain context, due process requires only a postdeprivation hearing, which can be provided in an inverse condemnation case brought by the landowner. Department of Public Works & Buildings v. Butler Co., 13 Ill.2d 537, 150 N.E.2d 124, 130 (1958); Times Mirror Cable Television of Springfield, Inc. v. First National Bank of Springfield, 221 Ill.App.3d 340, 582 N.E.2d 216, 220, 164 Ill.Dec. 8 (4th Dist. 1991); Muscarello v. Village of Hampshire, 644 F.Supp. 1016, 1017 – 1019 (N.D.Ill. 1986); Bieneman v. City of Chicago, 662 F.Supp. 1297, 1301 (N.D.Ill. 1987).



Thus, compliance with the notice provisions of the quick-take statute exceeds the requirements of due process. Therefore, it appears that notice of the quick-take hearing may be served in any manner permitted for the service of motions and notices by the Civil Practice Law, 735 ILCS 5/2-101, et seq., Illinois Supreme Court Rule 11, and local court rule. A party who has been or is being served by publication (and who has not entered his or her appearance) does not have to be given notice of the hearing unless required by the court. 735 ILCS 30/20-5-10(a); Butler, supra (failure to give notice to publication defendant is not violation of due process). See §4.31 below for a sample publication notice that includes a notice of the quick-take hearing. However, some trial courts have required proof of jurisdiction over all parties prior to proceeding to a quick-take hearing. This requires that the complaint and summons in the underlying case have been served according to statute, either personally or by publication. If there is difficulty obtaining prompt service on a party, the plaintiff can use the procedure provided in 735 ILCS 5/2-203.1 to obtain a special order of the court for service. See In re Marriage of Schmitt, 321 Ill.App.3d 360, 747 N.E.2d 524, 254 Ill.Dec. 484 (2d Dist. 2001). It has been held that such an order can only be prospective in nature. See Hotel Employees & Restaurant Employees International Union Welfare Fund v. Printer’s Row, LLC, No. 06 C 4630, 2008 WL 5142187 (N.D.Ill. Dec. 5, 2008). It can be advantageous to file the motion immediately after the complaint so that the documents can be served together, thereby saving the cost and extra effort of serving the motion while also eliminating issues of proper service of the motion or proper notice. If the motion is not served with the summons and complaint, many plaintiffs’ attorneys choose to serve it by certified and regular mail, again to eliminate any issues of notice and service. It is also a good idea to include a copy of the complaint with the mailing of the motion if the complaint has not yet been served. The goal of the plaintiff in quick-take is a prompt and fair proceeding that will not be overturned on appeal. A few extra precautions at the notice stage can help accomplish that result. E. [4.10] Necessary Proofs at Quick-Take Hearing Normally, a quick-take hearing is the first hearing held in the case. Thus, the plaintiff must prove up its complaint at the hearing (Department of Public Works & Buildings v. Dust, 19 Ill.2d 217, 166 N.E.2d 36 (1960)) and then present evidence as to just compensation. Under some circumstances, the prove-up may have occurred earlier, and the only issue for the quick-take hearing is just compensation. Sections 4.11 – 4.16 below, however, assume that the quick-take hearing is the first hearing in the case. The 2007 enactment of the Eminent Domain Act has created some special proofs and requirements for certain types of condemnations. Any special proofs or prerequisites for condemnation of a parcel must also be met at the quick-take hearing. Examples of some of these

QUICK-TAKE §4.12


requirements are included in §§4.11 – 4.16 below, but the examples are not intended to be exhaustive. At the quick-take hearing, the plaintiff must make a prima facie case that (1) it has a right to acquire the property by condemnation, (2) use of the quick-take procedure is necessary, and (3) establishes the amount of preliminary just compensation. 735 ILCS 30/20-5-10(b), 30/20-5-10(c). See Department of Transportation v. First Galesburg National Bank & Trust Co., 141 Ill.2d 462, 566 N.E.2d 254, 257 – 258, 152 Ill.Dec. 567 (1990). This is a three-stage proceeding in which the plaintiff must prove each stage before moving on to the next. Id. The burden of proof in a quick-take proceeding is the same as in a condemnation proceeding; no heightened burden is imposed due to the expedited nature of the proceeding. Id. However, the EDA may require a heightened level of proof in the underlying condemnation proceeding, which would appear to carry over to the quick-take proceeding. See, e.g., 735 ILCS 30/5-5-5(c). 1. [4.11] Plaintiff’s Right To Acquire the Property by Condemnation The plaintiff’s right to acquire the property by condemnation includes three elements: (a) the plaintiff has authority to acquire the property by condemnation; (b) the property is subject to the right or authority of condemnation; and (c) the right or authority is being properly exercised. 735 ILCS 30/20-5-10(b); Department of Public Works & Buildings v. Dust, 19 Ill.2d 217, 166 N.E.2d 36, 39 (1960). See §§4.12 – 4.14 below. After the plaintiff has presented its proof on these issues, the plaintiff should request a finding that it has proved that it has the authority to exercise the right of condemnation. While the plaintiff often tenders the witness for cross-examination at this point, such a tender should be required only if a traverse has been filed; otherwise, the plaintiff may find itself in a de facto traverse hearing without advance notice or preparation. This issue was presented in People ex rel. Department of Transportation v. Kotara, L.L.C., 379 Ill.App.3d 276, 884 N.E.2d 1235, 318 Ill.Dec. 964 (3d Dist. 2008). The defendant filed its traverse the day before the quick-take hearing; the trial court refused to hear the traverse until proper notice was given to the plaintiff, and the quick-take proceeded as scheduled. The trial court then prohibited the defendant from cross-examination on issues raised in its traverse, including the issue of whether the plaintiff negotiated in good faith. The appellate court reversed this ruling, finding that because good-faith negotiations are an element of the plaintiff’s proofs, the defendant should have been permitted to cross-examine on this issue. The appellate court did not discuss the issue of surprise or the underlying legal principles of proof of a prima facie case. Cf. Commonwealth Edison Co. v. Danekas, 104 Ill.App.3d 907, 433 N.E.2d 736, 740, 60 Ill.Dec. 694 (2d Dist. 1982); Department of Business & Economic Development v. Brummel, 52 Ill.2d 538, 288 N.E.2d 392 (1972) (court considers element of surprise when determining whether party is prejudiced by last-minute change in order of proceeding). a. [4.12] Plaintiff Has Authority To Acquire the Property by Condemnation The court may take judicial notice of the authority to exercise the right of eminent domain when granted by statute, and no other proof is needed. Department of Public Works & Buildings v. Dust, 19 Ill.2d 217, 166 N.E.2d 36, 40 (1960). However, eminent domain statutes are in



derogation of the rights of citizens and are strictly construed. Department of Public Works & Buildings v. Ryan, 357 Ill. 150, 191 N.E. 259, 261 – 262 (1934); County of DeKalb v. Smith, 213 Ill.App.3d 775, 572 N.E.2d 379, 382, 157 Ill.Dec. 310 (2d Dist. 1991). The plaintiff is not required to allege or to place the authorizing resolution or ordinance into evidence, but the property owner, on a traverse, can question the authority of the plaintiff to proceed under the statute, and if the ordinance or resolution is not produced, the court will find a lack of authority. City of Mound City v. Mason, 262 Ill. 392, 104 N.E. 685, 686 (1914). b. [4.13] The Property Is Subject to the Right or Authority of Condemnation Only private property is subject to the right of condemnation. ILL.CONST. art. I, §15; Pittsburgh, Ft. W. & C. Ry. v. Sanitary Dist. of Chicago, 218 Ill. 286, 75 N.E. 892, 895 (1905). The plaintiff should prove up, through a title commitment and other evidence, the ownership and other interests in the property. In MCI WorldCom Communications, Inc. v. Metra Commuter Rail Division of Regional Transportation Authority, 337 Ill.App.3d 576, 786 N.E.2d 621, 272 Ill.Dec. 82 (2d Dist. 2003), MCI WorldCom contended that §4 of the Telephone Company Act, 220 ILCS 65/0.01, et seq., granted it authority to condemn railroad property regardless of whether the railroad was a private or public entity. The court held that any power to condemn public property must be expressly granted by statute and found no such express grant in the Telephone Company Act. One of the apparent impetuses for the Eminent Domain Act was the continued blurring of the line between public and private use. This gray area may gravitate to the private property analysis, as these public-private entities find themselves the subject of eminent domain suits. See, e.g., Illinois Clean Energy Community Foundation v. Filan, 392 F.3d 934 (7th Cir. 2004) (Illinois Clean Energy Community Foundation was private entity, not public entity, and thus any attempt by state to confiscate funds of Foundation would be violation of takings clause). c. [4.14] The Right Is Being Exercised Properly Proof that the right of eminent domain is being exercised properly requires proof of the following: The use is a public use. Department of Public Works & Buildings v. Dust, 19 Ill.2d 217, 166 N.E.2d 36, 40 (1960); Southwestern Illinois Development Authority v. National City Environmental, L.L.C., 199 Ill.2d 225, 768 N.E.2d 1, 263 Ill.Dec. 241 (2002). While the court makes the determination of public use, great deference is given to the legislative finding of public purpose. 768 N.E.2d at 8. The elimination of slums and blight for redevelopment is a public use. 768 N.E.2d at 9; Village of Wheeling v. Exchange National Bank of Chicago, 213 Ill.App.3d 325, 572 N.E.2d 966, 157 Ill.Dec. 502 (1st Dist. 1991). The acquisition of land for a gas station near a toll road is a valid public purpose because it serves the purpose of a limited access road and provides necessary services to travelers at the access points. Illinois State Toll Highway Commission v. Eden Cemetery Ass’n, 16 Ill.2d 539, 158 N.E.2d 766, 768 – 769 (1959). However, the acquisition of land to sell to a private racetrack for a parking lot was not a public purpose

QUICK-TAKE §4.14


because the court found no elimination of blight or slums and because the public was not the primary beneficiary of the taking. National City, supra, 768 N.E.2d at 9. The court, in this case, took a more activist approach and appeared to give less deference to the legislative finding of a public use. The public-use analysis has gained more public scrutiny as the public, legislatures, and courts have reacted to the Supreme Court’s decision in Kelo v. City of New London, Connecticut, 545 U.S. 469, 162 L.Ed.2d 439, 125 S.Ct. 2655 (2005). A full discussion of Kelo and its implications is beyond the scope of this chapter; however, it should be noted that the Eminent Domain Act has different types of proofs for various levels of public use. Thus, proving the type of public use at issue will determine what other proofs are necessary in the case. Examples from the EDA are as follows: Public ownership and control. The plaintiff “must prove that (i) the acquisition of the property is necessary for a public purpose and (ii) the acquired property will be owned and controlled by the condemning authority or another governmental entity.” [Emphasis added.] 735 ILCS 30/5-5-5(b). The public-ownership component usually has been presumed in traditional condemnations for roadways, fire stations, etc. The statute now, however, would require proof of the final intended owner. The benefit of proving the public ownership and control under this section is that the plaintiff then avoids many of the requirements and burdens imposed by the 2007 changes to eminent domain law. Private ownership or control or both. If the public use involves private ownership or control or both, then the plaintiff “must prove by clear and convincing evidence that the acquisition of the property for private ownership or control is (i) primarily for the benefit, use, or enjoyment of the public and (ii) necessary for a public purpose.” [Emphasis added.] 735 ILCS 30/5-5-5(c). This heightened level of proof is not required if the acquisition falls under subsections (a-5), (a-10), (d), (e), or (f) of §5-5-5. The Act contains various rebuttable presumptions to aid in the proofs required by subsection (c). By exempting itself from subsection (c), the plaintiff, however, does not eliminate the necessity for special proofs; it is then required to follow the special-proof requirements of the subsection under which it is proceeding. The location is a proper location. See Department of Public Works & Buildings of State of Illinois ex rel. People v. Neace, 13 Ill.App.3d 982, 301 N.E.2d 509, 512 (2d Dist. 1973). Cf. Department of Public Works & Buildings v. Schlich, 359 Ill. 337, 194 N.E. 587 (1935). See also Department of Transportation v. Sunnyside Partnership, L.P., 337 Ill.App.3d 322, 785 N.E.2d 1018, 1024, 271 Ill.Dec. 824 (5th Dist. 2003) (court found property necessary for intended purpose and refused to review alternate plans considered and rejected by Illinois Department of Transportation). The amount of land taken is not excessive. The condemning authority is “permitted a large discretion in determining for itself the amount of land to be taken” (City of Chicago v. Vaccarro, 408 Ill. 587, 97 N.E.2d 766, 772 (1951)), and “the court will not inquire into the extent to which the property is necessary for such use unless it appears that the quantity of property taken is grossly in excess of the amount necessary for the use” (Smith v. Claussen Park Drainage & Levee



Dist., 229 Ill. 155, 82 N.E. 278, 281 (1907)). See People ex rel. Director of Finance v. Young Women’s Christian Association of Springfield, 86 Ill.2d 219, 427 N.E.2d 70, 79 – 80, 55 Ill.Dec. 950 (1981) (court found taking was excessive when only half of land was necessary for valid public use). The plaintiff has made a reasonable, good-faith attempt to agree with the owner, the owner is incapable of consenting to an amount of compensation, the owner is unknown or cannot be found, or the owner is not a resident of the State of Illinois. 735 ILCS 30/10-5-10. The plaintiff should introduce its final offer to the landowner. If the plaintiff is the State of Illinois, the 60-day letter should be introduced. See 735 ILCS 30/10-5-15(d). For discussion, see Chapter 2 of this handbook. In addition, the State of Illinois should also be prepared to prove that it complied with the introductory letter requirements of §10-5-15(c). In Department of Transportation ex rel. People v. 151 Interstate Road Corp., 209 Ill.2d 471, 810 N.E.2d 1, 7, 284 Ill.Dec. 348 (2004), the court stated: “[W]hether a condemnor has negotiated in good faith bears directly on whether the condemnor was exercising its right of eminent domain improperly.” The court analyzed the 60-day letter very closely in conjunction with a later offer by IDOT. The court found that the amount of land to be acquired and the amount paid per acre changed, resulting in a less advantageous offer to the landowner in the final offer before trial. The court found that this required a new 60-day letter on the less advantageous offer; otherwise, there was a failure to negotiate in good faith. Thus, the state needs to be prepared to explain or justify any discrepancies between the 60-day letter and the information presented at the quick-take hearing. 810 N.E.2d at 10. For a discussion of who qualifies as an “owner,” see Department of Transportation, State of Illinois v. Anderson, 384 Ill.App.3d 309, 892 N.E.2d 116, 322 Ill.Dec. 869 (3d Dist. 2008). For an analysis by the Supreme Court of a negotiation found to be in good faith as a matter of law, see Forest Preserve District of DuPage County v. First National Bank of Franklin Park, 2011 IL 110759, 961 N.E.2d 775, 356 Ill.Dec. 386. The interest sought is proper for the purpose. The plaintiff will typically seek fee simple title or a temporary or permanent easement. When the public body has determined the interest in land to be acquired, that determination is binding on the court. But if the legislation is silent, then the plaintiff must show what interest is needed to serve the public purpose. Department of Transportation v. First Galesburg National Bank & Trust Co., 141 Ill.2d 462, 566 N.E.2d 254, 258, 152 Ill.Dec. 567 (1990). The landowner cannot compel the condemning body to take more than the condemning body determines is necessary for its purpose. The landowner’s remedy is a claim for damages to the remainder. Department of Conservation of State of Illinois ex rel. People v. Harold’s Farm, Inc., 68 Ill.App.3d 148, 385 N.E.2d 1097, 1101, 24 Ill.Dec. 807 (3d Dist. 1978).

QUICK-TAKE §4.15


2. [4.15] Necessity for Use of Quick-Take Procedures The plaintiff must prove that the expedited procedure is necessary. “Necessary,” by analogy to the other uses of “necessary” under the condemnation statutes, means “ ‘expedient,’ ‘reasonably convenient,’ or ‘useful to the public.’ ” See Department of Public Works & Buildings v. Lewis, 411 Ill. 242, 103 N.E.2d 595, 597 (1952). It is best for the plaintiff to use one witness for this proof who can testify to the following: a. the formally adopted schedule or plan that was described in or attached to the quick-take

motion — this document can be proved up as a public record; b. the plan includes acquisition of the property of the defendant, and a portion of the project

will be constructed on the property; c. the letting date for the construction contract; d. that the property cannot be acquired by negotiation; e. that the project will be delayed if the property is not acquired promptly; and f. the effect of delay in the acquisition of the property, such as an increased cost of

construction, a possible loss of funding, a delay in the elimination of traffic hazards, or a delay in the decrease in accidents that the improvements will bring about.

In Department of Transportation v. Sunnyside Partnership, L.P., 337 Ill.App.3d 322, 785 N.E.2d 1018, 1024, 271 Ill.Dec. 824 (5th Dist. 2003), the court found the following irrelevant to the issue of immediacy: (a) the fact that the project was being let in sections and one portion had already been let; and (b) the fact that a participating local government had not secured all of its funding for a larger related project because the project for which the land was being acquired was necessary regardless of whether the larger project went forward. There is no requirement that the issues surrounding possession be litigated at this stage of the proceeding, and, in fact, the proper time for litigation is at the entry of the order vesting title. See 735 ILCS 30/20-5-15(a). However, it has been the practice of plaintiffs and the courts to consider the evidence at the quick-take hearing if it is generally uncontroverted so that the order vesting title may be presented ex parte to the court. If there is a complicated issue of possession, then the plaintiff should follow statutory procedure and give notice of presentation of the order vesting title to have a hearing on a defendant’s request for postponement of possession under §20-5-15(b). Thus, if there are no complicated issues surrounding possession, the plaintiff should state whether it is requesting immediate possession upon deposit of the quick-take amount or is requesting postponement of possession. The plaintiff may know that the defendant will need additional time to relocate or remove some improvements (e.g., growing crops on the land), and this evidence should be presented at this time. If the plaintiff is concerned about delay in removing the improvements, it may be necessary to present evidence of the cost to remove the



improvements and then ask that that amount be held by the treasurer pending proof that the defendant has removed the improvements. At the conclusion of its evidence, the plaintiff should tender the witness for cross-examination, since the issue of the necessity of quick-take is raised by the motion, not the complaint, and thus is not subject to a traverse. Upon completion, the plaintiff should ask the court for a finding that the necessity of quick-take has been proved. 3. [4.16] Amount of Preliminary Just Compensation In establishing proof of preliminary just compensation, the plaintiff may use a staff appraiser or an outside appraiser. This is the same proof that is required at the jury trial, except that if the matter is not contested at this stage, the appraiser can present minimum testimony needed to prove the valuation. The Eminent Domain Act requires payment of relocation costs in certain circumstances. 735 ILCS 30/10-5-62. These costs, however, are not included in the definition of “value” (735 ILCS 30/10-5-60) and thus should not be a part of the appraiser’s opinion or a proof at the quick-take hearing. The amount to be paid is the amount that would be paid under the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (URA), Pub.L. No. 91-646, 84 Stat. 1894. 735 ILCS 30/10-5-62. The Illinois Department of Transportation has adopted policies and procedures for applying the URA. See 92 Ill.Admin. Code pt. 518. Plaintiffs often have their appraiser testify to damage to the remainder, even though the defendant has not yet filed a counterclaim for damages. See Commonwealth Edison Co. v. Danekas, 104 Ill.App.3d 907, 433 N.E.2d 736, 739, 60 Ill.Dec. 694 (2d Dist. 1982) (it is defendant’s burden to prove damage to remainder if pleaded by defendant). This is certainly helpful to expedite an uncontested proceeding or to accomplish a settlement. However, in a contested proceeding, by including damage to the remainder in the offer and proofs, the plaintiff can open itself to challenges to its negotiation in good faith based on an item that is the defendant’s proof. See, e.g., People ex rel. Department of Transportation v. Kotara, L.L.C., 379 Ill.App.3d 276, 884 N.E.2d 1235, 318 Ill.Dec. 964 (3d Dist. 2008). Since the compensation to be paid is the fair market value of the property as of the date of the filing of the complaint (§10-5-60), the appraiser should testify as to the value as of that date. If at all possible, the appraiser should update his or her appraisal to the date of filing prior to attending the quick-take hearing. Updating the appraisal usually involves another view of the property. This update can result in an adjustment in value, depending on the age of the appraisal and what has happened to the property, the market, and the neighborhood in the meantime, or the appraisal methodology may change because of new analysis made in changing from a summary appraisal to a complete appraisal or because the original appraiser may not be available. This reevaluation can present a catch-22 for the plaintiff because the appraiser may be testifying to an amount greater than the plaintiff’s last offer, which may raise questions about negotiating in good faith. On the other hand, the appraisal can be two years old or more by the time the complaint is filed, and if the appraiser does not adjust the values, his or her credibility can be called into question if there has been clear market inflation or changes in the property or neighborhood.

QUICK-TAKE §4.18


Often, the defendant will not present valuation evidence at the quick-take hearing because the expense is not justified. However, the defendant may use the hearing as an opportunity for discovery and engage in extensive cross-examination of the plaintiff’s appraiser. Thus, the appraiser needs to be prepared for this possibility. There is also the possibility that the court will use the court-appointed appraiser method set out in 735 ILCS 30/20-5-10(c). This procedure is not often used. However, it can be a significant setback for the plaintiff because of the time involved. The plaintiff should strongly object if the defendant has already hired an appraiser, as the only result will be delay and added expense for the plaintiff. At the conclusion of the quick-take hearing, the court then makes a finding of the amount of preliminary just compensation. See §4.17 below. V. [4.17] ORDER FIXING PRELIMINARY JUST COMPENSATION At the conclusion of the quick-take hearing, the plaintiff should present a written order to the court containing all the necessary findings. The order should find that the plaintiff has the authority to exercise the right of eminent domain, the property is subject to the authority, the authority is not being improperly exercised, and reasonable necessity exists for the taking of the property by quick-take. The order should also state the value of the property taken and the damage to the remainder, if any. It should describe the property taken and the interest acquired (such as fee simple). Finally, it should provide that, upon deposit of the compensation with the treasurer, the court will enter an order vesting title in the plaintiff. If the date and terms of possession have been determined, they should be set out in this order and then repeated in the order vesting title. The order should also contain any condition of performance on the plaintiff. For example, for temporary easements for grading and shaping, the order should provide that construction work on the easement must be completed as specified in the plans prepared by the plaintiff in a good and workmanlike manner and must be paid for by the plaintiff. See §4.33 below for a sample order fixing preliminary just compensation. VI. [4.18] DEPOSIT OF FUNDS AND VESTING OF TITLE After entry of the order fixing preliminary just compensation, the plaintiff deposits the funds with the county treasurer and obtains a written receipt. See the sample in §4.34 below. The treasurer should also receive a copy of the order fixing preliminary just compensation. The receipt is filed with the court, and an order vesting title (see the sample in §4.35 below) may be presented ex parte to the court with the proof of payment if the issue of possession has been determined. This order should contain a legal description of the property, state the type of title that vests, and state whether the plaintiff obtains immediate possession or the conditions of possession if it is not immediate. Some of the compensation may be withheld if the plaintiff has



to remove improvements that were the defendant’s responsibility. If possession has not been previously determined, then, under 735 ILCS 30/20-5-15(a), it must be determined at this stage. The court may enter an order requiring the defendant to pay a reasonable rental to the plaintiff if there is a delay in possession of more than ten days. 735 ILCS 30/20-5-15(b). The plaintiff is entitled to injunctive or other appropriate relief (such as forcible entry and detainer) to obtain possession. Id. VII. [4.19] WITHDRAWAL OF PRELIMINARY JUST COMPENSATION A party interested in the property may petition for withdrawal of the funds if (a) the plaintiff has taken possession and (b) no appeal of the court order finding that the plaintiff has the power to acquire the property by condemnation has been or will be taken or such an appeal has been determined in favor of the plaintiff. 735 ILCS 30/20-5-20. The party must give notice to each party whose interests would be affected by the withdrawal. Id. This section is written the same as the quick-take section (735 ILCS 30/20-5-10(a)), requiring that the court “fix a date” and that due notice be given to each party whose interest would be affected by the taking. In practice, many defendants set their own hearing without court order and give notice to the plaintiff and all defendants. Although the plaintiff is not interested in who receives the money, it is still a party “affected by the withdrawal” and should receive notice to make sure that the two preconditions to withdrawal have been met, i.e., that possession has been secured and that no appeal has been or will be filed. 735 ILCS 30/20-5-20. All defendants who have not been defaulted should also be given notice. The party seeking to withdraw the funds will have to prove that it is entitled to the funds “according to the fair value of [its] legal or equitable interests.” 735 ILCS 30/10-5-90. Disputes between landlords and tenants, contract buyers and sellers, and landowners and mortgagees might have to be litigated at this stage. There are applicable standards for contract buyers and sellers. Id. The defendant may need to present releases from named parties, title insurance, or evidence of the terms of a lease, mortgage, or contract to purchase to establish its claim to the funds. In a simple case, a verified petition setting forth that the preconditions have been met and setting out the interests of the parties may suffice. Because the defendants may or may not earn interest on their funds while on deposit with the treasurer, depending on what the treasurer does with the funds (see Morton Grove Park District v. American National Bank & Trust Co., 78 Ill.2d 353, 399 N.E.2d 1295, 35 Ill.Dec. 767 (1980)), the defendants may agree to withdraw the funds and place them in an interest-bearing escrow, subject to distribution according to the final ruling of the court. See, e.g., Village of Palatine v. Palatine Associates, LLC, 2012 IL App (1st) 102707, ¶¶14 – 20, 966 N.E.2d 1174, 359 Ill.Dec. 486.

QUICK-TAKE §4.22


The order authorizing withdrawal of funds is then presented to the treasurer with written instructions for delivery of the check. See §§4.36 and 4.37 below for a sample motion to withdraw, and an order authorizing withdrawal of preliminary just compensation. VIII. ANCILLARY ISSUES A. [4.20] Discovery Because quick-take is intended to be quick and discovery is not quick, there is an inherent tension between quick-take procedures and discovery rules. Plaintiffs will want to object to any attempt to delay the quick-take procedure to conduct discovery. The two key issues to be addressed in a discovery objection are timing and whether the matter on which discovery is sought is subject to judicial review. Department of Transportation of State of Illinois ex rel. People v. Collins, 69 Ill.App.3d 269, 387 N.E.2d 6, 9, 25 Ill.Dec. 549 (3d Dist. 1979). An objection to discovery on the issue of valuation should be well-taken because that issue is not subject to judicial review (Department of Public Works & Buildings v. Dust, 19 Ill.2d 217, 166 N.E.2d 36, 40 – 41 (1960)), the issue can be fully and fairly litigated at a later date, and the defendant will be compensated with interest for any difference between the quick-take award and the final award (735 ILCS 30/20-5-30(1)). Discovery requests “related solely to the design and engineering portions of the project” have met the same result. Collins, supra, 387 N.E.2d at 9. Discovery on issues surrounding a traverse is more complicated. Plaintiffs should attempt to limit discovery to requests for production of documents and then should produce immediately. B. [4.21] View of Premises at Quick-Take No statute or caselaw prohibits or requires a judge’s view of the premises at quick-take. See 735 ILCS 30/10-5-45 (jury view of premises is mandatory if requested by either party); Department of Business & Economic Development v. Phillips, 43 Ill.2d 28, 251 N.E.2d 170, 174 (1969) (no constitutional right to jury view of premises prior to quick-take). Due to the preliminary nature of the proceeding, it is not common for either party to request such a view. C. [4.22] Interest The statutes do not provide for the payment of interest on the quick-take award between the dates of the order fixing preliminary just compensation and the order vesting title. There are likely two key reasons for this. First, the defendant has generally continued in use and possession of the property during that time (see, e.g., 735 ILCS 30/20-5-30(1), whereby interest on excess of the final award over the preliminary award is calculated back to the day that possession is surrendered), and second, the order is not a judgment that the plaintiff is required to pay because the plaintiff can dismiss its complaint between the entry of the order fixing preliminary just compensation and the vesting of title. See 735 ILCS 30/20-5-40; Department of Public Works &



Buildings of State of Illinois ex rel. People v. Vogt, 51 Ill.App.3d 770, 366 N.E.2d 310, 315, 9 Ill.Dec. 53 (5th Dist. 1977). If the final award exceeds the preliminary award, interest runs “from the date on which the parties interested in the property surrendered possession of the property in accordance with the order of taking, to the date of payment of the excess by the plaintiff.” 735 ILCS 30/20-5-30(1). While the statute calls for interest at six percent and excludes additional postjudgment interest under 735 ILCS 5/2-1303 or any other law (§20-5-30), the six-percent rate merely sets the floor as established by the legislature. Because the interest is a part of the just compensation contemplated by the Constitution, the amount of interest is ultimately determined by the judge or the jury, not the legislature. Illinois State Toll Highway Authority v. American National Bank & Trust Company of Chicago, 162 Ill.2d 181, 642 N.E.2d 1249, 1254 – 1255, 205 Ill.Dec. 132 (1994). The plaintiff does not have to pay any interest on the award once it is deposited with the treasurer, except as stated below. However, the treasurer will be required to pay the defendant the interest that it earns on the defendant’s money. Morton Grove Park District v. American National Bank & Trust Co., 78 Ill.2d 353, 399 N.E.2d 1295, 35 Ill.Dec. 767 (1980). If the plaintiff objects to the authority of the party to withdraw the preliminary compensation (other than due to a pending or contemplated appeal under 735 ILCS 30/20-5-10) and the plaintiff prevails, then the plaintiff must pay interest from the date of deposit to the date of payment to the petitioning party. 735 ILCS 30/20-5-30(2). When the plaintiff prevents the party from withdrawing the funds, even when the party eventually prevails and is able to withdraw the funds, the interest must be paid. While the language of the statute makes no exception for when the plaintiff prevails on a possession issue, it would seem that fairness would dictate that a possession issue be treated the same as an appeal issue, since the plaintiff’s objection was not wrongful. See Department of Public Works & Buildings v. Schon, 42 Ill.2d 537, 250 N.E.2d 135, 137 (1969) (stating in dicta that predecessor to §20-5-30 applied when plaintiff wrongfully contested petition to withdraw). Note that, unlike interest on an excess award, this interest is payable from the date of deposit, not the date of possession. If the final compensation is less than the preliminary compensation, then interest is paid according to §2-1303, which provides that interest runs from the date of judgment and that interest between the verdict and the judgment is calculated and included in the judgment. There is no right to interest from the date of the withdrawal by the defendant. Department of Transportation v. New Century Engineering & Development Corp., 97 Ill.2d 343, 454 N.E.2d 635, 640 – 641, 73 Ill.Dec. 538 (1983). The obligation to pay interest on the judgment continues during the pendency of an appeal as in any other civil case. Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 157 Ill.2d 282, 626 N.E.2d 213, 220, 193 Ill.Dec. 180 (1993). D. [4.23] Valuation Date Under the Eminent Domain Act, when there is a quick-take proceeding, if the trial commences more than two years after the date of filing the complaint, then the court may move

QUICK-TAKE §4.25


the valuation date to any date between the filing date and the date of the vesting of title. 735 ILCS 30/10-5-60(ii). E. [4.24] Alternatives to Quick-Take An interesting line of cases has arisen in both the federal and state context in relation to the acquisition of easements for pipeline construction. Under both systems, the pipeline companies have condemnation authority granted through a regulatory framework but do not have quick-take authority. Instead, the acquiring entities have used a preliminary injunction process to obtain possession prior to an award and payment of final compensation. In the federal system, once the pipeline company obtains a judgment for condemnation, thereby resolving all issues other than the amount of compensation to be paid, the courts have permitted the pipeline company to take possession of the easement by granting a preliminary injunction for immediate possession of the property. See Rockies Express Pipeline LLC v. 77.620 Acres More or Less, No. 08-3127, 2008 WL 3849911 (C.D.Ill. Aug. 15, 2008) (and cases cited therein); Northern Border Pipeline Co. v. 64.111 Acres of Land, 125 F.Supp.2d 299 (N.D.Ill. 2000). In the state system, the Illinois appellate court applied a similar analysis in Enbridge Pipelines (Illinois), L.L.C. v. Troyer, 2015 IL App (4th) 150334, 38 N.E.3d 1282, 395 Ill.Dec. 526, granting a preliminary injunction for possession of the property prior to the jury determination of just compensation. While the court states that the only remaining issue is the amount of compensation, it is not clear how the case has come to that procedural posture. There is no reference in the opinion to a judgment of condemnation (like in the federal system) or the denial of a traverse. The court refers to its prior Rule 23 opinion affirming the grant of eminent domain under the regulatory framework, but, in the federal system, the mere fact that the plaintiff has cleared the regulatory requirements to acquire the authority to condemn is not enough. See Northern Border Pipeline Co. v. 86.72 Acres of Land, 144 F.3d 469 (7th Cir. 1998). This federal analysis is consistent with the Illinois procedure whereby the condemnation right can be tested through the traverse process. Troyer, supra, makes no mention of the quick-take statute or the process required thereunder. There is no analysis of how the court has authority to circumvent a clear and long-established statutory framework through the exercise of its equitable injunctive powers. It appears that under the analysis of Troyer, entities without quick-take powers may be able to obtain a similar result without following the statutory quick-take process. IX. APPEALS A. [4.25] Appealable Issues The only appealable issues in a quick-take proceeding are the court’s findings that the plaintiff has authority to exercise the right of eminent domain, that the property taken is subject to the exercise of that right, and that the right is not being improperly exercised. 735 ILCS 30/20-5-



10(b). In Department of Transportation ex rel. People v. 151 Interstate Road Corp., 209 Ill.2d 471, 810 N.E.2d 1, 284 Ill.Dec. 348 (2004), the Supreme Court resolved a conflict among the districts, holding that the issue of whether the condemnor negotiated in good faith is directly related to the proper exercise of the right of eminent domain under former 735 ILCS 5/7-104(b) (now 735 ILCS 30/20-5-10(b)) and, therefore, is appealable under S.Ct. Rule 307(a)(7). The issues of the necessity of the quick-take and the amount of preliminary just compensation, however, are interlocutory orders and are not appealable. Department of Public Works & Buildings v. Dust, 19 Ill.2d 217, 166 N.E.2d 36, 38 (1960). The appeal must be taken within 30 days, which may be extended by the court for good cause. Id. In Department of Public Works & Buildings of State of Illinois ex rel. People v. Exchange National Bank of Chicago, 40 Ill.App.3d 623, 356 N.E.2d 376, 380, 1 Ill.Dec. 250 (2d Dist. 1976), the court held that in a proceeding in which a quick-take order had been entered, the defendant could not appeal the issue of authority after the trial on final compensation. B. [4.26] Stay Pending Appeal If the plaintiff appeals, then further proceedings are stayed. 735 ILCS 30/20-5-10(b). If the defendant appeals, then the proceedings are stayed only if the court so orders. Id. Absent a stay, the court may continue the hearing and determine the necessity for quick-take and the amount of preliminary just compensation. Department of Public Works & Buildings v. Dust, 19 Ill.2d 217, 166 N.E.2d 36, 38 (1960). C. [4.27] Dismissal of Complaint on Appeal If the appellate court, on appeal of the quick-take order, finds that the plaintiff did not have the authority to acquire the property by eminent domain, then the trial court shall enter an order revesting title in the appropriate parties. The plaintiff must also pay any damages from its possession and use of the property and shall pay the defendant’s costs, expenses, and attorneys’ fees. 735 ILCS 30/20-5-45. X. SUBSEQUENT PROCEEDINGS A. [4.28] Matters at Quick-Take Not Admissible at Trial Because quick-take “is a proceeding within a proceeding” and clearly expedited and preliminary in nature, in general, neither party is judicially bound by what takes place at the hearing as to evidentiary matters. See Department of Transportation v. Quincy Coach House, Inc., 64 Ill.2d 350, 356 N.E.2d 13, 17, 1 Ill.Dec. 13 (1976), quoting Department of Public Works & Buildings v. Dust, 19 Ill.2d 217, 166 N.E.2d 36, 38 (1960). The amount awarded at the quick-take hearing and the amount deposited cannot be evidence in the hearing to ascertain the final compensation “and shall not be disclosed in any manner to a jury impaneled in the proceedings.” 735 ILCS 30/20-5-10(d). The appraisers’ report ordered under §20-5-10(c) is also not admissible, but the parties may call the appraisers as witnesses. 735 ILCS 30/20-5-10(d). However, an appraiser cannot disclose that he or she was appointed by the court to appraise the property for

QUICK-TAKE §4.30


the quick-take hearing. Department of Business & Economic Development v. Baumann, 56 Ill.2d 382, 308 N.E.2d 580, 582 (1974); Department of Public Works & Buildings of State of Illinois ex rel. People v. First National Bank of Waukegan, 61 Ill.App.2d 78, 209 N.E.2d 21, 23 (2d Dist. 1965). Furthermore, a failure to object to evidence at a quick-take hearing is not a waiver of the right to object to the evidence at the final hearing. Quincy Coach House, supra, 356 N.E.2d at 17. However, whether an appraiser’s testimony at quick-take can be used for purposes of impeachment is untested. The impeachment, if permissible, would have to be conducted without running afoul of the restrictions listed above. B. [4.29] Dismissal or Abandonment by the Plaintiff At any time before the plaintiff takes possession after the vesting of title, the plaintiff may dismiss the complaint and thereby abandon the proceedings. 735 ILCS 30/20-5-40; Department of Public Works & Buildings of State of Illinois ex rel. People v. Vogt, 51 Ill.App.3d 770, 366 N.E.2d 310, 9 Ill.Dec. 53 (5th Dist. 1977). In City of Chicago v. Harris Trust & Savings Bank, 346 Ill.App.3d 609, 804 N.E.2d 724, 281 Ill.Dec. 759 (1st Dist. 2004), the court permitted the condemnor to abandon the proceedings as to the lessee of the property after the order vesting title had been entered when the order provided for delayed possession and the petition to abandon was filed before the possession date in the order vesting title. The court also emphasized that the condemnor had never taken actual possession, even after the possession date allowed in the order, indicating that actual possession, not permitted possession, may be the determining factor. 804 N.E.2d at 732. Upon dismissal, the plaintiff must pay the defendant’s attorneys’ fees and costs. 735 ILCS 30/10-5-70(a). Once the plaintiff has taken possession pursuant to the order vesting title, it cannot dismiss the complaint or abandon the proceedings without the consent of all parties affected and shall pay appropriate damages, attorneys’ fees, and costs. 735 ILCS 30/10-5-70, 30/20-5-40, 30/20-5-45. XI. SAMPLE PLEADINGS AND DOCUMENTS A. [4.30] Sample Motion for Immediate Vesting of Title This motion is prepared as if the condemning authority is the State of Illinois and contains alternative language in the event the current fiscal year program is not yet published by the state. It also attaches relevant portions of the program and requests waiver of service of the entire program book.

MOTION FOR IMMEDIATE VESTING OF TITLE Plaintiff, Department of Transportation, State of Illinois, by [name of plaintiff attorney], Attorney General, for its Motion for Immediate Vesting of Title under 735 ILCS 30/20-5-5 and 30/20-5-10 states: 1. Plaintiff requests that it be immediately vested with [fee simple] title to the following described property:



[Lots ___ and ___ in ____________ Subdivision, ____________] [name of county], Illinois, commonly known as [address]. Property Identification Number: [PIN number] Parcel [parcel number] [2. Plaintiff has adopted a schedule for a project that calls for the acquisition of this and other Parcels of land in [name of county] County and the construction of the proposed improvements in Plaintiff’s ___ fiscal year. The Secretary of the Department of Transportation submitted this schedule to the Governor of the State of Illinois under the laws of the State. The project is contained in the Department’s fiscal year ___ improvement program. The project is included in the Department’s fiscal year ___ appropriation budget and improvement program attached as Exhibit A and entitled “FY ___ Proposed Highway Improvement Program.” Portions of Exhibit A that refer to this Parcel are attached as Exhibit B.]

[or] [2. Plaintiff has adopted a schedule for a project that calls for the acquisition of this and other Parcels of land in [name of county] County and the construction of the proposed improvements in Plaintiff’s ___ fiscal year. The Secretary of the Department of Transportation submitted this schedule to the Governor of the State of Illinois under the laws of the State. The project is contained in the Department’s fiscal year ___ improvement program. The project is included in the Department’s ___-year plan entitled “FY ___ Proposed Highway Improvement Program,” attached as Exhibit A. Portions of Exhibit A that refer to this Parcel are attached as Exhibit B. The Department’s fiscal year ___ appropriation budget and improvement program are not yet available in printed form.] 3. Plaintiff seeks to acquire the Parcel for the following project: [Improvement of FAP Route A.] 4. This Parcel is necessary to complete the project and will specifically be used for [construction of additional lanes]. 5. Plaintiff has been unable to acquire, and has reason to believe it will be unable to acquire, the Parcel by negotiation. 6. Further delay in the acquisition of the Parcel will delay the planned work and improvements, all of which are public works, and will imperil the acquisition and construction schedule of Plaintiff. This, in turn, will cause increased construction costs and [delay the elimination of traffic hazards by the proposed improvements]. PLAINTIFF REQUESTS THAT THIS COURT:

QUICK-TAKE §4.31


a. Set a date for a hearing on this Motion not less than five days after the filing of this Motion. b. Enter an Order at the conclusion of the hearing vesting immediate [fee simple] title to Parcel [parcel number] to Plaintiff. c. Waive service of Exhibit A entitled [“FY ___ – ___ Proposed Highway Improvement Program,”], a copy of Exhibit A having been placed on file with the Clerk of the Court. Department of Transportation State of Illinois By: ____________, Attorney General B. [4.31] Sample Publication Notice This publication notice contains notice of the quick-take hearing.

PUBLICATION NOTICE The requisite Affidavits for Service by Publication having been filed in the above-captioned cause, NOTICE is hereby given to [name of Defendants] and Unknown Owners, Defendants in this cause, that this condemnation action is now pending in the Circuit Court of [name of county] County, against you and other Defendants, praying for the condemnation of certain real estate as follows: [Lots ___ and ___ in ____________ Subdivision,] [name of county] County, Illinois, commonly known as [address]. Property Identification Number: [PIN number] The names of the titleholders of record, other interested parties, and the interest sought are as follows: A. Name or names of present owner or owners of the premises: B. Names of other interested parties: C. Interest sought:[Fee simple]. You are further notified that unless on or before [date], you file or otherwise make your appearance in this suit, a trial may be held and judgment entered against you for the relief asked for in the Complaint.



You are further notified that on [date and time], in Courtroom ___ at the [name of county] County Courthouse, the Plaintiff’s Motion for Immediate Vesting of Title will be heard before Judge [name of judge] or any judge sitting in [his] [her] stead. Dated: [date] _______________________________________ Clerk of the Circuit Court Attorney for Plaintiff: [name of county] County, Illinois [attorney information] C. [4.32] Sample Order Setting Hearing on Motion for Immediate Vesting of Title This order provides additional paragraphs that may be used if the court orders notice to the publication defendants and waives the service of the entire program book or plan.

ORDER SETTING HEARING ON MOTION FOR IMMEDIATE VESTING OF TITLE

This cause heard on Plaintiff’s Motion for Immediate Vesting of Title for Parcel [parcel number], the Court orders: 1. Plaintiff is granted leave to file the Motion instanter. 2. The Motion for Immediate Vesting of Title for Parcel [parcel number] is set for hearing on the [date and time], before Judge [name of judge] or any other judge sitting in [his] [her] stead. 3. Plaintiff shall serve the Motion and this Order on each party to the proceeding whose interests would be affected by the taking requested and whose address is known to Plaintiff in compliance with 735 ILCS 5/1-108, Supreme Court Rule 11, and Local Court Rules. [4. Plaintiff shall give notice by publication to each party whose address is unknown.] [5. Service of Exhibit A to the Motion is waived.] ENTER: _______________________________ _______________________________________ JUDGE

QUICK-TAKE §4.33


D. [4.33] Sample Order Fixing Preliminary Just Compensation

ORDER FIXING PRELIMINARY JUST COMPENSATION This cause heard on Plaintiff’s Motion for Immediate Vesting of Title, with Plaintiff present by its attorney, [name of attorney], the following Defendants appearing: [names of defendants appearing] and the following Defendants not appearing: [Name of County Treasurer] [name of county] County Treasurer, and Unknown Owners. The Court finds that notice was given to all parties as required by the Court in its Order setting this matter for hearing. The Court, having considered the evidence, arguments, pleadings, and other filings of the parties, finds: 1. Plaintiff has authority to exercise the right of eminent domain in these proceedings. 2. The property sought to be taken is subject to Plaintiff’s authority, and the authority is not being improperly exercised. 3. Reasonable necessity exists for the taking of the property in the manner requested. 4. $____________ is the amount constituting preliminary just compensation for the taking of [fee simple] title to: [Lots ___ and ___ in ____________ Subdivision], [name of county], Illinois. Property Identification Number: [PIN number] IT IS ORDERED: A. Upon Plaintiff’s presenting evidence to this court that Plaintiff has deposited the sum of $____________ with the [name of county] County Treasurer in this cause, this Court will enter an Order vesting fee-simple title in Plaintiff to the real estate described in paragraph 4 of this Order [and granting Plaintiff immediate possession]. [B. The construction work on the easement must be completed as specified in the plans prepared by Plaintiff in a good and workmanlike manner and must be paid for by Plaintiff.] [C. Defendant is to remove ____________ by [date]. $____________ of the preliminary just compensation represents the cost to remove ____________, which shall be held by the County Treasurer until Defendant has complied with the condition. If Defendant fails to remove



____________, Plaintiff may, after [date], remove ____________, and funds so withheld shall be returned to Plaintiff.] ENTER: _______________________________ _______________________________________ JUDGE E. [4.34] Sample Treasurer’s Receipt This form should be printed with a court caption so that it may be filed in the court file.

TREASURER’S RECEIPT The undersigned, County Treasurer of [name of county] County, Illinois, acknowledges receipt of [State of Illinois Warrant No. ____________], in the amount of $____________, paid by Plaintiff in this matter as preliminary just compensation due to the owners and parties in interest for the taking of title to Parcel [parcel number] according to the Order Fixing Preliminary Just Compensation entered by the Court on [date]. [date] _______________________________________ County Treasurer of [name of county] County, Illinois F. [4.35] Sample Order Vesting Title

ORDER VESTING TITLE This Court previously ordered on [date], that $____________ was the preliminary compensation to be paid for Plaintiff to acquire [fee simple] title to: Lots [lot numbers] in [name of subdivision] Subdivision, [name of county] County, Illinois. Property Identification Number: [PIN number] The Court finds that Plaintiff has deposited the sum of $____________ with the [name of county] County Treasurer and has filed the Treasurer’s Receipt with the Court. IT IS ORDERED: A. Plaintiff is vested with [fee simple] title to the following described property: [Lots ___ and ___ in ____________ Subdivision], [name of county] County, Illinois.

QUICK-TAKE §4.36


Property Identification Number: [PIN number] [B. Plaintiff is authorized to take immediate possession of this property.] [C. Defendant shall remove ____________ by [date]. $____________ of the above preliminary just compensation represents the cost of removal of ____________, which shall be held by the County Treasurer until Defendant has complied with the condition. If Defendant fails to remove ____________, Plaintiff may, after [date], remove ____________, and the funds so withheld shall be returned to Plaintiff.] ENTER: _______________________________ _______________________________________ JUDGE G. [4.36] Sample Motion To Withdraw Preliminary Just Compensation

MOTION TO WITHDRAW PRELIMINARY JUST COMPENSATION Defendants, [names of defendants], by their attorneys, [name of attorney], request this Court to enter an Order authorizing them to withdraw the sum of $____________, which has been deposited with the [name of county] County Treasurer by Plaintiff pursuant to the Order Fixing Preliminary Just Compensation for the taking of Parcel [parcel number], and state: 1. The complaint for condemnation was filed in this cause on [date], and Defendants are the owners of the land in question and were the owners of the land on the date the complaint was filed. 2. A Motion for Immediate Vesting of Title was filed and heard by the Court, and on [date], the Court entered an Order Fixing Preliminary Just Compensation for the taking of fee-simple title to Parcel [parcel number] in the amount of $____________. 3. Plaintiff has deposited the sum of $____________ with the [name of county] County Treasurer pursuant to the Order of the Court. 4. Plaintiff has taken possession of Parcel [parcel number], an appeal has not been filed, and no appeal will be filed by Defendants. 5. The release of the mortgagee, [name of mortgagee], is attached hereto as Exhibit A. There are no other parties interested in the property other than the [name of county] County Treasurer. Therefore, Defendants are entitled to withdraw the funds without notice to any party other than Plaintiff and the [name of county] County Treasurer.



6. If an Order is entered at a later date requiring a refund of any part of the amount withdrawn as excess compensation, Defendants will refund any amount so ordered. WHEREFORE, Defendants request this Court to enter an order authorizing Defendants to withdraw the sum of $____________ from the [name of county] County Treasurer on the condition that Defendants will refund any excess compensation as ordered by the Court. [name of defendants], Defendants By: ___________________________________ Their Attorneys

Verification I, ____________, under penalty of perjury as provided in 735 ILCS 5/1-109, state that I have read the foregoing Motion, that I know its contents, and that the facts stated therein are true and correct. _______________________________________ H. [4.37] Sample Order Authorizing Withdrawal of Preliminary Just Compensation

ORDER AUTHORIZING WITHDRAWAL OF PRELIMINARY JUST COMPENSATION

On Motion of Defendants, [names of defendants], for Withdrawal of Preliminary Just Compensation, due notice having been given, the Court, being fully advised in the premises, ORDERS: A. The Motion To Withdraw Preliminary Just Compensation is allowed. B. The [name of county] County Treasurer shall issue payment to [name of defendant(s)] in the amount of $____________ after deducting ad valorem taxes. C. This sum shall be held by Defendants, [names of defendants], subject to refund under final Court order if the preliminary just compensation exceeds the final compensation. Enter: _________________________________ _______________________________________ JUDGE


Eminent Domain Proceedings by Government Authorities Other than the State JOHN W. DAMISCH Damisch & Damisch Ltd. Chicago

5



I. [5.1] Introduction II. Preliminary Considerations A. [5.2] Attorneys Should Consider the Overall Project B. Both the Public Body and the Landowner Should Adopt a Plan 1. [5.3] The Condemnor’s Plan 2. [5.4] The Condemnee’s Plan C. [5.5] Tax Consequences D. Should Owners Support or Oppose the Project? 1. [5.6] Condemnation Could Be a Benefit 2. If the Owners Oppose the Project a. [5.7] Start Early b. [5.8] Seek Political and Legislative Support c. [5.9] Oppose the Condemnation at the Pre-Resolution Stage d. [5.10] Should the Condemnor or Condemnees Seek Early Resolution of the

Condemnation Action? III. Issues For Both Sides To Consider in Prosecution or Defense of a Condemnation A. [5.11] A Correct Legal Description B. [5.12] The Eminent Domain Act C. [5.13] A Traverse Could End the Condemnation D. [5.14] The Condemnation Resolution E. [5.15] Failure To Follow the Law Will Lead to Dismissal F. [5.16] Extending the Take Date IV. [5.17] Transferring Property from One Private Owner to Another by

Condemnation A. [5.18] History: Tax Increment Financing, the Tax Increment Allocation

Redevelopment Act, and Redevelopment Authorities B. Challenges 1. [5.19] Elimination of Slums 2. [5.20] Parking for Racetracks 3. [5.21] Municipality’s Change in Plans

EMINENT DOMAIN PROCEEDINGS BY GOVERNMENT AUTHORITIES OTHER THAN THE STATE


V. Other Condemnation Issues A. [5.22] Excessive Taking B. [5.23] Inverse Condemnation 1. [5.24] When Is a Regulation a Taking and Not a Permissible Regulation? 2. [5.25] Downzoning 3. [5.26] Flooding 4. [5.27] Public Body Is the Only Possible Buyer 5. [5.28] Streets and Parkways 6. [5.29] Airports C. [5.30] Mortgage Foreclosures D. [5.31] Condemnation and Interplay Among Public Bodies E. [5.32] Lessees’ Claims to Part of the Award F. [5.33] Home Rule G. [5.34] Abandonment of a Condemnation Action H. [5.35] Notice I. [5.36] Good-Faith Attempt To Settle Before Suit 1. [5.37] What Is the Date of a Taking? 2. [5.38] What Are the Landowners Rights During Pending Condemnation? J. [5.39] Casinos vs. Horse Tracks K. [5.40] Oil Wells L. [5.41] No Money for Bondholders M. [5.42] Interest on Abandoned Property N. [5.43] Billboards O. [5.44] Who Acts for the Condemnor? P. [5.45] Forest Preserves and Easements Q. [5.46] Parking Lots and Driveways VI. [5.47] Conclusion



I. [5.1] INTRODUCTION Counties, cities, municipalities, forest preserves, conservation districts, airport authorities, public building commissions, and a host of other entities from levees to sports authorities have been granted the power of eminent domain. Quasi-public bodies such as public utilities for gas, electric, telephone, pipelines, and the like have also been given the right to take private property by condemnation. The general law of condemnation for all condemning bodies applies in condemnation proceedings and is covered in other chapters of this book. Condemnation actions brought in the federal courts mirror state actions except the condemnee/owner is not entitled to a jury that would set the compensation for the taking of the property. Efforts to enact legislation requiring a jury in federal takings have failed. See Chapter 11 of this handbook, Federal Eminent Domain Practice, for information regarding local public bodies faced with federal takings. There has been little condemnation activity in the eminent domain field in the past decade. Municipalities, sports authorities, and tax increment financing (TIF) districts have not had the funds to develop new projects. Developers are not interested in making investments in TIF district shopping malls. Some shopping malls are in financial difficulties. Attempts have been made to expand condemnation into areas outside the taking of real estate by the use of inverse condemnation. Most inverse condemnation cases fail because there is no actual taking of land for a public use. This chapter deals with some of the special considerations that can arise when the condemnation is brought, not by the State of Illinois or a public utility, but by one of the many other entities that have been granted the right of eminent domain. II. PRELIMINARY CONSIDERATIONS A. [5.2] Attorneys Should Consider the Overall Project Attorneys for the public body and owner should consider the entire condemnation project. Is the project going to increase or decrease the value of the owner’s land? Does the public body have quick-take rights? How soon does the public body need the land? Has the Eminent Domain Act been followed to the letter? The following are some of the issues that both sides should consider. On January 1, 2007, the Eminent Domain Act (EDA), 735 ILCS 30/1-1-1, et seq., became law. This legislation had its greatest impact on the condemnation powers of local governments and particularly municipal governments taking land for tax increment financing districts. Some of the changes in condemnation proceedings brought about by the EDA are discussed in this chapter. Attorneys are cautioned to be careful citing cases that pre-date 2007 if the EDA has modified any issues in the proposed condemnation proceedings. The EDA attempted to level the playing field for owners, particularly in the area of TIF districts. Before the EDA, municipalities formed TIF districts that were in place for over 20 years. Property was subject to a taking during that entire period. The burden was on the landowner to prove that the TIF district was not properly formed or was otherwise defective. The landowner usually lost this battle.

EMINENT DOMAIN PROCEEDINGS BY GOVERNMENT AUTHORITIES OTHER THAN THE STATE §5.3


The EDA shifted the burden of proof to the municipality to show that the TIF district was properly formed for public purposes. Condemnation became more favorable to landowners after the United States Supreme Court’s decision in Kelo v. City of New London, Connecticut, 545 U.S. 469, 162 L.Ed.2d 439, 125 S.Ct. 2655 (2005). That decision brought about the EDA as well as substantial legislative changes in condemnation laws in over 20 states. Kelo brought a strong dissent by Supreme Court Justice Sandra Day O’Connor, followed by her resignation. A postscript to Kelo is that the hotel/shopping TIF project was never completed. Both the public body and the landowner should consider any change in legislation that may affect the prosecution or defense of a condemnation action. B. Both the Public Body and the Landowner Should Adopt a Plan 1. [5.3] The Condemnor’s Plan The condemning body, with the advice of its attorneys, should develop an overall plan for the project and condemnation proceedings. The public body’s plan for a project usually begins years before condemnation. The project often has political, financial, and public acceptance considerations. Financing the project out of bond proceeds, taxes, or user fees may ultimately impact condemnation proceedings. The public body could incur substantial planning, engineering, attorney, appraisal, and trial costs only to find, after a jury verdict, that the public body is unable to fund the acquisition. An abandonment of the project will result in the payment of all the owners’ fees and costs as well as fees and expenses spent by the public body. From the initial concept of the project to the final condemnation judgment, the political and economic climate may have changed. In Oak Brook Park District v. Oak Brook Development Co., 170 Ill.App.3d 221, 524 N.E.2d 213, 120 Ill.Dec. 448 (2d Dist. 1988), the jury award was over $17 million. The park district abandoned the project and paid very substantial attorneys’ fees and costs. Failure to follow the statute to the letter will probably result in the court granting a traverse and dismissing the condemnation action. Such dismissal will also subject the condemning body to the payment of the landowners’ attorneys’ fees and costs. If the appeal is unsuccessful, the condemning body will be required to pay additional fees and costs for the defendant’s appeal. If the condemning body has to start over with a new suit, the financial costs could be devastating. The stricter rules of the Eminent Domain Act could make the acquisition impossible. The valuation date could be advanced. New appraisals, engineering, land planners, etc., would be required to comport with a much later valuation date. All of these expenses (damages) could be laid at the door of the parties (including attorneys) who caused the traverse to be granted. Although political and economic conditions may change for a project, usually the financing of the project is most critical and directly impacts local projects. The question of quick-take usually arises. The public body that is ready to acquire private property has political and public approval, preliminary plans and financing are in place, construction costs have been determined, and the project is ready to move to completion. In those cases, it is important that the private property be acquired immediately so the project proceeds, opportunity and civic efforts are not lost, and the current mayor and board of trustees’ names are forever emblazoned on the bronze tablet that adorns the public improvement. If the public body had the right to quick-take, the



owner’s property may be acquired in less than 30 days after filing of the suit to condemn. The current mayor will have his or her picture in the paper at the ground-breaking ceremony for the new civic center or swimming pool. Quick-take is granted only by the Illinois legislature and is not a home-rule power. The quick-take powers given to non-state entities are usually limited as to time and scope. Municipalities have powerful lobbies in the legislature. Individual owners usually have a single voice. Over years, municipalities have extended their power of eminent domain and quick-take to the extent that nearly every piece of property could be designated as a tax increment financing or development district, condemned, and turned over to a private developer. In spite of the EDA and the backlash of Kelo v. City of New London, Connecticut, 545 U.S. 469, 162 L.Ed.2d 439, 125 S.Ct. 2655 (2005), the elimination of true blight and continual upgrading of homes and cities are important missions of state and local governments. These benefits are set out in Northwestern University professor Carl Smith’s in THE PLAN OF CHICAGO: DANIEL BURNHAM AND THE REMAKING OF THE AMERICAN CITY (2006). This book demonstrates the importance of planning and the constant rebuilding of the great cities of the world. Time will tell whether the EDA is a blessing or a detriment to state and local governments. With the substantial drop in real estate values, and the lack of developers, it is more important than ever to have a plan in place. If the proposed land to be taken is to be used for a park, a school, or a sports authority is the project feasible? Does the population support a new school or park? Will the project be a financial success? Will the bonds financing the project sell and hold their value? These are business, and not legal, decisions. The attorney should only advise, not make the final decision on these matters. NOTE: A lis pendens notice should always be filed by condemnor’s attorney upon the filing of a condemnation case. This gives all future owners, and interested parties notice of the pending taking of the property by the public body. 2. [5.4] The Condemnee’s Plan If the owner expects to have a maximum return for his or her property, the owner should also have a plan. Is there a reasonable probability that the subject land could be annexed and rezoned into a municipality for a higher use? Has the owner taken any steps in securing a land plan, engineering a study, or consulting with municipal officials that might lead to annexation and rezoning? The owner’s attorney should explore with the owner, alternate uses of the property that might result in a higher valuation on the date of the filing of the condemnation. Usually, the owner knows of a threatened condemnation years in advance. It is not sufficient for the owner to have only a dream for the use of the property as was held in Southwestern Illinois Development Authority v. Al-Muhajirum, 348 Ill.App.3d 398, 809 N.E.2d 730, 284 Ill.Dec. 164 (5th Dist. 2004). In Al-Muhajirum, the owner was a mosque. The Muslim community had acquired the land near their mosque with the hope of building the community. The mosque’s real estate appraiser made his appraisal of the subject property based on various land improvements that the mosque “planned to make at some undetermined time in the future.” 809 N.E.2d at 733. The mosque’s appraisal was made based on various buildings the mosque hoped to build, even though ground



had never been broken. At trial, the appraisal testimony was stricken. The mosque had no other appraiser to support its date-of-taking value. The appellate court opined that the value of the mosque’s property might have been worth more but the attempt to set value of the property on some distant future hope or dream was not admissible. Without a viable, legal plan for the property being condemned, the party lacking a plan will not be successful. From the landowner’s prospective, should he or she make an early settlement? The valuation date is an important consideration. In past years, real estate values have continued to rise. When the take date was two or three years ago, the landowner was taking a “hit” on the increase in land values while he or she waited for the case to come to trial. Now, if the case is not tried within two years, the court may (or may not) advance the take date. No appellate court cases have addressed this issue directly under the Eminent Domain Act. In Forest Preserve District of DuPage County v. First National Bank of Franklin Park, 401 Ill.App.3d 966, 930 N.E.2d 477, 341 Ill.Dec. 267 (2d Dist. 2010), there was an eight-year delay between the filing and the trial. The appellate court, in its remand, directed the trial court to address the issue of the date of taking. C. [5.5] Tax Consequences Tax consequences are an important consideration for the landowner. Under Internal Revenue Code §1033, the landowner has two years to “roll over” the condemned property proceeds to “like-kind” property. 26 U.S.C. §1033. The rules for like-kind property have been liberalized. The landowner’s attorney should discuss with the landowner whether the condemnation proceeds should be reinvested in other real estate. Advice from a tax attorney should be considered. The final decisions regarding settlement, reinvestment, the type of reinvestment, the tax consequences of the award, costs of the proceedings, and similar issues are business decisions to be made by the landowner with the advice of his or her attorney. The attorney should be cautious about advising the client to reinvest the proceeds in replacement real estate. The replacement property value may sky rocket or nosedive. The lawyer taking on the role of “investment” advisor could be held responsible for bad investment advice. D. Should Owners Support or Oppose the Project? 1. [5.6] Condemnation Could Be a Benefit In developing the owner’s plan, consideration should be given to whether the owner should oppose, or welcome, the project and condemnation. If the village proposes a sewer and water line through a farmer’s 160-acre farm, the value of the farm may increase tenfold. The farmer might be able to negotiate a free tap-on with no recapture costs if the sewer and water line are being paid for by the developer. See Village of Cary v. Trout Valley Ass’n, 282 Ill.App.3d 165, 667 N.E.2d 1082, 217 Ill.Dec. 689 (2d Dist. 1996) (Cary I) and 297 Ill.App.3d 63, 696 N.E.2d 1154, 231 Ill. Dec. 583 (2d Dist. 1998) (Cary II); Illinois State Toll Highway Authority v. DiBenedetto, 275 Ill.App.3d 400, 655 N.E.2d 1085, 211 Ill.Dec. 702 (1st Dist. 1995). The widening of a street from two to four lanes might put the farm on Main Street. Perhaps the condemning body is the only possible buyer. There are dozens of 100-foot abandoned railroad rights-of-way where salvagers have acquired these rights-of-way, removed and sold the rails, granted pipeline and public utility crossings, and now have only a 100-foot strip of land left that is unbuildable and



still subject to real estate taxes. Condemnation by a park district for a biking/hiking trail would be a windfall to the owner. See Department of Natural Resources of State of Illinois v. Brauer, 339 Ill.App.3d 723, 791 N.E.2d 120, 274 Ill.Dec. 324 (3d Dist. 2003). A valuable corner property fronting on two busy four- or six-lane streets loses its commercial appeal when un-mountable medians are erected on both fronting streets. The owner’s problem of access may be solved when the village condemns the commercial corner for a beautification program and the jury returns with a generous award. 2. If the Owners Oppose the Project a. [5.7] Start Early If the owner wishes to defeat the taking, he or she should start early and use all political prowess that can be mustered both at the local and state levels. At the local level, schools and other taxing bodies may not want their tax base diminished by a public or semipublic body. The public/taxpayers do not want property taken off the tax rolls with the erection of a sports stadium. Neighborhoods may not want the high school or sewer plant built in their neighborhood. Local opposition may kill the project before the village mayor has his or her pet project off the ground. The admonition to start early in an attempt to defeat a condemnation action has been confirmed in Kreutzer v. Illinois Commerce Commission, 404 Ill.App.3d 791, 936 N.E.2d 147, 344 Ill.Dec. 5 (2d Dist. 2010). In that case, the property owners objected before the Illinois Commerce Commission (ICC) to Commonwealth Edison Company (ComEd) building a high line through southern McHenry and northern Kane Counties. The ICC granted ComEd the right to proceed with condemnation for the line. The property owners sought administrative review before the appellate court. The appellate court held that the evidence before the ICC did not demonstrate the need for the amount of property ComEd sought to take by condemnation. If the owners had waited until ComEd filed the condemnation action and then filed a traverse challenging the extent of the taking, the objection would have been too late and the traverse denied. A postscript to Kreutzer: Several condemnation cases were filed and settled, and there were no further appellate decisions. The line was built as planned but on a reduced take. b. [5.8] Seek Political and Legislative Support Quick-take laws were initially enacted so tollways could be built. For many years, highways were the main beneficiaries of quick-take laws. Gradually quick-take was extended to politically charged projects such as sports authorities and the like. After seeing highways and sports authorities granted quick-take, municipalities, transportation authorities, and a host of other public bodies sought and were granted quick-take condemnation rights. Now, quick-take authority is traded among legislators similar to other legislative “horse trading.” Public bodies hire lobbyists to promote their quick-take legislation. Those opposed to the condemnation project should make early contact with their legislators and urge them to actively oppose quick-take for a particular project. The larger the opposition, the less likely quick-take legislation will pass.



However, like every rule, there are exceptions. In Enbridge Pipelines (Illinois) L.L.C. v. Troyer, 2015 IL App (4th) 150334, 38 N.E.3d 1282, 395 Ill.Dec. 526, Enbridge Pipeline had Illinois Commerce Commission condemnation authority over a set “take” line but did not have “quick-take” authority. Only the Illinois legislature, not the ICC, has the power to grant quick-take in condemnation cases. In early 2015, Enbridge sought access to the landowner’s property to commence the installation of the pipeline. The McLean County jury trial for determination of just compensation was set for the fall of 2015. Enbridge wanted to commence construction of the pipeline in the spring and not wait for a fall 2015 trial. Enbridge filed a motion for an injunction and right of access to the landowner’s land and to enjoin the landowner from interfering with the pipeline construction. The trial court granted the injunction, and the landowner appealed. The appellate court affirmed the granting of the injunction and held Enbridge had set forth the necessary factors that support Illinois injunctions. Based on Enbridge, legislatively mandated “quick-take” may not always be required if the public body is able to present to the trial court the necessary factors supporting injunctive relief. Certainly the condemnor should be required to post a bond. If the trial court is going to grant an injunction similar to Enbridge, the attorney for the landowner should insist on preliminary just compensation for the take and damage to the remainder, if any. The landowner’s attorney should be prepared with a written, detailed appraisal complete with a detailed opinion of the value of the property taken and damages to the remainder. The landowner’s attorney should also insist that the injunction order provide that preliminary just compensation be deposited with the county treasurer before the public body enters the landowner’s land and that upon deposit with the county treasurer, the land owner shall have the right to withdraw the funds on deposit with the treasurer. Other language regarding final just compensation would be appropriate in the order of injunction. If Enbridge is to be extended to other condemnation matters, perhaps legislative quick-take will no longer be a “horse trading” feature in the Illinois legislature. c. [5.9] Oppose the Condemnation at the Pre-Resolution Stage If there is no supporting resolution by the condemning body, there will be no condemnation. The condemnation may be opposed at the village or school board meeting stage. If the project is for a public utility or pipeline project, there must be an approval of the right to condemn granted by the Illinois Commerce Commission (or in a federal taking, by the Federal Energy Commission). Kreutzer v. Illinois Commerce Commission, 404 Ill.App.3d 791, 936 N.E.2d 147, 344 Ill.Dec. 5 (2d Dist. 2010), is an example of how the affected owners may seek to limit the route and/or take of a proposed right-of-way and condemnation. The case is also a map of how the objectors may pursue their objections at the early stages before the ICC. The condemning body (whether village, county, forest preserve, or other) must pass the resolution to “get the ball rolling” for condemnation. The condemning public body will have location, size, public purpose, and many other exhibits available for public comment. Often there are public meetings that are held where public comment is invited concerning the route, size, cost, and impact the proposed project may have. The results of these public meetings and the objections are passed on to the regulatory authority that must ultimately pass the condemnation resolution.



Lakehead Pipeline Co. v. Illinois Commerce Commission, 296 Ill.App.3d 942, 696 N.E.2d 345, 231 Ill.Dec. 353 (3d Dist.), appeal denied, 179 Ill.2d 586 (1998), is a good example of how those opposed to a project were able to defeat the right of condemnation. Lakehead sought construction of a pipeline from the Wisconsin state line to the Indiana state line. Those opposed to the pipeline retained counsel and fought the certification of the pipeline for condemnation authority. The ICC hearing officer recommended granting condemnation rights to Lakehead. The ICC, on a divided vote, refused to follow the hearing officer’s recommendation and denied Lakehead the right to condemn, finding that there was no need for a new pipeline for crude oil. Lakehead unsuccessfully appealed the ICC’s ruling that denied it the right of eminent domain. Lakehead built the pipeline by buying a right-of-way from private landowners from Wisconsin to Indiana. In some instances, Lakehead purchased whole farms, installed the pipeline, and resold the farms subject to the pipeline easements. There has been a great demand to turn abandoned railroad rights-of-way into jogging and biking trails. The “rail to trails” programs are anathemas to farmers and the adjacent property owners who do not want to have their privacy and seclusion invaded, while hikers and bikers want the trails expanded. Federal, state, and local money is available for acquisition and improvement of these trails. Forest Preserve District of Kane County v. Estes, 222 Ill.App.3d 167, 583 N.E.2d 640, 164 Ill.Dec. 724 (2d Dist. 1991), demonstrates legislation supported by farmers. In Estes, the forest preserve district sought to link up park land with a bike and hiking trail. Farmers had lobbied for, and secured, passage of legislation that provided that forest preserve districts could not condemn a linear park without the concurrence of the township in which the property was located. See 60 ILCS 1/115-5, et seq. The appellate court affirmed the dismissal of the case, holding that the forest preserve district failed to prove that a long, common, narrow parcel of land along the Fox River was not being acquired to link up a park since the forest preserve district did not have township approval. Libertyville Township was active in securing special legislation for its extensive open lands program. The township had legislation passed giving townships the right to acquire land for open space under the former Township Open Space Act. The township passed a referendum and bond issue to fund the acquisitions. The statutory authority was very narrow. The former Township Open Space Act provided that the total property to be acquired could not be less than 50 acres unless part of the project was already owned by the township. In Town of Libertyville v. Northwest National Bank of Chicago, 188 Ill.App.3d 809, 544 N.E.2d 1151, 136 Ill.Dec. 376 (2d Dist. 1989), the parcel sought to be acquired was only 40 acres. The trial court dismissed the complaint to condemn, which was affirmed on appeal. There is a series of Libertyville Township condemnation cases that strictly follow the statutory powers granted to the township. d. [5.10] Should the Condemnor or Condemnees Seek Early Resolution of the

Condemnation Action? If there are sufficient legal grounds, a traverse may substantially delay the condemnation action. The granting of a traverse, even for some technical omission, may doom the project. If the project crashes due to a technical omission, hopefully the public body’s attorney’s malpractice insurance will be in place.



With the exception of open lands, most public bodies want an early acquisition of land for the project; thus, time is a bargaining point for the landowner. The public body must consider this time element and how it will affect the project. The public body may pay a premium to acquire needed private land quickly. It was reported that the Illinois Sports Authority paid owners a premium to quickly acquire U.S. Cellular Field. By paying the owners the appraised value, it acquired the land for the new ballpark with few condemnation suits and jury trials. Condemnors should consider that often land acquisition is the smallest part of the costs of a major public project. Delay in the project may increase construction and bond costs and the loss of the use of a needed facility. Proposed condemnors and their attorneys should look to the timing of private acquisitions such as the Chicagoland Speedway in Will County. The Indianapolis 500 owners put the over-500-acre Chicago/Joliet racetrack land under contract in about four days. Construction was timely completed, and the racetrack was an immediate success. At the trial level of Department of Natural Resources of State of Illinois v. Brauer, 339 Ill.App.3d 723, 791 N.E.2d 120, 274 Ill.Dec. 324 (3d Dist. 2003), multiple speedway racetrack sales were offered and denied admittance as evidence of comparable sales. The court held that these sales were an “assemblage.” Assemblage sales are inadmissible. Trustess of Schools of Township 37 North Range Number 13 East, Cook County, Illinois v. Chicago City Bank & Trust Co., 126 Ill.App.2d 302, 262 N.E.2d 80 (1st Dist. 1970); People ex rel. Department of Transportation v. Birger, 155 Ill.App.3d. 130, 507 N.E.2d 1321, 107 Ill.Dec. 952 (5th Dist. 1987). (CAVEAT: A chicken farmer with five acres refused to sell his chicken farm to the speedway at any price. This small chicken farm may be seen on the Google map of the racetrack). If the public body has a long-range plan to acquire open space for a forest preserve, conservation districts, or parks and the financing will come from taxes over future years, quick-take and the speed of the acquisition are not priorities. The filing date of the condemnation suit sets the valuation date of the property to be acquired. Filing suit for land in an area of upwardly spiraling market will set the value of the open space at filing date values. The forest preserve district may not be called on to pay for the land for many years until all of the court proceedings, trial, post-trial motions, and possible appeals have concluded. In Forest Preserve District of DuPage County v. West Suburban Bank, 249 Ill.App.3d 900, 621 N.E.2d 215, 190 Ill.Dec. 346 (2d Dist. 1993), rev’d, 161 Ill.2d 448 (1994), suit to condemn was filed January 15, 1988. The matter concluded after the Illinois Supreme Court ruled seven years later. In those seven years, DuPage County land values at North Avenue and Prince Crossing Roads increased substantially, all to the financial benefit of the forest preserve district and the detriment of the owner, Harry W. Kuhn, Inc. The delay in condemnation proceedings and the claimed abuse to owners are issues that the Eminent Domain Act addresses. The valuation date of property condemned is the date of the filing of the suit to condemn. Therefore, in Forest Preserve District of DuPage County, since the property went up in value, the owner was paid compensation based on a value of the land seven years prior. The EDA provides that if the condemnation case does not go to trial within two years of the filing of the suit to condemn, the trial judge, in his or her discretion, may change the valuation date to a date closer to the start of the trial. 735 ILCS 30/10-5-60. Advancing the valuation date may (or may not) increase the value of the property being taken and will cost both the condemnor and condemnee new expenses in appraisal, engineering, land planning, depositions, and the like. The entire spectrum of the land taken may have changed. Comparable sales may be different. Adjoining properties may have been developed. A host of other variables



may have made the subject property more (or less) valuable. This EDA will affect the “green grass” cases in which the public body does not need the property for a forest preserve, park, or even for expected school expansions in the immediate future. A threatened change in valuation date will give condemning bodies greater incentive to seek an early resolution of the condemnation by trial or settlement. III. ISSUES FOR BOTH SIDES TO CONSIDER IN PROSECUTION OR

DEFENSE OF A CONDEMNATION A. [5.11] A Correct Legal Description Often the legal description in a condemnation case is inaccurate. Whether the error is with the surveyor, engineer, land planner, municipal manager, title insurer, or attorney, an inaccurate legal description usually leads to having a traverse granted and condemnation dismissed. It is mandatory that the property be precisely legally described. A survey and current title should be acquired. On the eve of filing the condemnation suit, an update of the title should be ordered to make certain that the proposed condemnee has not conveyed title. The enabling ordinance should set out the exact legal description of the property sought to be acquired, the purpose of the acquisition, the authority of the condemning body and staff, and that attempts should be made to acquire the property by good-faith negotiation, but if negotiations fail, the condemning body’s attorney is directed to commence a condemnation action for the acquisition of the property. It seems fundamental that if the area being condemned is not in the area described for the tax increment financing district, or Illinois Commerce Commission order, it is not subject to condemnation. In Village of Skokie v. Gianoulis, 260 Ill.App.3d 287, 632 N.E.2d 106, 198 Ill.Dec. 47 (1st Dist. 1994), the village brought a condemnation action (under its claimed home rule) to condemn a gasoline station, three vacant lots, and a partially vacant building for redevelopment. The owners filed a traverse, claiming the taking was excessive, unnecessary, and an abuse of discretion. The vacant lots were not included in the described TIF area. The trial court struck the three vacant lots from the taking. The village passed another ordinance including the three lots in the redevelopment area. In the hearing on the traverse, it was brought out that the owners of the gasoline station had sought to renovate their property, and the village denied the renovation attempts. The actions of the village and the statements of its trustees were properly admitted as statements against interest in defeating the village’s condemnation efforts. The trial court granted the traverse in favor of the owners of the gasoline station and the commercial building. The appellate court affirmed the dismissal of the proceedings against the owners, declaring that redevelopment alone by a municipality is not a purpose for taking provided by statute. The court held that the village “clearly abused its power.” 632 N.E.2d at 113. The actions of public bodies in denying owners’ attempts to renovate their property are discussed in the paragraphs below. In City of Marseilles v. Radke, 287 Ill.App.3d 757, 679 N.E.2d 125, 223 Ill.Dec. 181 (3d Dist. 1997), a consent judgment was entered transferring ownership of a rail easement to the city. The



owner then discovered that the rail easement was not within the legal description of the TIF district. The owner sought to vacate the consent judgment, and the trial court denied the vacation. The appellate court reversed, holding that if the rail easement was not within the TIF district, then the trial court had no jurisdiction to enter the consent judgment. The matter was remanded to the trial court to determine whether the rail easement was within the TIF district. Radke should be compared with Kleinschmidt Inc. v. County of Cook, 287 Ill.App.3d 312, 678 N.E.2d 1065, 223 Ill.Dec. 57 (2d Dist. 1997). In 1985, Kleinschmidt Inc. owned land along Lake Cook Road. Cook County sought to improve the road and passed a resolution to condemn the Kleinschmidt property if it could not be acquired by purchase. With condemnation imminent, the owners sold the property to Cook County. Cook County filed for tax exemption for the property, stating that the property had been acquired for road purposes. Instead of building a road, Cook County sold a portion of the property to a private party. The original owners filed a declaratory judgment action claiming that the conveyance to the private party was illegal and sought to have the property reconveyed to the original owners. The trial court held that because the parties had agreed to the amount of compensation and no condemnation action was ever filed, there was no taking, hence, no reconveyance. The appellate court affirmed. QUERY: Would the property have been returned to the owners if they had entered into a consent judgment of condemnation instead of a sale under the threat of condemnation? It is embarrassing to go through an entire condemnation suit and trial only to find that the property condemned had the wrong section number in the legal descriptions, including the complaint, quick-take petition, and vesting order. The attorney’s malpractice carrier also takes a dim view of the attorney not having condemned the right property. The property owner will be joyous that he or she did not lose the property and that the condemning body, its title company, surveyor, or attorney and their malpractice carriers will step forward with a bundle of cash to have the problem go away. City of Chicago v. Boulevard Bank National Ass’n, 293 Ill.App.3d 767, 688 N.E.2d 844, 228 Ill.Dec. 146 (1st Dist. 1997), was a suit for the acquisition of the Oliver Building, which is contiguous to the Oriental Theater on Randolph Street and diagonal from the Richard J. Daley Civic Center. The Oliver Building had been designated to be rehabilitated and not condemned. The Oriental Theater’s stage was too shallow for the musical productions the owners wished to present. It needed the property next door — the Oliver Building — to expand the Oriental’s stage. The city filed suit to condemn the Oliver Building. The Oliver Building’s owners filed a traverse, claiming the Oliver Building was designated in the enabling ordinance to be rehabilitated, not condemned. The trial court denied the traverse. The appellate court held that Chicago need not amend its enabling TIF ordinance before assembling the needed real estate. The appellate court held that the TIF project had not changed to the extent that a new approval process was required to condemn the Oliver Building next door to add to the Oriental Theater stage. However, Illinois State Toll Highway Authority v. DiBenedetto, 275 Ill.App.3d 400, 655 N.E.2d 1085, 211 Ill.Dec. 702 (1st Dist. 1995), held that failure to specifically identify the property being condemned in the enabling ordinance was fatal to the condemnation action. In DiBenedetto, Sears entered into an agreement with the Village of Hoffman Estates calling for an interchange on the Northwest Tollway at Beverly Road near the new Sears headquarters. Hoffman Estates was to acquire needed interchange property in the name of the tollway authority.



The enabling ordinance of Hoffman Estates identified the interchange location but did not specifically identify the property to be acquired with a precise legal description. The tollway authority commenced suit. The tollway authority’s initial enabling resolution authorized acquisition and construction of the interchange on “property . . . at the intersection of Beverly Road and the Northwest Tollway” where the various parcels of property were located. 655 N.E.2d at 1088. The tollway authority passed subsequent resolutions specifically identifying the properties to be condemned. The resolutions setting out the precise legal descriptions were passed before the condemnation suits were filed. The trial court held that the initial enabling resolution generally, and not specifically, identifying the property was insufficient and subsequent efforts to cure the defect and specifically identify the property to be condemned were also insufficient. The appellate court affirmed the granting of the traverse, holding that “when considering whether a resolution or ordinance contains a description of the property, stringent standards will be applied.” 655 N.E.2d at 1090. It is difficult to square Village of Cary v. Trout Valley Ass’n, 282 Ill.App.3d 165, 667 N.E.2d 1082, 217 Ill.Dec. 689 (2d Dist. 1996); DiBenedetto, supra; and Boulevard Bank, supra. In Boulevard Bank, a traverse claiming failure to comply with all the technicalities of condemnation was overruled. In DiBenedetto, there were preliminary agreements and resolutions to acquire a tollway interchange at a particular crossroads. The tollway authority adopted a general resolution that would keep Sears’ headquarters in Illinois. When Hoffman Estates could not acquire the land by negotiation, the tollway authority passed resolutions that specifically identified the property to be condemned. The federal procedures for condemnation are covered in Chapter 11 of this handbook. Federal rules do not require such specificity in identifying proposed condemnation takings. In Guardian Pipeline, L.L.C. v. 529.42 Acres of Land, 210 F.Supp.2d 971 (N.D.Ill. 2002), Judge James B. Moran, Sr. ruled that the legal description of the farm, and not the precise location of the pipeline course through the farm, was sufficient to defeat a motion to dismiss the pleadings for lack of legal specificity. B. [5.12] The Eminent Domain Act The power of condemnation is inherent in the sovereign. The State of Illinois, as the sovereignty, has the power to acquire property for public use by condemnation. This power is set out in the federal and state Constitutions and is implemented by state statute and court decisions. U.S.CONST. amend. V; ILL.CONST. art. 1; §15, 735 ILCS 30/1-1-1, et seq. It is only through the statutory implementation that various political subdivisions or entities acquire the right of the power of condemnation. Failure of the attorney for the condemnor/public body may be devastating to the public body, owner, their respective attorneys, and their attorneys’ malpractice carrier if they have one. Thus, the first step in representing a condemnor (public body) or the condemnee (owner) is a very careful study of the enabling statute granting the public body the right to condemn. The condemning public body is limited to condemning only to the extent, for the purposes, and for the uses provided by statute



C. [5.13] A Traverse Could End the Condemnation A traverse is the method of challenging the condemnor’s right to bring a condemnation action for the taking of private land. Failure of the owner to file a traverse will be deemed a waiver of any objections to the taking. Only by filing a traverse setting forth all the legal objections will those objections be reserved for appeal. It is best to set forth all specific objections. However, see Forest Preserve District of DuPage County v. Miller, 339 Ill.App.3d 244, 789 N.E.2d 916, 273 Ill.Dec. 742 (2d Dist. 2003), in which the forest preserve district condemned a 35-acre parcel near the Schaumburg Flyers’ baseball field. The owner filed a pro se one-sentence traverse that said, “I Jack Miller am filing . . . this traverse/counterclaim formally objecting to the condemnation of my property at 7 N 601 Rodenburg Road Roselle Illinois by the Du Page County Forest Preserve.” 789 N.E.2d at 919. The trial court denied the traverse, tried the case, and entered judgment. The trial court then set aside the judgment and dismissed the case. The trial court was affirmed on appeal. The forest preserve district conceded that the legal description was faulty and had filed an amended complaint with an amended legal description two years after the commencement of the proceedings. The appellate court held that the owners had preserved their right to challenge the condemnation by filing the one-sentence objection in the nature of a traverse. The one-sentence challenge was deemed good even though 735 ILCS 5/2-603(a) provides that a traverse must be a plain and concise statement of the pleader’s cause of action. The appellate court gave the same admonition that is given here, that the condemning body “can exercise the power of eminent domain only when such grant is specifically conferred by legislative enactment, and then only in the manner and by the agency so authorized.” 789 N.E.2d at 924. Rock River Water Reclamation District v. Dimke, 2016 IL App (2d) 150926-U, is a good primer for all condemnation actions to be taken by a local body. In this case, Rock River sought a sanitary sewer easement outside its municipal limits and across a private 29-acre parcel. Rock River had a plan that included engineering and planning the proposed route of the sanitary sewer; estimates of costs of the project; appraisals of the easement rights to be taken; consideration of the needs and requests of the land owner; the determination that Rock River had the authority and the right to condemn the easement even though it was not within the village limits; an enabling ordinance to exercise eminent domain; and the ability to finance the litigation and pay an award of compensation. Rock River is also a good primer on actions that the condemnee/owner should avoid. The condemnee should concentrate on those matters that may be sustained by a court and avoid matters that the owner will surely loose. Dimke made numerous objections that had little legal merit. The lack of “good-faith” settlement negotiations is often a good challenge. In Rock River, it appears that some of the demands were “off the wall.” An appraisal of $650,000 for an underground easement across 29 rural acres is unreasonable. A seven page single-spaced demand letter is highly unusual. Dimke’s property had a septic system, the removal of which was one of Dimke’s demands. Dimke should have sought the right to hook his property up to the sewer line and fill in the septic tank with dirt. A sewer for Dimke’s 29 acres would have increased the value of his real estate. Demands, such as $10,000 credit towards future sewer bills, were not legally possible. Other demands were equally outrageous. When Dimke was approached for a proposed



sewer, Dimke should have welcomed the opportunity to have the sewer brought to his property with the right to hook on and provide a public sanitary sewer to the 29 acres. D. [5.14] The Condemnation Resolution Every condemnation action must be based on a properly enacted enabling resolution. Condemnation by a public body must be based on a resolution by the condemning body calling for the condemnation of specific land. The lawyer for the public body should prepare the condemnation resolution for the public body. That resolution should stand against any future legal objection or traverse by the condemnee. The lawyer must also follow up that the ordinance is legally adopted by the public body. In Forest Preserve District of Cook County v. Chicago Title & Trust Co., 2015 IL App (1st) 131925, 42 N.E.3d 440, 397 Ill.Dec. 525, in 2000, the district filed suit to condemn an owner’s land based on an ordinance allegedly passed by the district’s Board of Commissioners in 1991. The district and owners agreed to a settlement of $1.7 million. An agreed order of settlement was entered on March 6, 2013. It is assumed the owners withdrew the settlement money from the deposit made by the district to the county treasurer. After the settlement had been made, the owners learned that in other litigation — the 1991 resolution of the District to acquire the owners’ (and other owners’) lands — had not actually and formally been adopted. In February 2014, the owners filed a 735 ILCS 5/2-1401 petition to have the agreed order of March 2013 vacated. The owners claimed the district had falsely represented that a valid ordinance authorizing condemnation had been passed when, in fact, the enabling ordinance had not been voted on. The district filed a motion to dismiss the §2-1401 petition claiming that the owners never filed a traverse challenging the district’s right to condemn and that they had agreed (and paid) the $1.7 million settlement. The court granted the district’s motion to dismiss but also granted the owners the right to file an amended petition, which the owners did. The district moved to dismiss the owner’s amended petition. While the motion to dismiss was pending, the appellate court affirmed the granting of a motion to dismiss in Forest Preserve District v. First National Bank of Evergreen Park, 383 Ill.App.3d 1138, 968 N.E.2d 215, 360 Ill.Dec. 136 (1st Dist. 2008), finding that the district could not acquire the property and did not pass the required condemnation ordinance. The district claimed the owners had entered into an agreed order in 2013. The trial court found that since there was no valid resolution of condemnation, the court lacked jurisdiction to enter the “agreed order” of condemnation. The agreed order was vacated. The appellate court affirmed the vacation of the agreed order of $1.7 million. It was modern day video of the public meeting of the district’s board meeting in 1991 that convinced a court in 2015 that no valid ordinance had been passed by the commissioners and, therefore, was not legally adopted. Lawyers are warned that videos are everywhere, including public meetings. Every public body lawyer should consider the fall out of Forest Preserve, supra. It should be assumed that the forest preserve district must start over with a valid resolution of condemnation if the district still needs the condemned land. The take date would be advanced from 2000, when the case was first filed, to a current date. Would the issue of res adjudicata be raised as it was in City of Chicago v. Midland Smelting, 385 Ill.App.3d 945, 896 N.E.2d 364, 324 Ill.Dec. 578 (1st Dist. 2008)? What are the malpractice consequences? When does the statute of limitations run on



possible malpractice? Who had the obligation to confirm that a valid ordinance of condemnation had, or had not, been adopted? The answer to most of these questions is to pay the owner more money and hope the problem will go away. The money may come from the district (and its taxpayer’s), the attorneys’ malpractice carrier (or the attorneys’ personal account if there is no malpractice coverage), and a lower demand by the owner to solve the case and have settlement money now rather than after an expensive trial. In County of St. Clair v. Caseyville Rifle & Pistol Club, Inc., No. 5-09-0100, 2011 WL 10483334 (5th Dist. 2011) (unpublished), the Caseyville Rifle and Pistol Club had a shooting range at, or near, land that was in a flight pattern approach to Scott Air Force Base located in St. Clair County. The United States Air Force opposed the rifle club’s shooting range near the airport’s flight approach. The St. Clair County Board entered into an executive session to discuss “potential litigation.” When the board returned to its regular session, it voted to approve “the recommendation as presented by Council in Executive Session regarding Potential Litigation.” 2011 WL 10483334 at *8. No mention was made of condemnation, a resolution for condemnation, or other action leading up to the filing of the suit to condemn the gun club land. The Rifle Club filed a traverse that was granted by the court and affirmed on appeal. The trial court awarded the Rifle Club $80,000 in attorneys’ fees and costs. The rule of law in condemnation is simple: No resolution, no condemnation and payment to the owner of attorney fees and costs. E. [5.15] Failure To Follow the Law Will Lead to Dismissal The importance of carefully following the enabling statue granting the public body the right to condemn is found in Village of Cary v. Trout Valley Ass’n, 282 Ill.App.3d 165, 667 N.E.2d 1082, 217 Ill.Dec. 689 (2d Dist. 1996) (Cary I) and 297 Ill.App.3d 63, 696 N.E.2d 1154, 231 Ill.Dec. 583 (2d Dist. 1998) (Cary II). The Village of Cary commenced a condemnation action for easements to extend a sewer line adjacent to, but outside, its corporate limits. The sewer line would serve a new subdivision within the village. Trout Valley was in a “no growth” mode and filed a traverse and motion to dismiss contending that the village had not complied with 65 ILCS 5/11-139-1, et seq. This statute provides that the municipal ordinance should set out the estimated cost of the contemplated project, the period of usefulness, and the method of defraying the cost. The statute also provided for publication in the local newspaper of the enabling ordinance within ten days of its enactment. 65 ILCS 5/11-139-6. At the hearing on the traverse, the Village of Cary did not present any evidence that the ordinance had been published, as required by statute, since the developer of the subdivision was paying for the sewer project, including acquisition costs. The estimated costs, length of usefulness of the sewer, and the method of defraying the costs of the project were not included in the ordinance. Cary I, 667 N.E.2d at 1087. The trial court denied Trout Valley’s defense, and the matter proceeded to trial. The jury awarded Trout Valley $50,000 in compensation for the easements, and Trout Valley appealed. The village claimed it need not comply with the statutory provisions relating to costs, sewer life, and publication since the developer was paying all the bills. The appellate court reversed the denial of the traverse, holding that the “statutory language . . . is clear and unambiguous” and that any municipality availing itself of eminent domain must comply with all statutory requirements. Cary I, 667 N.E.2d at 1088. The case was remanded to the trial court for the entry of an order of dismissal.



On remand, Trout Valley sought attorneys’ fees and costs not only for the trial of the case, but for the appeal of Cary I. The trial court awarded Trout Valley $52,988 in fees and costs for the trial but denied Trout Valley any fees and costs for the appeal of Cary I. On appeal (and cross-appeal), the appellate court affirmed the award of $52,988 for the trial fees. The appellate court also remanded the case for the second time with directions to enter judgment of $18,020 for Trout Valley’s fees and costs for the appeal in Cary I. Cary II, 696 N.E.2d at 1159. The appellate court denied Trout Valley fees and costs for the appeal of Cary II. It is not clear in the published opinion why Trout Valley was not awarded fees and costs in the second appeal since the court found that the trial court erred in failing to award fees and costs for the appeal of Cary I and Trout Valley had to take the second appeal. F. [5.16] Extending the Take Date The valuation date of condemnation is the date the condemnation suit is filed. Often the jury trial setting just compensation may be years later. If the value of the condemned property and comparable sales support a new valuation, consideration should be made to have the court set a later take date. This resetting a take date must be made by petition setting forth sufficient grounds for advancing the valuation date. As of this writing, no appellate citations have addressed advancing the take date under the Eminent Domain Act. If there has been a long delay in having a condemnation action being tried, the owner should consider seeking a new updated take date. If the delay has been caused by the owner, such a plea will probably be denied. The owner and public body must consider the costs of new appraisers, land planners, engineers, and depositions. IV. [5.17] TRANSFERRING PROPERTY FROM ONE PRIVATE OWNER TO

ANOTHER BY CONDEMNATION Although there are fewer tax increment financing and redevelopment districts now, some TIF and redevelopment districts are still alive and active. An attorney must be alert that if blight should come to a residential or an industrial zoned use, and the public body seeks to change this zoned district to another use, the public body, with condemnation power, is standing at the ready to serve the public’s wishes and make the change. No man’s or woman’s land is secure from condemnation! A. [5.18] History: Tax Increment Financing, the Tax Increment Allocation

Redevelopment Act, and Redevelopment Authorities Following World War II, there was a shortage of housing for the “Greatest Generation.” Housing authorities were established in many Illinois communities to provide housing for the elderly and low-income families. Private property was condemned and public housing was erected under public housing authorities. During the depression of the 1930s followed by no new construction during World War II, many Illinois cities had become run down and blighted. Cities wanted to tear down blighted and slum areas and redevelop. Illinois adopted the Tax Increment Allocation Redevelopment Act (TIA), 65 ILCS 5/11-74.4-1, et seq. The TIA is a complex statutory scheme for municipalities to establish redevelopment districts called “TIF (tax increment financing) districts.” The TIA provides for the condemnation of properties within a redevelopment area of a TIF district. The redevelopment area must be in an area that is blighted or about to become blighted. Many TIF districts failed due to opposition from schools, libraries,



and other taxing bodies; the complexity of financing the project; and most frequently, the length of time required to acquire the key pieces of the development area by condemnation. Many municipalities hired TIF specialists to put together the boundaries of the redevelopment area and prepared analyses to support the claims that the TIF district qualified as a blighted area and was subject to acquisition by condemnation. Many owners claimed these analyses were flawed and untrue. The TIF specialist usually found enough factors to qualify the redevelopment area for a TIF district even though the area was an upscale, prestigious community. The TIF specialist’s fee depended on the TIF district going forward with a bond issue. The redevelopment area might have been a single parcel of land or an entire area. Redevelopment areas were gerrymandered to take in certain properties and avoid properties where substantial opposition might develop from the owners, other taxing bodies, and taxpayers. The TIF district stays on the tax rolls at its current value while the new hotel or shopping mall is developed. The redeveloped district does not come back onto the tax rolls at its new redeveloped value for many years. The difference in the real estate taxes saved by the developer is used to help finance the new hotel or shopping center. A development authority has similar purposes as a TIF district, covers a larger area, and comes about by specific Illinois legislation. The Southwestern Illinois Development Authority Act (SWIDA), 70 ILCS 520/1, et seq., is an example of such an authority. The stated purpose of SWIDA is to “promote industrial, commercial, residential, service, transportation and recreational activities and facilities, thereby reducing the evils attendant upon unemployment and enhancing the public health, safety, morals, happiness and general welfare of this State.” 70 ILCS 520/2(g). SWIDA was formed to promote development in Madison and Clinton counties in southwestern Illinois near St. Louis. Many TIF districts, SWIDA, and other redevelopment programs have the right to take private property from one private owner and transfer it to another private owner by condemnation. B. Challenges 1. [5.19] Elimination of Slums There have been many constitutional challenges to the state permitting a public body to take by condemnation the private property of one person and transfer the property to a developer so the developer may make a profit. Until the 2007 enactment of the Eminent Domain Act, most tax increment financing districts have been able to survive constitutional challenge. In Southwestern Illinois Development Authority v. Al-Muhajirum, 318 Ill.App.3d 1005, 744 N.E.2d 308, 253 Ill.Dec. 26 (5th Dist. 2001), SWIDA condemned a mosque in order to transfer ownership of the mosque to private investors who sought the land to build a new, multimillion-dollar residential complex. The mosque challenged the trial court’s decision that approved SWIDA’s eminent domain quick-take action and argued that the taking of the mosque property violated both the United States and Illinois Constitutions. The trial court found that the mosque was located in the heart of a blighted area that included unoccupied and unattended slums. The exercise of condemnation powers for the purpose of eliminating slums or blighted property was a proper use for a valid public purpose. The trial court found that the transfer of the mosque



property to the residential developer would bring about the kind of positive change that was contemplated by the legislation, which was to eliminate slums and blight. The trial court denied the mosque’s traverse and motion to dismiss. The mosque was permitted an interlocutory appeal to the appellate court, which affirmed the trial court’s denial of the traverse and motion to dismiss. 2. [5.20] Parking for Racetracks On April 4, 2002, the Illinois Supreme Court rendered an opinion in Southwestern Illinois Development Authority v. National City Environmental, L.L.C., 199 Ill.2d 225, 768 N.E.2d 1, 263 Ill.Dec. 241 (2002). The case is important because of the numerous turns this case has taken from the trial court to the final decision of the Illinois Supreme Court. SWIDA brought a condemnation action to acquire 148.5 acres of land owned by National City Environmental so an automobile racetrack could expand its operations by creating an open parking lot on 148.5 adjacent acres. SWIDA had earlier issued $21.5 million in revenue bonds to finance the construction of the racetrack. The racetrack was an overwhelming success and had brought over 400,000 people to see stock cars zip around the track. These spectators contributed to the erection of hotels, restaurants, and tourism in the St. Clair County area. The large number of racetrack patrons also contributed to horrendous traffic jams. The racetrack requested that SWIDA acquire the 148-acre adjacent National City Environmental property for a parking lot by SWIDA’s power of condemnation. The racetrack agreed to pay all of SWIDA’s expenses and costs, including the compensation for the property. SWIDA proceeded with the condemnation. National City Environmental challenged SWIDA’s right to take private property for a racetrack parking lot. The trial court denied National City Environmental’s traverse, entered a quick-take order in favor of SWIDA, and denied a motion to stay the vesting of title in SWIDA pending appeal. National City Environmental filed an interlocutory appeal. The appellate court reversed the trial court, holding that SWIDA did not have the authority to condemn the property and that the condemnation was for a private use in violation of the constitutional limitation against taking private property except for public purposes. The appellate court held that a private racetrack parking lot was not a public purpose. SWIDA appealed the appellate court’s reversal to the Illinois Supreme Court. Numerous amicus curiae were submitted, including the farm bureau, municipal leagues, counties, cities (including the City of Chicago), and even the Institute for Justice from Washington, D.C. On April 19, 2001, the Supreme Court, in a four-to-three decision, reversed the appellate court and in a lengthy opinion written by Justice Freeman, reinstated SWIDA’s condemnation action to acquire the vacant land for the racetrack’s private parking lot. Southwestern Illinois Development Authority v. National City Environmental, L.L.C., No. 87809, 2001 WL 403340 (Apr. 19, 2001). Justice Miller concurred with the majority as did Justices McMorrow and Fitzgerald. Justices Thomas, Kilbride, and Harrison dissented, with Justice Harrison writing an extensive dissent. After the decision was rendered, but before the decision was final, Justice Miller retired from the Supreme Court and Appellate Court Justice Rita Garman was appointed to fill Miller’s vacancy. After Justice Garman took her seat on the Supreme Court, National City Environmental’s motion for rehearing was granted. Nearly a year later, the Supreme Court withdrew the preliminary opinion of Justice Freeman and with freshman Justice Garman writing the new majority opinion, affirmed the appellate court and held that the taking was for a private,



rather than a public, use and therefore not permissible. The court noted that the racetrack could have built a parking structure rather than expanded ground parking. Justice Freeman, who had originally written the majority opinion in which Justices Fitzgerald and McMorrow joined, now wrote the dissenting opinion. Justice McMorrow stayed on board with Justice Freeman in his dissent. Justice Fitzgerald, who had originally favored the condemnation, now joined Justice Garman’s opinion that the condemnation for a private parking lot was improper. Justices Kilbride, Thomas, and Harrison retained their positions that the condemnation for a private parking lot was improper, thereby making the final decision five to four in favor of National City Environmental, the owner. While SWIDA was wrestling with the issue of taking land from a private owner and handing it over to another private owner for a stock car racetrack that boosted the economy of the entire southwestern Illinois area, the issue of taking private land from one person and delivering it to another under the guise of condemnation was getting national attention. CBS television aired an episode about the issue on 60 Minutes. The Wall Street Journal published an extensive article on the pros and cons of transferring property from one private owner to another by condemnation. Owners deemed it unfair and unconstitutional to take their property and turn it over to a developer for a profitable venture. Municipalities consider single-family/hold-out owners as blocking progress and economic development of an entire community. Like Illinois, other states were facing these issues, including the state of Connecticut. New London, Connecticut, had been a submarine base for the United States Navy. The submarine base closed. The city of New London created a TIF district that included the submarine base together with contiguous land including older single-family homes. The plan was to develop the area into a hotel/office/retail shopping center complex next to a new Pfizer pharmaceutical installation. Kelo v. City of New London, Connecticut, 545 U.S. 469, 162 L.Ed.2d 439, 125 S.Ct. 2655 (2005). The New London project was similar in many respects to Glenview, Illinois’ development of the closed Glenview Naval Air Station of over 1,000 acres. Glenview acquired the air station from the federal government, established a tax increment financing district, developed a long-range development plan, and is in the process of developing an upscale community complete with all municipal services, including a Metra commuter rail station. Fortunately, Glenview did not have to resort to condemnation to flesh out its development. The Eminent Domain Act divides condemnation takings into five different categories with similar requirements for most of the categories and additional burdens on condemning authorities for other categories. The most significant part of the EDA is the shifting of the burden of proof from the owner to the condemning body, particularly in the TIF area. EXAMPLE: a TIF district could be formed and last for over 20 years. The condemnation might be filed 10 years after the formation of the TIF district. If the owner challenged the municipality, claiming that there was no basis for the finding of blight as a foundation for the TIF district, the burden previously was on the owner to show that there was no blight 10 years before the condemnation suit was filed. The analysis of the TIF specialist’s report prepared several years earlier showing that there were vacancies, building violations, and crime in the TIF district was prima facie evidence that there was a blight basis for the creation of the TIF district.



City of Batavia v. Sandberg, 286 Ill.App.3d 991, 677 N.E.2d 1010, 222 Ill.Dec. 476 (2d Dist. 1997), Village of Deerfield v. Chicca, 293 Ill.App.3d 1141, 718 N.E.2d 1092, 241 Ill.Dec. 238 (2d Dist. 1998) (Rule 23), and Village of Wheeling v. Exchange National Bank of Chicago, 213 Ill.App.3d 325, 572 N.E.2d 966, 157 Ill.Dec. 502 (1st Dist. 1991), challenged the finding that there was blight as a basis for the TIF district. Due to the change in the EDA, these cited cases are no longer a basis for defeating a traverse and should not be relied on. The upper hand of the municipality has been changed by the EDA. The condemnor must prove the necessity of the taking and also must prove that (a) the condemnor has a written agreement with the developer to develop the property with a certain plan and give the reasons why the owner’s property is necessary for the development; (b) the condemnation is in accordance with a regional plan established under a county code, municipal code, or local land resource management plan; or (c) the taking is pursuant to a comprehensive plan in accordance with the state statute authorizing condemnation and the use of the property will remain in place in accordance with the plan for 40 years, with the 40-year restriction recorded to run with the land. Attorneys must carefully review the EDA and make many decisions as to the application of the EDA to proposed TIF projects. 3. [5.21] Municipality’s Change in Plans Tax increment financing districts often take many years to assemble as seen in the ten-year delay in Village of Deerfield v. Chicca, 293 Ill.App.3d 1141, 718 N.E.2d 1092, 241 Ill.Dec. 238 (2d Dist. 1998) (Rule 23), set out in §5.20 above. Municipal priorities change, and financing becomes unavailable or extinct. New ideas are developed and attempts are made to change the redevelopment plan for the TIF district. This change was seen in City of Chicago v. Boulevard Bank National Ass’n, 293 Ill.App.3d 767, 688 N.E.2d 844, 228 Ill.Dec. 146 (1st Dist. 1997), when an additional building was added to the plan. In Chicca, supra, legislation was granted for a “comprehensive” plan and not a “redevelopment” plan. Neither the trial nor appellate courts deemed the difference in these cases significant enough to warrant the granting of a traverse in either Boulevard Bank or Chicca. In Henry County Board v. Village of Orion, 278 Ill.App.3d 1058, 663 N.E.2d 1076, 215 Ill.Dec. 562 (3d Dist. 1996), the Village of Orion changed its redevelopment plan and added an industrial park without giving the statutory notice. Other taxing bodies objected and the objections were sustained. The appellate court held that there must be compliance with the notice requirements for a TIF district. The appellate court also upheld the lower court’s finding that the TIF area was not sufficiently blighted, some parcels were not contiguous, and there was insufficient notice of the changes in the TIF plan. If the public body is determined to have a redevelopment plan that includes condemnation, it should follow the enabling statute to the letter, precisely define a purpose that comports with the statute, and establish the necessity and purpose for the creation of the redevelopment plan. If the areas are blighted, or about to be blighted, the public body should have a documented survey made by professionals familiar with TIF districts and determine whether the documented survey of the proposed development area comports with the many legislative requirements in establishing such blighted areas to qualify for redevelopment. Once the TIF district is established, the public body should seek quick-take power from the legislature. If all is in place, the public



body should proceed with acquisition of the redevelopment area by usual acquisition methods, including purchase and condemnation, if necessary, and be prepared at trial to shoulder the burden of proving that the area was in fact blighted, or about to be blighted, at the adoption of the development plan. The United States Seventh Circuit Court of Appeals case, City of Joliet, Illinois v. New West, L.P., No. 15-2183, 2016 WL 3361519 (7th Cir. June 17, 2016), was a taking by the City of Joliet to raze certain old residential buildings and replace them with new buildings in a redevelopment district. The case affirmed an action to condemn two buildings in Joliet to make way for new housing. The action was brought pursuant to the federal Fair Housing Act and other federal statutes. Unlike the pipe line cases in which three commissioners are appointed to take testimony and recommend compensation for pipeline easements, this case was tried on 100 different days over a year and half. The Seventh Circuit Appellate judges suggested that the district court should have empaneled a jury to try the issues and set fair compensation for the taking. The issues set out in Joliet are similar to the TIF cases of which there are few. The impaneling a federal jury is contrary to jury demands in federal pipeline cases. Guardian Pipeline, LLC v. 529.42 Acres of Land, 210 F.Supp.2d 971 (N.D.Ill. 2002). In City of Chicago v. Eychaner, 2015 IL App (1st) 131833, 26 N.E.3d 501, 389 Ill.Dec. 411, the defendant, Eychaner, owned real estate that was zoned manufacturing. The City of Chicago, under the Tax Increment Allocation Redevelopment Act, brought condemnation under its redevelopment plan to take Eychaner’s land and transfer it to Blommer Chocolate Company. Eychaner filed a traverse challenging the taking as unconstitutional. The trial court denied the traverse, and the appellate court affirmed the denial of the traverse. However, the appellate court (with Justice Hyman writing the opinion) found there was error in denying testimony on the reasonable probability of rezoning the subject property to a higher use. The constitutional issues claimed by the owners were denied by the trial court, and this denial was affirmed. The case was remanded for a new trial on the issue of just compensation with the probability of rezoning now being admitted in evidence. In Village of East Dundee v. Village of Carpentersville, 2016 IL App (2d) 151084, Walmart sought to move its store from a shopping center in East Dundee to a new Walmart Supercenter in Carpentersville. Carpentersville had created a TIF district near this East Dundee border. East Dundee filed a declaratory judgment action against Carpentersville claiming Carpentersville had failed to meet certain provisions of the TIA (65 ILCS 5/11-74.4-3(q)(13)). East Dundee sought a prohibition, injunction, and mandamus preventing the Walmart store’s move. At the outset of the case, East Dundee sought a substitution of judges that the trial court (Judge Akemann) denied. The appellate decision does not address the TIF issues and only reversed the denial of East Dundee’s request for substitution of judges. The underlying issue that was not addressed was East Dundee’s loss of sales tax revenues and real property tax receipts. The case was remanded to the Circuit Court of Kane County to substitute judges and continue with the case.



V. OTHER CONDEMNATION ISSUES A. [5.22] Excessive Taking The claim by owners that the public body is taking more land than the public body needs usually falls on deaf ears. Public bodies have the power to determine their future needs for parks, schools, sports authorities, and other projects. Kreutzer v. Illinois Commerce Commission, 404 Ill.App.3d 791, 936 N.E.2d 147, 344 Ill.Dec. 5 (2d Dist. 2010) (court held Commonwealth Edison Company’s taking was excessive). In Village of Woodridge v. Board of Education of Community High School District 99, 403 Ill.App.3d 559, 933 N.E.2d 392, 342 Ill.Dec. 806 (2d Dist. 2010), the village filed a condemnation action against the school district. The school district filed a traverse that was denied. The school district appealed. The appellate court affirmed the denial of the traverse, holding that the school district’s holding of land for a future, and not an existing, use would not preclude condemnation. The court further held that the school district’s holding of land for “investment purposes” was not an existing use that would preclude condemnation. 933 N.E.2d at 409 – 410. The ruling in this case is contrary to school’s and park district’s past actions in acquiring land for the future based on anticipated population growth. In City of Chicago v. Midland Smelting Co., 385 Ill.App 3d 945, 896 N.E.2d 364, 324 Ill.Dec. 578 (1st Dist. 2008), the City of Chicago filed a suit to condemn Midland’s land, and landowner sought to dismiss the condemnation on the basis of an excessive taking. There had been a previous condemnation of a neighboring property that had caused a loss of parking. The Midland taking was to replace the neighbor’s lost parking. A traverse was granted in the first case filed, holding that there had been an excessive taking. The city then filed a second condemnation seeking to take only one-half of the land sought to the original suit. Midland filed a traverse claiming the second action was barred by the doctrine of res adjudicata. The trial court certified two questions to be answered by the appellate court: (1) whether the judgment in the original condemnation action bars the present action under the doctrine of res judicata; and (2) whether the city’s proposed taking of Midland’s property is a proper exercise of the city’s power of eminent domain. The appellate court, in a lengthy opinion, determined that res adjudicata did not bar the second action. The first action was found to have been an “excessive taking.” It is inferred that if the city took the proper amount of land in the second action for its redevelopment program, this take would be legal. This opinion points out that each case depends on the facts and circumstances that exist at the time of the taking. Facts may change from the first action to a subsequent taking. A lawyer faced with the problem of an excessive taking (or some other deficiency in a condemnation) should pick himself or herself up from the loss, dust off the file, find additional facts that support the taking, and file another condemnation for part, or perhaps all, of the same property based on the new supporting facts and circumstances. After answering the first question that there was no bar to the new action based on res adjudicate, the court answered the second question that the city was properly exercising its power of eminent domain. In planning a condemnation action, the public body is limited to taking only the land needed for the proposed project. If the taking is excessive, the trial court, on the filing a traverse by the



owner, will grant the traverse, dismiss the action, and assess fees and costs of the condemnation against the public body. It is important that the public body’s lawyer have sufficient facts to support the size of the proposed taking. This may call for affidavits from engineers, land planners, and other experts to support the size of the taking. The lawyer for the public body should consider whether the proposed taking is excessive and, if it is, file an amended petition reducing the size of the take to an area that will pass “muster” against any claim that the taking is excessive. The trial court might not permit the filing of an amended complaint changing the size of the take. If the trial court grants the owners traverse and finds the taking excessive, the public body’s lawyer must make a decision of what steps should be taken at that point. The lawyer may ask the trial judge to include in the order granting the traverse, Supreme Court Rule 304(a) language that the order is a final appealable and no just reason that order is enforceable may be appealed. The public body’s lawyer may also consider, upon a claim that the taking is excessive, to voluntarily dismiss the condemnation action and file a new suit with a reduced size of the take. Midland Smelting’s hold that a claim of res adjudicate against a second reduced size suit will be denied. If a traverse is granted due to an excessive taking, the attorney for the condemning body must consider several options. An amended complaint might be filed with more supporting facts and circumstances for filing suit for the same or smaller amount of land, or the attorney may decide to file a new action with supporting facts and a smaller take. In either case, if the condemning body dismisses or reduces the size of the take, the landowner will probably claim an abandonment of the property not taken and seek attorneys’ fees and costs for the successful traverse. These fees and costs might consist of appraisers, land planners, surveyors, engineers, depositions and, of course, attorneys’ fees. Inadequate available public sewer and water are often factual grounds for (1) reduction in fair market value of the subject property, or (2) a claim that the proposed take is too large to be adequately served by existing sewer and water. Other lack of public services might be added to support a claim of excessive taking. Changing facts and circumstances are the foundation for admission or denial of a traverse claiming excessive taking. B. [5.23] Inverse Condemnation Inversion condemnation is when the property owner brings a mandamus, or injunctive, action against a public body seeking to have the public body file a condemnation for the taking of the owner’s land. The mandamus action seeks a court order directing the public body to file a condemnation against the owner. The injunction will seek to restrain the public body from causing damage to the owner’s property. Both actions seek a monetary award from the public body. The owner claims the public body is taking the owner’s land without compensating the owner for the taking pursuant to the federal and state constitutions. Most inversion condemnation actions have been unsuccessful for many reasons. 1. [5.24] When Is a Regulation a Taking and Not a Permissible Regulation? Many local governments have been prone to thwart development by putting roadblocks in front of property owners. These hurdles take many forms, including changes in zoning, moratoriums on building; numerous appearances before a host of planning, zoning, and architectural commissions; and just plain sitting on applications for building permits and



inspections. Government bodies who have engaged in these activities have had their actions approved by the Illinois and United States Supreme Court as discussed below. Owners claim that such activity is a taking of their property in derogation of the Fifth Amendment of the United States Constitution and most state constitutions, including that of Illinois. This claimed taking is often challenged by the owners filing an inverse condemnation action against the public body that is charged with the wrongful taking. The United States Supreme Court has held that each set of facts must stand on its own. Tahoe-Sierra Preservation Council, Inc. v. Tahoe Regional Planning Agency, 216 F.3d 764 (9th Cir. 2000), aff’d, 122 S.Ct. 1465 (2002). In Tahoe-Sierra, the owners owned lots around Lake Tahoe on the California/Nevada line with the intent of building homes on hillside lots that sloped down to the lake. The municipal newly formed planning agency imposed a moratorium on building on the lots for fear that water runoff from the homes would pollute Lake Tahoe. When the moratorium was about to be lifted, environmentalists filed suit to freeze further development. The landowners filed suit in federal court, claiming that their properties were being taken for public use without just compensation in violation of the Fifth Amendment of the United States Constitution. The federal trial judge held that the original three-year moratorium was a taking that entitled the property owners to compensation. The Tahoe Planning Agency (the public body) appealed. The court of appeals reversed, holding that the three-year delay was not a taking since the property owners had not been deprived of all of the use of their property. The court of appeals found the moratorium in the use of the land was only a small fraction of the total useful life of the Tahoe properties. The United States Supreme Court in a six-to-three decision affirmed the court of appeals. The Supreme Court did not go as far as the court of appeals, holding instead that lower courts should consider the facts of each case when evaluating whether there has been a taking. Lawyers and trial courts are left to determine when the local government steps over the line of taking in its use of red tape. Some local governments stall and delay planning and zoning meetings, hold up the issuance of building permits, require multiple revisions and submissions of plans, and enact development moratoriums similar to Lake Tahoe’s. Even though considered unfair by owners, such a delay is not a taking, and developers may see more government intervention with development that does not fit the local governments’ plans. Zeitz v. Village of Glenview, 277 Ill.App.3d 891, 592 N.E.2d 384, 169 Ill.Dec. 897 (1st Dist. 1992) (discussed in §5.25 below). 2. [5.25] Downzoning The changing of a zoning classification or “downzoning” has not been considered a taking. Zeitz v. Village of Glenview, 277 Ill.App.3d 891, 592 N.E.2d 384, 169 Ill.Dec. 897 (1st Dist. 1992). The downzoning in Zeitz was upheld against the owner. In LaSalle National Bank Ass’n v. City of Oakbrook Terrace, 393 Ill.App.3d 905, 913 N.E.2d 130, 332 Ill.Dec. 535 (2d Dist. 2009), the beneficial land trust owners brought suit against the municipality claiming downzoning and an attempt to restrict billboard use was a taking. The owners had not exhausted their remedies with the city before filing suit. The trial court dismissed the complaint, holding that the owner must make a showing that the municipality had gone “too far” in attempting to take the claimant’s interest in land. 913 N.E.2d at 136. The appellate court affirmed the dismissal.



If a claim of taking by a municipality is to be made, the attorney for the owner should take all reasonable steps to attempt to resolve the dispute before seeking inverse condemnation. Objections must be raised to the issuance of citations, attendance, and written objections to downzoning hearings. Even under Zeitz, inverse condemnation actions probably will not preempt downzoning ordinances. In Cribben v. City of Chicago, 384 Ill.App.3d 878, 893 N.E.2d 1016, 323 Ill.Dec. 542 (1st Dist. 2008), the landowners expended funds developing a parcel of property based on existing zoning. The city downzoned the property. The trial court held that the landowners relied on the existing zoning in the development of the property and ruled in the landowners’ favor. The appellate court affirmed the win. It is difficult to square Cribben with Zeitz. Any downzoning will result in a claim of an unconstitutional inverse condemnation taking. Actions for violations of the owner’s civil rights under 42 U.S.C. §1983 are joined in inverse condemnation actions against the public body. Section 1983 authorizes a party who has been deprived of a federal right under the color of state law to seek relief through “an action at law, suit in equity, or other proper proceeding for redress.” These actions are for injunctive relief as well as damages. In Del Monte Dunes at Monterey, Ltd. v. City of Monterey, 95 F.3d 1422 (9th Cir. 1996), aff’d, 119 S.Ct. 1624 (1999), the developer, Del Monte Dunes, sought to develop land within the City of Monterey, California. The city, in a series of repeated rejections, denied proposals to develop the property. At each rejection the city imposed more rigorous demands on the developers until Del Monte Dunes filed suit in federal court under §1983. The case went to trial and resulted in a jury award in favor of Del Monte Dunes. The Ninth Circuit Court of Appeals affirmed the judgment, and the United States Supreme Court affirmed the award of damages. The city claimed that its land use decisions were immune from judicial scrutiny. The courts rejected this argument. The court drew similarities between a civil rights action under §1983 against a public body and inverse condemnation. The Del Monte property was 37.6 acres of Pacific Ocean frontage that had been an abandoned oil tank farm terminal. Trash, broken concrete, pieces of pipe, and oil-soaked sand covered the property. In 1981, the landowners submitted an application to clean up and develop the property in conformance with the city’s zoning and general plan requirements. Although the city zoning would permit 1,000 housing units on the site, the owners’ proposal was limited to 344 units. In 1982, the plan commission denied the application but suggested 264 units might be acceptable. The owners submitted a 264-unit plan. In 1983, the plan commission denied the plan but indicated that 224 units might pass. The landowners submitted a 224-unit plan for the site, and, in 1984, the 224-unit plan was denied. They owners went to the city council, which referred the matter back to the plan commission with instructions to consider 190 units. The owners came back with a 190-unit plan that was rejected by the plan commission. Appeal was made to the city council, which approved the 190-unit plan subject to a long list of conditions, including 17.9 acres devoted to public open space, a public beach and public access thereto, preservation of certain plants, buffer areas so the buildings could not be seen from the highway, and many other requirements.



Del Monte Dunes met most of the conditions imposed, and the plan commission again rejected the plan. Suit followed. The federal district court dismissed the claims as unripe on the grounds that Del Monte Dunes had not exhausted its review process. The court of appeals affirmed. The Supreme Court accepted the case and, with Justice Kennedy writing the decision, affirmed the dismissal. City of Monterey v. Del Monte Dunes at Monterey, Ltd., 526 U.S. 687, 143 L.Ed.2d 882, 119 S.Ct. 1624 (1999). In Palazzolo v. Rhode Island, 533 U.S. 606, 150 L.Ed.2d 592, 121 S.Ct. 2448 (2001), the landowners brought an inverse condemnation action against the State of Rhode Island, claiming the state was taking the owners’ land without paying just compensation in violation of the owners’ constitutional rights. The owners sought $3.5 million in damages for the claimed taking. The owners owned 20 acres on the Atlantic Ocean coast of Rhode Island. In 1971, Rhode Island established the Rhode Island Coastal Resources Management Council, granting the council power to protect the coastal wetlands. With the establishment of the council, the development of coastal areas, salt marshes, and wetlands along the Atlantic coast was severely limited. The owners petitioned the council to install a wooden bulkhead at the sea and fill the entire marsh area. The council rejected the request. The owners filed a new application with the council to fill 11 of the property’s 18 acres of wetlands in order to build a beach club. The council denied this application as well, and the owners filed the inverse condemnation suit, claiming that the council’s actions and the state’s wetlands regulations had taken the property without compensation in violation of the Fifth and Fourteenth Amendments of the United States Constitution. The owners claimed that the council’s actions were a total taking of the land requiring compensation under Lucas v. South Carolina Coastal Council, 505 U.S. 1003, 120 L.Ed.2d 798, 112 S.Ct. 2886 (1992). Rhode Island’s trial and Supreme Courts ruled against the owners, and the United States Supreme Court granted certiorari. Rhode Island claimed that there was not a total taking since there was a small portion of the 20 acres that was upland property, not in the wetlands, and buildable. The owners did not dispute that a portion of the property was buildable uplands, but they claimed for the first time that the upland portion of the property was separate from the wetland marsh. The Supreme Court remanded the case to the lower court to determine whether there was a total taking, citing Penn Central Transportation Co. v. City of New York, 438 U.S. 104, 57 L.Ed.2d 631, 98 S.Ct. 2646, 2659 (1978), which held that when “a regulation places limitations on land that fall short of eliminating all economically beneficial use, a taking nonetheless may have occurred, depending on a complex [set] of factors including the regulation’s . . . investment-backed expectations, and the character of the government action.” Palazzolo, supra, 121 S.Ct. at 2457. The inquiry then focuses on whether the regulation was a total taking of the land. In Amoco Oil Co. v. Village of Schaumburg, 277 Ill.App.3d 926, 661 N.E.2d 380, 214 Ill.Dec. 526 (1st Dist. 1995), Amoco filed suit for declaratory judgment, injunction, and damages against the village. The village had issued a permit for Amoco to redevelop its service station and then revoked the permit. The village and the Illinois Department of Transportation had entered into an agreement for the widening of the roads at the intersection location of the Amoco station. Amoco sought to improve the property by razing the old station and replacing it with a modern station and mini-mart. As a condition for Amoco’s redevelopment, the village required a dedication of 1,600 square feet of Amoco’s land at the corner of the intersection. The trial court ruled against Amoco, holding that the village had not physically invaded Amoco’s property and that the required dedication of the 1,600 square feet did not constitute a compensable taking. The



appellate court reversed the trial court, holding that the dedication requirement imposed by the village on Amoco constituted a taking. In Zeitz, supra, the owner, Zeitz, filed an action for declaratory judgment, injunction, and inverse condemnation against Glenview claiming that the zoning ordinances of Glenview were a wrongful taking of Zeitz’s land. Zeitz presented a plan to Glenview to build 10 homes on 10 acres of land near an 82-acre national historic landmark known as “The Grove.” The 10-home development plan was not acted on, and Glenview adopted a moratorium on subdivision applications and approvals. Glenview then rezoned the Zeitz property, reducing the number of buildable lots from 10 to 5. The trial court dismissed the case on Glenview’s motion. The appellate court reversed and remanded the case for trial. After full hearing from land planners, appraisers, owners, and village officials, the court again entered judgment for Glenview. The appellate court affirmed the judgment, holding that Zeitz failed to prove that the change in the zoning ordinance reducing the number of buildable sites from 10 to 5 deprived Zeitz of all economically viable uses of the property. Rezoning, moratoriums on development, and delay of plan commission hearings are not the only ways of thwarting land use and possibly incurring a civil rights and inverse condemnation action against the public body. Limiting the hours a business may operate is another control of the use of real property by the public body. In Byron Dragway, Inc. v. County of Ogle, 326 Ill.App.3d 70, 759 N.E.2d 595, 259 Ill.Dec. 815 (2d Dist. 2001), Byron Dragway operated a commercial drag strip in Ogle County. The drag strip raced cars on Friday and Saturday nights until about midnight, and all day Sunday, Memorial Day, and Labor Day until 9:00 p.m. Byron Dragway had spent hundreds of thousands of dollars constructing the racetrack and attracting drag strip competitors and spectators to the track. The track competed with drag strips throughout the Midwest and attracted national competitors and spectators. Ogle County passed an ordinance eliminating auto racing on Fridays and reducing the closing time on Saturday, Sunday, Memorial Day, and Labor Day from midnight and 9:00 p.m. to 6:00 p.m. Byron Dragway filed a suit for declaratory judgment, asserting that the ordinance reducing the days and hours the drag strip could be open for racing resulted in a taking of Byron Dragway’s property without just compensation in violation of the state and federal Constitutions. Byron Dragway claimed with the elimination of Friday and evening hours, the drag strip would no longer be competitive with other drag strips. Races would be canceled, thereby substantially reducing Byron Dragway’s income and permanently damaging Byron Dragway’s national reputation as a racetrack. The trial judge of Ogle County dismissed the complaint, and Byron Dragway appealed. The appellate court held that the racetrack could be regulated, but if the regulation went too far, the regulation would be declared a taking for inverse condemnation purposes. Since the case had been dismissed on motion, there had been no factual findings about whether the regulation went too far. The appellate court remanded the case to the trial court for factual determinations regarding whether the regulation of the hours of the drag strip went too far and became a taking as an inverse condemnation of Byron Dragway’s property.



Byron Dragway quoted liberally from several United States Supreme Court cases. The appellate court stated that “[a] land use regulation does not result in a taking if it substantially advances legitimate governmental interests and does not deny an owner an economically viable use of its land.” 759 N.E.2d at 599, citing Nollan v. California Coastal Commission, 483 U.S. 825, 97 L.Ed.2d 677, 107 S.Ct. 3141, 3147 (1987). Although property may be regulated to a certain extent, if the regulation “goes too far,” it will be recognized as a taking. Lucas, supra, 112 S.Ct. at 2893, quoting Pennsylvania Coal Co. v. Mahon, 260 U.S. 393, 67 L.Ed. 322, 43 S.Ct. 158, 160 (1922). No set formula determines when a regulation goes too far. 112 S.Ct. at 2893. In City of Oakbrook Terrace v. Suburban Bank & Trust Co., 364 Ill.App.3d 506, 845 N.E.2d 1000, 301 Ill.Dec. 135 (2d Dist. 2006), Oakbrook Terrace passed an ordinance eliminating billboards. The city gave the billboard owners nearly 10 years to amortize and remove the signs and did not seek enforcement of removal for another 10 years. After nearly 20 years, the city started enforcement action to remove the signs, and the billboard owners countered claiming that the enforcement was a taking without just compensation. The trial and appellate courts held that the enforcement of the ordinance was a taking that required the award of just compensation even though the ordinance gave the sign board owners a nearly 20-year reprieve from sign elimination. Since there is no magic formula showing when a regulation goes too far and creates an inverse condemnation situation, it is important that attorneys for public bodies, businesses, and property owners affected by regulations be fully prepared to support or challenge proposed regulation. 3. [5.26] Flooding An attorney faced with a flooding case must consider the recent Illinois Supreme Court case Hampton v. Metropolitan Water Reclamation District of Greater Chicago, 2016 IL 119861. This case could be a candidate for certiorari to the United States Supreme Court. In Hampton, the plaintiffs filed suit seeking inverse condemnation against the Metropolitan Water Reclamation District (MWRD) for flooding their land. The Hamptons claimed MWRD caused flooding of their property by using certain flood relief mechanisms to keep other parts of the city from flooding. The Hamptons brought a class action on behalf of property owners in the western suburbs of Chicago claiming MWRD closed certain dams and floodgates on the DesPlaines River, locks to Lake Michigan, and other water level controls. It was claimed that some of the MWRD actions were taken so O’Hare International Airport would not flood. The MWRD moved to dismiss the complaint based on People ex rel. Pratt v. Rosenfield, 399 Ill. 247, 77 N.E.2d 697 (1948). MWRD claimed that based on Pratt, temporary flooding can never constitute a taking under the Illinois Constitution. However, based on Arkansas Game & Fish Commission v. United States, ___ U.S. ___, 184 L.Ed.2d 417, 133 S.Ct. 511 (2012), temporary flooding might be compensable under the United States Constitution. The question then was whether Arkansas Game & Fish overrules Pratt. The trial court dismissed Hampton, and the Illinois Appellate Court affirmed the dismissal. The Illinois Supreme Court granted leave to appeal. The case examines the difference between the United States and Illinois Constitutions as it relates to compensation for taking and compensation for damages in the event of flooding that is temporary. The Hampton Supreme Court decision reversed the trial and appellate courts and remanded the case back to the trial court to grant the plaintiffs leave to amend their taking clause claim. The



trial court was directed to consider the entirety of the plaintiffs’ claim in light of the Supreme Court opinion, which held that the trial court must consider whether there was a taking by the closing of certain locks and dams. The factors that the trial court must consider “include the time and duration of the flooding, whether the invasion of the property was intentional or whether it was a foreseeable result of an authorized government action, and the character of the land and the owner’s reasonable investment-backed expectations regarding the land’s use.” Arkansas Game & Fish, supra, 133 S.Ct. at 522 – 523. The Hampton court noted that the complaint alleged only one instance of flooding and queried whether the flooding was recurring and/or the water remained on their properties for a prolonged period of time. It also noted that the complaint did not allege whether damages caused by the flooding could be repaired. All of the suggested allegations that the Supreme Court set out for a possible amended complaint by the Hamptons are not set out in this chapter; however, these allegations should be considered by a lawyer seeking a flooding taking or damages when there is no actual taking of real estate. These factors should be considered in the defense of flooding claims. Because of the great impact that Hampton may have on public bodies that control locks and dams on Illinois rivers, legislation is inevitable. Attorneys representing or defending flooding issues must carefully follow any legislative actions. Hampton appears to be contrary to Sorrells v. City of Macomb, 2015 IL App (3d) 140763, 44 N.E.3d 453, 398 Ill.Dec. 424, which held that generally flooding does not lend itself to inverse condemnation by the property owner against a municipality or public body. In Sorrells, the property owners claimed the abutting property owner was developing its land and the development activities were causing an unnatural flow of water onto their land. Sorrells added the City of Macomb as an additional defendant claiming the city permitted the development of the abutting residential complex that caused the flooding. Sorrells sought inverse condemnation against the city claiming the city failed to follow applicable drainage and engineering standards in approving the abutting development. The trial court dismissed Sorrells’ inverse condemnation complaint, and the appellate court affirmed the dismissal citing Arkansas Game & Fish as one basis for its decision. Public bodies open and close flood control structures regularly when there is a heavy rain. Opening and closing flood control gates will relieve flood waters in one part of an area but cause flooding in another part of the community. If the opening and closing of flood control gates is a basis for inverse condemnation, perhaps the law of Illinois will have permanently changed and inverse condemnation for flooding will be permitted. Because of the U.S. Supreme Court’s decision in Hampton, Arkansas Game & Fish could be modified or overturned. If Arkansas Game & Fish is changed, there might be substantial inverse condemnation cases from the flooding of crop land from dams and locks on the Mississippi River and other streams and rivers. The Wilmette lock is frequently opened during heavy rain storms permitting water to flow into Lake Michigan. Locks and dams on other Illinois rivers are open and closed causing regular flooding up or down stream from the lock or dam. Attorneys are advised to keep abreast of this possible changing landscape of inverse condemnation in this area.



4. [5.27] Public Body Is the Only Possible Buyer Sometimes the landowner seeks to have the public body take their land provided the owner is compensated for the taking. It is usually the price demanded by the owner that shies away the public body from taking. That is what was played out in Stahelin v. Forest Preserve District of DuPage County, 376 Ill.App.3d 765, 877 N.E.2d 1121, 315 Ill.Dec. 792 (2d Dist. 2007). Stahelin’s 18 acres of land was bordered on three sides by the Morton Arboretum. The Morton Arboretum is a large semipublic forested area in mid-DuPage County. It is devoted to the study and preservation of forests and trees. It was founded as a charitable foundation by the Morton family known for Morton’s Salt. Morton wished to add the Stahelin land to their arboretum and entered into an agreement with the forest preserve district that the district condemn the land and make it available as open lands and forest for the arboretum. The forest preserve district filed a condemnation against Stahelin to acquire the land and then voluntarily dismissed the condemnation action. The forest preserve district and Morton were unable to reach an agreement on compensation for the 18 acres. After the condemnation was dismissed, Stahelin filed an action for inverse condemnation charging the forest preserve district and Morton with conspiracy, violation of due process, and that certain ordinances were invalid and for an elimination of a cloud on Stahelin’s property due to the lis pendens filed in the previous condemnation action. The forest preserve district filed a motion to dismiss Stahelin’s inverse condemnation request. The appellate court affirmed the dismissal and also held that there was no cloud on the Stahelin real property when the condemnation action, which was the basis for the lis pendens, was voluntarily dismissed. Stahelin was left with his 18 acres next to the arboretum with no potential buyer, except the forest preserve district and Morton Arboretum. 5. [5.28] Streets and Parkways In Village of Algonquin v. Lowe, 2011 IL App (2d) 100603, 954 N.E.2d 228, 352 Ill.Dec. 368, many streets of the village had been designated on a plat but the streets were never built (and assumed never formally dedicated as required by statute). The village took steps to acquire the fee interest in these streets and parkways by filing a suit to condemn the streets and parkways. In the suit, “unknown owners” were added as defendants as is the custom in condemnation actions. Summons was issued and publication was made for unknown owners in the local paper. (Why publications are not made in this modern world on Facebook or Twitter is a puzzle to many Illinois lawyers). Terrence and Bonnie Nagel filed a §5/2-1401 petition (735 ILCS 5/2-1401) to set aside the judgment of condemnation as it affected their real estate. Nagels claimed the condemnation took part of their driveway. Nagels provided supporting affidavits that they lived at 1109 Pioneer Road, they had not been personally served, they used the driveway (land taken) as their primary access from the street to their garage, and they purchased their property in 1975 and had lived there since. The village had sent the Nagels several letters concerning the use of the driveway. The Nagels claimed their property by reason of adverse possession since they had been in open and notorious adverse possession of the land in question for more than 20 years. The trial court granted the Nagels’ §5/2-1401 petition and vacated the judgment. The village appealed, and the appellate court affirmed the dismissal. The trial court vacated the condemnation judgment as it affected the Nagels and their real property. The lesson learned in Algonquin is that all possible defendants, tenants, heirs, or any known party that may have an interest in the real property being condemned should be named as a



defendant/interested party in the complaint and served personally with summons. It may be a little expensive and time consuming, but lack of jurisdiction over a party that shows up after the property has been acquired by the public body and the improvement is on the property may be a much more expensive and time consuming problem. As suggested above, the Internet is the modern way to find “unknown owners.” Judges may well inquire of the public body’s condemnation lawyer if an Internet search has been made for unknown owners and possible heirs. 6. [5.29] Airports The O’Hare International Airport expansion of runways has made a lot of employment for condemnation lawyers, appraisers, engineers, trial judges, and even appellate court justices. O’Hare land was once land owned and operated primarily by vegetable farmers north of, and not contiguous to, the City of Chicago. The late Mayor Richard J. Daley determined that Midway Airport was too small for large planes. Midway was penned in, up to its borders, with commercial and residential homes. Transportation at Midway was insufficient to handle a modern airport. Mayor Daley annexed State Route 72 (Higgins Road) as a corridor to the proposed O’Hare Field thereby making O’Hare contiguous to, and part of, the City of Chicago. O’Hare grew by purchase, condemnation, and other acquisitions until it spread out of Cook County into the northeastern part of DuPage County. In the late 20th century, it was determined that O”Hare needed additional runways to accommodate large passenger and freight flying jet planes. There were many municipalities, commercial, residential, and manufacturing entities who were strongly in favor of, and bitterly opposed to, the expansion. Nevertheless the expansion slowly took place. There was still some lingering litigation to be addressed in the second decade of the 21st century. The more recent O’Hare case and other airport cases are discussed below. In Philip v. Daley, 339 Ill.App.3d 274, 790 N.E.2d 961, 274 Ill.Dec. 188 (2d Dist. 2003), Illinois Senate President James Philip sued Mayor Richard M. Daley challenging Chicago’s attempt to acquire property by condemnation to expand O’Hare International Airport. Chicago had not obtained a “certificate of approval” from the Illinois Department of Transportation (IDOT) as required by the Illinois Aeronautics Act (620 ILCS 5/47; 92 Ill.Admin. Code §14.640). Chicago claimed (as did the Village of Cary in Village of Cary v. Trout Valley Ass’n, 282 Ill.App.3d 165, 667 N.E.2d 1082, 217 Ill.Dec. 689 (2d Dist. 1996) (Cary I) and 297 Ill.App.3d 63, 696 N.E.2d 1154, 231 Ill. Dec. 583 (2d Dist. 1998) (Cary II) discussed in §§5.11, 5.15, and 5.16 above) that it did not need approval since the expansion was being done under the auspices of the Federal Aviation Administration. Chicago claimed federal preemption. The appellate court ruled against Chicago. This issue over an insignificant permit delayed the O’Hare International Airport expansion, a delay that could have been avoided by following the statute and obtaining the permit before commencing any land acquisition process. A condemnation lawyer must be prepared to meet and solve unusual issues that may arise. In City of Chicago v. St. John’s United Church of Christ, 404 Ill.App.3d 505, 935 N.E.2d 1158, 343 Ill.Dec. 930 (2d Dist. 2010), cemetery land in Chicago western suburbs was taken for the Congress Street Expressway. Instead of going straight, the Kennedy Expressway wraps around an established church just north of Chicago’s loop. Interstate 355 was diverted west of the Village of Downers Grove and was also moved slightly westward north of Route 20. St. John’s United Church of Christ’s cemetery was in the path of the O’Hare International Airport’s expansion. The



City of Chicago brought condemnation proceedings against St John’s Church for the acquisition of its church cemetery. St. John’s Church, its members, the owner of the cemetery lots, and descendants of those buried in the cemetery intervened in the condemnation action and filed a traverse seeking to dismiss the condemnation. They claimed numerous objections to the taking of the cemetery, including the taking was a violation of their religious rights contained in the federal and Illinois Constitution and the right to exercise their religion, improper notice had been published, and the taking was unnecessary. These same and similar claims of St. Johns, and some of the intervenors, had been made in the United States District Court challenging the city’s right to condemn for the airport expansion (St. John’s Church of Christ v. City of Chicago, 502 Fed.3d 616 (7th Cir. 2007). The trial and appellate court held that the city had the right to condemn, but res judicata barred the intervenors from raising the same objections in the case at bar that had been made in the federal court proceedings. The appellate court affirmed the DuPage County trial court’s denial of the traverse. In County of St. Clair v. Caseyville Rifle & Pistol Club, Inc., No. 5-09-0100, 2011 WL 10483334 (5th Dist. 2011) (unpublished), discussed in §5.14 above, the proposed gun club and shooting range was in the landing path of the airport. The condemnation had federal as well as local opposition. The condemnation failed for lack of enabling county resolution. Had St. Clair County had a proper resolution, the condemnation of the rifle and gun club would have been in order. C. [5.30] Mortgage Foreclosures A mortgage foreclosure is not usually an issue in the appeal of a condemnation case. As set out above, every party having a “stake” in the property being condemned must be made a party defendant to the suit. Often the holder of a first and second mortgage have a mortgagee’s interest in the condemnation and its award. In Baker v. Forest Preserve of Cook County, 2015 IL App (1st) 141157, 33 N.E.3d 745, 393 Ill.Dec. 1, Richard and Meryl Cannon (and their entities) owned a horse farm known as Horizon Farms on Algonquin Road in Barrington, Illinois. There was a $14 million outstanding loan on the farm with BMO Harris Bank. The bank had foreclosed on the mortgage when payments were not made current. The forest preserve district bought Horizon Farms at the foreclosure sale and acquired title to the property by sheriff’s deed. The sale was confirmed by the mortgage foreclosure court. The forest preserve district paid the bank $14 million for the sheriff’s deed. The crux of a taxpayers’ suit, in which the Cannons participated, claimed that the district did not have the legal power to acquire land from an assignment of mortgage and foreclosure sale. The trial court dismissed the Cannons’ complaint, and the appellate court affirmed the dismissal. The appellate court opined that the forest preserve district had a right to acquire property “by gift, grant, legacy, purchase or condemnation.” (70 ILCS 810/8. (Postscript to Baker: In June 2016, the Chicago Tribune stated that the issue of the forest preserve district’s acquisition of the Horizon Farm is still in court, and the Cannons have not given up yet. Robert McCoppin, New forest preserve provides natural beauty, but land dispute gets ugly, Chicago Tribune, June 24, 2016.) D. [5.31] Condemnation and Interplay Among Public Bodies Most public bodies must cooperate with their counterpart since the two public bodies must “live together” forever after. Occasionally, the two public parties are unable to agree. In Village



of Woodridge v. Board of Education of Community High School District 99, 403 Ill.App.3d 559, 933 N.E.2d 392, 342 Ill.Dec. 806 (2d Dist. 2010), the City of Woodridge sought to acquire a parcel of vacant land that was next to the village hall. This adjoining land was owned by the high school district, which refused to sell, and the village commenced condemnation to acquire the parcel. The high school district claimed the land was being held for possible future expansion. The trial court denied the traverse and permitted the condemnation to proceed. The high school district appealed, and the appellate court affirmed the dismissal of the high school district’s traverse. In Trotter v. Spezio, 349 Ill.App.3d 959, 812 N.E.2d 577, 285 Ill.Dec. 757 (3d Dist. 2004), the township highway commissioner filed a condemnation citing as authority 605 ILCS 5/6-303, et seq. The owner filed a traverse claiming that using the statutory designation of “et seq.” was an insufficient citing of legal authority to support the condemnation action. The court held that the cited authority of “et seq.” was sufficient. The interplay of local, state, and federal bodies must be considered in a condemnation proceeding. This conflict was raised in MCI Worldcom Communications, Inc. v. Metra Commuter Rail Division of Regional Transportation Authority, 337 Ill.App.3d 576, 786 N.E.2d 621, 272 Ill.Dec. 82 (2d Dist. 2003). MCI condemned Metra to install an underground fiber-optic cable in the Metra rail line. Metra filed a traverse claiming that Metra was a public body and statutory approval was required for one public body to condemn another. The trial court ruled in favor of Metra, and MCI appealed, claiming that the denial of its right to install the cable, which was part of a nationwide communications system, was a violation of the Federal Telecommunications Act of 1996, 47 U.S.C. §253. The appellate court affirmed the ruling in favor of Metra, holding that MCI had a right to condemn private property but the language of the Federal Telecommunications Act did not extend to public property. This MCI decision could be an important decision for many public bodies when communications, pipelines, high lines, and other interstate carriers seek easement rights through public lands. E. [5.32] Lessees’ Claims to Part of the Award In a condemnation action, the public body seeks to take the whole fee interest in the real estate. The interest taken includes rights of the owner, tenants, lien and mortgage holders, and any unknown owners or descendants. Once the public body deposits the award with the county treasurer and takes possession of the property, the public body has no further interest in the distribution of the funds. The parties of interest will petition the court for an order on the county treasurer for distribution. Notice of the petition to withdraw must also be given to all parties of record and the state’s attorney as the attorney for the county treasurer. A title report will be required by the state’s attorney. Usually the condemnor has a recent title report and will furnish the condemnee with a copy of the report for use in the distribution. The lessees/tenants have been parties to the proceedings. If the lease has expired, or there is a condemnation clause in the lease, the tenant should remove his or her trade fixtures and move on. If the lease does not have a condemnation clause and there is substantial time to run on the lease, the tenant might be successful in receiving a portion of the award. However the lease often expires while the litigation is pending thus leaving the lessee with no piece of the condemnation proceeds. The owner should consider that while litigation with a tenant over the distribution of moneys on deposit with the county treasurer is pending, no moneys will be disbursed by the treasurer until



the trial court rules and all time for appeals has passed. The best for both parties is a compromised settlement so the funds may be disbursed. Perhaps a petition and court order might be entertained by the trial judge to permit a partial distribution to the owner pending a final resolution of the matter. Assume there is a ten-year lease on a restaurant and there are still five years to go on the lease when the award moneys are deposited with the county treasurer and possession has been surrendered. What can the tenant expect from the moneys on deposit? If the lease was for $1,000 per month and comparable restaurant space is now leased for $2,000 per month, the tenant’s claim would be at least $1,000 per month for the balance of the five years of the original lease term, or $60,000, discounted to present value. If the tenant has an option for an additional ten years, the law is a little hazy whether the tenant may have a recovery for a future option period. The above caselaw indicates that the tenant is entitled to part of the award for a future option or extension period. The tenant may have never exercised the option. The other side of that argument is that the fair market value of the lease space is double the set option rent. That argument does not seem to carry much weight under present caselaw. If the lease is to pursue a claim for part of the award, the proof must be by competent evidence that is difficult to obtain. One of the difficulties in proving these leasehold damages is securing comparable lease data of a like business. The real estate appraiser (expert witness) may be able to make a case for the lessee, but it may all be in vain if the lessee has no stake in the award and options do not count. Relocation assistance under the Eminent Domain Act may help in taking the sting out of moving a business. Many businesses have unique problems that make relocation nearly impossible. A cleaning business is a good example. Because of serious environmental problems in the past due to cleaning businesses disposing cleaning fluids on premises, cleaning businesses are nearly impossible to relocate. Many other businesses that have been in place for many years may face similar difficulties in relocating and go out of business. In Public Building Commission v. Yellen, 2013 IL App (1st) 112638, 986 N.E.2d 706, 369 Ill.Dec. 393, there was a condemnation award of $1,950,000. The tenant sought an apportionment of the award. The lease had expired but the tenant had issues of whether the option to extend the lease was still in place. The trial court (Judge White) awarded the tenant $380,000 for the tenant’s interest in the award. The appellate court reversed any payment to the tenant, the tenant’s appraiser, or any other offsets against the owner from the final award. This case appears to hold that, even if there were possible options to extend, once a lease has expired the tenant is entitled to no part of the award. In Village of Palatine v. Palatine Associates, LLC, 2012 IL App (1st) 102707, 966 N.E.2d 1174, 359 Ill.Dec. 486, the village acquired a shopping center for a police station. The jury award was $6 million. The tenants sought part of the award. The shopping center owner filed a motion declaring that the tenant had no interest in the award. The tenants claimed they had options to extend the lease for two additional option periods of five years each. The trial court (Judge Alexander P. White) denied any apportionment of the award to the tenants. The tenants appealed and the denial of recovery for the option periods was affirmed. An earlier decision of this same Palatine case, Village of Palatine v. Palatine Associates, LLC, 406 Ill.App.3d 973, 942 N.E.2d 10, 347 Ill.Dec. 177 (1st Dist. 2010), concerned the trade



fixtures in the Palatine shopping center. One of the tenants, One Hour Cleaners, filed a petition seeking compensation for its trade fixtures. The owners filed a motion to dismiss One Hour Cleaners’ claim. One Hour Cleaners claimed it had improved the property with “substantial cleaning fixtures” that contributed to the value of the property. 942 N.E.2d at 14. One Hour Cleaners filed a petition for “just compensation,” claiming it had a compensable interest in the award. Id. The trial judge, Alexander P. White, ruled that at the time of the award, the lease had terminated and One Hour Cleaners had no interest in the final award and was entitled to no just compensation. An appeal followed. The appellate court in this earlier decision said a trade fixture is personal property and is affixed to the real estate to carry out the tenant’s business. There is a three-part test to determine whether a trade fixture is part of the real estate: (1) the means by which the item has been affixed to the real estate; (2) whether the item is adapted to and necessary for the intended use of the property; and (3) the intent of the parties. 942 N.E.2d at 16. A trade fixture is the tenant’s property and may be removed by the tenant as long as the removal does not damage the realty. The court said that “a trade fixture remains the property of the tenant and compensation for a trade fixture taken by eminent domain is owed to the tenant.” Id. One Hour Cleaners’ problem went to basic landlord-tenant law. The lease provided that in the event of condemnation, the compensation for the taking belonged exclusively to the landlord. The lease had expired in 2004, but One Hour Cleaners stayed on as a holdover tenant, which put it on a month-to-month tenancy. The decision points out that parties may contract governing their rights to compensation in the event of condemnation. Since the shopping center was being torn down to make way for a police station, One Hour Cleaners was entitled to remove any removable trade fixtures. Usually, if the property is to be razed, the condemnor will permit the tenant to remove fixtures attached to the real estate including heating, plumbing, and light fixtures. Lessees’ claims in condemnation cases are most difficult in many respects. The EDA has attempted to take some of the “sting” out of lessees’ losses by providing for relocation assistance. Time will tell how well that program will work out. The owner of the family hardware store or cleaners that has been on a year-to-year lease for 50 years has no stake in the condemnation award. The goodwill that was established by that family business is not transportable to the mall where Home Depot or Walgreens is located. Most commercial leases provide that in the event of condemnation, the entire condemnation award belongs to the owner. The tenant owes rent to the end of the current year or prorated to the date of possession by the condemning body. Lamar Advantage G.P. Co. v. Addison Park District, 354 Ill.App.3d 130, 820 N.E.2d 626, 289 Ill.Dec. 850 (2d Dist. 2004), also confirmed that when a lease expires there is no compensation available for the lessee. Lamar had a 15-year billboard lease on land that was acquired by the park district and annexed to the Village of Addison. The billboard lease expired, and the park district refused to renew or extend the lease due to Addison’s no billboard stand. Lamar filed suit claiming inverse condemnation. The trial court dismissed the complaint, and Lamar appealed. The appellate court affirmed, finding that there was no compensable condemnation action since the billboard leases had expired.



If there is even a remote possibility of any condemnation action, attorneys for owners should include a standard condemnation clause that provides that in the event of condemnation, no part of any condemnation award will be paid to the tenant. F. [5.33] Home Rule Home rule in condemnation is virtually dead in Illinois. In 1970, the Illinois Constitution provided for home rule power to certain local governmental units. ILL.CONST. art 7, §6. Using home rule as a basis, the City of Carbondale enacted its own quick-take ordinance, but the Illinois Supreme Court held the quick-take statute invalid. City of Carbondale v. Yehling, 96 Ill.2d 495, 451 N.E.2d 837, 71 Ill.Dec. 683 (1983). The same rationale that a municipality, under home rule, may not enact ordinances in derogation of state statutes has been followed in disconnection proceedings. In LaSalle National Trust, N.A. v. Village of Mettawa, 249 Ill.App.3d 550, 616 N.E.2d 1297, 186 Ill.Dec. 665 (2d Dist.), appeal denied, 153 Ill.2d 560 (1993), the Village of Mettawa enacted stringent requirements that practically prohibited any property owner from disconnecting from the village. The Mettawa ordinance was contrary to the state statute that sets out simple requirements for disconnection, including that property sought to be disconnected is in excess of 20 acres and at the border of the municipality. Several other villages, such as Barrington Hills and Long Grove, joined Mettawa in the appeal. These municipalities wanted to enact their own requirements for disconnections in derogation of state statutes and sought appellate court approval. The appellate court affirmed the striking down of the Mettawa ordinance. The Illinois Supreme Court denied leave to appeal. Schillerstrom Homes, Inc. v. City of Naperville, 317 Ill.App.3d 1168, 783 N.E.2d 243, 270 Ill.Dec. 668 (2d Dist. 2000) (Rule 23), reaffirms the rule that even though a municipality has home rule, the state statute must be followed when there is a conflict with the local ordinance. In Schillerstrom, the developer submitted plans to raze a house and build two new homes. The city did not act on the plans within 60 days as required by state statute (65 ILCS 5/11-12-8). Naperville had passed a similar ordinance, except the state statute provided for damages to the builder if the plans were not acted on within the 60 days, while the ordinance did not. Naperville claimed its ordinance trumped the state statute and the ordinance complemented the state statute. If there is a conflict regarding whether a municipal ordinance “complements” or “supersedes” the state statute, the state statute interpretation takes precedence. There is a caveat to the statement that home rule in condemnation is dead. A spark of life may still be in home rule for the City of Chicago. In City of Chicago v. Boulevard Bank National Ass’n, 293 Ill.App.3d 767, 688 N.E.2d 844, 846, 228 Ill.Dec. 146 (1st Dist. 1997) (discussed in §5.11 above), when the city realized it needed the Oliver Building, it passed an ordinance authorizing condemnation “pursuant to the City’s home rule power in a quick take proceeding.” [Emphasis added.] The appellate court affirmed the right of the city to condemn the Oliver Building. There is no further reference in the opinion concerning the city’s home-rule power. Neither the Supreme Court’s earlier decision in Yehling, supra, nor the Second District’s decision in Mettawa, supra, is mentioned in the First District’s opinion. Perhaps the City of Chicago has home-rule quick-take powers that are not granted other municipalities. Although the death knell was rung in the opening sentence of this section, State Bank of Waterloo v. City of Waterloo, Illinois, 339 Ill.App.3d 767, 792 N.E.2d 329, 275 Ill.Dec. 98 (5th



Dist. 2003), held that the city could deny a driveway cut even though the Illinois Department of Transportation had granted the owner access points. IDOT had brought condemnation for a bypass around Waterloo. As part of a settlement with the owner, IDOT granted two access points on the bypass. The City of Waterloo denied the access permits, claiming that the access failed to meet safety standards and did not comply with the city’s comprehensive plan and subdivision ordinances that were passed after IDOT had granted the owner the permits. The owner claimed that the state permits preempted the city’s denials. The trial court held that IDOT’s granting of the permit did not preempt the local control over the access points. The owner appealed, and the appellate court affirmed the denial of the two access points. At the conclusion of the case, the appellate court indicated that the battle may not be over. The case was remanded to the trial court to determine whether the refusal to grant access by the city was a taking or a mere regulatory restriction. If the refusal was a taking, the owner may be entitled to damages for loss of access. If the denial of access is a regulatory taking, similar to erecting an unmountable median in the front of commercial property, then there are no damages. The issue of municipal regulatory taking is discussed further below. In City of Oakbrook Terrace v. Suburban Bank & Trust Co., 364 Ill.App.3d 506, 845 N.E.2d 1000, 301 Ill.Dec. 135 (2d Dist. 2006), Oakbrook Terrace brought a zoning enforcement action against a billboard company to enforce its 1980 zoning ordinance prohibiting off-premises, freestanding signs and requiring them to be removed by 1988. The enforcement action was not commenced until 1999. The billboard owner claimed that the enforcement of the zoning ordinance was an unlawful taking without just compensation. The city was a home-rule municipality, and under its authority, it had a right to regulate signs as it determined to be in the best interests of the city and its residents. The city claimed it derived its home-rule powers under ILL.CONST. Art. VII, §6, which provides for municipal home-rule authority. The trial court granted summary judgment in favor of the billboard company, holding that the city’s action was a compensable taking even though the ordinance was in effect for nearly 20 years, giving the defendants plenty of time to remove their signs. The court held, and the appellate court affirmed, that “[w]here an ordinance contravenes a state statute . . . the courts have not hesitated to find it an invalid exercise of home rule authority.” 845 N.E.2d at 1010. The appellate court concluded that the city’s attempt to replace “just compensation” for a taking of the signs with an amortization program “infringes on the state judiciary and is an impermissible exercise of its home rule authority.” 845 N.E.2d at 1011. There was a dissent, but the case did not reach the Illinois Supreme Court. In condemnation, conflict between local and state regulations may be avoided by following state statute and caselaw. The condemnor should avoid attempts at adopting its own rules and regulations contrary to state statutes. Boulevard Bank National Ass’n, supra, was based on a home-rule ordinance power. The issue of home rule was not addressed in the opinion. Other Illinois cases have clearly set out that there is no condemnation power except under state statues. In City of Berwyn v. Ryczek, No. 2008-L-50663 (Cook Cty.Cir. 2008), the plaintiff pled home rule as one of Berwyn’s bases for a tax increment financing condemnation. Berwyn claimed it was bringing the action, in part, based on its home-rule powers. The claimed home-rule basis was challenged. The trial court denied the challenge, but the parties settled the cause, leaving no appellate ruling on this issue.



Home rule is touched on in the Lamar Whiteco Outdoor Corp. v. City of West Chicago, 355 Ill.App.3d 352, 823 N.E.2d 610, 291 Ill.Dec. 318 (2d Dist. 2005), billboard case. The City of West Chicago attempted to control billboards through its home-rule power. The lower court rejected the municipality’s home-rule taking. See §5.32 above for a discussion on Lamar. Attorneys representing municipalities should be cautioned on pleading home rule as one of their bases for a condemnation. Pleading home rule as a basis for taking private property only opens the door for the granting of a traverse and a trip to the appellate court. The EDA is a lengthy statute that is adequate to support a legally sufficient condemnation proceeding without resorting to home rule and possible appeal. G. [5.34] Abandonment of a Condemnation Action The condemnor has the right to abandon a condemnation action any time up until the moment the condemnor takes possession of the subject property. In City of Chicago v. Harris Trust & Savings Bank, 346 Ill.App.3d 609, 804 N.E.2d 724, 281 Ill.Dec. 759 (1st Dist. 2004), Chicago condemned the northeast corner of State and Randolph Streets as part of a tax increment financing district. The building across from Marshall Fields had several retail stores, including Walgreens. A large leased space for an outdoor billboard was on the building’s roof. Chicago petitioned for quick-take in February 2001 and deposited $92,400 with the county treasurer as preliminary compensation for the billboard lessee’s rights, which expired November 30, 2001. The billboard lessee petitioned to withdraw the $92,400 deposit. Chicago decided it did not need the property before the November lease expired. Chicago sought to abandon the take, withdraw the deposit, let the lease run out, and pay the billboard lessee’s attorneys’ fees and costs. The trial court held that a condemnor may abandon the condemned property at any time prior to taking possession of the property. The appellate court affirmed. H. [5.35] Notice Notice of the suit by summons is not the only important notice in a condemnation case. Before the municipality, public development authority, or even the O’Hare Modernization Program, there are public hearings, and notice of those hearings is published in newspapers of general circulation. In some cases, notice of the project must be personally served on the landowner affected. A good example of the issue of notice and problems that might arise is a tax increment financing district. Some TIF districts were formed over twenty years ago. Prior to the formation of a TIF district, the municipality must have had public hearings at which citizens could voice objections. Those hearings must have had public notice published in a local newspaper. Twenty years later, the local paper may have gone out of business, and certification of the publication is no longer available. Twenty years after the claimed public meeting, the condemnation is commenced, and the landowner challenges by traverse the failure of the municipality to produce the certificate of publication. In Passalino v. City of Zion, 237 Ill.2d 118, 928 N.E.2d 814, 340 Ill.Dec. 567 (2009), the Illinois Supreme Court addressed the issue of notice of public hearings. In 1971, Zion zoned a parcel of real estate that permitted 8 single-family and 142 multiple-unit dwellings for a total of 150 units on the parcel. In 1996, Zion determined to eliminate the multiunit dwelling zoning and permit only single-family units on the property. In 2001, the owner sought to develop the



property and learned for the first time of the zoning change. Zion claimed it published the notice for hearing of the proposed zoning change in the local newspaper pursuant to the Illinois Municipal Code, 65 ILCS 5/11-13-2. The owner (Passalino) filed suit claiming the notification by publication was not sufficient notice to satisfy the due-process requirements of the state and federal Constitutions. The owner filed a motion for summary judgment that was granted by the Lake County Circuit Court. The court held that the provision of the Municipal Code was unconstitutional and void as to the owner’s parcel. Since there was a challenge of the constitutionality of a state statute, appeal was directly to the Illinois Supreme Court. The trial court was affirmed. In the Passalino opinion, Chief Justice Fitzgerald quoted and relied on Mullane v. Central Hanover Bank & Trust Co., 339 U.S. 306, 94 L.Ed. 865, 70 S.Ct. 652 (1950), stating:

An elementary and fundamental requirement of due process in any proceeding which is to be accorded finality is notice reasonably calculated, under all the circumstances, to apprise interested parties of the pendency of the action and afford them an opportunity to present their objections. 928 N.E.2d at 819, quoting Mullane, supra, 70 S.Ct. at 657.

Justice Fitzgerald said:

[T]he Mullane Court held that notice by publication is not sufficient with respect to an individual whose name and address are known and easily ascertainable. . . . Hence, notice by publication was inadequate “not because in fact it fails to reach everyone, but because . . . it is not reasonably calculated to reach those who could easily be informed by other means at hand.” [Citation omitted.] 928 N.E.2d at 820, quoting, Mullane, supra, 70 S.Ct. at 660.

Publication in local newspapers of proposed public projects, foreclosures, and probate notices for heirs and claimants was adequate 150 years ago. Such publication of legal notices in the Chicago Law Bulletin or in a downstate newspaper in the help wanted and used car ads does not comport with present day federal or state constitutional due process. This is particularly true when the Internet will reach the missing heir who left for Alaska 30 years ago. Attorneys for condemnors should make a concerted effort to notify any potential landowner whose property might be subject to a condemnation taking early in the proceedings. Attorneys for landowners should carefully investigate all hearing and legislative requirements, including the claimed notices, and challenge the proceeding with a traverse if the constitutionally mandated due-process notice has not been met. I. [5.36] Good-Faith Attempt To Settle Before Suit The Eminent Domain Act (and prior legislation) requires the condemning body to enter into good-faith negotiations with the landowner before suit is filed. In the past, most condemning bodies treated the acquisition of private property for a public use as an arm’s-length transaction. The negotiations for purchase were similar to bargaining for a used car except the public body held the “club” of condemnation in the other arm if the landowner did not sell. In those past good-faith negotiations, the condemning body did not furnish the owner a copy of the appraisal. Often the offer to purchase was less than the condemning body’s own appraisal. All public bodies



now follow the legally accepted procedure of furnishing the public body’s appraisal and entering into good-faith attempts to settle the issue of just compensation before suit. It is surprising to read City of Chicago v. Zappani, 376 Ill.App.3d 927, 877 N.E.2d 17, 315 Ill.Dec. 530 (1st Dist. 2007), which confirms the necessity of furnishing the landowner a copy of the appraisal before suit is filed. In Zappani, the city sent several letters along with a settlement offer to the owner. No appraisal was furnished. The owner failed to respond. Suit was filed, and the owner filed a traverse claiming no appraisal was furnished, and no good-faith attempt to negotiate a settlement was made before suit was filed. The trial court granted the traverse, and the appellate court affirmed, holding that furnishing the appraisal report to the owner prior to filing suit to condemn is mandatory to meet the good-faith negotiation statutory requirement. The law is clear: No appraisal report, no condemnation. Bona fide offers to settle are covered in other chapters in this handbook, but a word here is important as it relates to condemning bodies. Negotiations may become clouded as in Illinois State Toll Highway Authority v. DiBenedetto, 275 Ill.App.3d 400, 655 N.E.2d 1085, 211 Ill.Dec. 702 (1st Dist. 1995). Until DiBenedetto, a written offer to the owner based on a written appraisal of the property at its highest and best use was sufficient. Lake County Forest Preserve District v. First National Bank of Waukegan, 200 Ill.App.3d 354, 558 N.E.2d 721, 146 Ill.Dec. 758 (2d Dist. 1990). In DiBenedetto, the developer for Sears had a $2.5 million offer on the table at the same time the tollway had offered the owners only $1 million. The court found that the tollway was not bound by Sears’ offer and the trial court erred in finding that the tollway had not made a good-faith offer of settlement. To avoid any possible adverse traverse ruling, the attorney for the condemning body should send a final written offer of settlement to the owners prior to filing the suit to condemn. 1. [5.37] What Is the Date of a Taking? The standard recognized rule of condemnation for the date of taking and valuation of property being condemned is the date of the filing of the suit to condemn. However, the Eminent Domain Act has a rule that if the condemnation case does not go to trial within two years, the court, in its discretion, may set a new valuation date that may be a date between the original filing and the trial date. The appraisals, all reasonable probabilities of rezoning, annexation, utilities available, traffic counts, comprehensive plans in place, and other matters that might affect value are as of the date of the taking, which is the date of filing the suit or such later date if the trial is not commenced within two years. In an inverse condemnation proceeding, the date of the taking may be a critical valuation issue. 735 ILCS 30/10-5-60. Department of Transportation v. Chicago Title & Trust Co., 303 Ill.App.3d 484, 707 N.E.2d 637, 236 Ill.Dec. 510 (1st Dist. 1999), addressed the date of taking and valuation as of the date of the filing the suit, finding that how the remainder is used or assembled after the take has no effect on the value of the original parcel of the property. The Illinois Department of Transportation condemned three lots at Routes 59 and 20 near Bartlett for widening and improvement of the grade separation. The three lots were on the north side of Route 20. The middle lot was the Starview Drive-In Theater. The other two lots were on the east and west sides of the Starview. The east parcel was ten acres and was condemned first. Part of the parcel was taken by quick-take in 1991, leaving a seven-acre remainder. The parcel west of Starview was an auto salvage yard. The three contiguous properties were in unincorporated Cook County without sewer or water.



Prior to the condemnation of the east parcel, the then-owner of the east parcel had entered into articles of agreement to sell the east parcel to a Boulevard Bank land trust. The closing on the sale to Boulevard Bank was completed in January 1991. The Starview middle parcel condemnation was filed in August 1989. The Starview parcel was owned by Chicago Title under a land trust and was 26 acres. IDOT took about half an acre of frontage from Starview, including all of Starview’s access to Route 20. In March 1988, Chicago Title (Starview) had entered into an agreement with Boulevard Bank for the sale of the Starview to Boulevard Bank. The closing took place in January 1991, at the same time the east parcel owner closed and conveyed the east parcel to Boulevard Bank. The west parcel (an auto salvage lot) was condemned by IDOT on August 10, 1989. The west parcel was nine acres, and title to the property was in a land trust with LaSalle National Bank. In May 1989, the owner of the west parcel had entered into a contract to sell the west parcel to Boulevard Bank, as trustee. The same attorney appeared for Boulevard Bank for the west parcel as well as the Starview parcel. In 1992, IDOT filed a motion to consolidate the condemnation proceedings for the Starview and west parcels. The court denied the motion to consolidate the two parcels for trial. In 1993, IDOT filed a motion for judicial declaration that the remainder of the Starview property (which was now otherwise landlocked) was part of the remainder of the east and west remainders. IDOT had found out that the owners intended to develop the three lots into a unified commercial development and that, with the east and west parcel remainders, the Starview parcel would not be landlocked but would have road access through the east and west parcels. If the Starview parcel stood alone, there would be substantial damages to the remainder for the loss of access. If the Starview parcel remainder was part of the remainder of the other lots, the Starview parcel would not be landlocked and the damage to the remainder would be substantially less. Presiding Judge Alexander P. White denied IDOT’s motion to consider Starview’s remainder part of the remainder of the adjoining lots. The case proceeded to trial on the Starview parcel standing alone with damages due to loss of access, and the jury awarded $1,114,312 for damages to Starview’s remainder. On appeal, the appellate court held that on the date of the filing of the Starview condemnation suit (August 18, 1989), title to the three parcels was with different holders of title. Any activity or transfer of title after the filing of the complaint to condemn was irrelevant as to valuation in an eminent domain proceeding. The only question for the jury was the determination of the just compensation to be paid to the owner of the property being condemned at the property’s value on the date of the filing of the action to condemn. The appellate court went on to say that “[t]o hold that the remainder value of the parcels should have been determined after the [owners of the adjoining east parcel] acquired title to the parcels would require that the value of the parcels be determined at a time later (by approximately two years) [when the closing took place in 1991] than when the complaint was filed. This would be in violation of the Eminent Domain Act. See 735 ILCS 5/7-121.” [Emphasis added.] 707 N.E.2d at 647. The appellate court affirmed Judge Alexander White’s ruling. Chicago Title & Trust must be compared with City of Quincy, Illinois v. Diamond Construction Co., 327 Ill.App.3d 338, 762 N.E.2d 710, 261 Ill.Dec. 141 (4th Dist. 2002). The Diamond property was an asphalt plant. Diamond was aware of the imminence of the taking of its



property. Quincy wanted the land but not an asphalt plant. Diamond, anticipating being dispossessed of its asphalt plant by condemnation, started disassembling and relocating the asphalt plant. With the asphalt plant disassembled, Quincy had the property appraised by its appraiser on the day before the condemnation suit was filed. The appraiser appraised the property, not as a working asphalt plant in place, but as property minus the asphalt plant. The trial court held that the property had to be appraised as a working asphalt plant as of the date of the taking even though the asphalt plant no longer existed on the date of the filing. The appellate court affirmed the lower court’s ruling. 2. [5.38] What Are the Landowners Rights During Pending Condemnation? In Department of Natural Resources of State of Illinois v. Brauer, 339 Ill.App.3d 723, 791 N.E.2d 120, 274 Ill.Dec. 324 (3d Dist. 2003), Brauer purchased a ten-mile abandoned Milwaukee Road rail line from the bankruptcy court. The right-of-way ran north and south from Joliet cutting across the corner of the new Chicago/Joliet NASCAR racetrack, along the western border of the small rural village of Manhattan, and ending on the north edge of the Joliet Arsenal. Brauer removed and sold the rails and ties. Because many pipelines run east and west to go around Lake Michigan, Brauer sold many pipeline and underground easements across the rail line. The Illinois Department of Natural Resources (DNR) filed suit to condemn the ten-mile rail line for a hiking/biking trail in January 1999. The matter went to trial in 2001, and the jury awarded Brauer over $1 million for his 100-foot strip of land ten miles long. After the trial, the DNR determined that after the filing of the suit to condemn in January 1999, Brauer continued to sell pipeline, water, and sewer line easements along with an annexation agreement that a developer sought so he could be contiguous to the Village of Manhattan. Brauer was paid $35,000 for the easements and annexation agreement. These easements joined the many other easements that had been granted precondemnation. None of the underground easements or the annexation agreement would affect the proposed hiking/biking trail. DNR sought a setoff of $35,000 from the award. The $35,000 setoff was granted by the trial court, and an appeal followed. The appellate court in a two-to-one decision reversed the setoff of the $35,000 against Brauer’s award. The appellate court found that there was no order during the pendency of the suit barring Brauer from selling easements and that the selling of the easements was not double compensation for the owner. DNR claimed that it was entitled to receive title to the property unencumbered with additional easements. DNR had filed lis pendens giving notice to the whole world, including the developers and grantees of easements, of the condemnation action. DNR could have filed a petition evicting those persons claiming rights in the hiking/biking trail. It would have been politically incorrect for DNR to cut off gas, water, sewer, and cable TV to those new village homeowners who were annexed to the Village of Manhattan by the annexation and contiguity that was established over and under the hiking/biking trail. There was a dissent in Brauer. The dissenting justice opined that the sale of valuable easement rights, “like any other valuable asset in the land, depreciated its value.” 791 N.E.2d at 124. When there is no quick-take, the property owner, unless enjoined, may deal with his or her property without restriction. Farmers plant and harvest crops. Oil fields and gravel pits continue to be pumped and mined. The granting of a setoff may materially change the law of the date of valuation. Should the owner convey, transfer, encumber, or even grant easements after the filing of the condemnation action the condemnor has the legal right to seek to quiet title and evict the subsequent grantee from the condemned property, provided the condemnor has recorded a lis pendens notice and successfully completes the condemnation action.



If the condemnor learns that the owner is changing the landscape of the property to be condemned and that such changes will affect the proposed anticipated use of the condemnor, suit for condemnation should be immediately filed. In addition to standard condemnation language the complaint should also contain a count for a temporary restraining order and temporary and permanent injunctions to restrain the owner from destroying the property for the use intended by the condemnor. In Forest Preserve District of DuPage County v. West Suburban Bank, 249 Ill.App.3d 900, 621 N.E.2d 215, 190 Ill.Dec. 346 (2d Dist. 1993), rev’d, 161 Ill.2d 448 (1994) (also discussed in §5.10 above), Harry W. Kuhn, Inc., was the beneficial owner. Kuhn was a large road contractor with many pieces of construction equipment. The forest preserve district sought to condemn his construction yard he had operated for many years. Kuhn believed that newly arrived neighbors on the bluff overlooking the construction yard had lobbied the forest preserve district to eliminate the construction yard from their view. When condemnation was filed, Kuhn, with all of his construction equipment, in a weekend, changed the landscape of the construction yard and built a huge mountain of dirt. The forest preserve district was in court immediately for a temporary restraining order and emergency injunction, which were granted. Kuhn appealed the granting of the injunction, and the appellate court reversed the injunction. The forest preserve district appealed to the Supreme Court, which reversed the appellate court and put the injunction back in place. The same or similar stories abound in Illinois when the owner, upon learning of the proposed condemnation, will cut down all the trees in the proposed park, permit the land to be flooded, or take other steps to hinder or eliminate the desire of the condemning body to acquire the site. When a change in the property is contemplated, or happens, the attorneys for both sides must be prepared to meet the challenge of the seeking and defense of temporary restraining and injunction actions. Emotions run high when an owner of many years sees his or her property, home, or business being taken by condemnation. Counsel for both sides must be prepared for unexpected actions. Parties to condemnation should follow the majority and dissenting opinions in Brauer, supra, if faced with a conveyance, change in the property’s condition, or use of the property after the filing of the suit to condemn and before the title and possession vests in the condemnor. J. [5.39] Casinos vs. Horse Tracks Illinois has passed legislation requiring that for two years riverboat casinos that had over $200 million in receipts were required to pay three percent of the overage to a fund that was distributed to the Illinois licensed horse racing tracks. See Riverboat Gambling Act, 230 ILCS 10/1, et seq. In Empress Casino Joliet Corp. v. Giannoulias, 231 Ill.2d 62, 896 N.E.2d 277, 324 Ill.Dec. 491 (2008), the Illinois Racing Board was in charge of the distribution of the money. The casinos filed suit in Will County, challenging the constitutionality of the statute. The casinos claimed the State of Illinois and Illinois Racing Board were taking money from the casinos in violation of the federal and state Constitutions. The Will County trial judge declared the taking unconstitutional. The defendants appealed directly to the Illinois Supreme Court since the constitutionality of Illinois legislation was at stake.



The court held (l) the three-percent tax on all Illinois casinos was not arbitrary or unreasonable and was not unconstitutional; (2) the Takings Clauses of the United States and Illinois Constitutions were not applicable; and (3) the three-percent tax served a public purpose as required under the Public Clause of the Illinois Constitution. In short, there was no inverse condemnation. K. [5.40] Oil Wells In Leavell v. Department of Natural Resources, 397 Ill.App.3d 937, 923 N.E.2d 829, 337 Ill.Dec. 978 (5th Dist. 2010), the operator of oil wells filed a complaint for judicial review of a decision of the Department of Natural Resources finding the operator had abandoned the wells and permitting the wells to be transferred to another oil company. On review, the trial court entered judgment in favor of DNR. The operator, in its appeal, asserted that the declaration of abandonment of the oil wells was an unconstitutional taking of the operator’s interest in the wells. The appellate court, in affirming the trial court and DNR’s position, held that the transfer of the operator’s interest in the oil wells to another oil well company did not constitute an unconstitutional taking. L. [5.41] No Money for Bondholders In City of Chicago v. Prologis, 236 Ill.2d 69, 923 N.E.2d 285, 337 Ill.Dec. 726 (2010), the City of Chicago brought a condemnation action to acquire property. Part of the property was in a tax increment financing district. The project had been financed by the issuance of bonds. The value of the bonds was less than the value of the property. The landowners and bondholders filed counterclaims for inverse condemnation seeking compensation for the bonds. The trial court denied the inverse condemnation, and the landowners and bondholders appealed. The appellate court affirmed, and the Supreme Court granted leave to appeal. The Supreme Court, in affirming the trial and appellate courts, held that the city was not required to pay just compensation to the bondholders of the TIF bonds for the loss of the bonds’ value. The TIF bonds were secured solely by the possible increase in real estate taxes. The acquisition by the city caused the real estate to become tax exempt. M. [5.42] Interest on Abandoned Property In Cwik v. Topinka, 389 Ill.App.3d 21, 905 N.E.2d 300, 328 Ill.Dec. 766 (1st Dist. 2009), the owners of abandoned property brought a class action against the Illinois State Treasurer claiming the state was taking and retaining the interest on unclaimed property that had been deposited with the State Treasurer. On this issue, the appellate court held that retention by the state of interest actually earned on the abandoned property did not constitute a taking when the properties were not earning interest at the time the properties were abandoned. N. [5.43] Billboards Lamar Whiteco Outdoor Corp. v. City of West Chicago, 355 Ill.App.3d 352, 823 N.E.2d 610, 291 Ill.Dec. 318 (2d Dist. 2005), subsequent appeal, 395 Ill.App.3d 501 (2d Dist. 2009), arose when West Chicago amended its ordinance to ban billboards over a seven-year amortization period. The city did not enforce the ordinance for many years, and when the city sought to



enforce the ordinance, Lamar filed suit claiming the enforcement was an unconstitutional taking and a violation of Lamar’s civil rights. The trial court dismissed the claims. The appellate court reversed and remanded. On remand, Lamar sought attorneys’ fees, claiming it was the prevailing party under the Civil Rights Act of 1871, 42 U.S.C. §1983. The parties agreed that Lamar was the prevailing party and entitled to fees and costs, but the trial court failed to set an amount of fees and costs. The appellate court held that without an award of fees, there was no final appealable order pursuant to S.Ct. Rule 304(a). The appeal was untimely, and the appellate court dismissed the appeal for lack of jurisdiction. LaSalle National Bank Ass’n v. City of Oakbrook Terrace, 393 Ill.App.3d 905, 913 N.E.2d 130, 332 Ill.Dec. 535 (2d Dist. 2009), touches on a claim affecting billboards. This case is primarily a claimed “downzoning” case that is reviewed in §5.25 above. O. [5.44] Who Acts for the Condemnor? Attorneys for condemnors should counsel their clients regarding the role of representatives of the public body in condemnation matters. In the tax increment financing district cases in §5.6 above, the municipality was bringing the condemnation, but usually the developer is anxious to start the development and may get involved in the attempted acquisition of the property from the owner. In Village of Cary v. Trout Valley Ass’n, 282 Ill.App.3d 165, 667 N.E.2d 1082, 217 Ill.Dec. 689 (2d Dist. 1996), the developer was paying all of the acquisition costs and directing the condemnation action, yet the case crashed for failure to publish a notice. Often the municipality or state may seek to acquire property to give a developer access to property, as in Illinois State Toll Highway Authority v. DiBenedetto, 275 Ill.App.3d 400, 655 N.E.2d 1085, 211 Ill.Dec. 702 (1st Dist. 1995). DiBenedetto went off the track because Sears, the Village of Hoffman Estates, and the Illinois State Toll Highway Authority were all involved in attempts to acquire the condemned property. Different offers were made, and the owner claimed that negotiations were not in good faith, which is a prerequisite to a condemnation action. Early on, the public body bringing the condemnation action and its attorneys should designate the point person for all dealings with the owner. All offers, negotiations, and settlements should pass through the public body’s condemnation attorney(s). In Forest Preserve District of DuPage County v. Brown Family Trust, 323 Ill.App.3d 686, 753 N.E.2d 1110, 257 Ill.Dec. 484 (2d Dist. 2001), the forest preserve district sought to acquire land from the Brown family trust. The trust filed a traverse, a motion to dismiss, and a motion for summary judgment. The forest preserve district had passed an ordinance authorizing the executive director, staff, and attorneys to “take the necessary steps, either by negotiation or condemnation,” to acquire the land. 753 N.E.2d at 1113. The trust claimed in its traverse and summary judgment motions that the district did not have the right to delegate the power of condemnation to the executive director, staff, and attorneys. The trial court entered summary judgment for the trust, holding that the ordinance authorizing the condemnation proceedings was invalid in that the ordinance “improperly delegates the decision to condemn to the District’s attorneys and staff.” 753 N.E.2d at 1114. The appellate court reversed the trial court, holding that the ordinance was not an improper delegation of the district’s condemnation powers.



The adage that “too many cooks may spoil the broth” is true in condemnation. One person should be in charge, and it is recommended that this person should be an attorney who is well acquainted with all the mountains and pitfalls of the statutory scheme and caselaw of eminent domain. There will be a lot of questions as to the meaning and application of this program. The Illinois Department of Transportation has had policies and relocation programs in place for over 30 years. Relocation specialists are on IDOT staff in all of IDOTs’ district offices. Assistance and guidance from those relocation specialists are available. Private agencies are also available for those condemning bodies that do not have sufficient condemnations to warrant having a relocation specialist on staff. With the enactment of the Eminent Domain Act, other relocation services will crop up and be available with policies and guidelines already in place to assist the condemning bodies. P. [5.45] Forest Preserves and Easements Most public bodies with the power of eminent domain may seek easements instead of taking an entire fee. With more public pressure from antidevelopment and zero-growth groups, Illinois may see more acquisition of “development” easements. Owners are entitled to just compensation for the taking of an easement similar to a taking for a fee. The taking of an easement often results in claims of damage to the remainder of the property. A good discussion of the law of easements is found in Village of Round Lake v. Amann, 311 Ill.App.3d 705, 725 N.E.2d 35, 244 Ill.Dec. 240 (2d Dist. 2000). Round Lake was working with a developer to provide access to property held by a family trust. Amann and one other property owner (Pittelkow) claimed a prescriptive easement over the trust property. The prescriptive easement was a gravel driveway across the property that served only the two residential properties. The gravel driveway had been in place for over 70 years. The trust property was to be developed as residential and a public road built on the prescriptive easement. Amann and her neighbor claimed that if the easement were turned into a public highway, they would lose their seclusion and privacy. The appraiser for Amann and her neighbor opined that making the easement a public road would reduce the value of their respective properties by ten percent. The court awarded only nominal damages of $50 and granted the Village of Round Lake the right to have the developer build a public road and develop the property. The appellate court affirmed. In Benno v. Central Lake County Joint Action Water Agency, 242 Ill.App.3d 306, 609 N.E.2d 1056, 182 Ill.Dec. 522 (2d Dist. 1993), Benno brought an action against the water district for installing a water main beyond the public easement. The appellate court held that the owner had a right of action for trespass. Benno (a lawyer) should have brought an action for inverse condemnation in order to be entitled to reasonable attorneys’ fees and costs. Forest Preserve District of Kane County v. Estes, 222 Ill.App.3d 167, 583 N.E.2d 640, 164 Ill.Dec. 724 (2d Dist. 1991), touches on hiking/biking/jogging easements. This author believes that there will be more condemnation actions for trail easements as the state and nation develop a nationwide system of trails. Landowners will resist these types of trails, claiming a violation of their privacy and seclusion.



In Village of Fox River Valley Gardens v. Lake County Forest Preserve District, 224 Ill.App.3d 919, 586 N.E.2d 813, 166 Ill.Dec. 855 (2d Dist. 1992), suit was filed against the forest preserve district for declaratory judgment that the forest preserve district did not have the power to condemn property in Fox River Valley Gardens. The Illinois statute provides that municipal land may not be condemned without the prior approval of the municipality unless that land is “contiguous to an existing park or forest preserve.” 586 N.E.2d at 816, quoting 70 ILCS 805/6. The trial court dismissed the condemnation, and the forest preserve district appealed. The appellate court reversed, holding that a conveyance of a strip of land by the owner to the village would not frustrate and thwart the forest preserve district’s efforts to acquire the land by eminent domain. Q. [5.46] Parking Lots and Driveways Condemnation law is statutory, and many grants of the power of eminent domain are subject to a variety of requirements, purposes, and special provisions and restrictions. It is paramount that an attorney be completely versed in the statutory authority and the cases interpreting the condemnation authority before proceeding with a condemnation action. For example, in our motorized world, one would think that a county would have the right to condemn property for a parking lot near the courthouse. However, in County of DeKalb v. Smith, 213 Ill.App.2d 775, 572 N.E.2d 379, 157 Ill.Dec. 310 (2d Dist. 1991), the appellate court held otherwise. DeKalb County filed a condemnation action to acquire Smith’s commercial property across the street from the DeKalb County courthouse in Sycamore. Smith filed a traverse challenging the county’s right to condemn property for a parking lot. The trial court denied the traverse, and the case went to trial. After the verdict and the deposit of the award with the county treasurer, Smith’s commercial building was razed and the parking lot built. Smith appealed, and the appellate court held that Illinois counties have not been granted the power of eminent domain for the acquisition of land for parking lots. Now DeKalb County had a problem. The county had wrongfully taken the Smith property, razed the buildings, and paved the parking lot. The problem was solved by paying Smith her asking price for the property. In McHenry County Building Commission v. Harvard State Bank, No. 90 ED 4 (McHenry Cty.Cir.) (Rule 23), aff’d, No. 2-93-1114 (2d Dist. 1994) (Rule 23), McHenry County was faced with the same parking problem at its courthouse in Woodstock. McHenry County had established a public building commission pursuant to 50 ILCS 20/1, et seq. The legislature had specifically granted public building commissions the power of eminent domain to acquire private land for parking to serve their public buildings. When the McHenry County Building Commission filed condemnation proceedings to acquire land across the road from the courthouse for parking, the owners (Klehm Nursery) filed a traverse challenging the commission’s right to condemn, citing Smith, supra. The trial court denied the traverse, and the matter proceeded to trial. On appeal, the court in a S.Ct. Rule 23 decision affirmed the denial of the traverse, holding that the legislature had granted the Commission the power to acquire the parking lot. A county has the right to condemn for a jail. Mercer County v. Wolff, 237 Ill. 74, 86 N.E. 708 (1908). It would seem that parking lots are as important to a county as its jail. If the state legislature has not granted the power of condemnation to the local body for what may seem a proper governmental function, a traverse dismissing the case will be granted.



In addition to finding places to park cars in parking lots, there is the ongoing attempt by public bodies, at both the state and local levels, to limit driveway and curb cuts. Loss of access is subject to just compensation. See Department of Transportation v. Chicago Title & Trust Co., 303 Ill.App.3d 484, 707 N.E.2d 637, 236 Ill.Dec. 510 (1st Dist. 1999). The tollway takes access on the main line as well as its approaches. Owners and developers continue to seek more driveways as population and development increases. Good traffic engineering continues to require driveways be built farther and farther away from major intersections. In Key Outdoor, Inc. v. Illinois Department of Transportation, 322 Ill.App.3d 316, 750 N.E.2d 709, 255 Ill.Dec. 792 (4th Dist. 2001), an outdoor sign company was denied a commercial driveway permit, and the appellate court affirmed. The state, many counties, and many municipalities have definite written policies regarding driveway access to streets and highways. Most local governments follow closely guidelines set out in the Illinois Department of Transportation’s Policy on Permits for Access Driveways to State Highways. 92 Ill.Admin. Code pt. 550. In addition to curb cuts, most local governments (as well as the state) have standards for the grades of driveways and approaches to streets and highways. When a public road or street is widened and the driveway is cut back, the driveway may become a steeper grade if the abutting property is above or below the grade of the adjoining street. Many property owners will claim this greater difference in grade as damages to the remainder of the property if the new grade deviates from good traffic engineering standards. Condemnees and condemnors should consider retaining qualified traffic engineers to advise them on these possible claims. VI. [5.47] CONCLUSION Attorneys for condemnors and condemnees, when considering a condemnation, should take the following steps: (a) read and thoroughly understand the statute and supporting caselaw, read the Eminent Domain Act, and follow the changes in this law; (b) develop a definite plan; (c) retain qualified opinion witnesses to advise the parties on valuation, engineering, and any technical aspects of the project; and (d) treat the owner fairly at all stages and attempt to acquire the property sought at the fair market value at its highest and best use. Following these simple rules will avoid a dismissal of the proceedings. The owner will be justly compensated, the project will be promptly built, and the public body will not be assessed with the owner’s costs and expenses for the condemnation action being dismissed. Attorneys should not take any past legal position for granted. The courts change with the times. Newer judges may see an issue in a different light, particularly with the tightening of public budgets and increase in taxes. More deference and protection have been given to landowners’ rights. The downturn in the economy has impacted condemnation for both public bodies and landowners. Legislation will be enacted in the future changing condemnation laws. New and old legislation will be challenged and either upheld or overturned. There will be plenty of future opportunities for attorneys in this ever-changing field.


Pretrial Procedure LEO N. CINQUINO Righeimer Martin & Cinquino, P.C. Chicago

6



I. [6.1] Scope of Chapter II. Initial Preparation A. [6.2] Owner’s Attorney 1. [6.3] Traverse and Motion To Dismiss 2. [6.4] Owner’s Acquisition 3. [6.5] Property Uses 4. [6.6] Documents, History, and Experts 5. [6.7] Offers To Purchase 6. [6.8] Other Litigation, Tax Assessment, or Appraisal 7. [6.9] Owner’s Plans for the Property 8. [6.10] Owner’s Offer To Sell Property 9. [6.11] Materials Received from Condemning Authority; Sample Notice To

Produce at Quick-Take 10. [6.12] Sales of Properties in Area 11. [6.13] Leasehold Interests or Other Encumbrances 12. [6.14] Environmental Contamination 13. [6.15] Precondemnation Offer 14. [6.16] In Summary B. [6.17] Condemnor’s Attorney C. [6.18] Determining the Types of Opinion Witnesses Needed D. [6.19] Factors in Selecting a Valuation Consultant or Witness III. Quick-Take Proceedings A. [6.20] Owner’s Attorney B. [6.21] Condemnor’s Attorney C. [6.22] Withdrawal of the Quick-Take Award IV. Discovery A. [6.23] Supreme Court Rules Regarding Discovery B. [6.24] Interrogatories Under S.Ct. Rule 213 C. [6.25] Discovery in Addition to S.Ct. Rule 213 D. [6.26] Use of Interrogatories E. [6.27] Deposition of Valuation Witnesses F. [6.28] Discovery Outline

PRETRIAL PROCEDURE


V. Pretrial Motions and Issues A. [6.29] Issues of Title B. [6.30] New Valuation Date C. [6.31] Leasehold Interest D. [6.32] Damage to the Remainder E. [6.33] Bill of Particulars F. [6.34] Inspection of Real Estate; Sample Agreed Protective Order G. [6.35] Motion in Limine H. [6.36] Case Management Conference I. [6.37] Offers To Settle Before Trial J. [6.38] Pretrial Appeals



I. [6.1] SCOPE OF CHAPTER This chapter provides information regarding the initial steps in preparing to handle an eminent domain case, examines the options available at a quick-take hearing, reviews available discovery, and discusses some pretrial motions that can be made. The eminent domain practitioner is urged to review carefully the Eminent Domain Act, 735 ILCS 30/1-1-1, et seq., which became effective January 1, 2007, and applies to complaints to condemn filed after that date. Among other differences, the Eminent Domain Act changed the burden of proof to show need and necessity for a municipality with regard to a taking for economic development. Given the economic downturn from 2006 to 2008 there have been few new tax-increment financing (TIF) areas that need to be analyzed by an owner’s attorney. II. INITIAL PREPARATION A. [6.2] Owner’s Attorney Most landowners are misinformed as to their rights and as to the government’s power in an eminent domain proceeding. At the initial client interview, the attorney should be prepared to inform the landowner as to what “fair cash market value” means in terms of an eminent domain proceeding. Landowners generally have a preconceived idea as to the value of their property. However, in some instances, the owner’s concept of value includes elements that are non-compensable in an eminent domain proceeding. A review of other chapters in this handbook will illustrate the many methods and elements of value commonly used by real estate people or landowners that may not be proper in an eminent domain proceeding. The attorney should be prepared to distinguish what is and what is not compensable in an eminent domain proceeding. If the condemnor is the Illinois Department of Transportation (IDOT) or another body with the power of quick-take, the attorney should be prepared to inform the client regarding quick-take. See §§6.20 – 6.22 below and Chapter 4 of this handbook. An early decision must be made as to the position the landowner will take regarding quick-take. If the owner is a small business person who will need funds to begin a new operation, the owner’s attorney must begin preparing for a quick-take hearing immediately. In a partial-take case this requires hiring a competent eminent domain engineer to analyze the IDOT (or other condemning authority) plans to form a basis for determining damage to the remainder. A valuation witness cannot properly evaluate damage to the remainder or issues such as loss of parking, difficult access, drainage, or nonconforming use without an engineering report. A difficult issue exists for an owner’s attorney regarding a small partial taking. Remember an owner can only recover damages to the remainder at this time and not after the case is complete after the owner accepts the original offer. If, during the initial negotiations IDOT pronounces certain remedies for damage to the remainder, those representations are not binding on IDOT. See Department of Transportation v. Western National Bank of Cicero, 63 Ill.2d 179, 347 N.E.2d 161, 164 – 165 (1997).

PRETRIAL PROCEDURE §6.2


PRACTICE POINTER

If an attorney agrees to represent an owner in this type of case, the author recommends

(1) informing the owner in writing that there is an issue of damage to the remainder that cannot be fully explored without filing suit and obtaining IDOT plans by court order; and (2) hiring an engineer to review the IDOT plans. This is in no way an attack on IDOT or its negotiators. The author has never experienced an intent to deceive by IDOT, but mistakes and changes in construction plans can occur. In the author’s recent experience there are more construction plan changes than in past years.

A successful eminent domain proceeding requires teamwork among the attorney, the owner, and the experts. While the landowner is usually not aware of the legal implications of an eminent domain proceeding, he or she usually does know a great deal about the property and the surrounding area. One key to success in eminent domain litigation is an intimate familiarity with the subject property. A thorough discussion and view of the property with the client is very important. In the initial interview of the owner, the attorney should cover the following points: Attorney’s compensation. If a contingent fee is agreed on, it must be in writing. If interest payments by the condemnor are to be part of the contingency, this should be spelled out. Since abandonment is always possible, the contract should include an hourly rate if final just compensation is not paid and the case is abandoned. Keep hourly records daily to insure payment after abandonment. The unique right of a condemnor to abandon, even after a jury verdict (except if there is a quick-take and the condemnor takes possession), should be explained to the client. Key information. If the owner has recently purchased the property be sure to get 1. the contract for purchase; 2. the closing documents; and 3. a detailed list of changes to the subject since purchase (e.g., new improvements,

extension of utilities, annexation and zoning, dramatic changes in the area, unusual circumstances (such as was the client the leasee when the purchase occurred)).

It is very important to know this key evidence in order to make the best argument to keep the purchase price out of evidence. Also, this information is critical to give to the owner’s valuation witness. The owner has the facts; it is the job of the owner’s attorney to compile the facts to make the best case possible and to give these facts to the owner’s experts. Offers to purchase the subject property. The owner’s attorney should be very thorough from the beginning in analyzing pending offers. Points to consider include the following: 1. Was the offeror capable of purchasing the property?



2. What are the contingences in the offer? 3. Was the offer made in good faith?

PRACTICE POINTER

Attorneys have an obligation to check out all evidence. There is potential for an offer to have been manufactured high or low, and if that is the situation, no reliance should be placed in the offer.

Specific and detailed questions for discussion at the initial client interview should include the points covered in §§6.3 – 6.15 below. 1. [6.3] Traverse and Motion To Dismiss Does the owner want to attempt to defeat the taking through a traverse and motion to dismiss? A general traverse may be sufficient to challenge the plaintiff’s authority to condemn and need not conform to all of the pleading requirements of the Code of Civil Procedure, 735 ILCS 5/1-101, et seq. Forest Preserve District of DuPage County v. Miller, 339 Ill.App.3d 244, 789 N.E.2d 916, 923 – 924, 273 Ill.Dec. 742 (2d Dist. 2003) (note that this traverse was filed pro se). Counsel should be aware of the apparently limited scope of judicial review of even an excessive taking (see City of Elgin v. Elgin National Bank, 174 Ill.App.3d 1061, 529 N.E.2d 639, 124 Ill.Dec. 658 (1st Dist. 1988)) and the broad definition of a “public purpose.” However, note that the Eminent Domain Act, effective January 1, 2007, provides that “a condemning authority may not take or damage property by the exercise of eminent domain unless it is for a public use, as set forth in this Section.” 735 ILCS 30/5-5-5(a). See also 735 ILCS 30/5-5-5(b) through 30/5-5-5(e). In Southwestern Illinois Development Authority v. National City Environmental, L.L.C., 199 Ill.2d 225, 768 N.E.2d 1, 263 Ill.Dec. 241 (2002), aff’g 304 Ill.App.3d 542 (5th Dist. 1999), Southwestern Illinois Development Authority (SWIDA) sought to acquire the 148.5-acre subject property owned by the defendant pursuant to quick-take. The subject property was adjacent to a racetrack owned by Gateway International Motorsports Corporation and was needed to accommodate additional parking for the racetrack. The county board approved the use of quick-take, adopting a resolution finding that the parking facility was needed and necessary. SWIDA held a public meeting and adopted a resolution like the county’s resolution. SWIDA entered into an agreement with Gateway to convey the property after its acquisition. The trial court denied the traverse and motion to dismiss and also denied the motion to strike the quick-take. At the hearing, Gateway testified that it was cheaper to acquire the property by eminent domain than to build a parking structure. The court held that SWIDA exceeded the boundaries of constitutional principles and its authority by transferring the property to a private party for a profit when the property was not put to a public use. The court found no public use although SWIDA argued that the taking fostered



economic development, the promotion of public safety, and the prevention or elimination of blight. SWIDA also argued that there is no distinction between “public purpose” and “public use” and that the proper test is simply to ask whether a public purpose is served by the taking. The court stated that a public use requires that the public must be, to some extent, entitled to use or enjoy the property — not as a mere favor or by permission of the owner, but by right. The court distinguished cases dealing with the elimination of blight or slums or in which there were public safety concerns. See also Southwestern Illinois Development Authority v. Al-Muhajirum, 318 Ill.App.3d 1005, 744 N.E.2d 308, 253 Ill.Dec. 26 (5th Dist. 2001). The court stated that the facts of National City Environmental, supra, did not satisfy the public-use requirement, especially in light of evidence that Gateway could have built a public garage on its existing property. While recognizing that economic development is an important public purpose, the court stated that to constitute a public use, something more than a mere benefit to the public must flow from the contemplated improvement. See City of Chicago v. Midland Smelting Co., 385 Ill.App.3d 945, 896 N.E.2d 364, 368, 324 Ill.Dec. 578 (1st Dist. 2008), which distinguishes and explains National City Environmental in denying a traverse. National City Environmental has not yet been interpreted; therefore, it is unclear whether the courts will give it a broad or narrow interpretation. A broad interpretation could eliminate many condemnation cases. National City Environmental does not hold that an admission fee charged to the public eliminates a public purpose. See Friends of the Parks v. Chicago Park District, 203 Ill.2d 312, 786 N.E.2d 161, 271 Ill.Dec. 903 (2003). The subsequent transfer of property to a private entity does not transform a taking for public use into a taking for private use. Kelo v. City of New London, Connecticut, 545 U.S. 469, 162 L.Ed.2d 439, 125 S.Ct. 2655 (2005). See also Hawaii Housing Authority v. Midkiff, 467 U.S. 229, 81 L.Ed.2d 186, 104 S.Ct. 2321 (1984); Berman v. Parker, 348 U.S. 26, 99 L.Ed. 27, 75 S.Ct. 98 (1954); People ex rel. Adamowski v. Chicago Railroad Terminal Authority, 14 Ill.2d 230, 151 N.E.2d 311, 314 – 315 (1958); Illinois State Toll Highway Commission v. Eden Cemetery Ass’n, 16 Ill.2d 539, 158 N.E.2d 766 (1959); People ex rel. City of Urbana v. Paley, 68 Ill.2d 62, 368 N.E.2d 915, 921, 11 Ill.Dec. 307 (1977). But see 735 ILCS 30/5-5-5(b) through 30/5-5-5(e). Furthermore, nowhere in National City Environmental does the Illinois Supreme Court require that the public must have access to all parts of a project to qualify as a valid public use. The National City Environmental court stated that it did not require a bright-line test to determine whether the taking lacks a showing of public purpose. 768 N.E.2d at 10. The condemning body must make a reasonable attempt to agree, and, if it has an appraisal, the offer may have to be based on that appraisal. City of Naperville v. Old Second National Bank of Aurora, 327 Ill.App.3d 734, 763 N.E.2d 951, 261 Ill.Dec. 702 (2d Dist. 2002). Good-faith negotiations may be challenged in an interlocutory appeal. State agencies, such as the Department of Transportation, must send a letter of offer at least 60 days before filing suit. If the taking is



amended to either increase the area to be acquired or decrease the compensation to be paid, then the state agency must wait another 60 days before filing suit. Department of Transportation ex rel. People v. 151 Interstate Road Corp., 209 Ill.2d 471, 810 N.E.2d 1, 284 Ill.Dec. 384 (2004). The condemning body may delegate negotiations, settlement with the owners, and filing a complaint to condemn if a settlement is not reached. Forest Preserve District of DuPage County v. Brown Family Trust, 323 Ill.App.3d 686, 753 N.E.2d 1110, 257 Ill.Dec. 484 (2d Dist. 2001). The enabling ordinance must adequately describe the property to be condemned. Miller, supra. In Miller, the plaintiff sought to pass a second ordinance with the proper legal description in conformance with the amended complaint after the posttrial motion was filed. The court found that the subsequent ordinance did not cure the insufficiencies of the first ordinance on which the complaint to condemn was based. The plaintiff is not required under 735 ILCS 30/10-5-5 to cite every statute granting the authority to condemn the property in its complaint. See Trotter v. Spezio, 349 Ill.App.3d 959, 812 N.E.2d 577, 285 Ill.Dec. 757 (3d Dist. 2004). In Board of Education, Pleasantdale School District No. 107, Cook County, Illinois v. Village of Burr Ridge, 341 Ill.App.3d 1004, 793 N.E.2d 856, 276 Ill.Dec. 97 (1st Dist. 2003), a school district successfully challenged a municipality’s tax-increment financing by filing a complaint for injunctive relief. The trial court found that obsolete platting, diversity of ownership, flooding, and tax delinquencies did not apply, and there was no error in the trial court’s consideration of new developments in the TIF area that occurred without TIF funding. Any challenge to the condemnor’s authority to condemn must be filed in a timely fashion and cannot be raised for the first time on appeal. Board of Trustees of University of Illinois v. Shapiro, 343 Ill.App.3d 943, 799 N.E.2d 383, 278 Ill.Dec. 665 (1st Dist. 2003). There is a very limited review on IDOT’s acquisition for highway purposes. See Department of Public Works & Buildings v. Lewis, 411 Ill. 242, 103 N.E.2d 595, 599 (1952). The client should know that it is virtually impossible to have a court find that IDOT’s plans are so abusive that the case will be dismissed. At most IDOT’s taking can be delayed for technical issues such as bona fide attempt to agree, etc. It is highly unlikely that the owner will permanently defeat an IDOT taking. 2. [6.4] Owner’s Acquisition When and how did the owner acquire the subject property? Under certain circumstances, the purchase price may be admissible. Department of Conservation v. Aspegren Financial Corp., 72 Ill.2d 302, 381 N.E.2d 231, 21 Ill.Dec. 153 (1978). But see Illinois State Toll Highway Authority v. Grand Mandarin Restaurant, Inc., 189 Ill.App.3d 355, 544 N.E.2d 1145, 136 Ill.Dec. 370 (2d Dist. 1989); Illinois State Toll Highway Authority v. American National Bank & Trust Company of Chicago, 236 Ill.App.3d 696, 606 N.E.2d 147, 179 Ill.Dec. 315 (2d Dist. 1992), aff’d in part, rev’d in part on other grounds, 162 Ill.2d 181 (1994).



3. [6.5] Property Uses What uses have been and are being made of the property? Counsel must remember, though, that a property is valued at its highest and best use, which may be a use other than the present use. Department of Public Works & Buildings v. Lambert, 411 Ill. 183, 103 N.E.2d 356 (1952). Generally, highest and best use is a question of fact for the jury. However, a witness’s testimony as to highest and best use may be so improbable that it should be excluded from the jury. City of Quincy, Illinois v. Diamond Construction Co., 327 Ill.App.3d 338, 762 N.E.2d 710, 714 – 715, 261 Ill.Dec. 141 (4th Dist. 2002). 4. [6.6] Documents, History, and Experts What maps, plats, aerial photographs, land use studies, engineering studies, and soil borings does the owner have? What is the history of the property and the surrounding area in terms of development, land use, sales, etc.? What real estate people or experts such as engineers or land planners does the owner feel have some unique knowledge about the property or area? 5. [6.7] Offers To Purchase Have any offers been made to purchase the property? The Illinois Supreme Court has held that offers are admissible only if there are no comparable sales in the area and if the offers were bona fide and made before the property was designated for acquisition. City of Chicago v. Lehmann, 262 Ill. 468, 104 N.E. 829 (1914). See also City of Chicago v. Anthony, 136 Ill.2d 169, 554 N.E.2d 1381, 144 Ill.Dec. 93 (1990); City of Chicago v. Blanton, 15 Ill.2d 198, 154 N.E.2d 242 (1958); Department of Public Works & Buildings v. Lambert, 411 Ill. 183, 103 N.E.2d 356 (1952); Jefferson Park District v. Sowinski, 336 Ill. 390, 168 N.E. 370 (1929). Appellate courts have also so held. Illinois State Toll Highway Authority v. Dicke, 208 Ill.App.3d 158, 566 N.E.2d 1003, 153 Ill.Dec. 153 (2d Dist. 1991); Department of Public Works & Buildings of State of Illinois ex rel. People v. Lankford, 65 Ill.App.2d 133, 212 N.E.2d 14 (4th Dist. 1965). However, offers made by the present owner to purchase the subject property are admissible as an admission against interest. Lake County Forest Preserve District v. O’Malley, 96 Ill.App.3d 1084, 421 N.E.2d 980, 52 Ill.Dec. 117 (2d Dist. 1981). In County of St. Clair v. Wilson, 284 Ill.App.3d 79, 672 N.E.2d 27, 219 Ill.Dec. 712 (5th Dist. 1996), the court held that bona fide offers to purchase adjacent property similar in size, location, and use to the subject property were admissible. All experts had testified that such offers were the type of evidence they would have considered in forming their opinions of value. Based on Federal Rules of Evidence 703 and 705, the court held that such offers are admissible and are not contingent on the presence or absence of comparable sales. However, the offers must be bona fide. 6. [6.8] Other Litigation, Tax Assessment, or Appraisal Has any other litigation, such as attempts at rezoning, occurred that may affect the property? Have there been any attempts to lower the tax assessment? Have any appraisals been made of the property? When requested by the owner, the state must produce the appraisal on which it based its offer. Department of Transportation ex rel. People v. Hunziker, 342 Ill.App.3d 588, 796 N.E.2d 122,



277 Ill.Dec. 407 (3d Dist. 2003). But see Department of Transportation of State of Illinois v. Tucker, 366 Ill.App.3d 739, 853 N.E.2d 749, 304 Ill.Dec. 672 (3d Dist. 2006), which appears to overrule Hunziker. 7. [6.9] Owner’s Plans for the Property What plans does the owner have for the property? Market value, not the value to the owner for his or her purposes, is the measure of compensation (Peoples Gas Light & Coke Co. v. Buckles, 24 Ill.2d 520, 182 N.E.2d 169, 176 (1962)), but the owner’s plan may represent the highest and best use. The attorney should recognize, however, that the owner’s proposed use and value may need to be adapted to fit the existing rules of valuation. 8. [6.10] Owner’s Offer To Sell Property Has the owner ever offered the property for sale? An offer could be an admission against interest if a higher value is sought at trial. Williamson County v. Brock, 367 Ill. 159, 10 N.E.2d 654, 655 (1937). 9. [6.11] Materials Received from Condemning Authority; Sample Notice To Produce

at Quick-Take Have materials such as sales, plats, appraisals, or redevelopment plans been received from the condemning authority? Plans for the proposed public use are critical if the case involves a partial taking and damage to the remainder. Counsel should serve the Supreme Court Rule 213 interrogatories and request to produce when filing the appearance. Before the quick-take hearing, counsel should request that the engineer be present with the plat of taking and the plans. Below is a sample notice to be served on the plaintiff’s attorney. [City], ) a municipal corporation, ) Plaintiff, ) ) v. ) Case No. ____ ) [Landowner], et al., ) Defendants. )

NOTICE TO PRODUCE AT QUICK-TAKE TO: [Plaintiff’s attorney] YOU ARE HEREBY NOTIFIED to produce [name of person to produce] or the plaintiff’s engineer at the quick-take hearing in this matter together with the following:



1. the full-scale drawing of the plat of taking and the engineering with regard to the subject property;

2. the construction plans regarding the subject property; 3. any surveys, aerials, and photos of the subject property; 4. any appraisals of the subject property; 5. any letters of offer; and 6. any Minutes of Condemnation. This notice is pursuant to Supreme Court Rule 237. [defendant’s name] By: ___________________________________ Attorneys for Owners 10. [6.12] Sales of Properties in Area Does the owner know of any sales of properties in the area? The test for admissibility of sales evidence appears to be whether it is reasonably relied on by experts in the field and not excluded by eminent domain law. City of Chicago v. Anthony, 136 Ill.2d 169, 554 N.E.2d 1381, 144 Ill.Dec. 93 (1990). 11. [6.13] Leasehold Interests or Other Encumbrances Are there any leasehold interests or other encumbrances on the title? An owner of an off-premises outdoor advertising sign is entitled to compensation. See Department of Transportation v. Drury Displays, Inc., 327 Ill.App.3d 881, 764 N.E.2d 166, 261 Ill.Dec. 875 (5th Dist. 2002). 12. [6.14] Environmental Contamination Is the owner aware of any environmental contamination on the property? In Department of Transportation ex rel. People v. Parr, 259 Ill.App.3d 602, 633 N.E.2d 19, 198 Ill.Dec. 557 (3d Dist. 1994), the court held that, absent adherence to the administrative procedure under the Environmental Protection Act, 415 ILCS 5/1, et seq., for recovery of environmental remediation costs, the condemning body cannot introduce evidence of remediation costs at an eminent domain proceeding. But see 735 ILCS 30/10-5-50 stating that proof of any violation of any environmental law or regulation, its effect on the fair market value of the property, and the cost of compliance are admissible as evidence in a trial on just compensation. NOTE: Whether or not this evidence is admissible, it is important to review any environmental report that exists.



13. [6.15] Precondemnation Offer Is there a precondemnation offer? Evaluate the precondemnation offer if there is one. If there is a partial take, determine whether the condemnor has offered damage to the remainder, and, if so, identify the elements of these damages. 14. [6.16] In Summary Some elements of damage to the remainder are obvious such as the taking of access rights, bisection of the property leaving uneconomic remnants, or a material change in size or shape. Some elements of damage to the remainder cannot be analyzed without a complete set of the condemnor’s construction plans. More difficult issues involve drainage, reduced or relocated driveways, nonconforming use, loss of parking, and traffic flow through the remainder. Given the current real estate market, the owner’s attorney should carefully analyze the value of the land taken as set forth in the initial offer. Both in a rapidly rising market and in an uncertain market, the assistance of a valuation expert many be necessary at the initial analysis of the offer. Recommending a settlement without a supporting valuation consultation may not be the best approach. The owner should be encouraged to tell counsel everything about the property, good or bad. The attorney must know as much as possible about the property, and the owner is an excellent source of direct information and leads to other people with information. Be sure to pass all information, good or bad, to the owner’s experts. B. [6.17] Condemnor’s Attorney The condemnor’s attorney also must learn about the subject property. At the initial stage, the condemnor’s attorney ordinarily will not interview the owner (although the owner’s deposition can be taken once the suit is filed) but will usually receive appraisals from the condemning authority that have been prepared in anticipation of the condemnor’s offer to purchase. (An attempt to agree is required by 735 ILCS 30/10-5-10.) The public body will have maps, plats, photographs, construction plans, and sales information. The condemnor’s attorney should review these materials and should view the subject property with the appraiser. If the case involves a partial taking and/or the construction of a public improvement, the attorney should meet with the engineer for the condemnor to review the plans for the improvement. The appraiser should be present at a meeting with the engineer to make sure the appraisal is based on the latest plans for the improvement. A checklist for the condemnor’s attorney at the initial stage includes the following steps: 1. Review the written appraisal, map, plats, and studies. 2. Meet with the appraiser and engineer to review the plans for the improvement. 3. Inspect the property with the appraiser and the engineer.



4. View sales used in the appraiser’s report. 5. Check out the facts in the appraisal (size, take, improvement, zoning, etc.) to make sure they are correct. Forest Preserve District of DuPage County v. Miller, 339 Ill.App.3d 244, 789 N.E.2d 916, 923 – 924, 273 Ill.Dec. 742 (2d Dist. 2003). 6. Check the legal description in the pleadings against that in the parcel plat. Also check the legal description contained in the parcel plat. Both a legal description and a plat can be used in defining a tax-increment financing area. City of Marseilles v. Radke, 307 Ill.App.3d 972, 718 N.E.2d 1052, 241 Ill.Dec. 198 (3d Dist. 1999). 7. Check the legal description in the enabling ordinance (if the condemnor is not an agency of the State). Illinois State Toll Highway Authority v. DiBenedetto, 275 Ill.App.3d 400, 655 N.E.2d 1085, 211 Ill.Dec. 702 (1st Dist. 1995). Furthermore, the condemnor’s attorney must be prepared in the event a traverse is filed at the quick-take. If it is, the issues in the traverse must be tried first. See Department of Public Works & Buildings of State of Illinois ex rel. People v. Neace, 13 Ill.App.3d 982, 301 N.E.2d 509 (2d Dist. 1973). A condemnor’s attorney must have evidence of need and necessity (a certified copy of an ordinance) and a bona fide attempt to agree. In People ex rel. Department of Transportation v. Kotara, L.L.C., 379 Ill.App.3d 276, 884 N.E.2d 1235, 318 Ill.Dec. 964 (3d Dist. 2008), the trial court was reversed and the quick-take order set aside because the owner was improperly restricted in attempting to prove that a bona fide attempt to agree was not made. Note that if the taking is for economic redevelopment, the burden of proof may change. See 735 ILCS 30/5-5-5(b) through 30/5-5-5(e). The attempt must be made in good faith. See Forest Preserve District of Will County v. Marquette National Bank, 208 Ill.App.3d 823, 567 N.E.2d 635, 153 Ill.Dec. 677 (3d Dist. 1991); City of Naperville v. Old Second National Bank of Aurora, 327 Ill.App.3d 734, 763 N.E.2d 951, 261 Ill.Dec. 702 (2d Dist. 2002). The offer on a full taking may also need to include relocation costs under 735 ILCS 30/10-5-62. A condemnor’s attorney may also have to prove that all requirements under the statute have been fulfilled. See Village of Cary v. Trout Valley Ass’n, 282 Ill.App.3d 165, 667 N.E.2d 1082, 217 Ill.Dec. 689 (2d Dist. 1996). But see also City of Oakbrook Terrace v. LaSalle National Bank, 186 Ill.App.3d 343, 542 N.E.2d 478, 134 Ill.Dec. 299 (2d Dist. 1989). If representing a municipality, is it a home-rule entity? If it is not home rule, then an ordinance that conflicts with state law must fall. Hawthorne v. Village of Olympia Fields, 204 Ill.2d 243, 790 N.E.2d 832, 274 Ill.Dec. 59 (2003) (not eminent domain case). But see the Eminent Domain Act, in which the powers of a home-rule municipality are limited by the Act. C. [6.18] Determining the Types of Opinion Witnesses Needed An appraisal license from the State of Illinois is necessary for an expert to render an opinion of fair cash market value in a document entitled an appraisal. 225 ILCS 458/5-5(a). Also, an engineer must be a licensed professional engineer with the State of Illinois to render engineering opinions in Illinois. 225 ILCS 325/39(b)(4). However, these statutes alone are not grounds to bar



an engineer (and presumably a valuation expert) since it is up to the trial court to determine what type of expert will assist a jury. See Thompson v. Gordon, 221 Ill.2d 414, 851 N.E.2d 1231, 303 Ill.Dec. 806 (2006) (reversing trial court for barring engineer solely on 225 ILCS 325/39). After taking the steps listed in §6.17 above, the attorney should have some idea as to what issues will affect valuation in the case. Supreme Court Rule 201(b)(3) protects a party from having to disclose consultants’ opinions or their work product unless there is a showing of special hardship. The owner’s attorney may wish to delay consulting an opinion witness until after receiving an answer to a notice to produce and/or initial interrogatories. A review of the condemnor’s written appraisal, sales information, and construction plans may be helpful in the selection of opinion witnesses or consultants. Before retaining an opinion witness, the attorney must first decide which issues in the case require opinion testimony. In all cases, the attorney needs to consult a person familiar with valuation. Other opinion witnesses may be necessary. For example, if highest and best use or rezoning is at issue, a land planner may be necessary. An engineer may be necessary (1) to address issues such as availability of utilities, delineation of flood plain, size of parcel, reconstruction estimates, drainage, environmental factors, traffic flow, soil conditions, or parking; or (2) to review the plan for the proposed public improvement. If the existence or size of wetlands is at issue, it is necessary to hire an expert in that area to testify and consult with the valuation witnesses. In Department of Transportation v. LaSalle National Bank, 251 Ill.App.3d 901, 623 N.E.2d 390, 191 Ill.Dec. 145 (2d Dist. 1993), the court held that it is for the jury to determine the extent of wetlands on the subject property in arriving at an opinion of final just compensation. See Solid Waste Agency of Northern Cook County v. United States Army Corps of Engineers, 531 U.S. 159, 148 L.Ed.2d 576, 121 S.Ct. 675 (2001) (narrows use of “Migratory Bird Rule” when wetlands may be one issue). The revisions to the Federal Rules of Civil Procedure that took effect on December 1, 2006, provided for discovery of electronically stored information. At present, the Illinois Supreme Court Rules do not specifically address this issue. It is well to remember that there is no privilege with regard to an attorney’s communication with an expert or the expert’s notes. One commentator has suggested placing a legend on all notes, stating:

THESE NOTES ARE INCOMPLETE AND HAVE BEEN PREPARED FOR PERSONAL USE ONLY. NO ONE MAY RELY ON THEM FOR ANY PURPOSE. ALL VIEWS ARE SUBJECT TO CHANGE AS ADDITIONAL INFORMATION BECOMES AVAILABLE OR IS CLARIFIED. Gregory P. Joseph, Engaging Experts, Nat’l L.J., Apr. 18, 2005, at 12, www.josephnyc.com/articles/viewarticle.php?24.

D. [6.19] Factors in Selecting a Valuation Consultant or Witness Illinois courts apply liberal standards in determining who may give an opinion of value. A witness does not have to be an “expert” or even engaged in buying and selling land to give an opinion of value. Department of Public Works & Buildings v. Bohne, 415 Ill. 253, 113 N.E.2d 319, 325 (1953). These liberal standards give an attorney wide leeway in selecting a valuation witness. In many instances, professional appraisers who have impressive qualifications and experience in condemnation matters may be helpful, especially if the case at hand involves

http://www.josephnyc.com/articles/viewarticle.php?24



complex elements of damage to the remainder. In a case involving valuation of a large tract of vacant land in an undeveloped area, a local broker who has sold similar land may be an important valuation witness or consultant. In selecting a valuation witness or consultant, some general factors to consider are 1. specific experience in the area of the subject property as an appraiser, broker, or

developer; 2. general background, experience, and qualifications (note that the statutes discussed in

§6.18 above should be considered and discussed with non-licensed valuation witnesses since possible criminal sanctions are included);

3. specific experience with the type of issues the case will involve; 4. professional reputation; and 5. experience as a witness. In order to select the best qualified witness or consultant, the attorney must be able to determine the issues in the case. Selection of witnesses should be made with the realization that a jury may be necessary. The attorney should consider what type of witness a jury will believe and what type of witness will fit his or her final argument. In Thompson v. Gordon, 221 Ill.2d 414, 851 N.E.2d 1231, 303 Ill.Dec. 806 (2006), the Supreme Court held that an expert witness testifying to engineering opinions does not need to be licensed by the state. The court overruled the previous decision in People v. West, 264 Ill.App.3d 176, 636 N.E.2d 1239, 201 Ill.Dec. 807 (5th Dist. 1994). West had held that licensing is a prerequisite to the admissibility of expert testimony, rather than a factor to be weighed in considering expert qualifications. The reasoning in Thompson is in line with the prior line of cases that held that anyone who is acquainted with the property being condemned and has knowledge of value, either in the sale or ownership of property nearby, is competent to testify, and the question of the degree of his or her experience is one of weight and not of competency. See Department of Public Works & Buildings v. Pellini, 7 Ill.2d 367, 131 N.E.2d 55, 57 – 58 (1955); Trustees of Schools of Township No. 44 v. Kirane, 5 Ill.2d 64, 124 N.E.2d 886, 888 – 889 (1955); City of Chicago v. Vaccarro, 408 Ill. 587, 97 N.E.2d 766 (1951); Forest Preserve Dist. of Cook County v. Kercher, 394 Ill. 11, 66 N.E.2d 873, 879 (1946); Department of Public Works & Buildings v. Diggins, 374 Ill. 11, 27 N.E.2d 826 (1940); Department of Public Works & Buildings v. Foreman State Trust & Savings Bank, 363 Ill. 13, 1 N.E.2d 75, 79 (1936); Kankakee Park Dist. v. Heidenreich, 328 Ill. 198, 159 N.E. 289 (1927); Illinois State Toll Highway Authority v. Humphrey Estate, 62 Ill.App.3d 316, 379 N.E.2d 626, 19 Ill.Dec. 754 (2d Dist. 1978); Department of Public Works & Buildings of State of Illinois ex rel. People v. American National Bank & Trust Co., 36 Ill.App.3d 439, 343 N.E.2d 686 (2d Dist. 1976). The trial court may exercise its discretion in barring the admission of an appraiser’s testimony. See Southwestern Illinois Development Authority v. Al-Muhajirum, 348 Ill.App.3d 398, 809 N.E.2d 730, 284 Ill.Dec. 164 (5th Dist. 2004) (trial court affirmed, no abuse of



discretion); City of Springfield, Illinois v. West Koke Mill Development Corp., 312 Ill.App.3d 900, 728 N.E.2d 781, 784 – 785, 245 Ill.Dec. 699 (4th Dist. 2000) (trial court affirmed for allowing appraisal testimony that did not use uniform value for entire property); Department of Transportation, State of Illinois v. Kelley, 352 Ill.App.3d 278, 815 N.E.2d 1214, 287 Ill.Dec. 411 (3d Dist. 2004) (trial court reversed for allowing appraisers to value different portions of whole property at different values); Board of Trustees of University of Illinois v. Shapiro, 343 Ill.App.3d 943, 799 N.E.2d 383, 278 Ill.Dec. 665 (1st Dist. 2003) (trial court affirmed for barring appraiser testimony when comparable sales were either under threat of condemnation or zoned differently); People ex rel. Department of Transportation v. Firstar Illinois, 365 Ill.App.3d 936, 851 N.E.2d 682, 303 Ill.Dec. 495 (2d Dist. 2006) (trial court’s refusal to reopen discovery on remand was affirmed when original appraiser had improperly relied on map).

PRACTICE POINTER

Always remember to give your valuation witness the reports from non-valuation experts. There is no point in having an engineer or land planner if the valuation witness does not consider the expert’s opinions. Also, give your valuation witness unfavorable nontestifying expert reports your client has in his or her possession and that will be turned over to your opponent. Nothing is worse than allowing your own expert to be surprised by cross-examination that you, as an attorney, should have anticipated. Expert reports obtained by your own client — that you have hidden from your expert — are much more dangerous when the valuation witness has no prepared answer to the coming cross.

III. QUICK-TAKE PROCEEDINGS A. [6.20] Owner’s Attorney Prior to commencement of discovery, certain condemnors have a right to exercise the power of quick-take. See Chapter 4 of this handbook; 735 ILCS 30/25-7-103.1, et seq.; Department of Transportation of State of Illinois ex rel. People v. Collins, 69 Ill.App.3d 269, 387 N.E.2d 6, 25 Ill.Dec. 549 (3d Dist. 1979). At the quick-take, the condemnor must prove not only the necessity of the condemnation but also that it is necessary to use the quick-take procedure. Times Mirror Cable Television of Springfield, Inc. v. First National Bank of Springfield, 221 Ill.App.3d 340, 582 N.E.2d 216, 164 Ill.Dec. 8 (4th Dist. 1991). If the owner wants to contest the condemnor’s right to acquire its property by filing a traverse and motion to dismiss, this pleading must be filed prior to the quick-take hearing since in that hearing the court determines the condemnor’s right to acquire the property. Department of Transportation of State of Illinois ex rel. People v. Roodhouse, 104 Ill.App.3d 880, 433 N.E.2d 703, 60 Ill.Dec. 661 (4th Dist. 1982). If the owner does file a traverse and motion to dismiss, it is reversible error not to try that issue prior to the plaintiff’s quick-take. Department of Public Works & Buildings of State of Illinois ex rel. People v. Neace, 13 Ill.App.3d 982, 301 N.E.2d 509 (2d Dist. 1973). Quick-take gives the owner preliminary compensation for the taking of its property. If quick-take is not employed and the case proceeds to trial, the owner can lose possession of the property



without any payment if either party appeals the jury verdict. See 735 ILCS 30/10-5-80; Department of Public Works & Buildings, State of Illinois v. Forbeck, 118 Ill.App.2d 231, 254 N.E.2d 182 (3d Dist. 1969); County of Cook v. Malysa, 39 Ill.2d 376, 235 N.E.2d 598 (1968); Central Illinois Public Service Co. v. Gibbel, 65 Ill.App.3d 890, 382 N.E.2d 846, 22 Ill.Dec. 456 (4th Dist. 1978). The condemnor cannot appeal if it pays the jury verdict, and the condemnee cannot appeal if it withdraws the money deposited. When quick-take is used, the owner always retains the preliminary compensation until a final determination of just compensation. The question of what interest is applicable on the difference between the preliminary just compensation and final just compensation is for the jury if a jury demand is made by either party. Illinois State Toll Highway Authority v. American National Bank & Trust Company of Chicago, 162 Ill.2d 181, 642 N.E.2d 1249, 205 Ill.Dec. 132 (1994). In any event, the six-percent statutory rate set by the Eminent Domain Act, 735 ILCS 30/20-5-30, is not binding, and the owner can present evidence entitling it to a higher interest rate. Id. If the preliminary amount withdrawn by a party exceeds that party’s share of the final just compensation, the party will be required to return the difference with interest accruing from the date of the jury verdict. Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 157 Ill.2d 282, 626 N.E.2d 213, 193 Ill.Dec. 180 (1993). When faced with a quick-take, the owner can 1. simply attend the quick-take hearing and not contest the condemnor’s power, in effect,

making the hearing the beginning of the discovery process; 2. contest the taking generally; 3. contest the exercise of the power of quick-take; 4. at the discretion of the trial court (735 ILCS 30/20-5-10(c) states that “then the court shall

hear such evidence as it may consider necessary and proper for a preliminary finding of just compensation”), offer evidence as to the amount of preliminary compensation; or

5. request the trial court to appoint an independent appraiser or appraisers, which also is a

matter of judicial discretion. Heritage Standard Bank & Trust, supra. In determining what course to take, the following factors, among others, should be considered: 1. A valuation witness presented at this point may not be fully prepared, which may decrease the witness’s effectiveness at the trial on final compensation. 2. Contesting the value at the quick-take hearing will give the condemnor’s attorney an early view of the owner’s theory of the case. 3. The owner must return any amount by which the preliminary compensation withdrawn exceeds the final compensation due that owner. An unrealistically high quick-take award may make the ultimate settlement of the case more difficult.



4. As discussed above (see American National Bank & Trust, supra), interest on the difference between preliminary just compensation and final just compensation is for the jury to determine. While interest applies to the owner’s award from the date of possession (735 ILCS 30/20-5-30), the state receives interest only from the date of the jury verdict (Heritage Standard Bank & Trust, supra). 5. There will be added witnesses’ fees involved in contesting value at the quick-take. 6. In most counties, an eminent domain matter can be set for trial at an early date; therefore, a condemnor’s attorney may seek an early date instead of facing a high quick-take deposit. As pointed out above, this could ultimately hurt the owner since the condemnor can gain possession during the appeal of a jury verdict without the owner receiving any money. 7. There may not be time to put on a credible valuation case at the quick-take hearing. 8. The result of the quick-take cannot be put in evidence at the trial of final compensation. 735 ILCS 30/20-5-10(d). If the decision is to present evidence as to preliminary compensation, the owner’s attorney should present a valuation witness to give an opinion of fair cash market value and damage to the reminder. See Chapter 8 of this handbook on presenting valuation witnesses. If the decision is to present no evidence at the quick-take hearing, the owner’s attorney should attend anyway since he or she will probably have the opportunity to cross-examine the plaintiff’s appraiser and engineer and will gain an early prediscovery view of the government’s case and the exact nature of the public improvement. Most trial courts will also require the government to furnish to the owner a copy of its written appraisal and construction plans at the quick-take hearing. If the court appoints independent appraisers, they can testify at a subsequent trial, but their appointment by the court cannot be disclosed. In Southwestern Illinois Development Authority v. Al-Muhajirum, 348 Ill.App.3d 398, 809 N.E.2d 730, 284 Ill.Dec. 164 (5th Dist. 2004), the trial court did not abuse its discretion in striking the owners’ appraisals and barring expert opinions when the appraiser’s opinion was based on the value of the various improvements to the land that were planned in the future but had not been built. After the determination of preliminary just compensation and the deposit of the award with the county treasurer, upon entry of the appropriate order, the title vests in the condemnor. The owner’s attorney may delay the condemnor’s right to possession after vesting of title upon proof of undue hardship, but the owner may be required to pay rent for the period possession is withheld. 735 ILCS 30/20-5-15(b). B. [6.21] Condemnor’s Attorney The condemnor’s attorney has to produce evidence necessary to prove the statutory requirements for a quick-take. 735 ILCS 30/20-5-10(b). Ordinarily, this is accomplished by presenting the testimony of the condemnor’s real estate appraiser and condemnation engineer along with exhibits illustrating the construction plans for the project, the construction plans for the subject property, the parcel plat, and the proposed scheduling of the improvement.



After the attorney has filed the motion for quick-take and the date for the hearing has been set, he or she should notify the appraiser and condemnation engineer. It usually is necessary for the appraiser to update the opinion of value to the date the petition to condemn was filed. Some points for counsel to cover to ensure a smooth quick-take hearing include the following: 1. Review the improvement plans and quick-take exhibits. These exhibits should include the overall project plan, the part of the overall plan that involves the parcel in question, the parcel plat, and some evidence of the scheduling of the project to show the need for quick-take. See City of Chicago v. St. John’s United Church of Christ, 404 Ill.App.3d 505, 935 N.E.2d 1158, 1172 – 1173, 343 Ill.Dec. 930 (2d Dist. 2010). 2. Be sure that the appraiser has considered the latest plans for the improvement. The only way to be sure of this is to have the appraiser and engineer review the plans together. Any discrepancy between the plans used originally by the appraiser and those to be used at the quick-take hearing should be reflected in the appraiser’s updated appraisal. 3. Review the comparable sales the appraiser has considered. The court may want this type of collateral evidence to illustrate that the witness’s opinion is credible. 4. Check the size of the whole parcel, both the part taken and the remainder, as depicted in the engineer’s plans and exhibits. Be sure the appraiser uses the correct sizes in his or her quick-take testimony. Check these exhibits against the legal description used in pleadings. 5. If possible, The attorney should inspect the subject property with the engineer and appraiser to familiarize himself or herself and the witnesses with the property. This inspection will also ensure that no major changes have occurred to the property between the date of the original appraisal and the date of valuation. If any changes have occurred, the appraiser should consider them in an updated appraisal. If exhibits are marked prior to hearing and if the attorney, engineer, and appraiser are all prepared, the condemnor’s case at a quick-take hearing should take no more than 15 minutes (assuming the owner does not contest the issue). While the appraiser must value the property according to valuation rules, it is not necessary to spend a great deal of time in proving the appraiser’s familiarity with the property or expertise or the basis for his or her opinion. The extent of the evidence that should be presented at quick-take can vary according to the trial court, the nature of the taking, or the position of the opposing attorney. However, if counsel has met with the witnesses beforehand, counsel should be able to answer any inquiries by the trial court or the opponent. C. [6.22] Withdrawal of the Quick-Take Award After entry of the necessary orders and deposit of preliminary compensation, the interested parties are entitled to withdraw the preliminary compensation. 735 ILCS 30/20-5-20. A verified petition should be prepared. The withdrawing party should give notice of the petition to withdraw to all parties in the case and the state’s attorney of the venue county. The state’s attorney



represents the treasurer of the county, who is usually holding the award. The trial court determines who among the interested parties is entitled to the award. Since the award must be distributed based on the owner’s direction and an attorney’s lien should not prevail against the owner’s intention, all withdrawal petitions must be executed by the owner. Also, the mortgagee has first rights to an award so the attorney should be sure the mortgagee agrees to the distribution. The condemnor’s attorney has an interest in the withdrawal of quick-take funds since it is possible that the final award may be less than the preliminary award. Id. The condemnor’s attorney should seek language in any withdrawal order requiring a refund if the preliminary amount is more than the final compensation. If there are several interested parties sharing in the award, it is advisable for counsel to seek a determination of which party is responsible for returning what part of any excess. IV. DISCOVERY A. [6.23] Supreme Court Rules Regarding Discovery Supreme Court Rule 213(f) differentiates among a “lay witness,” who is giving only factual information; an “independent expert witness,” who is rendering expert testimony but who is not a party, a party’s current employee, or a retained witness; and a “controlled expert witness,” who is rendering expert testimony and is a party, a party’s current employee, or the party’s retained witness. The disclosure required is based on the category in which a witness may be found. S.Ct. Rule 218 controls case management and requires that opinions be disclosed. This rule also implies that discovery should close 60 days before trial. S.Ct. Rule 201(b)(3) contains the provision regarding disclosure of consultants. The rules also contain the following provisions: 1. No depositions will be over three hours unless by court order or stipulation. S.Ct. Rule 206(d). 2. No discovery depositions may be taken 21 or fewer days from the trial date. S.Ct. Rule 202. 3. In reviewing the deposition, the deponent may address only typographical errors; no substantive changes will be allowed. S.Ct. Rule 207(a). 4. Only 30 interrogatories (including subparts) may be served unless by court order. S.Ct. Rule 213(c). 5. All documents produced must be produced as kept in the ordinary course of business or organized and labeled. S.Ct. Rule 214. (Note that production of new documents cannot be required through a S.Ct. Rule 237 notice to produce at trial. All documents requested under S.Ct. Rule 237 must have been requested previously in discovery.)



6. Written discovery between parties should not be filed. S.Ct. Rule 201(m). 7. Production of documents in lieu of appearance at deposition is governed by S.Ct. Rule 204(a)(4). The requesting party can still take a deposition of a party or other deponent if needed even after the documents are produced. 8. There is an ongoing duty to supplement responses to interrogatories and production requests. S.Ct. Rules 213(i), 214. 9. There is a duty, if asked, to disclose all trial witnesses and their testimony. S.Ct. Rule 213(f). A discovery deposition of a nonparty or a witness other than a controlled expert witness may be used as evidence at trial if the witness is unavailable due to death or infirmity. S.Ct. Rule 212(a)(5).

PRACTICE POINTER

Unfortunately, S.Ct. Rule 213 has taken the place of S.Ct. Rule 220. The revisions to S.Ct. Rule 213, effective July 1, 2002, may or may not assist the eminent domain practitioner. It is well to remember that discovery is not a tactical game; rather, it “is intended to be a mechanism for the ascertainment of truth, for the purpose of promoting either a fair settlement or a fair trial.” Ostendorf v. International Harvester Co., 89 Ill.2d 273, 433 N.E.2d 253, 257, 60 Ill.Dec. 456 (1982). The purpose of the discovery rules requiring timely disclosure of expert witnesses and their opinions is to avoid surprise and to discourage tactical gamesmanship. Warrender v. Millsop, 304 Ill.App.3d 260, 710 N.E.2d 512, 519, 237 Ill.Dec. 882 (2d Dist. 1999).

In Department of Transportation, State of Illinois v. Crull, 294 Ill.App.3d 531, 690 N.E.2d 143, 228 Ill.Dec. 834 (4th Dist. 1998), the trial court was reversed for allowing the owner’s appraiser to testify to the fair cash market value of the remainder after the taking. The owner’s appraiser testified during his deposition to a value of the whole based on the income approach and rendered an opinion of damage to the remainder based solely on costs to cure. The trial court struck the opinion on damage to the remainder but found that in the interests of justice, the defendant’s appraiser should be allowed to testify to his opinion of the fair cash market value of the remainder before and after the taking. The appellate court reversed, holding that the trial court abused its discretion in admitting the opinion on damage to the remainder based on a valuation for the owners of the fair cash market value of the remainder after the taking because that opinion was not previously disclosed pursuant to S.Ct. Rule 213. The appellate court stated that S.Ct. Rule 213 is mandatory and must be followed by courts and counsel. It appears that if the opponent fails to ask counsel’s opinion witness the appropriate questions during a deposition, counsel has a duty to rectify by asking the questions himself or herself. NOTE: Be advised to check the pocket parts and legislative updates for further revisions of discovery rules.



There is no right to open discovery after a reversal and remand unless the appellate court so directs. In People ex rel. Department of Transportation v. Firstar Illinois, 365 Ill.App.3d 936, 851 N.E.2d 682, 303 Ill.Dec. 495 (2d Dist. 2006), the trial court found that the reopening of discovery would prejudice the owner and would deprive the owner of just compensation in a relatively expeditious manner. The appellate court agreed, stating that when a condemnation suit continues for several years, the right to just compensation is infringed. The issue of a new trial date is addressed in the Eminent Domain Act. See 735 ILCS 30/10-5-60. B. [6.24] Interrogatories Under S.Ct. Rule 213 S.Ct. Rule 213(f) states:

(f) Identity and Testimony of Witnesses. Upon written interrogatory, a party must furnish the identities and addresses of witnesses who will testify at trial and must provide the following information: (1) Lay Witnesses. A “lay witness” is a person giving only fact or lay opinion testimony. For each lay witness, the party must identify the subjects on which the witness will testify. An answer is sufficient if it gives reasonable notice of the testimony, taking into account the limitations on the party’s knowledge of the facts known by and opinions held by the witness. (2) Independent Expert Witnesses. An “independent expert witness” is a person giving expert testimony who is not the party, the party’s current employee, or the party’s retained expert. For each independent expert witness, the party must identify the subjects on which the witness will testify and the opinions the party expects to elicit. An answer is sufficient if it gives reasonable notice of the testimony, taking into account the limitations on the party’s knowledge of the facts known by and opinions held by the witness. (3) Controlled Expert Witnesses. A “controlled expert witness” is a person giving expert testimony who is the party, the party’s current employee, or the party’s retained expert. For each controlled expert witness, the party must identify: (i) the subject matter on which the witness will testify; (ii) the conclusions and opinions of the witness and the bases therefor; (iii) the qualifications of the witness; and (iv) any reports prepared by the witness about the case. (g) Limitation on Testimony and Freedom to Cross-Examine. The information disclosed in answer to a Rule 213(f) interrogatory, or in a discovery deposition, limits the testimony that can be given by a witness on direct examination at trial. Information disclosed in a discovery deposition need not be later specifically identified in a Rule 213(f) answer, but, upon objection at trial, the burden is on the proponent of the witness to prove the information was provided in a Rule 213(f) answer or in the discovery deposition. . . . Without making disclosure under this rule, however, a cross-examining party can elicit information, including opinions, from the witness. This freedom to cross-



examine is subject to a restriction that applies in actions that involve multiple parties and multiple representation. In such actions, the cross-examining party may not elicit undisclosed information, including opinions, from the witness on an issue on which its position is aligned with that of the party doing the direct examination.

Under S.Ct. Rule 213(i), a party has a continuing duty to supplement answers to interrogatories as additional information becomes known to the party or counsel. Rule 213(k) states that the rule is to be liberally construed. At least one court has found that S.Ct. Rule 213 establishes more exacting standards for disclosure than former S.Ct. Rule 220 did. Department of Transportation, State of Illinois v. Crull, 294 Ill.App.3d 531, 690 N.E.2d 143, 228 Ill.Dec. 834 (4th Dist. 1998). An attorney or trial court wanting to ensure complete discovery of witnesses in an eminent domain proceeding and ensure against a last-minute continuance can do so by 1. making a motion requiring that each side disclose its witnesses by a date certain (S.Ct.

Rule 218); 2. propounding the interrogatories permitted by S.Ct. Rule 213; 3. filing, after review of the answers to the above-referenced interrogatories, a second notice

to produce any documents relating to the opinions disclosed in the answers; and 4. deposing all appropriate witnesses. C. [6.25] Discovery in Addition to S.Ct. Rule 213 Rules for discovery apply in eminent domain as in other civil proceedings. City of Bloomington v. Quinn, 114 Ill.App.2d 145, 252 N.E.2d 10, 14 (4th Dist. 1969). Each side may serve a notice to produce on the other. Some items that may be requested, depending on the issues in a particular case, include 1. all written appraisals (Department of Transportation v. Western National Bank of Cicero,

63 Ill.2d 179, 347 N.E.2d 161, 165 – 166 (1976)); 2. project sales books (Department of Business & Economic Development of State of Illinois

ex rel. People v. Pioneer Trust & Savings Bank, 39 Ill.App.3d 8, 349 N.E.2d 467, 473 (2d Dist. 1976));

3. all surveys of the whole property or part taken, parcel plats, and plans for the construction

of the improvements (Sanitary Dist. of Rockford v. Johnson, 343 Ill. 11, 174 N.E. 862, 864 (1931));



4. all engineering studies on the property, including but not limited to floodplain studies, reconstruction estimates, soil reports, soil borings, cost estimates for proposed improvements, and environmental studies;

5. all land use studies or plans; 6. all drawings depicting a possible use of the subject property or the remainder; 7. all maps, photographs, or aerial photographs depicting the subject property or the

immediate area; 8. all ordinances, resolutions, or minutes of meetings generated by various public bodies

regarding acquisition of the subject property by the condemnor; 9. all contracts, deeds, closing statements, or transfer tax declaration sheets regarding

comparable sales or the purchase of the subject property; 10. all leases involving the subject property; 11. all traffic studies and parking studies; and 12. the title report involving the subject property. Since the condemnor usually has at least one written appraisal and other information, including photographs, plats, and engineering studies dealing with the subject property and the pending public project, it is advisable for the owner’s attorney to file a notice to produce immediately upon appearing in the case. These documents probably will give the owner’s attorney a good starting point in understanding the plaintiff’s case. However, S.Ct. Rule 201(b)(3) exempts the work product of consulting experts from discovery unless there is a showing of exceptional circumstances, which may limit the duty to turn over some material. It should be remembered that there is an ongoing duty to supplement responses to a notice to produce. D. [6.26] Use of Interrogatories Interrogatories in an eminent domain proceeding require a party to disclose the identity of its witnesses and various information about their testimony. Interrogatories are helpful in determining an opponent’s position on certain collateral facts that affect the opinions experts may render. Some specific areas of inquiry include 1. for each lay witness who will testify at trial, the witness’s identity and address and the

subject on which the lay witness will testify; 2. for each independent expert witness who will testify at trial, the witness’s identity and

address, the subjects on which the witness will testify, and the opinions counsel is expecting to elicit;



3. for each controlled expert witness, the identity and address of the witness and the subject matter on which the witness will testify;

4. for each controlled expert witness, any and all reports prepared by the witness about the

case; 5. for each controlled expert witness, all conclusions and opinions of the expert and the

bases therefore; 6. for each controlled expert witness, all qualifications of the expert; 7. the size of the whole property, the part taken, and the remainder; 8. any area contended to be in a floodplain; 9. the zoning of the subject property; 10. the comparable sales data on which counsel’s opponent relies; 11. whether the property has been offered for sale in the last seven years; 12. whether the owner acquired the property within the last seven years; 13. whether an attempt has been made to rezone the property within the last five years; and 14. whether the owner has petitioned to have real estate taxes lowered in the last five years. E. [6.27] Deposition of Valuation Witnesses The heart of an eminent domain case is the testimony of the valuation witnesses. If an attorney wants as full a disclosure as possible of the opponent’s case and wants to limit testimony at trial to the fair scope of that presented during discovery, then a deposition should be taken of each valuation witness. It is best to review the expert’s file before the depositions. Mutual exchange of each side’s experts’ files prior to deposition is advisable. Some general areas of inquiry should include 1. a general personal background, including general education, present employment, and

employment history; 2. a general summary of expertise (i.e., memberships in professional organizations, real

estate courses taken, practical experience, and training); 3. an identification of specific areas of expertise or experience that may relate to the issues

in the case (e.g., if the property is a farm, how many farms the witness has appraised or sold in the last year);



4. an identification of experience in the area of the subject property (such as appraisals in the area or estate sales or properties developed);

5. a listing of the steps taken to appraise the subject property; 6. a description of the subject property; 7. an opinion of highest and best use; 8. an identification of the factors considered in arriving at the opinion of the highest and

best use; 9. an opinion of fair cash market value of the property; 10. an identification of the factors considered in arriving at the opinion of fair cash market

value; 11. an identification of the comparable sales considered in arriving at the opinion of value; 12. an opinion of the amount of damage to the remainder; 13. an identification of the factors considered in arriving at the opinion of the damage to the

remainder; 14. an identification of other opinions, if any, the witness has regarding this case; and

15. an identification of other expert opinions relied on by the witness. The above list is a bare-bones outline of general areas of inquiry of valuation witnesses. Specific follow-up questions must be developed in the area of issues contested at trial. Also, answers to interrogatories propounded under S.Ct. Rule 213 can provide a further outline of questions.

PRACTICE POINTER

An attorney should distinguish between cross-examination at trial and a deposition. A deposition is to find out your opponent’s case. Cross-examination is to find weaknesses before the jury. The author recommends consulting with your experts and getting your experts’ input on specific inquiries. You can choose to use a deposition for a practice cross, but then you give up the best advantage of cross — surprise.

F. [6.28] Discovery Outline A checklist of “steps” to take regarding discovery includes 1. a notice to produce;



2. the interrogatories (limited to 30); 3. a motion under S.Ct. Rule 218 to schedule disclosure of witnesses; 4. the depositions of all appropriate witnesses with production of the files; and 5. the subpoena of documents and witnesses. In addition, other tools for discovering information that may be especially helpful when a traverse has been filed include 1. any information obtained pursuant to the Freedom of Information Act (FOIA), 5 ILCS

140/1, et seq. (FOIA may be utilized by an owner before or after filing a complaint to condemn in order to ascertain whether a traverse might be filed. Requests under FOIA must comply with discovery rules if filed after a condemnation suit.);

2. a bill of particulars pursuant to 735 ILCS 5/2-607; and 3. requests to admit pursuant to S.Ct. Rule 216. V. PRETRIAL MOTIONS AND ISSUES A. [6.29] Issues of Title The only issue for the jury in an eminent domain proceeding is the amount of just compensation. All other questions are to be determined by the court. Sanitary Dist. of Rockford v. Johnson, 343 Ill. 11, 174 N.E. 862, 864 (1931). Ordinarily, the trial court determines the right of each interested party to just compensation after final judgment. 735 ILCS 30/10-5-70(a). In most properties, there are several parties with interests in the real estate. If these parties wish, it is proper to have the trial court determine their competing rights before trial. City of Chicago v. Gage, 268 Ill. 232, 109 N.E. 28, 31 (1915). B. [6.30] New Valuation Date Under the Eminent Domain Act, an owner may be entitled to a new valuation date if the trial of the matter does not occur within two years of the complaint for condemnation or if there is a quick-take within two years of the complaint. The decision is at the court’s discretion. See 735 ILCS 30/10-5-60. The Illinois Constitution requires a new valuation date if there has been a material increase in value. See Forest Preserve District of DuPage County v. First National Bank of Franklin Park, 2011 IL 110759, 961 N.E.2d 775, 356 Ill.Dec. 386. C. [6.31] Leasehold Interest If there is a full taking, a lessee can have the value of its leasehold determined separately by the jury. This right is perfected by filing a petition demanding a separate valuation. Alternatively,



the lessee may wait until final compensation is determined and seek a portion of the final award as determined by the trial court. Department of Public Works & Buildings v. Bohne, 415 Ill. 253, 113 N.E.2d 319 (1953); 735 ILCS 30/10-5-70(a). If the lessee seeks a separate valuation by the jury, the petitioner has the burden of proof as to the value of the leasehold. When there is a partial taking, the tenant has the burden of proving damage to the leasehold. Central Illinois Electric & Gas Co. v. Scully, 17 Ill.2d 348, 161 N.E.2d 304, 308 (1959). One court has held that the process should be bifurcated, with the jury first determining the fair cash market value of the property and then subsequently determining each party’s interest in the award. Department of Transportation v. White, 264 Ill.App.3d 145, 636 N.E.2d 1204, 201 Ill.Dec. 772 (5th Dist. 1994). D. [6.32] Damage to the Remainder A cross-petition is the proper method for an owner to seek compensation for damage to land not taken or described in the petition to condemn (Johnson v. Freeport & Mississippi River Ry., 111 Ill. 413, 416, 417 (1884)), and this is the proper procedure when a purchaser has received an assignment of the just compensation (Department of Transportation of State of Illinois v. Heritage-Pullman Bank & Trust Co., 254 Ill.App.3d 823, 627 N.E.2d 191, 194 Ill.Dec. 75 (1st Dist. 1993)). A cross-petition should include a description of the land alleged to be damaged and allegations of common ownership with the part taken and damage to the land not taken. Central Illinois Public Service Co. v. Rider, 12 Ill.2d 326, 146 N.E.2d 48 (1957). There is also a requirement that the cross-petition include an allegation of unity of use. Department of Conservation of State of Illinois v. Franzen, 43 Ill.App.3d 374, 356 N.E.2d 1245, 1251, 1 Ill.Dec. 912 (2d Dist. 1976). The unity of title and use and the contiguity needed to sustain a cross-petition for damage to the remainder are determined at the time the complaint to condemn is filed and not when the judgment is entered. Department of Transportation v. Chicago Title & Trust Co., 303 Ill.App.3d 484, 707 N.E.2d 637, 236 Ill.Dec. 510 (1st Dist. 1999). See also Illinois Department of Natural Resources v. Pedigo, 348 Ill.App.3d 1044, 811 N.E.2d 761, 285 Ill.Dec. 274 (4th Dist. 2004) (Department of Natural Resources sought to condemn 0.147 acres for bicycle trail). In Pedigo, the part taken by the Department of Natural Resources connected the defendants’ sod farm and landscaping business to Lake Springfield. In times of drought, water from the lake was used in the sod and landscaping business. The cross-petition filed by the defendants alleged damages for 58.89 acres. The Department of Natural Resources claimed that the whole consisted of 0.9 acres. The Department of Natural Resources moved for a judicial declaration of whole property. The trial court found that the whole property was 0.9 acres and was reversed. The appellate court found that to recover damages to the remainder, the defendants must also show that the taking would effectively damage or destroy the principal use for which the remainder of the property was designed. In this case, the water was needed for the sod farm and landscaping business. If the petition to condemn does not describe the entire property, a cross-petition is necessary to vest the court with jurisdiction on the issue of damage. Rider, supra.



The trial court has discretion to allow the filing of a cross-petition on the day of trial, particularly if the plaintiff will not be unfairly surprised, as in a case in which damages are found at the quick-take proceeding. Id.; Department of Public Works & Buildings of State of Illinois v. Hall, 30 Ill.App.3d 831, 333 N.E.2d 701, 705 (2d Dist. 1975). Conversely, the trial court may deny a late filing of a cross-petition if it appears that the trial will be delayed. Lake County Forest Preserve District v. Continental Illinois National Bank & Trust Company of Chicago, 35 Ill.App.3d 942, 343 N.E.2d 6, 12 (2d Dist. 1976); Forest Preserve District of Cook County v. Krol, 12 Ill.2d 139, 145 N.E.2d 599, 605 (1957); Heritage-Pullman Bank, supra. E. [6.33] Bill of Particulars If a cross-petition alleging damage to the remainder is filed, the owner may be required, at the discretion of the trial court, to answer a demand for a bill of particulars seeking the amount of damages claimed and the elements of such damage. 735 ILCS 5/2-607; City of Chicago v. Callender, 396 Ill. 371, 71 N.E.2d 643, 645 – 646 (1974). A bill of particulars is useful in clarifying pleadings and can eliminate questions as to what elements of damage are before the jury. Department of Transportation of State of Illinois v. Association of Franciscan Fathers of State of Illinois, 93 Ill.App.3d 1141, 418 N.E.2d 36, 40, 49 Ill.Dec. 392 (2d Dist. 1981). F. [6.34] Inspection of Real Estate; Sample Agreed Protection Order The condemnor has a right to make an inspection of the subject property for the purpose of obtaining information, including appraisals, surveys, and soil borings. S.Ct. Rule 214. If the condemning body will be performing the test, it is in the best interests of both the condemnor and condemnee to enter into a protective order setting forth liability, insurance, and disclosure of information issues. Following is an example of a protective order:

[Caption]

AGREED PROTECTIVE ORDER THIS CAUSE COMING ON to be heard on Plaintiff’s motion for inspection of property and the court being advised of the premises, IT IS HEREBY ORDERED: 1. Defendant shall allow access to the property by Plaintiff’s contractors or subcontractors, including Plaintiff’s engineer, for the purpose of conducting certain subsurface tests. The tests to be conducted shall consist of borings and any temporary monitoring well(s) to be placed at locations previously disclosed to Defendant.



2. Plaintiff and its contractors and subcontractors recognize that the activities authorized herein will occur at an operating business. Any contractor, subcontractor, or representative of Plaintiff present at the property shall comply with any workplace safety requirements of Defendant and shall not unreasonably interfere with the operations or customers of Defendant’s business. 3. Plaintiff and its contractors and subcontractors shall secure in their own names and at their own cost all necessary permits and authorizations in order to undertake the above-mentioned activities and tests. Plaintiff and its contractors and subcontractors shall inspect the property and the immediate surrounding area prior to the start of any activities hereunder to ensure that those activities will not damage surrounding structures, utility lines, or any other subsurface lines or cables. 4. Upon completion of the access provided for herein, Plaintiff and its contractors and subcontractors shall restore the property, normal wear and tear excepted, to the condition existing prior to the entry on the property authorized herein, including the removal of the temporary monitoring well. Plaintiff and its contractors and subcontractors shall be solely responsible for the proper removal from the property of any and all equipment and any materials generated or produced as the result of the sampling authorized herein, including drill cuttings, water or groundwater, and sampling equipment. Plaintiff, its contractors, and its subcontractors shall not treat, dispose of, or release any such materials on the property. 5. Plaintiff shall require any contractor or subcontractor entering onto the property pursuant hereto to procure and maintain, at its sole cost and expense, a policy or policies of insurance as follows: workers’ compensation at statutory coverage; comprehensive form (including independent contractor, contractual, and automobile liability) with coverage of at least [required amount of coverage] per event and combined limit; and insurance providing for damage to the property caused by the contractor or subcontractor with coverage of at least [required amount of coverage] per event and combined limit. The contractor or subcontractor shall provide Plaintiff and Defendant with certificates of insurance indicating that the above coverages have been obtained, with endorsements naming Plaintiff and Defendant as additional insureds. 6. Plaintiff shall be solely responsible for the cost of the sampling activities to be conducted by its contractors and subcontractors. Plaintiff shall keep the property free and clear from any and all liens and encumbrances arising out of any work performed, materials furnished, or obligations incurred by or for Plaintiff. 7. The results of any tests or analyses performed by Plaintiff or its agents, contractors, or subcontractors on the subject property or samples from the subject property pursuant to this Agreed Protective Order, including any and all reports written or oral, shall be and remain the property of Plaintiff. Plaintiff shall supply any such reports to Defendant. 8. In the event any person, other than those previously disclosed to Defendant, shall seek to obtain such information from Plaintiff or its employees, agents, contractors, or



subcontractors, whether by way of a Freedom of Information Act request or an administrative or judicial demand or order, Plaintiff shall immediately provide written notice to Defendant. 9. If counsel or engineer for any party intends to be present on the property at any of the testing provided for under Paragraph 1 hereof, counsel for that party shall give every other party’s counsel [hours’ notice required] hours’ prior notice. If Defendant intends to perform split sampling, it shall do so at its own expense. Plaintiff shall provide a copy of this Agreed Protective Order to every person who will have access to the property pursuant hereto, and all such persons shall by receipt of this Agreed Protective Order and entry upon the property have consented to comply with the terms hereof. 10. Any party may, by motion, request an order of the Court seeking enforcement of the terms of this Agreed Protective Order. DATED: ______________ ENTERED: ____________________________________ Judge AGREED TO: _______________________________ Defendant By: ____________________________ Attorney for Defendant _______________________________ Plaintiff By: ____________________________ Attorney for Plaintiff

PRACTICE POINTER

After doing a complete discovery job, it is then your responsibility to give the information obtained to your experts in a form that can help your experts (1) to prepare for deposition and cross and (2) to prepare rebuttal opinions. While you should not dilute information, neither should you inundate the expert with tons of paper. Analyze the information, filter out makeweight discovery, and give the heart of your opponent’s case to your experts. You, as the attorney, are responsible for preparing your experts for deposition and trial. You must be realistic as to what the expert will do and edit discovery for the witness. You have the right to subpoena, take depositions, and propound interrogatories — your experts do not have these rights. Use this information to prepare



your witness completely for both deposition and trial. Even the most experienced witnesses do not know eminent domain valuation rules as well as a knowledgeable attorney. Be sure to filter all opinions before deposition for possible violations of valuation law. Discovery should help you do all of the above.

G. [6.35] Motion in Limine A motion in limine seeks a ruling by the trial court on an evidentiary question prior to presentation of that evidence at trial. No statute or Supreme Court Rule provides for its use, but it has been approved by reviewing courts. Department of Public Works & Buildings of State of Illinois v. Roehrig, 45 Ill.App.3d 189, 359 N.E.2d 752, 3 Ill.Dec. 893 (5th Dist. 1976). Although one of the purposes of a motion in limine is to relieve the attorney from having to object to evidence in the presence of the jury, the attorney still must object to any disputed evidence introduced at trial — even if the court has denied a motion in limine — in order to preserve the issue. Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 163 Ill.2d 498, 645 N.E.2d 896, 206 Ill.Dec. 644 (1994). A motion in limine can also prevent an opponent from putting prejudicial evidence before the jury even if a subsequent objection is sustained. Some general areas in which a motion in limine may be helpful include the following: Admission of comparable sales or the purchase price of the subject property. In many eminent domain trials, admission or denial of comparable sales or the purchase price of the subject property is the key to the case. If the trial court rules on the admissibility of sales evidence in advance of the trial, it may shorten the time for the jury trial and give each side a more realistic settlement position. Valuation problems. In many eminent domain proceedings, issues arise as to the admissibility of evidence regarding the valuation of the property, expert testimony, or damage to the remainder. A motion in limine can raise these issues prior to trial. See Department of Public Works & Buildings of State of Illinois ex rel. People v. Sun Oil Co., 66 Ill.App.3d 64, 383 N.E.2d 634, 22 Ill.Dec. 826 (5th Dist. 1978); City of Rock Island, Illinois v. Moline National Bank, 54 Ill.App.3d 853, 368 N.E.2d 1113, 11 Ill.Dec. 505 (3d Dist. 1977); Department of Public Works & Buildings of State of Illinois v. Exchange National Bank, 31 Ill.App.3d 88, 334 N.E.2d 810 (2d Dist. 1975). Whether there is sufficient evidence to allow the issue of reasonable probability of rezoning, annexation, or access to go to the jury. This issue must be ruled on by the trial court in camera. Department of Transportation v. Western National Bank of Cicero, 63 Ill.2d 179, 347 N.E.2d 161, 164 (1976). A hearing on this issue prior to trial can be helpful. H. [6.36] Case Management Conference Case management or pretrial conferences are discussed in S.Ct. Rule 218, which contemplates that more than one case management conference may be held. Disclosure of witnesses and completion of discovery are contemplated at least 60 days before trial.



Most counties have forms for case management orders and required dates for exchanging reports, answering written discovery, completing depositions, and setting pretrial and settlement conferences. Some forms provide that the parties may waive the 60-day disclosure requirement before trial. If the parties agree to entry of a final judgment order containing the stipulation of the parties, the provisions must be clearly set forth. See Timothy Christian Schools v. Village of Western Springs, 285 Ill.App.3d 949, 675 N.E.2d 168, 221 Ill.Dec. 261 (1st Dist. 1996). The parties cannot confer subject-matter jurisdiction on the court. See City of Marseilles v. Radke, 287 Ill.App.3d 757, 679 N.E.2d 125, 223 Ill.Dec. 181 (3d Dist. 1997). If the state breaches a settlement agreement, the owner’s remedy is in the circuit court and not the Court of Claims. See Vogt v. Bartelsmeyer, 264 Ill.App.3d 165, 636 N.E.2d 1185, 201 Ill.Dec. 753 (5th Dist. 1994). In Southwestern Illinois Development Authority v. Al-Muhajirum, 348 Ill.App.3d 398, 809 N.E.2d 730, 284 Ill.Dec. 164 (5th Dist. 2004), the trial court was affirmed for denying the owners’ motion to continue trial for the fifth time based on the judges’ inherent powers to administer their dockets in a manner designed to ensure the efficient and economic disposition of cases. There was sufficient time for the owners to prepare for trial. Although the plaintiff had taken the property by quick-take and the improvement had been built, the plaintiff was prejudiced by a continuance because it had to pay attorneys’ fees. I. [6.37] Offers To Settle Before Trial Under the Eminent Domain Act, an owner whose property is being acquired for elimination of blight may serve a written offer to settle a case after discovery closes under an S.Ct. Rule 218 order up to 14 days before trial. 735 ILCS 30/10-5-110. The condemnor then has 10 days to accept the offer. If no acceptance is received after 10 days, the offer is considered withdrawn. If the offer is accepted, the condemnor must serve written notice of acceptance within the 10 days. The offer and acceptance, along with proof of notice, may then be filed with the court by either of the parties and a final judgment order is entered in accordance. If the condemnor does not accept the offer and the jury returns a verdict equal to or in excess of the owner’s offer, the condemnor must pay costs — including all expert witness fees incurred between the date of the offer and the conclusion of the trial — and attorneys’ fees based on the net benefit to the owner. It appears that the best time to serve an offer would be soon after discovery closes so that all the opinions are disclosed and a suitable offer can be made after consultation with the client. If the offer is not accepted, the fees incurred in trial preparation would be recoverable. J. [6.38] Pretrial Appeals If a question of law arises as to whether an expert is using a proper valuation method, S.Ct. Rule 308(a) allows the trial court to certify a question for appellate review. In Department of Transportation, State of Illinois v. Kelley, 352 Ill.App.3d 278, 815 N.E.2d 1214, 287 Ill.Dec. 411 (3d Dist. 2004), the Department of Transportation took 1 acre from a 289-acre, mostly vacant tract. The owner’s valuation witnesses valued this 1 acre as commercial, based on 80 acres of the 289-acre whole having a highest and best use of commercial. The plaintiff moved to bar this testimony as a violation of the unit rule. The trial court allowed the testimony, but the appellate



court reversed, holding that the unit rule prohibited this testimony. A specially concurring opinion was filed by Justices Holdridge and Schmidt and stated in part:

The purpose to be accomplished in condemnation proceeding is to provide “just compensation” to the landowner as determined by the fair cash market value of the property at its highest and best use. City of Chicago v. Anthony, 136 Ill.2d 169, [554 N.E.2d 1381, 144 Ill.Dec. 93] (1990). The “unit rule” almost never achieves that purpose. Simply put, the “unit rule” ignores realities of land valuation and should give way. The approach articulated in HP/Meachum [Department of Transportation v. HP/Meachum Land Limited Partnership, 245 Ill.App.3d 252, 614 N.E.2d 485, 185 Ill.Dec. 351 (2d Dist. 1993)] is not an extension of the unit rule, but an exception that should be allowed to swallow up the rule. Our supreme court should revisit the issue. 815 N.E.2d at 1219.

It is beyond the scope of this chapter to analyze the unit rule. Current Illinois law limits judicial review of the admissibility of expert testimony to whether the expert is relying on a commonly accepted technique in that field of expertise. See Donaldson v. Central Illinois Public Service Co., 199 Ill.2d 63, 767 N.E.2d 314, 262 Ill.Dec. 854 (2002). There are, however, a number of Illinois court decisions, rendered decades ago, that impede valuation experts from testifying to established valuation techniques. A practitioner could use S.Ct. Rule 308(a) as a means to raise such issues and attempt to bring Illinois law in line with expert valuation techniques. Using Rule 308(a) would allow appellate review before the expense, risk, and time of a jury trial.


Valuation of Property in Eminent Domain

RICHARD A. REDMOND CHRISTOPHER J. MURDOCH Holland & Knight LLP Chicago

7



I. Introduction A. [7.1] Scope of Chapter and Importance of Valuation Rules B. [7.2] Historical Background C. [7.3] Eminent Domain Act 1. [7.4] Background of Illinois’ Current Eminent Domain Act 2. [7.5] Effective Date and Exceptions D. [7.6] Illinois Pattern Jury Instructions and Uniform Eminent Domain Act E. [7.7] Appellate Review II. [7.8] Use of Experts To Prove Valuation Issues A. [7.9] Appraisers as Expert Witnesses B. [7.10] Bases of Appraisers’ Opinions C. [7.11] Facts and Data Reasonably Relied On and Admissibility D. [7.12] Gatekeeper Role of Trial Judge III. Valuation in Complete Acquisitions A. Just Compensation 1. [7.13] Just Compensation as Fair Cash Market Value 2. [7.14] Date of Valuation 3. Highest and Best Use a. [7.15] Definitions b. [7.16] Reasonable Probability of Rezoning 4. [7.17] Unit Rule a. [7.18] Partial Takings b. [7.19] Unit Rule and Expert Cross-Examination B. Other Aspects of Just Compensation 1. [7.20] Interest as Just Compensation 2. [7.21] Attorneys’ Fees and Litigation Costs 3. [7.22] Relocation Assistance C. Fair Cash Market Value 1. [7.23] Determining Fair Cash Market Value a. [7.24] Market or Comparable-Sales Approach b. [7.25] Cost Approach c. [7.26] Income Approach 2. [7.27] Elements Excluded from Fair Cash Market Value a. [7.28] Appreciation or Depreciation Caused by Project b. [7.29] Illegal Use

VALUATION OF PROPERTY IN EMINENT DOMAIN


c. [7.30] Business Done on Property d. [7.31] Cost of Moving e. [7.32] Taxation f. [7.33] Replacement Costs g. [7.34] Existing Right-of-Way 3. [7.35] Environmental Issues 4. [7.36] Minerals, Timber, and Farm Property 5. [7.37] Subdivision Property 6. [7.38] Billboards 7. [7.39] Special-Use Property IV. Valuation in Partial Acquisitions A. [7.40] General Principles B. [7.41] Cross-Petition C. [7.42] Valuation of Part Taken D. [7.43] Stipulations E. [7.44] Definition of “Remainder Property” F. [7.45] Proper Elements of Damages 1. [7.46] Cost To Cure 2. [7.47] Reduction in Size 3. [7.48] Noise 4. [7.49] Unsightliness 5. [7.50] Access G. [7.51] Improper Elements of Damage H. [7.52] Benefits V. Valuation in Easement Acquisitions A. [7.53] Permanent Easement B. [7.54] Temporary Easement



I. INTRODUCTION A. [7.1] Scope of Chapter and Importance of Valuation Rule This chapter examines the rules governing the valuation of property acquired in proceedings under the Eminent Domain Act (EDA), 735 ILCS 30/1-1-1, et seq. Because almost all acquisitions involve real estate, this chapter discusses real estate valuation only. However, since the word “property” in Article I, §15, of the Illinois Constitution, “includes every interest anyone may have in any and everything which is the subject of ownership” (Morton Grove Park District v. American National Bank & Trust Co., 78 Ill.2d 353, 399 N.E.2d 1295, 1299, 35 Ill.Dec. 767 (1980)), the power of eminent domain extends to all types of property. See also Demos v. Pappas, 2011 IL App (1st) 100829, 956 N.E.2d 533, 353 Ill.Dec. 671. In an acquisition of property other than real property, many of these same principles will apply. While Article I, §15, of the Illinois Constitution provides that “[p]rivate property shall not be taken or damaged for public use without just compensation,” it does not provide any guidelines for determining the actual amount of compensation to be paid for the property. The rules for valuing property in an eminent domain proceeding have been developed through hundreds of court decisions, a limited number of statutory provisions, and application of the Illinois Rules of Evidence. These rules determine how the property will be valued and, based on this valuation, how much the condemnor must pay and how much the owner may receive. Although the jury determines, as a question of fact, the compensation to be paid, the judge determines, as a question of law, the principles governing valuation and, as a result of this determination, the type of evidence that may be presented to the trier of fact. Sanitary Dist. of Rockford v. Johnson, 343 Ill. 11, 174 N.E. 862 (1931). On a theoretical level, the principles of valuation provide the means for socializing the cost of public projects by requiring the public, in the form of the condemnor, to pay those property owners who stand in the path of the project. The importance of these principles is expressed in a quotation from Olson v. United States, 292 U.S. 246, 78 L.Ed. 1236, 54 S.Ct. 704, 708 (1934):

The judicial ascertainment of the amount that shall be paid to the owner of private property taken for public use through exertion of the sovereign power of eminent domain is always a matter of importance for, as said in Monongahela Navigation Co. v. United States, 148 U.S. 312, 324, 13 S.Ct. 622, 625, 37 L.Ed. 463: “In any society the fullness and sufficiency of the securities which surround the individual in the use and enjoyment of his property constitute one of the most certain tests of the character and value of the government.”

On a practical level, an attorney who represents either the condemnor or the owner must know the valuation rules and advise any experts who will testify of the applicable rules. If a witness does not testify in accordance with these rules, e.g., if the witness considers improper elements of damage to the remainder, the testimony may be stricken and the valuation opinion excluded. Illinois Power & Light Corp. v. Talbott, 321 Ill. 538, 152 N.E. 486 (1926); City of Chicago v. Central National Bank in Chicago, 5 Ill.2d 164, 125 N.E.2d 94 (1955).

VALUATION OF PROPERTY IN EMINENT DOMAIN §7.2


In both Board of Trustees of University of Illinois v. Shapiro, 343 Ill.App.3d 943, 799 N.E.2d 383, 278 Ill.Dec. 665 (1st Dist. 2003), and Southwestern Illinois Development Authority v. Al-Muhajirum, 348 Ill.App.3d 398, 809 N.E.2d 730, 284 Ill.Dec. 164 (5th Dist. 2004), the appellate court affirmed the trial court’s decision to bar the testimony of appraisers who had failed to follow the proper rules of valuation. Shapiro involved the improper use of comparable sales and an improper highest and best use analysis. Al-Muhajirum involved a failure to appraise the subject property as it existed on the valuation date. Moreover, the principles governing valuation of property in eminent domain proceedings are unique and not necessarily the same as the principles used in valuing property for other purposes. For example, the same property may be valued differently for inheritance tax purposes than for condemnation purposes (Department of Transportation of State of Illinois v. Prairie Travler, Inc., 52 Ill.App.3d 799, 368 N.E.2d 144, 10 Ill.Dec. 658 (4th Dist. 1977)), or it may be valued differently for real estate tax purposes than it would be for condemnation purposes (City of Chicago v. Harrison-Halsted Building Corp., 11 Ill.2d 431, 143 N.E.2d 40 (1957)). The careful lawyer should determine the exact nature of the property being acquired. For example, in Department of Transportation ex rel. People v. Farnsworth, 273 Ill.App.3d 631, 653 N.E.2d 423, 210 Ill.Dec. 518 (3d Dist. 1995), the Illinois Department of Transportation (IDOT) took fee simple title to a pile of waste material from mining operations rather than fee simple title to the land itself. The appellate court held that the unit rule (see §7.17 below) did not apply under these precise circumstances because waste material, not land, was being acquired. The actual evidence used to establish value depends on the circumstances of each case. The parties may introduce evidence describing the property itself, such as its size, location, and zoning; evidence of sales of comparable properties; and evidence of experts, such as appraisers, brokers, and engineers. The procedure for presenting this evidence is discussed elsewhere in this handbook. See especially Chapter 8. Chapter 12 of this handbook discusses the valuation problems encountered when dealing with the application of environmental laws to real estate. With the advent of intensive environmental regulation of the use of real estate and the complexity of this body of law, a separate discussion of the unique issues posed by contaminated property is warranted. B. [7.2] Historical Background The contemporary legal doctrine that requires a condemnor to compensate the owner for taking or damaging property evolved over several centuries. Prior to 1215, the English king maintained an absolute right to seize property without either specific legal authority or payment of compensation. However, as part of the grant of rights given to the English nobles at Runnymede in 1215, King John agreed, in Article 39 of the Magna Carta (Article 29 of the 1225 version confirmed by Henry III), that “[n]o freeman shall be taken or [and] imprisoned or disseised or exiled or in any way destroyed, nor will we go upon him nor send upon him, except by the lawful judgment of his peers or [and] by the law of the land.” William Sharp McKechnie, MAGNA CARTA: A COMMENTARY ON THE GREAT CHARTER OF KING JOHN, Ch. 39, p. 375 (2d ed. 1914).



An early explanation of the role of compensation in eminent domain was given by Hugo Grotius, a Dutch jurist who studied Roman civil law. In 1625, he wrote:

A king may two ways deprive his subjects of their right, either by way of punishment or by virtue of the eminent domain power. But if he does it the last way, it must be for some public advantage, and then the subject ought to receive, if possible, a just satisfaction for the loss he suffers, out of the common stock. Hugo Grotius, DE JURE BELLE AC PACIS, Ch. XIV, §VII (1625).

In his commentary on the common law of England, written and published between 1765 and 1769, William Blackstone also recognized an obligation to pay for public acquisitions:

If a new road, for instance, were to be made through the grounds of a private person, it might perhaps be extensively beneficial to the public; but the law permits no man, or set of men, to do this without consent of the owner of the land. In vain may it be urged, that the good of the individual ought to yield to that of the community; for it would be dangerous to allow any private man, or even any public tribunal, to be the judge of this common good, and to decide whether it be expedient or no. Besides, the public good is in nothing more essentially interested, than in the protection of every individual’s private rights, as modeled by the municipal law. In this, and similar cases the legislature alone can, and indeed frequently does, interpose and compel the individual to acquiesce. But how does it interpose and compel? Not by absolutely stripping the subject of his property in an arbitrary manner; but by giving him a full indemnification and equivalent for the injury thereby sustained. The public is now considered as an individual, treating with an individual for an exchange. All that the legislature does is to oblige the owner to alienate his possessions for a reasonable price; and even this is an exertion of power, which the legislature indulges with caution, and which nothing but the legislature can perform. 1 William Blackstone, COMMENTARIES ON THE LAWS OF ENGLAND, p. 135 (1979).

Blackstone’s strong influence on the founding fathers is reflected in that part of the Fifth Amendment to the United States Constitution that states “nor shall private property be taken for public use, without just compensation.” Through most of the 19th century, however, the United States Supreme Court refused to apply this section of the Bill of Rights to state, as opposed to federal, interference with private property. Barron v. Mayor of Baltimore, 32 U.S. (7 Pet.) 243, 8 L.Ed. 672 (1833); West River Bridge Co. v. Dix, 47 U.S. (6 How.) 507, 12 L.Ed. 535 (1848). In 1897, the Supreme Court reversed its position and held that taking private property for public use without payment of just compensation violates the Fourteenth Amendment’s prohibition against taking property without due process of law. Since the Fourteenth Amendment’s guarantees apply to state action, the Supreme Court effectively made the Fifth Amendment’s right to compensation applicable to state proceedings. Chicago, B. & Q.R. Co. v. City of Chicago, 166 U.S. 226, 41 L.Ed. 979, 17 S.Ct. 581 (1897). The Illinois Supreme Court has acknowledged the Fifth Amendment’s applicability to Illinois condemnation proceedings. Morton Grove Park District v. American National Bank &



Trust Co., 78 Ill.2d 353, 399 N.E.2d 1295, 35 Ill.Dec. 767 (1980); Davis v. Brown, 221 Ill.2d 435, 851 N.E.2d 1198, 303 Ill.Dec. 773 (2006). In Illinois, the Constitution of 1848 provided: “nor shall any man’s property be taken or applied to public use without the consent of his representatives in the general assembly, nor without just compensation being made to him.” ILL.CONST. (1848) art. XIII, §11. The Illinois Supreme Court construed this provision to require compensation only when there had been an actual physical injury to the property. If no physical invasion had occurred, the Supreme Court ruled, no taking had occurred and therefore no compensation need be paid. Nevins v. City of Peoria, 41 Ill. 502 (1866). The 1870 Illinois Constitution enlarged the right of recovery and gave greater security to private property rights by adding the words “or damaged” to the condemnation article. The revised article read: “Private property shall not be taken or damaged for public use without just compensation.” ILL.CONST. (1870) art. II, §13. Following the passage of the 1870 Constitution, the state legislature enacted the Eminent Domain Act of 1872, Laws 1871 – 1872, p. 402, §1 (formerly Ill.Rev.Stat., c. 47, ¶1), which contained the same language. The Illinois Supreme Court then interpreted the change in wording in Rigney v. City of Chicago, 102 Ill. 64, 75 (1881), by stating that the addition of the words “or damaged” constituted a significant change in the law that granted new rights to property owners. While the new constitutional provision would not require compensation in all cases of injury to property, it would warrant recovery if

there has been some direct physical disturbance of a right, either public or private, which the plaintiff enjoys in connection with his property, and which gives to it an additional value, and that by reason of such disturbance he has sustained a special damage with respect to his property in excess of that sustained by the public generally. 102 Ill. at 81.

Although Rigney was a four-three decision, the Supreme Court reaffirmed its holding in Chicago & Western Indiana R.R. v. Ayres, 106 Ill. 511 (1883), and the case has been cited extensively ever since. In 1970, Illinois adopted a new Constitution. Despite a recommendation from the Bill of Rights Committee to change the 1870 constitutional provision by adding the words “or the use thereof impaired” after the word “damaged,” and by adding the words “to the full extent of the loss” after the word “compensation,” the delegates to the Constitutional Convention decided not to change this part of the 1870 Constitution. Article I, §15, of the Illinois Constitution states: “Private property shall not be taken or damaged for public use without just compensation as provided by law.” Therefore, the decisions construing this language in the 1870 Constitution remain relevant to the 1970 Constitution. By adding the words “or damaged” to its constitutional provisions, Illinois provides a greater guarantee for compensation than that found in the Fifth Amendment to the United States Constitution, which refers only to property taken, not to property damaged. Equity Associates, Inc. v. Village of Northbrook, 171 Ill.App.3d 115, 524 N.E.2d 1119, 121 Ill.Dec. 71 (1st Dist. 1988).



The Illinois Supreme Court explained the difference between the federal and Illinois takings clause in Hampton v. Metropolitan Water Reclamation District of Chicago, 2016 IL 119861, ¶14:

A review of the transcripts from the Constitutional Convention of 1870, when the “damage” prong of the Illinois takings clause was added, indicates no intent on the part of the convention delegates to deviate from the federal definition of a taking. The amendment was made to provide broader protection and establish a constitutional remedy for property owners whose real estate is damaged but not taken as a result of public improvements.

Most of the rules of valuing property developed under the 1870 or 1970 constitutional provisions have evolved on a case-by-case basis. The predominant common-law development has led to some inconsistencies in Illinois law but certainly no more than occur in federal eminent domain law that commentators have described as a “crazy-quilt pattern of Supreme Court doctrine” (Allison Dunham, Griggs v. Alleghany County in Perspective: Thirty Years of Supreme Court Expropriation Law, 1962 Sup.Ct.Rev. 63) or as a “massive body of case law, irreconcilable in its inconsistency, confusing in its detail and defiant of all attempts at classification” (The Public Use Limitation on Eminent Domain: An Advance Requiem, 58 Yale L.J. 599, 605 – 606 (1949)). The Illinois Supreme Court codified the rules of evidence by adopting the Illinois Rules of Evidence, effective January 1, 2011. Many of the rules may be applicable in eminent domain cases, and therefore may affect the introduction of valuation evidence. For example, Rules 702 – 705 govern expert opinions and testimony. Both the federal and Illinois courts have extensively explored the field of regulatory takings. At issue most often in these cases is the question of when a land use regulation becomes a taking of property rights that triggers an owner’s constitutional right to receive just compensation. A discussion of these cases is beyond the scope of this chapter. C. [7.3] Eminent Domain Act Although the judiciary finally determines whether the rules for valuation conform to the constitutional requirement of just compensation (Marbury v. Madison, 5 U.S. (1 Cranch) 137, 2 L.Ed. 60 (1803); United States v. Commodities Trading Corp., 339 U.S. 121, 94 L.Ed. 707, 70 S.Ct. 547 (1950)), the Illinois legislature codified the general rule of valuation in §10-5-60 of the Eminent Domain Act:

Value. Except as to property designated as possessing a special use, the fair cash market value of property in a proceeding in eminent domain shall be the amount of money that a purchaser, willing, but not obligated, to buy the property, would pay to an owner willing, but not obliged, to sell in a voluntary sale.

* * * In the condemnation of property for a public improvement, there shall be excluded from the fair cash market value of the property any appreciation in value



proximately caused by the improvement and any depreciation in value proximately caused by the improvement. However, such appreciation or depreciation shall not be excluded when property is condemned for a separate project conceived independently of and subsequent to the original project. 735 ILCS 30/10-5-60.

The Illinois legislature enacted this part of the EDA in 1972 to conform to the mandate of the federal Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (URA), Pub.L. No. 91-646, 84 Stat. 1894, that each state must comply with the URA’s requirements to avoid a moratorium on its federally financed projects. City of Rock Island, Illinois v. Moline National Bank, 54 Ill.App.3d 853, 368 N.E.2d 1113, 11 Ill.Dec. 505 (3d Dist. 1977). The EDA contains many other provisions affecting valuation, which are analyzed subsequently in this chapter. 1. [7.4] Background of Illinois’ Current Eminent Domain Act The government’s use of the eminent domain power became a highly publicized and debated topic following the United States Supreme Court’s decision in Kelo v. City of New London, Connecticut, 545 U.S. 469, 162 L.Ed.2d 439, 125 S.Ct. 2655 (2005). This led the Illinois state legislature to examine and revise, in part, the state’s eminent domain statute. P.A. 94-1055 (eff. Jan. 1, 2007) created the Eminent Domain Act, which replaced the former eminent domain statute located in Article VII of the Code of Civil Procedure, 735 ILCS 5/7-101, et seq. The EDA also attempts to consolidate in one place all statutory provisions relating to the exercise of the eminent domain power. Should a conflict arise between the provisions of the EDA and other statutory provisions, the EDA controls. The EDA states that it is a denial and limitation of home-rule powers and functions pursuant to Article VII, §6(h), of the Illinois Constitution. See 735 ILCS 30/90-5-20. While the EDA restates most of Article VII of the Code of Civil Procedure and other eminent domain statutes, it does make several important changes. Because Kelo, supra, and the subsequent public debate focused primarily on the issue of whether a taking met the public-use constitutional standard rather than the just compensation constitutional standard, most of the statutory changes focus on establishing a more precise public-use standard. However, some changes also affect compensation. For example, as discussed in §7.14 below, the date of valuation may change during the pendency of a condemnation proceeding. 2. [7.5] Effective Date and Exceptions It is important to know what the Eminent Domain Act does not affect. The effective date was January 1, 2007. Section 90-5-5 states that the EDA applies only to complaints to condemn filed after January 1, 2007. 735 ILCS 30/90-5-5. The rationale supporting the January 1, 2007, effective date was to give governmental agencies adequate forewarning to the change in the law so that projects could be planned or changed accordingly. The effective date of the EDA means that practitioners may need to refer to Article VII of the Code of Civil Procedure for some cases.



The EDA does not apply to land acquisition under the O’Hare Modernization Act, 620 ILCS 65/1, et seq. Nor do some of the EDA’s provisions, particularly the proof standards in §5-5-5, apply to land acquisition in furtherance of an existing “tax increment allocation redevelopment plan,” defined as

a redevelopment plan that was adopted under the Tax Increment Allocation Redevelopment Act (Article 11, Division 74.4 of the Illinois Municipal Code) prior to April 15, 2006 and for which property assembly costs were, before that date, included as a budget line item in the plan or described in the narrative portion of the plan as part of the redevelopment project. 735 ILCS 30/5-5-5(a-10).

The rationale supporting the exception for existing tax increment financing (TIF) projects is that municipalities have planned and invested in these projects in accordance with assumptions about the ability to acquire land and the cost of land acquisition, and it would be unfair to change the rules in the middle of the project. In some situations, the rules could have derailed an ongoing project. The existing TIF exception to the provisions of the EDA is qualified in four ways. A condemnation case filed after January 1, 2007, is subject to the EDA’s provisions even if in furtherance of an existing TIF project, it involves (a) any additional area added to the TIF plan after April 15, 2006; (b) any subsequent extension after April 15, 2006, of the plan’s completion date; (c) any acquisition in a conservation TIF if the case is filed after January 1, 2019; or (d) any acquisition of property in an industrial park conservation area. Id. D. [7.6] Illinois Pattern Jury Instructions and Uniform Eminent Domain Act The attorney handling a condemnation case also should be familiar with the standard eminent domain jury instructions contained in the Illinois Pattern Jury Instructions — Civil (I.P.I. — Civil). They provide a useful codification of the law, and the comments to each instruction are helpful. In addition, Illinois Supreme Court Rule 239(a) provides an I.P.I. “shall be used, unless the court determines that it does not accurately state the law.” Compliance with the I.P.I. recommendations usually provides a safe harbor and eliminates the risk of an appellate reversal due to improper instructions. Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 196 Ill.App.3d 5, 552 N.E.2d 1151, 142 Ill.Dec. 410 (2d Dist. 1990). The specific jury instructions directed to condemnation cases are I.P.I. — Civil Nos. 300.01 – 300.87. Use of the I.P.I. undoubtedly has reduced the number of appeals arising out of jury instruction disputes. However, reliance on the I.P.I. should not be blind. The law can change after the issuance of the pattern instructions, rendering them unreliable. That is what occurred in Department of Public Works & Buildings v. Association of Franciscan Fathers of State of Illinois, 69 Ill.2d 308, 371 N.E.2d 616, 13 Ill.Dec. 681 (1977), in which the Supreme Court held that former I.P.I. — Civil No. 300.85 (2d ed. 1971) did not accurately state the law and, as a result, the trial court had erred when, relying on former I.P.I. — Civil No. 300.85, it refused to instruct the jurors that they could consider the reasonable probability of rezoning in ascertaining just compensation.



If non-I.P.I. instructions are proposed, the careful lawyer should note that the jury instruction not only must correctly state the law but also must be clear and comprehensible to the jury. Oak Brook Park District v. Oak Brook Development Co., 170 Ill.App.3d 221, 524 N.E.2d 213, 120 Ill.Dec. 448 (2d Dist. 1988). And even if the non-I.P.I. instruction correctly states the law, an appellate court may reverse on the grounds the trial court unduly highlighted one segment of the case by giving the non-I.P.I. instruction. Illinois State Toll Highway Authority v. Dicke, 208 Ill.App.3d 158, 566 N.E.2d 1003, 153 Ill.Dec. 153 (2d Dist. 1991). In 1974, the National Conference of Commissioners on Uniform State Laws approved the Uniform Eminent Domain Code and recommended it for enactment by the states. Unlike the Uniform Commercial Code, 810 ILCS 5/1-101, et seq., the Uniform Eminent Domain Code received very little positive response. Illinois did not enact any of its provisions. However, in Department of Natural Resources of State of Illinois v. Brauer, 339 Ill.App.3d 723, 791 N.E.2d 120, 274 Ill.Dec. 324 (3d Dist. 2003), both the majority and dissent opinions refer to the Uniform Eminent Domain Code for guidance. E. [7.7] Appellate Review The appellate courts will uphold the jury’s determination of just compensation unless the verdict is more than the maximum testimony or less than the minimum testimony (Central Illinois Public Service Co. v. Rider, 12 Ill.2d 326, 146 N.E.2d 48 (1957); Department of Transportation v. Chicago Title & Trust Co., 303 Ill.App.3d 484, 707 N.E.2d 637, 236 Ill.Dec. 510 (1st Dist. 1999)) or unless the verdict is based on an erroneous ruling that might have misled the jury, on a clear and palpable mistake, or on passion and prejudice (City of Chicago v. Vaccarro, 408 Ill. 587, 97 N.E.2d 766 (1951); Department of Transportation v. Bolis, 313 Ill.App.3d 982, 730 N.E.2d 1152, 246 Ill.Dec. 687 (3d Dist. 2000)). The limitations of appellate review and the influence of the harmless error doctrine were highlighted when the appellate court refused to reverse a substantial jury verdict even though it ruled the trial court had abused its discretion and erred by excluding evidence of an owner’s statements concerning the value of the subject property. Oak Brook Park District v. Oak Brook Development Co., 170 Ill.App.3d 221, 524 N.E.2d 213, 120 Ill.Dec. 448 (2d Dist. 1988). Both the appellate court in Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 250 Ill.App.3d 665, 619 N.E.2d 1321, 1326, 189 Ill.Dec. 272 (2d Dist. 1993), and the Supreme Court in Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 163 Ill.2d 498, 645 N.E.2d 896, 899, 206 Ill.Dec. 644 (1994), restated the limited nature of appellate review. Citing Oak Brook Park District, supra, the appellate court noted that “in case of trial court error, a reversal is called for only if the evidence improperly admitted was sufficiently prejudicial to change the outcome of the trial.” 619 N.E.2d at 1326. When the Supreme Court considered the property owners’ contention that one of the numerous experts for the condemnor had been permitted to testify erroneously about the contents of zoning board minutes, the Supreme Court stressed the alleged error must be placed in the perspective of the entire case. 645 N.E.2d at 899 (“The law of this State is well established that the improper admission or exclusion of value evidence does not constitute reversible error when there are other witnesses and evidence as to value on both sides and the jury has the opportunity of viewing the property and weighing the conflicting evidence.”).



On the other hand, one month before issuing its opinion in Heritage Standard Bank, the Supreme Court handed down an opinion specifically rejecting an argument that any error in excluding an appraiser’s testimony does not require reversal. The Supreme Court asserted that reversal and a new trial are warranted “if the trial court made an erroneous ruling which might have misled the jury and which amounts to prejudicial error.” Illinois State Toll Highway Authority v. American National Bank & Trust Company of Chicago, 162 Ill.2d 181, 642 N.E.2d 1249, 1256, 205 Ill.Dec. 132 (1994). As a result of the appellate court’s reluctance to disturb a verdict within the range of the evidence, frequently the only basis for appealing an adverse verdict lies in a claim that the verdict was based either on an erroneous interpretation of the valuation rules or on an erroneous application of these rules to the specific property being acquired. II. [7.8] USE OF EXPERTS TO PROVE VALUATION ISSUES Most eminent domain cases involve the use of real estate appraisers who testify as to their opinion of market value of the property, the value of the property being taken, and, when appropriate, the damage to the remaining property caused by the taking. Appraisers normally will use one or more of the following three traditional methods of appraisal to arrive at an opinion of the fair cash market value of the property: a. the market or comparable-sales approach, in which the appraiser obtains recent sales of

comparable properties, compares the sales to the subject property, makes adjustments, and forms an opinion of what price the subject property would bring;

b. the cost approach, in which the appraiser forms an opinion of the value of the land as if

vacant and then adds to it the depreciated reproduction costs of the improvements; and c. the income approach, in which the appraiser measures the present value of the future

benefits of property ownership by capitalizing the income stream and value of property reversion into a present, lump-sum value.

See American Institute of Real Estate Appraisers, THE APPRAISAL OF REAL ESTATE (14th ed. 2013). Illinois courts have accepted each approach “if the proper circumstances are present” (People ex rel. Director of Finance v. Young Women’s Christian Association of Springfield, 74 Ill.2d 561, 387 N.E.2d 305, 310, 25 Ill.Dec. 649 (1979)), but they also have imposed strict requirements on the use of each approach due to the unique nature of eminent domain proceedings. As a result, an attorney should always review any legal barriers to a particular approach with the valuation experts. If the appraiser considers improper elements, his or her testimony is incompetent and on motion may be stricken. City of Chicago v. Giedraitis, 14 Ill.2d 45, 150 N.E.2d 577 (1958); Chicago & Illinois Midland Ry. v. Crystal Lake Industrial Park, Inc., 225 Ill.App.3d 653, 588 N.E.2d 337, 167 Ill.Dec. 696 (3d Dist. 1992) (appraiser excluded for using valuation theories previously barred by motions in limine and expert discovery rules).



A. [7.9] Appraisers as Expert Witnesses Initially, real estate valuation witnesses were not considered expert witnesses because their opinions were not presented in the usual form as an answer to a hypothetical question. City of Chicago v. Lehmann, 262 Ill. 468, 104 N.E. 829 (1914). The courts also may have felt that appraisal testimony was based on opinion rather than scientific fact. Subsequent Illinois decisions overturned these cases, and an appraiser is now considered to be an expert witness. As a result, the rules governing the testimony of expert witnesses are applied to the testimony of appraisers. Because an appraiser is normally retained by the client or the attorney, the appraiser most often is a “controlled expert witness” as defined by S.Ct. Rule 213(f)(3). The Illinois Supreme Court in Wilson v. Clark, 84 Ill.2d 186, 417 N.E.2d 1322, 49 Ill.Dec. 308 (1981), mandated the application of Fed.R.Evid. 703 and 705 to the testimony of expert witnesses in Illinois state courts. The Second District then held that real estate appraisers were expert witnesses as contemplated by the federal rules and, therefore, that their testimony should be governed by these rules. Department of Transportation v. Beeson, 137 Ill.App.3d 908, 485 N.E.2d 511, 512, 92 Ill.Dec. 700 (2d Dist. 1985). The Supreme Court confirmed the applicability of Fed.R.Evid. 703 and 705 to the testimony of a real estate appraiser in City of Chicago v. Anthony, 136 Ill.2d 169, 554 N.E.2d 1381, 144 Ill.Dec. 93 (1990). The Illinois Supreme Court adopted the Illinois Rules of Evidence, effective January 1, 2011. Article VII of the Illinois Rules of Evidence is entitled “Opinions and Expert Testimony.” It includes Ill.R.Evid. 702 (“Testimony by Experts”), 703 (“Bases of Opinion Testimony by Experts”), 704 (“Opinion on Ultimate Issue”), and 705 (“Disclosure of Facts or Data Underlying Expert Opinion”). All of these rules may affect testimony by appraisers. B. [7.10] Bases of Appraisers’ Opinions Fed.R.Evid. 703 permits an expert to base an opinion on facts or data from one of three sources: 1. evidence admitted in court; 2. personal observation outside court; or 3. data presented to the expert outside court and outside his or her own perception. By allowing the last category, Fed.R.Evid. 703 broadens the base for expert opinions. However, to avoid problems that may occur because of the enlargement of the permissible data on which an expert can rely, the rule requires that the facts or data must “be of a type reasonably relied upon by experts in the particular field.” Advisory Committee Notes, 1972 Proposed Rules, Fed.R.Evid. 703. According to the Advisory Committee Notes:

If it be feared that enlargement of permissible data may tend to break down the rules of exclusion unduly, notice should be taken that the rule requires that the facts or data “be of a type reasonably relied upon by experts in the particular field.” Id.



While Ill.R.Evid. 703 does not duplicate the words of its federal counterpart, it reflects similar concepts. The Illinois rule permits an appraiser to base an opinion on facts or data known at or before the hearing. And it provides that if the facts or data are “of a type reasonably relied upon by experts in the particular field in forming opinions or inferences upon the subject, the facts or data need not be admissible in evidence.” Id. C. [7.11] Facts and Data Reasonably Relied On and Admissibility Whether the facts or data are of a type reasonably relied on is a preliminary question for the trial court. Department of Transportation ex rel. State of Illinois v. First National Bank of Arcola, 241 Ill.App.3d 601, 609 N.E.2d 389, 182 Ill.Dec. 86 (4th Dist. 1993); Bauman v. Centex Corp., 611 F.2d 1115 (5th Cir. 1980); United States v. Lawson, 653 F.2d 299 (7th Cir. 1981); Barrel of Fun, Inc. v. State Farm Fire & Casualty Co., 739 F.2d 1028 (5th Cir. 1984). In determining whether the expert’s reliance is reasonable, the trial courts must make a two-step analysis that determines whether (1) the information is of the type normally relied on by experts in the field and (2) the particular information used by this expert is sufficiently trustworthy to make such reliance reasonable. Michael H. Graham, Expert Witness Testimony and the Federal Rules of Evidence: Insuring Adequate Assurance of Trustworthiness, 1986 U.Ill.L.Rev. 43, 75. Ill.R.Evid. 703 specifically permits an expert to base an opinion on facts or data that “need not be admissible in evidence.” The Illinois Rules of Evidence became effective on January 1, 2011. But evidentiary decisions before 2011 may still be relevant in construing the meaning of these rules, particularly in determining their application to expert testimony. See, e.g., Solis v. BASF Corp., 2012 IL App (1st) 110875, 979 N.E.2d 419, 365 Ill.Dec. 815. In People v. Anderson, 113 Ill.2d 1, 495 N.E.2d 485, 99 Ill.Dec. 104 (1986), the Supreme Court expanded on its decision in Wilson v. Clark, 84 Ill.2d 186, 417 N.E.2d 1322, 49 Ill.Dec. 308 (1981), and held that an expert could testify on direct examination as to the underlying basis of his or her expert opinion, despite the fact that such basis was independently inadmissible due to the hearsay evidentiary rule. The Supreme Court held that a psychiatrist should have been permitted to testify on direct examination regarding the content of hearsay records he had used in forming his opinion. The court held that the testimony regarding the facts in the underlying reports was not admissible if offered for its truth, but it was admissible for the limited purpose of explaining the basis for the expert witness’s opinion. The court noted, however:

A trial judge, of course, need not allow the expert to recite secondhand information when its probative value in explaining the expert’s opinion pales beside its likely prejudicial impact or its tendency to create confusion. 495 N.E.2d at 490.

Thus, while Wilson and its progeny abolish some of the traditional requirements as to the underlying basis of foundation testimony, they do not eliminate others, such as relevancy. The tension between those advocating the full elucidation of an expert’s opinion and those concerned with the presentation of inadmissible evidence under the guise of the basis for an expert opinion is apparent in many decisions. For example, in Melecosky v. McCarthy Bros., 115 Ill.2d 209, 503 N.E.2d 355, 104 Ill.Dec. 798 (1986), a divided Supreme Court held that a non-treating physician could render an expert opinion at trial even if it was based on the subjective



statements of pain by the plaintiff. In so doing, the Supreme Court reversed the opinion of the appellate court and overruled its prior holding in Jensen v. Elgin, Joliet & Eastern Ry., 24 Ill.2d 383, 182 N.E.2d 211 (1962). Justices Ryan and Miller filed a sharp dissenting opinion, stating that “the majority opinion expands Rules 703 and 705 to the point that the accepted principles governing the admissibility of evidence are abandoned.” 503 N.E.2d at 359. This dissent forms the background for the subsequent decision by the Second District in Lovelace v. Four Lakes Development Co., 170 Ill.App.3d 378, 523 N.E.2d 1335, 120 Ill.Dec. 424 (2d Dist. 1988), which upheld the exclusion of purported foundation testimony. Drawing a distinction between the exclusion of the expert’s entire opinion, as in Melecosky, supra, and the exclusion only of testimony explaining the basis for the opinion, the appellate court held that the proponent of the foundation testimony must prove that the evidence is of a type customarily relied on by experts and that the evidence is trustworthy so as to make the reliance reasonable. In the eminent domain field, the tension arises when an appraiser is asked to describe the sales of comparable properties that were used as the basis for the expert’s opinion. Information concerning sales of other properties could be presented to the jury as independent evidence of value by having a comparable-sales hearing or as foundation information leading to an expert opinion of value. When used only as foundation evidence, the courts formerly placed constraints on an appraiser’s ability to describe to the jury his or her use of sales evidence in formulating an opinion of value based on the market approach. For example, in Lake County Forest Preserve District v. Bank & Trust Company of Arlington Heights, 106 Ill.App.3d 856, 436 N.E.2d 237, 62 Ill.Dec. 487 (2d Dist. 1982), the appellate court ruled that an appraiser could describe in general terms the sales that were considered but could not mention the actual sales price unless the sale had previously been introduced in evidence as a comparable sale. Whether the prohibition barring mention of the price of foundation sales survived the adoption of Fed.R.Evid. 703 in Wilson, supra, was the issue before the appellate court in Department of Transportation v. Beeson, 137 Ill.App.3d 908, 485 N.E.2d 511, 92 Ill.Dec. 700 (2d Dist. 1985). In Beeson, the condemnor filed a motion in limine to preclude valuation witnesses from testifying to the dollar amounts of sales they had considered in making their appraisal. The trial court granted the motion. Finding that valuation witnesses are expert witnesses, that the rationale of Wilson applies to valuation witnesses, and that, as a result, Fed.R.Evid. 703 and 705 govern the testimony of valuation witnesses, the appellate court reversed, stating:

The defendant claims that since Wilson did not limit the application of Rules 703 and 705 to any particular type of case, the Rules should be applied to the testimony of valuation witnesses, with the result being that all sales considered by valuation witnesses now are admissible. We agree. 485 N.E.2d at 512.

Later in the opinion, responding to the argument that appraisals are not made in accordance with uniform standards and, lacking standards, valuation witnesses are unable to use information “of a type reasonably relied upon by experts in the particular field,” as required by the Advisory Committee Notes, 1972 Proposed Rules, Fed.R.Evid. 703, the appellate court stated:

We disagree with the plaintiff’s argument. The rule only requires that the facts or data be of a type reasonably relied on. It is common knowledge that valuation



witnesses routinely consider different comparable sales when determining the value of a particular piece of property. There is no requirement in the rule that a uniform standard exists. The ultimate decision of comparability rests with the trier of fact. Although more responsibility will be placed on a jury if more evidence is admitted than traditionally, a juror should be able to synthesize the information he or she received in order to understand the differences between the proffered sales and the subject property. 485 N.E.2d at 513.

Because neither party contested the comparability of the sales used by the appraiser (the only contest centered on the method of their introduction in evidence), the Beeson court was not presented with a challenge to the validity of the foundation of evidence. This challenge arose in Department of Transportation ex rel. People v. Amoco Oil Co., 174 Ill.App.3d 479, 528 N.E.2d 1018, 124 Ill.Dec. 127 (2d Dist. 1988), when the condemnor presented a motion in limine seeking to exclude evidence of certain sales on the basis that the sales were not comparable. In its opinion, the appellate court, relying on Beeson, upheld the trial court’s decision to permit appraisers to testify fully about sales. However, it qualified the Beeson opinion in two key respects. First, whereas in Beeson, the appellate court stated “that all sales considered by valuation witnesses now are admissible” (485 N.E.2d at 512), in Amoco, the appellate court qualified this by stating “that all sales reasonably relied upon by experts in the field are admissible” [emphasis added] (528 N.E.2d at 1025). Second, Amoco grants the trial court the discretion to hold a separate hearing to “determine whether the expert’s opinion utilizes material reasonably relied upon by experts in the field.” 528 N.E.2d at 1026. Following Beeson and Amoco in the Second District, the First District confronted the issue of the extent to which an appraiser may testify concerning comparable sales as a basis for an opinion in Department of Conservation of State of Illinois v. Dorner, 192 Ill.App.3d 333, 548 N.E.2d 749, 139 Ill.Dec. 364 (1st Dist. 1989). The appellate court stated, in dicta, that an appraiser could testify concerning sales that had not been admitted in evidence if the sales were in fact comparable. However, if the sales were not comparable, the Dorner court held that they would not qualify as sales of the type normally relied on by an expert, and thus the trial court could use its discretion to exclude testimony concerning the sales even if the appraiser had relied on them. While it cited Amoco and Beeson with approval in its decision, the Dorner court actually contradicted Beeson’s dicta “that all sales considered by valuation witnesses now are admissible” (485 N.E.2d at 512). In City of Chicago v. Anthony, 136 Ill.2d 169, 554 N.E.2d 1381, 1391, 144 Ill.Dec. 93 (1990), the Illinois Supreme Court decided the issue and specifically disagreed with the Beeson court’s statement that Wilson, supra, had “altered the rule of judicial discretion in the admissibility of comparable sales” (485 N.E.2d at 512). The Supreme Court outlined the following analysis to be undertaken by a trial judge when confronted with an objection to an expert’s proposed testimony of the facts or data underlying his or her opinion:

We hold that it is for the circuit court, in the exercise of its discretion, to determine whether the underlying facts or data upon which an expert bases an opinion are of a type reasonably relied upon by experts in the particular field. Such a determination shall not be disturbed unless there has been an abuse of discretion.



The opinion of an expert that the underlying facts or data upon which he or she seeks to base an opinion are of a type reasonably relied upon by experts in the particular field is a factor to be considered by a circuit court in the exercise of its discretion. This, however, does not allow the circuit court to “abdicate its independent responsibilities to decide if the bases meet minimum standards of reliability as a condition of admissibility.” [In re “Agent Orange” Product Liability Litigation, 611 F.Supp. 1223, 1245 (E.D.N.Y. 1985), aff’d, 818 F.2d 187 (2d Cir. 1987).] The reason for the substantive inadmissibility of the facts or data upon which an expert relies must be considered by the circuit court. If another rule of law applicable to the case excludes the information sought to be relied upon by the expert, the information may not be permitted to come before the jury under the guise of a basis for the opinion of the expert.

* * * In this case, it is eminent domain law which controls the admissibility of evidence for its truth as well as for the limited purpose of explaining the basis for an expert’s opinion pursuant to Rule 703. 554 N.E.2d at 1389.

In support of its approach, the Supreme Court cited with approval “Agent Orange” and Barrel of Fun, supra. Both of these decisions emphasize that the trial court, rather than the expert, has the ultimate responsibility to independently determine whether the bases for the expert’s opinion meet the reliability standard. In addition, even if the bases for the expert’s opinion meet the reliability standard, the trial court may have to make a further determination as to whether the bases are subject to exclusion due to the application of other rules of evidence that outweigh the interests of revealing these particular facts or data to the jury. The Anthony court held the trial court’s determination of these questions should not be overruled unless there has been an abuse of discretion. If an appraiser fails to fully describe the bases for the valuation opinion on direct examination, the trial court should permit the cross-examiner to question and elicit all the facts, data, and opinions that form the appraiser’s opinion. City of Chicago v. Eychaner, 2015 IL App (1st) 131833, 26 N.E.3d 501, 389 Ill.Dec. 411. The ground rules established by Anthony led the appellate court to reverse the trial court in Illinois State Toll Highway Authority v. Dicke, 208 Ill.App.3d 158, 566 N.E.2d 1003, 1011, 153 Ill.Dec. 153 (2d Dist. 1991). During trial, the owner’s appraisers testified they had considered, in arriving at their opinion of market value, an offer to purchase made to the owner after the valuation date. The trial court, over objection, permitted reference to the offer on the basis that the appraiser had relied on it in forming an expert opinion. Reversing the trial court’s decision to permit testimony about the offer, the appellate court noted the general rule barring evidence of offers to purchase after filing the complaint. Department of Public Works & Buildings v. Finks, 10 Ill.2d 15, 139 N.E.2d 267 (1956). Then, relying on Anthony, the appellate court in Dicke noted:



The mere fact that an expert has based his opinion on some information or data does not automatically ensure its admissibility under Rule 703. . . . Within the context of the instant cause, it is eminent domain law which controls the admissibility of evidence that is offered either for its truth or for the limited purpose of explaining the basis for an expert’s opinion. 566 N.E.2d at 1011.

Adhering to the Anthony rule, the appellate court held the trial court has the responsibility to determine whether sales used by an appraiser are of the type that would be reasonably relied on by an expert in the field. First National Bank of Arcola, supra. If an appraiser attempts to rely on the testimony or information provided by another expert, such as an engineer, the appraiser must be prepared to prove that such reliance is reasonable and the information, or expert opinion, is relevant to the appraiser’s opinion of market value. Department of Transportation v. LaSalle National Bank, 251 Ill.App.3d 901, 623 N.E.2d 390, 191 Ill.Dec. 145 (2d Dist. 1993) (upholding admissibility of engineer’s testimony regarding existence of wetlands on site); Chicago & Illinois Midland Ry. v. Crystal Lake Industrial Park, Inc., 225 Ill.App.3d 653, 588 N.E.2d 337, 167 Ill.Dec. 696 (3d Dist. 1992) (error to permit appraiser to testify regarding sand and gravel content of property when source of appraiser’s information was not adequately documented). D. [7.12] Gatekeeper Role of Trial Judge As explained in §7.11 above, the Illinois Supreme Court empowered the trial judge to determine whether the expert’s opinion was based on facts or data that were of a type reasonably relied on by experts in the relevant field. City of Chicago v. Anthony, 136 Ill.2d 169, 554 N.E.2d 1381, 144 Ill.Dec. 93 (1990). Federal courts have taken a similar approach. The United States Supreme Court emphasized the gatekeeper role of the trial judge when presented with an objection to proposed expert testimony in Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579, 125 L.Ed.2d 469, 113 S.Ct. 2786, 2799 (1993), stating that “the Rules of Evidence — especially Rule 702 — do assign to the trial judge the task of ensuring that an expert’s testimony both rests on a reliable foundation and is relevant to the task at hand.” The expert testimony at issue in Daubert concerned scientific testimony, i.e., whether the drug Bendectin caused birth defects. But federal courts have applied a Daubert analysis to valuation testimony in cases such as Frymire-Brinati v. KPMG Peat Marwick, 2 F.3d 183 (7th Cir. 1993), and United States v. 14.38 Acres of Land, More or Less, Situated in Leflore County, State of Mississippi, 884 F.Supp. 224 (N.D.Miss. 1995), vacated, 80 F.3d 1074 (5th Cir. 1996). Six years after Daubert, supra, the United States Supreme Court extended the federal judge’s gatekeeper role to examine for reliability and relevance to all expert testimony in Kumho Tire Co. v. Carmichael, 526 U.S. 137, 143 L.Ed.2d 238, 119 S.Ct. 1167, 1174 – 1175 (1999). Upholding a trial court’s exclusion of a tire failure analyst’s expert testimony because his methodology was unreliable, the Supreme Court held:

We conclude that Daubert’s general principles apply to the expert matters described in Rule 702. The Rule, in respect to all such matters, “establishes a standard of



evidentiary reliability.” 509 U.S., at 590, 113 S.Ct. 2786. It “requires a valid . . . connection to the pertinent inquiry as a precondition to admissibility.” Id., at 592, 113 S.Ct. 2786. And where such testimony’s factual basis, data, principles, methods, or their application are called sufficiently into question . . . the trial judge must determine whether the testimony has “a reliable basis in the knowledge and experience of [the relevant] discipline.” 509 U.S., at 592, 113 S.Ct. 2786. 119 S.Ct. at 1175.

Federal district courts have applied the Kumho Tire directives for reviewing expert testimony to real estate valuation testimony. E.g., Cayuga Indian Nation of New York v. Pataki, 83 F.Supp.2d 318 (N.D.N.Y. 2000); Adams v. NVR Homes, Inc., 141 F.Supp.2d 554 (D.Md. 2001); Rockies Express Pipeline, LLC v. Burtle, 492 Fed.Appx. 666 (7th Cir. 2012) (upholding exclusion of appraisal testimony because seven of ten alleged comparable sales were too dissimilar). Although it did not cite either Daubert, supra, or Kumho Tire, supra, the Illinois appellate court upheld the trial court’s exclusion of an appraisal because the appraiser’s highest and best use opinion “lacked a proper evidentiary foundation and, given the unique facts of this case, the trial court properly barred its introduction as evidence under principles of fundamental fairness.” City of Quincy, Illinois v. Diamond Construction Co., 327 Ill.App.3d 338, 762 N.E.2d 710, 715, 261 Ill.Dec. 141 (4th Dist. 2002). How the gatekeeper theme squares with the Illinois Supreme Court’s decision in Donaldson v. Central Illinois Public Service Co., 199 Ill.2d 63, 767 N.E.2d 314, 262 Ill.Dec. 854 (2002), is an interesting question. Donaldson reaffirmed the Illinois Supreme Court’s position that the admissibility of expert testimony that uses new or novel scientific principles or techniques in Illinois is governed by the Frye test (Frye v. United States, 293 F. 1013 (D.C.Cir. 1923)). In so doing, the court expressly rejected submitting expert testimony to the Frye-plus-reliability standard. This standard, which was best articulated in Harris v. Cropmate Co., 302 Ill.App.3d 364, 706 N.E.2d 55, 235 Ill.Dec. 795 (4th Dist. 1999), incorporates some of the factors raised in Daubert, supra. Ill.R.Evid. 702 follows the Donaldson rationale. However, despite its indirect renunciation of a Daubert-type approach to expert testimony, the Donaldson opinion also contains a footnote that states: “[t]he parties have not argued, and we have not considered, the adoption of a new standard consistent with . . . Daubert . . . . We will not raise this issue sua sponte.” 767 N.E.2d at 325 n.1. There is no doubt cases will test the meaning and parameters of Donaldson’s effect on expert testimony in condemnation cases. Some commentators believe the Donaldson approach provides a more limited “gatekeeping” role for the trial court. See Michael H. Graham, GRAHAM’S HANDBOOK OF ILLINOIS EVIDENCE §702.10 (2016 ed.). But, even after Donaldson, an experienced expert may not present an opinion based on pure conjecture. People v. Ceja, 204 Ill.2d 332, 789 N.E.2d 1228, 273 Ill.Dec. 796 (2003). The Supreme Court in Anthony, supra, made clear that it is the trial court, not the expert, who has the final word in determining what testimony a jury will hear. In a condemnation case decided two years after Donaldson, supra, the appellate court referred with approval to the trial court’s role as a gatekeeper having an independent responsibility to decide if the bases of an appraiser’s opinion are of a type reasonably relied on



and meet minimum standards of reliability. Southwestern Illinois Development Authority v. Al-Muhajirum, 348 Ill.App.3d 398, 809 N.E.2d 730, 284 Ill.Dec. 164 (5th Dist. 2004). The appellate court in Al-Muhajirum cited Anthony, supra, as authority for its opinion but did not mention Donaldson. 809 N.E.2d at 732 – 733. The appropriate role of the trial court when ruling on the basis of an expert’s opinion is still somewhat uncertain. Compare Snelson v. Kamm, 204 Ill.2d 1, 787 N.E.2d 796, 272 Ill.Dec. 610 (2003), with In re Commitment of Simons, 213 Ill.2d 523, 821 N.E.2d 1184, 290 Ill.Dec. 610 (2004). A 2014 invocation of the trial judge’s gatekeeper role in a condemnation case is Department of Transportation ex rel. People v. Raphael, 2014 IL App (2d) 130029, ¶16, 9 N.E.3d 1120, 381 Ill.Dec. 1, in which the appellate court stated, when reviewing the admissibility of appraisal opinions:

Whether the facts and data relied upon by a given appraiser are of a type reasonably relied upon by experts in the field of real estate appraisals is a determination left to the sound discretion of the trial court. City of Chicago v. Anthony, 136 Ill.2d 169, 186, 144 Ill.Dec. 93, 554 N.E.2d 1381 (1990). Thus, we will not disturb a trial court’s decision to bar an appraiser’s testimony absent a clear abuse of discretion.

III. VALUATION IN COMPLETE ACQUISITIONS A. Just Compensation 1. [7.13] Just Compensation as Fair Cash Market Value The constitutional mandate to pay just compensation gives the courts freedom to determine what would be appropriate compensation in each case. As Justice Black stated in United States v. Commodities Trading Corp., 339 U.S. 121, 94 L.Ed. 707, 70 S.Ct. 547, 549 (1950):

This Court has never attempted to prescribe a rigid rule for determining what is “just compensation” under all circumstances and in all cases. Fair market value has normally been accepted as a just standard. But when market value has been too difficult to find, or when its application would result in manifest injustice to owner or public, courts have fashioned and applied other standards. . . . Whatever the circumstances under which such constitutional questions arise, the dominant consideration always remains the same: What compensation is “just” both to an owner whose property is taken and to the public that must pay the bill?

In United States v. Norwood, 602 F.3d 830 (7th Cir. 2010), Judge Posner elaborated on the distinction between “just compensation,” which is based on market value, and “common-law compensation” or “full compensation,” which can include additional items, such as moving expenses.



The Illinois state courts have accepted fair market value as the standard for determining just compensation. In 1977, the Illinois Supreme Court, through Justice Clark, observed: “Just compensation is the fair market value of the property at its highest and best use on the date of filing of the petition.” Department of Public Works & Buildings v. Association of Franciscan Fathers of State of Illinois, 69 Ill.2d 308, 371 N.E.2d 616, 618, 13 Ill.Dec. 681 (1977). This pronouncement follows a long line of cases reaching back to the first case decided under the Eminent Domain Act of 1872 in the September 1872 term of the Illinois Supreme Court, in which the court stated: “Of course the true test as to the damages to be paid, is the market value of the land.” Haslam v. Galena & Southern Wisconsin R.R., 64 Ill. 353, 355 (1872). In City of Chicago v. Cunnea, 329 Ill. 288, 160 N.E. 559, 562 (1928), the Supreme Court elaborated on the meaning of “just compensation”:

Just compensation means the payment of such sum of money as will make the owner whole, so that on receipt of the compensation he will not be poorer by reason of his property being taken. . . . The measure of compensation is a sum of money that is the equivalent of the value of the property. That means such a sum as the property would sell for cash under ordinary circumstances, assuming that the owner is willing to sell and the purchaser willing to buy. [Citations omitted.]

Cunnea not only sets forth the standard of fair market value for ascertaining just compensation but also serves to illustrate the limits created by this standard. In this case, the City of Chicago condemned property on three lots. At trial, the owners’ attorney argued the owners were entitled to receive enough money to purchase the same type of house after the acquisition as they had before. Holding that the attorney’s argument was directed toward the replacement value of the house, rather than its market value, the Supreme Court reversed. As is discussed in §§7.27 – 7.32 below, the fair market standard excludes several aspects of value, such as replacement value, particular value to the specific owner, sentimental value, or ongoing business value, which, at first glance, might be considered to be a part of just compensation. The courts created these restrictions on compensation for two reasons. First, the fair market rule provides a neutral or objective method of determining just compensation and therefore achieves a balance between the rights of the public and the rights of the individual. Second, and more important, the fair market rule focuses on the property itself — what is being condemned — rather than on the person who owns the property or the public body that is acquiring it. Both the Fifth Amendment to the United States Constitution (“nor shall private property be taken for public use, without just compensation”) and Article I, §15, of the Illinois Constitution (“[p]rivate property shall not be taken or damaged for public use without just compensation as provided by law”) are directed to the property itself, not to the rights of the individual, as are the other portions of the federal Bill of Rights and the Illinois Bill of Rights. If one keeps in mind that an eminent domain proceeding is brought to ascertain the compensation to be paid for the acquisition of property, not for the loss to an individual, the valuation rules make more sense. The federal and state constitutional requirements to pay just compensation do not include any requirement, unless specifically authorized by statute, to pay the property owners’ legal fees or litigation expenses. Thus, the American rule, which requires each side to shoulder its own



attorneys’ fees and expenses, remains the default rule in eminent domain litigation. Department of Transportation of State of Illinois v. Carriage Hills Kennels, 255 Ill.App.3d 43, 627 N.E.2d 303, 194 Ill.Dec. 187 (1st Dist. 1993); Illinois State Toll Highway Authority v. American National Bank & Trust Company of Chicago, 162 Ill.2d 181, 642 N.E.2d 1249, 205 Ill.Dec. 132 (1994). However, the Eminent Domain Act includes an offer-of-judgment procedure in certain types of condemnation cases. 735 ILCS 30/10-5-110. Loosely patterned after Fed.R.Civ.P. 68, the procedure could require the condemnor to pay the owners’ legal fees and expenses. A second statutory exception to the American rule exists when either the condemnor is judged not to have the right to acquire the property or the condemnor abandons the proceedings. Under 735 ILCS 30/20-5-45 and 30/10-5-70(a), the owner in such cases may recover its reasonable attorneys’ fees, costs, and expenses. Village of Cary v. Trout Valley Ass’n, 297 Ill.App.3d 63, 696 N.E.2d 1154, 231 Ill.Dec. 583 (2d Dist. 1998). Should “just compensation” include the full market value of the property if, between the date of filing the condemnation case and the date title is conveyed to the condemning authority, the owner sells easements over the property to nonparties to the litigation? This interesting question drew a two-one decision by the appellate court in Department of Natural Resources of State of Illinois v. Brauer, 339 Ill.App.3d 723, 791 N.E.2d 120, 274 Ill.Dec. 324 (3d Dist. 2003). Because the condemning authority did not explicitly prove the easements had diminished the value of the property, the majority held the condemning authority was not entitled to a setoff and had to pay full market value for the property on the date of filing the condemnation case. 2. [7.14] Date of Valuation Until 2007, both Illinois statutes and caselaw uniformly directed that the date for valuing property in an Illinois eminent domain proceeding was the date of filing the complaint to condemn. But the Eminent Domain Act and the Illinois Supreme Court’s decision in Forest Preserve District of DuPage County v. First National Bank of Franklin Park, 2011 IL 110759, 961 N.E.2d 775, 356 Ill.Dec. 386, created exceptions to the “date of value is the date of filing” rule. The Eminent Domain Act of 1972 provided that the fair cash market value of property in a condemnation proceeding “shall be determined and ascertained as of the date of filing the complaint to condemn.” Ill.Rev.Stat. (1973), c. 47, ¶9.7. The legislature restated this provision when it enacted the Illinois Code of Civil Procedure (former 735 ILCS 5/7-121). Section 10-5-60 of the EDA restates the normal rule that the date of filing the complaint is the date of valuation but then offers the following two exceptions:

(i) in the case of property not being acquired under Article 20 (quick-take), if the trial commences more than 2 years after the date of filing the complaint to condemn, the court may, in the interest of justice and equity, declare a valuation date no sooner than the date of filing the complaint to condemn and no later than the date of commencement of the trial; and



(ii) in the case of property that is being acquired under Article 20 (quick-take), if the trial commences more than 2 years after the date of filing the complaint to condemn, the court may, in the interest of justice and equity, declare a valuation date no sooner than the date of filing the complaint to condemn and no later than the date on which the condemning authority took title to the property. 735 ILCS 30/10-5-60.

The standard for granting a new valuation date imposed on the trial court — “in the interest of justice and equity” — apparently grants broad, but not unfettered, discretion. Id. On a practical level, changing the valuation requires the parties to expend additional costs in new appraisers, etc. It probably also requires entry of a new case-management schedule to conform with the requirement in S.Ct. Rule 218(c) that discovery must be completed no later than 60 days before trial. 735 ILCS 30/90-5-5 provides that this change applies to complaints filed after the effective date of the EDA, January 1, 2007. In 2011, the Illinois Supreme Court introduced a constitutional perspective to the date of valuation question when it published its opinion in First National Bank of Franklin Park. The forest preserve district had filed its complaint in 1999, but the jury trial did not occur until 2007. The owner asserted that his constitutional right to receive just compensation had been violated because the jury’s award was based on the market value of the property in 1999 — as directed by the applicable statute (former 735 ILCS 5/7-121, now 735 ILCS 30/10-5-60) — even though the property’s value had allegedly substantially increased between 1999 and 2007, the date of trial. Holding that the Fifth Amendment’s Just Compensation Clause required the date of valuation to be the date of taking rather than the date of filing, the appellate court vacated the jury’s verdict and remanded for further proceedings by the trial court to determine if the current value of the property was equivalent to the value on the filing date. Forest Preserve District of DuPage County v. First National Bank of Franklin Park, 401 Ill.App.3d 966, 930 N.E.2d 477, 341 Ill.Dec. 267 (2d Dist. 2010). While the Supreme Court acknowledged that its analysis does not consider the effect of the changes in the date of valuation provisions in the EDA, the Supreme Court based its opinion on constitutional requirements. Therefore, its reasoning applies to cases filed after the January 1, 2007, changes to §10-5-60. The Supreme Court’s reasoning is relatively straightforward, but the practical effects of its decision are not. The court correctly assumes the Fifth Amendment’s requirement that just compensation be paid to an owner is applicable to state eminent domain proceedings. The court then attempts to apply to Illinois eminent domain proceedings the interpretation of the Fifth Amendment’s just compensation requirement made by the United States Supreme Court in Kirby Forest Industries, Inc. v. United States, 467 U.S. 1, 81 L.Ed.2d 1, 104 S.Ct. 2187 (1984). In Kirby, the United States Supreme Court held that property must be valued as of the date of taking to meet constitutional standards. The Illinois Supreme Court reviewed Illinois law to determine when a taking occurs in an Illinois eminent domain case and concluded:



We find that a taking in Illinois for the purposes of applying Kirby occurs on the date that the government (1) deposits the amount of compensation that has been ascertained and awarded, and (2) acquires title and the right to possess the property. [Emphasis in original.] First National Bank of Franklin Park, supra, 2011 IL 110759 at ¶40.

Because First National Bank of Franklin Park did not involve use of quick-take proceedings, the taking would not occur until after the jury had rendered its verdict and the forest preserve district had deposited the jury award. The Supreme Court concluded that the jury’s award, which was based on a 1999 valuation date, would not necessarily represent the market value of the property on the taking date, which would now be in 2011, because the forest preserve district had yet to take title and possession. The Supreme Court ruled:

The appellate court also correctly vacated the jury’s verdict as to the value of the property, subject to a possible reinstatement by the trial court following a hearing on just compensation using the current value of the property. 2011 IL 110759 at ¶70.

First National Bank of Franklin Park leaves unanswered a host of practical questions, including the following: a. How does the “date of value is the date of taking” requirement square with the valuation provisions in §10-5-60? b. If the trial judge has the right to vacate a jury’s verdict because the judge concludes that the jury’s verdict does not represent the correct value, how does this right square with the Illinois constitutional right to have just compensation determined by a jury? c. In a non-quick-take situation, the date of taking will always occur after the jury trial. What valuation date is to be used to guide valuation testimony at the jury trial? d. How does the trial court proceed during the posttrial hearing in a partial takings case because in that situation the jury has not determined the value of the whole property? e. How does the trial court handle the case-management requirements in S.Ct. Rule 218 if the valuation date is to be the date of trial, as Kirby, supra, proclaims? The First District Appellate Court relied on First National Bank of Franklin Park to determine whether a person was a lessee as of the date of taking and therefore could claim a portion of the just compensation. Holding that the lease had expired after the date of filing the condemnation case but before the date of taking, the appellate court construed the Supreme Court’s decision, stating:

The court emphasized that prior rulings and comments placing the time of a taking as of the date of the filing of the petition for condemnation merely held that the date of filing was the date used for determining the value of the property and did not disturb these rulings on that issue. Public Building Commission of Chicago v. Yellen, 2013 IL App (1st) 112638, ¶31, 986 N.E.2d 706, 369 Ill.Dec. 393.



Because the EDA retains the former statutory provision that property is to be valued “as of the date of filing the complaint to condemn” (735 ILCS 30/10-5-60) and because Yellen seems to support the date of filing rule, prior caselaw discussing the valuation date remains relevant. Enacted in 1982, the statutory directive on when to value the condemned property merely codified the previous common-law rule. From the Illinois Supreme Court decision in South Park Commissioners v. Dunlevy, 91 Ill. 49 (1878), to First National Bank of Franklin Park, supra, every Illinois court but one has upheld the date of filing valuation rule. The single exception involved the acquisition of a utility company required by its operating authority to make improvements to the utility after the filing date. The Supreme Court ruled it should be compensated for the required additional improvements. Illinois Cities Water Co. v. City of Mt. Vernon, 11 Ill.2d 547, 144 N.E.2d 729 (1957). Invoking the date of filing rule in City of Chicago v. Farwell, 286 Ill. 415, 121 N.E. 795, 796 (1918), the Supreme Court denied the owners’ request for a later valuation date due to an increase in property value after the condemnation complaint had been filed by referring to the rule as a “fixed rule” that “passed beyond the stage of discussion.” Conversely, in Forest Preserve Dist. of Cook County v. Eckhoff, 372 Ill. 391, 24 N.E.2d 52 (1939), the Supreme Court rejected the owner’s request for a jury instruction that would have directed the jury to consider the decrease of property values due to prevailing economic conditions on the date of filing the complaint, which was during the Great Depression. This rule prevailed even when the owners had strong equitable arguments. In cases such as Chicago Housing Authority v. Lamar, 21 Ill.2d 362, 172 N.E.2d 790 (1961), the Supreme Court refused to grant the owners’ motion to value the property before the condemnation petition was filed. The date of filing remained the date of valuation even though the condemnor’s precondemnation activities had adversely affected real estate values and had contributed to the property’s depreciation. It is noteworthy that the Illinois legislature solved this problem when it enacted former 735 ILCS 5/7-121 in 1982, not by giving the trial court discretion to change the valuation date, but by providing that any appreciation or depreciation in a property’s value caused by the condemnor’s improvement should be excluded from the valuation on the date of filing the complaint to condemn. City of Rock Island, Illinois v. Moline National Bank, 54 Ill.App.3d 853, 368 N.E.2d 1113, 11 Ill.Dec. 505 (3d Dist. 1977). In Department of Transportation of State of Illinois ex rel. People v. Zabel, 29 Ill.App.3d 407, 330 N.E.2d 878 (3d Dist. 1975), the appellate court prohibited the trial court from setting a date of valuation other than the filing date. In Trustees of Schools of Township No. 37 v. First National Bank of Blue Island, 49 Ill.2d 408, 274 N.E.2d 56 (1971), the Supreme Court held that, due to the date of filing rule, mere delay in bringing a case to trial did not warrant recovery of damages for the delay. A somewhat indirect exception to the date of filing valuation rule was created by the appellate court in City of Quincy, Illinois v. Diamond Construction Co., 327 Ill.App.3d 338, 762 N.E.2d 710, 261 Ill.Dec. 141 (4th Dist. 2002). The owner of an asphalt plant started to relocate equipment before the city filed its condemnation case because the owner needed to be operational at its new site by a certain date to meet contractual obligations for the next construction season. Both the city and the owner had had communications about the proposed taking before the owner decided to start the relocation process. The appraiser for the city originally appraised the property



with a highest and best use as an asphalt plant. However, as of the date of filing the condemnation case, the city’s appraiser opined the highest and best use was not an asphalt plant but vacant industrial. The revised appraised value of the entire tract was approximately one sixth of the earlier value as an asphalt plant. Responding to a motion in limine, the trial court barred use of the vacant industrial appraisal. The appellate court acknowledged the date of filing valuation rule but nevertheless affirmed the trial court’s decision to exclude the vacant industrial appraisal, holding:

[W]e conclude the issue of highest and best value may be a question of law for the trial judge when the evidence is so inherently improbable it should be excluded from the jury. Whether the issue in this case is fundamental fairness to [the owner] or the inherent improbability of the evidence of highest and best use as stated in Briggs’ second appraisal, the trial judge correctly ruled to exclude the evidence of Briggs’ second appraisal. [Emphasis in original.] 762 N.E.2d at 716.

The “inherent improbability” referred to the fact that the owner would not have started to dismantle the asphalt plant had it not been for the city’s impending acquisition. Id. When the date of filing rule worked an injustice, the Illinois courts formerly responded by dismissing the complaint to condemn rather than by changing the date of value. Once the case had been dismissed, the condemnor had to refile and thereby receive a later valuation date. Sanitary Dist. of Chicago v. Chapin, 226 Ill. 499, 80 N.E. 1017 (1907). Should the condemnor increase the size of the acquisition, the date of valuing the new or additional property would be the date of filing the amended complaint. Lieberman v. Chicago & S.S.R.T.R. Co., 141 Ill. 140, 30 N.E. 544 (1892); Department of Transportation v. HP/Meachum Land Limited Partnership, 245 Ill.App.3d 252, 614 N.E.2d 485, 185 Ill.Dec. 351 (2d Dist. 1993). Should the condemnor decrease the size of the acquisition, the date of valuing the remaining property would remain the date of filing the original complaint. Department of Transportation of State of Illinois v. LaSalle National Bank, 102 Ill.App.3d 1093, 430 N.E.2d 286, 58 Ill.Dec. 344 (2d Dist. 1981). In LaSalle National Bank, the Second District carefully distinguished the First District’s decision in People v. Northern Trust Co., 59 Ill.App.3d 1053, 376 N.E.2d 286, 17 Ill.Dec. 287 (1st Dist. 1978). The date of filing rule does not preclude evidence of actions occurring after the filing date as long as they relate to valuation on the filing date. For example, in People ex rel. Department of Transportation v. Birger, 155 Ill.App.3d 130, 507 N.E.2d 1321, 107 Ill.Dec. 952 (5th Dist. 1987), evidence was admitted of a sale occurring two months after the valuation date when no substantial change in the area took place during this period. The proponent of the post-valuation date sale has the burden of proving that the public project did not influence the sales price. Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 250 Ill.App.3d 665, 619 N.E.2d 1321, 189 Ill.Dec. 272 (2d Dist. 1993). Similarly, in Oak Brook Park District v. Oak Brook Development Co., 170 Ill.App.3d 221, 524 N.E.2d 213, 223, 120 Ill.Dec. 448 (2d Dist.



1988), the trial court admitted evidence of DuPage County’s “Master Plan,” even though it was adopted nine months after the filing date. Upholding its admissibility, the appellate court noted the plan was based on facts and circumstances that existed on the valuation date. On the other hand, a significant change in the condition of the property after the date of filing the complaint to condemn may foreclose evidence of the property’s condition in its post-complaint state or even a jury view of the property. Illinois State Toll Highway Authority v. Grand Mandarin Restaurant, Inc., 189 Ill.App.3d 355, 544 N.E.2d 1145, 136 Ill.Dec. 370 (2d Dist. 1989) (upholding exclusion of videotape of restaurant taken after filing date and after owners had removed personal property and fixtures). The owners’ ability to encumber the subject property with easements after the date of filing the condemnation case but before the condemnor obtained title by paying the jury verdict led to an interesting discussion of the proper valuation date in Department of Natural Resources of State of Illinois v. Brauer, 339 Ill.App.3d 723, 791 N.E.2d 120, 274 Ill.Dec. 324 (3d Dist. 2003). After the Illinois Department of Natural Resources (DNR) filed its complaint to condemn but before DNR obtained title to the property, the owners sold easements over the property for $35,000. In a two-one decision, the appellate court refused to uphold a $35,000 setoff against the jury’s compensation award on the basis that DNR had not proved the easements had decreased the property’s value. 3. Highest and Best Use a. [7.15] Definition Property must be valued at its highest and best use. This term of art means the use that would give the property its highest cash market value on the date of filing the condemnation complaint or on the date of valuation set by the court. Often, this is the actual and existing use of the property. However, the highest and best use may also be a use other than the existing use, provided the property was adaptable to the prospective use and provided the prospective use “would be anticipated with such reasonable certainty that it would enhance the market value on that date.” I.P.I. — Civil No. 300.84. See Pittsburgh, C., C. & St. L. Ry. v. Gage, 286 Ill. 213, 121 N.E. 582 (1918). In Crystal Lake Park Dist. v. Consumers’ Co., 313 Ill. 395, 145 N.E. 215, 219 (1924), the Supreme Court stated:

The owner of property appropriated for public use is entitled to its market value for the most profitable use for which it is available, and any capacity for future use which may be anticipated with reasonable certainty, though dependent upon circumstances which may possibly never occur, is competent to be considered by the jury if it in fact enhanced the market value of the land in its present condition and state of improvement. The future prospective use affecting value must be a present capacity for a use which may be anticipated with reasonable certainty and made the basis of an intelligent estimate of value.

Proving the adaptability of property for another use may include, as in Crystal Lake Park Dist., proving that the property (swampland on the date of valuation) could be filled and would then be suitable for residential development. Conversely, a party may introduce evidence showing



a particular highest and best use is not feasible due to the need to assemble other properties, obtain permits, and incur prohibitive development costs. Department of Conservation of State of Illinois v. Dorner, 192 Ill.App.3d 333, 548 N.E.2d 749, 139 Ill.Dec. 364 (1st Dist. 1989). Other sources of proof may include introducing development plans for the property that were prepared prior to the condemnation case (Department of Conservation of State of Illinois ex rel. People v. Kyes, 57 Ill.App.3d 563, 373 N.E.2d 304, 15 Ill.Dec. 34 (2d Dist. 1978)) or demonstrating that the location of the property is appropriate for the prospective use and had so been considered prior to the condemnation case (Illinois Light & Power Co. v. Bedard, 343 Ill. 618, 175 N.E. 851 (1931)). The prospective use cannot be so remote, speculative, or conjectural that it would not affect the market value on the date of valuation. The key is still what amount the property would sell for on this date. If additional money would be paid for the possibility of developing the property, the court should admit this evidence. If additional money would probably not be paid for a prospective venture, the court should not admit the evidence of the prospective use. In Peoples Gas Light & Coke Co. v. Buckles, 24 Ill.2d 520, 182 N.E.2d 169 (1962), the owners predicated value on a theory that their property could be combined with several other properties to form a gas storage reservoir. But the Supreme Court ruled that any potential value for such a use was too remote because the use depended on too many speculative factors. Therefore, testimony based on this use could not be admitted in evidence. Even though the prospective use may never occur, there must be a present capacity for a use that may be anticipated with reasonable certainty. City of Chicago v. Lord, 276 Ill. 571, 115 N.E. 397 (1917). The potential development must be reasonably probable, rather than merely desirable, and must be likely to occur within a reasonably proximate time, rather than in the future. Lake County Forest Preserve District v. Bank & Trust Company of Arlington Heights, 106 Ill.App.3d 856, 436 N.E.2d 237, 62 Ill.Dec. 487 (2d Dist. 1982). If the proposed highest and best use involves a different use than the present use of the property, and if the different use would require a zoning change, the appraiser must be able to demonstrate that there was a reasonable probability of obtaining the zoning change. Board of Trustees of University of Illinois v. Shapiro, 343 Ill.App.3d 943, 799 N.E.2d 383, 278 Ill.Dec. 665 (1st Dist. 2003). Each side may adopt its own theory of highest and best use. Cook County v. Holland, 3 Ill.2d 36, 119 N.E.2d 760 (1954). A party’s theory of highest and best use is normally conveyed to the jury through the testimony of its experts. While a party can, no doubt, make pretrial admissions of highest and best use through its actions or statements, the courts have reviewed these carefully. See Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 196 Ill.App.3d 5, 552 N.E.2d 1151, 142 Ill.Dec. 410 (2d Dist. 1990) (Illinois State Toll Highway Authority’s (ISTHA) statement of highest and best use of property in environmental impact statement held not to be admission). A jury normally decides the highest and best use as a question of fact. However, in an unusual case, the appellate court held that the question of highest and best use “may be a question of law for the trial judge when the evidence is so inherently improbable it should be excluded



from the jury.” [Emphasis in original.] City of Quincy, Illinois v. Diamond Construction Co., 327 Ill.App.3d 338, 762 N.E.2d 710, 716, 261 Ill.Dec. 141 (4th Dist. 2002). Different parts of a property can also have different highest and best uses. For example, on a large tract, one part may have a highest and best use of commercial development, and the other part may be better suited to residential development. Department of Public Works & Buildings of State of Illinois ex rel. People v. First National Bank of Joliet, 9 Ill.App.3d 633, 292 N.E.2d 487 (3d Dist. 1973). Physical conditions, such as the existence of wetlands on a portion of the property, may result in different highest and best uses for different portions of the property. Department of Transportation v. HP/Meachum Land Limited Partnership, 245 Ill.App.3d 252, 614 N.E.2d 485, 185 Ill.Dec. 351 (2d Dist. 1993). The different portions of the property should be “recognizably distinct from each other” to warrant assigning different highest and best uses. Department of Transportation, State of Illinois v. Kelley, 352 Ill.App.3d 278, 815 N.E.2d 1214, 1217, 287 Ill.Dec. 411 (3d Dist. 2004). b. [7.16] Reasonable Probability of Rezoning Sometimes property may be adaptable for a more profitable use, but it may not be put to that use on the valuation date because it does not conform to governmental regulations, such as zoning, permit requirements, etc. In these situations, the courts nevertheless permit the jury to consider the more profitable use as long as there exists a reasonable probability of obtaining legislative or administrative relief in the near future. As stated in Lake County Forest Preserve District v. Petersen, 93 Ill.App.3d 731, 417 N.E.2d 862, 864 – 865, 49 Ill.Dec. 172 (2d Dist. 1981): “The rationale underlying the concept of reasonable probability is that a jury should have available to it all the facts which private parties would consider in negotiating a sale on the open market.” If a prospective purchaser would likely give weight to the reasonable probability of lifting certain government restrictions, then the jury should also be able to consider what effect this would have on market value. In Petersen, the owner submitted evidence of market value based on the reasonable probability of obtaining an Environmental Protection Agency permit for a sanitary landfill. As far back as 1912, the Supreme Court permitted valuation based on a highest and best use of property for warehouse purposes that was dependent on the reasonable probability of obtaining permission from the city council to bring railroad switch tracks across a street to service the property. Chicago & W.I.R. Co. v. Heidenreich, 254 Ill. 231, 98 N.E. 567 (1912). See also Board of Trustees of University of Illinois v. Shapiro, 343 Ill.App.3d 943, 799 N.E.2d 383, 278 Ill.Dec. 665 (1st Dist. 2003). However, most of the developments in this area have been of more recent vintage, and most reflect contests over the reasonable probability of rezoning or annexing and rezoning property. In 1968, the Supreme Court faced, for the first time, the issue of whether evidence of probability of rezoning is admissible to determine the value of property in a condemnation proceeding. Citing with approval the appellate court’s decision in Park District of Highland Park, Illinois v. Becker, 60 Ill.App.2d 463, 208 N.E.2d 621 (2d Dist. 1965), the Supreme Court held a party could adopt a theory of valuation based on a highest and best use that could be contemplated but that would not be permitted under existing zoning restrictions. Department of Public Works & Buildings v. Rogers, 39 Ill.2d 109, 233 N.E.2d 409 (1968). In Department of Transportation v. Western



National Bank of Cicero, 63 Ill.2d 179, 347 N.E.2d 161, 165 (1976), the Supreme Court followed this decision by permitting valuation based on a use allowed only under a different zoning classification “where there is reasonable probability of the granting of such zoning in the near future.” As a result of the law’s development in this area, the Supreme Court later held that I.P.I. — Civil No. 300.85 (2d ed. 1971) did not accurately state the law. Department of Public Works & Buildings v. Association of Franciscan Fathers of State of Illinois, 69 Ill.2d 308, 371 N.E.2d 616, 13 Ill.Dec. 681 (1977). The Illinois Supreme Court Committee on Jury Instructions in Civil Cases proposed, and in November 1990 the Supreme Court promulgated, a revised instruction (I.P.I. — Civil No. 300.85):

300.85 Reasonable Probability of Rezoning If you find that on [insert date complaint was filed] there was a reasonable probability of rezoning the property, then you may consider the effect of such rezoning in determining just compensation in this case.

The concept of reasonable probability has been extended to embrace valuation based on annexation and rezoning. Lake County Forest Preserve District v. Reliance Standard Life Insurance Co., 29 Ill.App.3d 145, 329 N.E.2d 344 (2d Dist. 1975). Introducing annexation into a highest and best use theory, though, adds another layer of problems to overcome to demonstrate the reasonable probability of obtaining government permission for the proposed use and, thus, adds to the danger of speculation. Lake County Forest Preserve District v. Bank & Trust Company of Arlington Heights, 106 Ill.App.3d 856, 436 N.E.2d 237, 62 Ill.Dec. 487 (2d Dist. 1982). The Second District rejected an objection of speculation and upheld admission of the property owners’ reasonable probability of obtaining alternate means of access to the subject property. Forest Preserve District of DuPage County v. Brookwood Land Venture, 199 Ill.App.3d 973, 557 N.E.2d 980, 146 Ill.Dec. 38 (2d Dist. 1990). An attorney who attempts to present a case based on a reasonable probability theory must understand what type of evidence may be introduced to establish the theory and what type of evidence may not be introduced. If the proper foundation is not laid, the expert may not opine on the reasonable probability of obtaining a variation, etc. Department of Transportation v. First Bank of Schaumburg, 260 Ill.App.3d 490, 631 N.E.2d 1145, 197 Ill.Dec. 686 (1st Dist. 1992). The trial court will not permit a government official’s or attorney’s opinion testimony as to the reasonable probability of rezoning or as to what the exact rezoning classification would be. Department of Conservation v. Aspegren Financial Corp., 72 Ill.2d 302, 381 N.E.2d 231, 21 Ill.Dec. 153 (1978). Thus, an attorney cannot present the village president or the head of a plan commission to testify a zoning change would be granted. Lombard Park District v. Chicago Title & Trust Co., 103 Ill.App.2d 1, 242 N.E.2d 440 (2d Dist. 1968); Morton Grove Park District v. American National Bank & Trust Company of Chicago, 39 Ill.App.3d 426, 350 N.E.2d 149 (1st Dist. 1976). Nor can a party introduce evidence of the intent of officials when they enacted ordinances or adopted comprehensive plans, although the party can introduce the ordinances and comprehensive plans themselves. Oak Brook Park District v. Oak Brook Development Co., 170 Ill.App.3d 221, 524 N.E.2d 213, 120 Ill.Dec. 448 (2d Dist. 1988). A party can introduce evidence of minutes of public hearings when necessary to resolve an ambiguity in a zoning ordinance or an



apparent conflict between a comprehensive plan and a zoning ordinance. Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 250 Ill.App.3d 665, 619 N.E.2d 1321, 189 Ill.Dec. 272 (2d Dist. 1993). Among the items that may be offered to support such a theory, according to the opinions in Rogers, supra, Franciscan Fathers, supra, Lombard Park District, supra, and Oak Brook Park District, supra, are 1. the physical characteristics of the subject property; 2. available utilities to serve the proposed use; 3. the location of the subject property; 4. the change of actual uses in the area; 5. growth patterns in the area; 6. the demand for certain uses in the area; 7. sales of similar properties at prices reflecting anticipated rezonings; 8. the age of the zoning ordinance; 9. the provisional nature of the subject property’s zoning classification; 10. rezonings of nearby properties to show the flexibility of the zoning ordinance; 11. comprehensive and master plans; and 12. ordinances or deed restrictions affecting the property. Relying on any one of these items, such as the mere submission of other zoning changes to prove flexibility of the ordinance, may not be sufficient if other items, such as geographic and economic factors, militate against the proposed use. Bank & Trust Company of Arlington Heights, supra. Of course, the party opposing the theory may offer evidence to show the possibility of rezoning cannot be anticipated with reasonable certainty within the reasonably near future and is too speculative. If a contest develops, the burden of proving the reasonable probability falls on the proponent of the theory. The accepted procedure is for the trial judge to adopt a two-stage procedure. Franciscan Fathers, supra. In the first stage, which is held outside the presence of the jury, the trial judge considers the evidence and decides whether there is sufficient evidence to make a determination that a reasonable probability exists. If there is, then the second stage commences, the jury is brought back, and the party presents evidence of reasonable probability and then presents evidence of market value based on the reasonable probability.



Since the jurors are the ultimate triers of fact, they make the final determination of whether there is a reasonable probability of rezoning and whether this would affect market value. The judge’s determination in the first stage merely permits the evidence to be presented to the jury; it does not bind the jury. According to the opinion in Petersen, supra:

The underlying reason for this preliminary procedure is that the right to have compensation determined by a jury contemplates that the jury will be presented only competent evidence. If the court correctly determines that the evidence is not competent, there is no right to have such evidence heard by the jury. . . . As a general rule, the probability of rezoning or other governmental relief is admissible if the prospect is sufficiently likely so as to have an appreciable influence upon present market value. . . . In seeking just compensation the property owner is entitled to consideration by the jury of evidence which is material, relevant and competent to support his theory of the case. . . . In the final analysis the question of the trial court’s role in initially determining whether a sufficient foundation has been laid for the evidence to be considered by the jury is thus whether it is material, relevant, and competent for that purpose. [Citations omitted.] 417 N.E.2d at 865.

Petersen, a split decision, also demonstrates the problems of proof that arise in these considerations. Whether a party can prove that a reasonable probability of rezoning exists, the condemnor cannot adopt or rely on an ordinance that denies the rezoning of a property to a more intense use or downzones a property to a less intense use on the basis that the property may be acquired by a public body someday. Department of Public Works & Buildings of State of Illinois v. Exchange National Bank, 31 Ill.App.3d 88, 334 N.E.2d 810 (2d Dist. 1975). 4. [7.17] Unit Rule As a corollary of the rule requiring a witness to value property as a whole and not as the sum of its parts, and as a means of preventing the introduction of collateral issues at trial, the Illinois courts have adopted the unit rule, which prohibits a witness from breaking down his or her testimony. The unit rule has become one of the more unique, controversial, and misunderstood elements in eminent domain practice. In an opinion discussing the unit rule, two of the three appellate judges wrote a concurring opinion that urged the Supreme Court to “revisit” the unit rule and asserted the unit rule “ignores realities of land valuation and should give way.” Department of Transportation, State of Illinois v. Kelley, 352 Ill.App.3d 278, 815 N.E.2d 1214, 1219, 287 Ill.Dec. 411 (3d Dist. 2004) (Holdridge, P.J., and Schmidt, J., specially concurring). Unfortunately, the Supreme Court did not accept their invitation. The appellate court held the unit rule bars an appraiser from valuing a large parcel by “dividing indistinct portions of the whole” and assigning a separate value to each portion. 815 N.E.2d at 1215. The rule does not bar appraisers from valuing some portions of the whole property differently than other portions, provided the different parts “are recognizably distinct from each other.” 815 N.E.2d at 1217. The appellate court attempted to explain the unit



rule in Department of Transportation v. East Side Development, L.L.C., 384 Ill.App.3d 295, 892 N.E.2d 136, 322 Ill.Dec. 889 (3d Dist. 2008). In an effort to clear some of the cloud surrounding the unit rule controversy, it may be helpful to examine the origin and development of the rule. Article I, §15, of the Illinois Constitution and the Fifth Amendment to the United States Constitution require the payment of just compensation to an owner for a taking. The measure of just compensation is most often the “fair [cash] market value of” the property. Housing Authority of City of East St. Louis v. Kosydor, 17 Ill.2d 602, 162 N.E.2d 357, 359 (1959). Section 10-5-60 of the Eminent Domain Act defines “fair cash market value” as the “amount of money that a purchaser, willing, but not obligated, to buy the property, would pay to an owner willing, but not obliged, to sell in a voluntary sale.” 735 ILCS 30/10-5-60. Thus, the focus of an eminent domain case is the market value of the property itself, not what the owner has lost or what the condemnor has gained. From these principles comes the unit rule — a rule of valuation that is often misunderstood. There are two elements of the unit rule: a. The property should be valued as if sold as a single entity and not as if sold as individual parts. b. The property should be valued as if title were held by a single person even if there are multiple interests. The unit rule prohibits an appraiser from aggregating the values of separate parts of the property to reach a value of the whole property. The appraiser can consider the value of the property’s constituent parts only insofar as they affect the value of the whole property. This application of the unit rule is reflected in Standards Rule 1-4(e) of the UNIFORM STANDARDS OF PROFESSIONAL APPRAISAL PRACTICE (Appraisal Foundation, 2016 – 2017), www.uspap.org, which states:

When analyzing the assemblage of the various estates or component parts of a property, an appraiser must analyze the effect on value, if any, of the assemblage. An appraiser must refrain from valuing the whole solely by adding together the individual values of the various estates or component parts.

Most often, questions about this part of the unit rule arise when the property has valuable mineral or agricultural interests. The first case discussing this application is Peoria, B. & C. Traction Co. v. Vance, 234 Ill. 36, 84 N.E. 607 (1908). The Supreme Court expanded on the application of the unit rule 13 years later, in 1921, when it decided Forest Preserve Dist. of Cook County v. Caraher, 299 Ill. 11, 132 N.E. 211, 213 (1921), and stated:

The rule is that compensation must be estimated for the land as land, with all its capabilities, and if there is timber on it, or coal, oil, or other minerals under the surface, they are to be considered so far as they affect the value of the land, but they cannot be valued separately.

http://www.uspap.org/



This is the classic statement of the unit rule in this context and was later reiterated by the Supreme Court in such cases as Department of Public Works & Buildings v. Oberlaender, 42 Ill.2d 410, 247 N.E.2d 888 (1969) (property with valuable sand deposits), and Department of Transportation v. Toledo, Peoria & Western R.R., 75 Ill.2d 436, 389 N.E.2d 546, 27 Ill.Dec. 482 (1979) (property with fill material). Note, however, the interesting refusal to apply the unit rule when the condemnor acquires not the fee simple title to the property but only title to the mineral deposits themselves. Department of Transportation ex rel. People v. Farnsworth, 273 Ill.App.3d 631, 653 N.E.2d 423, 210 Ill.Dec. 518 (3d Dist. 1995). The other classic application of the unit rule is that the property is to be valued as a whole even if its ownership is divided into various interests. The most common situation in which this occurs is when the property is subject to a lease. Here, the court should follow a two-step process. First, the trier of fact needs to determine the market value of the property irrespective of the ownership rights in it. Then, if the holders of the various ownership interests cannot agree on how to split up the award of just compensation, the trier of fact needs to determine who is entitled to what. Department of Transportation v. White, 264 Ill.App.3d 145, 636 N.E.2d 1204, 201 Ill.Dec. 772 (5th Dist. 1994). There is one exception to this rule. When the property is subject to a public easement (e.g., when a portion of the property has been previously dedicated for a public right-of-way), then an appraiser can take that fact into account and attribute a value to that part of the fee subject to the dedication. City of Springfield, Illinois v. West Koke Mill Development Corp., 312 Ill.App.3d 900, 728 N.E.2d 781, 245 Ill.Dec. 699 (4th Dist. 2000). a. [7.18] Partial Takings The Illinois courts have extended the concept of the unit rule to the valuation of the part taken in a partial taking situation. On the surface, the rule seems straightforward. I.P.I. — Civil No. 300.44 provides: “In arriving at the fair cash market value of the property taken, you should determine its value considered as a part of the whole tract before the taking and not its value as a piece of property separate and disconnected from the rest of the tract.” Frequently cited cases discussing this approach include Department of Public Works & Buildings v. Lotta, 27 Ill.2d 455, 189 N.E.2d 238 (1963), and Department of Transportation ex rel. People v. Central Stone Co., 200 Ill.App.3d 841, 558 N.E.2d 742, 146 Ill.Dec. 779 (4th Dist. 1990). A 2014 decision involving the application of the unit rule in partial taking situations is Department of Transportation ex rel. People v. Raphael, 2014 IL App (2d) 130029, 9 N.E.3d 1120, 381 Ill.Dec. 1. However, as a practical matter, the valuation of a part taken, especially a part taken that includes improvements such as landscaping, signs, and pavement, is not so easy for an appraiser. The reason is there are no sales of such property to use as a basis for a market approach to valuation. Who would buy a 17-foot-wide strip of land at the edge of a gasoline service station? It may be easy to find sales of comparable service stations but impossible to find sales of 17-foot-wide strips at the edge of a service station. Most appraisers attempt to estimate a value for such a partial taking by looking at vacant land values (to get an idea of the value of land in the area) and the depreciated value of the improvements in the part taken (to get an idea of the value of the improvements in the area). At most, they come up with a hypothetical value for a piece of property that really has no market value.



This reality, the lack of any market value for most strip takings, seems to have been overlooked by the appellate court in Department of Transportation v. First Bank of Schaumburg, 260 Ill.App.3d 490, 631 N.E.2d 1145, 197 Ill.Dec. 686 (1st Dist. 1992). The court frowned on an approach to valuing the part taken that included valuing the land based on sales of comparable vacant land and adding to it the “contributory value of those improvements” within the part taken. 631 N.E.2d at 1149. Citing the unit rule, the court concluded that the value of improved property must be undertaken without assignment of separate costs and values. How an appraiser is to do this in a partial taking is not explained. At issue in Raphael, supra, was whether the appraiser had properly considered the contributory value of the improvement located on the remainder property when valuing the part taken. The appellate court described the unit rule in partial takings as follows:

The unit rule provides that, in partial takings, the part taken must be valued as part of the whole, considering its best use. . . . However, not every part of a tract will be as valuable as other parts. . . . Thus, the unit rule does not require the whole property to be valued on a single proportionate per-square-foot basis, ignoring the difference between the values of the part taken and the remainder. [Citations omitted.] 2014 IL App (2d) 130029 at ¶18.

While the appellate court’s summary of the unit rule appears to be straightforward, the application of the unit rule to actual takings remains difficult. The Raphael court held both the owner’s appraiser and the Illinois Department of Transportation’s appraiser had violated the unit rule: the owner’s appraiser for assigning a uniform square-foot value over the whole property, and IDOT’s appraiser for failing to consider the contributory value of improvements on the remainder when valuing the part taken. b. [7.19] Unit Rule and Expert Cross-Examination Several court decisions attempted to invoke the unit rule in support of limitations on the scope of cross-examination of appraisal witnesses. For example, in Metropolitan Sanitary District of Greater Chicago v. Industrial Land Development Corp., 121 Ill.App.2d 393, 257 N.E.2d 532 (1st Dist. 1970), the appellate court affirmed the trial court’s ruling that barred the cross-examination of an appraiser as to how he had appraised the property using the income approach. Acknowledging that the Supreme Court had approved use of the three classic valuation techniques (the comparable-sales approach, the income approach, and the cost approach) under appropriate circumstances, the appellate court nevertheless stated that “the separate values or results under such methods are not admissible and cannot be made the sole basis of valuation.” 257 N.E.2d at 535. See also Department of Transportation of State of Illinois ex rel. People v. Schlechte, 94 Ill.App.3d 187, 418 N.E.2d 1000, 50 Ill.Dec. 6 (5th Dist. 1981). This limitation seems grounded in the concern of courts that introducing the underlying computations of the appraiser could confuse the jury and possibly lead the jury to conclude the value of the property was merely the sum of the different component elements in the appraiser’s analysis. See Department of Public Works & Buildings v. Lotta, 27 Ill.2d 455, 189 N.E.2d 238 (1963). However, this restriction on cross-examination is inconsistent with the modern approach to expert testimony, which permits extensive cross-examination, and pronouncements in other



Supreme Court cases. Ill.R.Evid. 705 expressly permits cross-examination of an expert on the underlying facts or data. Previously, in City of Chicago v. Anthony, 136 Ill.2d 169, 554 N.E.2d 1381, 144 Ill.Dec. 93 (1990), the Illinois Supreme Court reaffirmed its earlier adoption of Fed.R.Evid. 703 and 705, which clearly contemplate a full exposition of the basis of an expert’s testimony, whether through direct or cross-examination. Often, the objectionable nature of expert testimony may not become apparent until it is subject to cross-examination. See Central Illinois Public Service Co. v. Gibbel, 65 Ill.App.3d 890, 382 N.E.2d 846, 22 Ill.Dec. 456 (4th Dist. 1978). See also Department of Transportation ex rel. People v. Central Stone Co., 200 Ill.App.3d 841, 558 N.E.2d 742, 750, 146 Ill.Dec. 779 (4th Dist. 1990) (Green, J., specially concurring) (pointing out that basis for objection to expert testimony became clear only from cross-examination). The drafters of the Illinois and Federal Rules of Evidence had faith in the intelligence of jurors and their ability to understand expert testimony. The unit rule, originally a rule of valuation, does not easily translate into a rule of cross-examination. The Illinois Supreme Court in Anthony, supra, cited the unit rule with approval in support of its decision to uphold a trial court’s exclusion of testimony concerning the future rental income that could be derived from leasing a small portion of the subject property to a billboard company. The Supreme Court stated:

The motion judge found the property must be valued as a whole, and a lease may not be separately valued as one part to be added to another part. This ruling is consistent with the unit rule of valuation in eminent domain cases, which requires that property be valued as a whole. Because the “measure of recovery for damage to private property caused by a public improvement is the loss which concerns the property itself . . . the fair market value of improved property is not the sum of the value of the building and the value of the land computed separately.” [Lotta, supra, 189 N.E.2d at 240.] The unit rule is applied in eminent domain cases to avoid misleading the jury. 554 N.E.2d at 1384.

In decisions following Anthony, the appellate courts have reasserted the unit rule. Department of Transportation v. First Bank of Schaumburg, 260 Ill.App.3d 490, 631 N.E.2d 1145, 197 Ill.Dec. 686 (1st Dist. 1992) (held error for appraiser to value part taken by merely adding value of land and contributing value of improvements on part taken); Department of Transportation v. White, 264 Ill.App.3d 145, 636 N.E.2d 1204, 201 Ill.Dec. 772 (5th Dist. 1994). In a third decision following Anthony, the appellate court cited the unit rule but held that the appraiser had valued the property as a whole. County of St. Clair v. Wilson, 284 Ill.App.3d 79, 672 N.E.2d 27, 219 Ill.Dec. 712 (5th Dist. 1996). A more recent decision, in which the appellate court held that valuing different portions of a property differently would not necessarily violate the unit rule, is Department of Transportation, State of Illinois v. Kelley, 352 Ill.App.3d 278, 815 N.E.2d 1214, 287 Ill.Dec. 411 (3d Dist. 2004). Despite the appellate courts’ reaffirmation of the unit rule, several questions remain unanswered arising out of the tension between the unit rule, which may preclude examination of an expert on certain subjects to avoid jury confusion, and the Illinois and Federal Rules of Evidence, which seek to widen the scope of expert examination.



The decisions in both Anthony, supra, and Department of Transportation v. Beeson, 137 Ill.App.3d 908, 485 N.E.2d 511, 92 Ill.Dec. 700 (2d Dist. 1985), applied Fed.R.Evid. 703 and 705 to valuation testimony. One of the policies underlying the federal rules governing expert witness testimony is “to broaden the basis for expert opinions beyond that current in many jurisdictions and to bring the judicial practice into line with the practice of the experts themselves when not in court.” Advisory Committee Notes, 1972 Proposed Rules, Fed.R.Evid. 703. The drafters of the Federal Rules of Evidence decided the counterweight to loosening the artificial constraints on expert testimony was expanding the scope of cross-examination of the expert. Fed.R.Evid. 705 specifically provides: “[T]he expert may be required to disclose those facts or data on cross-examination.” If the expert actually made calculations in arriving at an opinion of value, then the policy stated in Fed.R.Evid. 703 and in the accompanying Advisory Committee Notes would appear to justify revelation of the calculations. For example, cross-examination on the underlying figures in an income approach was prohibited in Metropolitan Sanitary District, supra, 257 N.E.2d at 535 – 536. This decision also demonstrates the difficulty, and some would say the contradiction, in applying the unit rule. Although the appellate court upheld the trial court’s decision to sustain an objection, based on the unit rule, to the question, “How did you appraise the property with regard to the income method of appraising?,” in another part of the same opinion the appellate court approved cross-examination as to the lease on the subject property by citing the Supreme Court’s decision in Spohr v. City of Chicago, 206 Ill. 441, 69 N.E. 515, 516 – 517 (1903), which stated, “the cross-examiner is entitled in every instance to demand a free disclosure, minutely and in detail. . . . [S]o far as the cross-examination . . . relates either to facts in issue or facts relevant to the issue, it may be pursued as a matter of right.” 257 N.E.2d at 535 – 536. Since the adoption of Fed.R.Evid. 703 and 705 by judicial fiat in Wilson v. Clark, 84 Ill.2d 186, 417 N.E.2d 1322, 49 Ill.Dec. 308 (1981), the Supreme Court has emphasized the importance of wide-ranging cross-examination. Trower v. Jones, 121 Ill.2d 211, 520 N.E.2d 297, 299, 117 Ill.Dec. 136 (1988) (“Cross-examination has been made more difficult in part by the increased latitude given experts when rendering their opinions. . . . Although we view this expansion as prudent, we do recognize the added burden which these changes place upon a party during cross-examination in attempting to discredit his opponent’s expert, and we also recognize that these changes heighten the importance of such cross-examination.”). In People v. Pasch, 152 Ill.2d 133, 604 N.E.2d 294, 178 Ill.Dec. 38 (1992), the Supreme Court approved cross-examination on the contents of reports and conclusions of other experts regardless of whether the expert relied on them, cross-examination with respect to material reviewed by the expert but on which he or she did not rely, and cross-examination to ascertain what factors the expert took into account and what factors the expert disregarded in arriving at an opinion. No doubt future courts will be called on to square these principles with the restrictive cross-examination espoused in some unit rule cases. See First Bank of Schaumburg, supra, 631 N.E.2d at 1149 (“Accordingly, it is improper to cross-examine a witness regarding the separate values of land and improvements, and the admission of specific figures for these components constitutes palpable and reversible error.”). Ill.R.Evid. 705, similar to Fed.R.Evid. 705, states, in relevant part: “The expert may in any event be required to disclose the underlying facts or data on cross-examination.” The Illinois Supreme Court’s adoption of Ill.R.Evid. 705 would appear to encourage, rather than limit, full



and complete cross-examination of a witness. Although not a unit rule case, the appellate court’s opinion in a 2015 case, City of Chicago v. Eychaner, 2015 IL App (1st) 131833, 26 N.E.3d 501, 389 Ill.Dec. 411, emphasizes the need for full cross-examination directed to all the facts and data supporting an appraiser’s opinion. B. Other Aspects of Just Compensation 1. [7.20] Interest as Just Compensation The constitutional right to be paid just compensation includes not only compensation based on the fair market value of the property but also payment of interest at a fair rate for any delay between the condemnor’s taking of the property and the condemnor’s payment of full and final compensation for the taking. Illinois State Toll Highway Authority v. American National Bank & Trust Company of Chicago, 162 Ill.2d 181, 642 N.E.2d 1249, 205 Ill.Dec. 132 (1994). In Illinois eminent domain proceedings, this delay between the taking and full payment can occur when the condemnor uses the quick-take power. For example, in American National Bank, the Illinois State Toll Highway Authority obtained title and possession of property in 1987 and 1988 by depositing with the county treasurer the total preliminary just compensation award of $176,300. However, the trial to determine the final just compensation did not take place until later, and then the jury determined that the market value for the property being taken was $603,571. Thus, the difference between the preliminary and final just compensation for the taking was $427,271. Section 20-5-30 of the Eminent Domain Act (former 735 ILCS 5/7-105 and former Ill.Rev.Stat. (1991), c. 110, ¶7-108) directs the condemnor to pay a six-percent statutory rate of interest on the difference between the preliminary and final compensation. 735 ILCS 30/20-5-30. However, what if the prevailing market rates of interest exceed six percent during this period? If there is a substantial difference between the statutory interest rate of six percent and the prevailing market rate, the owner would not be fully compensated for the $427,271 shortfall during the period between the condemnor’s taking and the condemnor’s full payment. In American National Bank, the Supreme Court held that both the Fifth Amendment of the U.S. Constitution and Article I, §15, of the Illinois Constitution mandate the payment of interest when the state takes property before making full payment. Further, the Supreme Court ruled that the six-percent statutory interest rate acted only as a floor, not a ceiling. To determine the appropriate rate of interest to apply to the difference between the preliminary and final compensation, the Supreme Court rejected any reliance on the rate of return on real estate investments; instead, it referred to yields from high-grade corporate bonds and yields from government securities, such as Treasury bonds. Finally, American National Bank held that the parties have a right to a jury determination of the amount of interest to be paid on the difference between the preliminary and final just compensation. This pronouncement settled the apparent discrepancy between the appellate court’s opinion in Department of Transportation of State of Illinois ex rel. People v. Rasmussen, 108 Ill.App.3d 615, 439 N.E.2d 48, 64 Ill.Dec. 119 (2d Dist. 1982), which appeared to require a jury determination of the issue, and the appellate court’s opinion in Department of Transportation of State of Illinois ex rel. People v. Gass, 165 Ill.App.3d 562, 519 N.E.2d 90, 116 Ill.Dec. 500 (5th Dist. 1988), which ruled the trial court, rather than the jury, must determine the proper rate of



interest as a supplemental question of law. The Supreme Court’s American National Bank opinion establishes the right to a jury trial, thereby overruling the apparent opinion in Gass and portions of the appellate court’s opinion in Department of Transportation of State of Illinois v. Carriage Hills Kennels, 255 Ill.App.3d 43, 627 N.E.2d 303, 194 Ill.Dec. 187 (1st Dist. 1993). American National Bank also states that if the parties do not request a jury trial on the interest issue, they have waived their right, and the trial court can determine the proper rate of interest. However, the Supreme Court does not give satisfactory guidance on the procedures to be followed in obtaining a jury determination of the appropriate rate of interest. The Supreme Court’s opinion states:

In the matter before us, the Highway Authority did make an appropriate jury demand, and a jury trial was held to obtain a final determination of the amount of just compensation owed to the landowners. Based on the authorities we have just discussed, it is clear that the amount of interest due on the difference between the amount of just compensation finally adjudicated and the amount preliminarily found by the court to be just compensation could therefore have been submitted to the jury at that trial as part of its final determination as to just compensation. 642 N.E.2d at 1254.

This is easier said than done because determination of the proper rate of interest may vary with the size of the sum involved, i.e., large sums typically earn higher rates than small sums. Therefore, to make this determination, the jury must know the size of the difference between the final just compensation set by it and the preliminary just compensation set by the trial court. Such knowledge of the preliminary just compensation, though, runs squarely against the statutory prohibition against advising the jury of the amount of preliminary just compensation. 735 ILCS 30/20-5-10(d). The only ways to avoid this problem are to have a bifurcated trial or a separate trial. Rasmussen, supra, which is favorably cited by the Supreme Court in American National Bank, held the constitutional right to be paid a market rate of interest applies only to the payment for the part taken, not for damages to the remainder. By contrast, the statute directing payment of six-percent interest on the difference between the preliminary and final just compensation does not distinguish payment for the part taken from damages. That part of the Supreme Court’s opinion in American National Bank relating to interest does not address the question of whether the Rasmussen court drew a proper constitutional distinction between just compensation for the part taken and damages to the remainder. The Second District refused to apply the Rasmussen reasoning to a non-quick-take situation. Waukegan Port District v. Kyritsis, 128 Ill.App.3d 751, 471 N.E.2d 217, 83 Ill.Dec. 918 (2d Dist. 1984). As the size of condemnation awards and, hence, the size of interest earned on those awards have increased, the courts have been confronted with questions concerning the right to interest earned by the county treasurer on the award after the condemnor has deposited it. After receiving the deposit in accordance with 735 ILCS 30/10-5-85, the county treasurer may place the funds in



an interest-bearing account. Note, however, that the treasurers of some counties may not do so unless specifically directed by court order. Who is entitled to the interest earned between the date of deposit and the date of withdrawal: the county treasurer or the property owner? Traditionally, the county treasurer kept the interest. In Locasio v. Rosewell, 50 Ill.App.3d 704, 365 N.E.2d 949, 8 Ill.Dec. 563 (1st Dist. 1977), the appellate court upheld the county treasurer’s right to the interest on the grounds that (a) the predecessor to §10-5-85 (entitled “Interest Payments”) did not provide for payment of interest after deposit to the property owner and (b) the relationship between the property owner and the county treasurer was akin to a debtor-creditor relationship rather than a fiduciary relationship, and as a result the county treasurer owed the property owner only the duty to preserve the deposit. Three years after Locasio, the Illinois Supreme Court rejected the appellate court’s rationale, although it did not explicitly overrule the case, in Morton Grove Park District v. American National Bank & Trust Co., 78 Ill.2d 353, 399 N.E.2d 1295, 1299, 35 Ill.Dec. 767 (1980). The park district condemned the defendant’s property. After a jury verdict established final just compensation, the park district deposited with the county treasurer the sum of the jury’s award and statutory interest on that award from the date of judgment to the date of deposit. The park district then took possession of the property. The owner appealed the amount of the verdict, but during the course of the appeal the owner could not withdraw the deposited funds, for to do so would render the appeal moot under the holding in County of Cook v. Malysa, 39 Ill.2d 376, 235 N.E.2d 598 (1968). Upon completion of the appellate proceedings, the owner filed a petition to withdraw that sought not only the funds the condemnor had deposited but also the interest earned on those funds. In its opinion, the Supreme Court noted that since the condemnor’s deposit with the county treasurer acts as a substitute for the condemned property, the deposit constitutes the owner’s property, and the interest earned on these funds is “a mere incident of ownership of the fund itself.” Morton Grove Park District, supra, 399 N.E.2d at 1299. To allow the county treasurer to keep this interest would constitute a taking of private property for public use without just compensation. As a result, the owner was entitled to the full amount of interest that had been earned on the deposited funds. Undoubtedly, the inequity involved in having the condemnee lose the use of both the property and the condemnation award during the pendency of the appeal concerned the Supreme Court. Since the Supreme Court had not mentioned Locasio, supra, in its opinion, the question remained as to whether Morton Grove Park District applied to situations other than appeals and, by extension, whether Locasio retained any life. In O-Kay Shoes, Inc. v. Rosewell, 129 Ill.App.3d 405, 472 N.E.2d 883, 84 Ill.Dec. 746 (1st Dist. 1984), the appellate court examined this issue and read the Morton Grove Park District, supra, reasoning as being applicable to all interest earned on condemnation funds, regardless of whether an appeal was involved. Holding that the county treasurer must pay all interest earned on a condemnation award from the time of deposit to the time of withdrawal, the appellate court concluded the Morton Grove Park District opinion had, by implication, overturned Locasio, supra.



This line of reasoning finds support in non-condemnation situations. For example, in Canel v. Topinka, 212 Ill.2d 311, 818 N.E.2d 311, 288 Ill.Dec. 623 (2004), the Supreme Court ruled that dividends earned on stock held by the State Treasurer under the Uniform Disposition of Unclaimed Property Act, 765 ILCS 1025/0.05, et seq., belong to the stock owner rather than the state. 2. [7.21] Attorneys’ Fees and Litigation Costs Section 10-5-110 of the Eminent Domain Act opens up the possibility for owners or tenants to recover their attorneys’ fees and certain litigation expenses in the condemnation proceeding. 735 ILCS 30/10-5-110. Prior Illinois law, following the American rule, required each side to pay its own attorneys’ fees and expenses in condemnation litigation, regardless of the outcome. This is true in most other states. A very limited number of states, including Florida, have fee- and cost-shifting provisions that can require the condemning authority to bear the owner’s and tenant’s attorneys’ fees and expenses. Section 10-5-110 takes a middle road and is based on the fee- and cost-shifting provisions found in Federal Rule of Civil Procedure 68, entitled “Offer of Judgment.” This section of the EDA applies to takings only when the acquired property will be owned or controlled by a private entity, i.e., those takings classified in 735 ILCS 30/5-5-5(c) through 30/5-5-5(f). This section does not apply to takings in which the acquired property will be owned and controlled by a public entity, i.e., those takings classified in §5-5-5(b). If §10-5-110 is applicable to a condemnation proceeding, it operates in the following fashion: a. After the conclusion of discovery but at least 14 days before trial, the owner may submit a written offer of settlement to the condemning authority to settle the case for a specific amount. 735 ILCS 30/10-5-110(b). b. If the condemning authority accepts the offer, the case is settled. c. If the condemning authority rejects the offer, the case goes to trial. d. If the trier of fact at the trial (the jury or the judge) determines that the just compensation (fair market value of taken property plus damages to the remainder in a partial acquisition) is equal to, or in excess of, the offer of settlement, then the owner is entitled to recover attorneys’ fees and certain litigation costs. e. The attorneys’ fees awarded to the owner are calculated in a contingent-fee fashion by applying a sliding percentage to the difference between the condemning authority’s last offer before filing the condemnation case and the just compensation award at trial. For example, if the condemning authority had offered $100,000 before filing the condemnation case and the jury verdict for the taking was $160,000, the difference would be $60,000. The section requires the condemning authority to pay one third of that difference, in this case $20,000, to the owner for attorneys’ fees. 735 ILCS 30/10-5-110(f).



f. If the just compensation award exceeds the offer of settlement, the condemning authority must also pay to the owner the reasonable costs and litigation expenses, such as appraisal fees, incurred by the owner after making the offer of settlement. Again, this section is triggered only when the just compensation award at trial exceeds the owner’s rejected offer of settlement. If the just compensation award at trial is less than the offer of settlement, the owner is responsible for all of his or her attorneys’ fees and litigation costs, as usual under the American rule. 3. [7.22] Relocation Assistance The payment of fair cash market value meets the constitutional standard of just compensation. United States v. General Motors Corp., 323 U.S. 373, 89 L.Ed 311, 65 S.Ct. 357 (1945); City of Chicago v. Cunnea, 329 Ill. 288, 160 N.E. 559 (1928). But governmental bodies may voluntarily provide for payments to owners in excess of the constitutional standard if they conclude as a matter of public policy that the fairness of making such additional payments to an owner outweighs the additional costs placed on the condemning authority. Congress reached such a conclusion when it enacted the federal Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970. This statute mandates the payment to displaced persons — whether owners or tenants — of certain expenses, such as relocation costs, rent differentials, replacement housing differentials, etc., that the person may incur with moving from a property that has been acquired. The condemning authority pays these expenses through administrative proceedings separate and apart from the compensation paid in the condemnation case. State and local condemning authorities must follow the reimbursement provisions of the URA when they are using federal funds in their projects. Illinois formerly did not have a state version of the URA. As a result, prior to the 2007 adoption of the Eminent Domain Act, relocation assistance was not available to owners or tenants if the condemnation was for a project not using federal funds. Section 10-5-62 of the EDA requires that all condemning authorities, regardless of whether federal funds are involved, pay to displaced persons relocation costs determined in accordance with the federal URA. 735 ILCS 30/10-5-62. This removes the former discrepancy in treatment of owners and tenants. This provision applies regardless of whether the taking is for public ownership or for private ownership or control. Illinois has adopted the relocation assistance provisions of the federal URA. While the determination of the amount of relocation assistance is made on an administrative basis outside the condemnation proceeding, an attorney representing an owner should be aware of this additional source of compensation. C. Fair Cash Market Value 1. [7.23] Determining Fair Cash Market Value Section 10-5-60 of the Eminent Domain Act defines the term “fair cash market value” as “the amount of money that a purchaser, willing, but not obligated, to buy the property, would pay to an owner willing, but not obliged, to sell in a voluntary sale.” 735 ILCS 30/10-5-60. This



definition is consistent with the Supreme Court’s prior construction of the term. In Housing Authority of City of East St. Louis v. Kosydor, 17 Ill.2d 602, 162 N.E.2d 357, 359 (1959), the Supreme Court observed:

The value to the owner of the property taken or damaged for his particular purposes, or its value to the condemnor for some special use, [has] been rejected in favor of the “market value” of the property at the highest and best use to which it is adapted. . . . This objective standard has been adopted in most jurisdictions. . . . Market value is the price which property would bring if it were offered for sale by a willing seller to a willing buyer. . . . In most instances the condemnee’s investment is compensated by valuing his property at the highest and best use to which it is presently adapted, even though it is not being applied to that use. . . . At times he will even turn a profit on his investment. . . . But the constitution requires only that the owner obtain the fair market value of his property. . . . [I]t it does not guarantee him a return of his investment. [Citations omitted.]

The focus is on the property itself. The market value concept excludes any special value to the owner for his or her particular purpose or any special value to the condemnor for its special use. City of Chicago v. Harrison-Halsted Building Corp., 11 Ill.2d 431, 143 N.E.2d 40 (1957); Chicago & Illinois Midland Ry. v. Crystal Lake Industrial Park, Inc., 225 Ill.App.3d 653, 588 N.E.2d 337, 167 Ill.Dec. 696 (3d Dist. 1992). Market value also means that the property must be valued in its physical condition on the valuation date. An appraiser may not assume a proposed, but not constructed, improvement has actually been constructed on the valuation date. Southwestern Illinois Development Authority v. Al-Muhajirum, 348 Ill.App.3d 398, 809 N.E.2d 730, 284 Ill.Dec. 164 (5th Dist. 2004). Although the law determines what elements may be considered in proving market value, the actual proof is a question of fact and must be proved like any other fact. Peoples Gas Light & Coke Co. v. Buckles, 24 Ill.2d 520, 182 N.E.2d 169 (1962). Among the elements that may be considered are the size, shape, location, topography, zoning, utilities, use, and improvements on the property. Admissions as to the value of property made by the owner are also admissible if sufficiently near the valuation date to be of use to the jury. Oak Brook Park District v. Oak Brook Development Co., 170 Ill.App.3d 221, 524 N.E.2d 213, 120 Ill.Dec. 448 (2d Dist. 1988). The parties may also submit sales of comparable properties and offer the opinion testimony of real estate experts. As discussed in the following sections, there are three classic approaches to appraising real estate: (a) the market or comparable-sales approach; (b) the cost approach; and (c) the income approach. UNIFORM STANDARDS OF PROFESSIONAL APPRAISAL PRACTICE (Appraisal Foundation, 2016 – 2017), www.uspap.org, Standards Rule 1-4(a) through 1-4(c). Appraisers should use the comparable-sales approach whenever possible. However, there is no requirement that an appraiser use all three approaches CNB Bank & Trust, N.A. v. Rosentreter, 2015 IL App (4th) 140141, 39 N.E.3d 337, 395 Ill.Dec. 870.

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a. [7.24] Market or Comparable-Sales Approach At the outset, a confusion in terminology exists between the fair cash market value of property and the market approach to determining value. The market approach is simply one of three methods, the other two being the cost and income approaches, that may be used to reach an opinion of the fair cash market value of property. But the Illinois courts strongly prefer the market approach to any other method of determining value. Sometimes the market approach is referred to as the comparable-sales approach. Use of the market approach involves identifying sales of other properties and then comparing those sales to the condemned property to arrive at an opinion of the fair cash market value of the condemned property. Information about the sales may be presented to the jury either as independent evidence of market value by separately introducing the sale through the testimony of a person who participated in the sale or as part of the basis for the expert’s opinion by having the expert describe the sale and compare it to the condemned property. When evidence of another sale is offered as independent evidence of the value of the condemned property, the party offering the evidence has the burden of demonstrating that the sale property is comparable to the subject property. City of Evanston v. Piotrowicz, 20 Ill.2d 512, 170 N.E.2d 569 (1960). If the other side contests the sale’s comparability, then the trial court must conduct a hearing outside the jury’s presence, at which time the proponent presents direct evidence of the sale through a broker, attorney, or other person involved in the sale. If the trial court finds that the proffered sales were “voluntary sales of similar parcels occurring in the same vicinity at or about the time of filing” (City of Chicago ex rel. Schools v. Blanton, 15 Ill.2d 198, 154 N.E.2d 242, 244 (1958)), the trial court admits the sales as collateral evidence of value. The proponent then directly presents the sales evidence to the jury. The decision to admit or exclude comparable-sales evidence is within the court’s discretion. Further, even if the court improperly admits or excludes sales, this may be harmless error. Department of Transportation v. Chicago Title & Trust Co., 303 Ill.App.3d 484, 707 N.E.2d 637, 236 Ill.Dec. 510 (1st Dist. 1999). The opposing party may object to the introduction of evidence concerning a sale on the basis that it is not comparable. But if the objection is made and overruled, the party must preserve the objection throughout the trial to base an appeal on the ruling. In Kassnel v. Village of Rosemont, 135 Ill.App.3d 361, 481 N.E.2d 849, 855, 90 Ill.Dec. 49 (1st Dist. 1985), the owner’s counsel objected to the introduction of comparable-sales evidence during the trial; however, in final argument, the owner’s counsel advised the trial court: “So, you can consider these sales and you can to the extent necessary to figure out what you believe are the similar factors or screen out the others and come to a decision as to what is fair and just for this land owner.” The appellate court held that, by reason of this statement, the owner had waived any objection to the admission of the sales evidence. Some sales of properties are not admissible even if the sales properties themselves are comparable to the condemned property. Sales made under the threat of condemnation are considered to be the result of forced transactions, rather than voluntary ones. South Park Com’rs v. Ayer, 237 Ill. 211, 86 N.E. 704 (1908); Oak Brook Park District v. Oak Brook Development Co., 170 Ill.App.3d 221, 524 N.E.2d 213, 120 Ill.Dec. 448 (2d Dist. 1988). Evidence of assemblage sales may also be inadmissible if the buyer pays a premium to acquire the property to



complete the assemblage. Trustees of Schools of Township Number 37 North Range Number 13 East, Cook County, Illinois v. Chicago City Bank & Trust Co., 126 Ill.App.2d 302, 262 N.E.2d 80 (1st Dist. 1970). In both these situations, the sale price may not reflect true market value, and, therefore, the sale is not relevant to determining the market value of the condemned property. If the sale price reflects the market value of the property, then evidence of the sale, even if an assemblage, may be admitted. People ex rel. Department of Transportation v. Birger, 155 Ill.App.3d 130, 507 N.E.2d 1321, 107 Ill.Dec. 952 (5th Dist. 1987). For an example of the use of poor comparable sales that led to the barring of an appraiser’s opinion, see Board of Trustees of University of Illinois v. Shapiro, 343 Ill.App.3d 943, 799 N.E.2d 383, 278 Ill.Dec. 665 (1st Dist. 2003). Here, the appraiser improperly used sales made under the threat of condemnation and sales of improved property when the subject property was vacant. The appellate court denounced the use of improved comparable sales in a vacant land appraisal “unless the properties are otherwise closely comparable in size, use, zoning and locale.” 799 N.E.2d at 390. A prior sale of the subject property is usually the best evidence of market value. But if the real estate market has significantly changed since the sale or if the property itself has undergone substantial change, then the prior sale of the subject property may not be admitted in evidence. Illinois State Toll Highway Authority v. Grand Mandarin Restaurant, Inc., 189 Ill.App.3d 355, 544 N.E.2d 1145, 136 Ill.Dec. 370 (2d Dist. 1989) (property substantially improved after sale, thereby rendering sales price inadmissible); Illinois State Toll Highway Authority v. American National Bank & Trust Company of Chicago, 236 Ill.App.3d 696, 606 N.E.2d 147, 179 Ill.Dec. 315 (2d Dist. 1992) (property assembled after sale, thereby rendering sales price inadmissible). The fact that the sale occurred after the valuation date does not act as a per se bar to admissibility. The proponent of the sale must prove the sales price was not affected by the public project involved in the case. Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 250 Ill.App.3d 665, 619 N.E.2d 1321, 189 Ill.Dec. 272 (2d Dist. 1993). In the absence of sales evidence, offers to purchase may be admitted as evidence of market value provided they are bona fide and made before the valuation date. Blanton, supra; Department of Public Works & Buildings v. Lambert, 411 Ill. 183, 103 N.E.2d 356 (1952). In County of St. Clair v. Wilson, 284 Ill.App.3d 79, 672 N.E.2d 27. 30, 219 Ill.Dec. 712 (5th Dist. 1996), the appellate court held the trial court erred when it excluded testimony regarding offers to purchase property adjacent to the property being acquired. According to the opinion, all experts on both sides had agreed that in making their valuation they would reasonably rely on bona fide offers to purchase the adjacent property. Based on this concession, and based on the rationale for Fed.R.Evid. 703 and 705, the appellate court concluded that “[t]he admission of testimony about offers to purchase is not dependent upon the presence or absence of evidence of comparable sales figures.” 672 N.E.2d at 30. The appellate court cited, but did not discuss, how its ruling squared with the Illinois Supreme Court’s ruling in Lambert, supra, that offers to purchase are admissible only in the absence of evidence of actual sales. Offers made after the valuation date, even offers for the subject property, are not admissible. Illinois State Toll Highway Authority v. Dicke, 208 Ill.App.3d 158, 566 N.E.2d 1003, 153 Ill.Dec. 153 (2d Dist. 1991); Village of Woodridge v. Board of Education of Community High School District 99, 403 Ill.App.3d 559, 933 N.E.2d 392, 342 Ill.Dec. 806 (2d Dist. 2010). Under no circumstances will a trial court admit evidence of



settlements made by the condemnor with other property owners in the area. Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 196 Ill.App.3d 5, 552 N.E.2d 1151, 142 Ill.Dec. 410 (2d Dist. 1990). To be admissible, the offer must be for a definite price and cannot be contingent. Village of Woodridge, supra. An expert witness may also present sales information to the jury by describing the sales relied on in forming his or her opinion of value. The appraiser could rely on sales of property that were not admitted as independent, comparable sales. Department of Public Works & Buildings of State of Illinois ex rel. People v. Lankford, 65 Ill.App.2d 133, 212 N.E.2d 14 (4th Dist. 1965); Department of Public Works & Buildings of State of Illinois ex rel. People v. Seeber, 93 Ill.App.2d 271, 235 N.E.2d 269 (4th Dist. 1968). Formerly, when describing these “foundation” sales, the appraiser could not directly mention the actual sales price or otherwise attempt to structure the testimony to indicate the sales price if the foundation sale had not been previously admitted as a comparable sale. Lake County Forest Preserve District v. Bank & Trust Company of Arlington Heights, 106 Ill.App.3d 856, 436 N.E.2d 237, 247, 62 Ill.Dec. 487 (2d Dist. 1982). With the advent of Fed.R.Evid. 703 and 705 as well as Ill.R.Evid. 703, an appraiser may relate the price and other details of comparable sales, even if not previously independently admitted in evidence, provided the trial court concludes an expert could reasonably rely on them and another rule of evidence does not bar them. Department of Conservation of State of Illinois v. Dorner, 192 Ill.App.3d 333, 548 N.E.2d 749, 139 Ill.Dec. 364 (1st Dist. 1989); City of Chicago v. Anthony, 136 Ill.2d 169, 554 N.E.2d 1381, 144 Ill.Dec. 93 (1990). See §§7.11 and 7.12 above for a more detailed discussion of this issue. b. [7.25] Cost Approach Use of the cost approach is fraught with danger because the courts have on occasion permitted valuation testimony that considered the cost approach and on other occasions have stricken valuation testimony based on the cost approach. As a general rule, an appraiser may use the cost approach as a check on or in conjunction with the market approach but may not rely on it exclusively. Department of Public Works & Buildings v. Divit, 25 Ill.2d 93, 182 N.E.2d 749 (1962). The replacement or reproduction cost of buildings is only one element a witness may consider. Department of Public Works & Buildings v. Pellini, 7 Ill.2d 367, 131 N.E.2d 55 (1955). When using this approach, one must recognize that the value of the entire property as a whole, not the separate value of the land and buildings, is the controlling issue. Chicago Land Clearance Commission v. Darrow, 12 Ill.2d 365, 146 N.E.2d 1 (1957). Thus, the appraiser may add the value of the land and the contributory value of the improvements only if the final valuation is based on the property as a whole. Department of Transportation of State of Illinois ex rel. People v. Gass, 165 Ill.App.3d 562, 519 N.E.2d 90, 116 Ill.Dec. 500 (5th Dist. 1988). See also County of St. Clair v. Wilson, 284 Ill.App.3d 79, 672 N.E.2d 27, 219 Ill.Dec. 712 (5th Dist. 1996). The courts resist the cost approach for two reasons. The first concerns a potential misuse of the approach by emphasizing the value of the property to the owner rather than the market value. In City of Chicago v. Giedraitis, 14 Ill.2d 45, 150 N.E.2d 577, 580 (1958), the Supreme Court



upheld the trial court’s refusal to permit the owner to introduce the cost of certain improvements made to the property by stating:

Neither do we believe that the trial court erred in excluding Dorothy Giedraitis’ testimony concerning amounts which she had expended since 1948 in improving the premises. Although replacement or reproduction costs may under certain circumstances be material, this proffered proof was not designed for that purpose but sought only to show the appellant’s investment and was therefore clearly inadmissible. The test is not what the improvements originally cost or the sum that the owner has expended therein, but rather it is the amount for which the entire property would voluntarily sell. . . . Furthermore, even were we to consider this as an attempt to prove replacement costs, the testimony would be equally objectionable since no evidence of reasonable depreciation was ever offered. [Citation omitted.]

The second and more frequent reason for excluding testimony based on the cost approach arises when the witness misuses the approach by simply adding the value of the vacant land to the value of the building without making any adjustment. In Department of Public Works & Buildings v. Lotta, 27 Ill.2d 455, 189 N.E.2d 238, 240 (1963), the Supreme Court upheld the trial court’s decision to strike an appraiser’s testimony on the following basis:

We have consistently held that the fair market value of improved property is not the sum of the value of the building and the value of the land computed separately. For this purpose, the whole does not necessarily equal the sum of the parts. The value of unimproved land, adaptable for any use, may diminish, as land, when improved by the construction of a building and so committed to a particular use. For similar reasons, the construction of a building may not produce an increment in value equal to its cost, since the improvement may not be desirably situated. To avoid misleading and confusing the jury, the evidence may properly be confined to the value directly at issue, that is, the value of the improved land as a whole.

A 1976 Supreme Court decision considering the cost approach is Department of Transportation v. Quincy Coach House, Inc., 64 Ill.2d 350, 356 N.E.2d 13, 1 Ill.Dec. 13 (1976). At the trial, the owner’s appraiser reached an opinion of value that was the exact sum of its land value and reproduction cost of buildings but testified that the “improvements were ‘compatible’ with the land.” 356 N.E.2d at 19. Based on this assertion, both the trial court and the Fourth District Appellate Court upheld admission of the testimony. People ex rel. Department of Transportation v. Quincy Coach House, Inc., 29 Ill.App.3d 616, 332 N.E.2d 21 (4th Dist. 1975). The Supreme Court reversed. Holding that the term “compatible” may refute the existence of a gross disparity between the market value of the property and the total value of land and improvements, the Supreme Court nevertheless stated this vague term “is too indefinite to provide the necessary showing that the market value was enhanced to the extent of the cost of reproducing the improvements.” 356 N.E.2d at 19. Presumably a much more specific analysis would be required. Although decided before Quincy Coach House, the Fifth District’s opinion in Department of Transportation of State of Illinois ex rel. People v. Gallay, 20 Ill.App.3d 32, 312 N.E.2d 759 (5th Dist. 1974), demonstrates an acceptable use of the cost approach. An unacceptable use, which



like the Quincy Coach House situation featured vague and uncertain testimony, is found in Central Illinois Public Service Co. v. Gibbel, 65 Ill.App.3d 890, 382 N.E.2d 846, 22 Ill.Dec. 456 (4th Dist. 1978). c. [7.26] Income Approach Like the cost approach, the income approach is also subject to pitfalls. If the property is subject to a valid, arm’s-length lease with a third party, an appraiser may consider the rental income. City of Chicago v. Lord, 276 Ill. 544, 115 N.E. 8 (1916). The parties may also introduce in evidence the actual lease, provided it was negotiated and executed in good faith prior to commencement of the case. Department of Public Works & Buildings v. Kirkendall, 415 Ill. 214, 112 N.E.2d 611 (1953). In Forest Preserve District of Cook County v. Krol, 12 Ill.2d 139, 145 N.E.2d 599 (1957), the Supreme Court even upheld admission of a lease that had expired prior to commencement of the case. However, a different result occurred in Illinois State Toll Highway Authority v. Grand Mandarin Restaurant, Inc., 189 Ill.App.3d 355, 544 N.E.2d 1145, 136 Ill.Dec. 370 (2d Dist. 1989). The appellate court upheld exclusion of a lease on the subject property that had been terminated five years prior to the valuation date because the lease was too remote in time and the owner had substantially improved the property after termination of the lease. In Department of Transportation of State of Illinois ex rel. People v. Bouy, 69 Ill.App.3d 29, 386 N.E.2d 1163, 25 Ill.Dec. 499 (4th Dist. 1979), the appellate court approved the use of an income approach to value a cemetery, while in Department of Public Works & Buildings of State of Illinois ex rel. People v. Brockmeier, 128 Ill.App.2d 395, 262 N.E.2d 345 (5th Dist. 1970), the appellate court approved an income valuation of a sod farm because there were no comparable sales and the property had a special value, although it was not special-use property. Relying on Brockmeier, the appellate court also approved an income valuation of a horseradish farm in Department of Transportation of State of Illinois ex rel. People v. Keller, 149 Ill.App.3d 829, 500 N.E.2d 982, 102 Ill.Dec. 881 (5th Dist. 1986). Both Brockmeier and Keller were premised on a finding that each property had a special value arising out of the unique capabilities of the soil, not the capabilities of the farmers. When the property is not actually leased, however, the income approach becomes much more suspect. Without actual rent receipts, determining anticipated rentals and projected expenses may become very speculative. In those situations, the Supreme Court considers the results to be too theoretical and uncertain to be accepted as evidence of market value. City of Chicago v. Giedraitis, 14 Ill.2d 45, 150 N.E.2d 577 (1958); Department of Transportation v. Quincy Coach House, Inc., 64 Ill.2d 350, 356 N.E.2d 13, 1 Ill.Dec. 13 (1976). Similarly, the appellate court disapproved of an income approach for a hotel that was based on speculative projections of future income. Reynolds v. Coleman, 173 Ill.App.3d 585, 527 N.E.2d 897, 123 Ill.Dec. 259 (1st Dist. 1988). The Supreme Court addressed the proper treatment of proposed but unexecuted leases for the subject property as well as actual leases of other property in City of Chicago v. Anthony, 136 Ill.2d 169, 554 N.E.2d 1381, 1391, 144 Ill.Dec. 93 (1990). The First District held the trial court had erred when it precluded an expert from testifying as to the potential income from a proposed but unexecuted lease for a billboard on the condemned property and when it precluded evidence of the average billboard rental income produced by other signs at other properties. City of



Chicago v. Anthony, 174 Ill.App.3d 288, 528 N.E.2d 298, 123 Ill.Dec. 753 (1st Dist. 1988). Referring to Fed.R.Evid. 703, as interpreted in Department of Transportation v. Beeson, 137 Ill.App.3d 908, 485 N.E.2d 511, 92 Ill.Dec. 700 (2d Dist. 1985), the appellate court found this evidence neither too speculative nor too futuristic and, therefore, reasonably relied on by the expert. The Supreme Court disagreed. It reversed the appellate court, held the trial court acted within its discretion when it found the sign lease proposal to be too speculative, and restricted the reach of Fed.R.Evid. 703 by approving the exclusion of the expert’s testimony that he relied on this proposal. The court determined such reliance would not be reasonable. The Supreme Court also approved the exclusion of the expert’s testimony concerning average sign rental income of other properties, stating:

Under the eminent domain law of this State, there may be circumstances where an expert may be permitted to state the particulars of a rental agreement as a basis for an opinion of fair cash market value. [See Kirkendall, supra, 112 N.E.2d at 615.] Each eminent domain case, however, must be decided on its facts. Even if it might be proper, under the appropriate circumstances, to allow an expert to testify about the average sign rental income received on comparable properties in a condemnation case as an underlying fact or data upon which the expert relied in reaching an opinion of the fair cash market value of the subject property, such circumstances are not present here. The circuit court correctly prohibited defendant’s expert from stating the specifics of the rental income contained in the sign lease proposal as a basis for his opinion of the fair cash market value of the subject property. As a result, the actual dollar amounts of income received pursuant to other sign leasing agreements on other parcels of property would not serve to “shed light” upon the basis for the expert’s opinion regarding rental income set out in the sign lease proposal. Anthony, supra, 554 N.E.2d at 1391.

As for the valuation of billboards themselves, the appellate court upheld use of the income approach, as well as the cost and market approaches, in Department of Transportation v. Drury Displays, Inc., 327 Ill.App.3d 881, 764 N.E.2d 166, 172, 261 Ill.Dec. 875 (5th Dist. 2002). The appellate court based its ruling, in part, on the 1993 amendment to former 735 ILCS 5/7-101 now 735 ILCS 30/10-5-5, which the court “rephrased colloquially as: Billboard owners have a right to just compensation for any condemned sign.” Id. The Third District Appellate Court held that if a billboard lease is condemned as part of the acquisition of fee simple title to the property on which the billboard is located, the measure of compensation for the billboard lease is based on the bonus value of the lease rather than on lost income. Department of Transportation v. East Side Development, L.L.C., 384 Ill.App.3d 295, 892 N.E.2d 136, 322 Ill.Dec. 889 (3d Dist. 2008). In a close decision, the Supreme Court approved testimony of experts based on a combination of actual and estimated expenses and rentals when the appraisers were knowledgeable and the property that was appraised, an apartment building, was typically rented. Department of Public Works & Buildings v. Pellini, 7 Ill.2d 367, 131 N.E.2d 55 (1955). See also Department of Public Works & Buildings of State of Illinois v. Camboni’s Inc., 90 Ill.App.2d 421, 232 N.E.2d 747 (2d Dist. 1967); City of Chicago ex rel. Schools v. Exchange National Bank of Chicago, 64 Ill.App.2d 455, 212 N.E.2d 494 (1st Dist. 1965).



The courts also prohibit an owner from introducing evidence of gross sales from an owner-occupied property in an attempt to establish the property’s rental value. City of Chicago v. Central National Bank in Chicago, 5 Ill.2d 164, 125 N.E.2d 94 (1955). Not only do owner-generated gross sales involve speculative factors, but they also depend on the owner’s ability to generate sales and thus reflect the peculiar value of the property to the owner instead of its market value. In Chicago Land Clearance Commission v. Darrow, 12 Ill.2d 365, 146 N.E.2d 1, 5 – 6 (1957), the Supreme Court adopted the following reasoning in rejecting an owner’s argument that the net income was derived from the property itself and not from the business conducted on the property:

In every case where real estate is a necessary part of the business, income from the business can be said in some measure to derive from the property itself. Surely there is nothing magical about this property which enables it to produce income without the invested capital and managerial skill of the Chroman brothers, not to mention the economic vicissitudes attendant with any endeavor for profit. Whether it is described as a business operated on the property or a business of operating the property, the profits derived therefrom are too uncertain and depend on too many contingencies to safely be accepted as any evidence of the fair, cash market value of the property. Thus, the trial court properly excluded defendants’ offer to prove the gross income, expenses and net income from the operation of the Ford Hotel.

An expert who desires to employ the income approach should use it as one method among others in arriving at the ultimate conclusion of fair market value. The other factors should include the expert’s experience, the property itself, and sales of similar properties, if there are any. Like the cost approach, the income approach should not be used as the sole approach to valuation to conform to the Supreme Court’s position in Quincy Coach House, supra. Finally, use of the income approach does not warrant admission of the market value of the leasehold interest when there is a fee simple taking. Department of Transportation v. White, 264 Ill.App.3d 145, 636 N.E.2d 1204, 201 Ill.Dec. 772 (5th Dist. 1994). The value of the leasehold interest comes into play under these circumstances when it comes time to allocate the just compensation award. The trial judge conducts the apportionment hearing after the jury has established the just compensation. This process should be distinguished from situations in which only the leasehold interest is being condemned. See, e.g., Drury Displays, supra. 2. [7.27] Elements Excluded from Fair Cash Market Value An appraiser may not consider certain elements in arriving at an opinion of market value. Sometimes, the courts or the General Assembly decided to exclude the improper elements for public policy reasons even though they may actually affect the market value. In other instances, the courts determined the improper elements were not relevant to the market value of the property. Sections 7.28 – 7.34 below consider some of the most frequently encountered improper elements.



a. [7.28] Appreciation or Depreciation Caused by Project In many cases, the public project for which the property is being acquired will affect the market value of property in the area. For example, if the Illinois Department of Transportation announces plans to construct a new interchange on a highway, land values in the area of the new interchange may rise drastically. Reasoning that the state should not be required to pay for additional value it has created when it acquires property for projects such as an interchange, the General Assembly enacted §10-5-60 of the Eminent Domain Act, which excludes “any appreciation in value proximately caused by the improvement and any depreciation in value proximately caused by the improvement” unless the appreciation or depreciation is caused by a separate project. 735 ILCS 30/10-5-60. Under this statute, an owner may establish the amount of depreciation in the value of the property attributable to the public improvement itself. City of Rock Island, Illinois v. Moline National Bank, 54 Ill.App.3d 853, 368 N.E.2d 1113, 11 Ill.Dec. 505 (3d Dist. 1977). But the witness must clearly identify the specific project as the cause of either appreciation or depreciation; the witness cannot merely refer to the general activities of the condemnor in the area. Forest Preserve District of DuPage County, Illinois v. Valente, 61 Ill.App.3d 887, 378 N.E.2d 345, 18 Ill.Dec. 881 (2d Dist. 1978). If the proposed use by the condemnor will not change the character of the property, the witness may consider the condemnor’s activity in the area. Department of Conservation of State of Illinois ex rel. People v. Strassheim, 92 Ill.App.3d 689, 415 N.E.2d 1346, 48 Ill.Dec. 62 (2d Dist. 1981). If an appraiser fails to follow the “scope of project” rule, the trial court should bar the appraiser’s opinion. City of Chicago v. Eychaner, 2015 IL App (1st) 131833, 26 N.E.3d 501, 389 Ill.Dec. 411. These restrictions parallel the same rules that prohibit appraising the property on the basis of the condemnor’s need for the property to construct the improvement. For example, an owner whose property is being acquired for landfill for a bridge to be constructed in the area cannot predicate value on the market for landfill created by the condemnor. Department of Transportation v. Toledo, Peoria & Western R.R., 75 Ill.2d 436, 389 N.E.2d 546, 27 Ill.Dec. 482 (1979). See also Peoples Gas Light & Coke Co. v. Buckles, 24 Ill.2d 520, 182 N.E.2d 169 (1962). On the other hand, if the owner proves that a market exists for the property independent of the needs of the condemnor, the owner may predicate value based on that market. Department of Transportation ex rel. People v. Farnsworth, 273 Ill.App.3d 631, 653 N.E.2d 423, 210 Ill.Dec. 518 (3d Dist. 1995). b. [7.29] Illegal Use Section 10-5-50 of the Eminent Domain Act states:

Evidence is admissible as to: . . . (2) any unsafe, unsanitary, substandard, or other illegal condition, use, or occupancy of the property, including any violation of any environmental law or regulation; (3) the effect of such condition on income from or the fair market value of the property; and (4) the reasonable cost of causing the property to be placed in a legal condition, use, or occupancy, including compliance



with environmental laws and regulations. Such evidence is admissible notwithstanding the absence of any official action taken to require the correction or abatement of the illegal condition, use, or occupancy. 735 ILCS 30/10-5-50.

The appellate court considered the scope of §10-5-50 (former 735 ILCS 5/7-119 and former Ill.Rev.Stat. (1989), c. 110, ¶7-119) for the first time in Illinois State Toll Highway Authority v. West Suburban Bank, 208 Ill.App.3d 923, 567 N.E.2d 730, 153 Ill.Dec. 772 (2d Dist. 1991). In a case that involved the partial acquisition for an intersection widening from a Firestone tire franchise that serviced semitrailer trucks, the Illinois State Toll Highway Authority sought to introduce evidence that the Firestone dealer might have illegally used the adjoining state and county right-of-way for parking trucks being serviced. The appellate court made two important rulings: (1) this section applies only to the illegal use of the subject property, not to the illegal use of adjacent property by the owner of the subject property; and (2) evidence of any illegal encroachments on adjacent rights-of-way must clearly affect the fair market value of the subject property to be relevant and admissible. The necessity of establishing a close nexus between the asserted illegal condition and the market value was reinforced by the appellate court in Department of Transportation ex rel. People v. Parr, 259 Ill.App.3d 602, 633 N.E.2d 19, 198 Ill.Dec. 557 (3d Dist. 1994). The Illinois Department of Transportation invoked the precursor to §10-5-50, former 735 ILCS 5/7-119, as it was written prior to the 1998 amendment, in an attempt to introduce evidence of environmental remediation costs. However, both the trial and appellate courts found that IDOT had failed to prove the existence of an underlying illegal condition to justify the proffered costs. Lacking proof of such an illegal condition, IDOT could not use the prior version of the statute as a basis for admitting environmental remediation costs. The 1998 amendment to former §7-119 specifically provided for the admission of evidence relating to any violation of environmental laws or regulations and the violation’s effect on a property’s market value. The question remains whether this statutory amendment overcomes the Parr court’s concern with the due-process rights of property owners. The Parr court’s decision to bar evidence of environmental remediation costs is the minority position. A good example of the majority position that evidence of environmental contamination and remediation costs is admissible and a thorough discussion of this issue may be found in Northeast Ct. Economic Alliance, Inc. v. ATC Partnership, 256 Conn. 813, 776 A.2d 1068 (2001). See also 260 North 12th Street, LLC v. State of Wisconsin Department of Transportation, 338 Wis.2d 34, 808 N.W.2d 372 (2011). Section 10-5-50 expresses a public policy that owners should not receive any compensation arising out of illegal uses. Along similar lines, the First District upheld a cause of action seeking to impose a constructive trust on funds received in a condemnation proceeding in which the plaintiff contended the value of the property was inflated as a result of bribes paid to obtain rezoning. Chicago Park District v. Kenroy, Inc., 107 Ill.App.3d 222, 437 N.E.2d 783, 63 Ill.Dec. 134 (1st Dist. 1982). The Second District upheld a trial court’s exclusion of the value of improvements that were constructed on the property between the date of notification of the taking and the date of filing the petition to condemn. The appellate court held the improvements were not constructed in good faith. Waukegan Port District v. Booras, 55 Ill.App.3d 790, 371 N.E.2d 321, 13 Ill.Dec. 604 (2d Dist. 1977). On the other hand, if the owner acts in good faith in



anticipation of the taking and starts to dismantle improvements, the court may exclude an opinion that the highest and best use of the property had changed by the valuation date. City of Quincy, Illinois v. Diamond Construction Co., 327 Ill.App.3d 338, 762 N.E.2d 710, 261 Ill.Dec. 141 (4th Dist. 2002). Booras, supra, should be read carefully because in both Department of Transportation v. Newmark, 34 Ill.App.3d 811, 341 N.E.2d 133 (5th Dist. 1975), and Illinois State Toll Highway Authority v. Humphrey Estate, 62 Ill.App.3d 316, 379 N.E.2d 626, 19 Ill.Dec. 754 (2d Dist. 1978), the appellate courts ruled the condemnor could not offer evidence establishing the owner’s awareness of the proposed improvement at the time of purchasing the property. Obviously, there are some tensions between these decisions (foreknowledge is admissible) and Diamond Construction, supra (foreknowledge is inadmissible). c. [7.30] Business Done on Property Since the market value standard attempts to achieve an objective or a neutral method of valuing property, the courts have rejected any valuations that consider the amount of business conducted on the site or the profits from that business. The reasons for this position are succinctly expressed in one of the first decisions to preclude such evidence, Jacksonville & Southeastern Ry. v. Walsh, 106 Ill. 253, 256 (1883):

Again, one person can do a greatly larger business in the same calling, at the same place, and under the same circumstances, than another. It may be that appellee could, in that saloon, do double the amount of business that any other person could do. Such considerations are purely contingent, and altogether speculative, and can not form the basis for fixing the price of the property, and its market value was the question involved, and which the jury were required to find.

For these reasons, parties cannot introduce evidence of the going value of the property based on the conduct of business, the value of the products produced, or the costs of production. City of Chicago v. Farwell, 286 Ill. 415, 121 N.E. 795 (1918). Similarly, the volume of business or the profits generated by the business are inadmissible. Forest Preserve Dist. of Cook County v. Hahn, 341 Ill. 599, 173 N.E. 763 (1930); Reynolds v. Coleman, 173 Ill.App.3d 585, 527 N.E.2d 897, 123 Ill.Dec. 259 (1st Dist. 1988). See also Department of Transportation v. East Side Development, L.L.C., 384 Ill.App.3d 295, 892 N.E.2d 136, 322 Ill.Dec. 889 (3d Dist. 2008) (with respect to compensation for acquisition of billboard lease); Department of Transportation v. Singh, 393 Ill.App.3d 458, 914 N.E.2d 511, 333 Ill.Dec. 92 (2d Dist. 2009) (with respect to full acquisition of gasoline service station); Al’s Service Center v. BP Products North America, Inc., 599 F.3d 720 (7th Cir. 2010) (with respect to partial taking of property improved with gasoline service station). This rule works both ways: the owner cannot show increased value as a result of his or her financial status or successful business, and the condemnor cannot show decreased value as a result of the owner’s financial problems or unprofitable business. Department of Public Works & Buildings v. Lambert, 411 Ill. 183, 103 N.E.2d 356 (1952). Since the book value of property is



not the same as its market value, the courts will also exclude the balance sheet of the corporation owning the property. County of Cook v. Vulcan Materials Co., 16 Ill.2d 385, 158 N.E.2d 12 (1959). The emphasis on market value precludes evidence of value based on an owner’s ability to obtain financing commitments for a particular project or the owner’s outlay of capital for future planning. City of Chicago v. Provus, 415 Ill. 618, 114 N.E.2d 793 (1953); City of Chicago ex rel. Schools v. American National Bank & Trust Company of Chicago, 7 Ill.App.3d 1006, 288 N.E.2d 627 (1st Dist. 1972). Evidence of business operations at the property may be admissible to prove changes created by a partial acquisition if it tends to prove damage to the remainder caused by the acquisition. In Department of Transportation v. Shell Oil Co., 156 Ill.App.3d 304, 509 N.E.2d 596, 108 Ill.Dec. 900 (1st Dist. 1987), the appellate court approved evidence of the decrease in volume of gasoline sold after a partial acquisition of a gasoline service station for a road widening on the grounds this evidence related to the difference in ease of access to the pump islands before and after the taking. In turn, the change in ease of access related to the diminution in value of the remainder after the taking. The court expressly took note that ownership of the station remained the same, that no changes in laws or licensing had occurred, and that the ease of access to the station bore relevance to the market value of the property after the acquisition. d. [7.31] Cost of Moving If the condemnor does not acquire the owner’s equipment or stock in trade, the cost of moving these items and other personal property is not considered to be part of the just compensation required to be paid in the condemnation case. Housing Authority of City of East St. Louis v. Kosydor, 17 Ill.2d 602, 162 N.E.2d 357 (1959). However, the owner may recover some of these costs outside the condemnation proceeding under the provisions either of the Eminent Domain Act’s relocation costs section (735 ILCS 30/10-5-62) or of the federal Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970. e. [7.32] Taxation Property may be valued for several different purposes, not all of which are aimed at determining market value. Appraisals made for other than market purposes may incorporate different standards and be misleading. The assessor’s valuation for tax purposes is inadmissible (City of Chicago v. Harrison-Halsted Building Corp., 11 Ill.2d 431, 143 N.E.2d 40 (1957)), as is the amount of real estate taxes on the property (Department of Public Works & Buildings of State of Illinois ex rel. People v. Cohen, 9 Ill.App.3d 85, 291 N.E.2d 883 (3d Dist. 1972)). An inheritance tax return may also be formulated under different standards and not be indicative of fair market value. Department of Transportation of State of Illinois v. Prairie Travler, Inc., 52 Ill.App.3d 799, 368 N.E.2d 144, 10 Ill.Dec. 658 (4th Dist. 1977). Attempting to show that the property was sold for taxes constitutes reversible error. City of Chicago ex rel. Schools v. Pridmore, 12 Ill.2d 447, 147 N.E.2d 54 (1957).



Inasmuch as the only duty of the jury is to determine just compensation, the method of financing the improvement is irrelevant, and therefore the jury should not be advised of the source of the condemnor’s funds. City of Quincy v. V.E. Best Plumbing & Heating Supply Co., 17 Ill.2d 570, 162 N.E.2d 373 (1959). f. [7.33] Replacement Costs Market value does not include the cost of replacing improvements that have been acquired. A witness may not use replacement cost either to determine the value of a building as part of an opinion of the value of the subject property (Forest Preserve Dist. of Cook County v. Chilvers, 344 Ill. 573, 176 N.E. 720 (1931)) or to determine the money that the owner needs to purchase similar property after the subject property has been acquired (City of Chicago v. Cunnea, 329 Ill. 288, 160 N.E. 559 (1928)). g. [7.34] Existing Right-of-Way If a portion of the property to be taken is already encumbered by a right-of-way, the portion is excluded from the fair cash market value. The General Assembly amended §4-501 of the Illinois Highway Code, 605 ILCS 5/1-101, et seq., in 1979 to add a provision directed to the valuation of farmland when a portion of the land had already been a part of a highway’s right-of-way. In Department of Transportation of State of Illinois ex rel. People v. Lawler, 113 Ill.App.3d 105, 446 N.E.2d 863, 68 Ill.Dec. 692 (3d Dist. 1983), the appellate court held this amendment merely restated the existing common-law rule for valuing property that had been dedicated for public use. Since the common law awarded no compensation other than nominal compensation to the underlying fee simple owner, the appellate court ruled the trial court had erred when it required the condemnor to pay full value for the property as if it had not been encumbered by the right-of-way. 3. [7.35] Environmental Issues Section 10-5-50 of the EDA (former 735 ILCS 5/7-119) governs the admissibility of certain types of evidence. The state legislature amended the original statute by P.A. 90-393 (eff. Jan. 1, 1998). The current statute, with the language added by P.A. 90-393 in italics, states:

Admissibility of evidence. Evidence is admissible as to: (1) any benefit to the landowner that will result from the public improvement for which the eminent domain proceedings were instituted; (2) any unsafe, unsanitary, substandard, or other illegal condition, use, or occupancy of the property, including any violation of any environmental law or regulation; (3) the effect of such condition on income from or the fair market value of the property; and (4) the reasonable cost of causing the property to be placed in a legal condition, use, or occupancy, including compliance with environmental laws and regulations. Such evidence is admissible notwithstanding the absence of any official action taken to require the correction or abatement of the illegal condition, use, or occupancy. [Emphasis added.] 735 ILCS 30/10-5-50.



The amendment to former 735 ILCS 5/7-119 raises an issue as to the continued viability of the holding in Department of Transportation ex rel. People v. Parr, 259 Ill.App.3d 602, 633 N.E.2d 19, 22, 198 Ill.Dec. 557 (3d Dist. 1994). The appellate court in Parr construed this statute, in its pre-amendment form, as not permitting the admission of environmental remediation costs unless the court found an underlying illegal condition justifying such costs. In addition, the appellate court’s opinion suggests “that even if environmental remediation costs were admissible under [§10-5-50], such admission would violate the procedural due process rights of the owners of condemned property.” Id. How, and whether, the amendatory language in the statute squares with procedural due-process rights remain to be decided. See the discussion of Parr in §7.29 above, and see Chapter 12 of this publication for a more thorough discussion of environmental issues. 4. [7.36] Minerals, Timber, and Farm Property When property contains valuable natural resources such as minerals, timber, or crops, the parties may attempt to predicate value on the price for which the resources would sell. Such an approach violates both the rule against valuing the business done on the property and the rule against totaling the independent value of the land, as vacant, and the improvements, whether man-made or natural. In Forest Preserve Dist. of Cook County v. Caraher, 299 Ill. 11, 132 N.E. 211 (1921), the condemnor acquired an acreage parcel that included heavily forested land. At trial, the owner presented a professional forester who valued the timber by ascertaining how much timber was on the property, figuring the cost to harvest the timber through construction of a sawmill, estimating the expenses of marketing the timber, and finally estimating the price that the cut timber could command on the market. Holding the trial court had erred in allowing this testimony, the Supreme Court explained that the owner could take into account the valuable timber’s effect on the property’s market value, but could not consider the value of the timber as separate and distinct from the land. Permitting evidence of the value of trees when converted to lumber would introduce such collateral issues as the amount of expenses, probability of sales, etc., before the jury. The timber could be valued as part of the land but not separately from it. See also Department of Public Works & Buildings v. Hubbard, 363 Ill. 99, 1 N.E.2d 383 (1936). The courts adopted the same approach to land that has valuable minerals under the surface. Faced with an appeal involving property containing valuable sand deposits, the Supreme Court stated in Department of Public Works & Buildings v. Oberlaender, 42 Ill.2d 410, 247 N.E.2d 888, 892 (1969):

Putting it somewhat differently, where, as here, the property is not taken for the purpose of obtaining the minerals or a going business . . . it is improper to appraise separately the mineral deposit and add its value to the value of the land without the deposits. . . . It is proper, however, for the owner to establish the existence of valuable mineral deposits on the real estate being valued and in doing this to show the character of the deposit(s) and to what extent it enhances the land’s market value. [Citations omitted.]



The Supreme Court reaffirmed this position in Department of Transportation v. Toledo, Peoria & Western R.R., 75 Ill.2d 436, 389 N.E.2d 546, 27 Ill.Dec. 482 (1979), and the appellate court applied the same rule to valuation of a shale pit (Department of Transportation of State of Illinois ex rel. People v. Mullen, 120 Ill.App.3d 268, 457 N.E.2d 1362, 75 Ill.Dec. 803 (4th Dist. 1983)) and a limestone quarry (Department of Transportation ex rel. People v. Central Stone Co., 200 Ill.App.3d 841, 558 N.E.2d 742, 146 Ill.Dec. 779 (4th Dist. 1990)). The appellate court distinguished the holding in Toledo, Peoria & Western when it decided Department of Transportation ex rel. People v. Farnsworth, 273 Ill.App.3d 631, 653 N.E.2d 423, 210 Ill.Dec. 518 (3d Dist. 1995). Because the Illinois Department of Transportation was acquiring only title to fill material, and not title to the property on which the fill material was located, the appellate court in Farnsworth held the fill material could be valued based on a fixed price per cubic yard. The amount of minerals, sand, or gravel on the property must be proven by competent evidence. The owner cannot testify before first establishing the requisite knowledge and competence. Similarly, an appraiser may not testify about the sand and gravel content of property without having first established that the source of information concerning the sand or gravel content is reasonably reliable. Chicago & Illinois Midland Ry. v. Crystal Lake Industrial Park, Inc., 225 Ill.App.3d 653, 588 N.E.2d 337, 167 Ill.Dec. 696 (3d Dist. 1992). Although the Fifth District permitted an income appraisal of a sod farm when the property was characterized as having a special value and no comparable sales were available (Department of Public Works & Buildings of State of Illinois ex rel. People v. Brockmeier, 128 Ill.App.2d 395, 262 N.E.2d 345 (5th Dist. 1970)) and also permitted an income appraisal of a horseradish farm (Department of Transportation of State of Illinois ex rel. People v. Keller, 149 Ill.App.3d 829, 500 N.E.2d 982, 102 Ill.Dec. 881 (5th Dist. 1986)), the same rules that apply to timber or minerals should also apply to farm crops. Of course, if the crops are completely grown and near harvest, they could be considered personal property and outside the scope of the real estate acquisition. The General Assembly amended §4-501 of the Illinois Highway Code to cover situations in which the condemnor is acquiring farmland that had been previously dedicated for public use. 605 ILCS 5/4-501. However, this amendment merely restates the common law and does not impose any new compensation requirements. Department of Transportation of State of Illinois ex rel. People v. Lawler, 113 Ill.App.3d 105, 446 N.E.2d 863, 68 Ill.Dec. 692 (3d Dist. 1983). 5. [7.37] Subdivision Property The rule requiring compensation to be based on the land as land and not on its separate components has been extended to apply to the valuation of vacant property that has a highest and best use for subdivision development. If the land is vacant and unimproved, the witnesses may not reach their opinion of value by dividing the property into individual lots, determining the cost of developing the subdivision, and estimating the market value of the individual lots. Forest Preserve Dist. of Cook County v. Wing, 305 Ill. 194, 137 N.E. 139 (1922); Forest Preserve Dist. of Cook County v. Eckhoff, 372 Ill. 391, 24 N.E.2d 52 (1939). This subdivision theory of value was specifically rejected in Department of Public Works & Buildings of State of Illinois ex rel. People v. Huffeld, 68 Ill.App.2d 120, 215 N.E.2d 312 (3d Dist. 1966).



For similar reasons, sales of subdivision lots are not considered comparable to sales of un-subdivided property. Waukegan Park District v. First National Bank of Lake Forest, 22 Ill.2d 238, 174 N.E.2d 824 (1961). Also, sales of lots in an improved subdivision, i.e., in which streets and utilities have already been constructed, cannot form the basis for valuing unimproved subdivision property according to the appellate court in Department of Conservation of State of Illinois v. Dorner, 192 Ill.App.3d 333, 548 N.E.2d 749, 139 Ill.Dec. 364 (1st Dist. 1989). Although the subdivision theory of value was rejected in Huffeld, supra, courts have permitted cross-examination of witnesses as to the costs of development and even direct testimony of the costs of development. In Forest Preserve District of Cook County v. Galt, 412 Ill. 500, 107 N.E.2d 682 (1952), the forest preserve district acquired a large acreage parcel that both parties agreed had a highest and best use of subdivision purposes even though it was vacant and not subdivided. During the trial, the owner’s witnesses testified that they considered the cost of laying out a subdivision in reaching their opinion of value. The condemnor’s attorney then cross-examined the appraiser on the actual costs and, on rebuttal, put its own witness on the stand to testify to the costs of subdivision. The Supreme Court upheld the trial court’s decision to permit both the cross-examination on costs and rebuttal testimony since the appraiser’s theory of value involved the sale of lots for subdivision purposes. In so holding, the Supreme Court cited Smith v. Sanitary Dist. of Chicago, 260 Ill. 453, 103 N.E. 254 (1913), in which it held the condemnor should have been permitted to cross-examine witnesses on the cost of removing trees in an effort to prove that wooded property was worthless because it would cost more to remove the trees than the land would bring when cleared. The court also cited City of Chicago v. Lehmann, 262 Ill. 468, 104 N.E. 829 (1914), in which it held a party could test the opposing expert’s opinion that the property could be improved with apartments at a moderate cost by cross-examination directed to the cost of erecting the apartments and the expected rental income. Cross-examination of a witness on the costs of subdivision and use of rebuttal testimony to show the actual costs was also approved in Forest Preserve District of Cook County v. Krol, 12 Ill.2d 139, 145 N.E.2d 599 (1957). Use of non-appraisal witnesses to establish these costs was denounced in Forest Preserve District of Cook County v. Tabin, 115 Ill.App.2d 267, 253 N.E.2d 99 (1st Dist. 1969). However, at the same time it prohibited comparable sales of subdivided lots, the same court approved testimony as to the number of proposed buildable lots if the market value is dependent on the feasible number of buildable lots. Once again, the question arises whether the judicial adoption of Fed.R.Evid. 703 and 705 in Wilson v. Clark, 84 Ill.2d 186, 417 N.E.2d 1322, 49 Ill.Dec. 308 (1981), and the application of these rules to appraisal testimony in Department of Transportation v. Beeson, 137 Ill.App.3d 908, 485 N.E.2d 511, 92 Ill.Dec. 700 (2d Dist. 1985), and City of Chicago v. Anthony, 136 Ill.2d 169, 554 N.E.2d 1381, 144 Ill.Dec. 93 (1990), affect the scope of both the direct examination and cross-examination of experts in subdivision cases. The trial court still has an obligation to control the introduction of irrelevant, collateral, or misleading evidence, but the rules anticipate wide-ranging direct examination and cross-examination. Specifically, Fed.R.Evid. 705 provides that the “expert may be required to disclose those facts or data on cross-examination.” See also Piano v. Davison, 157 Ill.App.3d 649, 510 N.E.2d 1066, 110 Ill.Dec. 35 (1st Dist. 1987). If the underlying facts or data for the appraisal include a subdivision analysis, this would be subject to disclosure on cross-examination. If subject to cross-examination, it follows that disclosure might



be permitted on direct examination. This result would be consistent with Ill.R.Evid. 705, which states, in relevant part: “The expert may in any event be required to disclose the underlying facts or data on cross-examination.” 6. [7.38] Billboards Due to the hybrid nature of billboards — sometimes thought of as personal property, sometimes as fixtures, and other times as part of the real estate — the valuation of them in condemnation proceedings has taken many twists and turns. See 1 Julius Sackman et al., NICHOLS ON EMINENT DOMAIN §1.42[10][a] (rev. 3d ed. 2012). See also 8A Patrick J. Rohan and Melvin A. Reskin, NICHOLS ON EMINENT DOMAIN, Ch. G23 (3d ed. 2009). Further, governmental bodies acquired many signs pursuant to separate statutory powers set forth in the federal Highway Beautification Act of 1965, Pub.L. No. 89-285, 79 Stat. 1028, and the Highway Advertising Control Act of 1971, 225 ILCS 440/1, et seq. Section 9 of the Highway Advertising Control Act provides:

Just compensation shall include payment for the taking from the owner of any sign required to be removed under this Act of all right, title, leasehold and interest in such sign and for the taking from the owner of the real property on which the sign is located of the right to erect and maintain such sign. 225 ILCS 440/9.

Many times, compensation for these takings has been made pursuant to administrative schedules that considered only the depreciated reproduction cost of the sign. In 1993, the state legislature amended former 735 ILCS 5/7-101, now §10-5-5(b) of the Eminent Domain Act, which reads:

The right to just compensation, as provided in this Act, applies to the owner or owners of any lawfully erected off-premises outdoor advertising sign that is compelled to be altered or removed under this Act or any other statute, or under any ordinance or regulation of any municipality or other unit of local government, and also applies to the owner or owners of the property on which that sign is erected. The right to just compensation, as provided in this Act, applies to property subject to a conservation right under the Real Property Conservation Rights Act. The amount of compensation for the taking of the property shall not be diminished or reduced by virtue of the existence of the conservation right. The holder of the conservation right shall be entitled to just compensation for the value of the conservation right. 735 ILCS 30/10-5-5(b).

The Fifth District Appellate Court construed this language to grant billboard owners a right to just compensation for any condemned sign in Department of Transportation v. Drury Displays, Inc., 327 Ill.App.3d 881, 764 N.E.2d 166, 172, 261 Ill.Dec. 875 (5th Dist. 2002):

Looking at the plain language of the statute, we think the first part of the pertinent sentence might be rephrased colloquially as: Billboard owners have a right to just compensation for any condemned sign. We believe that meaning is unmistakably



clear. We reject the Department’s interpretation that “just compensation” means only [lease] bonus value. Just compensation is the fair market value of the property at its highest and best use on the date the complaint is filed.

The court rejected the Illinois Department of Transportation’s contention that its condemnation of the sign company’s leasehold interest only entitled the sign company to be paid the bonus value of its lease. Instead, the court affirmed a verdict based on appraisal testimony using the cost, income, and market approaches to value the improved leasehold interest. The Third District Appellate Court addressed the billboard amendment but came to a different conclusion than the Fifth District in Department of Transportation v. East Side Development, L.L.C., 384 Ill.App.3d 295, 892 N.E.2d 136, 322 Ill.Dec. 889 (3d Dist. 2008). Holding that the 1993 amendment to former 735 ILCS 5/7-101, now §10-5-5, did not create an exception to the unit rule, the appellate court required property that was improved with a commercial billboard to be valued as one unit. As a result, the compensation to be paid for acquisition of the billboard is based on the same measure of compensation to be paid any other lessee, i.e., the bonus value of the lease rather than the lost profits of the lessee. However, a condemning authority may acquire fee simple title subject to the existing billboard lease and then, when the lease expires, require the billboard to be removed without paying compensation. In this situation, the condemning authority is in the same position as any other fee simple holder who can let a lease terminate without having to renew it. Patrick Media Group, Inc. v. DuPage Water Commission, 258 Ill.App.3d 1068, 630 N.E.2d 958, 196 Ill.Dec. 793 (1st Dist. 1994); Lamar Advantage G.P. Co. v. Addison Park District, 354 Ill.App.3d 130, 820 N.E.2d 626, 289 Ill.Dec. 850 (2d Dist. 2004). This approach does not work when the condemnation complaint seeks to acquire not only the fee simple interest but also the leasehold interest. Drury Displays, supra. A property owner is barred from introducing evidence of a proposal from a sign company to lease a portion of the property for construction of a billboard. Evidence of specific rental income from other billboard sites is also barred when no lease exists. These elements were considered too speculative because a lease had not been executed and a sign had not been constructed in City of Chicago v. Anthony, 136 Ill.2d 169, 554 N.E.2d 1381, 144 Ill.Dec. 93 (1990). 7. [7.39] Special-Use Property Pursuant to §10-5-60 of the Eminent Domain Act, special-use property need not be valued according to the market value standard. 735 ILCS 30/10-5-60. This merely codifies the common-law rule, expressed in City of Chicago v. Farwell, 286 Ill. 415, 121 N.E. 795, 797 (1918), that “[a]s to such property the law permits a resort to any evidence available to prove value, such as the amount of business done or the use made of the property, and the like.” Farwell also shows the limitations of the special-use concept, for the Illinois courts have given it a very narrow and specific meaning. Special-use property, in the legal sense, refers only to property that “is of such nature and applied to such special use that it cannot have a market value.” Id. Dicta in the Farwell opinion indicates that a church, college, cemetery, clubhouse, or



terminal of a railroad may be considered special-use property. Since Farwell was decided in 1918, the changing nature of the real estate market, especially as related to sales of school property, calls into question the validity of the court’s dicta. More recently, the appellate courts in effect upheld an agreement to consider a cemetery to be a special-use property in Department of Transportation of State of Illinois ex rel. People v. Bouy, 69 Ill.App.3d 29, 386 N.E.2d 1163, 25 Ill.Dec. 499 (4th Dist. 1979). Drawing a distinction between special-use and special-purpose property, the Fifth District deemed a sod farm to be a special-purpose property, which may be valued solely on an income approach. Department of Public Works & Buildings of State of Illinois ex rel. People v. Brockmeier, 128 Ill.App.2d 395, 262 N.E.2d 345 (5th Dist. 1970). It also deemed a horseradish farm to have special value due to the inherent nature of the soil. Department of Transportation of State of Illinois ex rel. People v. Keller, 149 Ill.App.3d 829, 500 N.E.2d 982, 102 Ill.Dec. 881 (5th Dist. 1986). The Supreme Court reemphasized the limited nature of the special-use category in People ex rel. Director of Finance v. Young Women’s Christian Association of Springfield, 74 Ill.2d 561, 387 N.E.2d 305, 25 Ill.Dec. 649 (1979). The Supreme Court refused to grant special-use status to the Springfield YWCA, which had a gymnasium, an indoor swimming pool, locker rooms, a chapel, meeting rooms, and three kitchens. A witness also testified there was no known sale of a structure similar to the YWCA building. The Supreme Court also rejected the approach developed by the Third Circuit Court of Appeals in United States v. 564.54 Acres of Land, More or Less, Situated in Monroe & Pike Counties, Commonwealth of Pennsylvania, 576 F.2d 983 (3d Cir. 1978), rev’d on other grounds, 99 S.Ct. 1854 (1979), which requires the condemnor to value the property according to the replacement or substitute facilities’ measure of compensation if the owner is a private, nonprofit organization whose functions are reasonably necessary to the community. Reinforcing the market value rule, the United States Supreme Court held that when a market exists for the condemned property, the market value rule must be followed even if the condemned property was owned by a public body, in this case, a sanitary landfill owned by the city of Duncanville, Texas, that had the obligation to provide substitute facilities. United States v. 50 Acres of Land, 469 U.S. 24, 83 L.Ed.2d 376, 105 S.Ct. 451 (1984). The Supreme Court rejected the city’s request to have its landfill valued in relation to the cost of acquiring a substitute facility by ruling the same principles of just compensation presumptively apply to both private and public condemnees under the Fifth Amendment. The courts’ narrow application of the term “special use” contrasts with the somewhat broader application generally given to it in the real estate profession. See American Institute of Real Estate Appraisers, THE APPRAISAL OF REAL ESTATE (14th ed. 2013). As a result, when reading a valuation report or discussing a tract with an appraiser, an attorney cannot simply accept the appraiser’s conclusion that the property is special-use property. If the property can be considered a special use and if the replacement theory of valuation is used, the condemnor must be willing to pay for replacement of the entire building. The condemnor cannot base its valuation on a proposed replacement building that has substantially



less square footage than the building being acquired. City of Chicago v. George F. Harding Collection, 70 Ill.App.2d 254, 217 N.E.2d 381 (1st Dist. 1965). IV. VALUATION IN PARTIAL ACQUISITIONS A. [7.40] General Principles When a public body undertakes a partial acquisition, taking only a portion of the property and leaving a remainder, three issues arise. First, what must be paid for the part taken? Second, has the remaining property been damaged by the taking? Third, if the remainder has been damaged, what is the amount of damage? Not only must the complete property be valued, thus raising the same issues as in any complete acquisition, but also the question of damages raises additional issues. The Illinois Constitution of 1870 amended the 1848 Constitution by adding the words “or damaged” to the eminent domain article. As a result, Article II, §13, of the Illinois Constitution of 1870 read: “Private property shall not be taken or damaged for public use without just compensation.” The same language is repeated in Article I, §15, of the Illinois Constitution of 1970. In the first case to construe the meaning of the additional words “or damaged,” the Supreme Court stated: “[T]hey declare a new rule of civil conduct, from which spring new rights which did not exist under the constitution of 1848.” Rigney v. City of Chicago, 102 Ill. 64, 75 (1881). The new language overturned the old rule that authorized compensation only for an actual physical taking. Further construing the extent of this change, the Supreme Court went on to say:

The question then recurs, what additional class of cases did the framers of the new constitution intend to provide for which are not embraced in the old? While it is clear that the present constitution was intended to afford redress in a certain class of cases for which there was no remedy under the old constitution, yet we think it equally clear that it was not intended to reach every possible injury that might be occasioned by a public improvement. There are certain injuries which are necessarily incident to the ownership of property in towns or cities which directly impair the value of private property, for which the law does not, and never has, afforded any relief. For instance, the building of a jail, police station, or the like, will generally cause a direct depreciation in the value of neighboring property, yet that is clearly a case of damnum absque injuria. So as to an obstruction in a public street, — if it does not practically affect the use or enjoyment of neighboring property, and thereby impair its value, no action will lie. In all cases, to warrant a recovery it must appear there has been some direct physical disturbance of a right, either public or private, which the plaintiff enjoys in connection with his property, and which gives to it an additional value, and that by reason of such disturbance he has sustained a special damage with respect to his property in excess of that sustained by the public generally. In the absence of any statutory or constitutional provisions on the subject, the common law afforded redress in all such cases, and we



have no doubt it was the intention of the framers of the present constitution to require compensation to be made in all cases where, but for some legislative enactment, an action would lie by the common law. 102 Ill. at 80 – 81.

Subsequently, the Supreme Court elaborated on the meaning of these words in Illinois Iowa Power Co. v. Rhein, 369 Ill. 584, 17 N.E.2d 582, 588 (1938), by stating that damages may arise if the right to enjoy the remainder “is disturbed by physical means consisting of structures or actual taking, or by originating results directly affecting the land not taken.” The Supreme Court has repeatedly used this language in subsequent cases to define the type of damages that must be compensated. For example, in County Board of School Trustees of Ogle County v. Elliott, 14 Ill.2d 440, 152 N.E.2d 873 (1958), the court noted the physical disturbance need not be tangible but only need be a disturbance of a right in the remainder. As indicated in Rigney, supra, the owner’s right to recover damages may be asserted either in an action at law, if no property is taken, or in a claim made as a defendant in a condemnation case. In either instance, the right to damages is the same and is based on this constitutional provision. Illinois Power & Light Corp. v. Peterson, 322 Ill. 342, 153 N.E. 577 (1926); Horn v. City of Chicago, 403 Ill. 549, 87 N.E.2d 642 (1949). When the damages do not involve a physical taking, for example, a taking of access rights only, and the State of Illinois is involved, the appropriate forum may be the Court of Claims rather than the circuit court. See Patzner v. Baise, 133 Ill.2d 540, 552 N.E.2d 714, 142 Ill.Dec. 123 (1990). Despite the uncomplicated wording of the constitutional provision and the authoritative interpretation of that wording in Rigney, supra, the courts have not always had an easy time in deciding whether a specific claim of damage is compensable. For example, in 1901, the Supreme Court indicated in dicta that an owner could claim damage based on the unsightliness of telegraph poles that were to be erected on the part taken. Board of Trade Tel. Co. v. Darst, 192 Ill. 47, 61 N.E. 398 (1901). In 1927, the Supreme Court, rejecting its statement in Darst, refused to recognize the unsightliness of poles as a proper element of damage. Illinois Power Co. v. Wieland, 324 Ill. 411, 155 N.E. 272 (1927). The question of whether the unsightliness of power poles is a proper, compensable item of damage is still unresolved, as evidenced by the different positions adopted by the Second District in Commonwealth Edison Co. v. Danekas, 104 Ill.App.3d 907, 433 N.E.2d 736, 60 Ill.Dec. 694 (2d Dist. 1982), and the Third District in Iowa-Illinois Gas & Electric Co. v. Hoffman, 127 Ill.App.3d 496, 468 N.E.2d 977, 981, 82 Ill.Dec. 323 (3d Dist. 1984), which stated: “In so concluding, we respectfully disagree with the Second District in the Danekas case.” Because caselaw often determines whether a particular damage is compensable, the law may change over time. In Rockstead v. City of Crystal Lake, 486 F.3d 963 (7th Cir. 2006), the court of appeals was confronted with the question of whether Illinois required compensation to be paid to an owner if government action led to intermittent flooding of the owner’s property. The court of appeals acknowledged that prior Illinois decisions had precluded recovery for damages caused by intermittent flooding. People ex rel. Pratt v. Rosenfield, 399 Ill. 247, 77 N.E.2d 697 (1948). But since Rosenfield, the change in laws relating to flooded property, such as wetlands regulation, caused the court of appeals to suggest Illinois may now recognize that certain types of intermittent flooding may be deemed compensable. The United States Supreme Court



subsequently ruled that government-induced temporary flooding may constitute a taking. Arkansas Game & Fish Commission v. United States, ___ U.S. ___, 184 L.Ed.2d 417, 133 S.Ct. 511 (2012). The court of appeals decision in Rockstead, supra, proved to be prophetic because the Illinois Supreme Court subsequently held the Illinois takings clause may support claims arising out of intermittent flooding in certain circumstances. Hampton v. Metropolitan Water Reclamation District of Greater Chicago, 2016 IL 119861. Because Illinois follows the “lockstep” approach to interpreting Illinois constitutional provisions, which are the same as federal constitutional provisions, the Illinois Supreme Court applied the United States Supreme Court’s analysis to takings claims in Arkansas Game & Fish, supra. The four concurring justices in Hampton argued the recognition of possible takings claims for intermittent flooding did not overrule the court’s previous position in Rosenfield, supra. However, the three concurring justices argued that Hampton should explicitly overrule Rosenfield, because it does so implicitly. The issues presented by damage to the remainder cases were set forth by the Supreme Court in Department of Public Works & Buildings v. Barton, 371 Ill. 11, 19 N.E.2d 935, 937 – 938 (1939):

In ascertaining the compensation to be paid to an owner of land in eminent domain proceedings, the rules are comparatively simple. The owner must first be compensated for the full value of the land actually taken, without diminution in any manner; he is entitled to damages, if shown by the evidence, for the remaining land not taken, and should there be any special benefit to any part of the land not taken, brought about by the improvement, such special benefit may be offset against damages to land not taken. . . . . . . The damage, if any, to land not taken, is ascertained by the difference between the fair cash market value of the property, unaffected by the improvement, and its fair cash market value as affected by it. . . . The special benefits, if any, accruing to the property may not be set off against the land taken, but may be taken into consideration as reducing or completely offsetting any damages to the remaining part of the land. . . . In general, the effect upon land not taken is fixed by proving the difference between the fair cash market value of the property, unaffected by the improvement, and as affected by it, as this will necessarily embody not only any damage but also any special benefit brought about by the improvement. [Citations omitted.]

Under this formulation, the owner receives compensation for the property taken and for any damage to the remaining property caused by the taking. Damage to the remainder is calculated by subtracting the value of the remainder after the taking from the value of the remainder before the taking. If the taking benefits the remainder property, these benefits are set off against damages to the remainder only. They are not set off against the value of the property taken. In some other states, benefits arising out of the taking can be set off against both the value of the part taken and



the damage to the remainder. Under this approach, the benefits could offset both the part taken and damages, yielding zero compensation. The Illinois appellate court failed to distinguish these approaches when it decided City of Springfield, Illinois v. West Koke Mill Development Corp., 312 Ill.App.3d 900, 728 N.E.2d 781, 245 Ill.Dec. 699 (4th Dist. 2000). The court approved use of a truncated “before-and-after” approach, asserting that an appraiser could first value the entire parcel before the taking, then value the remainder after the taking and subtract the value of the remainder from the value of the entire property to determine the value of the area condemned. 728 N.E.2d at 785. In its opinion, the court failed to discuss the long line of Illinois caselaw requiring a different formula. The market value standard applies as equally to the determination of damage to the remainder as to the determination of the value of the part taken. To claim damage, the owner must relate the particular element of damage to the market value of the remaining property. Sanitary Dist. of Rockford v. Johnson, 343 Ill. 11, 174 N.E. 862 (1931). Thus, the rules determining the valuation date control the determination of the amount to be paid for damages as well as the amount to be paid for the part taken. East St. Louis Light & Power Co. v. Cohen, 333 Ill. 218, 164 N.E. 182 (1928). Since the issue of damage involves an assessment of the value of the remaining property after the acquisition, it is necessary to make a complete appraisal of both the part taken and the entire remaining property. Barton, supra; Central Illinois Light Co. v. Nierstheimer, 26 Ill.2d 136, 185 N.E.2d 841 (1962). Even if the owner does not claim any damage to the remainder, a complete appraisal of the entire site, including any buildings on the site, must be made in all partial acquisition cases. Lake County Forest Preserve District v. Kerrigan, 58 Ill.App.3d 249, 374 N.E.2d 27, 15 Ill.Dec. 734 (2d Dist. 1978). It is also necessary to specify the exact value of the remainder after the acquisition. Department of Public Works & Buildings of State of Illinois ex rel. People v. Crumbaugh, 1 Ill.App.3d 761, 274 N.E.2d 161 (4th Dist. 1971). To determine the effect the taking will have on the remainder, either party may introduce evidence of the proposed use of the part taken by the public body. Forest Preserve Dist. of Cook County v. Eckhoff, 372 Ill. 391, 24 N.E.2d 52 (1939); Johnson, supra. Normally, this is done through testimony or exhibits depicting the final plans for the project. However, in a case involving a traverse and a motion to dismiss hearing in which the owner contested the condemnor’s right to proceed, the appellate court denied the motion to dismiss even though the condemnor’s plans were not final. Since the project would extend over several years, the court authorized the acquisition based on plans that “were final to the extent that circumstances would reasonably allow.” Department of Transportation of State of Illinois ex rel. People v. Keller, 127 Ill.App.3d 976, 469 N.E.2d 262, 265, 82 Ill.Dec. 728 (5th Dist. 1984). See also City of Chicago v. First Bank of Oak Park, 178 Ill.App.3d 321, 533 N.E.2d 424, 127 Ill.Dec. 552 (1st Dist. 1988). The parties may introduce the condemnor’s plans for construction on adjacent property as long as the construction is reasonably certain to be done and the construction affects the value of the remainder. Department of Transportation of State of Illinois ex rel. People v. Gass, 165 Ill.App.3d 562, 519 N.E.2d 90, 116 Ill.Dec. 500 (5th Dist. 1988) (permitting evidence of plans to construct drainage ditches to alleviate drainage problems on remainder).



The plans for the project may be introduced only for the limited purpose of advising the jury of the nature of the improvement. The condemnor cannot introduce the plans or the history of the plans’ development to indicate the owner knew of the project when the property was purchased and thus should not be entitled to assert certain damages. Department of Transportation v. Newmark, 34 Ill.App.3d 811, 341 N.E.2d 133 (5th Dist. 1975); Illinois State Toll Highway Authority v. Humphrey Estate, 62 Ill.App.3d 316, 379 N.E.2d 626, 19 Ill.Dec. 754 (2d Dist. 1978). Humphrey Estate demonstrates the effect that the plans for the improvement within the part taken can have on an assessment of the market value of the remaining property. The case involved an acquisition for the construction of an interchange on the East-West Tollway between Aurora and Rock Falls, and the condemnor’s valuation witness testified that, due to the construction of the interchange and the construction of new sewer and water lines, the highest and best use of the remainder changed from farming to commercial purposes. The appellate court approved valuation testimony based on this change. Just as in complete acquisition cases, each party may adopt its own theory of the highest and best use of the remainder and of damage to the remainder. As a consequence, neither party can claim on appeal that the other party’s valuation witnesses failed to give due weight to a certain element of damage. Department of Public Works & Buildings v. Finks, 10 Ill.2d 15, 139 N.E.2d 267 (1956). The determination of the weight to be given the valuation testimony and the resultant damage that has or has not been sustained remains in the hands of the jury. All elements of damage to the remainder must be presented in the trial of the condemnation case. The doctrine of res judicata prevents the owner from claiming additional damage after completion of the eminent domain proceeding. Lake Ka-Ho, Inc. v. Kramer, 131 Ill.App.3d 782, 475 N.E.2d 1379, 86 Ill.Dec. 812 (5th Dist. 1985). When reviewing decisions or commentaries on the law respecting damage in eminent domain, one will often encounter two different descriptions of damages: consequential and severance. Although this terminology is not used consistently, “consequential damage” generally refers to damage that is non-compensable, such as lost business opportunity, while “severance damage” refers to compensable damage caused by the acquisition. In addition, in many of the older Illinois decisions, the word “damages” is used to describe the compensation to be paid both for the part taken and for depreciation in value of the remainder. B. [7.41] Cross-Petition If an owner intends to claim damage to the remainder and if the complaint filed by the condemnor does not describe the remainder, then the owner must file a pleading known as a “cross-petition.” In this pleading, the owner must describe the land that will be damaged by the taking, state the ownership interest in the land, and allege that the taking will in fact damage the remaining land. Filing a proper cross-petition is required to bring the remaining property within the jurisdiction of the court, just as filing the original condemnation complaint is required to bring the part taken within the jurisdiction of the court. If the remainder is not described in the original complaint and if a cross-petition is not filed, the court cannot consider the question of damage to



the remaining property. Central Illinois Public Service Co. v. Rider, 12 Ill.2d 326, 146 N.E.2d 48 (1957). However, a cross-petition can be used only to raise the issue of damage to the remainder. It cannot be used in place of a traverse or motion to dismiss. The owner should file the cross-petition as soon as possible. Although courts have granted an owner’s motion to file a cross-petition on the date of trial provided there was no surprise (Department of Public Works & Buildings of State of Illinois v. Hall, 30 Ill.App.3d 831, 333 N.E.2d 701 (2d Dist. 1975)), courts have, in other situations, refused motions to file the cross-petition on the date of trial (Forest Preserve District of Cook County v. Krol, 12 Ill.2d 139, 145 N.E.2d 599 (1957)) or even six days prior to the date of trial when the original condemnation complaint had been on file for over one year (Lake County Forest Preserve District v. Continental Illinois National Bank & Trust Company of Chicago, 35 Ill.App.3d 942, 343 N.E.2d 6 (2d Dist. 1976)). Filing a cross-petition may also allow the owner to request that the trial court, pursuant to S.Ct. Rule 233, exercise its discretion to grant the owner’s motion to proceed first at all stages of the trial. Department of Business & Economic Development v. Brummel, 52 Ill.2d 538, 288 N.E.2d 392 (1972). C. [7.42] Valuation of Part Taken In a partial acquisition, the parties must value the part taken as part of the entire tract before the taking. They cannot value it as a distinct entity unrelated to the rest of the tract. Chicago, B. & N. Ry. v. Bowman, 122 Ill. 595, 13 N.E. 814 (1887); Tri State Park District v. First National Bank of Cicero, 33 Ill.App.3d 348, 337 N.E.2d 204 (2d Dist. 1975). Thus, the condemnor may not ask a witness if the irregular shape of the part to be acquired would affect its value. The owner is entitled to have the part taken valued as a portion of the entire holding, not separately. Department of Public Works & Buildings v. Griffin, 305 Ill. 585, 137 N.E. 523 (1922). When the condemnor acquires a vacant strip that is part of a larger, improved tract, and when the improvements on the remaining portion of the tract add to the value of the entire tract, the condemnor must value the vacant strip as part of and in relation to this larger, improved tract and not as separate, vacant land. Forest Preserve Dist. of Cook County v. Draper, 387 Ill. 149, 56 N.E.2d 410 (1944); Department of Public Works & Buildings of State of Illinois ex rel. People v. Butler, 5 Ill.App.3d 134, 283 N.E.2d 109 (4th Dist. 1972). Conversely, if the existing improvements on the whole property do not contribute to its market value because the highest and best use is different from the existing use, the appraiser should not accord any contributory value to the improvements on the part taken. Illinois State Toll Highway Authority v. Itasca Bank & Trust Co., 216 Ill.App.3d 926, 576 N.E.2d 1221, 160 Ill.Dec. 267 (2d Dist. 1991). Simply because the improvements on the remainder add to the value of the entire tract, it does not follow that the vacant land to be acquired is as valuable as the remaining land that has improvements on it, nor does it follow that every part of the vacant land is as valuable as every other part. The part taken may be valued on a different basis than the remainder as long as the valuation approach is consistent. Department of Public Works & Buildings v. Foreman State



Trust & Savings Bank, 363 Ill. 13, 1 N.E.2d 75 (1936); Itasca Bank & Trust, supra; City of Springfield, Illinois v. West Koke Mill Development Corp., 312 Ill.App.3d 900, 728 N.E.2d 781, 245 Ill.Dec. 699 (4th Dist. 2000). However, the part taken may not be valued just by adding the value of the land, if vacant, and the value of the improvements on the part taken. The appraiser must always consider how the part taken relates to the value of the whole property. Department of Transportation v. First Bank of Schaumburg, 260 Ill.App.3d 490, 631 N.E.2d 1145, 197 Ill.Dec. 686 (1st Dist. 1992). Should the part taken include improvements, they must be valued as part of the part taken and not separately. For example, in Peoria, B. & C. Traction Co. v. Vance, 234 Ill. 36, 84 N.E. 607 (1908), the condemnor acquired a strip of property along one side of the owner’s farm. The strip included trees, and the Supreme Court held that, although the owner could not prove the value of the trees independent of the part taken, the owner could value the part taken so as to account for any increased value by reason of the presence of the trees on the part taken. On the other hand, the part taken may only have nominal value if it had previously been encumbered with an easement, such as a public highway easement. Department of Transportation v. Bolis, 313 Ill.App.3d 982, 730 N.E.2d 1152, 246 Ill.Dec. 687 (3d Dist. 2000). Relying on its understanding of the “unit rule,” the appellate court in Department of Transportation, State of Illinois v. Kelley, 352 Ill.App.3d 278, 815 N.E.2d 1214, 1215, 287 Ill.Dec. 411 (3d Dist. 2004), held that although not every part of a tract may be as valuable as other parts, when the property does not have “easily delineated” separate uses, “dividing indistinct portions of the whole” into separate zones of value is improper. A discussion of the unit rule in partial takings is in Department of Transportation ex rel. People v. Raphael, 2014 IL App (2d) 130029, 9 N.E.3d 1120, 381 Ill.Dec. 1. At issue was whether the appraiser had properly considered the contributory value of the improvement located on the remainder property when valuing the part taken. The appellate court described the unit rule in partial takings as follows:

The unit rule provides that, in partial takings, the part taken must be valued as part of the whole, considering its best use. . . . However, not every part of a tract will be as valuable as other parts. . . . Thus, the unit rule does not require the whole property to be valued on a single proportionate per-square-foot basis, ignoring the difference between the values of the part taken and the remainder. [Citations omitted.] 2014 IL App (2d) 130029 at ¶18.

While the appellate court’s summary of the unit rule appears to be straightforward, the application of the unit rule to actual takings remains difficult. The Raphael court held both the owner’s appraiser and the Illinois Department of Transportation’s appraiser had violated the unit rule: the owner’s appraiser for assigning a uniform square-foot value over the whole property, and IDOT’s appraiser for failing to consider the contributory value of improvements on the remainder when valuing the part taken. In Illinois, unlike some other jurisdictions, benefits arising out of the proposed improvement may be set off against claims of damage to the remainder to reduce the amount of damage but cannot be set off against the value of the part taken. The condemnor must compensate the owner



for the full value of the part taken without any deduction for benefits. Griffin, supra. Because benefits cannot be set off against the part taken, the practitioner should view with caution the “before-and-after” appraisal formula cited in West Koke Mill Development, supra, 728 N.E.2d at 785. D. [7.43] Stipulations When the owner files a cross-petition or otherwise claims damage to the remainder, either the owner or the condemnor can show what use will be made of the part taken to demonstrate what effect the taking will have on the remainder. Forest Preserve Dist. of Cook County v. Eckhoff, 372 Ill. 391, 24 N.E.2d 52 (1939). As a corollary of this rule, the condemnor has the absolute right to stipulate to the use of the part taken or to the benefits that will be given to the owner as part of the public project to mitigate a claim of damage to the remainder. Such a stipulation is binding on the condemnor and must be considered by the jury. East Peoria Sanitary Dist. v. Toledo, P. & W. R.R., 353 Ill. 296, 187 N.E. 512 (1933). The stipulation must accurately state the proposed use of the property to be acquired; it cannot be misleading. West Skokie Drainage Dist. v. Dawson, 243 Ill. 175, 90 N.E. 377 (1909). Stipulations may cover such areas as the access to be provided to the remainder after acquisition (Department of Public Works & Buildings of State of Illinois ex rel. People v. Kelly, 40 Ill.App.3d 896, 353 N.E.2d 195 (1st Dist. 1976)), the protective measures to be taken to avoid disturbing the remaining property (Department of Transportation of State of Illinois ex rel. People v. Mullen, 120 Ill.App.3d 268, 457 N.E.2d 1362, 75 Ill.Dec. 803 (4th Dist. 1983)), or the landscaping provided by the condemnor (Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 196 Ill.App.3d 5, 552 N.E.2d 1151, 142 Ill.Dec. 410 (2d Dist. 1990)). Since the condemnor has the right to alter and amend its plans for a public improvement as it becomes aware of new facts, courts have encouraged stipulations to reduce damages. Not only do stipulations give the condemnor needed flexibility, they also enable a jury to make its determination of damages on the basis of what actually will be done by the condemnor. These same reasons support the courts’ liberal exercise of their discretion to allow amendments to condemnation complaints “in order that the real controversy might be presented and the issues finally, and fairly, determined.” Department of Public Works & Buildings of State of Illinois ex rel. People v. Greenlee, 63 Ill.App.2d 425, 211 N.E.2d 771, 774 (2d Dist. 1965). E. [7.44] Definition of “Remainder Property” An owner cannot claim damage to the remainder unless the property allegedly damaged qualifies as remainder property. Whether property does qualify is a question of law for the court to decide. Department of Conservation of State of Illinois v. Franzen, 43 Ill.App.3d 374, 356 N.E.2d 1245, 1 Ill.Dec. 912 (2d Dist. 1976); Illinois Department of Natural Resources v. Pedigo, 348 Ill.App.3d 1044, 811 N.E.2d 761, 285 Ill.Dec. 274 (4th Dist. 2004). In City of Chicago v. Equitable Life Assurance Society of United States, 8 Ill.2d 341, 134 N.E.2d 296, 299 (1956), the classic case defining “remainder property,” the Supreme Court stated:



In order to recover damages in an eminent domain proceeding for property not actually taken, it must appear that this and the condemned land are contiguous, that is, they are either physically joined as a single unit or so inseparably connected in use that the taking of one will necessarily and permanently injure the other.

This case involved the acquisition of a parking lot owned by the Equitable Life Assurance Society but rented to Wieboldt Stores, Inc., for free customer parking to service a store. The store was located in the same block as the parking lot but was separated from it by an alley 16 feet wide. At trial, the lower court had refused to permit Equitable Life and Wieboldt to introduce evidence of damage to the store arising from the acquisition of the parking lot. On appeal, the Supreme Court affirmed the court’s ruling barring this evidence. Since the two properties were not physically connected, the only question was whether they were “inseparably connected in use.” Id. Holding that they were not, the Supreme Court pointed to the following factors: 1. Were the two properties acquired at the same time? 2. Were the two properties acquired for the same use? 3. Are the present uses of the two properties the same? 4. Do properties having similar uses also require both sites to operate? 5. Will the proposed use of the acquired property by the condemnor be the same as or different than the present use? 6. Can substitute property be located in the area? 7. Does the alleged damage to the other property arise out of the present use of the unacquired property, or does it stem from a proposed use of the unacquired property in conjunction with the acquired property? The court concluded by noting that, although the related use of the two properties was “convenient or even beneficial,” the defendants failed to prove that the taking of the parking lot would “necessarily and permanently injure the store property.” 134 N.E.2d at 300. A similar case involving the acquisition of a parking lot separated by a street from an office building under the same ownership yielded a similar result in Lake County Public Building Commission v. LaSalle National Bank, 176 Ill.App.3d 237, 531 N.E.2d 110, 125 Ill.Dec. 931 (2d Dist. 1988). The appellate court held that the property owner had failed to meet its burden of proving that the two properties were so inseparably connected in use that the condemnation of the parking lot necessarily injured the office building parcel. In an interesting case upholding the principle of substitute condemnation (condemning one property for conveying it to another property owner to reduce damage to the remainder), the appellate court ruled that a parking lot located across the street from a commercial building was part of the whole property. The beneficial owner of both properties was a partnership that “reaped all of the economic benefits resulting from both properties, including rents collected from and improvements to either



property . . . the partnership also incurred any economic losses resulting from both properties.” City of Chicago v. Midland Smelting Co., 385 Ill.App.3d 945, 896 N.E.2d 364, 392 – 393, 324 Ill.Dec. 578 (1st Dist. 2008). Lack of a unified use also precluded an owner from claiming damage to the remainder when one property was separated from the other by a highway. Department of Transportation v. Shaw, 68 Ill.2d 342, 369 N.E.2d 884, 12 Ill.Dec. 177 (1977). Lack of physical contiguity prevented consideration of damage to the remainder in City of Quincy v. V.E. Best Plumbing & Heating Supply Co., 17 Ill.2d 570, 162 N.E.2d 373 (1959). The City of Quincy acquired a lumberyard, and the owner filed a cross-petition alleging that because of the unity of use, the owner’s mill, located three blocks from the lumberyard, would be damaged. Even though the Supreme Court stated the operations on the two properties were an integral part of one unified business and the use of the lumberyard was beneficial to the use of the mill, since the owner failed to prove no other site was available to reestablish the lumberyard, it could not claim damage to the mill. On the other hand, the appellate court held lack of physical contiguity does not, by itself, bar consideration of several parcels as the whole property if other factors establish a unity of use. Pedigo, supra. An owner cannot avoid these restrictions by artificially designating a parcel’s boundaries (County of Cook v. LaSalle National Bank, 1 Ill.App.3d 579, 274 N.E.2d 919 (1st Dist. 1971)), nor can the condemnor claim a lack of physical contiguity as a result of previous eminent domain acquisitions that run through the middle of the property (Chicago & Pac. R.R. v. Hildebrand, 136 Ill. 467, 27 N.E. 69 (1891)). If there is complete identity of the beneficial ownership of separate land trusts that own adjacent properties, a claim for damage may be presented. Franzen, supra. Unity of use, contiguity, and title need not occur on the date of filing the petition to condemn to claim damage to the remainder, according to the rule in State of Illinois Medical Center Commission v. United Church of Medical Center, 142 Ill.App.3d 498, 491 N.E.2d 1327, 96 Ill.Dec. 867 (1st Dist. 1986). The Medical Center Commission condemned three contiguous lots used by the defendant as a parking lot for its employees and for parishioners who attended the church located immediately adjacent to the three lots. At the time of filing the eminent domain action, however, the parking lots were owned by a predecessor Methodist congregation, and, later, title passed to a Presbyterian church. Not until after the complaint had been filed did the defendant obtain formal legal title to the condemned property. Nevertheless, the appellate court held the defendant was entitled to file a cross-petition claiming damage to the remainder as a result of the condemnation. The court noted no statute or previous Illinois case had discussed at what time in an eminent domain proceeding the unity of title or interest in property taken or damaged is to be determined. Apparently, the elements of contiguity, common use, control over the property at the date of filing, and eventual passage of title after the date of filing overcame the initial lack of title.



Thirteen years later, the First District Appellate Court qualified its prior decision in United Church of Medical Center when it held unity of title must be determined as of the time the complaint was filed. Department of Transportation v. Chicago Title & Trust Co., 303 Ill.App.3d 484, 707 N.E.2d 637, 236 Ill.Dec. 510 (1st Dist. 1999). The court specifically held:

Logically, the unity of title in a remainder case should be determined by examining who the owner of the property was at the time the petition to condemn was filed, because the valuation of the property is determined as of the date the complaint for condemnation is filed. 707 N.E.2d at 646.

This approach provides more certainty to the outcome. More recently, the appellate court drew back somewhat from an emphasis on assessing the actual conditions on the valuation date in Pedigo, supra. The court determined there was sufficient unity of use between parcels even though the condition that gave rise to that unity apparently was not present on the valuation date. In an opinion that would be much easier to understand if the appellate court had attached a plat of the property at issue, the unity of use was based on the potential use of the property to serve as an access point for obtaining water from a lake to service the sod farm located on the other parcels in drought conditions, even though a drought had not occurred for many years. Tenants may also claim damages under certain circumstances. In Chicago & Evanston R.R. v. Dresel, 110 Ill. 89 (1884), the plaintiff railroad condemned Dresel’s leasehold interest in four lots that were owned by the railroad. After the taking, Dresel continued to lease adjacent lots and to own lots adjacent to the leased lots, all of which he used to operate a flower garden. Based on this unity of use, the Supreme Court held Dresel could claim damage arising from the taking of his leasehold rights and thus could show the extent to which his remaining leasehold interest and his fee interest were damaged. The lessee did not do as well in City of Lake Forest v. First National Bank of Lake Forest, 52 Ill.App.3d 893, 368 N.E.2d 156, 10 Ill.Dec. 670 (2d Dist. 1977), in which the tenant canceled his lease to the parking lot to be acquired at the time of condemnation and could not prove that the lot condemned and the lot owned in fee were so interrelated as to warrant their consideration as a single parcel. Similarly, lack of unity of title prevented the owners of a farm that was partially taken from claiming damage to the adjoining farm they did not own but merely leased. They were, of course, permitted to claim damage to the remaining property they did own. Department of Transportation of State of Illinois ex rel. People v. Gass, 165 Ill.App.3d 562, 519 N.E.2d 90, 116 Ill.Dec. 500 (5th Dist. 1988). Single parcel status was also denied to a property that was under option to the owner of the adjacent parcel in City of Chicago ex rel. Schools v. Albert J. Schorsch Realty Co., 127 Ill.App.2d 51, 261 N.E.2d 711 (1st Dist. 1970). F. [7.45] Proper Elements of Damages Since the measure of damages for land not taken is the difference between the fair cash market value of the remainder before the taking and the fair cash market value of the remainder



after the taking, any claim for damages must be related to the depreciation in the market value of the remainder. Thus, the alleged damages must directly affect the market value and cannot be merely possible or speculative. Department of Public Works & Buildings v. Hubbard, 363 Ill. 99, 1 N.E.2d 383 (1936); County Board of School Trustees of Ogle County v. Elliott, 14 Ill.2d 440, 152 N.E.2d 873 (1958). As in any other contested proceeding, the party who alleges a specific element of damage must not only relate that element in theory to the market value of the remainder but also must prove that the element actually exists. A good example of the standard of proof required is found in Hubbard, supra. The Department of Public Works and Buildings sought to acquire property running through the defendant’s farmland to construct a new highway. At the trial, the defendant alleged damage to the remaining property, which would be split by the highway, due to the danger of crossing the road and the inconvenience of driving livestock from one field to another. In assessing this claim, the Supreme Court stated that generally a claim for damage due to the danger in crossing a highway was too remote and speculative. However,

where there is specific evidence of danger of loss by killing livestock or inconvenience and expense in herding them across the highway, and where such danger or inconvenience in fact depreciates the value of land not taken, such become a proper element to be considered in determining the damage to land not taken. 1 N.E.2d at 385.

See also Department of Public Works & Buildings v. Caldwell, 301 Ill. 242, 133 N.E. 642 (1921), and Department of Public Works & Buildings v. McBride, 338 Ill. 347, 170 N.E. 295 (1930), in which the Supreme Court held the element of crossing the highway was improper in the first case and proper in the second. Another example of the required standard of proof appears in Department of Public Works & Buildings of State of Illinois ex rel. People v. Bills, 66 Ill.App.2d 170, 213 N.E.2d 110 (3d Dist. 1965), in which the appellate court said an owner could not claim damage to the remainder for resulting surface drainage problems if the owner did not offer proof that the drainage problems would occur. Application of the market value standard means that certain elements may, in one situation, properly form the basis for a claim of damage and, in another situation, not form the basis for a claim. For example, taking a 10-foot strip from the frontage of a lot may cause damage to the remainder if the remaining lot is only 100-feet deep and is improved with a fast-food restaurant, while taking the same strip may not cause damage to the remainder if the remaining lot is 400 feet deep and vacant. The location of the property, its use, and even the engineering standards governing the public project may also determine whether certain damage claims are proper. In Trunkline Gas Co. v. O’Bryan, 21 Ill.2d 95, 171 N.E.2d 45 (1960), the plaintiff acquired an easement across the owner’s farm to install a gas pipeline. At trial, the owner claimed damage to the remainder due to the danger of fire and explosion if a leak from the gas pipeline should occur. The trial court excluded the testimony of those witnesses who based their opinions on the danger of fire and explosion. Affirming the trial court, the Supreme Court noted that this element of damage would



be proper if the pipeline had been located near buildings or residences or if the remaining property had a highest and best use for factory or residential purposes. However, since a pipeline running through farmland represents no proximity to real danger, the alleged element of fear of fire and explosion was too speculative in this particular situation. The Supreme Court also refused to accept the owner’s analogy to 19th- and early 20th-century railroad rights-of-way cases in which the danger of fire from passing trains was considered a proper element of damage. The court noted the engineering and technology of the 19th- and early 20th-century trains were such that fires arising from the emission of sparks from the locomotives were common occurrences and distinguished that situation from the modern engineering of a gas pipeline that presents little likelihood of frequent explosions. In addition to requiring damage claims be related to market value and actually proven, the courts also impose two additional requirements. The first is that the claim for damages be consistent with the condemnor’s proposed use of the part taken and proposed stipulations. The Supreme Court in O’Bryan held the owners could not allege damage based on the possibility the pipeline would interfere with future tiling and drainage when the condemnor had agreed to restore all drain tile to its precondemnation condition. It is improper to base damages on allegations of what would occur that are contrary to the condemnor’s binding statement. The second additional requirement stems from the principle that compensation must be fair to both the public body and the owner. This requirement prohibits duplication of compensation by including the same elements in determining the value of the part taken as are used in determining the damage to the remainder. Peoria, B. & C. Traction Co. v. Vance, 234 Ill. 36, 84 N.E. 607 (1908); Department of Transportation of State of Illinois ex rel. People v. Bouy, 69 Ill.App.3d 29, 386 N.E.2d 1163, 25 Ill.Dec. 499 (4th Dist. 1979). Due to the application of the market standard to damage claims, the suggested technique for introducing evidence of damage to the remainder is to have the valuation witness testify according to the following guidelines: 1. State the opinion of the market value of the whole property, e.g., $100,000. 2. State the opinion of the market value of the part taken as a part of the whole property, e.g., $15,000. 3. State the market value of the remainder as part of the whole property before the acquisition (merely an artificial mathematical result reached by subtracting the value of the part taken from the value of the whole property), e.g., $85,000. 4. State the elements of damage to the remainder and give an explanation of each element. 5. State an opinion of the market value of the remainder after the taking and as affected by construction of the contemplated improvement, e.g., $55,000. 6. The difference between the market value of the remainder before and the market value of the remainder after is the amount of damage to the remainder, e.g., $85,000 – $55,000 = $30,000.



These general requirements are imposed on any claim of damage. However, there are as many potential elements of damage as there are types of properties. While it would unduly lengthen this chapter to review each decision that has considered damage to the remainder, certain situations occur with such frequency or are so frequently misunderstood as to warrant the short review in §§7.46 – 7.50 below. 1. [7.46] Cost To Cure After a partial taking, an owner frequently must adapt the remaining property to the changed conditions caused by the acquisition. For example, if the part taken includes paved parking spaces, the owner may have to replace the lost spaces by constructing a new parking area on the remaining property. The cost of replacing the lost spaces is known in the appraisal profession as the “cost to cure.” Cost to cure items may include relocation costs, as in the parking lot example, or reconstruction costs when the part taken includes a portion of the building. These costs are treated in the same fashion as any other element of damage to the remainder. If they are reasonable and economical, expenditures made in adapting the remainder to use after the taking are admissible as evidence of the depreciation in value of the remainder but they are not recoverable items in themselves. Department of Public Works & Buildings v. Bloomer, 28 Ill.2d 267, 191 N.E.2d 245 (1963). The modern approach to costs to cure can be summarized:

The rule in Illinois for determining the diminution in market value of land not taken allows consideration of expenses made necessary by reason of the improvement in adjusting the property to the changed conditions brought about by the taking. Such costs cannot be recovered specifically and are not the measure of damages but are factors that can be considered in determining a reduction of the market value of the whole. City of Freeport, Illinois v. Fullerton Lumber Co., 98 Ill.App.3d 218, 423 N.E.2d 924, 928, 53 Ill.Dec. 255 (2d Dist. 1981).

Since costs to cure must meet the same tests as other elements of damage, they cannot be too speculative. Thus, in Department of Transportation v. Quincy Coach House, Inc., 64 Ill.2d 350, 356 N.E.2d 13, 1 Ill.Dec. 13 (1976), the Illinois Department of Transportation’s valuation witnesses, faced with an acquisition that included a substantial portion of a restaurant’s parking lot, employed a cost to cure approach that depended on obtaining replacement parking. However, the cost of replacement parking did not involve repaving a portion of the available remaining property; instead, the appraisers assumed that a lot across the street could be purchased for 125 percent of its appraised value, and they used this cost as a means of arriving at an opinion of the depreciation of the remainder. While agreeing that an owner has a duty to mitigate damages, the Supreme Court held there was no guarantee the owner could buy the lot for the assumed price, and therefore, the cost to cure was too speculative. Other states have also barred elements of cost to cure when the cure involved going outside the remainder property. Board of Lucas County Commissioners v. Mockensturm, 119 Ohio App.3d 223, 695 N.E.2d 15 (1997). Nor can costs to cure be used as guises for introducing a replacement theory of value. City of Chicago v. Cunnea, 329 Ill. 288, 160 N.E. 559 (1928). Since the costs can be used only to determine depreciation in value of the remaining property, the amount of costs cannot exceed the



value of the remainder. Department of Transportation of State of Illinois v. Gonterman, 41 Ill.App.3d 62, 354 N.E.2d 76 (5th Dist. 1976). If the cost of reconstruction or mitigation of damages is higher than the expert’s highest opinion of the diminution in market value of the remainder, the court cannot allow these costs in evidence. This becomes particularly troublesome when the taking involves a portion of a building. In these cases, the jury must determine whether the remainder building has any value. If it does not, or if the reconstruction costs are excessive, then the owner should receive the value of the entire property plus the cost of removing the remaining portion of the building less the value of the remainder after the building has been removed. If the jury determines the remaining building may be rehabilitated according to a feasible plan, and if such rehabilitation will minimize the damage to the remainder, then the jury may consider the reconstruction costs in determining damages to the remainder. City of Chicago v. Callender, 396 Ill. 371, 71 N.E.2d 643 (1947). See also Department of Public Works & Buildings v. McBride, 338 Ill. 347, 170 N.E. 295 (1930). These costs must not only be economically reasonable but must also relate to the market value of the remainder. A valuation witness cannot merely total the various costs and use that as his or her opinion of damage. In Department of Transportation of State of Illinois ex rel. People v. Jones, 44 Ill.App.3d 592, 358 N.E.2d 402, 405 – 406, 3 Ill.Dec. 235 (5th Dist. 1976), the court stated: “Where it appears that an expert witness has based his valuation solely on specific elements of damage without regard to what a willing buyer or seller would agree upon, that testimony is improper and should be stricken.” See also Department of Public Works & Buildings v. Caldwell, 301 Ill. 242, 133 N.E. 642 (1921); Department of Transportation v. Bolis, 313 Ill.App.3d 982, 730 N.E.2d 1152, 246 Ill.Dec. 687 (3d Dist. 2000); Rock River Water Reclamation District v. Sanctuary Condominiums of Rock Cut, 2014 IL App (2d) 130813, 30 N.E.3d 1081, 391 Ill.Dec. 443. Costs must also be related solely to the changed conditions caused by the taking; they cannot include items that affected the property before the acquisition. For example, in Department of Public Works & Buildings v. Hubbard, 363 Ill. 99, 1 N.E.2d 383 (1936), the owner’s damage claim included the costs of constructing and maintaining new fences after a new road was built across part of his property. Observing that the cost of additional fencing made necessary by the improvement was a proper element of damage, the Supreme Court went on to note that if the owner had originally been required to maintain a fence that was acquired in the part taken, then “he is entitled to have considered as an element of damages to land not taken the cost and maintenance of only such additional fence beyond the amount originally required of him as is necessitated by the improvement.” 1 N.E.2d at 385. When actually presenting cost to cure evidence, the following should be kept in mind: a. A witness may introduce plans to reconstruct or adapt the property after the acquisition. Fullerton Lumber, supra. b. A witness may not introduce letters from contractors estimating various costs if the authors are not present in court. Department of Public Works & Buildings v. Maddox, 21 Ill.2d 489, 173 N.E.2d 448 (1961). Query whether this decision remains valid in the face of Ill.R.Evid.



705, Department of Transportation v. Beeson, 137 Ill.App.3d 908, 485 N.E.2d 511, 92 Ill.Dec. 700 (2d Dist. 1985), and City of Chicago v. Anthony, 136 Ill.2d 169, 554 N.E.2d 1381, 144 Ill.Dec. 93 (1990). c. A witness may testify in line with the testimony of IDOT’s witness in Bloomer, supra, in which the appraiser 1. appraised the entire property; 2. determined the value of the part taken; 3. determined the value of the remainder before the taking; 4. gave an opinion of the reduction in value of the remainder caused by the acquisition;

and 5. described each of the factors contributing to the reduction in value of the remainder

as “He testified that the factors causing this reduction were . . . the necessity for additional fencing, which reduced the land value by its reasonable cost of $1,800.” 191 N.E.2d at 248.

This approach contrasts with the mere effort to collect specific amounts by itemizing claimed elements of damage, which was disapproved in Department of Transportation of State of Illinois v. Galley, 12 Ill.App.3d 1072, 299 N.E.2d 810 (5th Dist. 1973). The strict disclosure requirements imposed by S.Ct. Rule 213 require the appraiser to correctly use cost to cure items during discovery. In Department of Transportation, State of Illinois v. Crull, 294 Ill.App.3d 531, 690 N.E.2d 143, 228 Ill.Dec. 834 (4th Dist. 1998), the appellate court reversed the trial court for permitting an appraiser on the witness stand to reformulate his opinion to delete his improper use of the cost to cure approach. Because his reformulated opinion had not been disclosed during discovery, the trial court should have struck the appraiser’s opinion. In summary, there is no outright ban on the use of costs to cure in assessing damage to the remainder. The ban that has been enforced is a ban against the practice of itemizing these costs and attempting to collect specific amounts when no effort has been made to relate them to the market value of the remainder. 2. [7.47] Reduction in Size One of the most common elements of damage is the claim that the taking will reduce the size of the property and therefore will make development or use of the remainder more difficult. County Board of School Trustees of Ogle County v. Elliott, 14 Ill.2d 440, 152 N.E.2d 873 (1958); Lake County Forest Preserve District v. Flood, 51 Ill.App.3d 32, 366 N.E.2d 1044, 9 Ill.Dec. 533 (2d Dist. 1977). However, unlike antitrust law, which features per se violations, there are no per se damage elements in eminent domain law. As proof of this, the appellate court in Department of Business & Economic Development of State of Illinois v. Brummel, 1 Ill.App.3d 683, 274 N.E.2d



605 (2d Dist. 1971), rev’d on other grounds, 52 Ill.2d 538 (1972), held that the trial court properly struck the testimony of an appraiser whose opinion of damage was based on the reduction in size of the remainder when the part taken was used for an entirely different purpose than the remainder and was separated from the remainder by a 25-foot easement for railroad tracks. The lesson is clear: each element of damage must be proven to have a direct effect on the remainder. 3. [7.48] Noise In many old cases, the courts refused to acknowledge allegations of increased noise from the improvement to be a proper element of damage. The courts reasoned this claim was too speculative. However, two cases feature damage claims based on allegations of increased noise. Department of Transportation ex rel. People v. Catholic Diocese of Belleville, 63 Ill.App.3d 683, 379 N.E.2d 1343, 20 Ill.Dec. 275 (5th Dist. 1978), contains a good review of the type of evidence that might be presented in a dispute over whether noise from a road-widening will adversely affect the remainder, in this case, a school. Even more interesting is the appellate court’s decision in Iowa-Illinois Gas & Electric Co. v. Hoffman, 127 Ill.App.3d 496, 468 N.E.2d 977, 82 Ill.Dec. 323 (3d Dist. 1984), which upheld admitting evidence that noise from electric transmission lines would likely create stress to the hogs on the remaining farm property and thus be a proper element of damage. 4. [7.49] Unsightliness Whether the unsightliness of the proposed improvement is a proper element of damage to the remainder has long been and continues to be a source of controversy within the Illinois courts. The history of the various approaches taken to this issue demonstrates the difficulty found in construing the meaning of the term “or damaged” in the Illinois Constitution. See ILL.CONST. art. I, §15. Most of these cases arose when a utility company condemned an easement for a new power line and the owners claimed the unsightliness of the proposed power poles would damage the remainder. In dicta in Board of Trade Tel. Co. v. Darst, 192 Ill. 47, 61 N.E. 398 (1901), the Supreme Court indicated that unsightliness of power poles was a proper element of damage to the remainder. Shortly thereafter, in Sanitary District of Chicago v. Baumbach, 270 Ill. 128, 110 N.E. 331 (1915), the Supreme Court recognized a claim of damage for unsightliness due to construction of high and unsightly spoil banks adjacent to property that could be subdivided for residence or business purposes. However, in 1926, 25 years after Darst, supra, the Supreme Court held an appraiser could not base a claim for damage to the remainder on the unsightliness of the proposed power poles. Illinois Power & Light Corp. v. Peterson, 322 Ill. 342, 153 N.E. 577 (1926). The Peterson court believed this element was too speculative but did not mention Darst. One year later, the Supreme Court specifically rejected the dicta in Darst and, citing Peterson, held the unsightliness of the poles was not a proper element of damage. Illinois Power Co. v. Wieland, 324 Ill. 411, 155 N.E. 272 (1927). Citing Wieland, the Supreme Court reaffirmed its rejection of valuation opinions that include unsightliness elements in Central Illinois Light Co. v. Nierstheimer, 26 Ill.2d 136, 185 N.E.2d 841 (1962).



Fifteen years after Nierstheimer, the Supreme Court resurrected Darst, supra; referred to Baumbach, supra; did not refer to Peterson, supra, Wieland, supra, or Nierstheimer; and held that the trial court should have admitted evidence of unsightliness of the proposed power structures and transmission lines. Central Illinois Public Service Co. v. Westervelt, 67 Ill.2d 207, 367 N.E.2d 661, 10 Ill.Dec. 208 (1977). In Westervelt, the power lines would be constructed next to the property having a highest and best use of residential homesites. Justice Clark, writing for the court, stated: “If the construction on the easement strip is aesthetically distasteful or unsightly to potential buyers, the market value of the land is thereby reduced.” 367 N.E.2d at 663. When the same issue of unsightliness of power structures and transmission lines confronted the Second District five years later in Commonwealth Edison Co. v. Danekas, 104 Ill.App.3d 907, 433 N.E.2d 736, 741, 60 Ill.Dec. 694 (2d Dist. 1982), the appellate court called Westervelt, supra, a “narrow exception” to the general rule of excluding evidence of unsightliness, refused to apply the Supreme Court’s reasoning to property that was not residential, and held that the trial court had properly excluded evidence of unsightliness of towers located next to farmland. This restrictive reading of Westervelt was rejected by the Third District in Iowa-Illinois Gas & Electric Co. v. Hoffman, 127 Ill.App.3d 496, 468 N.E.2d 977, 82 Ill.Dec. 323 (3d Dist. 1984). Specifically disagreeing with Danekas, supra, the Third District held evidence of unsightliness, as long as it was related to market value, could be admitted regardless of whether the remaining property was residential, commercial, or agricultural. 5. [7.50] Access The condemnor’s acquisition and improvement often cause changes in the access to the remainder or the traffic flow past the remainder. Whether these changes give rise to compensable elements of damage to the remainder has been frequently litigated. Because private property rights do not include value attributable to government-related activity, the government should not be required to compensate an owner for elements of value that the government created and that the government can take away. United States v. Fuller, 409 U.S. 488, 35 L.Ed.2d 16, 93 S.Ct. 801 (1973). Thus, the government should not be required to compensate an owner for any diminished property value caused by the exercise of the police power. Since the police power includes such activities as traffic control, it then follows that an individual has no property right in the flow of traffic past his or her property, and, therefore, a modification of that flow is a valid exercise of the police power and does not result in compensable damages. For these reasons, the Supreme Court in Department of Public Works & Buildings v. Mabee, 22 Ill.2d 202, 174 N.E.2d 801 (1961), held that diminution in value of the remainder caused by the installation of a barrier median in the center of the street, which created one-way traffic and diverted the flow of traffic in front of the remainder, was a result of an exercise of the police power and therefore was not a compensable damaging. It is important to realize that the reduction in market value of the remainder in Mabee was very real — the property was a gasoline service station. The key is that the reduction was caused by the police power, not the acquisition of the part taken.



When a partial taking changes access to the remainder, the consequent reduction in value of the remainder may be compensable. In a case involving the acquisition of a corner of a gasoline service station and the resulting relocation of driveways, the appellate court upheld introducing evidence of the decrease in gasoline sold after the relocation of driveways as relevant to proving difficulty of access to and consequent depreciation in value of the remainder. Department of Transportation v. Shell Oil Co., 156 Ill.App.3d 304, 509 N.E.2d 596, 108 Ill.Dec. 900 (1st Dist. 1987). On the other hand, by invoking the police power principle, the courts have held that an owner is not entitled to damages for increased traffic flow past the property (Department of Transportation of State of Illinois v. Reckamp, 9 Ill.App.3d 117, 291 N.E.2d 868 (5th Dist. 1973)) or for decreased traffic flow past the property caused by the improvement (Department of Public Works & Buildings of State of Illinois ex rel. People v. Greenwell, 45 Ill.App.3d 159, 359 N.E.2d 780, 3 Ill.Dec. 921 (5th Dist. 1977)). See also Department of Public Works & Buildings of State of Illinois ex rel. People v. Bills, 66 Ill.App.2d 170, 213 N.E.2d 110 (3d Dist. 1965). The Greenwell court also refused compensation for alleged damage due to closing the road near the remainder and diverting traffic to a new road north of the remainder. As long as the government’s traffic restrictions are reasonable, depreciation caused by these restrictions is not compensable. Ryan v. Rosenstone, 20 Ill.2d 79, 169 N.E.2d 360 (1960). Cases discussing traffic flow gave rise to the principle that mere circuity of travel to and from the remainder is not compensable. Streeter v. County of Winnebago, 85 Ill.App.3d 116, 404 N.E.2d 451, 39 Ill.Dec. 67 (2d Dist. 1980). However, a private property owner has a right of access from his or her property to an adjacent street. Section 4-210 of the Illinois Highway Code recognizes an owner’s right of ingress and egress to and from abutting state highways, subject to reasonable restrictions. 605 ILCS 5/4-210. This right of access is a valuable property right that cannot be taken without compensation. Department of Public Works & Buildings v. Wolf, 414 Ill. 386, 111 N.E.2d 322 (1953). There is then a question as to when the changes caused by the public improvement result in mere circuity of travel and when they result in deprivation of the right of access. The Supreme Court confronted this precise issue in Department of Public Works & Buildings v. Wilson & Co., 62 Ill.2d 131, 340 N.E.2d 12, 17 (1975). In an important decision, the court held that while not every limitation of access is compensable, when “access is taken or materially impaired,” the condemnor must compensate the property owner. Id. In this case, the complete elimination of all direct access by the substitution of a frontage road was held to be a material impairment of access. As a result, the jury could consider whether the substituted frontage road equaled the original access and whether the remaining property was damaged. Wilson noted the trial court should make an initial determination of whether there has been an actionable taking or impairment of access rights as a matter of law. Presumably, this would be similar to a reasonable probability of rezoning hearing. Should the trial court determine there is merely a reasonable limitation on access under the police power, the owner cannot present evidence of damage due to the exercise of the police power. Should the trial court determine there is an impairment or taking, the owner is entitled to seek damages before the jury based on the impairment or taking of access. But even if the trial court determines that access rights have been



taken or materially impaired, the jury still has the ultimate duty to decide whether the taking or impairment caused any damage. Department of Transportation of State of Illinois ex rel. People v. Gass, 165 Ill.App.3d 562, 519 N.E.2d 90, 116 Ill.Dec. 500 (5th Dist. 1988). A jury could decide the substitute access is as good as the original and award no damages. Department of Public Works & Buildings of State of Illinois ex rel. People v. Sun Oil Co., 66 Ill.App.3d 64, 383 N.E.2d 634, 22 Ill.Dec. 826 (5th Dist. 1978). In Department of Transportation, State of Illinois v. Lowderman, LLC, 367 Ill.App.3d 502, 854 N.E.2d 261, 304 Ill.Dec. 919 (3d Dist. 2006), the appellate court drew a distinction between a taking of all access rights to an adjacent road and a taking of only direct access rights to an adjacent road. In the former case, the owner of the remainder simply has a license to use a frontage road and may claim that he or she is left without any rights of access. In the latter case, the owner has a right to use a frontage road and may not claim total loss of access. The owner, however, can still claim damage based on circuity of travel. If the trial court determines that access rights have been taken or materially impaired, the trial court should refrain from giving a special, access jury instruction. In Illinois State Toll Highway Authority v. Dicke, 208 Ill.App.3d 158, 566 N.E.2d 1003, 153 Ill.Dec. 153 (2d Dist. 1991), the appellate court acknowledged the trial court’s non-I.P.I. instruction concerning loss of access was an accurate statement of the law. But the appellate court held that giving the instruction was error since it unduly highlighted one element of damage. The decision of whether the improvement results in a reasonable restriction of access under the police power or a material impairment and taking can be quite close. Department of Transportation of State of Illinois ex rel. People v. Rasmussen, 108 Ill.App.3d 615, 439 N.E.2d 48, 64 Ill.Dec. 119 (2d Dist. 1982). If the owner had previously given up access rights, even if the condemnor did not actually take access at the time it acquired the rights, the owner cannot claim damage for the loss of the same rights in a subsequent condemnation case. Department of Transportation v. Western National Bank of Cicero, 63 Ill.2d 179, 347 N.E.2d 161 (1976). Conversely, the condemnor cannot attempt to acquire different access rights than it originally took without payment of additional compensation. Department of Public Works & Buildings of State of Illinois ex rel. People v. Mokres, 28 Ill.App.3d 422, 328 N.E.2d 357 (4th Dist. 1974). Finally, counsel for both the condemnor and the landowner should ascertain whether the circuit court has subject-matter jurisdiction to entertain a claim against the state for access impairment. In Department of Transportation ex rel. People v. Interstate Brands Corp., 251 Ill.App.3d 785, 623 N.E.2d 771, 191 Ill.Dec. 181 (4th Dist. 1993), an unusual case, the appellate court upheld dismissal of a counterclaim based on alleged damages due to the moving of a driveway. The condemnation case involved acquisition of a temporary easement, but apparently the Illinois Department of Transportation’s relocation of the access driveway was unrelated to the temporary easement. Holding that the counterclaim did not seek damages resulting from the temporary easement, the appellate court classified the access damage claim as a direct damage claim against the state. As a result, the claim could be pursued only in the Court of Claims. See 705 ILCS 505/8.



G. [7.51] Improper Elements of Damage Although the Illinois courts have adopted the market value standard in assessing damage to the remainder, for public policy reasons certain elements that may adversely affect market value are nevertheless held to be non-compensable. These reasons were originally noted in Rigney v. City of Chicago, 102 Ill. 64, 80 (1881), when the Supreme Court observed that certain injuries “are necessarily incident to the ownership of property” and labeled them “damnum absque injuria.” These injuries are suffered in common by all people in the neighborhood, do not constitute “a special damage with respect to . . . property in excess of that sustained by the public generally,” and are therefore non-compensable. 102 Ill. at 81. Rigney used, as an example, depreciation caused by building a jail in the neighborhood. Other courts have refused to allow damages attributed to constructing a smallpox hospital (Frazer v. City of Chicago, 186 Ill. 480, 57 N.E. 1055 (1900)), building a cemetery (City of Winchester v. Ring, 312 Ill. 544, 144 N.E. 333 (1924)), or constructing a school playground (Schuler v. Wilson, 322 Ill. 503, 153 N.E. 737 (1926)). As discussed in §7.50 above, reduction in market value due to the exercise of the police power is not compensated for public policy reasons. One way to analyze the police power exception is to remember Blackstone’s observation that the eminent domain power substitutes the sovereign itself in place of the owner, thus granting the sovereign the owner’s rights in the res and requiring the sovereign to pay for those rights. 1 William Blackstone, COMMENTARIES ON THE LAWS OF ENGLAND, p. 135 (1979). Therefore, if the owner had rights that are taken, the sovereign must pay. However, if what is done is not subject to private ownership rights, as in the case of actions taken under the police power, then the sovereign need not pay because it is not succeeding to anything the owner had in the first place. Among the actions placed in the police power category are 1. median strips (see Department of Public Works & Buildings v. Mabee, 22 Ill.2d 202, 174

N.E.2d 801 (1961)); 2. traffic diversion (see City of Chicago v. Spoor, 190 Ill. 340, 60 N.E. 540 (1901)); 3. circuitous travel (see Department of Public Works & Buildings of State of Illinois ex rel.

People v. Greenwell, 45 Ill.App.3d 159, 359 N.E.2d 780, 3 Ill.Dec. 921 (5th Dist. 1977)); 4. driveway regulation (see City of Elmhurst v. Buettgen, 394 Ill. 248, 68 N.E.2d 278

(1946)); and 5. increase or decrease in traffic flow past property (see Village of Round Lake v. Amann,

311 Ill.App.3d 705, 725 N.E.2d 35, 244 Ill.Dec. 240 (2d Dist. 2000)). Unfortunately, the extent of the police power is not well defined. In deciding whether the application of New York City’s Landmarks Preservation Law to the Grand Central Terminal constituted a taking or a police power restriction, the United States Supreme Court acknowledged that “this Court, quite simply, has been unable to develop any ‘set formula’ for determining when ‘justice and fairness’ require that economic injuries caused by public action be compensated by



the government, rather than remain disproportionately concentrated on a few persons.” Penn Central Transportation Co. v. City of New York, 438 U.S. 104, 57 L.Ed.2d 631, 98 S.Ct. 2646, 2659 (1978). Public policy additionally precludes consideration of damage dependent on an illegal use of the property. Department of Public Works & Buildings v. Hubbard, 363 Ill. 99, 1 N.E.2d 383 (1936). Consistent with this policy is §10-5-50 of the Eminent Domain Act, which expressly permits the introduction of evidence of “any unsafe, unsanitary, substandard, or other illegal condition, use, or occupancy of the property.” 735 ILCS 30/10-5-50. The appellate court restricted the scope of this statute to an illegal condition on the part taken or remainder in Illinois State Toll Highway Authority v. West Suburban Bank, 208 Ill.App.3d 923, 567 N.E.2d 730, 153 Ill.Dec. 772 (2d Dist. 1991). Certain other elements may not be used as the basis for a damage claim because they are not relevant to market value. Loss of goodwill (City of Quincy v. V.E. Best Plumbing & Heating Supply Co., 17 Ill.2d 570, 162 N.E.2d 373 (1959)) and loss of business during construction (Department of Public Works & Buildings v. Maddox, 21 Ill.2d 489, 173 N.E.2d 448 (1961)) fall into this category. Similarly, in City of Chicago v. Provus, 415 Ill. 618, 114 N.E.2d 793 (1953), the Supreme Court refused to recognize a damage claim for loss of an appraisal fee with a proposed loan to develop the property, for loss of the use of an architect’s plans for developing the site, and for mortgage service charges. The court reasoned the market value standard does not take into consideration as a measure of damages any peculiar value to the owner because of a contemplated use. For the same reason, loss or frustration of business opportunity is non-compensable. United States ex rel. Tennessee Valley Authority v. Powelson, 319 U.S. 266, 87 L.Ed. 1390, 63 S.Ct. 1047 (1943). Moving expenses are also non-compensable in a condemnation case. Housing Authority of City of East St. Louis v. Kosydor, 17 Ill.2d 602, 162 N.E.2d 357 (1959). Note that the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970, in the case of certain federally funded projects, the relocation costs provision in 735 ILCS 30/10-5-62, and 50 ILCS 20/14.2, in the case of acquisitions by a public building commission, afford outside payment of moving expenses. The final category of improper elements includes claims that are too speculative to assist the jury in deciding whether the remainder has been damaged. In Illinois Power & Light Corp. v. Peterson, 322 Ill. 342, 153 N.E. 577, 579 (1926), the Supreme Court reversed the trial court for admitting evidence of possible trespasses by the condemnor’s employees and the like by stating:

The other elements of damage detailed by the witnesses involve no physical disturbance of a right of property, but are so remote, speculative, and uncertain as to afford no basis for the allowance of damages. If damage should result from the opening of a fence to reach the tower site or from some trespass by appellant’s employees, appellee will have his remedy. Damage from such sources may never occur and cannot be anticipated in a condemnation proceeding. Since damages are recoverable only where there is a physical disturbance of a right of property, the fear of a remote and contingent injury which may possibly occur, but the happening of which is altogether speculative and uncertain, is not regarded by the law as an



element entering into the damages which may be allowed to the owner. The damage must be direct and proximate and not such as is merely possible or may be conceived by the imagination.

Other examples of speculative claims are 1. fear of injury from high-tension wires (see East St. Louis Light & Power Co. v. Cohen,

333 Ill. 218, 164 N.E. 182 (1928)); and 2. possible danger to persons crossing the proposed road (see Department of Public Works

& Buildings v. Griffin, 305 Ill. 585, 137 N.E. 523 (1922); Department of Public Works & Buildings v. Caldwell, 301 Ill. 242, 133 N.E. 642 (1921)).

Finally, to be compensable, damages must be the direct and proximate result of the taking. Department of Transportation of State of Illinois ex rel. People v. Lake Ka-Ho, Inc., 98 Ill.App.3d 1052, 425 N.E.2d 50, 54 Ill.Dec. 538 (4th Dist. 1981); Department of Public Works & Buildings of State of Illinois v. Horejs, 78 Ill.App.2d 284, 223 N.E.2d 207 (1st Dist. 1966). The appellate court rejected a claim for damages based on the placement of fill on adjoining property and consequent drainage problems on the remainder of the subject property. Illinois State Toll Highway Authority v. Dicke, 208 Ill.App.3d 158, 566 N.E.2d 1003, 153 Ill.Dec. 153 (2d Dist. 1991). While the condemnor’s contractor had placed fill on the adjoining property, the condemnor had not been aware of it, the placement of fill was not part of the tollway’s design, and the taking of a portion of the subject property was not directly linked to the placement of fill. The appellate court held that the alleged damage was not recognizable in the eminent domain proceeding. It directed the owner to the Court of Claims for any possible remedy. The owner was also relegated to the Court of Claims to recover damages not arising out of the taking in Department of Transportation ex rel. People v. Interstate Brands Corp., 251 Ill.App.3d 785, 623 N.E.2d 771, 191 Ill.Dec. 181 (4th Dist. 1993). H. [7.52] Benefits Since the extent of damage to the remaining property is determined by the depreciation in its market value, if the public improvement on the part taken will benefit and enhance the market value of the remainder, this benefit may be considered. The common-law rule in Illinois is that benefits may be used to offset damages but may not be used to offset compensation due for the part taken. Metropolitan West Side El. Ry. v. Stickney, 150 Ill. 362, 37 N.E. 1098 (1894). Because benefits can be used only to offset damage to the remainder, the “before-and-after” formula referred to in City of Springfield, Illinois v. West Koke Mill Development Corp., 312 Ill.App.3d 900, 728 N.E.2d 781, 785, 245 Ill.Dec. 699 (4th Dist. 2000), must be viewed with caution. Stickney, supra, also acknowledged the distinction between general benefits, which are those benefits that cannot be used to offset damages, and special benefits, which are those benefits that can be used to offset damages. The court defined “general benefits” as “those general, intangible benefits which are suposed to flow to the general public from a public improvement” (37 N.E. at 1100), and then defined “special benefits”:



Special benefits are such benefits flowing from the proposed public work as appreciably enhance the value of the particular tract of land alleged to be benefited. . . . As already said, the fact that other property in the vicinity is likewise increased in value from the same cause — that is, also specially benefited by the improvement — furnishes no excuse for excluding the consideration of special benefits to the particular property, in determining whether it has been damaged or not, and, if it has, the extent of the depreciation in value. On the one hand, the damages must be real and substantial; on the other, the benefits must be such as affect the market value or use of the land, and such as are capable of measurement and computation. Hence, all imaginary and merely speculative damages or benefits are excluded from consideration. [Citations omitted.] 37 N.E. at 1103 – 1104.

Put in other terms, general benefits arise from the fulfillment of the public object that justified the taking, while special benefits arise from the peculiar relation of the land in question to the public improvement. United States v. 2,477.79 Acres of Land, More or Less, Situate in Bell County, Texas, 259 F.2d 23 (5th Cir. 1958). Section 10-5-55 of the Eminent Domain Act expressly recognizes special benefits by providing:

In assessing damages or compensation for any taking or property acquisition under this Act, due consideration shall be given to any special benefit that will result to the property owner from any public improvement to be erected on the property. 735 ILCS 30/10-5-55.

Section 10-5-50 gives a somewhat broader definition of “special benefits,” stating, in relevant part:

Evidence is admissible as to: (1) any benefit to the landowner that will result from the public improvement for which the eminent domain proceedings were instituted. 735 ILCS 30/10-5-50.

Special benefits, like any alleged element of damage, must affect the market value of the remainder. Objections based on speculation, conjecture, and remoteness are as applicable to benefit claims as to damage claims. However, the fact that the value of other property in the area will also be increased by the proposed improvement furnishes no basis for objecting to evidence of the benefit. Department of Public Works & Buildings v. Griffin, 305 Ill. 585, 137 N.E. 523 (1922). Special benefits have been recognized in the following situations: 1. increased traffic, increased advertising value, and increased accessibility in Cuneo v. City

of Chicago, 400 Ill. 545, 81 N.E.2d 451 (1948); 2. a widened street, replaced curbs and sidewalks, and increased accessibility in Department

of Public Works & Buildings of State of Illinois ex rel. People v. Todaro, 90 Ill.App.2d 245, 233 N.E.2d 61 (5th Dist. 1967);



3. increased exposure to public and improved access in Department of Public Works & Buildings of State of Illinois v. Klehm, 6 Ill.App.3d 752, 286 N.E.2d 558 (1st Dist. 1972); and

4. creation of a reasonable probability of rezoning to commercial use after the improvement

is completed in Department of Public Works & Buildings of State of Illinois v. Exchange National Bank, 31 Ill.App.3d 88, 334 N.E.2d 810 (2d Dist. 1975).

Despite the long line of benefits cases, the courts still struggle to distinguish general and special benefits. Three decisions from the Second District are evidence of this: Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 196 Ill.App.3d 5, 552 N.E.2d 1151, 142 Ill.Dec. 410 (2d Dist. 1990); Illinois State Toll Highway Authority v. Itasca Bank & Trust Co., 216 Ill.App.3d 926, 576 N.E.2d 1221, 160 Ill.Dec. 267 (2d Dist. 1991); Illinois State Toll Highway Authority v. American National Bank & Trust Company of Chicago, 236 Ill.App.3d 696, 606 N.E.2d 147, 179 Ill.Dec. 315 (2d Dist. 1992). In the appeal from the last of these, the Supreme Court reversed that part of the appellate court’s ruling on special benefits in a four-three decision. Illinois State Toll Highway Authority v. American National Bank & Trust Company of Chicago, 162 Ill.2d 181, 642 N.E.2d 1249, 1256, 205 Ill.Dec. 132 (1994). All these cases involved acquisitions arising out of construction of the North-South Tollway in DuPage County. In Heritage Standard, supra, the appellate court classified the benefits as special and therefore capable of offsetting damages, while in Itasca Bank & Trust, supra, and American National Bank, the appellate court classified the benefits as general and not capable of offsetting damages. As stated, the Supreme Court reversed the appellate court in American National Bank by reclassifying the benefits as special. The Heritage Standard acquisition consisted of 11.4 acres from a 40.5-acre parcel. The Illinois State Toll Highway Authority’s land planner testified that, as a result of the remainder being located adjacent to the North-South Tollway and close to the 75th Street interchange, the remainder’s highest and best use changed from residential to office. One of the ISTHA’s appraisers then testified that the proximity to the 75th Street interchange and the increased visibility and advertising exposure of the remainder constituted benefits the value of which offset any damage caused by the acquisition. Judge Dunn, writing for the appellate court, with the concurrence of Judges Reinhard and McLaren, held these benefits were special despite the fact that the interchange was not actually located on the property taken from the owner. The Itasca Bank & Trust acquisition consisted of a small portion of a nursery located at the northwest corner of Army Trail Road and Route 53 plus the access rights from the remaining property to Army Trail Road. This property was located 150 feet of the northbound entrance ramp of the Army Trail Road interchange to the North-South Tollway. ISTHA acquired the property in accordance with an agreement with the Illinois Department of Transportation providing that intersections near to and affected by the new toll road would be upgraded. ISTHA acquired the property for these off-alignment improvements but then turned title to the acquired property over to IDOT.



Judge Nickels, writing for the appellate court, held that testimony of benefits to the remaining property arising out of its proximity to the new toll road constituted general benefits, stating:

Section 7-120 of the Code requires that special benefits be considered from “any public improvement to be erected on such property.” (Ill.Rev.Stat.1989, ch. 110, par. 7-120.) Although plaintiff contends that, under Heritage Standard Bank, the location of the property is unimportant as long as it is used or needed for part of the public improvement project, we do not read Heritage Standard Bank so broadly. This court reasoned in Heritage Standard Bank that the public improvement erected on the property was the tollway, and the ramps, as part of the tollway project while not on defendants’ property, were part of the public improvement erected on the property taken from the defendants. Unlike Heritage Standard Bank, here the public improvement, the tollway, is not being erected on any part of the defendants’ property. The ramp is part of the tollway project, and the property was taken in connection with the tollway project; however, the actual public improvement is not located on any part of defendants’ property. This fact distinguishes this case from Heritage Standard Bank. Based upon this reasoning and section 7-120 of the Code, the trial court erred as a matter of law in admitting evidence of special benefits from the tollway. 576 N.E.2d at 1225.

Thus, off-alignment improvements, even if necessary for the project, do not qualify for special benefits according to the Itasca Bank & Trust court. As an interesting footnote, Judge Dunn, who wrote the Heritage Standard opinion, concurred in Itasca Bank & Trust. However, Judge McLaren, who had concurred in Judge Dunn’s Heritage Standard opinion, filed a dissent in Itasca Bank & Trust, asserting that the benefits were special, not general. The Second District followed the approach set forth in Itasca Bank & Trust when it issued its opinion in American National Bank. This case involved a partial acquisition of property to construct compensatory wetlands to replace preexisting wetlands destroyed by the North-South Tollway project and to provide access to an existing utility easement. The property was “situated west of and adjoining the main line of the North-South Toll Road where it intersects with Roosevelt Road.” 606 N.E.2d at 148. The trial court excluded any evidence of benefits to the remainder property arising out of the construction of the North-South Tollway. Upholding the trial court’s exclusion, the appellate court narrowly read Heritage Standard and held that because no part of the public improvement (North-South Tollway) would be located in the part taken, “the relationship between the North-South tollway and the defendants’ remainder is too tenuous to consider the special benefits of the tollway to it.” 606 N.E.2d at 150. When the Supreme Court considered the appeal of the appellate court’s decision in American National Bank, supra, the Supreme Court focused its analysis on the market value standard rather than on whether the roadway was located on the part taken. The Supreme Court noted that damages are to be awarded only when, in fact, the market value of the remainder has been reduced. Under this analysis, if the benefits are not conjectural or speculative and do affect the market value of the remainder, they should be admitted. The Supreme Court also criticized the appellate court’s restrictive definition of the scope of the public improvement, noting that the



compensatory wetlands were as much a part of the project as the roadway. The standard set by the court is whether the part taken is for “necessary parts of the project.” 642 N.E.2d at 1256. The Supreme Court held:

Under the clear and unambiguous language of this statute, evidence of benefits from the improvement may be adduced regardless of where the improvement was erected. Id.

The minority opinion criticizes the majority’s construction of the special-benefits statutes and alleged overruling of the trial court’s factual determination that the alleged benefits were too remote and speculative to be considered. The minority opinion also would require that the condemnor be able to establish special benefits with evidence “free from doubt” before it could be considered. 642 N.E.2d at 1260. To determine whether the remainder has benefited, the parties must value the entire property. An owner may not value only one portion of the remainder to avoid considering the benefit the improvement may have on the other portion of the remainder. Department of Public Works & Buildings v. Barton, 371 Ill. 11, 19 N.E.2d 935 (1939). The method of proving benefits often determines whether they will be considered special or general benefits. A good example of how the same claim of benefit — increased traffic after the improvement — may be admitted in evidence if proven correctly and may be excluded if not proven correctly can be seen in the contrasting results reached in Illinois State Toll Highway Authority v. Humphrey Estate, 62 Ill.App.3d 316, 379 N.E.2d 626, 19 Ill.Dec. 754 (2d Dist. 1978), and Department of Public Works & Buildings v. Divit, 25 Ill.2d 93, 182 N.E.2d 749 (1962). Another example of a special benefit is the use of “substitute condemnation” as exemplified in City of Chicago v. Midland Smelting Co., 385 Ill.App.3d 945, 896 N.E.2d 364, 324 Ill.Dec. 578 (1st Dist. 2008). Here, the appellate court issued an opinion upholding the condemnation of property for conveying the condemned property to the owner of other property. The other property consisted of a commercial building and a parking lot located across the street but under the same ownership as the commercial building. When the government condemned the parking lot, the commercial building lot was left without parking. So, to mitigate the damage to the commercial building lot, the government acquired part of an adjacent parcel to provide substitute or replacement parking. This substitute condemnation is effectively a benefit to the owner of the commercial lot. As part of the compensation being paid to the commercial lot owner, it can be used to offset any damage claims. V. VALUATION IN EASEMENT ACQUISITIONS A. [7.53] Permanent Easement The acquisition of a permanent easement presents two valuation questions: 1. Does the imposition of the easement damage the property within the easement area and, if so, how much?



2. Does the imposition of the easement damage the remaining property outside the easement area and, if so, how much? Central Illinois Public Service Co. v. Lee, 409 Ill. 19, 98 N.E.2d 746 (1951); Village of Round Lake v. Amann, 311 Ill.App.3d 705, 725 N.E.2d 35, 244 Ill.Dec. 240 (2d Dist. 2000). These questions arise whether the easement is an aboveground easement for power lines (Illinois Power & Light Corp. v. Barnett, 338 Ill. 499, 170 N.E. 717 (1930)) or an underground easement (Peoples Gas Light & Coke Co. v. Buckles, 24 Ill.2d 520, 182 N.E.2d 169 (1962)). Since an easement acquisition involves the determination of the depreciation of the property within and without the easement area, the valuation rules in partial acquisitions apply to the easement cases. For example, each party is entitled to show that the area within the easement strip has a different highest and best use than the existing use and to base its valuation on such use. City of Chicago v. Sexton, 408 Ill. 351, 97 N.E.2d 287 (1951). I.P.I. — Civil Nos. 300.54 – 300.58 contain a very helpful summary of the issues created by a permanent easement acquisition. Because most appraisers adopt a taking approach to the valuation of an easement instead of the damage approach adopted by the Illinois courts, it is important to make sure that the valuation witness testifies in accordance with the proposed jury instructions. If the witness does not, at best the jury will have difficulty matching the appraiser’s opinions to the jury instructions, and at worst the court may strike the testimony. For an interesting approach to valuing permanent easements for underground pipelines, see Judge Easterbrook’s discussion of multiple regression analysis in Guardian Pipeline, L.L.C. v. 950.80 Acres of Land, 525 F.3d 554 (7th Cir. 2008). B. [7.54] Temporary Easement Although temporary easement acquisitions share many of the same characteristics as permanent easement acquisitions, the temporary nature of the easement creates some unique problems. For example, in Housing Authority of City of East St. Louis v. Kosydor, 17 Ill.2d 602, 162 N.E.2d 357, 359 (1959), the Supreme Court indicated that the compensation for a temporary easement could include moving expenses. Along the same lines, §10-5-20 of the Eminent Domain Act provides:

Construction easement. If a taking is for a construction easement only, any structure that has been removed or taken shall be repaired, reestablished or relocated, at the option of the landowner, when the cost of the action does not exceed the just compensation otherwise payable to the landowner. 735 ILCS 30/10-5-20.

The request for a temporary easement, like the request for a permanent easement, must specify exactly what the condemnor intends to do with the property. Should the condemnor request the use of property for a temporary period and then actually use the property for a longer period, the condemnor is obligated to pay for the additional time needed to complete the project. Department of Transportation of State of Illinois ex rel. People v. Gallay, 20 Ill.App.3d 32, 312 N.E.2d 759 (5th Dist. 1974). Should the parties fail to specify whether the easement is temporary



or permanent, subsequent litigation may ensue over the extent of the government’s property interest. People ex rel. Peters v. O’Connor, 311 Ill.App.3d 753, 725 N.E.2d 391, 244 Ill.Dec. 280 (3d Dist. 2000). Temporary easement or temporary taking cases rarely arise in the appellate courts, probably because of the relatively nominal amount of compensation involved. As a result, there is little direction from the courts for valuing a temporary easement. In Department of Transportation v. First Bank of Schaumburg, 260 Ill.App.3d 490, 631 N.E.2d 1145, 197 Ill.Dec. 686 (1st Dist. 1992), the appellate court applied the same principles for valuing a permanent easement to valuing a temporary easement. The appellate court disapproved using a rental approach; instead, it cited a permanent easement case to support a before-and-after approach for appraising a temporary easement. However, after the appellate court’s decision in First Bank of Schaumburg, the Supreme Court issued its opinion in Illinois State Toll Highway Authority v. American National Bank & Trust Company of Chicago, 162 Ill.2d 181, 642 N.E.2d 1249, 205 Ill.Dec. 132 (1994). In dicta commenting on a temporary easement, the Supreme Court stated:

The rate of return on real estate investments is a meaningful measure in setting the value of the easement, for it helps establish how much Carriage Hills could have earned on the property during the easement’s term. 642 N.E.2d at 1257.

This language more closely describes the reality of a temporary easement which, unlike the permanent easement, is imposed for a limited term and in many respects resembles an imposed leasehold situation. In federal acquisitions, temporary easements are valued by using the rental value of the land for the term of the taking. See UNIFORM APPRAISAL STANDARDS FOR FEDERAL LAND ACQUISITIONS §D-10 (Appraisal Institute, 2000), www.justice.gov/ sites/default/files/enrd/legacy/2015/04/13/Uniform-Appraisal-Standards.pdf (case sensitive). In 1987, the United States Supreme Court issued its opinion in First English Evangelical Lutheran Church of Glendale v. County of Los Angeles, California, 482 U.S. 304, 96 L.Ed.2d 250, 107 S.Ct. 2378 (1987). Holding that temporary takings are no different from permanent takings, the Supreme Court ruled that a regulation depriving an owner of all use of the property entitles the owner to compensation for the period between the imposition of the regulation and the date a court declares it to be a taking. This opens the door for recovery of damages for this period in contrast to the prior rule that limited the owner’s remedy to invalidation of the regulation. Making a money remedy available may lead to substantial litigation over the valuation of damages arising from such temporary takings in the future. Temporary takings may also occur when a governmental body floods property or otherwise renders it uninhabitable by the owners for a period of time. While the temporary taking may be compensable, compensation may be measured differently than in a normal temporary easement situation. Pineschi v. Rock River Water Reclamation District, 346 Ill.App.3d 719, 805 N.E.2d 1241, 282 Ill.Dec. 224 (2d Dist. 2004). See also Arkansas Game & Fish Commission v. United States, ___ U.S. ___, 184 L.Ed.2d 417, 133 S.Ct. 511 (2012). In Hampton v. Metropolitan Water Reclamation District of Greater Chicago, 2106 IL 119861, the Supreme Court concluded temporary flooding could constitute a temporary taking, but there is no blanket rule. The factors to be considered are (1) the duration of flooding, (2) the

http://www.justice.gov/%0bsites/default/files/enrd/legacy/2015/04/13/Uniform-Appraisal-Standards.pdf

http://www.justice.gov/%0bsites/default/files/enrd/legacy/2015/04/13/Uniform-Appraisal-Standards.pdf



intended or foreseeable result of the government action, (3) the character of the property, and (4) the owner’s reasonable economic expectations regarding use of the property. The court adopted the same approach to takings claims based on intermittent flooding as was done by the United States Supreme Court in Arkansas Game & Fish, supra.


Trial Procedure and Technique WILLIAM L. BROOM III Barrett, Twomey, Broom, Hughes & Hoke, LLP Carbondale The contribution of George C. Hupp, Sr., to previous editions of this chapter is

gratefully acknowledged.

8



I. Trial Advocacy in Eminent Domain Cases A. [8.1] Trial Atmosphere B. [8.2] Condemnation Lawyer II. General Procedural Rules A. [8.3] General Constitutional and Statutory Provisions B. [8.4] Severance and Consolidation C. [8.5] Trial Setting III. Jury A. [8.6] Right to Jury Trial B. [8.7] Number of Jurors; Peremptory Challenges C. [8.8] Voir Dire D. [8.9] Oath of Jurors IV. [8.10] Opening Statement — General Theory V. Jury View of Property A. [8.11] When Required B. [8.12] View as Evidence C. [8.13] Time for Request and Time of View D. [8.14] Conduct of the View VI. [8.15] Collateral Evidence VII. [8.16] Comparable-Sales Evidence — General Rules VIII. [8.17] Voluntary Transactions for Cash A. [8.18] Voluntary Sale B. [8.19] Sale for Cash C. [8.20] Assemblage Sales

TRIAL PROCEDURE AND TECHNIQUE

ILLINOIS INSTITUTE OF CONTINUING LEGAL EDUCATION 8 — 3

IX. [8.21] Similarity A. [8.22] Proximity B. [8.23] Size C. [8.24] Utilities D. [8.25] Zoning and Location in Municipality E. [8.26] Improved and Unimproved Properties F. [8.27] Subdivided Land as Opposed to Acreage G. [8.28] Date of Sale H. [8.29] Highest and Best Use X. Purchase Price of the Subject Property A. [8.30] In General B. [8.31] Offers XI. [8.32] Wilson v. Clark and Its Effect on Admission of Comparable-Sales Evidence XII. [8.33] Conclusion Regarding Sales Evidence XIII. Demonstrative Evidence — Maps, Plats, and Photographs A. [8.34] Depicting Existing Conditions B. [8.35] Depicting Proposed Highest and Best Use XIV. Presenting Valuation Witnesses A. [8.36] For a Total Taking B. [8.37] The Owner as a Valuation Witness C. [8.38] Sample Questions for Valuation Witness D. [8.39] Partial Taking with Damages to the Remainder XV. [8.40] Right To Open and Close XVI. Jury Instructions A. [8.41] In General B. [8.42] Cautionary Instructions C. [8.43] Definitional Instructions D. [8.44] Rezoning



E. [8.45] Stipulations and Agreements F. [8.46] Expert Testimony XVII. [8.47] Closing Argument

TRIAL PROCEDURE AND TECHNIQUE §8.3


I. TRIAL ADVOCACY IN EMINENT DOMAIN CASES A. [8.1] Trial Atmosphere The trial of eminent domain cases often presents an air of bitterness strangely different from that present in the trial of other civil cases. Many times a governmental body, as a plaintiff, seeks to acquire the defendant’s property in a situation in which the defendant never had any desire or intention of selling. Even though the defendant may be adequately compensated for the taking and any damage sustained by reason of the taking, the defendant nevertheless must pay his or her own costs, attorneys’ fees, and expenses and also suffer the loss of the time and inconvenience involved in preparing for and presenting the defense. The trial lawyer who undertakes the representation of either side in such a case, however, must guard carefully against this air of bitterness and not allow it to influence his or her handling or judgment in the matter. B. [8.2] Condemnation Lawyer Only rarely do most trial lawyers become involved in an eminent domain case. There are few lawyers or firms that can afford to specialize in this type of practice. The professional trial lawyer who undertakes the trial of an eminent domain case must become familiar with the law of eminent domain, and, having done so, he or she then must approach the case like any other, employing the same ethics and standard of preparation. II. GENERAL PROCEDURAL RULES A. [8.3] General Constitutional and Statutory Provisions The Fifth Amendment to the United States Constitution provides that “private property [shall not] be taken for public use, without just compensation.” Similarly, Article I, §15, of the Illinois Constitution provides that

[p]rivate property shall not be taken or damaged for public use without just compensation as provided by law. Such compensation shall be determined by a jury as provided by law.

The eminent domain statutes of Illinois are found in the Eminent Domain Act, 735 ILCS 30/1-1-1, et seq. They constitute the basic procedural law in eminent domain cases. The Code of Civil Procedure, 735 ILCS 5/1-101, et seq., also applies to condemnation cases, as do the Supreme Court Rules. S.Ct. Rule 1. When both the Eminent Domain Act and the Code of Civil Procedure are silent, the practice in eminent domain cases is governed by common law. Department of Public Works & Buildings v. Huff, 15 Ill.2d 517, 155 N.E.2d 563, 565 (1959). Counsel should also consult the local rules of the circuit in which the case is pending.



B. [8.4] Severance and Consolidation 735 ILCS 30/10-5-30 provides that “[a]ny number of separate parcels of property, situated in the same county, may be included in one complaint, and the compensation for each shall be assessed separately by the same or different juries, as the court may direct.” When more than one parcel of property is included in one complaint, it is a matter of sound discretion of the trial court as to whether any defendant or group of defendants will be granted a separate trial. See City of Chicago v. Chicago Title & Trust Co., 331 Ill. 322, 163 N.E. 17 (1928); Martin v. Chicago & M. Electric Ry., 220 Ill. 97, 77 N.E. 86, 88 (1906); Chicago & N.W. Ry. v. Chicago Mechanics’ Institute, 239 Ill. 197, 87 N.E. 933, 940 (1909); Department of Public Works & Buildings of State of Illinois ex rel. People v. Seeber, 93 Ill.App.2d 271, 235 N.E.2d 269 (4th Dist. 1968). C. [8.5] Trial Setting The Illinois Supreme Court has characterized the eminent domain statutes as contemplating a speedy trial without delays. See Moll v. Sanitary Dist. of Chicago, 228 Ill. 633, 81 N.E. 1147, 1148 (1907); Sanitary Dist. of Chicago v. Chapin, 226 Ill. 499, 80 N.E. 1017, 1018 (1907). This fact indicates that eminent domain cases should have a preference over the setting of other civil trials. As a general rule, many of the witnesses who are to testify in a particular eminent domain proceeding also have commitments in other similar cases. Consequently, every effort should be made by counsel and the courts to schedule the trial of an eminent domain proceeding for a date certain in order that those witnesses may avoid conflicts. This procedure will result in a more expeditious trial and the avoidance of unnecessary delays and recesses. III. JURY A. [8.6] Right to Jury Trial Article I, §15, of the Illinois Constitution provides:

Private property shall not be taken or damaged for public use without just compensation as provided by law. Such compensation shall be determined by a jury as provided by law.

735 ILCS 30/10-5-5(a) provides:

Private property shall not be taken or damaged for public use without just compensation and, in all cases in which compensation is not made by the condemning authority, compensation shall be ascertained by a jury, as provided in this Act. When compensation is so made by the condemning authority, any party, upon application, may have a trial by jury to ascertain the just compensation to be paid. A demand on the part of the condemning authority for a trial by jury shall be filed with the complaint for condemnation of the condemning authority. When the



condemning authority is plaintiff, a defendant desirous of a trial by jury must file a demand for a trial by jury on or before the return date of the summons served on him or her or on or before the date fixed in the publication in case of defendants served by publication. If no party in the condemnation action demands a trial by jury, as provided for by this Section, then the trial shall be before the court without a jury.

A question must be raised as to the constitutionality of that section, inasmuch as the Constitution provides that compensation in eminent domain cases “shall” be determined by a jury as provided by law, and inasmuch as the legislature under the present statute has taken the position that, in those cases in which compensation is made by the condemning authority (e.g., the state, a county, or a municipality), a trial by jury must be affirmatively requested. While it would seem axiomatic that any party to litigation may waive the right of a jury trial (Chicago, M. & St. P. Ry. v. Hock, 118 Ill. 587, 9 N.E. 205, 207 (1886)), serious doubt must attend any attempt by the legislature to regulate or procedurally deny the right. There are a number of cases that deal with the right of the legislature to regulate the timeliness of requests for trials by jury and the waiver thereof (Stephens v. Kasten, 383 Ill. 127, 48 N.E.2d 508, 510 (1943); First Bank of Oak Park v. Carswell, 111 Ill.App.3d 71, 443 N.E.2d 755, 757, 66 Ill.Dec. 829 (1st Dist. 1982); Westerfield v. Redmer, 310 Ill.App. 246, 33 N.E.2d 744, 746 (1st Dist. 1941); Chmielewski v. Marich, 350 Ill.App. 379, 113 N.E.2d 69, 71 (1st Dist. 1953)), but none of these cases deal with a situation in which a trial by jury is mandated by the Constitution. In Waukegan Port District v. Booras, 55 Ill.App.3d 790, 371 N.E.2d 321, 326, 13 Ill.Dec. 604 (2d Dist. 1977), the court (in construing then-applicable Ill.Rev.Stat. (1975), c. 47, ¶1, which was basically the same as the statute dealt with here) mentioned that a jury trial will be provided only if it is demanded by a party. The court noted that the demand for a jury by one of the defendants came nearly a month after judgment had been rendered and thus was untimely. It does not appear, however, that the constitutionality issue was raised in the case. Therefore, the safe procedure would be for attorneys representing petitioners to demand a jury at the time of the filing of the complaint and to follow by having a jury fix the award of compensation and damages in all cases in which all of the defendants do not specifically waive the right and, particularly, in all cases in which any defendant has been defaulted. B. [8.7] Number of Jurors; Peremptory Challenges 735 ILCS 30/10-5-35 provides that the “plaintiff, and every party interested in the ascertaining of compensation, shall have the same right of challenge of jurors as in other civil cases in the circuit courts.” 735 ILCS 5/2-1105(b) was amended effective June 1, 2015, to provide that all jury cases shall be tried by a jury of six. The amendment changing the number of jurors from twelve to six was ruled unconstitutional by the Circuit Court of Cook County. Kakos v. Bauer, No. 2015 L 6691 (Cook Cty.Cir. Dec. 21, 2015). In May 2016, on a direct appeal, the Illinois Supreme Court heard oral argument in Kakos. At the time of publication of this handbook, the Illinois Supreme Court had not ruled.



735 ILCS 5/2-1106(a) provides that each side shall be entitled to five peremptory challenges. The section further provides that

[i]f there is more than one party on any side, the court may allow each side additional peremptory challenges, not to exceed 3, on account of each additional party on the side having the greatest number of parties. . . . If the parties on a side are unable to agree upon the allocation of peremptory challenges among themselves, the allocation shall be determined by the court. Id.

The courts generally are fairly liberal in granting additional challenges, but in most eminent domain cases, more than one owner is designated as a defendant with respect to each parcel sought to be taken. If the interest of the parties with respect to each parcel is the same, additional peremptory challenges rarely will be allowed. When separate parcels are being tried together with separate distinct ownership involved, each parcel is considered a separate party. 735 ILCS 5/2-1106(b) also provides that one or two jurors, in addition to the regular panel, be selected to serve as alternate jurors. Attorneys generally agree to accept the verdict of eleven or, in some cases, the verdict of as few as ten, in the case of incapacity of a juror or jurors during a trial. Due to the expense involved in the trial of most eminent domain cases, at least one alternate juror should be selected if the attorneys cannot make such a stipulation. C. [8.8] Voir Dire S.Ct. Rule 234 governs the conduct of the voir dire examination of the jurors. The rule provides that the court shall conduct the voir dire examination of prospective jurors by putting to them questions it thinks appropriate, touching on their competency to serve as jurors in the case on trial. The rule further provides that the court may permit the parties to submit appropriate additional questions to it for further inquiry or may permit the parties to supplement the examination by such direct inquiry as the court determines proper. The rule also provides that questions shall not directly or indirectly concern matters of law or instructions. While S.Ct. Rule 234 provides that the court may conduct the entire voir dire, most trial judges permit the attorneys for the parties on trial to ask additional questions after the initial interrogation of the jury by the court. This questioning of the jurors is the opening gambit in the attorney’s relationship with the jurors, a relationship that continues through the trial until counsel’s concluding remarks in the final argument. To be an effective advocate for the client, the attorney should be sure that this first contact with the jurors is a favorable one. Therefore, the preparation and care in the voir dire can be as important, in many cases, as the trial of the case itself. The method of conducting the voir dire is beyond the scope of this chapter. See Robert Marc Chemers, Ch. 2, The Jury: The “Right” to It and the Selection of It, ILLINOIS CIVIL PRACTICE: TRYING THE CASE (IICLE®, 2012). Simply stated, the voir dire should be conducted so as to give the jurors a favorable impression of counsel and at the same time give counsel the information needed to exercise — or not to exercise — a peremptory challenge or challenge for cause. The luck of the draw, insofar as jurors are concerned, can certainly determine the direction of the voir dire. Therefore, each trial attorney should have an outline of exactly the



kind of juror he or she would like to have try the case and, conversely, the type of juror he or she would want to exclude. The petitioner’s attorney in an eminent domain action does not want, in most cases, to have jurors who have had or who expect to have their property taken by a governmental body. By the same token, counsel for a defendant will shy away from employees of the condemning body or jurors similarly situated. Obviously, the circumstances of each case must govern the jury selection. Inasmuch as the trial of the eminent domain case is solely for the determination of the compensation and damages to be awarded the defendants by reason of the taking, and inasmuch as all matters pertaining to the right and necessity of the petitioner to condemn have already been resolved as a matter of law by the court, any questions directed to the jurors concerning those matters are improper. D. [8.9] Oath of Jurors 735 ILCS 30/10-5-40 provides this supplemental oath to be administered to the jury in eminent domain proceedings:

You and each of you do solemnly swear that you will well and truly ascertain and report just compensation to the owner (and each owner) of the property which it is sought to take or damage in this case, and to each person therein interested, according to the facts in the case, as the same may appear by the evidence, and that you will truly report such compensation so ascertained: so help you God.

IV. [8.10] OPENING STATEMENT — GENERAL THEORY The opening statement in an eminent domain proceeding should be no different than in any other lawsuit. The purpose of an opening statement is to give the jury an outline of what the attorney for each side expects the evidence in the case to prove. It is improper for counsel to tell the jury what each witness will say in detail. See Pietsch v. Pietsch, 245 Ill. 454, 92 N.E. 325, 326 (1910); 75 AM.JUR.2d Trial §204 (1991). Counsel should be as brief as possible, yet lengthy enough to properly inform the jury of the client’s theory of the case affecting the valuation of the taking and damages, if any. In an eminent domain case, it is imperative that each side present its opening statement before the jury view of the premises in question takes place because, if the view is to have any validity at all in the case, the jurors should be prepared for it by the opening statements. Those physical characteristics of the premises that counsel deems significant should be described with such clarity that the jurors can readily recognize them when they view the property.



V. JURY VIEW OF PROPERTY A. [8.11] When Required 735 ILCS 30/10-5-45 provides that the “jury shall, at the request of either party, go upon the land sought to be taken or damaged, in person, and examine the same.” The view is normally considered to be mandatory, notwithstanding the fact that there has been a substantial change in the condition of the premises between the date of the filing of the petition for condemnation and the time of the jury view. See Springer v. City of Chicago, 135 Ill. 552, 26 N.E. 514, 517 (1891); South Park Com’rs v. Livingston, 344 Ill. 368, 176 N.E. 546, 549 (1931). However, the Illinois courts have recognized that, under the quick-take procedure or certain other situations involving a substantial change in the appearance of the property, the requirement for a jury view of the premises would result in an injustice. In these situations, a view by the jury is within the sound discretion of the trial court. See Department of Public Works & Buildings v. Remmerie, 29 Ill.2d 40, 192 N.E.2d 877, 878 – 879 (1963); Department of Business & Economic Development v. Phillips, 43 Ill.2d 28, 251 N.E.2d 170, 174 (1969); Illinois State Toll Highway Authority v. Grand Mandarin Restaurant, Inc., 189 Ill.App.3d 355, 544 N.E.2d 1145, 1148, 136 Ill.Dec. 370 (2d Dist. 1989); Department of Public Works & Buildings of State of Illinois ex rel. People v. American National Bank & Trust Co., 36 Ill.App.3d 439, 343 N.E.2d 686, 691 (2d Dist. 1976). If such a view is permitted under any situation in which there has been a change in the condition of the property, the jury must be advised of the changes between the date of filing and the view. See City of Chicago v. Shell Oil Co., 29 Ill.2d 136, 193 N.E.2d 759, 760 (1963). If the case is tried before a court and without a jury, a view by the trial judge is not required but is within his or her sound discretion. City of Chicago v. Lord, 279 Ill. 582, 117 N.E. 52, 55 (1917). B. [8.12] View as Evidence Although a view of the premises is evidence to be considered by the jurors (Cook County v. North Shore Electric Co., 390 Ill. 147, 60 N.E.2d 855 (1945)), the jurors may not ignore the other evidence of value in the case in arriving at their verdict. City of Chicago v. Callender, 396 Ill. 371, 71 N.E.2d 643 (1947); City of Chicago v. Koff, 341 Ill. 520, 173 N.E. 666, 668 (1930). Specifically, the jury will be instructed that the evidence consists of testimony of the witnesses, exhibits admitted by the court, and the jury’s view of the property. C. [8.13] Time for Request and Time of View The caselaw affords little guidance as to the time to make the request for the view. Good practice would suggest that the request should be made promptly at the beginning of the trial and out of the jury’s presence. The request should be made before the close of the proofs. See Sanitary District of Chicago v. McGuirl, 86 Ill.App. 392, 399 (1st Dist. 1899). Similarly, the view, as evidence, should be conducted before the close of the proofs. Most lawyers in eminent domain cases find it best to hold the view either immediately after the opening



statements or after or during the testimony of the petitioner’s engineer as to the contemplated improvement. In the latter situation, plats, drawings, and other exhibits can be testified to and admitted into evidence, thus making the jury’s view of the premises more meaningful. See United States v. Meyer, 113 F.2d 387, 396 (7th Cir. 1940). D. [8.14] Conduct of the View The eminent domain statutes give little guidance for conducting the view. However, considering that the view is part of the evidence in the case to be considered by the jury along with all of the other evidence, both the court and counsel should take particular care to see that the view is conducted in such a way that it will enhance the jury’s understanding of the case. It behooves both the court and counsel for both sides to establish the conditions of the view at the earliest possible time, probably at a pretrial conference. If the attorneys cannot agree on the conditions of the view, the court should exercise its discretionary power and prescribe them. One of the most important matters to consider is who can speak or testify during the jury view. Specifically, the view will not be very helpful to the jurors if the boundaries of the whole property, the taking, and matters of interest are not pointed out to them during the view. Counsel should try to agree as to who will speak to the jury and what will be said to them. Obviously, having a representative of the plaintiff who is familiar with these items placed under oath before the view with a particular script or outline of topics to cover would be most helpful. In addition, counsel may wish to consider whether a court reporter should be present at all times. VI. [8.15] COLLATERAL EVIDENCE Direct evidence on value is elicited through opinion testimony of valuation witnesses. In many trials, the key to the process is the presentation of collateral evidence that supports, explains, or rebuts the opinions of value. The main areas of collateral evidence, discussed in §§8.16 – 8.35 below, are comparable sales, engineering testimony, land planning testimony, and demonstrative evidence. The jury’s sole task in a condemnation case is to decide “the just compensation to be paid to the owner of the property sought to be condemned.” City of Chicago v. Anthony, 136 Ill.2d 169, 554 N.E.2d 1381, 1383, 144 Ill.Dec. 93 (1990); City of Quincy, Illinois v. Diamond Construction Co., 327 Ill.App.3d 338, 762 N.E.2d 710, 715 – 716, 261 Ill.Dec. 141 (4th Dist. 2002). Just compensation is “the fair cash market value of the subject property at its highest and best use on the date of the filing of the complaint to condemn.” Anthony, supra, 554 N.E.2d at 1383. See also Department of Transportation ex rel. People v. Central Stone Co., 200 Ill.App.3d 841, 558 N.E.2d 742, 744, 146 Ill.Dec. 779 (4th Dist. 1990). A defendant’s counterclaim for damage to the remainder is also measured by calculating the fair market value of the defendant’s property, both immediately before and after the taking. Department of Transportation v. First Bank of Schaumburg, 260 Ill.App.3d 490, 631 N.E.2d 1145, 1150, 197 Ill.Dec. 686 (1st Dist. 1992). Counsel may wish to emphasize the definitions of “just compensation,” “fair cash market value,” and “damage to the remainder” by referring to the jury instructions in both the opening



statement and closing arguments. Because just compensation is the only issue for the jury to decide, all other collateral issues should be avoided. See Sanitary Dist. of Rockford v. Johnson, 343 Ill. 11, 174 N.E. 862, 864 (1931) (just compensation is “the only issue triable by jury” in eminent domain case; “[a]ll other questions are preliminary and must be determined by the court” before jury is empaneled); Department of Public Works & Buildings of State of Illinois v. Guerine, 19 Ill.App.3d 509, 311 N.E.2d 722, 725 (2d Dist. 1974) (testimony should be barred if it relates to collateral issues “that would unduly distract from the main issue of determining just compensation”). VII. [8.16] COMPARABLE-SALES EVIDENCE — GENERAL RULES The price for which similar properties are sold (comparable sales) is, in many cases, the most effective evidence in a condemnation case. The jury is instructed to find the fair cash market value, i.e., the price the property would sell for on the open market if the buyer and the seller were acting voluntarily and with knowledge. A jury may be skeptical of highly qualified valuation witnesses with widely disparate opinions of value. Sales evidence is a key piece of evidence for a jury to use to test the opinions of value. Comparable-sales evidence is admissible if the transaction is bona fide, is voluntary, involves land similar to the subject property, and was made at or about the same time as the valuation date. City of Chicago v. Blanton, 15 Ill.2d 198, 154 N.E.2d 242 (1958). No fixed or general rules exist to govern the degree of similarity necessary to make a sale admissible. City of Chicago v. Vaccarro, 408 Ill. 587, 97 N.E.2d 766 (1951). Admission or exclusion of comparable-sales evidence rests in the discretion of the trial judge. Department of Conservation v. Aspegren Financial Corp., 72 Ill.2d 302, 381 N.E.2d 231, 21 Ill.Dec. 153 (1978). The party offering the comparable sales must present evidence to establish the similarity and admissibility of the sales. City of Evanston v. Piotrowicz, 20 Ill.2d 512, 170 N.E.2d 569 (1960); Commonwealth Edison Co. v. Danekas, 104 Ill.App.3d 907, 433 N.E.2d 736, 60 Ill.Dec. 694 (2d Dist. 1982). In one case, the Fifth District Appellate Court decided that evidence of offers to purchase adjacent property similar in size, location, and uses to the subject property is admissible. County of St. Clair v. Wilson, 284 Ill.App.3d 79, 672 N.E.2d 27, 219 Ill.Dec. 712 (5th Dist. 1996). This decision is a surprising extension of the law, even though it appears to be based on the fact that all of the experts on both sides indicated that bona fide offers to purchase such other property would be relied on by them in evaluating the subject property. Id. A party seeking to admit a comparable sale must usually proffer a sale witness to the trial court in camera. The sale witness must be able to establish that the property was in fact sold and must also be able to verify the price of the sale. A broker, attorney, or principal to the transaction can be used as a sale witness. If the sale witness cannot describe the property, the proffering party can offer the testimony of one of its valuation witnesses to testify to points of similarity. A party opposing the sale can, of course, cross-examine the sale witness and make objections to the sale. The attorney must make careful preparations in the admission of comparable sales and should fully understand the transactions, have cases ready to support or defeat the sales, and supply the court with photographs or other evidence that either establishes or defeats comparability.



A certified copy of the deed for the similar sale should also be offered into evidence. Morton Grove Park District v. American National Bank & Trust Company of Chicago, 39 Ill.App.3d 426, 350 N.E.2d 149 (1st Dist. 1976). If the trial court rules that a sale is admissible, the comparable-sale witness should be presented in front of the jury to establish the price of the sale. Explanation of the comparability should be left to the valuation witnesses and argument. The best of both worlds is to have a sale witness, usually a broker, also testify as a valuation witness because his or her credibility will be enhanced by a superior knowledge of the comparable sale. Aerial photographs are helpful in presenting and explaining comparable-sales evidence to the jury. Google Earth can be an excellent resource. The closer the comparable sales are to the subject property, the more likely they can be analogized to the jury in terms of zoning, access, utilities, and development trends. If counsel’s opponent has succeeded in presenting comparable-sales evidence to the jury, it is generally advisable to attempt to discredit the sales, which can be done by showing the differences in location, use, utilities, size, topography, neighboring uses, unusual terms of the sales, access, traffic counts, zoning, soils, etc. These factors can be established through rebuttal testimony, cross-examination of opposing experts who considered the sales, or direct testimony of counsel’s own valuation witness. It is critical that the expert be familiar with the sales relied on by the other witnesses. Much of the cross-examination of the expert should be directed toward exploring this familiarity. No text can prepare a party for presentation of the comparable sales in each case because every property is different. In each case, the attorney must search out the law and facts that support the client’s position and present those to the court. VIII. [8.17] VOLUNTARY TRANSACTIONS FOR CASH The admissibility of a sale is basically a relevance issue. To be relevant to the issue of fair cash market value, the sale must be between a willing buyer and a willing seller and for cash. A. [8.18] Voluntary Sale Many attorneys misapprehend the idea of a voluntary transaction and seek to exclude sales because of the unfortunate circumstances of the seller. In Forest Preserve Dist. of Cook County v. Eckhoff, 372 Ill. 391, 24 N.E.2d 52, 54 (1939), the court stated:

The record, however, shows that the sales in question were the result of negotiations between the parties, which ordinarily excludes the idea of an involuntary sale. A person may be compelled by force of circumstances to part with property which he might desire to hold, but involuntary sales imply compulsion under a decree, execution or something more than inability to pay up-keep charges.



Thus, the fact that the seller is having a difficult time financially or that inheritance taxes had to be paid from an estate will not suffice to bar the sale as involuntary. A sale resulting from liquidation of property is not necessarily involuntary. Forest Preserve Dist. of Cook County v. Folta, 377 Ill. 158, 36 N.E.2d 264 (1941). Listing the property with a broker has been held to be evidence of the voluntary nature of the transaction. Eckhoff, supra; City of Chicago v. Vaccarro, 408 Ill. 587, 97 N.E.2d 766 (1951). A sale under threat of condemnation is not a comparable sale. In Board of Trustees of University of Illinois v. Shapiro, 343 Ill.App.3d 943, 799 N.E.2d 383, 389, 278 Ill.Dec. 665 (1st Dist. 2003), the court stated that it was “well established that property sales made under threat of condemnation [were] not reliable evidence of fair market value,” and were inadmissible for that reason. B. [8.19] Sale for Cash Many sales are not admissible because they do not reflect the cash market value of a property. Sales of land to a body with the power of eminent domain are not considered voluntary market transactions, since the effect of that power on the price is speculative. Forest Preserve District of Cook County v. Galt, 412 Ill. 500, 107 N.E.2d 682 (1952); City of Chicago v. Avenue State Bank, 4 Ill.App.3d 235, 281 N.E.2d 66 (1st Dist. 1972). A sale pursuant to a foreclosure decree is not an indication of market value. West Skokie Drainage Dist. v. Dawson, 243 Ill. 175, 90 N.E. 377 (1909). A sale involving the trade of land is not evidence of market value. Department of Business & Economic Development v. Baumann, 56 Ill.2d 382, 308 N.E.2d 580 (1974). But see Department of Public Works & Buildings v. Klehm, 56 Ill.2d 121, 306 N.E.2d 1 (1973) (sale was held not trade, since total price to be paid for property was set and purchase price of other properties did determine price of property sold). Noncash considerations may bar admission of a sale. See Sanitary Dist. of Chicago v. Boening, 267 Ill. 118, 107 N.E. 810 (1915) (seller agreed to build switching track); Department of Business & Economic Development of State of Illinois ex rel. People v. Baumann, 9 Ill.App.3d 1, 291 N.E.2d 213 (2d Dist. 1972) (zoning contingency and right to farmland free of charges were noncash factors), rev’d on other grounds, 56 Ill.2d 382 (1974); Department of Conservation of State of Illinois v. Aspegren Financial Corp., 47 Ill.App.3d 118, 361 N.E.2d 635, 5 Ill.Dec. 312 (2d Dist. 1977) (right to use property after sale, retention of easements, and right to mine gravel were considered in barring sale), aff’d, 72 Ill.2d 302 (1978). These cases indicate the court’s concern with trying collateral issues that might confuse the jury. Noncash considerations make the sales less probative as to fair cash market value and lead to evidence on collateral issues being necessary to explain the dollar significance of these considerations. Counsel seeking to exclude a proposed sale from evidence should thoroughly investigate any noncash factors involved in the sale.



C. [8.20] Assemblage Sales The sale of a property to a neighboring owner who has a special use and need for the property purchased does not reflect market value and is, therefore, not admissible. Trustees of Schools of Township Number 37 North Range Number 13 East, Cook County, Illinois v. Chicago City Bank & Trust Co., 126 Ill.App.2d 302, 262 N.E.2d 80 (1st Dist. 1970); Forest Preserve District of Cook County v. South Holland Trust & Savings Bank, 38 Ill.App.3d 873, 349 N.E.2d 689 (1st Dist. 1976); Department of Transportation of State of Illinois ex rel. People v. Prombo, 63 Ill.App.3d 407, 379 N.E.2d 953, 20 Ill.Dec. 120 (3d Dist. 1978). IX. [8.21] SIMILARITY As mentioned in §8.16 above, there is no set rule for admissibility of sales, and, of course, no two properties are identical. In §§8.22 – 8.29 below are some factors courts have discussed in ruling on admissibility. These points must be fully developed for each sale. A. [8.22] Proximity Proximity between the subject and sale properties is an important factor. Proximity alone is not sufficient to support admission if there is a significant difference in the character of the area, even if only a few blocks separate the properties. See City of Chicago v. Avenue State Bank, 4 Ill.App.3d 235, 281 N.E.2d 66 (1st Dist. 1972). If a property is located in a faster developing area, then admission may be denied. Department of Public Works & Buildings of State of Illinois ex rel. People v. Huffeld, 68 Ill.App.2d 120, 215 N.E.2d 312 (3d Dist. 1966). See also City of Chicago v. Harbecke, 409 Ill. 425, 100 N.E.2d 616 (1951). Longer distances may not bar admission if the subject property has an unusual use not found in the immediate area. City of Chicago v. Mullin, 285 Ill. 296, 120 N.E. 785 (1918). B. [8.23] Size The size of the property is a factor to consider, but when the trial court set an arbitrary minimum on the size of a comparable property, it was reversed. City of Chicago v. Harbecke, 409 Ill. 425, 100 N.E.2d 616 (1951). A difference in size alone is not enough to bar comparability when there are other significant points of similarity. Department of Public Works & Buildings of State of Illinois ex rel. People v. Exchange National Bank of Chicago, 40 Ill.App.3d 623, 356 N.E.2d 376, 1 Ill.Dec. 250 (2d Dist. 1976); Lake County Forest Preserve District v. Reliance Standard Life Insurance Co., 29 Ill.App.3d 145, 329 N.E.2d 344 (2d Dist. 1975). When parts of the subject property have different highest and best uses, then sales of smaller sites may be used to value the remainder. In Department of Public Works & Buildings of State of Illinois ex rel. People v. First National Bank of Joliet, 9 Ill.App.3d 633, 292 N.E.2d 487 (3d Dist. 1973), sales of three one-acre gasoline service station sites were admitted when the entire property included 141 acres.



In Department of Transportation of State of Illinois v. Association of Franciscan Fathers of State of Illinois, 93 Ill.App.3d 1141, 418 N.E.2d 36, 49 Ill.Dec. 392 (2d Dist. 1981), sales from 1 acre to 601 acres were admitted by the opposing parties to prove their conflicting theories of value. C. [8.24] Utilities The absence or presence of utilities alone does not determine the admissibility of a comparable sale. In Forest Preserve District of DuPage County, Illinois v. Harris Trust & Savings Bank, 108 Ill.App.2d 65, 247 N.E.2d 188 (2d Dist. 1969), the difference in the adaptability for utilities was held to be a ground for barring a sale; however, the adaptability for utilities involved the size and location of the subject property. In Department of Public Works & Buildings v. Byford, 59 Ill.App.3d 844, 376 N.E.2d 358, 17 Ill.Dec. 359 (2d Dist. 1978), the court held that a difference in utilities alone is not enough to bar admission. In Department of Conservation v. Aspegren Financial Corp., 72 Ill.2d 302, 381 N.E.2d 231, 21 Ill.Dec. 153 (1978), a comparable sale was properly denied because of a difference in water service in addition to a difference in the character of the area and the distance. D. [8.25] Zoning and Location in Municipality Differences in zoning and location in a municipality are not alone sufficient to bar admission of a sale. City of Evanston v. Piotrowicz, 20 Ill.2d 512, 170 N.E.2d 569 (1960). However, differences in zoning and location in a different type of area are factors that can support denial of a sale. See Morton Grove Park District v. American National Bank & Trust Company of Chicago, 39 Ill.App.3d 426, 350 N.E.2d 149 (1st Dist. 1976); Department of Business & Economic Development of State of Illinois ex rel. People v. Baumann, 9 Ill.App.3d 1, 291 N.E.2d 213, 221 (2d Dist. 1972), rev’d on other grounds, 56 Ill.2d 382 (1974). As to location within a municipality, see Forest Preserve Dist. of Cook County v. Collins, 348 Ill. 477, 181 N.E. 345 (1932), and City of Chicago v. Harbecke, 409 Ill. 425, 100 N.E.2d 616 (1951). E. [8.26] Improved and Unimproved Properties In Department of Business & Economic Development of State of Illinois ex rel. People v. Baumann, 9 Ill.App.3d 1, 291 N.E.2d 213, 217 – 218 (2d Dist. 1972), rev’d on other grounds, 56 Ill.2d 382 (1974), the court held that there is no fixed rule to establish that the existence or nonexistence of improvements (buildings) bars a sale as a matter of law. This conclusion is supported by other cases dealing with the issue when other elements of dissimilarity exist. See Trustees of Schools of Township Number 37 North Range Number 13 East, Cook County, Illinois v. Chicago City Bank & Trust Co., 126 Ill.App.2d 302, 262 N.E.2d 80 (1st Dist. 1970) (also factors on assemblage); Sanitary Dist. of Chicago v. Boening, 267 Ill. 118, 107 N.E. 810 (1915) (also no cash considerations and arbitrary distribution of price); Forest Preserve District of Cook County v. Yelk, 115 Ill.App.2d 78, 252 N.E.2d 917 (1st Dist. 1969) (no evidence of similarity existed).



F. [8.27] Subdivided Land as Opposed to Acreage Subdivided land is not, as a matter of law, similar to un-subdivided land. Waukegan Park District v. First National Bank of Lake Forest, 22 Ill.2d 238, 174 N.E.2d 824 (1961). The issues are complex, and counsel should approach this problem carefully. The factual distinctions between the properties will control. For background on this problem, please review City of Benton, Illinois v. Odom, 123 Ill.App.3d 991, 463 N.E.2d 785, 79 Ill.Dec. 231 (5th Dist. 1984), and Department of Conservation of State of Illinois v. Dorner, 192 Ill.App.3d 333, 548 N.E.2d 749, 139 Ill.Dec. 364 (1st Dist. 1989). G. [8.28] Date of Sale Market value is determined as of the date the petition to condemn was filed, and, therefore, to be probative, a sale must occur at a time close to the date of filing. A sale occurring more than seven years before the date of filing was admitted in Forest Preserve Dist. of Cook County v. Kean, 298 Ill. 37, 131 N.E. 117 (1921). However, a sale five years before the date of filing would be properly denied in a case of a significant change in market conditions (e.g., the Great Depression). Forest Preserve Dist. of Cook County v. Collins, 348 Ill. 477, 181 N.E. 345 (1932). Sales occurring after the date on which the petition to condemn was filed are not inadmissible per se. Department of Business & Economic Development of State of Illinois ex rel. People v. Baumann, 9 Ill.App.3d 1, 291 N.E.2d 213 (2d Dist. 1972), rev’d on other grounds, 56 Ill.2d 382 (1974). There must be a showing that the sale was not affected by the improvement or the filing of the complaint for condemnation in the instant case for it to be admissible. Department of Business & Economic Development of State of Illinois ex rel. People v. Pioneer Trust & Savings Bank, 39 Ill.App.3d 8, 349 N.E.2d 467 (2d Dist. 1976); Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 250 Ill.App.3d 665, 619 N.E.2d 1321, 189 Ill.Dec. 272 (2d Dist. 1993), aff’d, 163 Ill.2d 498 (1994). H. [8.29] Highest and Best Use The similarity concerning the highest and best use of the subject property and a comparable-sale property is a factor but is certainly not controlling. The explanation is that each party has the right to adopt its own theory of highest and best use. Cook County v. Holland, 3 Ill.2d 36, 119 N.E.2d 760, 763 (1954). As the Supreme Court has stated:

As to the evidence, which must be viewed in the light that its purpose is to establish just compensation for the land, it has long been the rule that parties to a condemnation proceeding have the right to adopt their own theories as to the best and highest use of the land taken and each may introduce evidence without being bound by the theory of the other. . . . Since neither party is bound by the theory of



the other, it follows that the court is not limited to admitting evidence which embraces the theory of one party only. [Citation omitted.] Union Electric Power Co. v. Sauget, 1 Ill.2d 125, 115 N.E.2d 246, 249 (1953).

X. PURCHASE PRICE OF THE SUBJECT PROPERTY A. [8.30] In General The purchase price of the subject property is admissible if it is current. Department of Public Works & Buildings v. Bloomer, 28 Ill.2d 267, 191 N.E.2d 245 (1963); Department of Conservation v. Aspegren Financial Corp., 72 Ill.2d 302, 381 N.E.2d 231, 21 Ill.Dec. 153 (1978). This evidence is very effective because it involves a market transfer of the very property involved; a purchase five and one-half years before the valuation date has been upheld (Metropolitan Sanitary District of Greater Chicago v. Industrial Land Development Corp., 121 Ill.App.2d 393, 257 N.E.2d 532 (1st Dist. 1970)), as has a purchase four years before the valuation date (Bloomer, supra). A seven-year-old sale of a motel property was denied admission because of time and a substantial increase in market value over that period of time. Department of Transportation of State of Illinois ex rel. People v. Prairie Travler, Inc., 52 Ill.App.3d 799, 368 N.E.2d 144, 10 Ill.Dec. 658 (4th Dist. 1977). A purchase of part of the subject property three years before filing was admitted in Morton Grove Park District v. American National Bank & Trust Company of Chicago, 39 Ill.App.3d 426, 350 N.E.2d 149 (1st Dist. 1976). B. [8.31] Offers Offers to purchase the subject property can be admitted under limited circumstances as set forth in City of Chicago v. Harrison-Halsted Building Corp., 11 Ill.2d 431, 143 N.E.2d 40, 45 (1957):

If an offer for the lands in question is to be received it must meet the tests of the rule established in the Lambert and Lehmann cases. The offer must be made in good faith, by a man of good judgment, acquainted with the value of the real estate and of sufficient ability to pay. It must be for cash and not for credit or in exchange and it must be determined whether made with reference to the fair cash market value of the property or to supply a particular need or fancy. Private offers can be multiplied to any extent, for the purpose of the cause, and the bad faith in which they were made would be difficult to prove. The reception of this kind of evidence stands upon an entirely different footing from evidence of actual sales between individuals or by public auction. The question of admission is one involving the discretion of the court and the decision of the court will not be disturbed unless it is manifestly against the weight of the evidence.



Whether an offer is bona fide is a preliminary question to be decided by the trial court in the exercise of its discretion and will not be disturbed unless it is manifestly against the weight of the evidence. City of Chicago v. Anthony, 136 Ill.2d 169, 554 N.E.2d 1381, 144 Ill.Dec. 93 (1990). An offer to purchase was admitted in Lake County Forest Preserve District v. O’Malley, 96 Ill.App.3d 1084, 421 N.E.2d 980, 52 Ill.Dec. 117 (2d Dist. 1981). The facts of O’Malley are unusual. In that case, the plaintiff put in the offer that was made by the defendant, who was also a valuation witness. In Illinois State Toll Highway Authority v. Dicke, 208 Ill.App.3d 158, 566 N.E.2d 1003, 153 Ill.Dec. 153 (2d Dist. 1991), the appellate court ruled that it was an abuse of the trial court’s discretion to admit evidence of an offer after filing the complaint to condemn for any purpose, including as a basis for the opinion of the expert witness. In County of St. Clair v. Wilson, 284 Ill.App.3d 79, 672 N.E.2d 27, 219 Ill.Dec. 712 (5th Dist. 1996), the court allowed testimony concerning offers to purchase adjacent comparable property. However, this case had a somewhat unusual background in that the expert witnesses for both sides stated that they would have considered them. The case also is notable for its excellent discussion of Federal Rules of Evidence 703 and 705 (see also Illinois Rules of Evidence 703 and 705) in an eminent domain case. XI. [8.32] WILSON v. CLARK AND ITS EFFECT ON ADMISSION OF

COMPARABLE-SALES EVIDENCE As discussed in §§8.16 – 8.31 above, sales evidence can be offered and admitted as substantive evidence. However, evidence of sales can also be placed before the jury to explain the opinions of an expert witness. The use of sales information and related data for this purpose is consistent with the Illinois Supreme Court decision in Wilson v. Clark, 84 Ill.2d 186, 417 N.E.2d 1322, 49 Ill.Dec. 308 (1981), in which there is a detailed discussion of the Federal Rules of Evidence, which have been substantially adopted by the Illinois Supreme Court. Fed.R.Evid. 703 states:

An expert may base an opinion on facts or data in the case that the expert has been made aware of or personally observed. If experts in the particular field would reasonably rely on those kinds of facts or data in forming an opinion on the subject, they need not be admissible for the opinion to be admitted. But if the facts or data would otherwise be inadmissible, the proponent of the opinion may disclose them to the jury only if their probative value in helping the jury evaluate the opinion substantially outweighs their prejudicial effect.

Fed.R.Evid. 703 was amended after the decision in Wilson to add additional language that was not included in the Illinois rule. Ill.R.Evid. 703 states:



The facts or data in the particular case upon which an expert bases an opinion or inference may be those perceived by or made known to the expert at or before the hearing. If of a type reasonably relied upon by experts in the particular field in forming opinions or inferences upon the subject, the facts or data need not be admissible in evidence.

Fed.R.Evid. 703 provides for a presumption of nondisclosure of such evidence, which is not in the Illinois rule. Therefore, it is up to the court to decide, pursuant to Ill.R.Evid. 403 (which is very similar to Fed.R.Evid. 403), whether disclosure of the facts or data is appropriate. For an excellent discussion of the interplay of these rules, see Gino L. DiVito, THE ILLINOIS RULES OF EVIDENCE: A COLOR-CODED GUIDE (2016), www.tdrlawfirm.com/assets/downloads/ Illinois_Rules_of_Evidence_Color-Coded_Guide.pdf (case sensitive). Mr. DiVito is a member of the Special Supreme Court Committee on Illinois Evidence. Ill.R.Evid. 705 states:

The expert may testify in terms of opinion or inference and give reasons therefor without first testifying to the underlying facts or data, unless the court requires otherwise. The expert may in any event be required to disclose the underlying facts or data on cross-examination.

The Illinois Supreme Court, in City of Chicago v. Anthony, 136 Ill.2d 169, 554 N.E.2d 1381, 1391, 144 Ill.Dec. 93 (1990), held that “Rule 703 and Rule 705 allow for an expert to express an opinion based on facts or data not admissible in evidence only if the facts or data are of a type reasonably relied upon by experts in the particular field, and are not excluded by another rule of law or a competing policy interest.” The Supreme Court further held “that it is for the circuit court, in the exercise of its discretion, to determine whether the underlying facts or data upon which an expert bases an opinion are of a type reasonably relied upon by experts in the particular field.” 554 N.E.2d at 1389. Anthony has become the standard of admissibility for expert opinions and for the consideration of items relied on by experts in eminent domain cases. Any consideration of the factors to be relied on by an expert in formulating an opinion must be carefully measured with the standards of this case. The trial judge must exercise sound discretion to determine the admissibility of an expert valuation witness’s testimony. Southwestern Illinois Development Authority v. Masjid Al-Muhajirum, 348 Ill.App.3d 398, 809 N.E.2d 730, 733, 284 Ill.Dec. 164 (5th Dist. 2004). As “gatekeeper of expert opinion,” the trial judge may bar expert valuation opinions that are based on improper application of an appraisal methodology. Id. (appraiser properly barred because his appraisal was based on value of various improvements to land that landowner planned to make at some undetermined time in future). See also Department of Transportation of State of Illinois ex rel. People v. Bouy, 69 Ill.App.3d 29, 386 N.E.2d 1163, 1169, 25 Ill.Dec. 499 (4th Dist. 1979) (witness improperly changed capitalization rate in using income method appraisal); Department of Public Works & Buildings of State of Illinois ex rel. People v. Butler, 5 Ill.App.3d 134, 283 N.E.2d 109 (4th Dist. 1972) (in using comparable-sales approach witness and properly value,

http://www.tdrlawfirm.com/assets/downloads/%0bIllinois_Rules_of_Evidence_Color-Coded_Guide.pdf

http://www.tdrlawfirm.com/assets/downloads/%0bIllinois_Rules_of_Evidence_Color-Coded_Guide.pdf



property taken as bare land rather than part of whole improved property); City of Chicago v. Giedraitis, 14 Ill.2d 45, 150 N.E.2d 577, 580 – 581 (1958) (witness improperly arrived at his valuation opinion by considering land and building separately and based his computations on possible future rental income). At trial, and even before trial, these matters should be handled with an appropriate motion in limine to prevent opposing experts from testifying about facts or data that do not meet the standard of Wilson, supra, and Anthony, supra. Specifically, counsel opposing the introduction of such testimony should be prepared through prior investigation, depositions, or discovery to show the trial court that the information on which the expert bases his or her opinion should not be disclosed to the jury. Specifically, the hearing on the motion in limine should, of course, be out of the presence of the jury and should be carefully planned to prove to the trial court that the expert’s reliance on certain items is either inappropriate or legally insufficient based on the above cases. For example, an expert would normally be expected to rely on and consider information about sales of comparable property. However, an expert would not normally rely on information concerning sales that were clearly not comparable, were for assemblage purposes, were to an entity with the power of eminent domain, or did not reflect market value for other reasons. However, once the testimony about underlying facts or data, including comparable sales, meets the standard of being of a type reasonably relied on by experts in the field, the testifying expert can then explain the sale to the jury in just as much detail and certainty as though the sale itself had been introduced as substantive evidence. It is therefore left to opposing counsel to make certain that the jury understands that this testimony is admissible only for explaining the witness’s testimony and giving weight to the opinion of that expert. It may be appropriate that an instruction be given by the trial court contemporaneously with the testimony or later, when the jury is instructed on the law, so that the jury’s attention is directed to the fact that this evidence is being admitted for a limited purpose. This topic is also discussed in §8.46 below. Counsel should also always object to disputed evidence when it is first offered, especially if a motion in limine was denied. Failure to object waives the right to raise the issue on appeal. Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 163 Ill.2d 498, 645 N.E.2d 896, 206 Ill.Dec. 644 (1994). XII. [8.33] CONCLUSION REGARDING SALES EVIDENCE There is no substitute for analyzing all the sales in the case as to the facts and applicable law. Each case has unique sales with facts the attorney must be prepared to present to the judge and possibly the jury. Similarly, counsel must determine whether it is appropriate to use substantive evidence of the sales for their greatest probative effect or to elicit the evidence (albeit for a limited purpose) through testimony of an opinion witness.



XIII. DEMONSTRATIVE EVIDENCE — MAPS, PLATS, AND PHOTOGRAPHS A. [8.34] Depicting Existing Conditions In almost every eminent domain proceeding, parties stipulate to some photographs, plats, or surveys that depict the condition of the subject property. A plat, map, or photograph that fairly and accurately depicts the property is admissible to explain a witness’s testimony, to illustrate a particular situation, or to enable the jury to understand the facts. Department of Public Works & Buildings v. Chicago Title & Trust Co., 408 Ill. 41, 95 N.E.2d 903 (1950). The plans of a condemning authority showing proposed construction are admissible to illustrate the nature of the improvement and to ascertain damages to the remainder. However, these plans are usually voluminous and may contain information that is irrelevant or misleading. Counsel should be scrupulous in checking each page of the plans before the plans are admitted into evidence. It may be most appropriate to have only a portion of the plans actually admitted into evidence and published to the jury. Aerial photographs showing the property before and after the improvement are admissible. Photographs of comparable-sales properties are admissible and useful, especially since the jury will not view the comparable-sales parcels. The use of Google Maps to show the subject property as well as the surrounding area can be very helpful to show the proximity of comparable sales and other areas of interest. The jury will view the property, and, in addition, some photographic evidence is helpful. It is within the court’s discretion to limit photographic evidence. Id. If a drawing, map, model, chart, or other tangible item to be used for illustrative purposes does not aid in understanding by reason of inaccuracies, the exhibit is properly excluded. Forest Preserve District of DuPage County, Illinois v. Harris Trust & Savings Bank, 108 Ill.App.2d 65, 247 N.E.2d 188, 193 – 194 (2d Dist. 1969). See also Michael H. Graham, GRAHAM’S HANDBOOK OF ILLINOIS EVIDENCE §401.7 (10th ed. 2010). Developments in the use of computers to design and project how a scene will appear after an improvement is constructed could, with appropriate foundation testimony, be used to explain issues concerning damages to the remainder after taking. B. [8.35] Depicting Proposed Highest and Best Use At first glance, the law appears to be inconsistent regarding the admission of plats or drawings depicting a proposed highest and best use. In Forest Preserve District of Cook County v. South Holland Trust & Savings Bank, 38 Ill.App.3d 873, 349 N.E.2d 689 (1st Dist. 1976), the court allowed in evidence a land plan showing the subject property used as a planned unit development with 610 family units, a golf course, a clubhouse, and various ponds. The court also approved admission of a model of a sample dwelling unit. These exhibits explained the testimony concerning a planned unit development and use of floodplain land.



In Forest Preserve District of Cook County v. Tabin, 115 Ill.App.2d 267, 253 N.E.2d 99 (1st Dist. 1969), the court allowed in evidence a proposed plat of subdivision also showing the proposed use of floodplain land. In Forest Preserve District of DuPage County, Illinois v. Kelley, 69 Ill.App.3d 309, 387 N.E.2d 368, 25 Ill.Dec. 712 (2d Dist. 1979), the court affirmed admission of photographs of other developments in the area since the purpose was to illustrate testimony of the experts regarding highest and best use. In Department of Conservation of State of Illinois ex rel. People v. First National Bank of Lake Forest, 36 Ill.App.3d 495, 344 N.E.2d 11, 16 (2d Dist. 1976), the defendants’ proposed plat of subdivision was denied admission. It should be noted that a careful reading of the facts shows that the plat in question did not explain the valuation testimony since the proposed rezoned use did not affect it. Similarly, in Department of Conservation of State of Illinois v. Aspegren Financial Corp., 47 Ill.App.3d 118, 361 N.E.2d 635, 5 Ill.Dec. 312 (2d Dist. 1977), aff’d, 72 Ill.2d 302 (1978), the court affirmed denial of a plat depicting a proposed use since it did not explain an opinion of value. All of the defendant’s valuation witnesses had testified to a highest and best use under the existing zoning. In Park District of Highland Park v. LaSalle National Bank, 36 Ill.App.3d 146, 343 N.E.2d 186 (2d Dist. 1976), the trial court was reversed for admission of a plat of subdivision. This plat did not explain the testimony since both sides agreed that the highest and best use was for single-family homes. More importantly, the plat did not conform to existing subdivision law, and the trial court, rather than the jury, should have determined this question of law. See also Lake County Forest Preserve District v. Vernon Hills Development Corp., 85 Ill.App.3d 241, 406 N.E.2d 611, 40 Ill.Dec. 605 (2d Dist. 1980). In Lake County Forest Preserve District v. Frecska, 85 Ill.App.3d 610, 407 N.E.2d 137, 40 Ill.Dec. 906 (2d Dist. 1980), the court allowed a proposed plan of highest and best use for commercial purposes. In that case, the highest and best use was at issue since the condemning authority denied a possible commercial use. These cases can be reconciled. Exhibits depicting a proposed use may be admitted when the exhibits explain technical and opinion evidence, such as the use and value of floodplain development or any conflicting theories of highest and best use that affect valuation. On the other hand, if there is no conflict as to highest and best use, if no valuation opinion is explained by the exhibit, or if the exhibit is legally unfeasible, the courts may deny admission. Such an exhibit will not aid the jury to determine compensation. In view of the court’s holding in Department of Transportation v. HP/Meachum Land Limited Partnership, 245 Ill.App.3d 252, 614 N.E.2d 485, 185 Ill.Dec. 351 (2d Dist.), appeal denied, 152 Ill.2d 557 (1993), an exhibit may be very useful for explaining an expert’s opinion when there are different highest and best uses for different portions of a tract of property. In this



case, the court held that when the highest and best use of property is not uniform throughout the tract, an appraiser may testify to a highest and best use for different portions of the full tract. Practicing attorneys should consult valuation witnesses and land planners carefully before having any highest-and-best-use exhibits prepared. The attorney should be sure that the appraiser feels that the exhibit depicts the highest and best use and that it explains his or her opinion of value. (Of course, if a variance or rezoning may be necessary, the attorney should be aware of that fact before trial and be prepared to show a reasonable probability for change.) In cases in which highest and best use, floodplain, or rezoning is at issue, a carefully prepared land plan is essential. Admission into evidence requires a careful reading of all cases and close working between the attorney and his or her experts. XIV. PRESENTING VALUATION WITNESSES A. [8.36] For a Total Taking S.Ct. Rule 213 has significantly changed the duties of a party to disclose the conclusions and opinions of opinion witnesses and the bases for those conclusions and opinions. Less than scrupulous compliance with the exacting standards regarding disclosure of the conclusions and opinions of all opinion witnesses and the bases therefore, combined with the duty to seasonably supplement or amend any prior answers or responses, may result in the opinion of a valuation witness being excluded. See Department of Transportation, State of Illinois v. Crull, 294 Ill.App.3d 531, 690 N.E.2d 143, 228 Ill.Dec. 834 (4th Dist. 1998). This case is also notable for its forceful statements that counsel is under no duty to point out the weaknesses in the other party’s case. The Illinois courts have applied liberal standards in determining who may give an opinion of value. Attorneys can select people with varying backgrounds to give opinions of value. Some examples of possible valuation witnesses, other than professional appraisers, include local brokers, developers, or builders. B. [8.37] The Owner as a Valuation Witness In Department of Transportation of State of Illinois ex rel. People v. Harper, 64 Ill.App.3d 732, 381 N.E.2d 843, 845, 21 Ill.Dec. 516 (5th Dist. 1978), the appellate court addressed for the first time whether a landowner can give valuation testimony in an eminent domain case. Finding no Illinois cases that discuss whether a landowner can testify to the fair cash market value of his or her property in a condemnation proceeding, the Harper court looked to what is done in other jurisdictions. The court found authority in many jurisdictions “for the proposition that no preliminary showing of a landowner’s knowledge of real estate values” is necessary before his or her valuation testimony is admissible. Id. The court quoted the following from a North Dakota case:



[A landowner’s] qualification to testify does not depend upon presumption, but upon the principle that an owner is in law qualified to testify, and his testimony is, because of his relationship as owner, competent and admissible on the question of value of his property. His ownership, regardless of his knowledge, qualifies him to testify. Id., quoting McCaffery v. Northern Pac. Ry., 22 N.D. 544, 134 N.W. 749, 750 (1912).

The court quoted the following from an Arizona case: “[I]t is well established law that an owner of property is always competent to testify as to its value.” 381 N.E.2d at 845, quoting State of Arizona v. Lopez, 8 Ariz.App. 61, 442 P.2d 884, 886 (1968). On the other hand, the Harper court found authority in other jurisdictions that held “that ownership does not qualify a person to testify to the value of real estate unless he is familiar with the property values in the area.” 381 N.E.2d at 846. According to the Harper court:

These jurisdictions, in effect, create a two-part test of the owner’s competency to testify: (1) a familiarity with the character and extent of his holdings and (2) a knowledge of property values in the area. Generally, the qualifications of the landowner would have to be shown before he could express his opinion of market values. Id., citing Commonwealth of Kentucky, Department of Highways v. Fister, 373 S.W.2d 720, 722 – 723 (Ky.App. 1963).

The Harper court neither accepted completely the proposition that a landowner is always competent to testify to the value of his or her property nor the proposition that foundation evidence of knowledge of market values in the area is a prerequisite to admissibility of an owner’s testimony. Instead, the court chose “an intermediate or compromise position,” agreeing “in essence” with the following:

[T]he owner of land taken is generally held to be qualified to express his opinion of its value merely by virtue of his ownership. He is deemed to have sufficient knowledge of the price paid, the rents or other income received, and the possibilities of the land for use, to have a reasonably good idea of what it is worth. The weight of his testimony is for the jury. 381 N.E.2d at 846, quoting 5 Nichols, THE LAW OF EMINENT DOMAIN § 18.4[2] (rev. 3d ed. 1969).

Harper merely establishes a lower bar for a landowner to cross over to be qualified to testify to value opinions in a condemnation case. For a land owner to offer value opinions as to the taking is one thing. However, many cases involve damages to the remainder. In Department of Transportation of State of Illinois ex rel. People v. Jones, 44 Ill.App.3d 592, 358 N.E.2d 402, 405, 3 Ill.Dec. 235 (5th Dist. 1976), the court held that “[c]omputation of the fair market value of a remainder requires considerable expertise and thus is a determination reserved for professional appraisers, not for the jury,” which seems to indicate that in some cases a land owner would not be qualified to testify as to damages to the remainder. According to the Illinois Supreme Court, “although any qualified individual may state his opinion as to the property value, there must be some preliminary showing of the factors upon



which such opinion is based.” City of Chicago v. Giedraitis, 14 Ill.2d 45, 150 N.E.2d 577, 580 (1958). See also Department of Public Works & Buildings of State of Illinois ex rel. People v. Greenwell, 45 Ill.App.3d 159, 359 N.E.2d 780, 783 – 784, 3 Ill.Dec. 921 (5th Dist. 1977). When improper elements of damage have been considered, the witness’s testimony is incompetent and upon motion must be stricken. Giedraitis, supra, 150 N.E.2d at 580. “This rule applies where the valuation opinion in a condemnation proceeding is based in part upon proper and in part upon improper elements of damages.” Greenwell, supra, 359 N.E.2d at 783. See also Trunkline Gas Co. v. O’Bryan, 21 Ill.2d 95, 171 N.E.2d 45, 48 – 49 (1960) (“[W]here a witness has considered improper elements of damage, his testimony will be deemed incompetent . . ., even though in part based upon proper elements.” [Citations omitted.]) There is no exception to this rule of incompetency for a landowner. At issue in Trunkline was the trial court’s exclusion of five defense valuation witnesses, including two of the landowners who sought to give testimony on their own behalf. The Illinois Supreme Court opined “that the trial court committed an abuse of discretion when it measured the competency of the [landowners] in terms of experience under identical conditions.” 171 N.E.2d at 48. However, the question remained “whether the testimony of these witnesses, and the three remaining witnesses, was properly refused because their opinions as to value were based upon remote, speculative and improper elements of damage.” Id. After discussing a few elements considered by the witnesses that it deemed improper, the Trunkline court concluded that the testimony of the defendants’ witnesses, including the testimony of two of the landowners, was properly excluded. 171 N.E.2d at 50. In Department of Transportation v. White, 264 Ill.App.3d 145, 636 N.E.2d 1204, 201 Ill.Dec. 772 (5th Dist. 1994), the appellate court addressed the plaintiff’s contention that the trial court erred in allowing the landowner’s testimony because he relied on improper factors. The court began by noting that “[g]enerally, the owner of land is qualified to express an opinion of its value merely by virtue of his ownership.” 636 N.E.2d at 1209, citing Harper, supra. Nevertheless, the court continued on and addressed whether the landowner-witness considered improper factors. 636 N.E.2d at 1209 – 1211. According to the Harper, supra, court, the party objecting to the landowner’s testimony can use the tool of cross-examination “to expose any erroneous basis for valuing the property.” 381 N.E.2d at 846. See also White, supra, 636 N.E.2d at 1209; Hill v. Ben Franklin Savings & Loan Ass’n, 177 Ill.App.3d 51, 531 N.E.2d 1089, 1092 – 1093, 126 Ill.Dec. 462 (2d Dist. 1989). However, cross-examination during trial is no longer the only method for exposing an owner’s erroneous basis for valuing the property. Subsequent to Harper, White, and Hill, S.Ct. Rule 213 was amended to require discovery disclosures relating to any witnesses who are going to offer opinion testimony at trial. Since the landowner’s opinions of value are admissible as lay witness opinion testimony (Department of Transportation ex rel. People v. Central Stone Co., 200 Ill.App.3d 841, 558 N.E.2d 742, 749, 146 Ill.Dec. 779 (4th Dist. 1990)), disclosures relating to an owner’s opinions as to the value of his or her land are required under Rule 213. S.Ct. Rule 213(f)(1). Improper bases for a landowner’s opinions of value may be revealed in Rule 213 disclosures. Improper bases for a landowner’s opinions of value may also be revealed in a discovery deposition.



The reason for the substantive inadmissibility of the elements of damages on which a valuation witness relies must be considered by the court. City of Chicago v. Anthony, 136 Ill.2d 169, 554 N.E.2d 1381, 1389, 144 Ill.Dec. 93 (1990). If another rule of law applicable to the case excludes the element of damages sought to be relied on by the witness, the information may not be permitted to come before the jury under the guise of a basis for the opinion of the witness. Id. Eminent domain law controls the admissibility of evidence for its truth as well as for the limited purpose of explaining the basis of a witness’s valuation opinion. Id. What the Anthony court said about expert witnesses is equally applicable to other valuation witnesses:

The proper factors which may be taken into consideration in determining just compensation must be determined by the trial court as a question of law. . . . An expert . . . may only rely upon facts or data which are legally relevant to the issue of the fair cash market value of the property in question. To the extent that an expert relies upon facts or data which are irrelevant to proving the fair cash market value of the property in question, then the facts or data so relied upon would not be based upon lawful elements of damage and would be of no benefit to a jury. Illinois Power & Light Corp. v. Talbott (1926), 321 Ill. 538, 544, 152 N.E. 486. [Citation omitted.] Id.

In Illinois Power & Light Corp. v. Talbott, 321 Ill. 538, 152 N.E. 486, 488 (1926), the Illinois Supreme Court made it very clear that “[o]nly such opinions as are based on evidence of lawful elements of damage can be of benefit to a jury in the assessment of the amount of damage.” [Emphasis added.] Valuation opinions of witnesses based on elements of damage that are not recognized by the law as proper to be considered in condemnation proceedings should be excluded. Id. Valuation opinions based on improper elements are incompetent and must be excluded even if also based in part on proper elements. Trunkline, supra, 171 N.E.2d at 48 – 49 (“[W]here a witness has considered improper elements of damage, his testimony will be deemed incompetent . . . even though in part based upon proper elements.” [Citations omitted.]). C. [8.38] Sample Questions for Valuation Witness The following are questions that may be used to qualify a hypothetical real estate valuation witness. Questions regarding qualifications are included that may be applicable to witnesses with varying backgrounds. An attorney must consult with the valuation witness to determine which questions will bring forth the best qualifications for that witness. 1. Please state your name and address. 2. What is your occupation? 3. What is your general educational background? 4. What is your employment history (duties and responsibilities)? 5. Where are you employed presently? 6. Please identify your position and your duties and responsibilities.



7. Are you associated with other appraisers? 8. How long have you been so employed? 9. What courses and training in real estate appraisal have you taken? 10. Have you taught any real estate appraisal courses? 11. Have you taught any continuing education courses? 12. Are you a member of any professional associations? 13. Have you been an officer of any professional association? 14. Do you have any professional designations (e.g., a member of the Appraisal Institute)? 15. Please identify them. 16. Describe the requirements for this designation. 17. What licenses do you hold, in what states, and when were you so licensed? 18. What are the requirements for these licenses? 19. How long have you appraised real estate? 20. Where have you appraised real estate? 21. For what purposes have you appraised real estate? 22. For what types of entities have you appraised real estate? 23. Approximately how many parcels of real estate have you appraised? 24. Have you testified in court before? 25. Approximately how many times have you testified in court? 26. Have you appraised property in [this area], Illinois, and particularly in [county], Illinois? 27. Are you familiar with property values in [this area], Illinois, and [county], Illinois? 28. Have you appraised any property in this immediate area? 29. What are those properties?



30. Are you a licensed real estate broker? 31. How long have you been so licensed? 32. What type of properties have you sold? 33. Have you sold as a broker any properties in the area of the subject property? 34. Are you familiar with the property being condemned? [Specifically identify the legal description and tie this evidence to the legal descriptions in the complaint.] 35. Have you inspected this property, and, if so, on what dates? 36. Was the landowner or a representative present with you when you inspected the property? 37. Did you make an appraisal of this property? 38. What are the Uniform Standards of Professional Appraisal Practice? 39. Please explain the Uniform Standards of Professional Appraisal Practice. 40. Does the appraisal you made comply with the Uniform Standards of Professional Appraisal Practice? 41. Who hired you to make that appraisal? 42. What steps did you take in appraising the property? 43. What contact did you have with the owner? 44. What is the market analysis? 45. Did you put the market analysis together by yourself? 46. What steps did you take in putting together the market analysis? 47. After completing the market analysis, what steps did you take to appraise the subject property? 48. Please describe this property: (Make sure the appraiser specifically describes the whole property, the part taken, and the remainder.) What is the general appearance? What are the improvements?



What is the neighborhood? What is the topography? What is the zoning? Is it within or outside the city limits? What utilities are available? 49. Identify and describe pictures of the property. [Does this exhibit fairly and accurately portray this property as of the date of taking? Move to admit as an exhibit.] 50. Please explain the definition of the term “highest and best use.” 51. Do you have an opinion as to the highest and best use of the subject property as of [date of filing]? 52. What is your opinion of the highest and best use of the subject property? 53. What factors did you consider in arriving at that opinion? [optional] 54. Please give the definition of “fair cash market value.” 55. Do you have an opinion of the fair cash market value of the subject property at its highest and best use as of [date of filing]? 56. What is your opinion of the fair cash market value of the subject property as of [date of taking]? 57. What factors did you consider in arriving at that opinion? [optional] 58. What is a “comparable sale”? 59. Is it normal and customary for appraisers to consider comparable sales in reaching opinions of value? 60. In your opinion, are the sales that you have considered comparable to the subject property? 61. Please identify the sales you considered to be comparable sales. Who was the seller/buyer? What was the date of sale?



How far from [the subject property] is it located? On what kind of road is it located? What is the topography? What is the size? What is the highest and best use? What utilities are available? What is the neighborhood? Is it within or outside city limits? What is the zoning? For how much did it sell? Why, in your opinion, is this sale comparable? An attorney should develop questions to emphasize the main points in his or her client’s case. In addition, an appraiser may give rebuttal opinions in several areas. If the parties differ on issues such as rezoning, highest and best use, or sales evidence, the witness might be asked to explain why he or she does not agree with the opponent’s expert. If more than one valuation witness will testify, the direct testimony of later witnesses should be shortened. The jury will be bored by having the property described repeatedly. D. [8.39] Partial Taking with Damages to the Remainder When dealing with a partial taking with damages to the remainder, the witness would be qualified in the same manner as outlined in §8.38 above, except that since a second valuation is involved (the remainder after the take), an inquiry as to appraisals or experience with properties similarly affected may be necessary. The questions necessary to elicit opinions would be as follows: 1. Do you have an opinion of the fair cash market value of the entire subject property (e.g., Parcel No. ________) at its highest and best use as of [date of filing]? 2. Do you have an opinion of the fair cash market value of the property sought to be taken, namely, the real estate described on [exhibit identification], for example, as part of the whole at its highest and best use as of [date of filing]? [Assume highest and best use is the same for the whole and the part taken. If not, the witness should be questioned on that part.]



3. What is that opinion? 4. What factors did you consider? [optional] 5. Do you have an opinion of the fair cash market value of the remainder as part of the whole before the taking at its highest and best use as of [date of filing]? 6. What is that opinion? 7. Do you have an opinion of the fair cash market value of the remainder after the taking? 8. What is that opinion? [If the highest and best use of the remainder changes as a result of the taking, then you should elicit an opinion as to the highest and best use of the remainder after the taking as of the date of filing.] 9. Are there damages to the remainder? 10. What is the amount of damage to the remainder? 11. What factors did you consider in determining the damages to the remainder? 12. What factors did you consider in arriving at these opinions? [optional] 13. Do you have an opinion of the highest and best use of the remainder after the taking as of [date of filing]? 14. What is that opinion? 15. What factors did you consider? [This is optional and would be used only if the highest and best use is changed.] 16. What is a “comparable sale”? 17. Is it normal and customary for appraisers to consider comparable sales in reaching opinions of value? 18. In your opinion, are the sales that you have considered comparable to the subject property? 19. Please identify the sales you considered to be comparable sales. Who was the seller/buyer? What was the date of sale? How far from [the subject property] is it located?



On what kind of road is it located? What is the topography? What is the size? What is the highest and best use? What utilities are available? What is the neighborhood? Is it within or outside city limits? What is the zoning? For how much did it sell? Why, in your opinion, is this sale comparable? XV. [8.40] RIGHT TO OPEN AND CLOSE S.Ct. Rule 233 states generally that the parties shall proceed at all stages of the trial in the order in which they appear in the pleadings unless otherwise agreed by the parties or ordered by the court. This rule applies in eminent domain cases with one major exception. In a case in which the landowner claims damages to the remainder as a result of the taking, the landowner may, before trial, file a motion pursuant to Rule 233 for authority for the defendant-landowner to proceed first at all stages of the trial. In that situation, the trial court, in the exercise of sound judicial discretion, may grant the motion and allow the defendant-landowner to proceed first. The foundational case in this regard is Department of Business & Economic Development v. Brummel, 52 Ill.2d 538, 288 N.E.2d 392 (1972). In Commonwealth Edison Co. v. Danekas, 104 Ill.App.3d 907, 433 N.E.2d 736, 60 Ill.Dec. 694 (2d Dist. 1982), the court stated that the condemnee’s right to proceed first is not absolute and requires affirmative action on the condemnee’s part. In that case, the appellate court found that the motion of the defendant was untimely because it was made after the cutoff date for pretrial motions. Also in that case, the plaintiff’s counsel stated that they were prepared to proceed first and were taken by surprise by the motion. The defendant’s counsel should carefully analyze the proof to be elicited on both the question of the property taken and the issue of damages to the remainder and make a decision on a case-by-case basis as to the best way to proceed. However, as a general rule, the right to argue first in opening and last in final argument to the jury is a significant advantage in any trial. The rule is somewhat different in a case in which there has been a motion and order of preliminary just compensation (quick-take). In Department of Public Works & Buildings v.



Dixon, 37 Ill.2d 518, 229 N.E.2d 679 (1967), the Illinois Supreme Court held that a landowner, in a case in which title had vested in the condemnor by use of the quick-take statute and in which damages to property not taken were claimed by the condemnee, had the right to open and close argument. This case was extended in Department of Public Works & Buildings of State of Illinois ex rel. People v. Tinsley, 120 Ill.App.2d 95, 256 N.E.2d 124 (5th Dist. 1970), in which the court stated that if a landowner avails himself or herself of the right to open and close he or she must do so at all stages of the proceeding. Accordingly, in a case involving a quick-take statute, it would generally avail the defendant to request the authority to proceed first at all stages of the trial. XVI. JURY INSTRUCTIONS A. [8.41] In General Jury instructions in eminent domain cases are usually simple and straightforward. In addition to the usual cautionary instructions, there will be instructions involving the issues in the case, the measure of damages, definitions, and the form of the verdict. Instructions in an eminent domain case typically will consist of 1. a cautionary instruction (Illinois Pattern Jury Instruction — Civil No. 1.01[3], as

modified by I.P.I. — Civil No. 300.01 (I.P.I. — Civil)); 2. an issue instruction (I.P.I. — Civil Nos. 300.10 through 300.24); 3. if the fact of damages to the remainder is contested, a burden of proof instruction (I.P.I.

— Civil Nos. 300.31 through 300.32); 4. a measure of damages instruction (I.P.I. — Civil Nos. 300.44 through 300.60); 5. the range of verdict instruction (I.P.I. — Civil No. 300.61); 6. the appropriate definitions (I.P.I. — Civil Nos. 300.80 through 300.87); and 7. a verdict form instruction (I.P.I. — Civil Nos. 300.70 through 300.76.1). B. [8.42] Cautionary Instructions The cautionary instructions in an eminent domain case are almost identical to those of any other case. The only differences involve those areas that are unique to an eminent domain trial. For example, I.P.I. — Civil No. 1.01[3] is modified by I.P.I. — Civil No. 300.01 (replacing the third sentence by adding the element of the view of the property by the jury). Obviously, if the jury does not view the property, then I.P.I. — Civil No. 1.01 should be used without modification. The modified sentence as shown in I.P.I. — Civil No. 300.01 states:



Evidence consists of testimony of the witnesses, exhibits admitted by the court and your view of the property. [Emphasis added.]

I.P.I. — Civil No. 1.01[3] should be modified to correctly describe the condemning authority. C. [8.43] Definitional Instructions Almost all eminent domain cases will include the following definitional instructions: 1. just compensation (I.P.I. — Civil No. 300.80); 2. fair cash market value (I.P.I. — Civil No. 300.81); and 3. highest and best use (I.P.I. — Civil No. 300.84). D. [8.44] Rezoning An instruction on the effect of a possible change in zoning was published in response to the Illinois Supreme Court decision in Department of Public Works & Buildings v. Association of Franciscan Fathers of State of Illinois, 69 Ill.2d 308, 371 N.E.2d 616, 13 Ill.Dec. 681 (1977). In this case, the Supreme Court held that the trial judge erred by not giving an instruction concerning the reasonable probability of rezoning. Obviously, a parcel of unimproved land could have much more value if it was zoned in such a way to permit immediate development. The instruction is given with I.P.I. — Civil No. 300.85 and states:

If you find that on insert date complaint was filed there was a reasonable probability of rezoning the property, then you may consider the effect of such rezoning in determining just compensation in this case.

The landowner’s attorney will want to establish that the highest and best use of the subject property on the date of taking is one that results in a larger fair cash market value. Obviously, a piece of property that is valued with the highest and best use as commercial will be worth more than the same piece of property valued with the highest and best use as farmland. Testimony of a fairly technical nature, perhaps from the zoning department of the relevant municipality, generally would be sufficient to connect this issue with valuation testimony and to justify the use of this instruction. There is an excellent discussion of the factors to be considered regarding whether testimony should be allowed as to a reasonable probability of rezoning in Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 250 Ill.App.3d 665, 619 N.E.2d 1321, 189 Ill.Dec. 272 (2d Dist. 1993), aff’d, 163 Ill.2d 498 (1994). The trial court first must make a preliminary determination as a matter of law, by way of an in camera hearing, that there is sufficient evidence to present the testimony of values based on such a probability. Relevant factors include the character of the neighborhood, the rezoning of the nearby property, the change



in use patterns, demand for certain uses, growth patterns, comparable sales, characteristics of the property, and the age of current zoning ordinances. Interestingly enough, such evidence cannot be used in an attempt to establish the exact classification of the reasonably probable zoning. See Morton Grove Park District v. American National Bank & Trust Company of Chicago, 39 Ill.App.3d 426, 350 N.E.2d 149 (1st Dist. 1976). E. [8.45] Stipulations and Agreements There is an interesting area of the law in eminent domain cases with respect to a unilateral stipulation by the condemning authority. The purpose of such a stipulation, which usually takes the form of a statement by the plaintiff’s counsel, is to minimize the effect that the construction of the improvements might have on the defendant’s property. Such a unilateral stipulation is binding. See East Peoria Sanitary Dist. v. Toledo, P. & W. R.R., 353 Ill. 296, 187 N.E. 512 (1933). This type of stipulation can be quite effective from the point of view of the condemnor. I.P.I. — Civil No. 300.52 states:

The stipulation made by the plaintiff and read to you is a binding obligation which plaintiff-condemnor must perform. You are not to allow damages because of any possibility that the stipulation might not be performed.

The parties may also agree about certain items of damage. I.P.I. — Civil No. 300.53 states:

Plaintiff and defendant have agreed that plaintiff will pay and defendant will accept specific sums for the following items of damage which will be caused by construction of the proposed public improvement: [here list the items which have been stipulated to and are no longer elements in the case].

In arriving at your verdict you are not to include any amounts for these items. They will be paid for separately.

F. [8.46] Expert Testimony A comparable sale in an eminent domain case can be admitted as substantive evidence. More commonly, however, experts freely refer to comparable sales that have not been admitted to explain the basis for their testimony. This distinction is critical. In view of the Illinois Supreme Court’s decisions in Wilson v. Clark, 84 Ill.2d 186, 417 N.E.2d 1322, 49 Ill.Dec. 308 (1981), and City of Chicago v. Anthony, 136 Ill.2d 169, 554 N.E.2d 1381, 144 Ill.Dec. 93 (1990), counsel should be ready to request a limiting instruction at the time the evidence is offered that the evidence is being offered for the limited purpose of evaluating the basis for the expert’s opinion. See Comment, I.P.I. — Civil No. 2.04; Comment, I.P.I. — Civil No. 300.03.



XVII. [8.47] CLOSING ARGUMENT The order of the closing argument by a party will be controlled by the court’s ruling as to which party has the right to open and close the case, which is discussed in §8.40 above. The importance of the closing argument in an eminent domain case has increased due to the Supreme Court’s decisions in Wilson v. Clark, 84 Ill.2d 186, 417 N.E.2d 1322, 49 Ill.Dec. 308 (1981), and City of Chicago v. Anthony, 136 Ill.2d 169, 554 N.E.2d 1381, 144 Ill.Dec. 93 (1990). As a result of the many detailed and perhaps confusing sales described to the jury by the opinion witnesses for both parties, the jury will welcome a thoughtful analysis by counsel of these comparable sales. The closing argument is the opportunity for counsel to use the power of persuasion to focus on the facts, relate them to the opinions of the witnesses, and convince the jury in favor of counsel’s position.


Mandamus and Inverse Condemnation JOSEPH B. VANFLEET VanFleet Law Offices Peoria

The contribution of Emily H. Wilburn to the previous edition of this chapter is

gratefully acknowledged

9



I. [9.1] Background II. [9.2] Illinois Constitution Provisions Related to Property Rights III. Mandamus: Compelling the Government To Act A. [9.3] Historic Use of Mandamus B. [9.4] Only for Use in Cases in Which the Government Physically Takes Property C. [9.5] Mandamus Is Not Proper When State Has a Record Interest in the Property IV. Suits for Money Damages A. [9.6] The Only Option for Property That Has Been Damaged but Not Taken B. [9.7] State Is Last in Line To Pay V. [9.8] Federal Jurisdiction of Inverse Condemnation Claims VI. [9.9] Specific Inverse Condemnation Cases A. [9.10] Flooding/Water Invasion B. [9.11] Loss of Road Access C. [9.12] Regulatory Takings VII. [9.13] Conclusion

MANDAMUS AND INVERSE CONDEMNATION §9.2


I. [9.1] BACKGROUND Inverse condemnation describes the process by which a property owner recovers compensation from a governmental entity for the taking of its property when condemnation proceedings have not been instituted. Tim Thompson, Inc. v. Village of Hinsdale, 247 Ill.App.3d 863, 617 N.E.2d 1227, 1242 – 1245, 187 Ill.Dec. 506 (2d Dist. 1993). See, e.g., Sorrells v. City of Macomb, 2015 IL App (3d) 140763, 44 N.E.3d 453, 398 Ill.Dec. 424 (trial court’s dismissal affirmed). In the past two decades, obtaining an order of mandamus compelling a governmental entity to institute eminent domain proceedings has been an increasingly difficult proposition. The ability of a plaintiff to compel a governmental entity to institute an eminent domain action for damages to property has been whittled away. In a normal eminent domain proceeding, the condemning body files an appropriate complaint under the Eminent Domain Act, 735 ILCS 30/1-1-1, et seq., to officially take real property from its owners and to determine the amount of “just compensation” that must be paid for the property. See 735 ILCS 30/10-5-5. Property owners often file cross-petitions or counterclaims to recover any damage caused to the remainder of their property not sought to be taken by the condemning body, and that ability remains unchanged. Illinois Department of Natural Resources v. Pedigo, 348 Ill.App.3d 1044, 811 N.E.2d 761, 765, 285 Ill.Dec. 274 (4th Dist. 2004) (“Generally, damages to the remainder are only recognized when the taking of the parcel effectively damages or destroys the principal use for which the remainder was designed.”). Cf. Department of Transportation ex rel. People v. Interstate Brands Corp., 251 Ill.App.3d 785, 623 N.E.2d 771, 191 Ill.Dec. 181 (4th Dist. 1993) (counterclaim for damages in eminent domain action to property not taken must be brought in Court of Claims); Sorrells, supra. When the government takes real property without instituting the procedures required by the Eminent Domain Act, the property owner may seek an order of mandamus to compel the government to commence an eminent domain action. Herget National Bank of Pekin v. Kenney, 105 Ill.2d 405, 475 N.E.2d 863, 86 Ill.Dec. 484 (1985). Cf. Village of Riverwoods v. BG Limited Partnership, 276 Ill.App.3d 720, 658 N.E.2d 1261, 213 Ill.Dec. 240 (1st Dist. 1995) (because state had interest under written conveyance, circuit did not have jurisdiction). See also 735 ILCS 30/10-5-65. If the governmental entity damages the property owner’s property, the property owner must file suit to recover money damages. Patzner v. Baise, 133 Ill.2d 540, 552 N.E.2d 714, 142 Ill.Dec. 123 (1990). This chapter gives an overview of the constitutional provisions on which these rights depend, the remedy of mandamus versus suits for money damages, and examples of common scenarios in inverse condemnation proceedings. II. [9.2] ILLINOIS CONSTITUTION PROVISIONS RELATED TO PROPERTY

RIGHTS The provision of the Illinois Constitution related to the government’s power of eminent domain has changed over the years. This provision of the Constitution protects property owners and the government alike. The 1848 Illinois Constitution provided that no person’s property

shall . . . be taken or applied to public use without the consent of his representatives



in the general assembly, nor without just compensation being made to him. ILL.CONST. (1848) art. XIII, §11.

The 1870 Illinois Constitution amended this provision to read:

Private property shall not be taken or damaged for public use without just compensation. Such compensation, when not made by the state, shall be ascertained by a jury, as shall be prescribed by law. The fee of land taken for railroad tracks, without consent of the owners thereof, shall remain in such owners subject to the use for which it is taken. ILL.CONST. (1870) art. II, §13.

In Rigney v. City of Chicago, 102 Ill. 64, 71 – 82 (1882), the Illinois Supreme Court held that the above provision in the 1870 Illinois Constitution, which added the words “or damaged” was meant to provide compensation to property owners who had suffered great hardship when no actual physical taking of their property had occurred, but access to the property was limited or eliminated, or some other damage to the property occurred so as to destroy the value of the property. The 1970 Illinois Constitution kept the words “or damaged” and states: Private property shall not be taken or damaged for public use without just

compensation as provided by law. Such compensation shall be determined by a jury as provided by law. ILL.CONST. (1970) art. I, §15.

III. MANDAMUS: COMPELLING THE GOVERNMENT TO ACT A. [9.3] Historic Use of Mandamus Mandamus is an equitable civil procedure tool used to obtain a court order to command a governmental body to perform some official ministerial act. Corn Belt Bank v. Cellini, 18 Ill.App.3d 1035, 310 N.E.2d 470, 473 (4th Dist. 1974). Within the realm of eminent domain, caselaw has eroded the efficacy of a petition for mandamus for anything less than a physical taking of property. See Granite City Moose Lodge No. 272 v. Kramer, 96 Ill.2d 265, 449 N.E.2d 852, 855, 70 Ill.Dec. 505 (1983). See also Sorrells v. City of Macomb, 2015 IL App (3d) 140763, 44 N.E.3d 453, 398 Ill.Dec. 424. Before the Court of Claims was created in 1970, mandamus was ordered if a property owner could prove that his or her land had been taken or damaged by the state or some other governmental entity without compensation and that the state or governmental entity had not filed an eminent domain action. The order of mandamus compelled the state or governmental entity to file condemnation proceedings to ascertain the amount of damages suffered by the property owner. People ex rel. First Nat. Bank of Blue Island v. Kingery, 369 Ill. 289, 16 N.E.2d 761 (1938); People ex rel. Haynes v. Rosenstone, 16 Ill.2d 513, 158 N.E.2d 577 (1959). The remedy of mandamus was deemed necessary in both taking and damages cases because the state was immune from suit. If the petitioning property owner was not able to compel eminent domain proceedings, then the property owner would be without remedy, which would render parts of the Illinois Constitution ineffective. See Kingery, supra.



B. [9.4] Only for Use in Cases in Which the Government Physically Takes Property The remedy of mandamus is still available to plaintiffs, but the practical situations in which it might be necessary or even effective are now few and far between. A plaintiff cannot rely on a suit for mandamus to compel a governmental entity to bring an eminent domain suit if the property has been only damaged but not physically taken. See Patzner v. Baise, 133 Ill.2d 540, 552 N.E.2d 714, 142 Ill.Dec. 123 (1990); Granite City Moose Lodge No. 272 v. Kramer, 96 Ill.2d 265, 449 N.E.2d 852, 855, 70 Ill.Dec. 505 (1983); Sorrells v. City of Macomb, 2015 IL App (3d) 140763, 44 N.E.3d 453, 398 Ill.Dec. 424. Mandamus is still available to a property owner whose property has been physically taken to compel the state. Because there is a presumption that the state cannot violate the Constitution, the defendant in mandamus cases is usually a state official or other governmental entity to institute eminent domain proceedings under the Eminent Domain Act. Herget National Bank of Pekin v. Kenney, 105 Ill.2d 405, 475 N.E.2d 863, 865, 86 Ill.Dec. 484 (1985). The nail in the coffin for the remedy of mandamus in cases of property damage — as opposed to physical takings — was the Illinois Supreme Court decision in Patzner, supra. The court in Patzner held that the 1970 Illinois Constitution’s abolition of sovereign immunity and the enactment of the Court of Claims Act, 705 ILCS 505/1, et seq., deprive any court, other than the Court of Claims, of the jurisdiction to hear and determine claims against the State of Illinois related to property damages. 552 N.E.2d at 716. Because the Court of Claims provides property owners whose property has been damaged — but not physically taken — with a remedy, an action in mandamus cannot be sustained. 552 N.E.2d at 717. In Patzner, the plaintiff property owner owned property in Rochelle, Illinois, adjacent and with direct access to U.S. Route 51. The property owner’s real estate office was located on the property. In 1980, the Illinois Department of Transportation commenced a highway improvement project on U.S. Route 51 to construct an overpass. The construction of the overpass destroyed the property owner’s access to the new roadway, although indirect access continued. In his petition for mandamus, Patzner alleged that he had suffered a taking or damaging of his property at the hands of a state officer for two reasons. First, during the construction of the overpass, construction machinery was parked in the parking lot in front of his real estate office, which caused him to relocate his business. Second, the overpass destroyed his access to the new highway and deprived him of light, air, and view. 552 N.E.2d at 715. While the trial court granted the petition for mandamus, the appellate court reversed. The appellate court held that because no physical taking of Patzner’s property occurred, his only remedy against the state officer was in the Court of Claims. The Illinois Supreme Court granted Patzner leave to appeal to answer the question of whether, under the facts presented, a state officer could be compelled by mandamus “to institute an action for eminent domain where there was no physical taking of the plaintiff’s property.” 552 N.E.2d at 716. Patzner argued that under previous decisions, an order of mandamus to compel eminent domain was an available remedy when property had been damaged by the state but not taken. The court disagreed and distinguished earlier cases allowing mandamus in damages cases. The court held that their underlying rationale — that no other remedy was available — was no longer valid.



The court declared, “A remedy is . . . available . . . through the Court of Claims for property owners whose property has been damaged though not taken for public use.” Id. Unlike the law when People ex rel. Haynes v. Rosenstone, 16 Ill.2d 513, 158 N.E.2d 577 (1959), People ex rel. O’Meara v. Smith, 374 Ill. 286, 29 N.E.2d 274 (1940), and People ex rel. First Nat. Bank of Blue Island v. Kingery, 369 Ill. 289, 16 N.E.2d 761 (1938), were decided, “the Court of Claims Act provides a remedy for the property owner whose property is damaged but not taken.” 552 N.E.2d at 716 – 717. The Patzner court noted that “[m]aking the plaintiff’s exclusive remedy lie in the Court of Claims is fully appropriate, for this court has held that, where some other adequate remedy is available, mandamus will not lie.” 552 N.E.2d at 717. Patzner also argued that he possessed a constitutional right to trial by jury for property “taken or damaged for public use.” Id., quoting ILL.CONST. (1970) art. I, §15. The court explained that the constitutional right of trial by jury was modified by the statement “as provided by law.” 552 N.E.2d at 717. The court stated that the General Assembly had provided by law that claims against the state be pursued in the Court of Claims, so the property owner was not constitutionally entitled to a jury. Id. The court suggested that any complaints about the lack of trial by jury should be addressed to the legislature. 552 N.E.2d at 718. Following Patzner, a complaint for mandamus to compel the filing of eminent domain can be filed only in those cases in which property is physically taken for public use without the payment of compensation. See Herget National Bank, supra (mandamus was appropriate because state had physically taken property). C. [9.5] Mandamus Is Not Proper When State Has a Record Interest in the Property The courts examine whether the plaintiff is asking the court to adjudicate a property interest of the state or require the state or a state official to fulfill its constitutional duties. Thus, the court will not grant an order of mandamus to compel eminent domain proceedings when the state is the record titleholder to the land in question. In such a case, the state is the real party in interest, and exclusive jurisdiction of the matter is in the Court of Claims. In Gordon v. Department of Transportation, 99 Ill.2d 44, 457 N.E.2d 403, 75 Ill.Dec. 409 (1983), the Illinois Supreme Court held that mandamus was improperly granted to a property owner who asserted that the state had taken land he had acquired by adverse possession. Because the property owner was asking the court to adjudicate a property interest of the state — i.e., whether the state had lost title to the property due to adverse possession before the alleged taking — exclusive jurisdiction was vested in the Court of Claims. 457 N.E.2d at 404 – 405. The court relied on the fact that the state had a written conveyance, whereas the plaintiff only claimed an interest in the land through adverse possession. Id. But see Flick v. Kramer, 151 Ill.App.3d 836, 503 N.E.2d 811, 104 Ill.Dec. 949 (2d Dist. 1987) (petition for mandamus was premature because plaintiff did not hold clear, unambiguous entitlement to property occupied by state). The Illinois Supreme Court addressed this issue again in Herget National Bank of Pekin v. Kenney, 105 Ill.2d 405, 475 N.E.2d 863, 86 Ill.Dec. 484 (1985). The plaintiff in Herget National Bank was the record title owner of real estate adjacent to a lake. The lake was raised, and the plaintiff’s property was flooded. Approximately 20 years later, the Illinois Department of Conservation drained the lake. While the lake was drained, the plaintiff attempted to have the Department of Conservation purchase the flooded acres. When the Department of Conservation refused, the plaintiff sued for an order of mandamus to compel eminent domain proceedings. The



trial court issued the order, but the appellate court reversed, holding that under Gordon, supra, and Sass v. Kramer, 72 Ill.2d 485, 381 N.E.2d 975, 21 Ill.Dec. 528 (1978), the suit involved a property interest of the state, not the violation of a duty by a state official. Therefore, the appellate court held that jurisdiction for the claim should lie in the Court of Claims. The Supreme Court reversed the appellate court, basing its opinion on the fact that record title had been held by the plaintiff and the flooding constituted “a physical invasion and taking of the property in question.” Herget National Bank, supra, 475 N.E.2d at 865. The court observed that Article I, §15, of the Illinois Constitution not only prohibits the taking or damaging of private property without just compensation but also mandates that such compensation is to be determined by a jury trial. To relegate the landowner to the Court of Claims would abrogate this right. 475 N.E.2d at 866. The dissent, interestingly, pointed out that the court relied on the circuit court’s finding that the state did not have an irrevocable license to flood the land. The dissent also pointed out that because an irrevocable license is a property interest, the circuit court had no jurisdiction to make that determination, and this was a case for the Court of Claims. 475 N.E.2d at 866 – 867 (Goldenhersh, J., dissenting). The property owner in Evans v. Brown, 267 Ill.App.3d 662, 642 N.E.2d 1335, 205 Ill.Dec. 218 (4th Dist. 1994), sought an order of mandamus to compel the Secretary of the Illinois Department of Transportation to file eminent domain proceedings for the alleged taking of a 25-foot strip of property owned by the plaintiff. The state already possessed an easement to use the property for highway purposes by an earlier conveyance. The easement provided that it would revert to the property owner in the event the property either was not used for highway purposes or was used for some other purpose. The property owner asserted that the conditions set forth in the reversion had occurred and thereafter the state had taken her property, entitling her to prosecute an inverse condemnation action. The appellate court affirmed dismissal of the action, holding that resolution of the issue involved an adjudication of a property interest of the state and, under the holding of Gordon, supra, exclusive jurisdiction resided in the Court of Claims. See also Village of Riverwoods v. BG Limited Partnership, 276 Ill.App.3d 720, 658 N.E.2d 1261, 213 Ill.Dec. 240 (1st Dist. 1995) (Court of Claims had jurisdiction over claim because existence of state’s property right became central issue). IV. SUITS FOR MONEY DAMAGES A. [9.6] The Only Option for Property That Has Been Damaged but Not Taken In situations in which the property owner’s land has been damaged but not been physically taken, the property owner’s remedy consists of a suit for money damages rather than forcing the government to adhere to the Constitution. The action at law to recover damages satisfies the constitutional requirement that private property may not be “damaged” for public use without just compensation. People ex rel. Pratt v. Rosenfield, 399 Ill. 247, 77 N.E.2d 697, 700 (1948). In Granite City Moose Lodge No. 272 v. Kramer, 96 Ill.2d 265, 449 N.E.2d 852, 855, 70 Ill.Dec. 505 (1983), the Illinois Supreme Court, quoting Horn v. City of Chicago, 403 Ill. 549, 87 N.E.2d 642, 647 (1949), stated that



an abutting property owner is not entitled to have condemnation proceedings instituted to determine damages to his property occasioned by a public improvement where no part of his property is physically taken and . . . the city or other authorized sovereign constructing such improvement is not required, under the constitution or the Eminent Domain Act or any other law or statute, to institute condemnation or other proceedings to ascertain such damages.

B. [9.7] State Is Last in Line To Pay If property is damaged by a governmental entity other than the state, or even in addition to the state, the owner’s remedy is a lawsuit in the circuit court for money damages. When the state is the only alleged offender, the owner’s remedy is to file an action for damages in the Court of Claims. Furthermore, a property owner cannot begin his or her action for damages for inverse condemnation in the Court of Claims if there is any other governmental entity potentially responsible for the damage. The Court of Claims Act requires that any person who files a claim in the court shall, before seeking final determination of his or her claim, exhaust all other remedies and sources of recovery whether administrative or judicial. 705 ILCS 505/25. This means that a property owner must exhaust his or her remedies against actors other than the state before bringing a claim in the Court of Claims. Id. The practical effect of this procedure is that the state may not be required to compensate the property owner for damaging the property simply because there are other responsible parties whom the property owner must sue first. The equity of such an approach is subject to criticism. See, e.g., Albert J. Horrell, Rights and Remedies of Property Owners Not Proceeded Against, 1966 U.Ill.L.F. 113, 119 – 120. V. [9.8] FEDERAL JURISDICTION OF INVERSE CONDEMNATION

CLAIMS Property owners can invoke the jurisdiction of the federal courts by raising issues under the Fifth Amendment to the U.S. Constitution; these claims will be ripe for the federal court only if the property owner has already availed himself or herself of all state court remedies. Williamson County Regional Planning Commission v. Hamilton Bank of Johnson City, 473 U.S. 172, 87 L.Ed.2d 126, 105 S.Ct. 3108, 3116 (1985). In Williamson County, the U.S. Supreme Court created a special ripeness doctrine for claims arising under the Takings Clause. The Court held that a plaintiff property owner must first seek and have been denied compensation under state court procedures before seeking redress under the federal Takings Clause. See also Murphy v. Village of Plainfield, 918 F.Supp.2d 753, 759 – 760 (N.D.Ill. 2013) (case was not ripe because state court remedies had not been exhausted); Hager v. City of West Peoria, 84 F.3d 865, 869 (7th Cir. 1996) (ripeness doctrine applies to uncompensated takings, inverse condemnation, or due-process damages). The rationale is that the Takings Clause of the Fifth Amendment does not prohibit a governmental taking, but rather prohibits the state from taking property without paying just compensation. Williamson County, supra, 105 S.Ct. at 3121. Plaintiff property owners must use their state procedures to obtain just compensation and be denied before asserting a Fifth Amendment takings claim in federal court. Id.



The Seventh Circuit has adamantly stated that

Federal Courts are not boards of zoning appeals. This message, oft-repeated, has not penetrated the consciousness of property owners who believe that federal judges are more hospitable to their claims than are state judges. Why they should believe this we haven’t a clue; none has ever prevailed in this circuit, but state courts often afford relief on facts that do not support a federal claim. Is it that they have omitted the steps necessary to obtain review in state court and hope for the best in a second-chance forum? Well, we are not cooperating. Litigants who neglect or disdain their state remedies are out of court, period. River Park, Inc. v. City of Highland Park, 23 F.3d 164, 165 (7th Cir.1994).

The Williamson County ripeness doctrine applies to both procedural- and substantive-due-process claims and to equal-protection claims, but it may be avoided if the property owner does not allege a “true” takings claim. Oxford Bank & Trust v. Village of La Grange, 879 F.Supp.2d 954 (N.D.Ill. 2012) (ripeness doctrine not applicable when there is no actual taking alleged because regulations do not deny all beneficial use and bona fide equal-protection exception). In Oxford Bank, the court concluded that the plaintiff had not alleged a “taking” within the meaning of Williamson County. 879 F.Supp.2d at 962. The facts of the case were “sufficiently different than a true takings case to avoid application of the doctrine” because the owners had not been deprived of all beneficial use of the property, and the owners had asserted a “bona fide equal protection” claim. Id. VI. [9.9] SPECIFIC INVERSE CONDEMNATION CASES While a complete listing of all kinds of inverse condemnation cases is beyond the scope of this chapter, §§9.10 – 9.12 below discusses the recurring themes for inverse condemnation cases of flooding, loss of road access, and regulatory takings. Inverse condemnation cases necessarily focus on whether a “taking” by the government has occurred. Once a property owner proves a taking, the government can be compelled to pay just compensation, along with reimbursements for certain costs in compelling the government to adhere to the Illinois Constitution. 735 ILCS 30/10-5-65. A. [9.10] Flooding/Water Invasion Flooding or water invasion due to a project of a governmental entity is a common scenario for inverse condemnation. The U.S. Supreme Court has enumerated factors for courts to consider in determining whether the flooding or water invasion is a governmental taking requiring eminent domain proceedings. In Arkansas Game & Fish Commission v. United States, ___ U.S. ___, 184 L.Ed.2d 417, 133 S.Ct. 511, 519 (2012), the Court stated that government action need not be permanent to be compensable. The Court stated that flooding cases “should be assessed with reference to the ‘particular circumstances of each case,’ and not by resorting to blanket exclusionary rules.” 133 S.Ct. at 521, quoting United States v. Central Eureka Mining Co., 357 U.S. 155, 2 L.Ed.2d 1228,



78 S.Ct. 1097, 1104 (1958). The factors that courts should consider are (1) the time of the temporary physical invasion, (2) whether the invasion is intended or the foreseeable result of authorized government action, (3) the property owner’s reasonable investment-backed expectations regarding the land’s use, and (4) the severity of the interference. 133 S.Ct. at 522 – 523. Indeed, it appears that the Supreme Court of Illinois has resolved previously unsettled law in this state and adopted the analysis articulated in Arkansas Game & Fish. Although the opinion had not yet been released for formal publication at the time this article went to print, the court made clear that it now adheres to the analysis of Arkansas Game & Fish and overrules previously inconsistent law resulting from Luperini v. County of DuPage, 265 Ill.App.3d 84, 637 N.E.2d 1264, 202 Ill.Dec. 528 (2d Dist. 1984), which held that the temporary accumulation of water on real property was not a taking. See Hampton v. Metropolitan Water Reclamation District of Greater Chicago, 2016 IL 119861 (not yet released for publication). A 2015 Illinois appellate court opinion has followed the same factors articulated by Arkansas Game & Fish, supra. In Sorrells v. City of Macomb, 2015 IL App (3d) 140763, ¶29, 44 N.E.3d 453, 398 Ill.Dec. 424, the court applied these four factors and held that “the requirement within the Illinois Constitution that the government pay just compensation for property . . . is satisfied with an action at law for damages.” B. [9.11] Loss of Road Access The right to access an existing public street is a valuable and compensable property right, but property owners have no right to the continuation of maintenance of the traffic flow past their property. Department of Public Works & Buildings v. Mabee, 22 Ill.2d 202, 174 N.E.2d 801, 802 – 803 (1961) (property owners were not entitled to damages for diminution of value of property not taken due to diversion of traffic). The government can be compelled to bring an eminent domain proceeding if the right of access is significantly and materially changed. See Department of Transportation of State of Illinois ex rel. People v. Rasmussen, 108 Ill.App.3d 615, 439 N.E.2d 48, 64 Ill.Dec. 119 (2d Dist. 1982) (significant and material change to road access entitled defendant to recover damages). “In such a case the proper measure of damages is the difference in market value of the remaining property before and after the access rights are taken.” Village of Round Lake v. Amann, 311 Ill.App.3d 705, 725 N.E.2d 35, 46, 244 Ill.Dec. 240 (2d Dist. 2000). In Department of Transportation ex rel. People v. Interstate Brands Corp., 251 Ill.App.3d 785, 623 N.E.2d 771, 191 Ill.Dec. 181 (4th Dist. 1993), the Illinois Department of Transportation instituted an eminent domain action for a three-year temporary construction easement. The property owner filed a counterclaim seeking remainder damages due to an access change to property that was not the subject of the easement and eminent domain proceedings. The appellate court affirmed the dismissal of the counterclaim, holding that since alleged impairment of access constitutes damage to the property rather than a taking of the property, Patzner v. Baise, 133 Ill.2d 540, 552 N.E.2d 714, 142 Ill.Dec. 123 (1990), relegated the property owner to the Court of Claims for a remedy. 623 N.E.2d 774. Before Patzner and its limitations on when a governmental entity can be compelled to bring an eminent domain suit, courts in Illinois upheld mandamus actions to compel condemnation when the property owner asserted that there was a loss of complete access (People ex rel. First



Nat. Bank of Blue Island v. Kingery, 369 Ill. 289, 16 N.E.2d 761 (1938)), an impairment of access (People ex rel. O’Meara v. Smith, 374 Ill. 286, 29 N.E.2d 274 (1940); Corn Belt Bank v. Cellini, 18 Ill.App.3d 1035, 310 N.E.2d 470, 473 (4th Dist. 1974)), a loss of a specific access point with substituted access resulting in circuitous travel (Department of Transportation v. Shaw, 68 Ill.2d 342, 369 N.E.2d 884, 12 Ill.Dec. 177 (1977)), and breach of an agreement to provide a specific kind and location of access (People ex rel. King v. Lorenz, 34 Ill.2d 445, 216 N.E.2d 123 (1966)). C. [9.12] Regulatory Takings The U.S. Supreme Court has stated that there are two categories of compensable regulatory takings — regulations that cause the property owner to suffer physical invasion, and regulations that deny all economically beneficial uses of the property. Lucas v. South Carolina Coastal Council, 505 U.S. 1003, 120 L.Ed.2d 798, 112 S.Ct. 2886, 2893 (1992). Regulation of land use is not a taking of the property if it “substantially advances legitimate state interests and does not deny an owner the economically viable use of his land.” LaSalle National Bank v. City of Highland Park, 344 Ill.App.3d 259, 799 N.E.2d 781, 790, 278 Ill.Dec. 916 (2d Dist. 2003), citing Northern Illinois Home Builders Ass’n v. County of DuPage, 165 Ill.2d 25, 649 N.E.2d 384, 208 Ill.Dec. 328 (1995). The Illinois appellate court discussed inverse condemnation and regulatory takings in Zeitz v. Village of Glenview, 227 Ill.App.3d 891, 592 N.E.2d 384, 169 Ill.Dec. 897 (1st Dist. 1992). The plaintiffs in Zeitz asserted that zoning changes by the defendant village had constituted a taking of their property rights. The appellate court analyzed the six factors considered in determining whether zoning restrictions are an unreasonable restraint on an owner’s property rights as announced in LaSalle National Bank of Chicago v. County of Cook, 12 Ill.2d 40, 145 N.E.2d 65, 68 – 69 (1957). The appellate court ultimately rejected the plaintiffs’ claim that the amendment of a zoning ordinance reducing by half the number of homes that they could develop on their property was a taking entitling them to relief. Because the ordinance did not deprive the owners of “all economically viable uses for the property,” the court held that they were not entitled to a claim of inverse condemnation. Zeitz v. Village of Glenview, 304 Ill.App.3d 586, 710 N.E.2d 849, 859, 238 Ill.Dec. 52 (1st Dist. 1999). See also Byron Dragway, Inc. v. County of Ogle, 326 Ill.App.3d 70, 759 N.E.2d 595, 259 Ill.Dec. 815 (2d Dist. 2001) (discussing interaction of regulatory takings and abating nuisance); Keene v. Consolidation Coal Co., 645 F.3d 844, 848 – 849 (7th Cir. 2011) (retroactive nature of §1556 of Patient Protection and Affordable Care Act of 2012, Pub.L. No. 111-148, 124 Stat. 119, was not regulatory taking); Muscarello v. Winnebago County Board, 702 F.3d 909, 913 (7th Cir. 2012) (plaintiff’s suit was premature, and regulations allowing wind farms to be built had not caused taking or “direct physical disturbance” of plaintiff’s property), quoting Equity Associates, Inc. v. Village of Northbrook, 171 Ill.App.3d 115, 524 N.E.2d 1119, 1124, 121 Ill.Dec. 71 (1st Dist. 1988). VII. [9.13] CONCLUSION As the law stands today, the practical instances when a property owner may successfully petition for an order of mandamus are limited. A property owner can file a petition for an order of mandamus to compel a governmental entity to institute an eminent domain proceeding when the



government has physically taken the owner’s property. Mandamus is not available to property owners whose property has been only damaged by the government, but not physically taken. In those cases, the property owner must bring a suit for money damages in either the circuit court or the Court of Claims, depending on the governmental actors involved. Furthermore, a property owner must exhaust his or her remedies in state court before bringing a constitutional takings claim in federal court.


Leasehold Damages and Awards in Eminent Domain JOSEPH B. VANFLEET VanFleet Law Offices Peoria

The author would like to thank Brian A. Peterson of VanFleet Law Offices for his contributions to this chapter.

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I. Introduction A. [10.1] Scope of Chapter B. [10.2] The Right To Condemn C. [10.3] Effect of the Condemnation Clause in the Lease II. The Parties A. [10.4] Condemnor B. [10.5] Condemnee-Landlord C. [10.6] Condemnee-Tenant III. The Condemnation Proceeding A. [10.7] Complete Taking B. [10.8] Partial Taking C. [10.9] Valuation of Leasehold — Two Methods 1. [10.10] Apportionment as Part of the Jury Trial 2. [10.11] Posttrial Apportionment Hearing D. Evidence — Valuation of Leasehold 1. [10.12] Burden of Proof 2. [10.13] Options and Verbal Leases 3. [10.14] Permanent Improvements 4. [10.15] Unit Rule for Improvements 5. [10.16] Bonus Value 6. [10.17] Valuation Witnesses 7. [10.18] Valuation Testimony in Separate Apportionment Proceeding 8. [10.19] Comparable Leasehold Valuation 9. [10.20] Consequential Losses IV. [10.21] Effect of Eminent Domain Act on Leasehold Damages and Awards V. [10.22] Conclusion VI. Appendix — Sample Forms A. Automatic Termination Clauses 1. [10.23] Condemnation Clause 2. [10.24] Compensation Clause

LEASEHOLD DAMAGES AND AWARDS IN EMINENT DOMAIN


B. Condemnation Clauses 1. [10.25] Total Condemnation Clause 2. [10.26] Partial Condemnation Clause C. [10.27] Sixty-Day Letter (To Be Sent by Certified Mail, Return Receipt Requested) D. [10.28] Tenant’s Waiver of Lease E. [10.29] Cross-Complaint F. [10.30] Motion for Separate Verdict G. [10.31] Motion for Apportionment of Condemnation Award



I. INTRODUCTION A. [10.1] Scope of Chapter This chapter addresses the leasehold’s interest in a condemnation proceeding from the perspectives of both the landlord and the tenant as well as of the condemning authority. The appendix in §§10.23 – 10.31 below contains sample forms that should be helpful to a practitioner when a leasehold interest is at issue under the eminent domain laws. This chapter is intended to be an aid and a timesaver to the lawyer who must address the impact of a tenant’s interest in a condemnation proceeding. B. [10.2] The Right To Condemn The right of eminent domain is an inherent attribute of sovereignty. Leonard v. Autocar Sales & Service Co., 392 Ill. 182, 64 N.E.2d 477 (1945). The Illinois Supreme Court has defined “eminent domain” “as the right of the Nation or State, or those to whom the power has been lawfully delegated, to condemn private property for public use, and to appropriate the ownership or possession of such property for such use, upon paying the owner just compensation, to be ascertained according to law.” 64 N.E.2d at 481. The right to condemn extends to every kind of property, including not only tangible property but also all rights and interests of any kind in the property. Id. The right of any individual to own, possess, and/or enjoy his or her property must give way to the right of the sovereign to appropriate it to public use when, in the judgment of the sovereign, the public interest will be promoted. Id. A lessee, as tenant of property, takes and holds his or her interest in the property in the same manner as the owner holds title to the property, subject to the right of the sovereign to take the entire property or any part of it upon the payment of just compensation. Id. In short, any landlord-tenant relationship may be affected by the exercise of the power of eminent domain by a condemning authority. See Eminent Domain Act (EDA), 735 ILCS 30/1-1-1, et seq.; ILL.CONST. art. I, §§1, 2, 15; U.S.CONST. amends. V, XIV. In Babbitt v. Youpee, 519 U.S. 234, 136 L.Ed.2d 696, 117 S.Ct. 727 (1997), in an eight-to-one decision, the Supreme Court strongly affirmed the sanctity of just compensation under the Fifth Amendment and the necessity for full just compensation for any taking of private property. The Court stated:

Amended §207 still trains on income generated from the land, not on the value of the parcel. The Court observed in Irving that “[e]ven if . . . the income generated by such parcels may be properly thought of as de minimis,” the value of the land may not fit that description. 117 S.Ct. at 733, quoting Hodel v. Irving, 481 U.S. 704, 95 L.Ed.2d 668, 107 S.Ct. 2076, 2082 (1987).

Babbitt was cited and followed in DuMarce v. Norton, 277 F.Supp.2d 1046 (D.S.D. 2003), rev’d on other grounds sub nom. DuMarce v. Scarlett, 446 F.3d 1294 (Fed.Cir. 2006). See also Andrew S. Gold, The Diminishing Equivalence Between Regulatory Takings and Physical Takings, 107 Dick.L.Rev. 571 (2003).

LEASEHOLD DAMAGES AND AWARDS IN EMINENT DOMAIN §10.2


A tenant is entitled to receive full compensation for the amount of the leasehold estate that is taken for public use. See Bohne v. Bauer, 21 Ill.App.2d 133, 157 N.E.2d 545 (2d Dist. 1959). This conclusion can be drawn from the long-standing proposition that a lease contains a property interest under the law. Valid contracts are property that is “protected by the Fifth Amendment against taking by the federal government, and by the Fourteenth Amendment against taking by a state, unless just compensation is made to the owner.” 26 AM.JUR.2d Eminent Domain §160 (2004). The test by which to answer the question as to whether there is such an estate or interest has been said to be whether the right with respect to real property taken in condemnation is, or is not, so remote or incapable of valuation that it would be disregarded in awarding compensation. See Conness v. Indiana, I. & I.R. Co., 193 Ill. 464, 62 N.E. 221 (1901). Illinois has long accorded respect to the property rights held by tenants. See Chicago & N.W. Ry. v. Miller, 233 Ill. 508, 84 N.E. 683 (1908). See also Blue Cat Lounge, Inc. v. License Appeal Commission of City of Chicago, 281 Ill.App.3d 643, 667 N.E.2d 554, 217 Ill.Dec. 465 (1st Dist. 1996). Whether the taking is partial or complete, both the landlord and the tenant are entitled to a share of the compensation. As stated in Alfred D. Jahr, LAW OF EMINENT DOMAIN: VALUATION AND PROCEDURE §130, p. 189 (1953):

When leased property is acquired by eminent domain, the owner of the fee and the lessee have their respective interests in the total award. The lessee or tenant has a possessory right, and the owner or landlord the reversionary right.

Other commentators have also elaborated on this principle:

Leasehold interests also have value. In many cases, property condemned by governmental authority has an existing lease, giving rights of possession to other than the owner. Depending upon the rent to be paid under the lease, other duties and obligations imposed by the lease upon landlord and tenant, and the length of time the lease has to run, the lease can have considerable value, or little or no value. a) Methods of evaluation — market value, income value etc. used. Generally, the value of the leasehold interest is determined under the same procedures as determining the value of the freehold interest itself. The tenant, upon condemnation, is entitled to compensation for the value of the unexpired term of the lease, to wit, the difference between the fair annual rental of the premises for the unexpired term and the amount of rent actually reserved in the lease for that period. The tenant is not, however, entitled to compensation for the inconvenience of being forced to move. b) Special provisions for condemnation in most commercial leases. Many leases have condemnation clauses, specially providing for the respective rights of landlord and tenant in the event of total or partial condemnation of the property. American Law Institute-American Bar Association, The Law of Eminent Domain, EMINENT DOMAIN AND LAND VALUE LITIGATION, pp. 17 – 18 (Jan. 9, 1997).



C. [10.3] Effect of the Condemnation Clause in the Lease The courts generally enforce the terms of a lease to which the landlord and the tenant have agreed. Peoria Housing Authority v. Sanders, 54 Ill.2d 478, 298 N.E.2d 173, 175 (1973). Thus, absent exigent circumstances, Illinois courts will enforce the terms of a condemnation clause contained in a lease. See Village of Palatine v. Palatine Associates, LLC, 406 Ill.App.3d 973, 942 N.E.2d 10, 347 Ill.Dec. 177 (1st Dist. 2010); National Railroad Passenger Corp. v. Faber Enterprises, Inc., 931 F.2d 438 (7th Cir. 1991). See also Elizondo v. Perez, 42 Ill.App.3d 313, 356 N.E.2d 112, 113, 1 Ill.Dec. 112 (1st Dist. 1976) (“it would be inequitable to nullify the plain wording of the lease and place the landlord at the mercy of a tenant who clearly flouts the provisions of his lease without legal excuse”). Numerous forms exist for possible condemnation clauses in a lease. General forms for leases can be found in COMMERCIAL LANDLORD-TENANT PRACTICE, Ch. 12 (IICLE®, 2015); 7B AM.JUR. Legal Forms 2d Rev. §97:22.1 (2006); 11B AM.JUR. Legal Forms 2d §161:695, et seq. (2006); Emanuel B. Halper, GROUND LEASES AND LAND ACQUISITION CONTRACTS (1988); Emanuel B. Halper, SHOPPING CENTER AND STORE LEASES (1979). Generally speaking, an automatic termination clause terminates the rights of a tenant upon the institution of a condemnation proceeding. See §10.5 below. A condemnation clause, on the other hand, will explain the rights and obligations of both the landlord and the tenant in the event of a taking. Sample forms of both automatic termination clauses and condemnation clauses can be found in §§10.23 – 10.26 below.

PRACTICE POINTERS

Because a condemnation clause expressly sets forth the rights and obligations of the parties to the lease, in drafting these clauses, counsel should consider and address

1. the rights of the parties in the event of a total or partial taking; 2. which parties may participate in a formal condemnation proceeding; 3. which parties may participate in the compensation received; 4. the effect of condemnation on rents; 5. whether, in a partial condemnation, the tenant will continue its tenancy; 6. dispositions of improvements and trade fixtures; and 7. cancellation of the lease. Landlords will generally try to include an automatic termination clause in a lease. On the

other hand, from the tenant’s perspective, all leases should contain a condemnation clause



to force the parties to negotiate and set forth their respective interests prior to a crisis developing. Among the factors influencing the critical need for a condemnation clause include (1) the length of the lease, (2) proximity to a developing area, (3) traffic occurring near the property, and (4) the nature and use of the property and surrounding parcels.

The courts will generally ensure that tenants are not deprived of their property rights. See City of Chicago v. American National Bank & Trust Co., 233 Ill.App.3d 1031, 599 N.E.2d 1126, 175 Ill.Dec. 112 (1st Dist. 1992). The unit rule requires that a leasehold be valued not separately but as part of the whole. City of Chicago v. Anthony, 136 Ill.2d 169, 554 N.E.2d 1381, 1384, 144 Ill.Dec. 93 (1990) (stating that “measure of recovery for damage to private property caused by a public improvement is the loss which concerns the property itself . . . the fair market value of improved property is not the sum of the value of the building and the value of the land computed separately”), quoting Department of Public Works & Buildings v. Lotta, 27 Ill.2d 455, 189 N.E.2d 238, 240 (1963). A leaseholder, like an owner, is clearly entitled to the value of the property interest that is being taken. United States v. General Motors Corp., 323 U.S. 373, 89 L.Ed. 311, 65 S.Ct. 357, 360 (1945). Determining which interests have been taken necessitates an inquiry into the relative rights of the lessor and the lessee at the time of the taking as agreed on in the lease. National Railroad Passenger, supra. When the parties have agreed in advance on the formula to divide the condemnation proceeds for the taking of the leasehold, the resulting sum will likely be deemed fair compensation. Bradley Facilities, Inc. v. Burns, 209 Conn. 480, 551 A.2d 746 (1988); Julius L. Sackman et al., NICHOLS ON EMINENT DOMAIN §§5.01 – 5.51 (rev. 3d ed. 2012). Illinois practitioners once believed that an Illinois Supreme Court review of the constitutionality of the unit rule may be a possibility. See Department of Transportation, State of Illinois v. Kelley, 352 Ill.App.3d 278, 815 N.E.2d 1214, 287 Ill.Dec. 411 (3d Dist. 2004). As noted above, the unit rule requires that a leasehold be valued not separately but as part of the whole. Anthony, supra. However, it is becoming more and more apparent that strict application of the unit rule may not adequately provide just compensation as mandated by the Fifth Amendment of the United States Constitution. Kelley, supra. See also Department of Transportation v. HP/Meachum Land Limited Partnership, 245 Ill.App.3d 252, 614 N.E.2d 485, 185 Ill.Dec. 351 (2d Dist. 1993) (finding different values could be placed on unit of land when there are clearly cognizable different highest and best uses for land); City of Springfield, Illinois v. West Koke Mill Development Corp., 312 Ill.App.3d 900, 728 N.E.2d 781, 785, 245 Ill.Dec. 699 (4th Dist. 2000) (“whole does not necessarily equal the sum of the parts”), quoting Lotta, supra, 189 N.E.2d at 240. The term “just compensation” has been defined by Illinois courts as “the fair market value of the property at its highest and best use on the date the property is condemned.” City of Oakbrook Terrace v. Suburban Bank & Trust Co., 364 Ill.App.3d 506, 845 N.E.2d 1000, 1010 – 1011, 301 Ill.Dec. 135 (2d Dist. 2006). The court in Kelley, supra, acknowledged “that when different uses of the [taken] property are easily delineated, a separate valuation may be appropriate.” 815 N.E.2d at 1218. In Kelley, Presiding Justice Holdridge, specially concurring, argued that cases such as Kelley and HP/Meachum, supra, represent an exception to the unit rule that should be allowed to “swallow up the rule.” 815 N.E.2d at 1219. Justice Holdridge also asked the Illinois Supreme Court to revisit this issue to determine whether the unit rule is of continuing validity. Id. But see Department of Transportation v. East Side Development, L.L.C., 384 Ill.App.3d 295, 892



N.E.2d 136, 322 Ill.Dec. 889 (3d Dist.) (holding that unit rule is proper measurement for condemned properties with lawfully erected off-premises outdoor advertising signs or billboards), appeal denied, 229 Ill.2d 665 (2008). To date, however, the high court has not revisited this issue, nor have the appellate courts seized on this language in an attempt to apply anything but the unit rule. Federal courts, in deciding eminent domain issues, not only rely on state court rulings for guidance, but also on §§8.1 and 8.2 of RESTATEMENT (SECOND) OF PROPERTY: LANDLORD & TENANT (1977), which state:

§8.1 Effect of Taking by Eminent Domain on Lease (1) If there is a taking by eminent domain of all of the leased property for all of the lease term, the lease is terminated. (2) Except to the extent the parties to a lease validly agree otherwise, if there is a taking by eminent domain of less than all of the leased property or for less than all of the lease term, the lease:

(a) is terminated if the taking significantly interferes with the use contemplated by the parties; and (b) is not terminated if the taking does not significantly interfere with the use contemplated by the parties, but the tenant is entitled to an abatement of the rent to the extent prescribed in §11.1.

§8.2 Amount of the Condemnation Award Tenant Entitled to Receive (1) Except to the extent the parties to a lease validly agree otherwise, the tenant is entitled to any award that is made to him in the eminent domain proceedings. (2) Except to the extent the parties to a lease validly agree otherwise, the tenant is entitled to share in a lump-sum award made in the eminent domain proceedings, which lump-sum award is for his and other interests in the property condemned, and the tenant’s share in the lump-sum award is:

(a) if the lease is terminated by the taking, that proportion of the lump-sum award which corresponds to the proportion of the total value of the several interests in the property condemned, valued separately, that represents the value of the unexpired period of the tenant’s lease, plus the value discounted to the date of the taking of the payments the tenant is required to make to the landlord even though the lease is terminated; or (b) if the lease is not terminated by the taking, that proportion of the lump-sum award which corresponds to the proportion of the total value of the several interests in the property condemned, valued separately, that represents the value of a lease of the part of the leased property taken for the unexpired period



of the original lease at a rent equal to the difference between the rent reserved in the original lease and the rent payable by the tenant under the original lease after the taking.

See National Railroad Passenger, supra, 931 F.2d at 443 – 444. Counsel should note that, in the absence of a condemnation clause, courts generally will follow the methods set forth in the Eminent Domain Act, common law, and RESTATEMENTS when dealing with a tenant’s right to receive compensation. Therefore, when drafting a lease, counsel should take special note of their client’s concerns in the event of condemnation and draft a condemnation clause reflective of these concerns. II. THE PARTIES A. [10.4] Condemnor The condemnor’s primary responsibility is to ensure that all interested parties are properly named and served in the eminent domain proceeding. See 735 ILCS 30/10-5-10(a). These interested parties include holders of leasehold interests. See Bohne v. Bauer, 21 Ill.App.2d 133, 157 N.E.2d 545 (2d Dist. 1959). A leasehold is a property interest that, if taken, is subject to just compensation, which is the fair cash market value of the subject property at its highest and best use on the date of the filing of the petition to condemn. Department of Public Works & Buildings v. Association of Franciscan Fathers of State of Illinois, 69 Ill.2d 308, 371 N.E.2d 616, 13 Ill.Dec. 681 (1977). Prior to preparing a complaint for condemnation, the condemnor should first obtain a title search. Tenants and other parties with a possessory interest in the property will appear as interested parties if the interest has been recorded. Unfortunately, many leasehold interests are not recorded, so the condemnor’s attorney should investigate the existence of tenants with unrecorded leases. A thorough investigation should uncover all leasehold interests in the property. If all of these interests are not named in the complaint, the condemning authority may not obtain clear title. If the condemning authority is the State of Illinois and the matter has arisen after December 31, 1991, the state must provide a 60-day letter. 735 ILCS 30/10-5-15(a), 30/10-5-15(d). This letter must be provided only to the property owner and not to a tenant. 735 ILCS 30/10-5-15(d). A sample form of a 60-day letter is found in §10.27 below. No matter who is the condemning authority, the condemnor usually will attempt to quickly resolve any leasehold interests by obtaining signed waivers by the tenants. A sample form of a tenant’s waiver of a lease is found in §10.28 below. If a tenant agrees to sign such a waiver, the condemning authority cannot show the property owner the amount it has agreed to pay the tenant for the leasehold interest and thereby bind the nonconsenting landlord. Chicago, B. & Q.R. Co. v. F. Reisch & Bros., 247 Ill. 350, 93 N.E. 383 (1910).



Without a signed waiver, a condemnor can be transformed into an owner-landlord. People ex rel. Department of Transportation v. Walliser, 258 Ill.App.3d 782, 629 N.E.2d 1189, 196 Ill.Dec. 345 (3d Dist. 1994). Care must be taken in the process to determine whether this is the goal of the condemnor. B. [10.5] Condemnee-Landlord Automatic termination clauses are clauses stating that the lease terminates upon notice or the filing of a condemnation case. Counsel for tenants must be conscious of such clauses, because they are enforceable and they serve to bar the tenant from participation in the condemnation award. Sample forms of automatic termination clauses are found in §§10.23 and 10.24 below. The rationale is that since the clause serves to terminate the lease upon a condemnation, no tenant interest remains to be protected. Village of Palatine v. Palatine Associates, LLC, 406 Ill.App.3d 973, 942 N.E.2d 10, 347 Ill.Dec. 177 (1st Dist. 2010); Select Lake City Theatre Operating Co. v. Central National Bank in Chicago, 277 F.2d 814 (7th Cir. 1960). See also City of Rochester v. Northwestern Bell Telephone Co., 431 N.W.2d 874 (Minn.App. 1988); United States v. Advertising Checking Bureau, Inc., 204 F.2d 770, 772 – 773 (7th Cir. 1953) (holding that when tenant “had contracted away both the remainder of its term and the right to share in any award, the finding of the trial court that the [tenant] was entitled to no award was correct”). Practitioners should note, however, that when preparing a termination clause, courts have held that a landlord who is guilty of bad faith and unconscionable conduct in dealing with the tenant may lose any resultant benefit of the condemnation award. Forest Preserve Dist. of Cook County v. Christopher, 321 Ill.App. 91, 52 N.E.2d 313 (1st Dist. 1943); City of Chicago v. American National Bank & Trust Co., 233 Ill.App.3d 1031, 599 N.E.2d 1126, 175 Ill.Dec. 112 (1st Dist. 1992). Therefore, counsel for a landlord may consider asking the tenant to review the lease with counsel of his or her choosing prior to execution. Both the landlord and the tenant should be aware that title to the property will relate back to the date of the filing of the petition to condemn, and liens on or rights existing against the land prior to that date are transferred to or included in the award. City of Chicago v. McCausland, 379 Ill. 602, 41 N.E.2d 745, 747 (1942). The landlord’s title is not extinguished, however, until the judgment is paid in full. Bohne v. Bauer, 21 Ill.App.2d 133, 157 N.E.2d 545, 546 (2d Dist. 1959); Forest Preserve District of DuPage County v. First National Bank of Franklin Park, 2011 IL 110759, 961 N.E.2d 775, 356 Ill.Dec. 386. The tenant’s portion of the ultimate compensation paid is limited to the difference between the rent paid under the lease and the market rate the tenant will need to pay upon relocation. One commentator has stated:

If the actual rental rate of the tenant is equal to the market rate or greater than the market rate, then the tenant has no positive leasehold estate interest and is entitled to no compensation for cancellation of the remainder of the lease term. In a whole taking, the tenant will be able to lease other space in the market at the same rate or a more favorable rate than the above-market rate that the tenant was previously paying; thus the tenant is not denied any rental benefit.



In a tenancy at will or a month-to-month lease, there is no possible continuing leasehold benefit, and the tenant is entitled to no compensation for termination of the leasehold interest since it could have been terminated at any time by the landlord without the consent of the tenant. The most common point of contention between landlords and tenants in eminent domain proceedings germinates from a lease provision that states that on condemnation of the leased premises, the lease terminates. The tenant will argue that it was the intention of the parties that the termination of the lease would not have the effect of cutting off the tenant’s prospective claim for a beneficial leasehold interest, but that is exactly what the termination of the lease does. At best, such a provision results in litigation over whether the lease is vague. The landlord will argue that references in the lease to the tenant’s rights to condemnation compensation relate to the tenant’s rights to claim value in any leasehold improvements still owned by the tenant (which frequently are minimal since leases often provide that fixtures installed by the tenant, once installed, become the property of the landlord) or the tenant’s rights to relocation assistance. Similarly, a provision that permits either the landlord or the tenant to elect to terminate a lease upon a partial eminent domain acquisition has the legal effect of turning the lease into a tenancy at will. A lease that continues only at will or from month to month leaves no possible claim by the tenant for a beneficial leasehold interest. If the landlord is not bound to continue the lease, the tenant cannot claim a vested right in the beneficial lease rate. Options for renewal of lease terms can be valuable for leasehold interests. The measure of damages in the value of the use and occupancy of the leasehold estate in a whole taking is the leasehold benefit for the remainder of the tenant’s term plus the value of the right to renew if such rights exist, less the agreed rent the tenant would pay for the use and occupancy during the option period. James Noble Johnson, Ultimate Questions: Valuation Issues in Eminent Domain Takings, 1994 Inst. on Plan. Zoning & Eminent Domain §8.05[4][a].

C. [10.6] Condemnee-Tenant Generally, in a complete taking, the tenant is entitled to the reasonable value of the unexpired portion of the lease, less the rent that would have been due the landlord. Department of Public Works & Buildings v. Bohne, 415 Ill. 253, 113 N.E.2d 319 (1953) (holding that option to renew contained in lease in favor of tenant can be included in damage calculations). If the rent reserved in the lease equals or exceeds market value, the tenant is entitled to nothing. Commercial Delivery Service, Inc. v. Medema, 7 Ill.App.2d 419, 129 N.E.2d 579 (1st Dist. 1955). A tenant who has enjoyed the full term of the lease is not entitled to compensation, but if the complete taking is prior to the lease’s expiration, then the tenant is entitled to compensation. Schreiber v. Chicago & E.R. Co., 115 Ill. 340, 3 N.E. 427 (1885). See also City of Lake Forest v. First National Bank of Lake Forest, 52 Ill.App.3d 893, 368 N.E.2d 156, 10 Ill.Dec. 670 (2d Dist. 1977) (holding that when lessee exercising its rights under lease voluntarily cancels lease between date petition to condemn is filed and date compensation is paid, lessee is not entitled to any portion of



that condemnation award). However, a tenant must take caution in the condemnation proceeding if it hopes to obtain an award at the end. Illinois courts have held that, if the lease expires during the pendency of the eminent domain proceeding, the tenant may not recover. Public Building Commission of Chicago v. Yellen, 2013 IL App (1st) 112638, 986 N.E.2d 706, 369 Ill.Dec. 393. Tenants must understand, however, that courts rarely apply liberal or expanded views to leasehold interests. For example, a temporary one-year prohibition of the tenant’s license to sell liquor does not cause the landlord to suffer a taking because a liquor license is a privilege and not a property right. Blue Cat Lounge, Inc. v. License Appeal Commission of City of Chicago, 281 Ill.App.3d 643, 667 N.E.2d 554, 217 Ill.Dec. 465 (1st Dist. 1996). Another court held that the relocation and remodeling expenses of the tenant did not benefit the landlord and thus did not qualify as restitution damages. Lempa v. Finkel, 278 Ill.App.3d 417, 663 N.E.2d 158, 215 Ill.Dec. 408 (2d Dist. 1996). See also Yellow Cab Co. v. City of Chicago, 919 F.Supp. 1133 (N.D.Ill. 1996) (municipality capped lease rates). In United States v. Certain Lands in Jo Daviess County, Ill., 120 F.2d 561 (7th Cir. 1941), tenant-placed houses that had been on the property for 20 to 30 years were lost to the landlord based on lease provisions. The court held that, under Illinois law, they became part of the realty. No portion of the condemnation award went to the year-to-year tenants. Compare Empire Building Corp. v. Orput & Associates, Inc., 32 Ill.App.3d 839, 336 N.E.2d 82 (2d Dist. 1975), in which, in a month-to-month lease involving a complete taking, the court found a presumption for the tenant. In National Railroad Passenger Corp. v. Faber Enterprises, Inc., 931 F.2d 438 (7th Cir. 1991), Amtrak condemned a subleased restaurant as the first step in the renovation of Union Station. In denying the lessee compensation for the removable property, the immovable fixtures, and the personal property, the court cited both the common law and the agreed termination-on-condemnation clause in the lease. The court held that the tenant was not entitled to compensation for personal property that it abandoned on the premises. The taking extinguished the tenant’s right of first refusal. A lease provision that accorded substantial value to trade fixtures removable by the tenant prior to expiration of a lease was cited as the basis for the landlord to recover the entire condemnation award for the taking of the leasehold in United States v. 1.357 Acres of Land, 308 F.2d 200 (7th Cir. 1962). Similarly, personal property of a tenant remained for the benefit of a landlord, pursuant to the lease provisions in Medema, supra. Accord Select Lake City Theatre Operating Co. v. Central National Bank in Chicago, 277 F.2d 814 (7th Cir. 1960). In Lake Forest, supra, following answers to interrogatories, the condemnor discovered that the tenant had voluntarily canceled the lease shortly after the condemnation complaint had been filed. In affirming the trial court’s dismissal of the tenant’s claim for leasehold damages, the appellate court stated:

Union Oil’s first assertion on this appeal is that it is entitled to compensation for the value of the leasehold taken when Lake Forest instituted the eminent domain proceedings. It contends that its right to compensation became vested on the date the petition to condemn was filed and that any action it took after the petition was



filed is irrelevant to its right to receive compensation. We must disagree. Union Oil’s lease contained a provision allowing it to cancel the lease in the event there was a taking by eminent domain. It seems only reasonable that this provision of the lease should be viewed as giving Union Oil a choice of either staying on and continuing to pay rent in order to preserve its right to share in the condemnation award, or of cancelling the lease and thereby extinguishing both its obligation to pay rent and its right to share in the condemnation award. It is absurd to maintain that Union Oil should be in the same position upon cancelling the lease as it would have been had it continued to honor it. It must be remembered that Union Oil was but a lessee, and a lessee’s right to compensation consists only of its right to share in the condemnation award of its landlord. Therefore, it seems only fair that when the landlord receives no rent because the lessee has cancelled the lease, then the landlord should not be obligated to share its condemnation award with its former tenant. 368 N.E.2d at 157.

Accord Schreiber, supra (lease expired prior to condemnation award). See Illinois Department of Natural Resources v. Pedigo, 348 Ill.App.3d 1044, 811 N.E.2d 761, 285 Ill.Dec. 274 (4th Dist. 2004) (following Lake Forest court’s holding that physical proximity of properties is not conclusive but merely relevant to continguity). Similarly, in City of Rockford v. Robert Hallen, Inc., 51 Ill.App.3d 22, 366 N.E.2d 977, 9 Ill.Dec. 466 (2d Dist. 1977), the court held that a lessor cannot be limited in leasehold damages in a partial taking until a gross award for just compensation has been entered. Finally, in City of Chicago v. Shayne, 46 Ill.App.2d 33, 196 N.E.2d 521 (1st Dist. 1964), the landlord received the entire award when the evidence showed that the tenant had failed to pay precondemnation rent and offered no evidence as to the value of the leasehold. III. THE CONDEMNATION PROCEEDING A. [10.7] Complete Taking In a complete taking, the entire leasehold interest is taken by the condemning authority. By operation of law, the leasehold estate is extinguished, and all obligations between the tenant and the landlord cease to exist. Corrigan v. City of Chicago, 144 Ill. 537, 33 N.E. 746 (1893). The Illinois Supreme Court in Corrigan held:

The measure of compensation for the estate of the tenant taken is the value of her leasehold estate, subject to the rent covenanted to be paid. If the value exceeds the rental she will be entitled to recover the excess. If it does not exceed the rent reserved, she will be entitled to [nothing]. 33 N.E. at 749.

Notwithstanding whether the taking is complete, the tenant remains obligated to pay rent until the date of the condemnation judgment. Bohne v. Bauer, 21 Ill.App.2d 133, 157 N.E.2d 545 (2d Dist. 1959). Vesting of title in the condemnor, however, is conditioned on payment and deposit of the award. Chicago Park Dist. v. Downey Coal Co., 1 Ill.2d 54, 115 N.E.2d 223 (1953); Bauer, supra, 157 N.E.2d at 546. Thus, the preliminary just compensation must be deposited in a quick-take action, which in turn permits entry of an order vesting title in the condemnor. See 735 ILCS 30/20-5-5, et seq.



In a complete taking, the primary issue is the leasehold’s fair cash rental value as compared to the actual rent paid under the lease agreement. Thus, the tenant’s damages can be measured by the fair cash market value of the leasehold, less the rental actually being paid. Department of Public Works & Buildings v. Bohne, 415 Ill. 253, 113 N.E.2d 319 (1953); Corrigan, supra; Yellow Cab Co. v. Howard, 243 Ill.App. 263 (1st Dist. 1927); Commercial Delivery Service, Inc. v. Medema, 7 Ill.App.2d 419, 129 N.E.2d 579 (1st Dist. 1955). B. [10.8] Partial Taking In a partial taking, the condemnation clause in the lease should set forth the rights and obligations of the tenant. Absent an express condemnation clause, the partial taking of a leasehold that does not adversely affect the lease results in no compensation to the tenant, and the tenant continues to remain obligated under the terms of the lease. Stubbings v. Village of Evanston, 136 Ill. 37, 26 N.E. 577 (1891); Corrigan v. City of Chicago, 144 Ill. 537, 33 N.E. 746 (1893). Conversely, if the taking is of such a magnitude that the tenant can no longer operate, then the result is essentially the same as a complete taking. Yellow Cab Co. v. Stafford-Smith Co., 320 Ill. 294, 150 N.E. 670 (1926). See Alan N. Polasky, The Condemnation of Leasehold Interests, 48 Va.L.Rev. 477 (1962); Julius L. Sackman, Compensation upon the Partial Taking of a Leasehold Interest, 3 Inst. on Eminent Domain 35 (1962). However, if a tenant loses the leasehold interest for only a temporary period of time, the courts have held that the rent does not abate since the situation is similar to a partial take. Leonard v. Autocar Sales & Service Co., 392 Ill. 182, 64 N.E.2d 477 (1945). Similar to a complete taking, the prevailing test in a partial condemnation of a tenant’s leasehold is the fair rental value of the leasehold taken, less the rent. Department of Public Works & Buildings of State of Illinois v. Blackberry Union Cemetery, 32 Ill.App.3d 62, 335 N.E.2d 577 (2d Dist. 1975). One commentator has noted the following hypothesis:

For example, a lessee pays $500 a month rent and has two years to go on his lease. He has constructed buildings which revert to landlord at termination of lease, so he has the use and enjoyment of buildings and land for two more years. Because of this the fair market value of the leasehold at the time of taking is $700 a month. After the partial taking, it is $200 a month. The lessee is entitled to $700 × 24 ($16,800) less $200 × 24 ($4,800) or $12,000, discounted for cash. This is actually the same as saying the lessee is entitled to the difference between the fair cash market value of the leasehold before and after the taking, the applicable test according to other authorities. Frank S. Righeimer, Jr., EMINENT DOMAIN IN ILLINOIS §6.281, p. 214 (3d ed. 1986).

In Corrigan, supra, the landmark Illinois case that remains virtually untested and unaltered since its decision, the court stated that the true way to measure compensation for the tenant in a partial taking is to place a value on the leasehold at the time of the filing of the complaint to condemn and to subsequently deduct the value of the use of the premises not taken. See §10.7 above.



Finally, Illinois Pattern Jury Instructions — Civil No. 300.59 provides:

In deciding whether the tenant is entitled to a share of the compensation to be paid for the entire property, you must first determine the fair rental value of the tenant’s leasehold. If the fair rental value of the leasehold exceeds the rent agreed upon in the lease, the tenant is entitled to the excess. But if the fair rental value of the leasehold does not exceed the rent, the tenant is not entitled to any share of the compensation.

C. [10.9] Valuation of Leasehold — Two Methods At trial, the condemnees can elect one of two methods for the apportionment of their leasehold damages. First, the landlord and the tenant can request the jury to apportion damages after the determination of the gross award. Commercial Delivery Service, Inc. v. Medema, 7 Ill.App.2d 419, 129 N.E.2d 579 (1st Dist. 1955). See also 735 ILCS 30/10-5-70. Alternatively, either party can petition the court to hold a subsequent and separate apportionment proceeding following the trial. See id. In a partial taking, the condemnees should file a cross-complaint. A sample form of a cross-complaint is found in §10.29 below. It is unnecessary to file a cross-complaint in a complete taking. If any dispute arises regarding which method is preferable, the parties should file a motion in limine to resolve the dispute outside the presence of the jury. 1. [10.10] Apportionment as Part of the Jury Trial Apportionment as part of the jury trial is provided by statute and has long been recognized by the Illinois courts. See 735 ILCS 30/10-5-90. See also Chicago, B. & Q.R. Co. v. F. Reisch & Bros., 247 Ill. 350, 93 N.E. 383 (1910); Lambert v. Giffin, 257 Ill. 152, 100 N.E. 496, 499 (1912). This method of determining leasehold damages can be placed before the court by filing an appropriate motion. A sample form of a motion for a separate verdict is found in §10.30 below. 2. [10.11] Posttrial Apportionment Hearing The condemnor will be required to deposit the condemnation proceeds with the county treasurer prior to title being vested in the condemning authority. 735 ILCS 30/20-5-15(a). If it is clear under the lease that only the landlord should recover the condemnation proceeds, then a waiver and consent can be obtained from the tenants. A sample form of a tenant’s waiver of a lease is found in §10.28 below. Otherwise, a motion can be filed by any one of the condemnees seeking posttrial apportionment of the proceeds. A sample form of a motion for the apportionment of a condemnation award is found in §10.31 below. A bifurcated proceeding has been held appropriate to apportion condemnation proceeds between the landlord and the tenant. Commercial Delivery Service, Inc. v. Medema, 7 Ill.App.2d 419, 129 N.E.2d 579 (1st Dist. 1955); Department of Transportation v. White, 264 Ill.App.3d 145, 636 N.E.2d 1204, 201 Ill.Dec. 772 (5th Dist. 1994).



D. Evidence — Valuation of Leasehold 1. [10.12] Burden of Proof The burden of proof to value the leasehold estate lies with the condemning authority. Chicago, B. & Q.R. Co. v. F. Reisch & Bros., 247 Ill. 350, 93 N.E. 383 (1910); Department of Public Works & Buildings v. Bohne, 415 Ill. 253, 113 N.E.2d 319 (1953). In meeting this burden, the Fourth District has pointed out that both the U.S. and Illinois Constitutions require only that the owner of the lands taken be made whole and not that the owner be placed in a better position than before the taking. Illinois Department of Natural Resources v. Pedigo, 348 Ill.App.3d 1044, 811 N.E.2d 761, 285 Ill.Dec. 274 (4th Dist. 2004). See also Department of Natural Resources of State of Illinois v. Brauer, 339 Ill.App.3d 723, 791 N.E.2d 120, 274 Ill.Dec. 324 (3d Dist. 2003). 2. [10.13] Options and Verbal Leases An option to renew is valued and thus capable of expanding the lease term. In fact, there is a presumption that the tenant will exercise its option to renew. Department of Public Works & Buildings v. Bohne, 415 Ill. 253, 113 N.E.2d 319 (1953). See also Texaco Refining & Marketing, Inc. v. Crown Plaza Group, 845 S.W.2d 340 (Tex.App. 1992) (holding that, as matter of law, tenant had right to share in condemnation award, and tenant did not act in bad faith by tendering rent and exercising option to renew lease). On the other hand, a tenant’s mere expectancy of continued lease renewals may not be a compensable property interest. See State of Arizona ex rel. Miller v. Gannett Outdoor Company of Arizona, Inc., 164 Ariz. 578, 795 P.2d 221 (App. 1990). See also State of New Hampshire v. 3M National Advertising Co., 139 N.H. 360, 653 A.2d 1092, 1094 (1995) (in holding against sign tenant, court noted that ground leases lacked renewal options and refused to recognize any value in tenant’s claimed “inchoate interest to renew the lease”). A tenant’s unexercised purchase option may be a compensable property interest. State of New Jersey v. Jan-Mar, Inc., 236 N.J.Super. 28, 563 A.2d 1153 (1989). Similarly, while not a formal lease, the Illinois Supreme Court has held that a proposal letter to lease a small portion of ground space for a sign could be considered by a valuation witness. City of Chicago v. Anthony, 136 Ill.2d 169, 554 N.E.2d 1381, 144 Ill.Dec. 93 (1990) (ruling that experts in condemnation cases may rely on materials that are substantively inadmissible as long as experts in field reasonably rely on such materials). However, a verbal lease has been held insufficient to support a condemnation award to a tenant. Conness v. Indiana, I. & I.R. Co., 193 Ill. 464, 62 N.E. 221 (1901). 3. [10.14] Permanent Improvements Permanent improvements installed by a tenant must be considered in arriving at the fair cash rental value of a leasehold. Department of Public Works & Buildings v. Bohne, 415 Ill. 253, 113 N.E.2d 319 (1953). It must be clear, however, that the improvements belong to the tenant. In Commercial Delivery Service, Inc. v. Medema, 7 Ill.App.2d 419, 129 N.E.2d 579 (1st Dist. 1955), a loading dock was installed by the tenant. Nevertheless, pursuant to the lease, the dock belonged to the landlord and not to the tenant.



4. [10.15] Unit Rule for Improvements The unit rule for improvements prohibits separate valuation of leasehold improvements. Rather, the test is whether the improvement enhances the leasehold’s value. In United States v. 1.357 Acres of Land, 308 F.2d 200 (7th Cir. 1962), the lease contained a condemnation clause, but the court still considered whether the tenant was entitled to compensation for its improvements to the leasehold. Moreover, in Empire Building Corp. v. Orput & Associates, Inc., 32 Ill.App.3d 839, 336 N.E.2d 82, 84 (2d Dist. 1975), the court held:

In disputes between the landlord and tenant there is a presumption that the tenant, by annexing fixtures, did so for his own benefit and not to enrich the freehold, and the law accordingly construes the tenant’s right to remove his annexations liberally, at least where removal may be effected without material injury to the freehold.

In Department of Transportation v. East Side Development, L.L.C., 384 Ill.App.3d 295, 892 N.E.2d 136, 322 Ill.Dec. 889 (3d Dist.), appeal denied, 229 Ill.2d 665 (2008), the Third District Appellate Court upheld the use of the unit rule for condemned properties with lawfully erected off-premises outdoor advertising signs or billboards. The defendant billboard owner argued that 735 ILCS 30/10-5-5 provided for billboard owners to obtain a separate market value for the billboard owner’s loss resulting from the condemnation. The court determined that the statutory language is clear and only provides that the owner has a compensable interest, not that the interest should be valued separately from the property as a whole. 892 N.E.2d at 140. 5. [10.16] Bonus Value The bonus value of the leasehold belongs to the tenant. In a complete taking, the landlord would receive the present value of the agreed reserved rent for the remainder of the lease term. If the tenant had negotiated a below-market rental amount, the tenant would then be entitled to the difference, or bonus amount. Department of Public Works & Buildings v. Metropolitan Life Insurance Co., 42 Ill.App.2d 378, 192 N.E.2d 607 (1st Dist. 1963). The phrase “bonus value” or “bargain value” is the difference between the rent reserved and the rental value of the premises. It also has been referred to as an “overplus” or a “surplus.” Alfred D. Jahr, LAW OF EMINENT DOMAIN: VALUATION AND PROCEDURE §131, p. 198 (1953). A tenant must ensure that evidence of the bonus value is put into the record. In a case involving the apportionment of condemnation proceeds between the landlord and a tenant, a Missouri appellate court reversed and held that no evidence regarding the bonus value of the leasehold was introduced at trial, and, therefore, the landlord was entitled to 100 percent of the award. St. Louis County, Missouri v. Boatmen’s Trust Co., 857 S.W.2d 453 (Mo.App. 1993). Similarly, a Florida court refused to permit a tenant to recover its bonus value because it would amount to an impermissible double recovery. Bolduc v. Glendale Federal Bank, 631 So.2d 1127 (Fla.App. 1994). In Department of Transportation v. East Side Development, L.L.C., 384 Ill.App.3d 295, 892 N.E.2d 136, 322 Ill.Dec. 889 (3d Dist.), appeal denied, 229 Ill.2d 665 (2008), the Third District Appellate Court stated in dicta that bonus value may not be the only way to determine just compensation for a leasehold. The defendant billboard owner argued that bonus value did not



take into consideration the value of the billboard and the property’s value for producing rental income. The court reiterated “that the measure of compensation for a leasehold interest is the value of the interest, subject to the rent covenanted to be paid.” 892 N.E.2d at 141. While the Illinois Supreme Court has specifically rejected the proposal that profits derived from the property are a basis for determining just compensation, the Third District Appellate Court stated that bonus value may not be the only appropriate method for valuing a leasehold interest but did not give any examples of other methods that would be considered appropriate. 892 N.E.2d at 141 – 142. The Illinois Supreme Court has denied certification on appeal, so East Side Development leaves open the question of what other methods of valuation may be appropriate for determining just compensation. 6. [10.17] Valuation Witnesses Any person acquainted with the property can be a valuation witness in a leasehold case. Department of Public Works & Buildings v. Bohne, 415 Ill. 253, 113 N.E.2d 319, 325 (1953); People ex rel. McDonough v. Goldberg, 354 Ill. 423, 188 N.E. 428 (1933); Illinois Power & Light Corp. v. Talbott, 321 Ill. 538, 152 N.E. 486 (1926). But see Department of Public Works & Buildings of State of Illinois v. Blackberry Union Cemetery, 32 Ill.App.3d 62, 335 N.E.2d 577 (2d Dist. 1975) (excluding witness testimony as to value, as it provided no probative value). A lease executed in good faith before commencement of condemnation proceedings is admissible in evidence on the issue of the rental value of the property. Department of Public Works & Buildings v. Kirkendall, 415 Ill. 214, 112 N.E.2d 611 (1953).

PRACTICE POINTER

Based on Bohne, supra, and the flexibility under Illinois law in valuing a leasehold, the following items should be noted regarding leasehold valuation testimony:

a. The valuation witness should read the lease and be familiar with its terms. b. The witness must know the property, its use, and its value for the purposes to

which it is being applied. c. A witness may express an opinion of fair cash rental value even though not

engaged in the business of leasing property or of real estate in general. d. A witness who testifies to an opinion of fair cash rental value must be familiar

with the terms and conditions of the lease and must have background, experience, or knowledge on which to predicate this opinion of value.

e. A witness who testifies to the fair cash market value of the real estate subject to a

lease must be familiar with the terms and provisions of the lease, the existence of options of renewal, provisions relating to improvements, and improvements made.

f. A witness who testifies to the fair cash market value of the real estate subject to a

lease can properly consider the leased portions and any unleased portions as distinct elements in arriving at the value of the entire property.



For trial purposes, attorneys should note that the Federal Rules of Evidence must be considered when experts testify about their opinions of value in Illinois condemnation proceedings. In Wilson v. Clark, 84 Ill.2d 186, 417 N.E.2d 1322, 49 Ill.Dec. 308 (1981), the Illinois Supreme Court adopted Fed.R.Evid. 703 and 705 and their application to the testimony of experts. In City of Chicago v. Anthony, 136 Ill.2d 169, 554 N.E.2d 1381, 144 Ill.Dec. 93 (1990), the Illinois Supreme Court held that these rules apply to real estate valuations. Fed.R.Evid. 703 provides, in part:

An expert may base an opinion on facts or data in the case that the expert has been made aware of or personally observed. If experts in the particular field would reasonably rely on those kinds of facts or data in forming an opinion on the subject, they need not be admissible for the opinion to be admitted.

Fed.R.Evid. 705 provides:

Unless the court orders otherwise, an expert may state an opinion — and give the reasons for it — without first testifying to the underlying facts or data. But the expert may be required to disclose those facts or data on cross-examination.

The Illinois Supreme Court in Snelson v. Kamm, 204 Ill.2d 1, 787 N.E.2d 796, 272 Ill.Dec. 610 (2003), reiterated its holding that an expert may give an opinion without disclosing the underlying facts or data. The burden, under these circumstances, is placed on the adverse party during cross-examination to elicit the facts underlying the expert opinion. Id. 7. [10.18] Valuation Testimony in Separate Apportionment Proceeding If the parties elect to proceed with a separate posttrial apportionment proceeding, the valuation testimony in this proceeding is similar to the testimony in a jury trial. However, the only issue is the fair cash rental value of the leasehold, and the court will not consider the fair cash market value of the whole. City of Chicago v. American National Bank & Trust Co., 233 Ill.App.3d 1031, 599 N.E.2d 1126, 1129 – 1130, 175 Ill.Dec. 112 (1st Dist. 1992); Commercial Delivery Service, Inc. v. Medema, 7 Ill.App.2d 419, 129 N.E.2d 579 (1st Dist. 1955); Department of Public Works & Buildings v. Metropolitan Life Insurance Co., 42 Ill.App.2d 378, 192 N.E.2d 607 (1st Dist. 1963). In Department of Transportation v. Singh, 393 Ill.App.3d 458, 914 N.E.2d 511, 333 Ill.Dec. 92 (2d Dist. 2009), defendant Singh filed a motion for apportionment for a condemnation award received by BP Products of North America, Inc. Singh was a franchisee of BP, and BP terminated its lease agreement with Singh approximately ten days prior to the date of condemnation. 914 N.E.2d at 513. Singh attempted to receive a portion of the condemnation award under the Petroleum Marketing Practices Act (PMPA), Pub.L. No. 95-297, 92 Stat. 322 (1978), which governs franchise agreements for the sale of motor fuel. Id. The PMPA provides that the “franchisor shall fairly apportion between the franchisor and the franchisee compensation, if any, received by the franchisor based upon any loss of business opportunity or good will.” Id., quoting 15 U.S.C. §2802(d)(1). The appellate court affirmed the trial court’s decision that the PMPA only



mandated apportionment of compensation if it was allowed under state law. 914 N.E.2d at 513 – 514. Illinois state law does not allow condemnation awards to include compensation for loss of business. Id. 8. [10.19] Comparable Leasehold Valuation Comparable leasehold valuation evidence is not generally as easy to obtain as comparable-sales evidence. As stated by one commentator,

[t]he holding by the courts that leasehold interests are to be valued according to their “market value” probably poses a problem which is just as complicated as the original problem. How are those interests to be valued by “market value”? Certainly there are very few sales of leases exactly in point. It is not like valuing a piece of real property where you may find sales of comparable properties in the vicinity. Each leasehold is sui generis. Nevertheless, the courts have said that market value is the measure of compensation to the lessee. The market value must be determined by qualified experts in the sale of leases. [Footnote omitted.] Alfred D. Jahr, LAW OF EMINENT DOMAIN: VALUATION AND PROCEDURE §130, p. 194 (1953).

Often the best source of comparable leasehold estates will be commercial real estate brokers and leasing agents. The difficulty in obtaining convincing and admissible leasehold valuation testimony has been demonstrated by several Illinois courts. See, e.g., City of Chicago v. Lord, 276 Ill. 544, 115 N.E. 8 (1916); Commercial Delivery Service, Inc. v. Medema, 7 Ill.App.2d 419, 129 N.E.2d 579 (1st Dist. 1955); Department of Public Works & Buildings v. Lambert, 411 Ill. 183, 103 N.E.2d 356 (1952); Department of Public Works & Buildings of State of Illinois v. Blackberry Union Cemetery, 32 Ill.App.3d 62, 335 N.E.2d 577 (2d Dist. 1975); Sanitary Dist. of Chicago v. Boening, 267 Ill. 118, 107 N.E. 810 (1915). 9. [10.20] Consequential Losses A landlord’s consequential losses (i.e., loss of profits, relocation expenses, and damage to goodwill) are not recoverable. United States v. Petty Motor Co., 327 U.S. 372, 90 L.Ed. 729, 66 S.Ct. 596 (1946); National Railroad Passenger Corp. v. Faber Enterprises, Inc., 931 F.2d 438 (7th Cir. 1991); United States v. Meyer, 113 F.2d 387, 397 (7th Cir.) (income is generally too conjectural and inadmissible to prove value), cert. denied, 61 S.Ct. 174 (1940); Kurth v. Iowa Department of Transportation, 628 N.W.2d 1, 9 – 10 (Iowa 2001). IV. [10.21] EFFECT OF EMINENT DOMAIN ACT ON LEASEHOLD DAMAGES

AND AWARDS The Eminent Domain Act took effect January 1, 2007, and applies only to complaints to condemn filed on or after this effective date. The EDA replaces, and sometimes modifies, the former provisions of the Code of Civil Procedure, 735 ILCS 5/7-101, et seq., for eminent domain proceedings. (Note that, in two instances, old eminent domain statutes still apply: (a) the O’Hare Modernization Act, 620 ILCS 65/1, et seq. (see 620 ILCS 65/15); and (b) tax increment allocation



redevelopment plans adopted prior to April 15, 2006. 735 ILCS 30/5-5-5(a-5), 30/5-5-5(a-10).) Although the EDA is extensive in its provisions, its effect on leasehold damages and awards in eminent domain proceedings is minimal. What changes the EDA does have on leasehold damages and awards will be most evident when determining the value of the leasehold. The EDA provides that the value of taken property

shall be determined and ascertained as of the date of filing the complaint to condemn, except that:

(i) in the case of property not being acquired under Article 20 (quick-take), if the trial commences more than 2 years after the date of filing the complaint to condemn, the court may, in the interest of justice and equity, declare a valuation date no sooner than the date of filing the complaint to condemn and no later than the date of commencement of the trial; and

(ii) in the case of property that is being acquired under Article 20 (quick-take), if the trial commences more than 2 years after the date of filing the complaint to condemn, the court may, in the interest of justice and equity, declare a valuation date no sooner than the date of filing the complaint to condemn and no later than the date on which the condemning authority took title to the property. 735 ILCS 30/10-5-60.

This language appears to provide more protection to the landowner when the trial to condemn takes place long after the filing of the complaint to condemn. Other major changes from the former provisions of the Code of Civil Procedure for eminent domain proceedings focus on the general exercise of eminent domain power (735 ILCS 30/5-5-5), relocation expenses (735 ILCS 30/10-5-62), and attorneys’ fees (735 ILCS 30/10-5-110). These changes, while affecting other aspects of eminent domain, will not have a substantial effect on leasehold damages and awards. V. [10.22] CONCLUSION The impact of a leasehold interest in a condemnation proceeding begins with the condemnation clause in the lease. Once the contractual rights between the landlord and the tenant are ascertained, counsel must look to the law of eminent domain to determine whether damages exist to the leasehold and how those damages should be measured. VI. APPENDIX — SAMPLE FORMS A. Automatic Termination Clauses 1. [10.23] Condemnation Clause If, under the power of eminent domain, there shall be a permanent taking of the whole or any portion of the property so as to materially affect the permitted use of the property,



this agreement shall cease as of [and the rent shall be apportioned to] the date that pursuant thereto title shall be taken by the appropriating authority. In the event of any taking of a portion of the property that does not materially affect the permitted use of the property, this agreement shall continue in full force and effect, and the rent shall continue unabated. 2. [10.24] Compensation Clause All compensation awarded for the taking under the power of eminent domain, whether for the whole or a portion of the property, shall be the property of the landlord, except any compensation for the tenant’s moving expense, whether such damages shall be awarded as compensation for diminution in the value of or loss of the leasehold, for the diminution in the value of or loss of the fee of the property, or otherwise, and the tenant hereby assigns to the landlord all of the tenant’s rights, title, and interest in and to any and all such compensation. B. Condemnation Clauses 1. [10.25] Total Condemnation Clause If, during the term of this lease or any extension or renewal thereof, all of the premises should be taken for any public or quasi-public use under any law, ordinance, or regulation or by right of eminent domain or should be sold to a condemning authority under threat of condemnation, this lease shall terminate, and the rent shall be abated during the unexpired portion of this lease, effective as of the date of the taking of the premises by the condemning authority. 2. [10.26] Partial Condemnation Clause If, during the term of this lease or any extension or renewal thereof, less than all of the premises shall be taken for any public or quasi-public use under any law, ordinance, or regulation or by right of eminent domain or should be sold to a condemning authority under the threat of condemnation, the landlord shall have the option to (a) terminate this lease or (b) forthwith, at its sole expense, restore and reconstruct the building and other improvements situated on the premises, provided such restoration and reconstruction shall make them reasonably tenantable and suitable for the uses for which the premises are leased. The rent payable hereunder during the unexpired portion of this lease shall be adjusted equitably. C. [10.27] Sixty-Day Letter (To Be Sent by Certified Mail, Return Receipt Requested) [date] Dear [landowner]: As you have been previously informed, the State of Illinois, Department of ____________, proposes to [description of project]. This construction requires the acquisition of [description of property], consisting of ________ acres, which we find is owned by you.



The amount of compensation for the taking of your property by the Illinois Department of ____________ has been established at $________. A copy of the basis for computing the compensation and offer to purchase is enclosed. Pursuant to 735 ILCS 30/10-5-15, this Department is required to provide you with this certified letter at least 60 days before filing a petition with any court to initiate an eminent domain action. It is our intent, however, to continue to seek a negotiated agreement with you within this 60-day period and avoid litigation if at all possible. We are also required to inform you that, in the absence of a negotiated agreement, it is the intention of this Department to initiate eminent domain proceedings. Sincerely, ______________________________________ [condemning authority] D. [10.28] Tenant’s Waiver of Lease STATE OF ILLINOIS ) ) ss. COUNTY OF ____________ )

TENANT’S WAIVER OF LEASE Know all men by these presents, that [I] [we], tenant[s] of the County of ____________ and the State of Illinois, for and in consideration of One Dollar and other good and valuable considerations in hand paid, receipt of which is hereby acknowledged, do hereby remise, convey, relinquish, renounce, release, and quitclaim unto [condemning authority] of the County of ____________ and the State of Illinois all right, title, interest, claim, or demand whatsoever [I] [we] may have acquired under and by virtue of a certain lease duly executed by ____________ as Lessee[s] and ____________ as Lessor, said lease being dated ____________, and recorded in the Recorder’s Office of ____________ County in the State of Illinois, in Book ___ on Page ___. The demising premises are described as follows:

[legal description] Given under my hand and notarial seal [date]. _______________________________ (SEAL) _______________________________ (SEAL) Signed and sworn to before me on [date]. ______________________________________ Notary Public



E. [10.29] Cross-Complaint

[caption]

CROSS-COMPLAINT NOW COME Defendants, by their attorney ____________ of [firm], pursuant to 735 ILCS 30/10-5-10, as tenants of the real property being condemned and of the remaining real property, including the leasehold interest, and for their Cross-Complaint hereby state: 1. Plaintiff has filed a Complaint for Condemnation as follows:

[insert legal description of whole tract] 2. The tract of real property being condemned by Plaintiff includes a leasehold estate described as:

[describe] 3. The taking of the real property by Plaintiff will result in damages to the remainder of the real property not taken, and specifically to the leasehold interest, which will be adversely affected as follows:

[describe] WHEREFORE, for all the reasons set forth herein, Defendants, being the tenants of the leasehold estate, pray that their damages to the leasehold estate be assessed in these proceedings against Plaintiff and that a judgment for damages, expenses, and costs of this suit be entered against Plaintiff and in favor of Defendants. By: __________________________________ Attorney for Defendants [attorney information] F. [10.30] Motion for Separate Verdict

[caption]

MOTION FOR SEPARATE VERDICT NOW COMES Defendant, by its attorney, ____________ of [firm], and moves this Court for a separate verdict as to its leasehold damage arising from the acquisition of the property herein and in support states:



1. Defendant is vested with a leasehold interest in and to the property herein under a lease dated ____________, from the record titleholder of the property. A copy of said lease is attached hereto as Exhibit A. 2. By virtue of Defendant’s leasehold interest, Defendant has a compensable leasehold interest in and to the property and is entitled to have its leasehold damage herein established by a separate verdict. WHEREFORE, for all the foregoing reasons, Defendant respectfully requests that the jury impaneled herein return a separate verdict as to the leasehold damage sustained by this defendant incident to this acquisition. By: __________________________________ Attorney for Defendant [attorney information] G. [10.31] Motion for Apportionment of Condemnation Award

[caption]

MOTION FOR APPORTIONMENT OF CONDEMNATION AWARD

NOW COMES Defendant, by its attorney, ____________ of [firm], and respectfully represents: 1. Defendant is a party in the above-captioned condemnation action. 2. On [date], a judgment was entered in this action setting the amount of just compensation for the taking of the fee simple title to the property as described in the Complaint To Condemn at $____________. 3. On [date], the award of just compensation was deposited with the ____________ County Treasurer for the benefit of the owners and parties interested in said property. 4. Defendant is the lessee of the said premises condemned, holding its leasehold interest pursuant to a lease dated ____________, and executed by ____________. A true and accurate copy of the lease is attached hereto as Exhibit A. 5. Defendant, as lessee of the subject property, is entitled to an apportionment of the condemnation award for the value of its interest in the property condemned pursuant to 735 ILCS 30/10-5-90.



WHEREFORE, for all the foregoing reasons, it is respectfully requested that this Motion for Apportionment be set for hearing and that the Court enter an order awarding Defendant the amount of its leasehold damage sustained by virtue of the acquisition of the property. By: __________________________________ Attorney for Defendant [attorney information]


Federal Eminent Domain Practice ROBERT J. WILL PATRICK J. THORNTON Lewis Rice LLC St. Louis, MO

11



I. [11.1] Scope of Chapter II. [11.2] Federal Power To Condemn A. [11.3] Purpose B. [11.4] What Constitutes a Taking C. [11.5] When Power Is Exercised D. [11.6] Federal Authorities Having Power To Condemn E. [11.7] Governing Law F. [11.8] Federal Policy on Real Property Acquisition and Use of Federal Funds —

Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970

G. Limitations on Power of Eminent Domain 1. [11.9] Just Compensation 2. [11.10] Public Use 3. [11.11] Necessity and Expediency of Taking 4. [11.12] Temporary Takings 5. [11.13] Air Installations Compatible Use Zones Program III. Valuation and Damages A. [11.14] Rules of Just Compensation B. [11.15] Measure of Compensation C. [11.16] Non-Compensable Elements D. Evidence of Value 1. [11.17] Comparable Sales 2. [11.18] Prior Sales 3. [11.19] Highest and Best Use 4. [11.20] Subdivision Approach 5. [11.21] Business Income 6. [11.22] Tax Assessments 7. [11.23] Offers 8. [11.24] Separate Values of Improvements 9. [11.25] Zoning Restrictions 10. [11.26] Prices Paid by Condemnor 11. [11.27] Consequential Damages When No Property Is Taken 12. [11.28] Setoff

FEDERAL EMINENT DOMAIN PRACTICE


IV. Possession and Title A. [11.29] Inverse Condemnation B. [11.30] Declaration of Taking Act V. [11.31] Procedure in Federal Condemnation A. [11.32] Jurisdiction and Venue B. [11.33] Joinder of Properties C. [11.34] Complaint D. [11.35] Process E. [11.36] Appearance or Answer F. [11.37] Objections and Defenses G. [11.38] Amendment of Pleadings, Substitution of Parties, and Dismissal H. [11.39] Burden of Proof I. [11.40] Discovery J. [11.41] Methods and Conduct of Trial 1. [11.42] Trial by Tribunal of Issue of Just Compensation 2. [11.43] Trial by Jury of Issue of Just Compensation 3. [11.44] Trial by Commission of Issue of Just Compensation 4. [11.45] Trial by District Court of All Other Issues K. [11.46] Court Costs 1. [11.47] Equal Access to Justice Act 2. [11.48] Costs Pursuant to 42 U.S.C. §4654(a) 3. [11.49] Federal Rule of Civil Procedure 68 Costs L. [11.50] Abandonment VI. Remedies of Interest Holders Neither Paid nor Proceeded Against A. [11.51] Tucker Act B. [11.52] Injunction C. [11.53] Ejectment D. [11.54] Trespass VII. [11.55] Relocation Payments: Uniform Relocation Assistance and Real Property

Acquisition Policies Act of 1970 A. [11.56] Moving and Related Expenses B. [11.57] Replacement Housing for Homeowners C. [11.58] Replacement Housing for Tenants



D. [11.59] Relocation Assistance Service E. [11.60] State Assistance or Involvement in Project F. [11.61] Payments Not To Be Considered Income VIII. Revestments, Exchanges, and Disposals A. [11.62] Revestments B. [11.63] Exchanges C. [11.64] Disposals IX. Appendix — Sample Forms A. Forms Relating to Declaration of Taking 1. [11.65] Declaration of Taking 2. [11.66] Petition for Distribution of Deposit 3. [11.67] Order for Distribution 4. [11.68] Petition of Owners for Payment of Deposit for Taxes, for Lien, and to

Owners B. [11.69] Complaint in Condemnation C. [11.70] Notice of Condemnation D. [11.71] Answer to Complaint E. [11.72] Appearance

FEDERAL EMINENT DOMAIN PRACTICE §11.3


I. [11.1] SCOPE OF CHAPTER The first general statute by Congress authorizing the filing of condemnation cases in federal courts was enacted on August 1, 1888, and recodified as 40 U.S.C. §3113 on August 21, 2002. Although the power of eminent domain was well known when the Constitution was adopted, it was not put to early use because of doubts as to whether the power, which had not been specifically granted to the United States in the Constitution, could exist independently in the federal government. Cong. Globe, 36th Cong., 1st Sess. 1790 – 1792, 3297 (1860). Eminent domain was not exercised adversely by the federal government in the federal courts until 1873. Kohl v. United States, 91 U.S. (1 Otto) 367, 23 L.Ed. 449 (1875). This chapter outlines the history and procedures of federal condemnation for a general practitioner. II. [11.2] FEDERAL POWER TO CONDEMN The power of eminent domain is derived from the sovereignty of the United States and is a power granted by the Fifth Amendment of the Constitution rather than a right. The United States may take property either by (a) entering into physical possession without a court order (see §§11.29 and 11.30 below) or (b) instituting condemnation proceedings (see §§11.31 – 11.50 below). A. [11.3] Purpose Eminent domain is essential to the government to ensure that the real estate requirements for any given project can be met. Without the right to condemn, very few, if any, public works projects could be completed. However, the government’s exercise of its eminent domain authority is, as it should be, the “last resort” method of acquisition. The objective of the government is twofold: to acquire necessary interests in land in a timely and orderly manner at its fair market value — fair to the owner and fair to the government. For example, settlements or awards that are greatly in excess of values being paid for direct purchases can undermine the voluntary conveyances and result in larger numbers of condemnations. A condemnation proceeding is an in rem proceeding. The vesting of title is accomplished either (1) by straight condemnation or (2) by a declaration of taking (an ancillary proceeding). In a straight condemnation, title does not vest until the award is fixed and has been deposited with the court. However, a declaration of taking accelerates the vesting of title to the time of the filing of the declaration and the depositing of the estimated compensation with the court. 40 U.S.C. §3114; In re United States Praying for Writ of Mandamus or Writ of Prohibition, 257 F.2d 844 (5th Cir.), cert. denied, 79 S.Ct. 234 (1958). The remaining function is to provide a means by which the constitutional requirement that just compensation be paid for property taken will be fully met to ensure that (1) all parties having a compensable interest in the property are precluded by the judgment fixing compensation so that future claims are forever barred; and (2) the fixed award covers the whole property that is being taken.



B. [11.4] What Constitutes a Taking The Fifth Amendment of the U.S. Constitution applies only to takings. As a consequence, the scope of the federal government’s constitutional liability for property interests damaged by virtue of governmental activity is not as extensive as that of the state. For damages to be recoverable in federal condemnation cases, the damage must be “so complete as to deprive the owner of all or most of his interest in the subject matter, to amount to a taking.” United States v. General Motors Corp., 323 U.S. 373, 89 L.Ed. 311, 65 S.Ct. 357, 359 – 360 (1945). The taking occurs 1. at the time of assumption of possession, either actual or constructive; 2. at the date of the transfer of title to the condemnor; 3. by the filing of a declaration of taking; or 4. at the entry of a final judgment in the case. Whichever of the above events occurs first determines the date of taking. United States v. Dow, 357 U.S. 17, 2 L.Ed.2d 1109, 78 S.Ct. 1039 (1958); In re United States Praying for Writ of Mandamus or Writ of Prohibition, 257 F.2d 844 (5th Cir.), cert. denied, 79 S.Ct. 234 (1958). C. [11.5] When Power Is Exercised The power of eminent domain is exercised when, and by agents to whom, authority has been expressly or impliedly granted by Congress, but consent of the state is not necessary; neither can the state control how the power shall be exercised. Mitchell v. United States, 267 U.S. 341, 69 L.Ed. 644, 45 S.Ct. 293 (1925); United States v. North American Transportation & Trading Co., 253 U.S. 330, 64 L.Ed. 935, 40 S.Ct. 518 (1920); Luxton v. North River Bridge Co., 153 U.S. 525, 38 L.Ed. 808, 14 S.Ct. 891 (1894). The right of eminent domain is the offspring of political necessity and is inseparable from sovereignty unless denied by fundamental law; it cannot be exercised except on the condition that just compensation be paid. Searl v. School Dist. No. 2, 133 U.S. 553, 33 L.Ed. 740, 10 S.Ct. 374 (1890). In addition, this power is not a paramount property right of the sovereign but a power essential to the independent existence of the sovereign growing out of the necessity of its being. Shoemaker v. United States, 147 U.S. 282, 37 L.Ed. 170, 13 S.Ct. 361 (1893); United States v. 58.16 Acres of Land, More or Less, Situated in Clinton County, State of Illinois, 478 F.2d 1055 (7th Cir. 1973). D. [11.6] Federal Authorities Having Power To Condemn Congress may not delegate to administrative agencies its constitutional power. A.L.A. Schechter Poultry Corp. v. United States, 295 U.S. 495, 79 L.Ed. 1570, 55 S.Ct. 837 (1935). It may, however, delegate the function of carrying out the power of eminent domain. President, Managers & Company of Monongahela Bridge Co. v. United States, 216 U.S. 177, 54 L.Ed. 435, 30 S.Ct. 356 (1910). Moreover, the power to condemn may be delegated to private parties. Luxton v. North River Bridge Co., 153 U.S. 525, 38 L.Ed. 808, 14 S.Ct. 891 (1894). Heads of federal agencies are empowered to request the Attorney General to institute condemnation proceedings



when Congress has authorized the taking. 40 U.S.C. §3113. As always, the delegatee is bound to devote the property so taken to the “public use.” Id. E. [11.7] Governing Law Most condemnation proceedings in federal courts are brought under the federal government’s power of eminent domain. In these cases, federal substantive law determines the disposition of most issues. United States v. 93.970 Acres of Land, 360 U.S. 328, 3 L.Ed.2d 1275, 79 S.Ct. 1193 (1959); United States v. Certain Interests in Property in Champaign County, State of Illinois, 271 F.2d 379 (7th Cir. 1959), cert. denied, 80 S.Ct. 1058 (1960). For example, the determination of what constitutes “property” is a federal question even though the federal courts will normally look to local law to ascertain its limits as a compensable interest. United States ex rel. Tennessee Valley Authority v. Powelson, 319 U.S. 266, 87 L.Ed. 1390, 63 S.Ct. 1047 (1943). State law controls when no federal interest or rights are involved, as in a dispute between a mortgagor and a mortgagee concerning their respective rights to an award. Swanson v. United States, 156 F.2d 442 (9th Cir. 1946), cert. denied, 67 S.Ct. 492 (1947). As mentioned above, an overwhelming number of condemnation cases brought into the federal courts involve the federal power of eminent domain, but some cases (i.e., those instituted in federal court or removed on the basis of diversity or alienage) involve a state’s exercise of its power of eminent domain. In either case, federal procedure is followed, but any substantive law issues involving the substantive right of a litigant attached by state law should be observed and followed when the proceeding is a state condemnation. City of Thibodaux v. Louisiana Power & Light Co., 373 F.2d 870 (5th Cir.), cert. denied, 88 S.Ct. 476 (1967). F. [11.8] Federal Policy on Real Property Acquisition and Use of Federal Funds —

Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970

In 1971, Congress enacted into law a uniform policy for acquisitions of real property — the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (URA), Pub.L. No. 91-646, 84 Stat. 1894. Regulations implementing the provisions of the URA may be found at 49 C.F.R. pt. 24. Importantly, the URA applies not only when the federal government is the acquiring entity, but also when real property is acquired for a project that has or will receive federal funding, even if the funds themselves are not used with real property acquisition activities. All recipients of federal aid must comply or risk the loss of federal funding. Given the high stakes of noncompliance, it is imperative to familiarize oneself with the requirements of the URA and the implementing regulations before proceeding forward in any eminent domain matter in which federal funds are involved. Among other things, the URA emphasizes resolving condemnation actions through negotiation and without coercive practices by the government. A 90-day written notice must be given to anyone who must move a residence or business as a consequence of a condemnation that is subject to URA requirements. 49 C.F.R. §24.203(c). The URA also establishes detailed



guidelines for the valuation of property, including requirements for the preparation of appraisals and review of appraisals in compliance with the Uniform Standards of Professional Appraisal Practice (USPAP) (updated annually; available from the Appraisal Foundation) and the Uniform Appraisal Standards for Federal Land Acquisitions (5th ed. 2000) (also known as the Yellow Book), as well as for the determination of just compensation. The URA enhances the negotiation position of the condemnee in a federal or federally assisted condemnation. Among other things, the acquiring agency must provide the landowner with the opportunity to accompany the agency’s appraiser during the inspection, to offer fair value for the property before entering into negotiations, and to provide the condemnee with a written statement summarizing the process by which the figure offered as just compensation was reached. The URA provides for recovery of litigation and other expenses in certain situations. In any condemnation involving use of federal funds, reference should also be made to 1. the Code of Federal Regulations to ascertain specific rules and regulations, if any, that a

particular agency may follow in applying URA requirements to its acquisitions program; and

2. specific enabling legislation for a particular project, if applicable, that may impose

separate conditions on the use of federal funds that are ordinarily enforceable even when beyond Congress’ enumerated powers.

See Fullilove v. Klutznick, 448 U.S. 448, 65 L.Ed.2d 902, 100 S.Ct. 2758, 2772 – 2773 (1980); Lau v. Nichols, 414 U.S. 563, 39 L.Ed.2d 1, 94 S.Ct. 786, 789 – 790 (1974); United States v. Butler, 297 U.S. 1, 80 L.Ed. 477, 56 S.Ct. 312, 319, 322 (1936). While the power to impose conditions on the use of federal funds is not limitless, the scope of limitation remains unclear at best. See Pennhurst State School & Hospital v. Halderman, 451 U.S. 1, 67 L.Ed.2d 694, 101 S.Ct. 1531, 1545 – 1546 (1981); South Dakota v. Dole, 483 U.S. 203, 97 L.Ed.2d 171, 107 S.Ct. 2793, 2796 – 2797 (1987); Arlington Central School District Board of Education v. Murphy, 548 U.S. 291, 165 L.Ed.2d 526, 126 S.Ct. 2455, 2458 – 2459 (2006). For additional discussion of the URA in the context of relocation benefits, see §§11.55 – 11.61 below. In response to the Supreme Court’s decision in Kelo v. City of New London, Connecticut, 545 U.S. 469, 162 L.Ed.2d 439, 125 S.Ct. 2655 (2005), which primarily affects state eminent domain laws, President George W. Bush issued Executive Order No. 13,406 (June 23, 2006), 71 Fed.Reg. 36,973 (June 28, 2006), prohibiting federal agencies from taking private property except for public projects. The types of projects that the Executive Order indicates justify the taking of private property include parks, roads, medical facilities, government office buildings, and utilities. Takings would also be allowed to prevent land uses that are harmful to the environment or public safety or to acquire abandoned property. Executive Order No. 13,406 applies only to federal government agencies and projects and does not include a funding ban.



G. Limitations on Power of Eminent Domain 1. [11.9] Just Compensation Payment of just compensation is an essential element of the exercise of the power of eminent domain. See U.S.CONST. amend. V. 2. [11.10] Public Use Private property can be taken for public use only. Midkiff v. Tom, 702 F.2d 788 (9th Cir. 1983), rev’d on other grounds sub nom. Hawaii Housing Authority v. Midkiff, 104 S.Ct. 2321 (1984). Federal law follows a liberal definition of “public use.” Generally, the federal courts have held that “public use” means “public benefit.” The federal government may properly take private property by eminent domain in aid of any of the powers either expressly or impliedly granted to it by the Constitution. It is not essential that the entire community or even any considerable portion should directly enjoy or participate in any improvement to constitute a public use within the law of eminent domain. Rindge Co. v. Los Angeles County, 262 U.S. 700, 67 L.Ed. 1186, 43 S.Ct. 689 (1923). It is also not necessary that the land taken for the public use remain under government ownership. Berman v. Parker, 348 U.S. 26, 99 L.Ed. 27, 75 S.Ct. 98 (1954). While the determination of whether a use is public is a judicial question, the presumption is that a use is public if the legislature has declared it to be such. The party challenging the character of the use has the burden to show clearly that the particular undertaking has no substantial relation to the public welfare. Berman, supra. See also Barbian v. Panagis, 694 F.2d 476 (7th Cir. 1982). Thus, in Clark v. Nash, 198 U.S. 361, 49 L.Ed. 1085, 25 S.Ct. 676 (1905), the Court upheld the constitutionality of a statute permitting the condemnation of land for the irrigation of other land belonging to a private person when the condemnation was pursuant to the declared policy of the state. 3. [11.11] Necessity and Expediency of Taking In general, questions as to the necessity or expediency of a taking are not reviewable by the courts. See Berman v. Parker, 348 U.S. 26, 99 L.Ed. 27, 75 S.Ct. 98 (1954); State of Georgia v. City of Chattanooga, 264 U.S. 472, 68 L.Ed. 796, 44 S.Ct. 369 (1924); United States v. 16.92 Acres of Land, 670 F.2d 1369, 1371 (7th Cir. 1982); United States v. 416.81 Acres of Land, 514 F.2d 627 (7th Cir. 1975); Joslin Mfg. Co. v. City of Providence, 262 U.S. 668, 67 L.Ed. 1167, 43 S.Ct. 684 (1923). The discretionary determination by the condemning authority as to the extent of the take is not reviewable by the court. Narramore v. United States, 960 F.2d 1048 (Fed.Cir. 1992); United States v. 21.54 Acres of Land, More or Less, Situate in Marshall County, State of West Virginia, 491 F.2d 301 (4th Cir. 1973). The U.S. Supreme Court has stated that arbitrariness, capriciousness, and bad faith can bar a taking, but they must be affirmatively proved by a showing of substantial evidence. United States



v. Carmack, 329 U.S. 230, 91 L.Ed. 209, 67 S.Ct. 252 (1946); United States v. 49.79 Acres of Land, More or Less, Situate in New Castle County, State of Delaware, 582 F.Supp. 368 (D.Del. 1983). See also United States v. 40.75 Acres of Land, More or Less, Situate in DuPage County, Ill., 76 F.Supp. 239 (N.D.Ill. 1948). However, an authorized official’s determination that a taking was necessary has never been rejected on these grounds by a federal court. 4. [11.12] Temporary Takings Temporary takings occur when the United States acquires the right to use and occupy property temporarily for a public purpose. They are often referred to as “lease takings” or “temporary construction easements”; they are the right to use and occupy property for a set period of time. Temporary takings may involve a. the lease of bare land; b. the lease of an entire office building; c. the lease of one floor of an office building; d. a temporary construction easement to enable a public work to be constructed; e. properties that are vacant and unoccupied; f. properties that are occupied by the owner or a lessee; and g. government-induced flooding (Arkansas Game & Fish Commission v. United States, ___

U.S. ___, 184 L.Ed.2d 417, 133 S.Ct. 511 (2012)). The valuation of temporary takings is based on fair market rent — the amount that would have been received for the period of the temporary taking. United States v. 564.54 Acres of Land, More or Less, Situated in Monroe & Pike Counties, Pennsylvania, 441 U.S. 506, 60 L.Ed.2d 435, 99 S.Ct. 1854, 1857 (1979), citing Kimball Laundry Co. v. United States, 338 U.S. 1, 93 L.Ed. 1765, 69 S.Ct. 1434, 1437 (1949). 5. [11.13] Air Installations Compatible Use Zones Program The concept of Air Installations Compatible Use Zones (AICUZ) was developed by the U.S. Department of Defense for coordinating and developing uses in the vicinity of military air bases that are compatible with both military and community needs for the property. The AICUZ program consists of specific studies of each air base in an effort to examine and evaluate the effects of aircraft noise and accident potential and to develop a planning mechanism that will ensure that the health, safety, and welfare of the citizens of the surrounding communities and the operational capabilities of the air base are protected. The major goals of the AICUZ program include reducing (a) the impact of aircraft noise over private properties and (b) the risk of physical danger to people caused by aircraft crashes. These goals are often accomplished by restricting allowable uses on private property that is within the zone or area as determined by an AICUZ study. Another method of accomplishing these goals is to acquire an AICUZ easement,



which is in the nature of a zoning ordinance. This easement restricts the uses to which private landowners can put their property. See Stephens v. United States, 11 Cl.Ct. 352 (1986). Most often, an AICUZ easement is acquired either to prevent the imminent development of property with an approved subdivision plan or to prevent the further development of an existing subdivision. An appraisal of an easement is necessarily based on the rights acquired by the government and those left to the landowners. The obvious problem in valuing the AICUZ easement is finding an existing AICUZ easement sale in the open market with which to compare. One approach is to make a comparison to a similar property that has sold — both subject to and free of other types of restrictive uses — to develop guidelines as to the general valuation effect of restriction easements. See Branning v. United States, 654 F.2d 88 (Ct.Cl. 1981); Hero Lands Co. v. United States, 554 F.Supp. 1262 (Cl.Ct.), aff’d, 727 F.2d 1118 (Fed.Cir. 1983), cert. denied, 104 S.Ct. 2346 (1984). Claims for compensation arising from an AICUZ easement are subject to a six-year statute of limitations. 28 U.S.C. §2501; Goodman v. United States, 100 Fed.Cl. 289 (2011). III. VALUATION AND DAMAGES A. [11.14] Rules of Just Compensation The rules of compensation are judicial in nature. It is within the court’s power to determine what just compensation is. United States v. New River Collieries Co., 262 U.S. 341, 67 L.Ed. 1014, 43 S.Ct. 565 (1923); Monongahela Navigation Co. v. United States, 148 U.S. 312, 37 L.Ed. 463, 13 S.Ct. 622 (1893). The court’s power to determine the rules of compensation stems from the Fifth Amendment to the U.S. Constitution, which provides that “private property [shall not] be taken for public use, without just compensation.” [Emphasis added.] This provision of the Constitution requires the payment of compensation but does not define it. Federal and state rules of compensation are not necessarily the same. State of Nebraska v. United States, 164 F.2d 866 (8th Cir. 1947), cert. denied, 68 S.Ct. 1070 (1948). There is no constitutional requirement that they be the same. Therefore, state law cannot be resorted to in determining just compensation since the right to compensation is grounded on the U.S. Constitution. United States v. Miller, 317 U.S. 369, 87 L.Ed. 336, 63 S.Ct. 276 (1943). B. [11.15] Measure of Compensation Early on, courts adopted the fair market value concept of compensation. McCandless v. United States, 298 U.S. 342, 80 L.Ed. 1205, 56 S.Ct. 764 (1936). “Market value” has been defined as the value that informed persons would agree to between themselves, being under no compulsion either to buy or to sell. United States v. Miller, 317 U.S. 369, 87 L.Ed. 336, 63 S.Ct. 276 (1943); Olson v. United States, 292 U.S. 246, 78 L.Ed. 1236, 54 S.Ct. 704 (1934); United States v. Douglas, 207 F.2d 381 (9th Cir. 1953), cert. denied, 74 S.Ct. 520 (1954). It is the owner’s loss, not the taker’s gain, that is the measure of the value of the property taken. United States v. Causby, 328 U.S. 256, 90 L.Ed. 1206, 66 S.Ct. 1062 (1946). Market value is measured at the time of taking and in money contemporaneously paid with the taking. Olson, supra; Jacobs v. United States, 290 U.S. 13, 78 L.Ed. 142, 54 S.Ct. 26 (1933). “Contemporaneously paid” means that if there is any delay in the payment of all or part of the compensation beyond the date of taking, interest shall be paid. Seaboard Air Line Ry. v. United States, 261 U.S. 299, 67 L.Ed.



664, 43 S.Ct. 354 (1923). Interest is a part of just compensation itself. Otherwise, the United States could not be held liable for interest except as provided by statute. Smyth v. United States, 302 U.S. 329, 82 L.Ed. 294, 58 S.Ct. 248 (1937). See 40 U.S.C. §§3114 and 3116 to calculate interest as part of just compensation. Just compensation includes all elements of value that inhere in the property, but it does not exceed market value fairly determined. Cudahy Bros. v. United States, 155 F.2d 905, 906 – 907 (7th Cir. 1946). See also In re Gifford, 688 F.2d 447, 458 (7th Cir. 1982); United States v. 45,131.44 Acres of Land, More or Less, in El Paso, Fremont & Pueblo Counties, State of Colorado, 483 F.2d 569, 572 (10th Cir. 1973); United States v. 50 Acres of Land, 469 U.S. 24, 83 L.Ed.2d 376, 105 S.Ct. 451 (1984). The compensation to be awarded includes not only the market value of that part of the tract appropriated, but the damage to the remaining portion of the tract resulting from that taking. United States v. Grizzard, 219 U.S. 180, 55 L.Ed 165, 31 S.Ct. 162 (1911). The burden in such cases is proving that the entire tract was used and treated as a single entity. See Winn v. United States, 272 F.2d 282, 286 (9th Cir. 1959). C. [11.16] Non-Compensable Elements The following elements are non-compensable in fixing just compensation under federal law: 1. consequential or incidental damages (United States v. Petty Motor Co., 327 U.S. 372, 90

L.Ed. 729, 66 S.Ct. 596 (1946); Almota Farmers Elevator & Warehouse Co. v. United States, 409 U.S. 470, 35 L.Ed.2d 1, 93 S.Ct. 791 (1973));

2. an owner’s cost or investment (United States ex rel. Tennessee Valley Authority v.

Powelson, 319 U.S. 266, 87 L.Ed. 1390, 63 S.Ct. 1047 (1943)); 3. business losses or frustration of plans (Omnia Commercial Co. v. United States, 261 U.S.

502, 67 L.Ed. 773, 43 S.Ct. 437 (1923)); 4. goodwill or going-concern value (Joslin Mfg. Co. v. City of Providence, 262 U.S. 668, 67

L.Ed. 1167, 43 S.Ct. 684 (1923)); 5. moving expenses, generally (United States v. General Motors Corp., 323 U.S. 373, 89

L.Ed. 311, 65 S.Ct. 357 (1945)); 6. special value to the owner (United States v. 564.54 Acres of Land, More or Less, Situated

in Monroe & Pike Counties, Pennsylvania, 441 U.S. 506, 60 L.Ed.2d 435, 99 S.Ct. 1854, 1857 (1979); United States v. Cors, 337 U.S. 325, 93 L.Ed. 1392, 69 S.Ct. 1086 (1949));

7. value attributed to the needs of the government (United States v. Miller, 317 U.S. 369, 87

L.Ed. 336, 63 S.Ct. 276 (1943)); 8. values inherent in navigable waters (United States v. Chandler-Dunbar Water Power Co.,

229 U.S. 53, 57 L.Ed. 1063, 33 S.Ct. 667 (1913));



9. expenses of securing appraisals (United States v. Bodcaw Co., 440 U.S. 202, 59 L.Ed.2d 257, 99 S.Ct. 1066 (1979); see also Kirby Forest Industries, Inc. v. United States, 467 U.S. 1, 81 L.Ed.2d 1, 104 S.Ct. 2187 (1984));

10. homeowner associations’ assessments (United States v. 0.073 Acres of Land, More or

Less, Situate in Parishes of Orleans and Jefferson, State of Louisiana, 705 F.3d 540 (5th Cir. 2013));

11. fees of expert witnesses (Bodcaw, supra); and 12. attorneys’ fees (Dohany v. Rogers, 281 U.S. 362, 74 L.Ed. 904, 50 S.Ct. 299 (1930)). D. Evidence of Value 1. [11.17] Comparable Sales In United States v. Whitehurst, 337 F.2d 765, 775 (4th Cir. 1964), the court recognized comparable sales as the best evidence of value:

It is settled law that comparable sales are the best evidence of value. . . . Real property may be unique and the comparable sales too few to establish a conclusive market price, “but that does not put out of hand the bearing which the scattered sales may have on what an ordinary purchaser would have paid for the claimant’s property.” [Citations omitted.] Quoting United States v. Toronto, Hamilton & Buffalo Naviation Co., 338 U.S. 396, 94 L.Ed. 195, 70 S.Ct. 217, 221 (1949).

Comparable sales are admissible in direct examination as substantial proof of the fair market value of the subject property. United States v. Lowrie, 246 F.2d 472 (4th Cir. 1957). A foundation must be laid showing that the sale (a) was sufficiently near the subject; (b) was sufficiently like it in character, situation, usability, and improvement; and (c) was traded on the open market at a time not too remote from the present taking. United States v. Johnson, 285 F.2d 35 (9th Cir. 1960). The question of similarity is a preliminary question of fact, the solution of which rests largely within the discretion of the trial judge. United States v. 190.71 Acres of Land in Lake County, Illinois, 300 F.2d 52 (7th Cir. 1962). Comparable sales are also admissible as background for or in support of opinion testimony rather than as independent evidence of value, in which event the requirement of comparability is less strict. Johnson, supra. A sale on foreclosure or a similar forced transaction not on an open market is without probative value as a matter of law because elements of compulsion so affect the sale that it cannot be considered to represent market value fairly at the time made. Hickey v. United States, 208 F.2d 269 (3d Cir. 1953), cert. denied, 74 S.Ct. 519 (1954). A comparable sale is not under compulsion, coercion, or compromise if the witness testifies or it is otherwise shown that the public records do not disclose that the sale was (a) at foreclosure, (b) under deed of trust securing an indebtedness, (c) at execution or attachment, (d) at auction, or (e) under pressure or the exercise of eminent



domain or other types of legal compulsion generally disclosed by public records. District of Columbia Redevelopment Land Agency v. 61 Parcels of Land in Squares 585, 586, 643 & E-643, in District of Columbia, 235 F.2d 864 (D.C.Cir. 1956). Evidence of sales of property must be sales for cash or its equivalent; other property received as part of the consideration would necessitate a determination of the value of the other property and interject a collateral issue into the trial. United States v. Leavell & Ponder, Inc., 286 F.2d 398 (5th Cir.), cert. denied, 81 S.Ct. 1674 (1961). Notwithstanding that the records are not produced or a person who participated in the sales is not called as a witness, the hearsay and best evidence rules cannot be applied to prevent an expert witness from giving, in a reasonable way, the basis for an opinion as to value based on comparable sales. Lowrie, supra. 2. [11.18] Prior Sales A prior sale of the subject property constitutes but one transaction and is to be considered along with all the other evidence in the case in determining fair market value. A prior sale of the subject property is not to be accorded more weight, as a matter of law, than sales of comparable property. Hickey v. United States, 208 F.2d 269, 273 (3d Cir. 1953), cert. denied, 74 S.Ct. 519 (1954). The price paid by a defendant for the condemned property, even if the purchase was recent, is not necessarily indicative of its fair market value. United States v. Toronto, Hamilton & Buffalo Navigation Co., 338 U.S. 396, 94 L.Ed. 195, 70 S.Ct. 217 (1949). The trial court has discretion in admitting evidence of the sale of the immediate property even though considerable time has elapsed since the sale. United States v. Becktold Co., 129 F.2d 473 (8th Cir. 1942); United States v. 428.02 Acres of Land, More or Less, Situate in Newton & Searcy Counties, Arkansas, 687 F.2d 266 (8th Cir. 1982). In fact, remoteness in point of time goes to the weight of the evidence and not to its admissibility. Dickinson v. United States, 154 F.2d 642 (4th Cir. 1946). 3. [11.19] Highest and Best Use In determining market value, the highest and best use for which the property is adaptable and needed or is likely to be needed in the near future is to be considered. United States v. 46,672.96 Acres of Land, More or Less, Situate in Dona Ana, et al., Counties, State of New Mexico, 521 F.2d 13 (10th Cir. 1975). Ordinarily, the highest and best use of property condemned is the use to which it is devoted at the time of taking. Olson v. United States, 292 U.S. 246, 78 L.Ed. 1236, 54 S.Ct. 704 (1934). If the credible evidence shows that a different highest and best use is probable at the date of taking, then the different use may “be considered, not necessarily as the measure of value, but to the full extent that the prospect of demand for such use affects the market value while the property is privately held.” 54 S.Ct. at 709. However, the mere possibility of a more profitable use may not be considered by the trier of fact. United States ex rel. Tennessee Valley Authority v. 1.72 Acres of Land in Tennessee, 821 F.3d 742 (6th Cir. 2016). See also United States v. 77,819.10 Acres of Land, More or Less, Situate in Socorro & Catron Counties, New Mexico, 647 F.2d 104 (10th Cir. 1981), cert. denied, 102 S.Ct. 1971 (1982).



4. [11.20] Subdivision Approach The subdivision approach to value is generally the most speculative approach to the valuation of real estate. Market evidence to support retail lot values must be presented. The following costs must be considered: a. surveying; b. construction of utilities; c. road construction; d. legal fees; e. selling expenses; f. developer’s profit; g. overhead; and h. carrying costs of taxes and interest. While highest and best use is the threshold question in appraising value (United States v. Meyer, 113 F.2d 387 (7th Cir.), cert. denied, 61 S.Ct. 174 (1940)), the appraiser must also look to the likelihood of the property being subdivided (Olson v. United States, 292 U.S. 246, 78 L.Ed. 1236, 54 S.Ct. 704 (1934)). 5. [11.21] Business Income Income is generally inadmissible to prove value if the property is the type that is subject to sale and there are sufficient transactions on the open market to indicate a market. United States v. 428.02 Acres of Land, More or Less, Situate in Newton & Searcy Counties, Arkansas, 687 F.2d 266 (8th Cir. 1982); United States v. Meyer, 113 F.2d 387 (7th Cir.), cert. denied, 61 S.Ct. 174 (1940). Rentals paid for similar property are admissible if all the characteristics of comparability are apparent in the properties. See McCandless v. United States, 74 F.2d 596 (9th Cir. 1935), rev’d on other grounds, 56 S.Ct. 764 (1936). 6. [11.22] Tax Assessments Assessments are inadmissible to show value. Murdock v. United States, 160 F.2d 358 (8th Cir. 1947). Admissions in tax returns are admissible and should be distinguished from the inadmissibility of an assessed valuation contained in an assessment list. See McCandless v. United States, 74 F.2d 596 (9th Cir. 1935), rev’d on other grounds, 56 S.Ct. 764 (1936). This distinction is based on the theory that tax assessment lists are made by the assessor, while tax return statements under oath are made by an owner pursuant to circumstances under which it is incumbent on the owner to tell the truth.



7. [11.23] Offers The following offers are inadmissible to establish market value: a. unaccepted offers (Sharp v. United States, 191 U.S. 341, 48 L.Ed. 211, 24 S.Ct. 114

(1903)); b. offers to compromise (Home Insurance Co. v. Baltimore Warehouse Co., 93 U.S. (3

Otto) 527, 23 L.Ed. 868 (1876)); and c. offers by the condemnor (Washington Metropolitan Area Transit Authority v. One Parcel

of Land in Montgomery County, Maryland, 548 F.2d 1130 (4th Cir. 1977)). 8. [11.24] Separate Values of Improvements Evidence as to the value of the improvements can be given only to the extent that they enhance the value of the land on which they are located. Devou v. City of Cincinnati, 162 F. 633 (6th Cir.), cert. denied, 29 S.Ct. 685 (1908). The improvements must also conform to the highest and best use for the land and be reasonably adapted thereto. United States v. Benning Housing Corp., 276 F.2d 248 (5th Cir. 1960). The original cost of the improvements is admissible if the improvements a. are properly adapted to the land; b. are in common ownership with the land; and c. are not too remote in time from the date of taking. Stephenson Brick Co. v. United States

ex rel. Tennessee Valley Authority, 110 F.2d 360 (5th Cir. 1940). 9. [11.25] Zoning Restrictions Comparable sales of property zoned for different uses are inadmissible to show value unless the defendant first demonstrates that a reasonable probability of rezoning to a similar category existed on the date of taking. The property owner has the burden of proving that a reasonable probability of rezoning existed on the date of taking. United States v. Certain Land in Baltimore County, State of Maryland, 209 F.Supp. 50 (D.Md. 1962). 10. [11.26] Prices Paid by Condemnor Prices paid by the condemnor in other condemnation proceedings are not admissible as evidence of value. Evidence as to the price paid by the same or another condemning agency for other real property that, although subject to condemnation, was sold by the owner without the intervention of eminent domain proceedings, is admissible to prove the value of the real property involved. United States v. 13,255.53 Acres of Land in Burlington & Ocean Counties, N.J., 158 F.2d 874 (3d Cir. 1946). When the fact that the parties were the condemnor and condemnee either was not known or had no influence because the sale was not with or in anticipation of condemnation proceedings, the foregoing rule did not apply. Slattery Co. v. United States, 231 F.2d 37 (5th Cir. 1956).



11. [11.27] Consequential Damages When No Property Is Taken The Fifth Amendment to the U.S. Constitution guarantees compensation for a taking only. When no part of the property has been physically appropriated, federal law generally does not allow compensation for damages arising as a consequence of a federal project. United States v. Causby, 328 U.S. 256, 90 L.Ed. 1206, 66 S.Ct. 1062 (1946). Thus, in Ettor v. City of Tacoma, 228 U.S. 148, 57 L.Ed. 773, 33 S.Ct. 428 (1913), the Court held that the owner of land abutting a public road had no constitutional right to compensation for damages caused by the lowering of the road grade when no part of his property was appropriated. 12. [11.28] Setoff In partial taking cases, the condemnor will sometimes contend that the construction of the public improvement will result in a benefit to the land not taken. The right to setoff benefits in federal condemnation has been provided for in 33 U.S.C. §§595 and 702a. Even when the right to setoff benefits is not specifically provided for, the government may still prove setoff benefits. Aaronson v. United States, 79 F.2d 139 (D.C.Cir. 1935); 6816.5 Acres of Land, More or Less, in Rio Arriba County, State of New Mexico v. United States, 411 F.2d 834 (10th Cir. 1969); United States v. Crance, 341 F.2d 161 (8th Cir. 1965). The government can set off only special benefits or those that are direct and peculiar to the particular property, and it may not set off incidental benefits or those enjoyed to a greater or lesser extent by the lands in the area of the improvement. United States v. 2,477.79 Acres of Land, More or Less, Situate in Bell County, Texas, 259 F.2d 23 (5th Cir. 1958). IV. POSSESSION AND TITLE A. [11.29] Inverse Condemnation The Declaration of Taking Act, ch. 307, 46 Stat. 1421 (1931), permits the federal government to take possession of condemned property in advance of a court determination of rights in compensation for the property. See §11.30 below. Additionally, the federal government may take property in advance of court proceedings through inverse condemnation. Typically, an inverse condemnation situation arises from the actions of a public entity that constitute a taking of property. The landowner initiates proceedings to assess the value of the interests taken. See §11.51 below. If no declaration of taking is filed, title does not vest in the government until the owner receives compensation. United States v. Dow, 357 U.S. 17, 2 L.Ed.2d 1109, 78 S.Ct. 1039 (1958). Actual payment to the condemnee is required; mere deposit into court is not sufficient to vest title in the United States when no declaration has been filed. Inverse condemnation cases also arise due to the imposition of federal regulations restricting the use of property, which are sometimes tantamount to a taking of the owner’s real property rights without just compensation. But as such regulatory takings are not exercises of federal condemnation power in the traditional sense, a discussion of that specialized area of law is beyond the scope of this chapter.



B. [11.30] Declaration of Taking Act 40 U.S.C. §§3111 – 3118 provide that, upon filing a declaration of taking and depositing the amount of estimated compensation in court, absolute fee simple title to the property or such estate or interest as is specified in the declaration and the right to possession of the specified property vest in the government. United States v. 0.13 Acre, More or Less, Situate in Kanawha County, State of West Virginia, 318 F.Supp.2d 351 (S.D.W.Va. 2004). The declaration of taking should contain (1) a statement of authority for the taking, (2) a description of the property, (3) a statement of the public use for which the property is taken, (4) a statement of the estate or interest taken, (5) a plan showing the lands taken, and (6) a statement of the estimated just compensation. The administrative determination of the amount of the deposit is not subject to judicial review in the absence of arbitrary or wanton abuse of discretion. United States v. Cobb, 328 F.2d 115 (9th Cir. 1964). The amount of the deposit is inadmissible at trial and establishes neither a floor nor a ceiling for the ultimate award. United States v. 9.85 Acres of Land, More or Less, in City of Hampton, Virginia, 183 F.Supp. 402 (E.D.Va. 1959), aff’d sub nom. Tidewater Development & Sales Corp. v. United States, 279 F.2d 890 (4th Cir. 1960). Upon application of the parties, the court may disburse the deposit in whole or in part. Since the declaration of taking stops the running of interest on the amount deposited in court, it is generally advisable for the landowner to promptly move for a disbursement of the deposit. There is no right to disbursement of the deposit, however. At the time of the taking, a “ ‘snapshot’ of the parties’ respective interests” in the property is taken, including the value of these interests. Kanawha County, supra, 318 F.Supp.2d at 357. The interests of the fee simple owner, as well as various lienholders, then transfer from the property itself to the funds deposited with the registry of the court, as those interests existed as of the date of taking. Kanawha County specifically addressed a circuit split with respect to the nature of redemption rights under state law in regard to certain tax liens. Following what appears to be the more accepted and “better approach” set forth in Weber v. Wells, 154 F.2d 1004 (9th Cir. 1946), while distinguishing and rejecting an alternative approach adopted in United States v. Certain Lands in Town of Hempstead, Nassau County, N.Y., 129 F.2d 918 (2d Cir. 1942), the court held that any right of redemption under state law, functionally or otherwise, would play no role after a taking under the statute, including valuing the compensable interest of the tax lienholder. Kanawha County, supra, 318 F.Supp.2d at 356 – 357. The court determined that the tax lienholder’s claim was the value of the tax lien at the time of the taking plus the accrued interest on the sum since deposit with the court. 318 F.Supp.2d at 357 – 358. The distribution of the deposit is merely tentative, and the amount awarded may be increased or decreased by final judgment. United States v. Catlin, 142 F.2d 781 (7th Cir. 1944), aff’d, 65 S.Ct. 631 (1945). The government must move for judgment on the declaration of taking to obtain possession, and the court has limited discretion to determine the time within which the parties in possession shall be required to surrender possession. United States v. Miller, 317 U.S. 369, 87 L.Ed. 336, 63



S.Ct. 276 (1943). The court should consider the needs of the owners as well as the rights of the government when determining the terms on which the parties in possession will be required to surrender possession. The court has the power to make such orders with respect to encumbrances, liens, rents, taxes, assessments, insurance, and other charges as may be just and equitable. Absent special proof, the rate of interest applicable in such cases is the statutory rate set forth in 40 U.S.C. §3116. Sears v. United States, 124 Fed.Cl. 730, 734 & n.3 (2016), citing Textainer Equipment Management Ltd. v. United States, 99 Fed.Cl. 211 (2011). An exception to the rule that deposit in court suspends accrual of interest occurs when the government opposes withdrawal of the deposit and the court declines to permit withdrawal; interest may be allowed on the portion withheld. United States v. 355.70 Acres of Land, More or Less, Situate in Townships of Rockaway & Jefferson, County of Morris, State of New Jersey, 327 F.2d 630 (3d Cir. 1964); Bishop v. United States, 288 F.2d 525 (5th Cir. 1961); United States v. Two Tracts of Land in Town of Brookhaven, County of Suffolk, State of New York, 412 F.2d 347 (2d Cir.), cert. denied, 90 S.Ct. 222 (1969). Sections 11.65 – 11.68 below contain sample forms relating to a declaration of taking. V. [11.31] PROCEDURE IN FEDERAL CONDEMNATION The Federal Rules of Civil Procedure govern the procedure for the condemnation of property except as otherwise provided in Fed.R.Civ.P. 71.1. Rule 71.1 prescribes a specialized procedure for condemnation proceedings that varies in several important respects from the general framework of the Federal Rules of Civil Procedure. Rule 71.1 does not supersede or in any way act in derogation of the Declaration of Taking Act. Advisory Committee Notes, 1951 Original Report, Note to Subdivision (a), Fed.R.Civ.P. 71.1. A thorough familiarity with Rule 71.1 is required for effective handling of a federal condemnation matter. Additionally, under Fed.R.Civ.P. 83, the district courts may adopt rules of practice and procedure in condemnation suits not inconsistent with Fed.R.Civ.P. 71.1 or the other federal rules. A. [11.32] Jurisdiction and Venue The federal district courts have original jurisdiction of all proceedings to condemn real estate for the use of the United States or its departments or agencies. 28 U.S.C. §1358. Section 1358 jurisdiction is not exclusive; jurisdiction may rest on other grants of jurisdiction as well. The district courts have pendent jurisdiction over matters related to the condemnation. The proper venue in all proceedings to condemn real estate is the “district where the land is located or, if located in different districts in the same State, in any of such districts.” 28 U.S.C. §1403. B. [11.33] Joinder of Properties The United States may join in the same action one or more separate pieces of property whether in the same or different ownership and whether sought for the same or different use. The practice is to try all issues as to various tracts in one condemnation proceeding. The owner who claims the right to a separate trial has a heavy burden of establishing cause for severance. Phelps Dodge Corp. v. Atchison, Topeka & Santa Fe Ry., 400 F.2d 20 (10th Cir. 1968). Prejudice arising



from different uses or zoning may be grounds for severance of different parcels. At the commencement of the action, the United States need join as defendants only the persons then known to have or claiming to have an interest in the property. Before any hearing involving the compensation to be paid for the property, the United States must add as defendants all persons having or claiming an interest in the property who can be ascertained by a reasonably diligent search of the records. “All others [having an interest in the property] may be made defendants under the designation ‘Unknown Owners.’ ” Fed.R.Civ.P. 71.1(c)(3). C. [11.34] Complaint The complaint in a condemnation case should contain 1. the nature and authority of the action; 2. a statement of the use for which the property is taken; 3. the interest to be acquired; 4. a recital of the statutory authority; 5. a legal description of the property; 6. a list of the persons having claims to each tract; and 7. a designation of the owners as to whether they are known or unknown defendants. See

Fed.R.Civ.P. 71.1(c)(2). The complaint must be filed with the court, along with at least one additional copy. Fed.R.Civ.P. 71.1(c)(5). The caption should follow Fed.R.Civ.P. 10(a), except that the plaintiff names as defendants the property, designated generally by kind, quantity, and location, and at least one of the owners of some part of or interest in the property. Fed.R.Civ.P. 71.1(c)(1). Section 11.69 below contains a sample form of a typical complaint in condemnation. D. [11.35] Process A notice, rather than a summons and complaint, constitutes process. Fed.R.Civ.P. 71.1(d)(4). The notice should state (1) the court, (2) the title of the action, (3) the name of the defendant to whom it is directed, (4) a statement to the effect that the action is to condemn property, (5) a description of the property sufficient for its identification, (6) the interest taken, (7) the authority for the taking, (8) the uses for which the property is to be taken, and (9) a statement to the effect that the defendant may serve on the plaintiff’s attorney an answer within 21 days after being served with notice and that the failure to so serve an answer constitutes a consent to the taking and to the authority of the court to proceed to hear the action and to fix the compensation. Fed.R.Civ.P. 71.1(d)(2). Fed.R.Civ.P. 71.1(d)(3)(A) provides that personal service of notice shall be made, in accordance with Fed.R.Civ.P. 4, on a defendant whose residence is known and who resides in the United States. Copies of the complaint need not be attached to the notice. Service by publication may be made on any defendant who cannot be served personally after diligent



inquiry. Service by publication must be made in a newspaper published in the county where the property is located. If there is no such paper, then publication must be made once a week for not less than three successive weeks in a newspaper having a general circulation where the property is located. Fed.R.Civ.P. 71.1(d)(3)(B). Section 11.70 below contains a sample form of a notice of condemnation. E. [11.36] Appearance or Answer Upon receiving notice of the filing of the complaint, a defendant may file either an answer or a notice of appearance, or he or she may not answer at all. An answer challenges the government’s right to take the property. The answer must 1. identify the property in which the defendant claims to have an interest; 2. state the nature and extent of the interest claimed; and 3. set forth all of the defendant’s objections and defenses to the taking (all defenses and

objections not presented are deemed waived). Fed.R.Civ.P. 71.1(e)(2). Answer should be made within 21 days. Id. The assertion of objections or defenses by motion or pleading other than the answer is forbidden. Section 11.71 below contains a sample form of an answer to a complaint. An appearance entitles the condemnee to receive notice of all proceedings affecting the property in which he or she claims to be interested and to present evidence of value at trial. Fed.R.Civ.P. 71.1(e)(1). Section 11.72 below contains a sample form of an appearance. F. [11.37] Objections and Defenses An attempt to reach an agreement with the property owner is not a condition precedent to a condemnation proceeding. United States v. Certain Interests in Property in County of Cascade, State of Montana, 163 F.Supp. 518 (D.Mont. 1958). In addition, failure to comply with the provisions of the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 (see §11.8 above) is not a defense to the taking. Paramount Farms, Inc. v. Morton, 527 F.2d 1301 (7th Cir. 1975). Finally, acquisition by condemnation may not be defeated by the failure to file an environmental impact statement in accordance with the National Environmental Policy Act of 1969, Pub.L. No. 91-190, 83 Stat. 852. Clinton Community Hospital Corp. v. Southern Maryland Medical Center, 374 F.Supp. 450 (D.Md. 1974), aff’d, 510 F.2d 1037 (4th Cir.), cert. denied, 95 S.Ct. 2666 (1975). G. [11.38] Amendment of Pleadings, Substitution of Parties, and Dismissal The plaintiff may amend the complaint without leave of the court at any time before trial on the issue of compensation, as provided by Fed.R.Civ.P. 71.1(f). A substitution of parties may be ordered upon motion and notice of hearing. Fed.R.Civ.P. 71.1(g). A dismissal may be taken in any of three ways:



1. Dismissal may be had if no hearing has begun to fix compensation and title or possession has not been acquired merely by filing a notice of dismissal without an order of the court. Fed.R.Civ.P. 71.1(i)(1). 2. Dismissal by stipulation may be had before judgment without court approval as to any property, and if the court approves a stipulation for dismissal after judgment, the case may be dismissed. Fed.R.Civ.P. 71.1(i)(1)(B). 3. Prior to compensation for a piece of property taken, the court may, after a motion and a hearing, dismiss the action as to any part of which the plaintiff has taken possession. When the plaintiff has taken a lesser title or interest, the court must award just compensation for the possession, title, or lesser interest taken. The court may also drop any unnecessary or improperly joined defendant after a motion and a hearing. Fed.R.Civ.P. 71.1(i)(1)(C), 71.1(i)(2). The Attorney General can stipulate to revest any part of the possession, title, or lesser interest vested in the United States. 40 U.S.C. §3117. See §11.62 below. H. [11.39] Burden of Proof The property owner has the burden of proving, by a preponderance of the evidence, the value of the land asserted by him or her. United States ex rel. Tennessee Valley Authority v. Powelson, 319 U.S. 266, 87 L.Ed. 1390, 63 S.Ct. 1047 (1943). The party who has the burden of proof as to the issues controverted by the pleadings has the right to open and close. However, if the landowner contests the legality of the taking, the burden of this issue is on the government, and it has the right to open and close. If the amount of compensation is at issue, then the landowner has the right to open and close. I. [11.40] Discovery The means of discovery, the scope of discovery, and the consequences of failing to respond to discovery are encompassed in Fed.R.Civ.P. 26 – 37. Fed.R.Civ.P. 26 divides experts into two categories: (1) those who are expected to be called as witnesses at trial (Fed.R.Civ.P. 26(b)(4)(A)); and (2) those who, while retained in anticipation of litigation or for trial preparation, are not expected to testify (Fed.R.Civ.P. 26(b)(4)(B)). The opinions of experts who are not expected to testify and facts known by those experts can be discovered only upon a showing of “exceptional circumstances.” Hoover v. United States Department of Interior, 611 F.2d 1132, 1142 (5th Cir. 1980), quoting Breedlove v. Beech Aircraft Corp., 57 F.R.D. 202, 205 (N.D.Miss. 1972). This requirement has been held not to apply to precondemnation appraisals required under the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970. In United States v. 9.345 Acres of Land, Civil Action No. 11-803-JJB-SCR, 2012 WL 3961217 (M.D.La. Sept. 10, 2012), the court held that such appraisals are prepared primarily in compliance with a public requirement and not in anticipation of litigation, and thus the party seeking the appraisal was not required to show exceptional circumstances, under Fed.R.Civ.P. 26(b)(4)(D), to obtain the document(s) relating to such an appraisal during discovery — even if the condemning authority did not designate the appraiser as an expert witness and had no intention of calling the appraiser as a witness at trial.



With regard to expert witnesses who are expected to testify at trial, Fed.R.Civ.P. 26(a)(2), provides, in part:

A) In General. In addition to the disclosures required by Rule 26(a)(1), a party must disclose to the other parties the identity of any witness it may use at trial to present evidence under Federal Rule of Evidence 702, 703, or 705.

(B) Witnesses Who Must Provide a Written Report. Unless otherwise stipulated or ordered by the court, this disclosure must be accompanied by a written report — prepared and signed by the witness — if the witness is one retained or specially employed to provide expert testimony in the case or one whose duties as the party’s employee regularly involve giving expert testimony. The report must contain:

(i) a complete statement of all opinions the witness will express and the basis and reasons for them; (ii) the facts or data considered by the witness in forming them; (iii) any exhibits that will be used to summarize or support them; (iv) the witness’s qualifications, including a list of all publications authored in the previous 10 years; (v) a list of all other cases in which, during the previous 4 years, the witness testified as an expert at trial or by deposition; and (vi) a statement of the compensation to be paid for the study and testimony in the case.

Fed.R.Civ.P. 26(a)(2)(B)(ii) requires that the report contain the “facts or data considered” in forming opinions. Advisory Committee Notes, 2010 Amendments, Note to Subdivision (a)(2)(B), Fed.R.Civ.P. 26. The requirement is intended to provide work-product protection to draft reports, disclosures, or attorney-expert communications, in stark contrast to the prior formulation of Rule 26, which made all draft reports and attorney-expert communications discoverable. Id. Furthermore, these formerly discoverable communications also receive additional protection under Fed.R.Civ.P. 26(b)(4)(C), which confers work-product protection (as set forth in Rule 26(b)(3)) on most attorney and retained expert communications. The following communications between an attorney and testifying experts, however, are discoverable: (1) those relating to expert compensation; (2) those that identify facts or data provided by the attorney and considered by the expert; and (3) assumptions provided to the expert by counsel. Fed.R.Civ.P. 26(b)(4)(C). Fed.R.Civ.P. 26 also requires disclosure of the subject matter of testifying, non-retained expert witnesses not subject to the reporting requirement of Rule 26(a)(2)(B), as well as a summary of the expert’s opinions and the facts supporting them. Fed.R.Civ.P. 26(a)(2)(C). When considering the testimony of experts, such as real estate appraisers or environmental engineers, attorneys must be mindful of the Supreme Court’s ruling in Daubert v. Merrell Dow Pharmaceuticals, Inc., 509 U.S. 579, 125 L.Ed.2d 469, 113 S.Ct. 2786 (1993), concerning the



scientific reliability of their opinions. See Joseph G. Feehan, Life after Daubert and Kumho Tire: An Update on Admissibility of Expert Testimony, 88 Ill.B.J. 134 (2000); Joseph F. Madonia and Ian J. McPheron, Unanswered Questions after Kumho Tire, 88 Ill.B.J. 139 (2000). J. [11.41] Methods and Conduct of Trial Fed.R.Civ.P. 71.1(h) provides four methods by which the issue of just compensation in condemnation actions may be determined — by tribunal, jury, commission, or district court (by default). District courts try all issues, including compensation, except in certain circumstances. In some actions, compensation must be determined by a tribunal specially constituted by federal statute. If there is no statutorily established tribunal method and a party demands a jury, the court may either grant a jury trial or appoint a commission to determine compensation. The landowner has the burden of proving the value of condemned property. United States ex rel. Tennessee Valley Authority v. Powelson, 319 U.S. 266, 87 L.Ed. 1390, 63 S.Ct. 1047, 1052 (1943). 1. [11.42] Trial by Tribunal of Issue of Just Compensation Trial by tribunal of the issue of just compensation is limited and occurs only pursuant to certain federal statutes. The drafters of the current Fed.R.Civ.P. 71.1(h)(1)(A) included the provision to avoid conflict between the rule and those statutes that require trial of the issue of just compensation by tribunal. See Advisory Committee Notes, 1951 Addition, Original Report, Fed.R.Civ.P. 71.1 (acquisition of lands in District of Columbia for use of United States and condemnation actions by Tennessee Valley Authority). 2. [11.43] Trial by Jury of Issue of Just Compensation Fed.R.Civ.P. 71.1(h)(1)(B) does not establish an unequivocal right to a jury trial but provides that a party may demand a jury trial on the sole issue of just compensation. The Supreme Court has interpreted the rule narrowly, finding that

except for the single issue of just compensation, the trial judge is to decide all issues, legal and factual, that may be presented. . . . [T]he Rule’s basic structure makes clear that a jury in federal condemnation proceedings is to be confined to the performance of a single narrow but important function — the determination of a compensation award within ground rules established by the trial judge. United States v. Reynolds, 397 U.S. 14, 25 L.Ed.2d 12, 90 S.Ct. 803, 807 (1970).

Although a jury trial is the usual method of determining just compensation in a condemnation action when a party so demands, the Constitution does not guarantee a jury trial in condemnation actions. Dohany v. Rogers, 281 U.S. 362, 74 L.Ed. 904, 50 S.Ct. 299 (1930); Reynolds, supra, 90 S.Ct. at 806. The district court retains discretion to deny a jury demand and refer the matter to a commission. However, one circuit court has held that the

litigants should have the right of trial by jury . . . except . . . in extraordinary and exceptional cases and that the commissioner provision of the Rule should be employed only in exceptional cases where because of peculiar circumstances trial by jury was inadvisable. United States v. Theimer, 199 F.2d 501, 503 (10th Cir. 1952).



Failure to demand a jury trial within the time allowed for the answer (21 days after service of notice on the defendant) will effectively constitute a waiver of that right and consent to the court fixing compensation for the taking. Fed.R.Civ.P. 71.1(d)(2)(A)(v), 71.1(d)(2)(A)(vi). See also Fed.R.Civ.P. 6. A party may unilaterally withdraw demand for a jury trial without the consent of the adverse party. (Fed.R.Civ.P. 38(d), which requires all parties’ consent before withdrawal of a demand for jury trial, applies only to jury trials of right.) Accordingly, if a party in a condemnation action prefers a jury trial to determine the issue of just compensation, the party should not rely on the demand of the adverse party. United States v. Keller, 142 F.3d 718, 719 – 723 (4th Cir. 1998). NOTE: The court may require the jury to return a special verdict or otherwise proceed in accordance with Fed.R.Civ.P. 49(a). Finally, Rule 71.1 does not specifically set forth the method for the jury trial proceeding in a condemnation action. Therefore, the general provisions of the Federal Rules of Civil Procedure govern the conduct of the trial. 3. [11.44] Trial by Commission of Issue of Just Compensation Fed.R.Civ.P. 71.1(h)(2) provides for the appointment of commissioners to determine the issue of just compensation. If a party demands a jury trial, the court may instead deem it appropriate, due to the character, location, or quantity of the property to be condemned, or for other just reasons, to appoint a three-person commission to determine compensation. Parties are not entitled to the appointment of a commission as a matter of right. United States v. Vater, 259 F.2d 667 (2d Cir. 1958). The court’s discretion to appoint a commission is limited to the exceptional case (United States v. Bobinski, 244 F.2d 299 (2d Cir. 1957)), and congestion of the court calendar is not sufficient to justify such appointment (United States v. Buhler, 254 F.2d 876 (5th Cir. 1958); United States v. Theimer, 199 F.2d 501 (10th Cir. 1952); Sykes v. United States, 392 F.2d 735 (8th Cir. 1968)). Nonetheless, courts do not hesitate to appoint commissions when they determine it is justified under the circumstances of the case. See United States v. 5.00 Acres of Land, More or Less, in County of Collier, State of Florida, 673 F.2d 1244, 1247 (11th Cir. 1982) (commission appropriate because large area was held by many small landowners and property was too distant for jury to view); United States v. 320.0 Acres of Land, More or Less in County of Monroe, State of Florida, 605 F.2d 762, 828 (5th Cir. 1979) (commission not only appropriate but required in interest of justice based on number of parcels involved, remoteness of parcels from courthouse, and complexity of issues). But it is not an abuse of discretion for a judge to decline to appoint a commission when one is requested, even if large amounts of money are involved. Washington Metropolitan Area Transit Authority v. Two Parcels of Land in Fairfax County, Virginia, 569 F.2d 816 (4th Cir. 1978). If both parties demand a jury trial, the court must make a finding of exceptional circumstances to justify the appointment of a commission instead. United States v. 2,187.43 Acres of Land, More or Less, Situate in St. Francis County, Arkansas, 461 F.2d 938 (8th Cir. 1972). Courts ultimately agree that in determining whether to appoint a commission, the focus of the analysis should be the overall scope of the project. United States v. Waymire, 202 F.2d 550, 552 (10th Cir. 1953). If a court decides to appoint a commission, the court should set forth specific factual findings in support of its decision (Buhler, supra, 254 F.2d at 880 – 881), although one



court has held that the failure to do so is not reversible error (United States v. 2,477.79 Acres of Land, More or Less, Situate in Bell County, Texas, 259 F.2d 23, 27 (5th Cir. 1958)). A court’s failure to make factual findings, especially in a case in which the court predicates its referral to a commission on the “interest of justice,” may not provide an appellate court with sufficient grounds to uphold the referral. Theimer, supra, 199 F.2d at 503. In addition to the three commissioners called for by rule, the court may also appoint up to two alternate commissioners, who will hear the case and replace commissioners the court determines are unable to or disqualified from performing the required duties. Once a commission renders its final decision, the court must discharge any unneeded alternates. Fed.R.Civ.P. 71.1(h)(2)(A), 71.1(h)(2)(B). Before making its appointments, the court must advise the parties of the identity and qualifications of each prospective commissioner and alternate and may permit the parties to examine them. The parties may not suggest appointees but for good cause may object to a prospective commissioner or alternate. Fed.R.Civ.P. 71.1(h)(2)(C). If a party objects to the appointment of a commissioner, it must make its objection to the court, not to the commissioners. If a party fails to object to the court, it waives its right to do so. United States v. Wallace, 201 F.2d 65, 67 (10th Cir. 1952). The rule is silent regarding the requisite qualifications for commissioners, but “it is understood that only persons possessing a background and ability to appraise real estate valuation testimony and to award fair and just compensation on the basis thereof [should] be appointed.” See Advisory Committee Notes, 1985 Amendment, Fed.R.Civ.P. 71.1. But see United States v. Merz, 376 U.S. 192, 11 L.Ed.2d 629, 84 S.Ct. 639 (1964) (rejecting concept that commission should sit as appraisal board, instead stating that commission should function as deliberative body and should conduct its proceedings like judicial trial). The commission is obliged to meet as called for in the appointing order and “to proceed with all reasonable diligence.” Fed.R.Civ.P. 53(b)(2). See also Fed.R.Civ.P. 53(c). Failure to proceed diligently has resulted in the commission’s dismissal. Vater, supra. The rules of evidence apply to proceedings; it is advisable, therefore, for at least one commissioner to be a lawyer. The commission should be instructed in the rules of evidence, the method of receiving evidence, and the manner of conducting the hearing. The function of the commission should be limited to rulings on evidence and the determination of just compensation. The commission may not determine subsidiary legal questions, such as the navigability of a stream or the validity of the certificate of taking. United States v. 91.69 Acres of Land, More or Less, Situate in Oconee County, State of South Carolina, 334 F.2d 229 (4th Cir. 1964). Because there is no designated procedure for most of the steps in the use of commissions, it is important for parties to guard against loss of objections. The better practice is to file written objections, especially to matters such as the use of a commission and to the persons appointed. As to the evidence at the trial, objections should be taken and preserved during the trial as in other cases. Fed.R.Civ.P. 71.1(h)(2)(D) incorporates some, but not all, of the provisions of Fed.R.Civ.P. 53 relating to the appointment of a master. The commission has the power of a master under Rule 53(c). Its actions and report are determined by a majority. Rules 53(d) – 53(f) apply to the



commission’s action and report. Fed.R.Civ.P. 71.1(h)(2)(D). This rule has led some courts to impute to commissioners the standard of conduct required of masters. However, courts dispute what those standards are and whether masters (and, by implication, commissioners in condemnation actions) should be held to the same ethical standards as judges. Compare United States v. Werner, 916 F.2d 175, 177 – 178 (4th Cir. 1990) (commissioners held to same ethical standards as judges), with Morgan v. Kerrigan, 530 F.2d 401, 426 (1st Cir. 1976) (special masters held to lesser standards of impartiality). The Seventh Circuit has explained the distinction between commissioners and masters, stating: “Unlike masters, who act as surrogates for a district judge, commissioners hear evidence and make proposals to the court on disputed questions of fact,” which the commissioners submit to the judge, who makes an independent decision. Guardian Pipeline, L.L.C. v. 950.80 Acres of Land, 525 F.3d 554, 556 (7th Cir. 2008). Fed.R.Civ.P. 71.1(h)(2)(D) requires the commission to submit a report of its findings to the court. Those findings are to be accepted by the court unless clearly erroneous. Conclusory findings are not sufficient; however, findings need not be as detailed as those made by a judge. Merz, supra. Thus, an award will not be set aside for minor, technical errors in the admission or exclusion of evidence but will be permitted to stand unless it appears that the commission adopted an erroneous principle in fixing damages or unless the error so affected the result as to bring about an injustice to the complaining party. See Fed.R.Civ.P. 53(f). Under Fed.R.Civ.P. 53(f)(2), upon submission of the commission report to the court, a party may file with the referring court a motion to adopt or modify the commission report and/or recommendations or object to the report within 21 days after a copy is served, unless the referring court specifies a different time. The objections must be specific. Merz, supra. Objections not so taken are waived. 4. [11.45] Trial by District Court of All Other Issues If a jury trial is not demanded by any party, and Congress has not authorized a tribunal, then the court must, by default, conduct a bench trial. Fed.R.Civ.P. 71.1(h). The court does not have authority to refer the matter to a commission in the absence of a party’s demand for a jury trial. United States v. Vater, 259 F.2d 667 (2d Cir. 1958). Rule 71.1(h)(1) provides that trial of all issues, other than just compensation, shall be by the court. See also United States v. Miller, 317 U.S. 369, 87 L.Ed. 336, 63 S.Ct. 276 (1943). Importantly, however, it must be read in context with Rule 71.1(a), which states that all other Federal Rules of Civil Procedure apply except as otherwise provided in Rule 71.1. Thus, under Fed.R.Civ.P. 53, the court may refer particular issues to a special master or to other tribunals. Finally, in Best v. Humboldt Placer Mining Co., 371 U.S. 334, 9 L.Ed.2d 350, 83 S.Ct. 379 (1963), the U.S. Supreme Court held that the condemnation court might properly defer to the special competence of the U.S. Department of the Interior in determining the validity of asserting certain mining claims.



K. [11.46] Court Costs The general rule that costs go to the prevailing party is inapplicable in condemnation proceedings. The constitutional mandate of just compensation does not require reimbursement of an owner for attorneys’ fees and other litigation expenses in defending a condemnation proceeding. Dohany v. Rogers, 281 U.S. 362, 74 L.Ed. 904, 50 S.Ct. 299 (1930). 1. [11.47] Equal Access to Justice Act The Equal Access to Justice Act (EAJA), Pub.L. No. 96-481, Title II, 94 Stat. 2325 (1980), allows the prevailing party to recover costs, attorneys’ fees, and expenses against the United States. 28 U.S.C. §2412. Several circuit courts have held that the EAJA is applicable to condemnation cases. United States v. 5,063.17 Acres of Land, More or Less, Situate in Las Animas County, Colorado, 607 F.Supp. 311 (D.Colo. 1985), rev’d sub nom. United States v. Charles Gyurman Land & Cattle Co., 836 F.2d 480 (10th Cir. 1987); United States v. 640.00 Acres of Land, More or Less, in County of Dade, State of Florida, 756 F.2d 842 (11th Cir. 1985); United States v. 341.45 Acres of Land, More or Less, Located in County of St. Louis, State of Minnesota, 751 F.2d 924 (8th Cir. 1984); United States v. 329.73 Acres of Land, Situated in Grenada & Yalobusha Counties, State of Mississippi, 704 F.2d 800 (5th Cir. 1983) (en banc); United States v. 101.80 Acres of Land, More or Less, in Idaho County, Idaho, 716 F.2d 714 (9th Cir. 1983). To determine just compensation in EAJA cases, counsel must become acquainted with the history of and amendments to the EAJA and with annotated cases. First, counsel must represent a prevailing party for purposes of the EAJA. These parties include property owners whose land or property interests have been taken in condemnation and who either did not dispute the authority of the government to take the property or, if the authority was disputed, lost on the issue but won, through litigation, more than the government proposed or offered as just compensation. 341.45 Acres of Land, supra; 329.73 Acres of Land, supra. Second, counsel should be aware that the test to determine whether the government’s position is substantially justified for the EAJA requires the district court to focus on the relationship between the government’s offer, appraisals, and valuations established by an expert during trial, rather than the relationship between the offer or deposit and the property owner’s counteroffer, if any, or the jury award. United States v. 312.50 Acres of Land, More or Less, Situated in Prince William County, Commonwealth of Virginia, 851 F.2d 117 (4th Cir. 1988); Charles Gyurman Land & Cattle, supra. See also the cases cited in Notes of Decisions, Substantial Justification in Particular Actions, Condemnation actions, 28 U.S.C.A. §2412. 2. [11.48] Costs Pursuant to 42 U.S.C. §4654(a) 42 U.S.C. §4654(a) grants the recovery of costs, including attorneys’ fees, to the landowner when the government abandons the proceeding or the government is held not to have the right to take.



3. [11.49] Federal Rule of Civil Procedure 68 Costs Fed.R.Civ.P. 68 provides for the recovery of costs in certain cases in which the claimant rejects a settlement offer because he or she cannot recover costs against the United States when they are not authorized by statute. United States v. Certain Parcels of Land in City of Baltimore, Parcel No. 12, 43 F.Supp. 687 (D.Md. 1942). L. [11.50] Abandonment When no declaration of taking has been filed and possession has not been taken prior to the institution of condemnation proceedings, a condemnation judgment, in effect, gives the condemnor an option of taking at the amount awarded or of abandonment. Barnidge v. United States, 101 F.2d 295 (8th Cir. 1939). VI. REMEDIES OF INTEREST HOLDERS NEITHER PAID NOR PROCEEDED

AGAINST A. [11.51] Tucker Act The government is not required to exercise its power of eminent domain by formal proceedings. Shoshone Tribe of Indians of Wind River Reservation in Wyoming v. United States, 299 U.S. 476, 81 L.Ed. 360, 57 S.Ct. 244 (1937). Rather, the government may take property and leave the owner to his or her remedies under the Tucker Act, ch. 359, 24 Stat. 505 (1887). Such situations generally fall into the category of inverse condemnations. See §11.29 above. The Tucker Act creates a waiver of immunity to suit within its provisions. 28 U.S.C. §1346. The Tucker Act does not waive sovereign immunity as to torts, but when the property has been taken by the United States, the owner may sue the government on the basis of an implied contract (United States v. Buffalo Pitts Co., 234 U.S. 228, 58 L.Ed. 1290, 34 S.Ct. 840 (1914)) or for a taking in violation of the Constitution (United States v. Dickinson, 331 U.S. 745, 91 L.Ed. 1789, 67 S.Ct. 1382 (1947)). There is, however, no implied contract to pay for property merely because it is damaged when the damage is not so severe as to amount to a taking. Peabody v. United States, 231 U.S. 530, 58 L.Ed. 351, 34 S.Ct. 159 (1913). B. [11.52] Injunction When, under established principles, an action for equitable relief is proper, the condemnation may be challenged by an injunction. Dohany v. Rogers, 281 U.S. 362, 74 L.Ed. 904, 50 S.Ct. 299 (1930). C. [11.53] Ejectment Ejectment is a proper remedy when federal officials have unlawfully taken private property. Wood v. Phillips, 50 F.2d 714 (4th Cir. 1931); Land v. Dollar, 330 U.S. 731, 91 L.Ed. 1209, 67 S.Ct. 1009 (1947).



D. [11.54] Trespass An action of trespass may be maintained against federal officials who have wrongfully entered on private property. Mine Safety Appliances Co. v. Forrestal, 326 U.S. 371, 90 L.Ed. 140, 66 S.Ct. 219 (1945). VII. [11.55] RELOCATION PAYMENTS: UNIFORM RELOCATION ASSISTANCE AND REAL PROPERTY ACQUISITION POLICIES ACT of 1970 The Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 provides for payments and services to persons displaced by federal projects or federally funded projects. See §11.8 above. The URA does not change the traditional rule that the costs of moving and relocation are not compensable items of damage in condemnation actions. Rather, the URA establishes assistance programs that are administratively conducted. The programs are completely independent of the condemnation proceeding itself. A. [11.56] Moving and Related Expenses Section 202 of the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 requires that the head of the displacing agency provide payment to the displaced landowner for

(1) actual reasonable expenses in moving himself, his family, business, farm operation, or other personal property; (2) actual direct losses of tangible personal property . . .; (3) actual reasonable expenses in searching for a replacement business or farm; and (4) actual reasonable expenses necessary to reestablish a displaced farm, nonprofit organization, or small business at its new site, but not to exceed $25,000, as adjusted by regulation, in accordance with section 4633(d) of this title. 42 U.S.C. §4622(a).

If a displaced person is required to move from a dwelling and is eligible for payments under §4622(a), he or she may elect to receive an expense and dislocation allowance that will be determined according to a schedule established by the head of the agency in lieu of the payments authorized by §4622(a). 42 U.S.C. §4622(b). In certain instances, a person displaced from his or her place of business or farm may, regardless of whether the person discontinues or reestablishes operations, elect to receive a fixed relocation payment not to exceed $40,000 (as adjusted by regulation) in lieu of the payments authorized by §4622(a). 42 U.S.C. §4622(c). B. [11.57] Replacement Housing for Homeowners Section 203 of the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 allows a homeowner to receive a maximum of $31,000 (as adjusted by regulation) for



replacement housing. 42 U.S.C. §4623(a)(1). The homeowner will be compensated for any increased interest costs that he or she is required to pay to finance replacement housing. The homeowner may also recover reasonable expenses incurred for evidence of title, recording fees, and other closing costs incidental to the purchase of the replacement dwelling but not including prepaid expenses. To qualify for any payment toward replacement housing, the homeowner must have owned and occupied the dwelling for not less than 180 days before the initiation of negotiations for the acquisition of the property. 42 U.S.C. §4623(a)(1)(B). The dwelling may be a single-family or multifamily building or a mobile home that cannot be moved without substantial damage or unreasonable cost. A dwelling is owned by a displaced person if he or she holds the fee title, a life estate, a 99-year lease, or a lease with not less than 50 years to run from the date of acquisition of the property by the government. 49 C.F.R. §24.2(a)(20)(i). C. [11.58] Replacement Housing for Tenants A tenant who has occupied the dwelling for not less than 90 days before the initiation of the negotiations for acquisition of the property may receive payments to a maximum of $7,200 (as adjusted by regulation) when necessary to enable him or her to rent a comparable dwelling. 42 U.S.C. §4624(a). To encourage home ownership, the displaced tenant may receive the amount necessary to enable him or her to make a down payment and to recover reasonable expenses for evidence of title, recording fees, and other closing costs on decent and safe housing. D. [11.59] Relocation Assistance Service Section 205 of the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 provides a relocation assistance advisory program. 42 U.S.C. §4625. Persons occupying property immediately adjacent to the real property acquired may avail themselves of the service offered by the program. The service offered by the assistance program should include a determination of the needs of the displaced person, information on alternative housing, and information on related state and federal assistance programs. E. [11.60] State Assistance or Involvement in Project When the state acquires real property at the request of a federal agency for a federal project, the federal agency must make payments and provide assistance as if it had itself acquired the real property. 42 U.S.C. §4628. Whenever real property is acquired by a state and furnished as a required contribution incident to a federal program, the state must provide fair and reasonable services and payments. 42 U.S.C. §4627. F. [11.61] Payments Not To Be Considered Income Section 216 of the Uniform Relocation Assistance and Real Property Acquisition Policies Act of 1970 provides that no payment or assistance received under the provisions described in §§11.56 – 11.60 above is to be considered income for purposes of the Internal Revenue Code, 26 U.S.C. §1, et seq. 42 U.S.C. §4636.



VIII. REVESTMENTS, EXCHANGES, AND DISPOSALS A. [11.62] Revestments Title to land or interests acquired by the filing of a declaration of taking may be returned to the former owner upon his or her consent pursuant to 40 U.S.C. §3117. Revestment cannot be accomplished unilaterally by the government. For example, if the government sought to return unrequired land acquired by an erroneous legal description, the government would be forced to retain the land (or dispose of it through normal procedures) if the former owner refused to stipulate to a revestment. A revestment can result only in the return of the identical land or interest previously acquired by a declaration of taking. B. [11.63] Exchanges A landowner may request that a revestment be accomplished by an exchange of government-owned property for the property acquired by the declaration of taking. On the military side, the authority for the Secretary of the Army to exchange property is contained in 10 U.S.C. §2663. C. [11.64] Disposals The basic authority for the disposal of government property is Article IV, §3, clause 2 of the United States Constitution, which reads, in part:

The Congress shall have Power to dispose of and make all needful Rules and Regulations respecting the Territory or other Property belonging to the United States.

In 1949, the Federal Property and Administrative Services Act of 1949 (FPASA), ch. 288, 63 Stat. 377, was enacted. This Act created the U.S. General Services Administration and gave this agency authority to dispose generally of all surplus federally owned property.



IX. APPENDIX — SAMPLE FORMS A. Forms Relating to Declaration of Taking 1. [11.65] Declaration of Taking

UNITED STATES DISTRICT COURT ____________ DISTRICT OF ILLINOIS

____________ DIVISION UNITED STATES OF AMERICA, ) ) Plaintiff, ) ) v. ) Civil No. ______ ) ____________, ) ) Defendants. )

DECLARATION OF TAKING I, [head of acquiring authority], hereby declare that: a. The lands described in Schedule [A] attached hereto are hereby taken for the use of the United States of America under authority of [Acts authorizing the acquisition]. b. The public use for which those lands are taken is [public use]. c. A description of the lands taken sufficient for identification thereof is set forth in Schedule [A] attached hereto. d. The estate hereby taken for said public use is [estate or interest to be acquired]. e. A plan showing the lands taken is attached hereto as Schedule [B]. f. A statement of the sums of money estimated by me to be just compensation for the lands taken is set forth in Schedule [A] attached hereto, and said sums are deposited in the registry of the Court to the use of the persons entitled to them. In Witness Whereof, I, [head of acquiring authority], acting under the authority of the aforesaid Acts of Congress, have signed the Declaration of Taking on [date]. ______________________________________ Head of Acquiring Authority



2. [11.66] Petition for Distribution of Deposit

[Caption]

PETITION FOR DISTRIBUTION OF DEPOSIT Now comes [petitioner], hereinafter referred to as “petitioner,” and makes this petition for advancement of the funds deposited in the registry of the Court as estimated just compensation for tracts [list tracts]. a. A complaint was filed on [date complaint was filed], seeking to condemn certain tracts of land, among which were the above-mentioned tracts. b. On [date declaration of taking was filed], a declaration of taking was filed on said tracts, and the sum of $[amount of deposit in registry] was deposited in the registry of the Court as estimated just compensation for the taking of those tracts. c. Your petitioner was the owner in fee simple of said tracts of land [or state estate or interest in property] consisting of [number of acres] acres, there are no liens or encumbrances of any kind against that property, and all taxes against the property are paid. d. Your petitioner is entitled to have advanced to [him] [her] the amount deposited in the registry of the Court. e. This petition is made without prejudice to the petitioner’s right to seek and contest for a higher value for the taking of said lands. f. If the final award is less than the amount advanced to [him] [her], the petitioner agrees to deposit back into the registry of the Court the difference between the sum advanced and the final award made and entered on said tracts. Wherefore, the petitioner prays the Court that this petition be granted. _____________________________________ Attorney for [client] [attorney information] 3. [11.67] Order for Distribution

[Caption]

ORDER FOR DISTRIBUTION Now, on [date of hearing], this cause comes on for hearing upon the application of the defendants, named below, for distribution of the amount on deposit in the registry of the



Court as estimated compensation for the taking of the above-captioned tracts. The Court, being fully advised in the premises, finds that the sum of $[amount of deposit in registry] is on deposit in the registry of this Court and that a distribution should be made at this time. THEREFORE, IT IS ORDERED BY THE COURT that the Clerk pay from the funds on deposit in the registry of this Court the sum of $[amount of distribution to defendants] as distribution to [defendants’ names]. ______________________________________ United States District Judge APPROVED: ___________________________________ Assistant United States Attorney Attorney for Plaintiff ___________________________________ Attorney for Defendants 4. [11.68] Petition of Owners for Payment of Deposit for Taxes, for Lien, and to

Owners

[Caption]

PETITION OF OWNERS FOR PAYMENT OF DEPOSIT FOR TAXES, FOR LIEN, AND TO OWNERS

To the Honorable [judge], the Judge of the United States District Court for the [district] District of Illinois: Defendants, [defendants’ name(s)], respectfully represent to this Court: a. That a Declaration of Taking on behalf of the United States was filed in this action on [date declaration of taking was filed], and that the United States has caused to be deposited in the registry of this Court as just compensation for the lands therein contained and for the use of the persons entitled thereto the sum of $[amount of deposit in registry]. b. That judgment on the Declaration of Taking was entered herein on [date judgment of declaration of taking was entered], and that this Court is duly authorized thereby to order the payment of the $[amount of deposit in registry] so deposited without prejudice to the rights of the defendants or such additional compensation as may be found to be due. c. That defendants, [defendants’ name(s)], were the owners in fee simple of the land at the time of the filing of said Declaration of Taking and that the only known liens thereon are



1. Lien of the [financial institution] under Deed of Trust, recorded in Book [book designation], page [page number], of the records of [county where lien recorded] County, Illinois, in the sum of $[amount of lien] computed as of [date lien amount computed].

2. Liens for taxes. d. That defendants, [defendants’ name(s)], desire to accept the sum on deposit, less amounts due the [financial institution] and for the payment of taxes, without prejudice to such additional compensation as may be found to be due them. Wherefore, defendants, [defendants’ name(s)], respectfully pray this Court without further or any notice to enter its order for payment and judgment in this action awarding said sum of $[amount of award] as partial payment without prejudice to such additional compensation as may be found to be due and directing that it be disbursed as follows: 1. For payment of taxes. 2. For satisfaction of the lien of [financial institution] in the amount due under the Deed

of Trust described above. 3. For disbursement of the balance to defendants, [defendants’ name(s)]. ______________________________________ Attorney for [defendants’ names] [attorney information] B. [11.69] Complaint in Condemnation

[Caption]

COMPLAINT IN CONDEMNATION

1. This is an action of a civil nature brought by the United States of America for the taking of property under the power of eminent domain and for the ascertainment and award of just compensation to the owners and parties in interest. 2. The authority for the taking is [citation for authority for taking]. 3. The use for which the property is to be taken is [state the use]. 4. The interest to be acquired in the property is [state the interest].



5. The property so to be taken is [description of the property sufficient for its identification]. 6. The persons known to the plaintiff to have or claim an interest in the property are [names of interested persons and the interests claimed]. 7. In addition to the persons named, there are or may be others who have or may claim some interest in the property to be taken whose names are unknown to the plaintiff and on diligent inquiry have not been ascertained. They are made parties to the action under the designation “Unknown Owners.” Wherefore, the plaintiff demands judgment that the property be condemned and that just compensation for the taking be ascertained and awarded and for such other relief as may be lawful and proper. United States Attorney By: ______________________________________ Assistant United States Attorney [address] C. [11.70] Notice of Condemnation

[Caption]

NOTICE OF CONDEMNATION To [names of the defendants to whom the notice is directed]: You are hereby notified that a complaint of condemnation has been filed in the office of the Clerk of the United States District Court for the [district of filing] District of Illinois, in the United States Courthouse in [municipality], for the taking of [interest to be acquired] for use as [state the use] in the following described property in which you have or claim an interest: [description of the property in which the defendants to whom the notice is directed have or claim an interest]. The authority for the taking is [citation for authority for taking]. You are further notified that if you desire to present any objection or defense to the taking of your property, you are required to serve your answer on the plaintiff’s attorney at the address herein designated within 20 days after [date 20-day time limit starts].



Your answer shall identify the property in which you claim to have an interest, state the nature and extent of the interest you claim, and state all of your objections and defenses to the taking of your property. All defenses and objections not so presented are waived. In case of your failure to so answer the complaint, judgment of condemnation of that part of the above-described property in which you have or claim an interest will be rendered. Without answering, you may serve on the plaintiff’s attorney a notice of appearance designating the property in which you claim to be interested. Thereafter you will receive notice of all proceedings affecting it. At the trial of the issue of just compensation, whether you have previously appeared or answered, you may present evidence as to the amount of the compensation to be paid for your property, and you may share in the distribution of the award. United States Attorney By: ______________________________________ Assistant United States Attorney [address] D. [11.71] Answer to Complaint

[Caption]

ANSWER TO COMPLAINT 1. Defendant, [defendant’s name], is the owner in [fee simple or other interest] of the following property: [property description]. [2. Defendant, (defendant’s name), objects to the taking of this property on the following grounds: (grounds of objection).]

[or] [2. Defendant, (defendant’s name), for its answer to the plaintiff’s complaint, admits, denies, and alleges as follows: (deny and admit appropriate allegations of complaint).] For a further separate answer and defense, defendant alleges [state grounds of defense].

[prayer]

______________________________________ Attorney for ___________________________ [attorney information]



E. [11.72] Appearance

UNITED STATES DISTRICT COURT ____________ DISTRICT OF ILLINOIS

____________ DIVISION In the Matter of ____________ Case Number: ____________ Appearances are hereby filed by the undersigned as attorney(s) for: [client(s)]

(A) (B) Signature

Signature

Name

Name

Firm

Firm

Street Address

Street Address

City/State/ZIP

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Environmental Law Issues in Eminent Domain Litigation MICHELE S. GONZALES

Elle Law Group LLC Oak Park

MARK J. STEGER Clark Hill PLC Chicago

12



I. Introduction A. [12.1] Relationship Between Environmental Laws and Eminent Domain Litigation B. [12.2] Historical Development of Environmental Law II. [12.3] Environmental Laws That May Impose Liabilities A. [12.4] Federal and State Superfund Laws 1. [12.5] Liabilities Under CERCLA 2. [12.6] Extent of Financial Liability Under CERCLA 3. [12.7] Private Cost Recovery Actions Under CERCLA 4. [12.8] Defenses to Liability Under CERCLA B. [12.9] Resource Conservation and Recovery Act 1. [12.10] RCRA Underground Storage Tank Regulation 2. [12.11] Financial Responsibility Requirements and Illinois Underground Storage

Tank Fund C. [12.12] Toxic Substances Control Act D. [12.13] Clean Air Act E. [12.14] Clean Water Act III. [12.15] Environmental Laws That Can Constrain Development of Property

A. [12.16] Floodplain and Floodway Regulation 1. [12.17] National Flood Insurance Act 2. [12.18] Other Federal Statutes 3. [12.19] State Regulation of Floodplains and Floodways 4. [12.20] Local Regulation of Floodplains and Floodways B. [12.21] Wetlands Regulation C. [12.22] National Environmental Policy Act D. [12.23] Endangered Species Act E. [12.24] Fish and Wildlife Coordination Act IV. Discovery Issues — Right To Inspect Property A. [12.25] Prefiling Property Inspection 1. [12.26] County as Condemnor 2. [12.27] State as Condemnor B. [12.28] Post-Filing Property Inspection

ENVIRONMENTAL LAW ISSUES IN EMINENT DOMAIN LITIGATION


V. Evidentiary Issues A. [12.29] Highest and Best Use 1. [12.30] Evidence of Environmental Conditions Affecting Highest and Best Use 2. [12.31] Evidence of Costs Incurred To Alleviate or Minimize Environmental

Conditions 3. [12.32] Highest and Best Use Dependent on Government Action B. [12.33] Effect of Environmental Conditions on Use of Comparable Sales; General

Rules of Comparable-Sales Approach 1. [12.34] Sales of Properties Equally Affected by Environmental Conditions 2. [12.35] Use of Estimated Costs To Place Properties on Equal Footing 3. [12.36] Comparable Sales with Dissimilar Environmental Conditions C. [12.37] Admission of Substandard or Illegal Condition D. [12.38] Admission of Demonstrative Evidence in Proving Environmental Conditions 1. [12.39] Plats and Plans a. [12.40] Prefiling Plans for Development b. [12.41] Post-Filing Plats or Development Plans 2. [12.42] Photographs 3. [12.43] Contour Maps and Wetland Delineations 4. [12.44] Public Records E. [12.45] Appraisal Standards



I. INTRODUCTION A. [12.1] Relationship Between Environmental Laws and Eminent Domain Litigation Article I, §15, of the Illinois Constitution states: “Private property shall not be taken or damaged for public use without just compensation as provided by law.” In the overwhelming majority of eminent domain cases, the amount of just compensation is determined by reference to the fair cash market value of the property. For eminent domain actions filed on or after January 1, 2007 (i.e., the effective date of the Eminent Domain Act, 735 ILCS 30/1-1-1, et seq.), “fair cash market value” is “the amount of money that a purchaser, willing, but not obligated, to buy the property, would pay to an owner willing, but not obliged, to sell in a voluntary sale.” 735 ILCS 30/10-5-60. (For cases filed prior to January 1, 2007, former §7-121 of the Code of Civil Procedure, 735 ILCS 5/1-101, et seq., applies.) This amount of money shall be determined and ascertained as of the date of filing the complaint to condemn for most cases. City of Chicago v. Eychaner, 2015 IL App (1st) 131833, ¶82, 26 N.E.3d 501, 389 Ill.Dec. 411. But see Forest Preserve District of DuPage County v. First National Bank of Franklin Park, 401 Ill.App.3d 966, 930 N.E.2d 477, 341 Ill.Dec. 267 (2d Dist. 2010) (remanding to trial court for determination of proper date on which to value property when condemnation trial occurred eight years after filing of complaint). Forest Preserve District of DuPage County was affirmed by the Illinois Supreme Court on December 1, 2011. See Forest Preserve District of DuPage County v. First National Bank of Franklin Park, 2011 IL 110759, 961 N.E.2d 775, 356 Ill.Dec. 386, reh’g denied (Jan. 23, 2012). See also Public Building Commission of Chicago v. Yellen, 2013 IL App (1st) 112638, 986 N.E.2d 706, 369 Ill.Dec. 393. The Illinois Supreme Court held that, although §7-121 of the Eminent Domain Act directs that the date of valuation for the purposes of determining just compensation in an eminent domain action is the date the condemnation complaint was filed, that section of the statute is silent as to the date that a “taking” occurs. The date of valuation prescribed by the Eminent Domain Act is not to be confused with the date of taking when applying the United States Supreme Court’s decision in Kirby Forest Industries, Inc. v. United States, 467 U.S. 1, 81 L.Ed.2d 1, 104 S.Ct. 2187, 2198 (1984), in which it was held that if the application of the date of valuation prescribed by statute would “provide the owner substantially less than the fair market value of his property on the date the [government] tenders payment, it violates the Fifth Amendment.” The Illinois Supreme Court concluded that “a taking in Illinois for the purposes of applying Kirby occurs on the date that the government (1) deposits the amount of compensation that has been ascertained and awarded, and (2) acquires title and the right to possess the property.” Forest Preserve District of DuPage County, supra, 2011 IL 110759 at ¶40. See also Cannon v. Forest Preserve District of Cook County, No. 14 C 5611, 2016 WL 2620515 (N.D.Ill. May 9, 2016) (citing Kirby, supra, as support in holding that no taking had occurred when forest preserve district enacted ordinance to create forest preserve once defendants’ property was acquired). Therefore, because (1) eight years passed between the filing of the condemnation complaint and the trial court’s determination of the just compensation amount (due to vigorous litigation of legitimate issues by both the condemnor and the condemnee) and (2) the value of the property on the 1999 filing date was $10.725 million (compared with a minimum of $25.5 million on the date the condemnation award was deposited in 2007), the appellate court appropriately vacated the jury’s verdict as to the value of the property and properly remanded for

ENVIRONMENTAL LAW ISSUES IN EMINENT DOMAIN LITIGATION §12.1


further proceedings to determine if the current value of the property materially differed from the amount of the jury’s verdict such that it could be said, under Kirby, that the property owner was deprived of the constitutional right to due process under the Fifth Amendment to receive just compensation as of the actual date of the taking. Additionally, if the trial commences more than two years after the filing of the complaint to condemn and is not a case brought pursuant to the O’Hare Modernization Act, 620 ILCS 65/1, et seq., the court may, “in the interest of justice and equity,” declare a valuation date not later than the commencement of trial for non-quick-take cases or no later than the date on which the condemning authority took title in quick-take cases. 735 ILCS 30/10-5-60. Section 10-5-60 follows Illinois caselaw:

The measure of compensation is a sum of money that is the equivalent of the value of the property. That means such a sum as the property would sell for cash under ordinary circumstances, assuming that the owner is willing to sell and the purchaser willing to buy. City of Chicago v. Cunnea, 329 Ill. 288, 160 N.E. 559, 562 (1928).

Any factor a willing buyer and seller would take into consideration when buying or selling real estate may be relevant in arriving at fair cash market value in a condemnation case, except for any appreciation or depreciation caused by the improvement. 735 ILCS 30/10-5-60. Typically, factors such as location, frontage, zoning, and access have been considered in land valuation. Environmental factors (e.g., site geology, topography, flooding characteristics, the presence of measurable pollutants in the soil or groundwater) have become more influential factors because of the increasing number of environmental regulations potentially affecting development and purchasers’ enhanced environmental awareness. Environmental factors can influence the highest and best use of property, as well as its market value. Proving that adverse environmental conditions exist and limit a property’s use is often a major goal of the condemnor in a condemnation action. Establishing that environmental conditions do not adversely affect value is often a major goal of the landowner. As a result, knowledge of environmental statutes and regulations and their potential effect on value is not only necessary but also critical to effective representation in a condemnation action. Section 10-5-50 of the Eminent Domain Act (or, for eminent domain actions filed prior to January 1, 2007, former §7-119 of the Code of Civil Procedure) governs admission of evidence in an eminent domain action. P.A. 90-393 (eff. Jan. 1, 1998) amended former §7-119, adding express references to violations of and compliance with environmental laws or regulations. The Eminent Domain Act retained these environmental law provisions:

Evidence is admissible as to: (1) any benefit to the landowner that will result from the public improvement for which the eminent domain proceedings were instituted; (2) any unsafe, unsanitary, substandard, or other illegal condition, use, or occupancy of the property, including any violation of any environmental law or regulation; (3) the effect of such condition on income from or the fair market value of the property; and (4) the reasonable cost of causing the property to be placed in a



legal condition, use, or occupancy, including compliance with environmental laws and regulations. Such evidence is admissible notwithstanding the absence of any official action taken to require the correction or abatement of the illegal condition, use, or occupancy. [Emphasis added.] 735 ILCS 30/10-5-50.

As of this writing, there have been no reported opinions explicitly discussing the environmental references added to the predecessor of §10-5-50 by the 1998 amendments. However, environmental costs have been mentioned in at least one eminent domain decision since the 1998 amendments. In Village of Bellwood v. American National Bank & Trust Company of Chicago, 2011 IL App (1st) 093115, 952 N.E.2d 148, 351 Ill.Dec. 775, the First District reversed the trial court’s denial of the village’s motion to abandon eminent domain proceedings and allowed the abandonment under then §7-110 of the eminent domain statute. Although the village had negotiated and finalized an agreed stipulation and final judgment order with each defendant prior to moving to abandon the condemnation, the village had not yet taken possession of the properties. The agreed stipulation and final judgment order took into account a report obtained by the village from an environmental consulting firm, which determined that two of the properties were contaminated and needed to be remediated and further estimated that the cost to remediate the properties would range from $1,314,000 to $2,050,000. The only Illinois appellate decision in which the court explicitly addressed the relationship between environmental remediation costs and an eminent domain proceeding is one in which the court examined former §7-119 in its pre-1998 amendment form. In Department of Transportation ex rel. People of State of Illinois v. Parr, 259 Ill.App.3d 602, 633 N.E.2d 19, 23, 198 Ill.Dec. 557 (3d Dist. 1994), the appellate court held that “environmental remediation costs are not admissible in eminent domain actions to determine the fair market value of condemned property.” The court reasoned that

(1) environmental remediation costs, standing alone, do not constitute a “condition” affecting the value of the property; and (2) admitting such costs as evidence at an eminent domain proceeding would deprive property owners of their rights and defenses under the Environmental Protection Act. Id.

Unfortunately, the broad statements made in Parr were in response to a certified question on appeal with a sparse factual record. The court did not discuss the exact nature of the contamination on the property. Neither did the court specify what laws were triggered by the presence of the contamination, what obligations were placed on the landowner, and what effect these laws and obligations would have had in the marketplace if the property had been sold. The certified question in Parr was only whether remediation costs were admissible and, if so, whether admission of these costs violated the condemnees’ due-process rights. The first portion of the appellate court’s response — that costs to remedy an illegal condition cannot be admitted when the condemnor has failed to prove the existence of an illegal condition — has questionable viability given the 1998 amendment and the lack of any subsequent change under the admissibility of evidence statute. Whether the environmental language in §10-5-50 of the Eminent Domain Act sufficiently addresses the concerns enunciated in the second portion of the appellate court’s response — that admission of environmental remediation costs would violate the



procedural due-process rights of the owners of condemned property — remains to be decided. See also §12.37 below. The 1998 amendment of the admissibility of evidence statute placed Illinois squarely in line with the majority of jurisdictions that allow admission of environmental contamination and related costs. See, e.g., Northeast CT. Economic Alliance, Inc. v. ATC Partnership, 272 Conn. 14, 861 A.2d 473 (2004) (evidence of environmental contamination and remediation costs was relevant to valuation); State of Tennessee ex rel. Commissioner, Department of Transportation v. Brandon, 898 S.W.2d 224 (Tenn.App. 1994) (same); State of Oregon v. Hughes, 162 Or.App. 414, 986 P.2d 700, 703 (1999) (evidence related to contamination was relevant to valuation); Stafford v. Bryan County Board of Education, 219 Ga.App. 750, 466 S.E.2d 637 (1995) (evidence of environmental condition requiring remediation was relevant to valuation), rev’d on other grounds, 267 Ga. 274 (1996); State of Florida, Department of Transportation v. Finkelstein, 629 So.2d 932 (Fla.App. 1993) (evidence of environmental contamination, remediation costs, and stigma or effects of contamination on value of property was relevant to valuation), approved and remanded, 656 So.2d 921 (Fla. 1995); City of Olathe, Kansas v. Stott, 253 Kan. 687, 861 P.2d 1287 (1993) (evidence of contamination was admissible); Redevelopment Agency of City of Pomona v. Thrifty Oil Co., 4 Cal.App.4th 469, 5 Cal.Rptr.2d 687 (1992) (remediation issue was properly before jury in determining valuation). This chapter discusses the most common environmental statutes that affect real estate. In addition, the chapter discusses the effect of environmental statutes on highest and best use, the use of comparable sales in eminent domain litigation, and the use of evidence relating to environmental conditions. B. [12.2] Historical Development of Environmental Law While there were some early attempts at federal protection of the environment, it was not until the 1970s that the campaign against environmental degradation became a national priority. In January 1970, the National Environmental Policy Act of 1969 (NEPA), Pub.L. No. 91-190, 83 Stat. 852, the first of the major environmental laws, was enacted. Its purpose is to ensure that whenever a federal agency plans to undertake an action that may significantly affect the environment, the agency first considers the environmental consequences of its action. Additional federal environmental legislation followed: 1. In 1970, the Clean Air Act (CAA), Pub.L. No. 88-206, ch. 360, 77 Stat. 392, was enacted in its modern version to create national standards for air quality. In 1977, the Clean Air Act Amendments of 1977 (1977 CAA Amendments), Pub.L. No. 95-95, 91 Stat. 685, amended the CAA to control hazardous air pollutants and to speed attainment of ambient air quality standards. Finally, in 1990, the Clean Air Act Amendments of 1990 (1990 CAA Amendments), Pub.L. No. 101-549, 104 Stat. 2399, amended the CAA to add a permit program, to expand control of hazardous air pollutants, and to address, inter alia, acid rain, attainment of ambient air quality standards, and visibility.



2. In 1970, the Occupational Safety and Health Act of 1970, Pub.L. No. 91-596, 84 Stat. 1590, was enacted to protect workers from safety and health hazards. 3. In 1972, the Federal Water Pollution Control Act Amendments of 1972, Pub.L. No. 92-500, 86 Stat. 816, was enacted, substantially amending the Federal Water Pollution Control Act (commonly known as the Clean Water Act (CWA)), ch. 758, 62 Stat. 1155 (1948), to strengthen water pollution control and to regulate wetlands. The CWA was amended by the Water Quality Act of 1987, Pub.L. No. 100-4, 101 Stat. 7, which addressed, inter alia, toxic pollution and nonpoint source (storm water) pollution. 4. In 1974, the Safe Drinking Water Act of 1974 (SDWA), ch. 373, Title XIV, as added by Pub.L. No. 93-523, §2(a), 88 Stat 1660, was passed to control drinking water quality and groundwater pollution. In 1986, the SDWA was amended by the Safe Drinking Water Act Amendments of 1986, Pub.L. No. 99-339, 100 Stat. 642, which expanded United States Environmental Protection Agency (USEPA) regulation of contaminants in drinking water and groundwater protection enforcement. 5. In 1972, Congress strengthened the Federal Insecticide, Fungicide, and Rodenticide Act (FIFRA), ch. 125, 61 Stat. 163 (1947), to regulate the registration and distribution of pesticides. 6. In 1976, the Resource Conservation and Recovery Act of 1976 (RCRA), Pub.L. No. 94-580, 90 Stat. 2795, which amended the Solid Waste Disposal Act (SWDA), Pub.L. No. 89-272, Title II, 79 Stat. 997, was enacted to create a nationwide set of regulations for the management of solid and hazardous waste. In 1984, RCRA was amended by the Hazardous and Solid Waste Amendments of 1984 (HSWA), Pub.L. No. 98-616, 98 Stat. 3221, which established, inter alia, land disposal restrictions, corrective action, permitting, and small generator requirements. 7. In 1976, the Toxic Substances Control Act (TSCA), Pub.L. No. 94-469, 90 Stat. 2003, was enacted to require the evaluation and regulation of new and existing chemicals including polychlorinated biphenyls (PCBs), asbestos in schools, and lead-based paint. In 2016, the TSCA was amended by the Frank R. Lautenberg Chemical Safety for the 21st Century Act, Pub.L. No. 114-182, 130 Stat.448 (2016), to add a new requirement requiring the USEPA to conduct a risk evaluation of all chemicals. 8. In 1980, the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (CERCLA), Pub.L. No. 96-510, 94 Stat. 2767 (also known as “Superfund”), was enacted to clean up abandoned and uncontrolled hazardous substance contamination. CERCLA was amended in 1986 by the Superfund Amendments and Reauthorization Act of 1986 (SARA), Pub.L. No. 99-499, 100 Stat. 1613 (adding innocent-landowner defense), and again in 2002, by the Small Business Liability Relief and Brownfields Revitalization and Environmental Restoration Act, Pub.L. No. 107-118, 115 Stat. 2360 (2002) (adding liability exemptions for bona fide prospective purchasers and contiguous property owners).



Many other federal environmental laws, such as those aimed at protecting or regulating land use, parks, beaches, marine animals, noise, and energy production, have also been enacted since the 1970s. The development of environmental law in Illinois has paralleled the development of environmental law on the federal level. In 1970, the Environmental Protection Act (Illinois Act), 415 ILCS 5/1, et seq., was adopted. The Illinois Act is the statutory basis of nearly all environmental regulatory requirements and provides the mechanism by which most federal environmental laws are implemented in Illinois. The Illinois Act created the Illinois Environmental Protection Agency (IEPA) and the Pollution Control Board (IPCB). The IEPA is given the authority to administer all of the federal environmental regulatory programs enacted under the above-mentioned federal statutes, including enforcement authority. 415 ILCS 5/4(l). The IPCB is given rulemaking powers to promulgate regulations to implement the substantive titles of the Illinois Act as well as to adopt standards or rules that are identical in substance or are otherwise necessary to comply with federal environmental statutes and regulations. 415 ILCS 5/5(b), 5/5(c). In addition to rulemaking authority, the Illinois Act gives the IPCB quasi-judicial functions to adjudicate public and private administrative complaints that allege violations of the Illinois Act or IPCB regulations, to review IEPA permit decisions, and to grant variances. 415 ILCS 5/31 – 5/33, 5/35, 5/40. II. [12.3] ENVIRONMENTAL LAWS THAT MAY IMPOSE LIABILITIES Many federal and state environmental statutes impose liabilities that can affect the market value of property. Sections 12.4 – 12.14 below summarize the most significant of these statutes. A. [12.4] Federal and State Superfund Laws As noted in §12.2 above, “Superfund” is the popular name for CERCLA. It became law as Congress’ response in the waning moments of the Carter presidency to such popularized environmental horrors as Love Canal and the Valley of the Drums. CERCLA created a federal program to identify sites at which hazardous substances have been released into the environment, to ensure that they are cleaned up by the government or by liable parties, to evaluate damages to natural resources, and to create a cost reimbursement procedure for parties, including the federal and state governments, that have cleaned up sites or incurred expenses to restore natural resources but that were not required by law to do so. In Illinois, the Environmental Protection Act contains provisions borrowed from CERCLA that establish the identical liability scheme as CERCLA. 415 ILCS 5/22.2(f) – 5/22.2(k). CERCLA is primarily a retrospective statute, intended to remedy environmental damage from releases of hazardous substances that have already occurred. The hazardous substances regulated under CERCLA are defined by reference to other environmental statutes. The term “hazardous substance” includes a wide range of substances, including any substance designated as “hazardous” under the Clean Water Act, the Clean Air Act, the Toxic Substances Control Act, and special CERCLA regulations and any “hazardous waste” under the Resource Conservation and Recovery Act. However, hazardous substances under CERCLA do not include petroleum products, including crude oil or any fraction thereof if not otherwise identified in the referenced



statutes, natural gas, natural gas liquids, liquefied natural gas, or synthetic gas usable as fuel. 42 U.S.C. §9601(14). CERCLA initially required owners, operators, and other specified entities to notify the USEPA by June 1981 of locations at which hazardous substances had been released in the past. CERCLA currently requires reports to the National Response Center when a hazardous substance is released into the environment in an amount that exceeds the reportable quantity for that hazardous substance. 42 U.S.C. §§9603(a), 9603(c). Under CERCLA, the USEPA is authorized to arrange for the investigation and remediation of sites at which hazardous substances have been released or are threatened to be released. 42 U.S.C. §9604. The USEPA can require liable parties, including private parties as well as state and federal governmental entities known as potentially responsible parties (PRPs), to conduct the investigation and remediation or, alternatively, may itself conduct these activities using money from the Hazardous Substance Superfund. Id.; 42 U.S.C. §9606. In the latter circumstance, the USEPA will seek reimbursement of its cleanup costs from any financially viable PRPs it can find. 42 U.S.C. §9607. 1. [12.5] Liabilities Under CERCLA CERCLA imposes financial liability for cleanup (response) costs on the following classes of persons: a. the current owner and operator of the facility (i.e., the site of the release), regardless of

whether the owner or operator had any role in the release of the hazardous substances; b. the owner and operator of the facility at the time the disposal or release of the hazardous

substances occurred; c. any person who “arranged for” the treatment or disposal of the hazardous substances at

the facility (commonly known as a “generator”); and d. any person who transported the hazardous substances to the facility if such person

selected the facility as the place where the hazardous substances were to be disposed of. 42 U.S.C. §9607(a).

In the context of response cost liability under CERCLA, an important exception exists to the rule that owners and operators of contaminated facilities are always liable. This exception is created by CERCLA’s definition of the term “owner or operator”:

The term “owner or operator” does not include a unit of State or local government which acquired ownership or control [of the real property in question] involuntarily through bankruptcy, tax delinquency, abandonment, or other circumstances in which the government involuntarily acquires title by virtue of its function as sovereign. The exclusion provided under this paragraph shall not apply to any State or local government which has caused or contributed to the release or threatened



release of a hazardous substance from the facility. [Emphasis added.] 42 U.S.C. §9601(20)(D).

In Illinois, the definition of the term “owner or operator” in the Superfund provisions of the Environmental Protection Act contains an exception to liability for governmental entities that acquire title by virtue of their function as sovereign. 415 ILCS 5/22.2(h)(2)(H). This definitional exception is similar to the CERCLA definitional exception above, with one important distinction: the Illinois definition does not require the governmental entity to have involuntarily acquired the property for the exception to apply. Because, in eminent domain, the condemnor in one sense does not involuntarily acquire title to property, it is an open question whether CERCLA’s definitional exception would shield from liability a governmental entity that acquired contaminated property by condemnation. Under the Illinois Superfund provisions, however, the “owner and operator” definitional exception would shield from liability a governmental entity that acquired contaminated property by condemnation. Even if the CERCLA definitional exception does not shield a governmental entity that had condemned contaminated property, the governmental entity can still avoid CERCLA liability by qualifying for the innocent purchaser defense or bona fide prospective purchaser (BFPP) liability exemption, which are discussed in §12.8 below. The Environmental Protection Act could also provide protection from liability for a condemning governmental body. 415 ILCS 5/58.9. These provisions exempt from liability those that did not proximately cause the contamination. 415 ILCS 5/58.9(a). In addition, these provisions also make it clear that the state or a unit of local government cannot be required to remediate a site if it voluntarily acquires ownership or control of the site through purchase, appropriation, or other means, unless the state or unit of local government takes possession of the site and exercises actual, direct, and continual or recurrent managerial control in the operation of the site that causes a release or substantial threat of a release of a regulated substance that requires remediation. 415 ILCS 5/58.9(a)(2)(D). The courts have interpreted CERCLA to be retroactive in application, to provide for strict liability without regard to fault and, in certain circumstances, to impose joint and several liability. United States v. Chem-Dyne Corp., 572 F.Supp. 802, 810 (S.D. Ohio 1983). The notion of joint and several liability means that at a site at which the environmental damage is indivisible a single, potentially responsible party could be held liable individually for the entire cost of the remedy, with the burden then falling on this individual PRP to commence litigation to obtain contribution from other liable parties. On May 4, 2009, the United States Supreme Court decided Burlington Northern & Santa Fe R.R. v. United States, 556 U.S. 599, 173 L.Ed. 2d 812, 129 S.Ct. 1870 (2009), in which the Court concluded that joint and several liability under Chem-Dyne, supra, was not required in every CERCLA action. The Court indicated that CERCLA does not contain the joint and several liability language. It affirmed prior holdings that CERCLA liability may be apportioned among the liable parties if there is a reasonable basis for determining the contribution of each party to a single harm using the RESTATEMENT (SECOND) OF TORTS §433A (1965). The burden of



establishing apportionment is on the party seeking to avoid joint and several liability. If there is no basis for apportionment, then joint and several liability remains. Because CERCLA imposes strict liability, the USEPA can recover response costs from a PRP without proving intent, negligence, or fault. O’Neil v. Picillo, 682 F.Supp. 706, 725 (D.R.I. 1988), aff’d, 883 F.2d 176 (1st Cir. 1989), cert. denied, 110 S.Ct. 1115 (1990). To establish that a party is liable, the USEPA needs to prove that there has been a release or threat of release of a hazardous substance at a site, that as a result the government has incurred response costs that were necessary and consistent with the National Contingency Plan (NCP), and that the party falls within one of the four categories of responsible parties. Control Data Corp. v. S.C.S.C. Corp., 53 F.3d 930 (8th Cir. 1995). Because of the joint and several liability provisions of 42 U.S.C. §9607, the USEPA may seek to collect all costs of the cleanup from only one PRP or a few PRPs. The government’s typical practice is to sue some but not all PRPs based on the volume and toxicity of the materials each sent to the site and other factors. PRPs who are sued typically will investigate to determine whether others may also be PRPs. If financially viable parties are discovered who also fit within any of the liable party categories, they usually will be sued for contribution. 2. [12.6] Extent of Financial Liability Under CERCLA In private contribution actions (i.e., actions in which one or more private potentially responsible parties who do the cleanup sue others for contribution), CERCLA imposes liability for response costs that are “consistent with” the National Contingency Plan. 42 U.S.C. §9607(a)(4)(B). In contrast, if the United States or a state seeks to recover such response costs, the standard for cost recovery is “not inconsistent with” the NCP. 42 U.S.C. §9607(a)(4)(A). The NCP is the basic regulatory structure for federal response actions under CERCLA. See 40 C.F.R. pt. 300. It includes the Hazard Ranking System, which is the system used to evaluate contaminated sites to determine the priority in which they should be slated for cleanup (see 40 C.F.R. pt. 300, app. A), and procedures and standards for responding to releases of hazardous substances. The NCP regulations are subject to periodic revisions. In addition to cleanup costs, recoverable response costs include governmental administrative costs, consultants’ fees, certain types of attorneys’ fees, damages for injury to natural resources, the costs of assessing injuries, and indirect costs of operating the CERCLA program. See 42 U.S.C. §§9601(23), 9601(24); Key Tronic Corp. v. United States, 511 U.S. 809, 128 L.Ed.2d 797, 114 S.Ct. 1960 (1994); United States v. R.W. Meyer, Inc., 889 F.2d 1497 (6th Cir. 1989). However, in Key Tronic, the U.S. Supreme Court ruled that a private litigant’s attorneys’ fees associated with bringing a cost recovery action and fees incurred in negotiating a consent decree with the government were not recoverable under CERCLA. 114 S.Ct. at 1968. Other recoverable costs include those relating to health assessment or health effects studies conducted by the Agency for Toxic Substances and Disease Registry. 42 U.S.C. §9607(a)(4)(D). In addition to response cost liability, any person who is liable under CERCLA and who fails without sufficient cause to provide removal or remedial action in response to an order issued by the USEPA under 42 U.S.C. §9604 or §9606 may also be liable for civil penalties of up to $53,907 (inflation-adjusted) per day or punitive damages of up to triple the costs incurred by the government in cleaning up the site. 42 U.S.C. §§9606(b)(1), 9607(c)(3).



3. [12.7] Private Cost Recovery Actions Under CERCLA CERCLA expressly allows private parties to seek cost recovery or contribution from other parties who are liable as potentially responsible parties. 42 U.S.C. §§9607(a)(4)(B), 9613(f). There are different requirements that must be satisfied in order for a private party to bring either a cost recovery action under §9607 or a contribution action under §9613. A private party may bring a cost recovery action or a contribution action under CERCLA depending on the circumstances under which the costs were incurred. In addition, if the USEPA or any other entity sues a PRP to recover response costs, the PRP may seek contribution from other PRPs who have not paid their fair shares of the cleanup. 42 U.S.C. §9613(f)(3). A PRP that has resolved its liability in a settlement with the government receives contribution protection and will not be liable to nonsettling PRPs for response costs regarding matters addressed in the settlement. 42 U.S.C. §9613(f)(2). 4. [12.8] Defenses to Liability Under CERCLA A potentially responsible party can avoid liability under CERCLA if the PRP can establish by a preponderance of the evidence that the release or threat of release and its consequences were due solely to an act of God, an act of war, or an act or omission of a third party other than an employee or agent of the PRP as long as the third party’s act or omission did not occur in connection with a “contractual relationship” that existed directly or indirectly with the PRP. 42 U.S.C. §9607(b). Two of the more important defenses under CERCLA are referred to as the innocent purchaser defense and the bona fide prospective purchaser defense. These defenses may shield the owner of contaminated property from liability for releases of hazardous substances that occurred before the owner came into title. The Environmental Protection Act incorporates the innocent purchaser defense but does not provide for a BFPP defense to liability. The innocent purchaser defense is created through a combined reading of 42 U.S.C. §§9607(b)(3) and 9601(35)(A) (and their virtually identical counterparts, 415 ILCS 5/22.2(j)(1) and 5/22.2(j)(6)(A)). 42 U.S.C. §9607(b) provides, in pertinent part:

There shall be no liability . . . for a person otherwise liable who can establish by a preponderance of the evidence that the release or threat of release of a hazardous substance and the damages resulting therefrom were caused solely by —

* * *

(3) an act or omission of a third party other than an employee or agent of the defendant, or than one whose act or omission occurs in connection with a contractual relationship, existing directly or indirectly, with the defendant . . . if the defendant establishes by a preponderance of the evidence that (a) he exercised due care with respect to the hazardous substance concerned, taking into



consideration the characteristics of such hazardous substance, in light of all relevant facts and circumstances, and (b) he took precautions against foreseeable acts or omissions of any such third party and the consequences that could foreseeably result from such acts or omissions. [Emphasis added.]

In essence, the innocent purchaser defense is available to an owner that can show (a) that the hazardous condition of the property was caused by the act or omission of someone else and (b) that the owner has not done anything to exacerbate the hazardous condition. The availability of the defense, however, turns on the contractual relationship issue. CERCLA defines “contractual relationship” to include “land contracts, deeds, easements, leases, or other instruments transferring title or possession” to real estate. 42 U.S.C. §9601(35)(A). An otherwise innocent purchaser can be liable for the acts of a previous owner who conveyed title to contaminated property to the purchaser because the purchaser is deemed to have a “contractual relationship” with the previous owner. CERCLA, however, creates three exceptions to the “contractual relationship” definition applicable in circumstances in which a landowner has acquired a contaminated property after the disposal or placement of the hazardous substances that are the source of the release and in which the landowner has complied with the additional conditions required under the innocent purchaser defense; i.e., the owner has exercised due care with respect to the hazardous substances involved and has taken precautions against the foreseeable acts and omissions of third parties that might exacerbate the hazardous condition of the property. 42 U.S.C. §9607(b); 415 ILCS 5/22.2(j)(1)(C). The three CERCLA exceptions are available in the following situations:

(i) At the time the defendant acquired the facility the defendant did not know and had no reason to know that any hazardous substance which is the subject of the release or threatened release was disposed of on, in, or at the facility. (ii) The defendant is a government entity which acquired the facility by escheat, or through any other involuntary transfer or acquisition, or through the exercise of eminent domain authority by purchase or condemnation. (iii) The defendant acquired the facility by inheritance or bequest. [Emphasis added.] 42 U.S.C. §9601(35)(A).

See also 415 ILCS 5/22.2(j)(6)(A). The traditional thought, as set forth above, is that an otherwise innocent purchaser would be liable for hazardous substance releases of a prior owner by virtue of the contract of conveyance from the prior owner, which constitutes a contractual relationship. However, it has been held that the innocent purchaser defense can apply unless the hazardous substance release resulted from an act of the prior owner that occurred “in connection with” the contractual relationship with the purchaser. United States v. Cordova Chemical Company of Michigan, 113 F.3d 572, 583 (6th Cir.



1997). Because hazardous substance releases do not typically occur in connection with conveyance contracts, under Cordova Chemical, most innocent purchasers will remain eligible for the defense if the conveyance contract was the only contractual relationship with the prior owner. To qualify for the first exception, the purchaser must establish that it had no reason to know of the release at the time of acquisition. To establish this fact, the purchaser must have made “all appropriate inquiries” into the previous ownership and uses of the property “in accordance with generally accepted good commercial and customary standards and practices.” 42 U.S.C. §9601(35)(B). See also 415 ILCS 5/22.2(j)(6)(B). In this regard, CERCLA was amended by the Small Business Liability Relief and Brownfields Revitalization and Environmental Restoration Act of 2001, to define further the “reason to know” provision. These amendments required the USEPA to adopt regulations setting forth what constitutes “all appropriate inquiries.” 42 U.S.C. §9601(35)(B)(ii). These regulations were adopted in November 2005 and became effective November 1, 2006. See 70 Fed.Reg. 66,070 (Nov. 1, 2005), adding 40 C.F.R. pt. 312. Prior to the regulations being adopted, the 2002 amendments provided for two default standards for all appropriate inquiries depending on whether the property was purchased before or after May 31, 1997. 42 U.S.C. §9601(35)(B)(iv). For properties purchased before May 31, 1997, all appropriate inquiries would take into account any specialized knowledge or experience on the part of the purchaser, the relationship of the purchase price to the value of the property if uncontaminated, commonly known or reasonably ascertainable information about the property, the obviousness of the presence or likely presence of contamination at the property, and the ability to detect the contamination by appropriate inspection. For properties purchased after May 31, 1997, “all appropriate inquiries” is defined as the procedures set forth in the then most current version of American Society for Testing and Materials (ASTM), Standard Practice for Environmental Site Assessments: Phase I Environmental Site Assessment Process, E1527. Id. Note that the specific ASTM Standard referenced in the amendments was Standard E1527-97, but in the November 2005 rulemaking, the USEPA adopted a regulation that had allowed the use of the updated Standard E1527-05. In 2014, the ASTM Standard was again updated, and USEPA amended the regulations to reflect the updated standard. See 79 Fed.Reg. 60,087 (October 6, 2014). The second exception under 42 U.S.C. §9601(35)(A)(ii) clearly provides governmental entities acquiring title to property by eminent domain with a method to qualify for the innocent purchaser defense. This affirmative defense has been successfully used by at least one governmental entity that acquired contaminated property by condemnation and was subsequently sued under CERCLA for contribution. See United States v. Petersen Sand & Gravel, Inc., 806 F.Supp. 1346 (N.D.Ill. 1992). In Peterson Sand & Gravel, Peterson sued the Lake County Forest Preserve District, which had filed a proceeding to condemn the Peterson site in 1974 and had obtained a final condemnation judgment in 1982. Peterson argued that the district was not entitled to the innocent purchaser defense because it legally acquired the site when it filed its condemnation petition in 1974, before the disposal of hazardous substances had occurred. The court rejected this contention, holding that a condemnor in Illinois may benefit from CERCLA’s



innocent purchaser defense provided the disposal occurred before the condemnor paid just compensation and actually received title to the property. Read together, 42 U.S.C. §§9607(b)(3) and 9601(35)(A) (and their Illinois counterparts, 415 ILCS 5/22.2(j)(1) and 5/22.2(j)(6)(A)) require a condemning governmental entity, in order to protect itself as an innocent purchaser of contaminated property, to show the following facts: a. The property was acquired through exercise of its eminent domain authority. Thus, even when a landowner is willing to convey property voluntarily to the condemnor, the conveyance should make clear that it was done in the context of an eminent domain proceeding. (This fact does not necessarily mean that a condemnation complaint must be filed in all takings, but it does suggest that a voluntary transfer made under threat of condemnation should in some manner be documented as to the circumstances.) b. The property was acquired after hazardous substances that caused the release were placed on the property. (And the condemning governmental entity did not place or allow hazardous substances to be placed on the property after acquisition.) c. The condemning entity did not contribute to or cause the release or threatened release of hazardous substances in any way. The release or threat of release must have been caused solely by a third party. (NOTE: No employee or agent of the condemning governmental entity, such as a waste hauler, landfill operator, or incinerator operator, can have caused or contributed to a release if the condemnor is to use this defense.) d. Upon discovering the release, the condemning entity exercised due care and took precautions against foreseeable acts of third parties. (Whether “due care” requires abatement of the hazardous condition and what precautions must be taken are unclear.) Regardless of whether a condemning governmental body can qualify for the innocent purchaser defense, if it had no involvement with the contamination at the property that it is condemning, it is exempt from liability under the Illinois Superfund statute if it did not proximately cause contamination. 415 ILCS 5/58.9(a). This provision would not protect a condemning governmental entity from liability if it were to cause additional hazardous substance releases after the condemnation. The bona fide prospective purchaser provisions were also included in the 2002 CERCLA amendments. A BFPP is one that acquires ownership of the property after January 2002 and establishes that it acquired the facility after the disposal of hazardous substances and that it conducted all appropriate inquiries into the previous ownership and use of the facility. In addition, the BFPP must provide all required notices, exercise appropriate care with respect to the hazardous substances found on the facility, cooperate with the governmental authority to provide assistance and access to the facility, comply with any institutional controls on the property, and not be affiliated with an otherwise liable party. 42 U.S.C. §§9601(40), 9607(r). Unlike the innocent landowner defense, the BFPP defense to liability can be asserted even with knowledge of the contamination.



CERCLA and the Illinois Superfund provisions can affect the fair cash market value of contaminated property because they potentially subject the current owner of the property and those who might purchase the property to expensive investigation and remediation costs. Depending on the extent to which the property is contaminated, CERCLA reduces the property’s fair cash market value by limiting the number of willing buyers who would purchase the property in its contaminated condition and by reducing the price a willing buyer would pay. B. [12.9] Resource Conservation and Recovery Act As noted in §12.2 above, RCRA was enacted in 1976 and was substantially amended by the Hazardous and Solid Waste Amendments of 1984. RCRA’s stated objectives are to protect human health and the environment and to conserve valuable material and energy resources. 42 U.S.C. §6902(a). In Illinois, RCRA is implemented by the IEPA under the auspices of the Illinois hazardous waste program. See 35 Ill.Admin. Code pts. 702 – 729. The most important aspect of RCRA is its establishment of a “cradle-to-grave” management program that tracks and regulates hazardous waste from creation to disposal. 42 U.S.C. §6922(a)(5). Other goals of RCRA include development of nonhazardous solid waste management plans; prohibition of certain management practices (e.g., land disposal of bulk liquid wastes); encouragement of recycling, reuse, and treatment of solid wastes; establishment of guidelines for solid waste management; and promotion of beneficial solid waste management, resource recovery, and resource conservation systems. 42 U.S.C. §6902(a). RCRA also regulates the cleanup of hazardous waste management units (as well as nonhazardous solid waste management units) just as CERCLA regulates the cleanup of hazardous substances. The universe of RCRA’s hazardous wastes is much smaller than the universe of CERCLA’s hazardous substances. “Hazardous wastes” are those solid wastes that are regulated under RCRA because they are listed or because they have the characteristic of being ignitable, corrosive, reactive, or toxic. 40 C.F.R. §261.3(a). RCRA regulates primarily active waste management facilities, while CERCLA focuses on inactive or uncontrolled sites. RCRA also contains extensive provisions for the regulation of underground storage tanks (USTs) that contain petroleum or hazardous substances. 42 U.S.C. §6991, et seq. See §12.10 below. Under RCRA, the USEPA identifies hazardous wastes by regulation. 42 U.S.C. §6921. Persons who treat, store, or dispose of hazardous wastes must obtain a permit and comply with extensive management requirements found in the USEPA regulations. 42 U.S.C. §6925. Transporters of hazardous wastes must also inform the USEPA of their activities. 42 U.S.C. §6923. A manifest must accompany each shipment of hazardous waste from generator to ultimate disposal site so that a record exists by which the hazardous waste can be tracked from generation to final treatment or disposal. 42 U.S.C. §6922(a)(5). Records of wastes generated, transported, and disposed of must be available to regulatory authorities and submitted periodically. 42 U.S.C. §6922(a)(6). RCRA can affect the use of property. If the property being condemned is (or was) a RCRA-regulated hazardous waste treatment, storage, or disposal facility (TSD facility), it is subject to a host of substantive regulatory requirements concerning hazardous waste management. These requirements may include expensive closure of hazardous waste management units (including, in



certain instances, post-closure responsibility for as long as 30 years after closure) or potentially even more expensive corrective action for all solid waste management units (which includes all nonhazardous solid waste management units as well). Corrective action can be required beyond the boundary of the TSD facility if it is necessary to protect human health. 42 U.S.C. §6924(v). RCRA can have the same effect on the fair cash market value of a property containing an out-of-compliance TSD facility that CERCLA can have on the fair cash market value of property contaminated with hazardous substances. In some instances, the costs of RCRA closure and corrective action can exceed the costs of CERCLA remedial actions. Past and present owners can also be subject to suit for injunctive relief if they took part in hazardous waste (or nonhazardous waste) storage, treatment, transportation, or disposal that poses an “imminent and substantial endangerment” to the environment. 42 U.S.C. §6973(a). To obtain such an injunction, the USEPA (or private party) need not prove that an emergency exists but only that the circumstances may present an endangerment. This standard is more lenient than the traditional requirements in equity for injunctive relief. 42 U.S.C. §6928(a); United States v. Price, 688 F.2d 204 (3d Cir. 1982). RCRA does not include a defense similar to CERCLA’s innocent purchaser or bona fide prospective purchaser defenses. Criminal penalties may also be applicable to RCRA violations. 42 U.S.C. §§6928(d), 6928(e). The USEPA has taken the position that RCRA is a strict liability statute, and, therefore, the USEPA will assess civil penalties under 42 U.S.C. §6973(a) regardless of the knowledge of the violator or attempts by the violator to comply with RCRA. United States v. Bliss, 667 F.Supp. 1298, 1313 (E.D.Mo. 1987). The courts will enforce a standard of strict liability for RCRA remediation orders. In the absence of USEPA action, a private party may bring a citizen suit under RCRA against past or present owners, operators, generators, and transporters who have contributed to the past or present handling, storage, treatment, transportation, or disposal of any solid or hazardous waste to force them to remediate a site that presents “an imminent and substantial endangerment.” 42 U.S.C. §6972(a)(1)(B). Unlike CERCLA, however, RCRA’s citizen suit provisions do not provide private parties with a cause of action to recover CERCLA-like private response costs. Meghrig v. KFC Western, Inc., 516 U.S. 479, 134 L.Ed.2d 121, 116 S.Ct. 1251 (1996). 1. [12.10] RCRA Underground Storage Tank Regulation As noted in §12.9 above, RCRA contains a comprehensive program to regulate underground storage tanks containing regulated substances. 42 U.S.C. §6991, et seq. “Regulated substances” include petroleum products and any hazardous substances under CERCLA, except substances that are regulated as hazardous wastes under RCRA. 42 U.S.C. §6991(7). In general, the term “underground storage tank” is defined as any combination of tanks or pipes, the volume of which is ten percent or more below the ground. 42 U.S.C. §6991(10). This definition excludes several types of tanks, such as farm or residential tanks of 1,100-gallon capacity or less that are used to store motor fuel for noncommercial purposes and tanks situated in underground areas such as basements or tunnels where the tanks sit on or above the floor. Id. Under RCRA, owners of USTs were required to notify the appropriate state agency (in Illinois, the Office of the State Fire Marshal (OSFM)) of the age, size, type, location, and uses of



their USTs no later than May 1986. 42 U.S.C. §6991a(a)(1). Owners of USTs that were taken out of operation after January 1, 1974, but were not removed from the ground, were also required to notify the state agency of the existence of these USTs. 42 U.S.C. §6991a(a)(2)(A). For purposes of the UST statute, the term “owner” includes the current owner of the UST if the UST was in operation on November 8, 1984, or, if not, then the owner of the UST is the person who owned it immediately before its use was discontinued. 42 U.S.C. §6991(4). RCRA required the USEPA to establish by regulation a monitoring and corrective action program for USTs. 42 U.S.C. §6991b. In Illinois, as required under RCRA, the Environmental Protection Act, and the Gasoline Storage Act, 430 ILCS 15/0.01, et seq., the OSFM and the Pollution Control Board adopted regulations at least as stringent as those adopted by the USEPA. 415 ILCS 5/22.4(d) (IPCB authority); 430 ILCS 15/2(3)(b) (OSFM authority). The federal UST regulations under 40 C.F.R. pt. 280 establish strict requirements for monitoring potential releases from USTs. In addition, the UST regulations establish strict release reporting requirements. If a UST owner or operator suspects that a release from the UST has occurred, the owner or operator must report the suspected release to the appropriate agency (in Illinois, the Illinois Emergency Management Agency) within 24 hours. 40 C.F.R. §280.50. Suspicion can be in the eye of the beholder. For example, the presence of petroleum odors emanating from the soil near a petroleum UST may require that the owner or operator make a report. It may be too late to wait to confirm the release by other methods (e.g., excavation) before reporting. Once a suspected release has been reported, the owner or operator must undertake an investigation within seven days in order to confirm whether a release did in fact occur (e.g., soil samples and UST tightness tests). 40 C.F.R. §280.52. If the investigation confirms that a release occurred, then the owner or operator must immediately take corrective action. 40 C.F.R. §280.60. Initially, the owner must stop the leak (usually by removing the UST). 40 C.F.R. §280.62. The owner or operator then begins a corrective action program, which may include the removal and treatment of contaminated soil and groundwater, and must submit a series of reports that include information about the release, its impact on the environment, and the methods by which it will be remediated. 40 C.F.R. §280.63. UST owners or operators who fail to comply can be liable for civil penalties of up to $56,467 (inflaction-adjusted) per day. 42 U.S.C. §6991e(a)(3). Illinois’ UST regulations are virtually identical to those adopted by the USEPA. See 35 Ill.Admin. Code pt. 734. In addition, the Environmental Protection Act provides for the adoption of regulations establishing a remediation program for USTs containing petroleum. See 415 ILCS 5/57, et seq.; 35 Ill.Admin. Code pt. 734. 2. [12.11] Financial Responsibility Requirements and Illinois Underground Storage

Tank Fund The federal underground storage tank regulations under RCRA require owners and operators of USTs containing petroleum to demonstrate that they have the financial ability to take correction actions and compensate third parties for bodily injuries and property damages that could be caused by releases from USTs. See 40 C.F.R. §280.90, et seq. Because conventional



insurance for this type of risk is generally unavailable or prohibitively expensive, the Illinois General Assembly amended the Environmental Protection Act to create the Underground Storage Tank Fund (UST Fund). 415 ILCS 5/57.8. The UST Fund enables tank owners and operators to satisfy the federal financial responsibility requirements. It allows for reimbursement from the UST Fund for certain corrective action costs incurred by owners and operators as a result of a release of petroleum (but not hazardous substances), provided that each of the following prerequisites to eligibility has been met: a. The owner or operator is not the United States government. 415 ILCS 5/57.9(a)(1). b. The UST does not contain fuel that is exempt from the provisions of the Motor Fuel Tax Law, 35 ILCS 505/1, et seq. (e.g., USTs owned by O’Hare and Midway Airports and certain rail carriers). 415 ILCS 5/57.9(a)(2). c. The owner or operator registered the UST with the Office of the State Fire Marshal and paid the required fees. 415 ILCS 5/57.9(a)(4). d. If the claim is for a UST installed after July 28, 1989, the owner or operator can demonstrate that the UST was installed and operated in accordance with the applicable regulations of the Pollution Control Board. Certification of this fact by the OSFM is prima facie evidence of compliance. 415 ILCS 5/57.9(a). e. The owner or operator has not been reimbursed for corrective action costs under a private insurance policy, other written agreement, or court order. 415 ILCS 5/57.9(a)(6). f. The owner or operator notified the Illinois Emergency Management Agency of a confirmed release, and the costs were incurred after the notification. 415 ILCS 5/57.9(a)(5). g. The costs incurred by the owner or operator were associated with “corrective action” approved by the IEPA. 415 ILCS 5/57.9(a)(7). The UST Fund provision that specifies the deductibles that must be paid by owners and operators before they can receive any reimbursement has been amended several times. The deductible provision is summarized as follows: a. A deductible of $10,000 applies for releases reported prior to June 8, 2010, and a deductible of $5,000 applies for releases reported after June 8, 2010. b. A deductible of $100,000 applies when none of the USTs at the site were registered before July 28, 1989, except in the case of USTs used exclusively to store heating oil for consumptive use on the premises where stored and that serve other than farms or residential units, in which case a deductible of $100,000 applies when none of these tanks were registered before July 1, 1992. 415 ILCS 5/57.9(b)(1).



c. A deductible of $50,000 applies when any of the USTs were registered before July 28, 1989, and the state received notice of the confirmed release before July 28, 1989. 415 ILCS 5/57.9(b)(2). d. A deductible of $15,000 applies when one or more, but not all, of the USTs were registered before July 28, 1989, and the state received notice of the confirmed release on or after July 28, 1989. 415 ILCS 5/57.9(b)(3). The deductible applies annually for each site at which costs are incurred under a claim submitted against the UST Fund. If, however, corrective action in response to an occurrence takes place over a period of more than one year, no deductibles apply in the subsequent years for costs incurred in response to the occurrence. 415 ILCS 5/57.9(b). If an agency of the United States government were to condemn property containing a leaking UST, the agency would not be eligible for reimbursement from the UST Fund. 415 ILCS 5/57.9(a)(1). However, the Environmental Protection Act does not preclude an agency or political subdivision of the State of Illinois from obtaining reimbursement from the UST Fund as long as the UST Fund’s prerequisites to eligibility have been satisfied. Therefore, a state governmental entity could obtain reimbursement from the UST Fund after condemning property containing a leaking UST. C. [12.12] Toxic Substances Control Act The Toxic Substances Control Act regulates the manufacturing, processing, and distribution of hazardous chemical substances and mixtures. The 2016 TSCA amendments were signed into law in June 2016, and the new risk evaluation provisions for all chemicals have yet to be adopted. Under the TSCA, no person may manufacture a new chemical substance or use a chemical substance in a manner that constitutes a significant new use without first providing notice to the USEPA. 15 U.S.C. §2604(a)(1). The TSCA also requires that records be kept of complaints that a substance has caused adverse reactions to health or the environment. 15 U.S.C. §2607(c). Complaints that require reporting can originate from employees, consumers, or any other source. Any manufacturer, processor, or distributor who learns of information that supports the conclusion that a chemical substance or mixture presents a risk of injury to health or the environment must report the information to the USEPA. 15 U.S.C. §2607(e). In addition to new chemical substance notices, test data must be submitted to the USEPA concerning the effects of the chemical on health and the environment. 15 U.S.C. §2603(a). This information is submitted in the form of a premanufacture notice. See 40 C.F.R. pt. 720. Depending on the USEPA’s evaluation of this information, the use of the substance may be regulated. For example, the TSCA regulates polychlorinated biphenyls by prohibiting the manufacture, processing, distribution, or use of PCBs except in a “totally enclosed manner.” 15 U.S.C. §2605(e)(2)(A). PCBs are part of a related group of chlorinated organic compounds that were commonly used as fluids in electrical transformers and capacitors during the 1950s through the late 1970s. The USEPA has also adopted regulations under the TSCA that, among other



things, sets forth a self-implementing cleanup program for property at which PCBs are present in certain concentrations. The TSCA also regulates asbestos. Any material that contains more than one percent of asbestos by weight is considered an “asbestos-containing material” (ACM) and is subject to regulation. 15 U.S.C. §2642(4). ACMs can take any number of forms. “Friable” asbestos (i.e., asbestos that can be reduced to powder by hand pressure) is the most dangerous type of asbestos. When asbestos is removed from buildings, it must be removed by hand, and airborne fibers must generally be kept within the building through a negative air pressure system. 29 C.F.R. §1926.1101(g). The TSCA regulatory requirements can affect the fair cash market value of real property. Cleanup of PCBs and asbestos removal projects can be very expensive in the same manner as remediations under CERCLA or closure requirements under RCRA. D. [12.13] Clean Air Act The Clean Air Act provides the regulatory vehicle for prevention and control of emissions into the air of substances that may harm human health or the environment. The CAA regulates both stationary sources of pollutants (e.g., factories) and mobile sources of pollutants (e.g., automobiles, trucks, and airplanes). 42 U.S.C. §§7411, 7521. Under the CAA, the USEPA has set national ambient air quality standards for certain identified pollutants at levels that can be safely tolerated. These national standards must be met in all areas of the United States (42 U.S.C. §7409), and plans must be developed either to attain the standard if an area does not meet the standard or to maintain the standard if the area meets the standard. Stationary air pollutant sources are regulated through a system of national emission limits and permits for individual emission sources. See 42 U.S.C. §7411. Both new and existing sources must comply with the emission limitations and other standards imposed under the CAA. The amount and rate of allowable emissions depend on the type and age of the emission source and the type of pollutant involved. See 42 U.S.C. §§7411, 7412. Sophisticated and expensive pollution control equipment is required for many sources to comply with applicable emission limitations. Permit issuance and enforcement are carried out by states that have adopted USEPA-approved plans for controlling air pollution, known as “state implementation plans” (SIPs). See 42 U.S.C. §7410. E. [12.14] Clean Water Act The stated goal of the Clean Water Act is for the “restoration and maintenance of chemical, physical and biological integrity” of the surface waters of the United States. 33 U.S.C. §1251(a). To achieve this goal, the CWA regulates the discharge of both toxic and conventional pollutants into waterways by municipal, industrial, and other sources. 33 U.S.C. §1312. These sources are generally classified as point sources (i.e., well-defined points such as discharge pipes or other discrete conveyances from which pollutants enter waterways) and nonpoint sources (i.e., runoff



that enters surface waters from areas such as farmlands, roads, and city streets). 33 U.S.C. §§1312, 1329. Point source discharges of pollutants (which include dredged spoil, solid waste, incinerator residue, sewage, garbage, chemical wastes, and biological materials) into waters of the United States (defined to include virtually any surface water) are prohibited unless authorized by a National Pollutant Discharge Elimination System (NPDES) permit. 33 U.S.C. §1342. NPDES permits require that discharges be controlled, sampled, and analyzed on a periodic basis (typically monthly) to ensure that discharge limitations are being met. Permitees must submit discharge monitoring reports to the appropriate state agency (in Illinois, the IEPA) and the USEPA demonstrating continuing permit compliance. Industrial and municipal non-point source discharges of storm water (i.e., rainfall or snowmelt runoff) must have NPDES permits. 33 U.S.C. §1342(p). Section 404 of the CWA also requires a permit for the deposit of dredged or fill materials into navigable waters or wetlands. 33 U.S.C. §1344. These §404 permits are issued by the United States Army Corps of Engineers in conjunction with the USEPA. Regulation of wetlands under the CWA is discussed in §12.21 below. The Clean Air Act, the CWA, and other environmental laws that directly regulate the operation of emission sources to the atmosphere and point or non-point source discharges to waters may be relevant in condemnation cases involving regulated sources because they can significantly affect the value of the property being condemned. If an industrial facility on the subject property is not in compliance with applicable environmental regulations, the fair cash market value of the property should be considered in light of the amount that it would cost the facility’s owner to bring the facility into compliance with CAA or CWA regulatory requirements. Unlike those situations in which property being condemned is contaminated and costs of remediation may be somewhat uncertain, in these instances regulatory compliance costs often can be determined with specificity. No rational buyer would agree to purchase an out-of-compliance industrial facility without obtaining an adjustment in the purchase price that takes into account the amount necessary to bring the facility into compliance because the buyer would know that he or she could not lawfully operate a noncomplying source. Likewise, a developer of property that is not served by a sewer system could be required under the CWA to construct a “package” sewer treatment plant and apply for an NPDES permit to authorize the discharge of treated wastewater from the plant before the property could be developed. Both activities can entail considerable expense, and these costs could affect the value of the property for those uses. III. [12.15] ENVIRONMENTAL LAWS THAT CAN CONSTRAIN DEVELOPMENT

OF PROPERTY Certain state and federal environmental laws can be important in condemnation actions because, in addition to affecting the fair cash market value of the property being condemned, they may also restrict the ability of the owner to develop the property.



A. [12.16] Floodplain and Floodway Regulation Various federal, state, and local laws regulate development within floodplains and floodways. These laws can be important in eminent domain proceedings because they can greatly affect land values. If the use of a condemned property is restricted by floodplain or floodway regulations, the fair cash market value of the site will most often be reduced as a result. See, e.g., Department of Transportation v. LaSalle National Bank, 251 Ill.App.3d 901, 623 N.E.2d 390, 191 Ill.Dec. 145 (2d Dist. 1993). 1. [12.17] National Flood Insurance Act The National Flood Insurance Act of 1968 (NFIA), Pub.L. No. 90-448, Title XIII, 82 Stat. 572, is the principal federal statute governing floodplains and floodways. The NFIA created the National Flood Insurance Program (NFIP), which allows property owners to purchase federally backed flood insurance within communities that participate in the program. See 42 U.S.C. §§4011, 4012(c). It also established the Federal Emergency Management Agency (FEMA) to develop flood risk data for use in insurance rating and floodplain management. FEMA develops flood risk data in the form of flood insurance studies, flood insurance rate maps (FIRMs), flood hazard boundary maps, and flood boundary and floodway maps. These maps identify special flood hazard areas (SFHAs), which are areas subject to inundation by a flood having a one-percent or greater probability of being equaled or exceeded during any given year (often referred as the “100-year flood” or “base flood”). FIRMs indicate the base floodwater elevations and flood insurance risk zones. FIRMs also delineate areas subject to inundation during a 500-year flood and may show areas designated as “regulatory floodways.” A “regulatory floodway” is the channel of a stream plus any adjacent floodplain areas that must be kept free of encroachment so that the 100-year flood discharge can be conveyed without increasing the base floodwater elevation more than a specified amount. 44 C.F.R. §9.4. Under the NFIA, any person seeking financial assistance from any federal agency for acquisition or construction purposes relating to property located in an SFHA must first obtain flood insurance if it has been made available under the NFIP. 42 U.S.C. §4012a(a). A “federal agency” is defined as “any department, agency, corporation, or other entity or instrumentality of the executive branch . . . and includes the Federal National Mortgage Association and the Federal Home Loan Mortgage Corporation.” 42 U.S.C. §4003(a)(2). “Financial assistance” includes “any form of loan, grant, guaranty, insurance, payment, rebate, subsidy, disaster assistance . . . or any other form of direct or indirect Federal assistance.” 42 U.S.C. §4003(a)(3). Flood insurance is available, however, only if the local governmental entity in which the property is located participates in the NFIP. 42 U.S.C. §4012(c). To be eligible for participation in the NFIP, communities are required to implement floodplain management regulations to reduce their flood risks. 42 U.S.C. §4012(c)(2). The regulations require participating communities to consider whether property intended to be developed is located in an area considered to be a flood risk. 44 C.F.R. §60.2. 2. [12.18] Other Federal Statutes In addition to the National Flood Insurance Act, other federal laws also may apply to property



development within floodplains or floodways. 33 U.S.C. §403 prohibits unauthorized obstructions or alterations of navigable waters of the United States. If a floodplain or floodway includes a “water of the United States,” construction of any structure in or over the water or the excavation from or depositing of material into the water may be done only pursuant to a permit issued by the United States Army Corps of Engineers. Id. Similar restrictions exist if a floodplain or floodway is located within an area identified as a wetlands area. Section 12.21 below contains a more detailed discussion of the effects of wetlands regulations on property value. 3. [12.19] State Regulation of Floodplains and Floodways Under the Rivers, Lakes, and Streams Act, 615 ILCS 5/4.9, et seq., the Illinois Department of Natural Resources (IDNR) has jurisdiction over all of the rivers and lakes in Illinois. Development of land bordering on or including any public waters of the state must be approved by the IDNR before construction. 615 ILCS 5/7. In all Illinois counties, a permit is required from the IDNR before any construction can be undertaken on a defined floodplain. 615 ILCS 5/18f. For the metropolitan counties located in the area served by the Northeastern Illinois Planning Commission (i.e., the counties generally within the greater Chicago metropolitan area), new construction is permitted within a 100-year floodway only if it relates to an “appropriate use” of the floodway. 615 ILCS 5/18g(c). A “100-year floodway” is defined as “the channel and that portion of the 100-year floodplain adjacent to a stream or watercourse which is needed to store and convey the 100-year frequency flood discharge without a significant increase [in the flood level].” 615 ILCS 5/18g(d)(1). “Appropriate use” of a floodway includes flood control structures, structures relating to access to water or the shoreline, and other purposes that the IDNR determines to be appropriate and that will not pose a danger to the public. 615 ILCS 5/18g(d)(3). Construction of a new building is specifically excluded as an appropriate use of a floodway unless the building is a garage, storage shed, or other structure accessory to an existing building and the new building does not increase the flood level. Id. As authorized under the Rivers, Lakes, and Streams Act, the IDNR has promulgated regulations that define the type of development permissible in 100-year floodways. Under these regulations, it is unlawful to begin new construction (except repair, remodeling, or maintenance of buildings or structures in existence as of November 18, 1987) within the regulatory floodway of rivers, lakes, and streams of Cook (excluding the City of Chicago), DuPage, Kane, Lake, McHenry, and Will Counties without a permit from the IDNR. 17 Ill.Admin. Code §3708.30. A “regulatory floodway” is defined as “[t]he channel and that portion of the floodplain adjacent to a stream or watercourse as designated by the Department . . . which is needed to store and convey the 100-year frequency flood discharge with no more than a 0.1 foot increase in [flood level] due to the loss of flood conveyance or storage, and no more than a 10% increase in velocities.” [Emphasis omitted.] 17 Ill.Admin. Code §3708.20. Thus, to obtain a permit, the applicant must demonstrate that (a) the proposed construction is an appropriate use of the regulatory floodway and (b) the proposed construction will not reduce the regulatory floodway storage or conveyance and will not increase regulatory floodway velocities. 17 Ill.Admin. Code §3708.70(b). An “appropriate use” of a regulatory floodway is further defined in the regulations to include flood control structures; dikes or dams; pumping and



treatment facilities; facilities related to recreation, boating, or shipping; storm and sanitary sewer outfalls; utility placement; recreational facilities (such as playing fields and trail systems); detached garages, storage sheds, or other non-habitable accessory structures that will not block flood flow; parking lots; sidewalks; and runways. 17 Ill.Admin. Code §3708.70(c). In some instances, the regulations authorize the relocation of the floodway delineation onto the existing “flood fringe” property (i.e., the portion of the floodplain outside the regulatory floodway) provided the new regulatory floodway storage or conveyance effectively compensates for lost regulatory floodway storage or conveyance. 17 Ill.Admin. Code §3708.80(c). The Rivers, Lakes, and Streams Act restrictions on development within floodways were found to be constitutional by the Illinois Supreme Court in Beverly Bank v. Illinois Department of Transportation, 144 Ill.2d 210, 579 N.E.2d 815, 162 Ill.Dec. 1 (1991). In Beverly Bank, the court upheld the denial of a landowner’s application for a permit to construct two single-family dwellings within a floodway, finding that the General Assembly has the authority under the police power to prohibit construction of new residences in areas that would be inundated by a 100-year flood event. The court found that the statute is rationally related to several legitimate state interests and that it bears a substantial relation to public health, safety, and welfare. 579 N.E.2d at 822. 4. [12.20] Local Regulation of Floodplains and Floodways Many units of local government in Illinois have ordinances that regulate the type of development that is permissible within the floodplains and floodways located within their jurisdictions. If a community has adopted restrictions that are at least as restrictive as the Illinois Department of Natural Resources’ regulations, the IDNR is authorized to delegate its permit-writing authority provided that the community has demonstrated that it has adequate staff to enforce the ordinance. 615 ILCS 5/18g(b). Federal, state, and local regulation of floodplains and floodways can frequently affect the fair cash market value of property. Property located in a regulatory floodway or floodplain is often less valuable than property located elsewhere because of the resulting restrictions on its development. Further, with a few exceptions, regardless of the manner in which the property owner intends to develop the property, a permit will be required before development can begin. Permit acquisition alone can be a costly and time-consuming undertaking, thereby affecting the timing of the development of the property. B. [12.21] Wetlands Regulation As noted in §12.14 above, the Clean Water Act prohibits the discharge of dredged or fill materials into the “waters of the United States” (33 U.S.C. §1362(7)) without a permit. 33 U.S.C. §1344. See also 33 C.F.R. §328.3. Wetland fill permits are issued by the United States Army Corps of Engineers. 33 U.S.C. §§1344(d), 1344(e). The USEPA is authorized to veto a Corps permit or to prevent the Corps from issuing a permit if the USEPA determines that a proposed project will have an “unacceptable adverse effect” on municipal water supplies, shellfish beds and



fishery areas (including spawning or breeding areas), wildlife, or recreational areas. 33 U.S.C. §1344(c). The Corps has attempted to increase the number and type of waters of the United States under its CWA jurisdiction. In January 2001, the United States Supreme Court rejected the Corps’ attempt to regulate isolated ponds as waters of the United States. Solid Waste Agency of Northern Cook County v. United States Army Corps of Engineers, 531 U.S. 159, 148 L.Ed.2d 576, 121 S.Ct. 675 (2001). The Corps attempted to assert jurisdiction over isolated ponds on the basis that migrating birds used the ponds. This so-called “migratory bird rule” was rejected by the Supreme Court as exceeding the Corps’ authority under the CWA. The United States Supreme Court in Rapanos v. United States, 547 U.S. 715, 165 L.Ed.2d 159, 126 S.Ct. 2208 (2006), limited the reach of the Corps’ authority to regulate wetlands and waters that are not physically connected or abutting traditionally navigable waters or that do not have a significant nexus to the water quality of a navigable water. In response to the two United States Supreme Court decisions, on June 29, 2015, the USEPA and the Corps adopted a final rule defining the scope of waters protected under the CWA. See 80 Fed.Reg. 37,054 (June 29, 2015). Numerous interested parties filed petitions to review these regulations. It is likely that the Supreme Court will again decide whether these regulations exceed the Corps’ authority under the CWA. “Wetlands” is defined by the Corps and the USEPA as

those areas that are inundated or saturated by surface or groundwater at a frequency and duration sufficient to support, and that under normal circumstances do support, a prevalence of vegetation typically adapted for life in saturated soil conditions. Wetlands generally include swamps, marshes, bogs, and similar areas. 33 C.F.R. §328.3(c)(4) (Corps); 40 C.F.R. §230.3(o)(3)(iv) (USEPA).

The Corps and the USEPA have agreed to use the January 1987 Corps of Engineers Wetlands Delineation Manual, www.cpe.rutgers.edu/wetlands/1987-army-corps-wetlands-delineation-manual.pdf, to determine whether given areas are wetlands. NOTE: The Fish and Wildlife Service has used a different wetlands definition and delineation methodology to develop National Wetlands Inventory maps. These maps are widely referenced but are often misleading for the purpose of establishing jurisdiction over wetlands under the CWA. The Corps and the USEPA have concurrent enforcement authority as set forth in the Memorandum Between the Department of the Army and the Environmental Protection Agency: Federal Enforcement for the Section 404 Program of the Clean Water Act (Jan. 19, 1989), www.epa.gov/cwa-404/federal-enforcement-section-404-program-clean-water-act. The Corps is authorized to issue administrative orders or institute judicial action (seeking injunctions and penalties) to enforce compliance with wetlands fill permits. 33 U.S.C. §1344(s). The Corps also has the authority to assess administrative penalties for violations of wetlands fill permits. 33

http://www.cpe.rutgers.edu/wetlands/1987-army-corps-wetlands-delineation-manual.pdf

http://www.cpe.rutgers.edu/wetlands/1987-army-corps-wetlands-delineation-manual.pdf

https://www.epa.gov/cwa-404/federal-enforcement-section-404-program-clean-water-act



U.S.C. §1319(g)(1)(B). The USEPA may also assess penalties under the CWA for violations of wetlands regulations. 33 U.S.C. §1319(g)(1)(A). To obtain a permit to fill wetlands, the applicant must demonstrate that there is no practicable alternative site for the project that would have a less adverse impact on the aquatic ecosystem. 40 C.F.R. §230.10(a). Unless the project is “water dependent,” it is presumed that an alternative exists. 40 C.F.R. §230.10(a)(3). The applicant must also demonstrate that there is no practicable site design alternative that could avoid filling the wetlands. 40 C.F.R. §230.10(a)(2). Assuming that there is no practicable alternative, the Corps’ issuance of a fill permit will generally be conditioned on compensation for wetland loss (i.e., mitigation), which typically requires the creation or expansion of wetlands in the same watershed, generally on the same site, and on at least a one-to-one ratio. 40 C.F.R. §230.10(d). See also the USEPA and Corps Memorandum of Agreement Between the Department of the Army and the Environmental Protection Agency: The Determination of Mitigation Under the Clean Water Act Section 404(b)(1) Guidelines (Feb. 6, 1990), http://water.epa.gov/lawsregs/guidance/wetlands/mitigate.cfm. A greater ratio of mitigation to fill is usually required. The Corps must conduct a public interest review before it issues a general permit and is therefore sensitive to public comment on proposed wetlands fill projects. 33 C.F.R. §320.4. The Corps has also established a series of nationwide permits that provide for a streamlined permit process. Permittees seeking coverage under a nationwide permit must notify the Corps and comply with the nationwide permit conditions and state water quality certification. Federal regulation of wetlands can be an important factor in condemnation cases because of its effect on property value. If property being condemned contains a significant area of wetlands and thus is of limited development potential, the condemning governmental entity will likely argue that the fair cash market value of the property should reflect these restrictions. The property owner will find it difficult to argue that the condemnation award should be based on the property’s highest and best use as a developed parcel unless he or she can also establish that there is a reasonable probability that he or she could obtain a permit to fill the wetlands on the property in order to achieve that use. See §12.32 below for a discussion of reasonable probability standards. Under certain circumstances, property located within a wetland may have a different highest and best use and a resulting different value than property located outside a wetland. Department of Transportation v. HP/Meachum Land Limited Partnership, 245 Ill.App.3d 252, 614 N.E.2d 485, 185 Ill.Dec. 351 (2d Dist. 1993). But see Department of Transportation v. Kelley, 352 Ill.App.3d 278, 815 N.E.2d 1214, 287 Ill.Dec. 411 (3d Dist. 2004) (declining to extend HP/Meachum because evidence did not establish clearly delineated boundaries between wetland and non-wetland portions of subject property). Actual proof that wetlands are located on a site is best accomplished through the testimony of a qualified engineer. If the engineer’s testimony is competent and relevant, the appraiser may rely on it in formulating an opinion of value. Department of Transportation v. LaSalle National Bank, 251 Ill.App.3d 901, 623 N.E.2d 390, 191 Ill.Dec. 145 (2d Dist. 1993).

http://water.epa.gov/lawsregs/guidance/wetlands/mitigate.cfm



C. [12.22] National Environmental Policy Act The National Environmental Policy Act requires that an environmental assessment be prepared before any agency of the federal government undertakes major federal action that has the potential to significantly affect the quality of the environment. Certain types of federal actions are categorically excluded from review under the NEPA. 40 C.F.R. §1508.4. Based on the information developed in the environmental assessment, the federal agency determines whether to prepare an environmental impact statement (EIS) or a finding of no significant impact (FONSI) for the federal action. 40 C.F.R. §1502.4. A FONSI is issued in cases in which it has been determined that the federal action will not have a significant impact on the environment. 40 C.F.R. §§1501.4(e), 1508.13. A FONSI presents the reasons why the agency believes that the proposed action will not have a significant effect on the environment and includes a summary of the environmental assessment. 40 C.F.R. §§1500.5(l), 1501.4(e), 1508.13. An EIS must explain the environmental impact of the action, including unavoidable adverse impacts, alternatives to the action, and the commitment of resources that will be required if the action is implemented. See 40 C.F.R. §§1502.10 – 1502.16. An EIS also may be required for federal permits, approvals, licenses, and leases when the government is less directly involved. Under the NEPA regulations, a “major federal action” includes “projects and programs entirely or partly financed, assisted, conducted, regulated, or approved by federal agencies.” 40 C.F.R. §1508.18(a). For example, an EIS has been found to be necessary before a coal lease could be approved by the Department of the Interior. Cady v. Morton, 527 F.2d 786 (9th Cir. 1975). Similarly, an EIS was required before the Department of Housing and Urban Development could approve an urban renewal project. Dalsis v. Hills, 424 F.Supp. 784 (W.D.N.Y. 1976). The NEPA can affect a condemnation proceeding. When, for example, the NEPA is applicable to a project for which property is being condemned and its requirements have not been followed, the NEPA can be and has been used by citizens’ groups or individuals who object to the project to halt or delay the condemnation. Aberdeen & Rockfish R.R. v. Students Challenging Regulatory Agency Procedures (S.C.R.A.P.), 422 U.S. 289, 45 L.Ed.2d 191, 95 S.Ct. 2336 (1975). On the other hand, in certain circumstances, statements made in an EIS concerning the highest and best uses of property in the area may not bind the condemnor and, therefore, may not be admitted in evidence. Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 196 Ill.App.3d 5, 552 N.E.2d 1151, 142 Ill.Dec. 410 (2d Dist. 1990). D. [12.23] Endangered Species Act The Endangered Species Act of 1973 (ESA), Pub.L. No. 93-205, 87 Stat. 884, has been characterized by both supporters and opponents as a potent tool to control land use. Like the National Environmental Policy Act, the ESA potentially can be used to halt or delay a condemnation proceeding. The ESA is intended to ensure the conservation and protection of endangered or threatened species of fish, wildlife, and plants. An “endangered species” is any species “in danger of extinction throughout all or a significant portion of its range.” 16 U.S.C. §1532(6). A “threatened species” is “any species which is likely to become an endangered species



within the foreseeable future throughout all or a significant portion of its range.” 16 U.S.C. §1532(20). The Secretary of the Interior (and in some cases the Secretary of Commerce) is required to prepare lists of endangered and threatened species. 16 U.S.C. §1533(a). Any interested person may petition to add or remove any species from the lists. 16 U.S.C. §1533(b)(3). The ESA requires each federal agency to ensure that the actions it funds, authorizes, or carries out are not likely to jeopardize protected species. 16 U.S.C. §1536(a)(2). The agency must inquire of the U.S. Fish and Wildlife Service (FWS) whether any protected species may be present in the area of the proposed action. 16 U.S.C. §1536(c)(1). If the FWS determines that protected species are present, the agency must prepare a “biological assessment” analyzing whether the action is likely to affect these species. Id. If the agency’s assessment concludes that a protected species is likely to be affected, the agency must formally consult with the FWS. This consultation results in the issuance of a biological opinion by the FWS. 16 U.S.C. §1536(b). The planning, data gathering, and analysis obligations imposed on federal agencies by the ESA parallel the requirements imposed by the NEPA. The ESA also prohibits the taking of any endangered species of fish or wildlife. 16 U.S.C. §§1538(a)(1)(B), 1538(a)(1)(C). “Taking” is defined as “to harass, harm, pursue, hunt, shoot, wound, kill, trap, capture, or collect, or to attempt to engage in any such conduct.” 16 U.S.C. §1532(19). “Harm” is defined as “an act which actually kills or injures wildlife” and “may include significant habitat modification or degradation where it actually kills or injures wildlife by significantly impairing essential behavioral patterns, including breeding, feeding or sheltering.” 50 C.F.R. §17.3. Violations of the ESA carry civil penalties of up to $25,000 and criminal penalties of up to $50,000. 16 U.S.C. §§1540(a), 1540(b). The ESA also provides for citizen suit enforcement. 16 U.S.C. §1540(g). Federal courts have jurisdiction over civil actions brought under the citizen suit provisions of the ESA without regard to diversity of citizenship, and no jurisdictional amount is required. 16 U.S.C. §1540(c). Venue lies in the judicial district in which the violation is alleged to have occurred. 16 U.S.C. §1540(g)(3)(A). Standing under the ESA is open to “any person,” subject to the Eleventh Amendment limitation of federal court jurisdiction. 16 U.S.C. §1540(g)(1)(A). See Allied-Signal, Inc. v. Lujan, 736 F.Supp. 1558 (N.D.Cal. 1990). Similarly, any person has standing to seek an injunction to compel the Secretary of the Interior to take action to prevent the taking of any endangered or threatened species. 16 U.S.C. §1540(g)(1)(B). Furthermore, any person may commence suit in a United States district court to enjoin any person (including any government agency) alleged to be in violation of the ESA. 16 U.S.C. §§1540(c), 1540(g)(1)(A). The ESA requires that 60 days’ notice be provided to the Secretary of the Interior before a citizen suit may be filed. 16 U.S.C. §1540(g)(2)(A)(i). The ESA provides the Secretary of the Interior with the authority to authorize incidental takings of protected species pursuant to an approved habitat conservation plan (HCP). 16 U.S.C. §1539(a). Applicants for these permits must prepare HCPs that specify, among other things, the steps they will take to monitor, minimize, and mitigate the impact that will result from the taking and the funding that will be available to implement the steps. 50 C.F.R. §17.22.



As a result of the ESA, land use restrictions can be imposed on property that is (or may constitute) habitat for an endangered species, thus affecting the value of the property. Because the Supreme Court, in Babbitt v. Sweet Home Chapter of Communities for Great Oregon, 515 U.S. 687, 132 L.Ed.2d 597, 115 S.Ct. 2407 (1995), upheld the validity of the Department of the Interior’s regulations defining “harm” to endangered species (50 C.F.R. §17.3), these extensive habitat restrictions are likely to continue. E. [12.24] Fish and Wildlife Coordination Act The Fish and Wildlife Coordination Act (FWCA), ch. 55, 48 Stat. 401, is another environmental law that, like the National Environmental Policy Act and the Endangered Species Act, can be used to stop or delay a condemnation proceeding. The FWCA requires that before a federal agency may permit the diversion or control of surface water or the building of a lake, it must consult with the U.S. Fish and Wildlife Service and the affected state’s natural resource agency. 16 U.S.C. §662(a). Any report prepared by the FWS must be made a part of the NEPA-required environmental impact statement for the project. Id. IV. DISCOVERY ISSUES — RIGHT TO INSPECT PROPERTY A. [12.25] Prefiling Property Inspection Two provisions of the Illinois Highway Code, 605 ILCS 5/1-101, et seq., govern the condemnor’s right to enter private property for the purpose of conducting prefiling discovery. 605 ILCS 5/5-803 is applicable if a county contemplates condemning property for county, township, and district highway purposes. 605 ILCS 5/4-503 applies if the state is the condemnor in the acquisition of the property for state highway purposes. 1. [12.26] County as Condemnor A county’s right to enter property for the purpose of prefiling discovery, in connection with the development of highways, is governed by 605 ILCS 5/5-803, which states:

For the purpose of making surveys and the determination of the amount of property necessary to be taken or damaged in connection with any highway project, the county through its officers, agents or employees, after notice to the owner, may enter upon the lands or waters of any person or corporation, but subject to responsibility for all damages that may be occasioned thereby.

Thus, the county may enter private property to make surveys provided it has notified the owner. However, the county may not enter to obtain subsurface soil samples without both a notice to the owner and consent from the owner. County of Kane v. Elmhurst National Bank, 111 Ill.App.3d 292, 443 N.E.2d 1149, 67 Ill.Dec. 25 (2d Dist. 1982). In Elmhurst National Bank, Kane County filed an equitable bill for discovery against the landowner, requesting permission to enter on the landowner’s property to conduct surveys, soil



tests, and appraisals preliminary to condemning the land for highway expansion. The defendant filed a motion to dismiss, claiming that neither Supreme Court Rule 214 nor 605 ILCS 5/5-803 authorized the relief sought absent the landowner’s consent. The trial court granted the motion for prefiling discovery, including the requests to enter the land, conduct soil tests, and conduct a survey and appraisal. On appeal, the appellate court vacated the portion of the trial court’s order granting the plaintiff permission to enter the defendant’s land for the purpose of conducting soil tests without the defendant’s consent. As to entry without permission for the purpose of surveying and appraising the defendant’s property, the appellate court held:

While there appears to be no particular precedent in Illinois, Section 5-803 of the [Illinois Highway Code] appears typical of statutory provisions allowing bodies with the power of eminent domain to enter the land of others, before the institution of condemnation proceedings, in order to make preliminary surveys or explorations of the land. The basic purpose of such statute is to enable the prospective condemnor to determine whether and how much of the land is suitable for eventual condemnation and thus to facilitate an intelligent, economical condemnation decision. . . . There is no language in Section 5-803 which can be reasonably read to require the prospective condemnor to institute condemnation proceedings before entering the land of others for preliminary surveys or appraisals. [Citations omitted.] 443 N.E.2d at 1152 – 1153.

The court held that the right of entry does not include the right to conduct subsurface soil tests and neither does it include the right to make permanent appropriation or to cause more than minimal or incidental damage in the process of surveying or appraising the property. 443 N.E.2d at 1154. 2. [12.27] State as Condemnor The state’s right to conduct prefiling discovery, including surveys, appraisals, and soil tests, is governed by 605 ILCS 5/4-503:

For the purpose of making subsurface soil surveys, preliminary surveys and determinations of the amount and extent of such land, rights or other property required, the Department, or any county, by its officers, agents or employees, after written notice to the known owners and occupants, if any, may enter upon the lands or waters of any person, but subject to responsibility for all damages which shall be occasioned thereby.

Therefore, the state need only notify the owner. Unlike counties, it need not obtain consent for subsurface soil samples.



B. [12.28] Post-Filing Property Inspection Post-filing requests to perform surface or subsurface tests on real estate are governed by S.Ct. Rule 214:

Any party may by written request direct any other party . . . to permit access to real estate for the purpose of making surface or subsurface inspections or surveys or photographs, or tests or taking samples . . . whenever the nature, contents, or condition of such . . . real estate is relevant to the subject matter of the action.

The Historical and Practice Notes to S.Ct. Rule 214 indicate that it is not “a way around special restrictions on discovery imposed by statutes regulating specific kinds of proceedings, such as the precondemnation discovery provisions of the Roads and Bridges Act.” Albert E. Jenner, Jr. et al., Historical and Practice Notes, S.H.A. (1985), c. 110A, ¶214. The Historical and Practice Notes specifically cite County of Kane v. Elmhurst National Bank, 111 Ill.App.3d 292, 443 N.E.2d 1149, 67 Ill.Dec. 25 (2d Dist. 1982), which is discussed in §12.26 above. V. EVIDENTIARY ISSUES A. [12.29] Highest and Best Use Illinois Pattern Jury Instruction — Civil No. 300.84 defines the “highest and best use” of property as “that use which would give the property its highest cash market value on [the valuation date, which] may be the actual use of the property on that date or a use to which it was then adaptable and which would be anticipated with such reasonable certainty that it would enhance the market value on that date.” See the discussion in §12.1 above regarding the valuation date. Therefore, in determining whether a proposed use is acceptable as the highest and best use, (1) the land must be adaptable for the alleged use, (2) the use must be anticipated with a reasonable degree of certainty, and (3) the use must enhance the market value of the property. See, e.g., Southwestern Illinois Development Authority v. Al-Muhajirum, 348 Ill.App.3d 398, 809 N.E.2d 730, 284 Ill.Dec. 164 (5th Dist. 2004) (barring landowner’s appraisal expert when valuation opinion was based on landowner’s dreams of potential future development); Department of Transportation, State of Illinois v. Kelley, 352 Ill.App.3d 278, 815 N.E.2d 1214, 287 Ill.Dec. 411 (3d Dist. 2004) (unit rule analysis may be affected by wetland versus non-wetland portions of property). On the issue of adaptability, counsel must consider whether federal, state, or local permits will be necessary for development of the site; if so, the owners must establish that there is a reasonable probability that the permits would be issued. The owners must also establish that the development can be anticipated with a reasonable degree of certainty, which requires a showing not only that there exists a reasonable probability that necessary permits would be issued but also that a market exists for the proposed use and that trends in the area favor the use. As to



enhancement of the market value, if the proposed use would require an expenditure of money far in excess of the property’s value, obviously the proposed use is not the highest and best use. As discussed in §§12.30 – 12.32 below, numerous approaches may be taken, both offensively and defensively, in a case in which a party proposes a highest and best use different from the existing use. 1. [12.30] Evidence of Environmental Conditions Affecting Highest and Best Use Evidence of environmental conditions present on a condemned site is often introduced at trial by the condemnor to demonstrate that site development would be constrained or restricted, thereby affecting highest and best use. In the following cases, attempts were made to introduce evidence of environmental problems present on the condemned properties to limit their highest and best use: a. In Lombard Park District v. Chicago Title & Trust Co., 105 Ill.App.2d 371, 245 N.E.2d 298 (2d Dist. 1969), the plaintiff sought introduction of a United States Geological Survey map that depicted the floodplain area for the purposes of establishing that residences could not be built and building permits could not be issued for portions of the property. Although the trial court admitted the map, the appellate court reversed, finding that authority for the creation of the map was not demonstrated clearly enough for the survey to be admitted as a public document. b. In Forest Preserve District of Cook County v. Tabin, 115 Ill.App.2d 267, 253 N.E.2d 99 (1st Dist. 1969), the plaintiff introduced evidence of flood maps, boring logs, and drainage maps to demonstrate that the property value was reduced considerably because of the poor soil and drainage conditions of the property, thus reducing the number of usable lots. The appellate court found that there was no abuse of discretion in allowing the exhibits into evidence. c. In Lake County Forest Preserve District v. Frecska, 85 Ill.App.3d 610, 407 N.E.2d 137, 40 Ill.Dec. 906 (2d Dist. 1980), the plaintiff sought introduction of evidence that due to the soil composition, shape, and flooding of the site, the highest and best use would be limited to a single commercial user rather than a more intense commercial development. The trial court allowed testimony that the site had previously been used as a landfill, that the soil would be subject to compression for 20 to 30 years before settlement was complete, and that the property was partially located in the floodplain of the Des Plaines River. d. In Department of Conservation of State of Illinois v. Dorner, 192 Ill.App.3d 333, 548 N.E.2d 749, 139 Ill.Dec. 364 (1st Dist. 1989), the plaintiff’s witnesses testified to the fact that the property was located in the floodway of Salt Creek, and 7 of the 13 lots were protected wetlands pursuant to §404 of the Clean Water Act, 33 U.S.C. §1344. Therefore, the plaintiff presented a highest and best use of open space in contrast to the defendants’ theory that the highest and best use was for multifamily residential. e. In Department of Transportation v. HP/Meachum Land Limited Partnership, 245 Ill.App.3d 252, 614 N.E.2d 485, 185 Ill.Dec. 351 (2d Dist. 1993), the appellate court permitted



distinct wetland areas of a site to be valued differently than non-wetland areas. Cf. Department of Transportation, State of Illinois v. Kelley, 352 Ill.App.3d 278, 815 N.E.2d 1214, 287 Ill.Dec. 411 (3d Dist. 2004) (distinguishing HP/Meachum based on clear delineation of wetland versus non-wetland boundaries.) f. In Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 250 Ill.App.3d 665, 619 N.E.2d 1321, 189 Ill.Dec. 272 (2d Dist. 1993), evidence was presented by both parties with respect to the extent to which the subject property’s highest and best use was affected by floodplain, wetland, and unsuitable soil restraints. g. In Zeitz v. Village of Glenview, 304 Ill.App.3d 586, 710 N.E.2d 849, 238 Ill.Dec. 52 (1st Dist. 1999), evidence was presented that the presence of three wetland areas on the subject property and the fact that the subject property was entirely located within an “environmentally sensitive area” designated on the village’s zoning map had an impact on the subject property’s highest and best use. Evidence of environmental conditions also may be introduced at trial by the condemnor as a defense to a claim that damage to the remainder has been incurred. In the following cases, damages to the remainder were not considered or awarded based on evidence of environmental conditions: a. In Kiernan v. Chicago, S.F. & C.R. Co., 123 Ill. 188, 14 N.E. 18, 20 (1887), the plaintiff introduced evidence that by diverting a stream that had flowed on the landowner’s property, there was no damage to the remainder because the stream was the receptacle of all the sewage of a municipality and, by such use, had become “so befouled as to be practically worthless for stock water.” The jury awarded one dollar for diversion of the polluted stream. The ruling of the trial court on the issue of evidence of pollution was affirmed on appeal. b. In Northern Illinois Gas Co. v. Wienrank, 66 Ill.App.2d 60, 213 N.E.2d 411 (3d Dist. 1965), an easement was taken for underground gas storage purposes. The defendants attempted to admit evidence that there was an adverse condition on the property after the taking because of the possibility of gas leakage on the property. The trial court excluded the evidence, finding that, since there was no reasonable possibility of gas leakage, there was no adverse effect or danger of fire or destruction of water resources by the project on the remaining property. The appellate court affirmed the trial court’s ruling. The property owner or condemnee may be placed in a position of having to respond to the introduction of evidence of negative environmental conditions. Responses typically include (a) minimizing the effect of the evidence by the introduction of testimony or plats that depict development of the property avoiding the negative environmental conditions or (b) the introduction of evidence of the reasonable probability of securing permits to alleviate any restrictions on development.



2. [12.31] Evidence of Costs Incurred To Alleviate or Minimize Environmental Conditions

Included in any theory of highest and best use is the requirement that the use enhance the market value of the site. Analysis of the enhancement of market value often centers on how much the remedial actions will cost when adverse physical conditions are present. If the landowner presents a highest and best use theory dependent on remedial action to correct adverse environmental conditions, evidence is often solicited on cross-examination relating to the cost of the remedial action. Illinois courts allow evidence pertaining to the cost of remedial action when the door has been opened by the landowner who presents a highest and best use different from the existing use of the site. In Forest Preserve District of Cook County v. Galt, 412 Ill. 500, 107 N.E.2d 682 (1952), 121.5 acres of unimproved, vacant property in an unincorporated area of Cook County, adjacent to Lake County, were condemned for a forest preserve. Both parties conceded that the highest and best use of the property was for a residential subdivision. However, an area comprising approximately 50 acres of the property was considered a marsh. Witnesses for the landowner testified that, in determining the highest and best use of the property, they took into consideration the cost of laying out a subdivision. The forest preserve district sought to cross-examine the defendant’s witnesses on the issue of the cost of improvements necessary to make the land habitable. The trial court allowed the cross-examination pertaining to the cost of improvements. The Illinois Supreme Court affirmed, finding that evidence of the cost of necessary improvements was admissible. The court held that

in order to test the value of the opinions of experts it was competent to show the income that would be derived from property on their theory, since it appeared from the testimony that values were largely controlled by income. We see nothing in the facts of this case which make it error for the court to allow testimony as to the cost of improving the property for the sale of lots for dwelling purposes when the claims for compensation involve the sale of such land for such purpose. 107 N.E.2d at 685.

Again, in Forest Preserve District of Cook County v. Krol, 12 Ill.2d 139, 145 N.E.2d 599 (1957), the Illinois Supreme Court found evidence of costs of improvement admissible if the alleged highest and best use was different from existing site conditions. Krol involved the acquisition of a golf course by the forest preserve district. Portions of the property were subject to overflow of a drainage stream that ran across the property. The forest preserve district argued that the highest and best use of the property was for continuation as a golf course. The landowners argued that the highest and best use was for a residential subdivision. The owners were permitted to introduce a plat showing how the property could be subdivided. The forest preserve district brought out on cross-examination of the owners’ experts the costs involved in subdividing the property in accordance with the plat. The Illinois Supreme Court affirmed the introduction of evidence pertaining to the costs of improvements:



The appellants’ theory was that the highest and best use for the tract was for a subdivision. This being a question in issue, there was no error, based on the record in this case, in allowing cross-examination of their witnesses regarding the cost of improving the property for the sale of lots for dwelling purposes. . . .

. . . It being proper to examine the appellants’ witnesses as to the basis of their opinions on costs of subdividing, it was proper for the appellee to introduce evidence on its side as to such costs. 145 N.E.2d at 603.

The decision in Krol, however, was at least partially based on the fact that the landowner had introduced evidence of percolation tests conducted on the site to demonstrate the suitability of the property for septic tanks. Therefore, the trial court allowed testimony pertaining to the costs of these systems on cross-examination, and the Supreme Court affirmed the ruling. The First District has also addressed the issue of costs of improvements. In Forest Preserve District of Cook County v. Tabin, 115 Ill.App.2d 267, 253 N.E.2d 99 (1st Dist. 1969), both the forest preserve district and the landowner agreed that the highest and best use of the condemned property was for use as a residential subdivision. However, the forest preserve district contended that the soil and drainage conditions of the property seriously affected its value for a subdivision. Evidence of soil conditions, flooding, and poor drainage was introduced by the forest preserve district. The result of the evidence was the forest preserve district’s conclusion, reached on cross-examination of one of its valuation witnesses, that a developer would have to spend 35 percent more in development costs than would normally be the case in the development of other land. The landowner presented an engineer and a land planner who testified that areas of poor soils are generally used for retention lakes. In the alternative, excavation could be conducted and adequate fill material added to the site. The land planner introduced two plats depicting possible development. The forest preserve district attempted to cross-examine the engineer, the land planner, and a valuation witness, in both general and specific terms, on the costs of the remedial actions. The trial court allowed cross-examination based on the general costs of remediation but denied cross-examination based on the costs required to develop the property in accordance with the landowner’s two plats. Numerous errors were alleged on appeal concerning the introduction of evidence of costs of improvements as well as the introduction of the plats. The appellate court affirmed the rulings of the trial court, finding no abuse of discretion in the trial court’s limiting cross-examination to the general costs of improvements. Illinois courts have admitted, on cross-examination and rebuttal, evidence of costs of property improvements when the landowner presented a highest and best use that was allegedly not precluded by the existence of adverse environmental conditions. The objective of presenting remediation costs obviously is to illustrate that, at some point, the costs of remediation become so



high that the property value is no longer enhanced by the remediation efforts or that the costs of remediation do not impair a proposed use. By contrast, in Department of Transportation ex rel. People of State of Illinois v. Parr, 259 Ill.App.3d 602, 633 N.E.2d 19, 20, 198 Ill.Dec. 557 (3d Dist. 1994), the court upheld the exclusion of testimony regarding environmental waste and remediation costs:

The certified question asks whether the Illinois Department of Transportation (IDOT) may introduce alleged environmental remediation costs at eminent domain proceedings in determining the fair market value of the subject property. We answer the question in the negative because: (1) environmental remediation costs, standing alone, have no direct bearing on the valuation of condemned property; and (2) the admission of environmental remediation costs into evidence would violate the due process rights of property owners under the Illinois Environmental Protection Act. As a result, we affirm the trial court’s decision to exclude this evidence and remand this cause to the trial court for further proceedings consistent with this order.

As discussed in §12.1 above, the approach taken by the Parr court was based on former §7-119 of the Code of Civil Procedure (see now 735 ILCS 30/10-5-50), relating to admissibility of evidence, prior to its amendment in 1998. The 1998 amendment of §7-119 by P.A. 90-393 expressly allowed evidence as to “any violation of any environmental law or regulation” and the reasonable costs of rendering the property compliant “with environmental laws and regulations.” Whether the 1998 amendment to and the legislature’s subsequent lack of changes to the admissibility of evidence statute in enacting the Eminent Domain Act affect the continued viability of the Parr court’s holding has not been determined in any reported appellate court decisions as of this writing. The majority of jurisdictions permit introduction of this evidence. See, e.g., 260 North 12th Street, LLC v. State of Wisconsin Department of Transportation, 338 Wis.2d 34, 808 N.W.2d 372 (2010); Northeast Ct. Economic Alliance, Inc. v. ATC Partnership, 256 Conn. 813, 776 A.2d 1068 (2001); State of Oregon v. Hughes, 162 Or.App. 414, 986 P.2d 700, 703 (1999); State of Florida, Department of Transportation v. Finkelstein, 629 So.2d 932 (Fla.App. 1993), approved and remanded, 656 So.2d 921 (Fla. 1995); City of Olathe, Kansas v. Stott, 253 Kan. 687, 861 P.2d 1287 (1993). 3. [12.32] Highest and Best Use Dependent on Government Action In order to prove that a proposed use is feasible, counsel often will be placed in the position of establishing that there is a reasonable probability that federal, state, and local permits will be issued. The rationale for allowing evidence of reasonable probability of favorable government action is that the jury should have available to it all the facts that private parties would consider in negotiating a sale on the open market. The procedures used to introduce this evidence are similar to those used to introduce evidence of probable rezoning. See Chapter 7 of this handbook, regarding valuation of property. Procedurally, the trial judge should make an initial determination as to the sufficiency of the evidence before its presentation to the jury to ensure that only competent evidence is admitted.



Lombard Park District v. Chicago Title & Trust Co., 103 Ill.App.2d 1, 242 N.E.2d 440, 445 (2d Dist. 1968); Lake County Forest Preserve District v. Petersen, 93 Ill.App.3d 731, 417 N.E.2d 862, 49 Ill.Dec. 172 (2d Dist. 1981). However, a formal hearing may not be the only method by which the evidence may be presented to a trial judge for an initial determination of competency. In Forest Preserve District of DuPage County v. Brookwood Land Venture, 199 Ill.App.3d 973, 557 N.E.2d 980, 985, 146 Ill.Dec. 38 (2d Dist. 1990), the appellate court found that an offer of proof in which the trial judge “adequately passed upon the competence of the instant evidence” was sufficient. If the movant is successful in establishing the proper foundation for a reasonable probability issue, the evidence of use dependent on government action can then be presented to the jury for their consideration. If not, evidence of the use dependent on government action will not be allowed by the trial court. See Lake County Forest Preserve District v. Bank & Trust Company of Arlington Heights, 106 Ill.App.3d 856, 436 N.E.2d 237, 62 Ill.Dec. 487 (2d Dist. 1982), in which the trial court ruled and the appellate court affirmed that reasonable probability of rezoning and annexation had not been established, thereby precluding the landowner from presenting a commercial highest and best use to the jury. Several Illinois courts have discussed the substantive requirements for establishing a proper foundation for evidence of reasonable probability of obtaining governmental or other permits. In Petersen, supra, the defendant argued that the highest and best use of the condemned parcel was for a sanitary landfill. In furtherance of its position, the defendant filed a motion in limine on the reasonable probability of obtaining a permit from the IEPA for operating a landfill on the site. The court heard the testimony of engineers and land planners on the issue of the reasonable probability of obtaining an IEPA permit but denied the defendant’s motion to admit valuation testimony based on the reasonable probability of obtaining an IEPA permit. On appeal, the appellate court reversed the trial court, holding:

Where property is adaptable but not presently available for its most profitable use due to governmental restrictions, our courts have held that it is permissible to consider that use in determining just compensation as long as there exists a reasonable probability of obtaining legislative or administrative relief in the near future. This rule has been applied most frequently in cases involving potential rezoning . . . although it also has been applied to the probability of obtaining other governmental action which would enhance the market value of the condemned property. [Citations omitted.] 417 N.E.2d at 864.

Regarding the standard for admission, the appellate court said:

In the final analysis the question of the trial court’s role in initially determining whether a sufficient foundation has been laid for the evidence to be considered by the jury is thus whether it is material, relevant, and competent for that purpose. In making the preliminary determination of whether there is sufficient evidence of a reasonable probability an EPA permit would be granted the record must affirmatively show sufficient evidence of factors from which a jury could conclude that there is a reasonable probability that the permit would issue and that its



issuance would enhance the market value of the property. . . . If the evidence falls short, as a matter of law, of showing any reasonable probability of the favorable action by the body authorized to act within the reasonably near future, the court shall exclude the evidence. 417 N.E.2d at 865.

The Petersen court extended the reasonable probability doctrine to the probability of obtaining an IEPA permit. See also Department of Transportation v. Smith, 100 Ill.App.3d 814, 427 N.E.2d 383, 56 Ill.Dec. 303 (5th Dist. 1981), and Brookwood Land Venture, supra, both of which involve the criteria for establishing a reasonable probability in the context of the reasonable probability of procuring access to the condemned sites. These same criteria may be applicable to those used in the context of environmentally related permits or government action. The likelihood of obtaining permits for development in wetlands was discussed in Department of Transportation v. LaSalle National Bank, 251 Ill.App.3d 901, 623 N.E.2d 390, 191 Ill.Dec. 145 (2d Dist. 1993). Caselaw has established that the following procedures should be used when a highest and best use argument is dependent on the issuance of a permit or some other type of government action: a. A motion in limine should be presented to the court on the issue of the reasonable probability of obtaining relief from the government or of obtaining the necessary permits. Petersen, supra, 417 N.E.2d at 865; Smith, supra, 427 N.E.2d at 386. b. Counsel should be prepared to present evidence that is material, relevant, and competent on the issue of the reasonable probability of obtaining the necessary relief. Petersen, supra, 417 N.E.2d at 866; Lombard Park District v. Chicago Title & Trust Co., 103 Ill.App.2d 1, 242 N.E.2d 440 (2d Dist. 1968); Bank & Trust Company of Arlington Heights, supra. A witness may not be offered solely to render an expert opinion as to whether rezoning will be granted. Forest Preserve District of DuPage County v. Kelley, 69 Ill.App.3d 309, 387 N.E.2d 368, 377, 25 Ill.Dec. 712 (1979). A valuation expert may, as a basis for the expert’s opinion, explain the reasons that rezoning is reasonably probable. Lombard Park District, supra, 242 N.E.2d at 444. c. Counsel must establish that the permit or action would be attainable in the foreseeable future. Petersen, supra, 417 N.E.2d at 866; Lombard Park District, supra, 242 N.E.2d at 444; Smith, supra, 427 N.E.2d at 385. d. Counsel should establish that the permit or government action will enhance the market value of the property. See Petersen, supra, 417 N.E.2d at 865 – 866, in which the court stated: “The landowner presented evidence of the need for a sanitary landfill in Lake County, and the plaintiff did not controvert that evidence. We conclude that potential value enhancement was demonstrated, and that the foundation proof did not fail in that regard.” See also Lombard Park District, supra, 242 N.E.2d at 444; Bank & Trust Company of Arlington Height, supra, 436 N.E.2d at 241, in which valuation testimony was presented in preliminary hearings. e. If the movant is successful in establishing the proper foundation for a reasonable probability issue, the evidence of that probability and the use dependent on government action can then be presented to the jury for its consideration. If not, evidence of the use dependent on



government action will not be admitted by the trial court. See Bank & Trust Company of Arlington Heights, supra, 436 N.E.2d at 241. B. [12.33] Effect of Environmental Conditions on Use of Comparable Sales; General

Rules of Comparable-Sales Approach As discussed in §7.20 of this handbook, the market approach is the most common approach used to value property in condemnation cases. The market approach is based on the use of comparable sales to establish the fair market value of the condemned property. A question arises as to how to apply the comparable-sales approach if a condition exists on the subject property that tends to limit its development or decrease its value. For instance, if the property condemned is listed as a site under CERCLA or is located in a floodplain, what types of comparable sales should be used, if any? As a general rule, properties submitted to the court as comparable sales must be similar. As to the extent of similarity, the Illinois Supreme Court stated in City of Evanston v. Piotrowicz, 20 Ill.2d 512, 170 N.E.2d 569, 575 (1960):

[N]o fixed or general rule has or could be laid down which governs the degree of similarity that must exist between the properties sold and that condemned to make evidence of the sale or sales admissible; rather, the admissibility of such evidence must in each instance be determined by the trial judge within the proper limits of his discretion. . . . This court, moreover, has recognized that “similar” does not mean “identical,” but means having a resemblance, and that property may be similar for purposes of fruitful comparison, though each possesses various points of difference. . . . Wherever there is a reasonable basis for comparison between the property sold and that being condemned, evidence of the sale is not incompetent, and the dissimilarities between the properties, which are declared to the jury, affect the weight and value of the testimony rather than its competency. [Citations omitted.]

The Piotrowicz standard for admissibility of comparable sales grants the trial court wide discretion. When a condemned property contains physical characteristics such as wetlands, flooding, etc., that may limit development, questions arise as to whether to use comparable sales and, if so, what type of comparable sales to use. Several approaches exist. First, sales of properties with similar characteristics can be used as a basis of comparison. Second, in certain circumstances, costs to place the properties in the same or similar condition can be estimated and added to or subtracted from the comparable sale’s selling price. Third, sales can be used that do not have similar conditions, and the jury is left to compare and weigh the relative strengths and weaknesses of the comparable sales admitted. 1. [12.34] Sales of Properties Equally Affected by Environmental Conditions The use of comparable sales that have similar environmental conditions is clearly the safest way to ensure admissibility. In Department of Conservation of State of Illinois v. Dorner, 192



Ill.App.3d 333, 548 N.E.2d 749, 139 Ill.Dec. 364 (1st Dist. 1989), the appellate court addressed the issue of the use of comparable negative conditions. Dorner involved the acquisition of 13 lots located in a subdivision that had not been improved with streets, curbs, sidewalks, water, sewer, storm drainage, power, or utilities. All 13 lots condemned were located in the floodway of Salt Creek. In addition, 7 of the 13 lots were protected wetlands pursuant to §404 of the Clean Water Act, 33 U.S.C. §1344. Permits from both the Division of Water Resources of the Illinois Department of Transportation (IDOT) and the United States Army Corps of Engineers would have been required before development of the lots containing wetlands. The State of Illinois sought to introduce as comparable sales the recent sales of other lots within the same subdivision to a conservation group called “Save the Prairie.” The trial court admitted the sales as comparable, and the appellate court affirmed, holding that “the Wolf Road Prairie sales met the criteria for comparable sales. The land was physically identical to the subject lots.” 548 N.E.2d at 752. The trial court denied admission of sales of lots located in two other developed subdivisions. The appellate court affirmed, finding:

[T]he sales in Woodland View and Mayfair were of improved lots either developed or buildable, and approximately twice the size of the Wolf Road Prairie lots, meeting minimum size requirements for building. . . . In contrast, the Wolf Road Prairie lots were unimproved, undeveloped, and did not meet minimum size requirements. Moreover, the subject lots lie in the flood plain of the Salt Creek. 548 N.E.2d at 754.

See also Lake County Forest Preserve District v. Reliance Standard Life Insurance Co., 29 Ill.App.3d 145, 329 N.E.2d 344, 349 (2d Dist. 1975), in which the trial court permitted and the appellate court affirmed the use of comparable sales with similar flooding problems, pointing out the similarities between the condemned property and the two other properties introduced as comparable sales:

[T]hey had identical drainage, river frontage, were partially located in the flood plain, and none of the three were subdivided or had any buildings, sewer or water.

2. [12.35] Use of Estimated Costs To Place Properties on Equal Footing In some instances, a property recently sold and similar to the condemned property, except for adverse environmental conditions, may be the most appropriate sale to put before the jury as comparable. In such a case, the costs to place the allegedly comparable-sale property in the same or similar condition as the condemned property may be not only appropriate but required for a ruling by the trial court that a specific property is comparable. Forest Preserve District of DuPage County, Illinois v. Harris Trust & Savings Bank, 108 Ill.App.2d 65, 247 N.E.2d 188 (2d Dist. 1969). In Harris Trust, the trial court determined that properties recently sold in the area of the subject property could not be considered comparable sales and thus admissible as independent evidence of value without some evidence of the cost of providing sewer and water services to the properties. The court found that a substantial discrepancy existed between the alleged comparable



sales and the subject property because the subject property was capable of supporting storm and sanitary sewage systems whereas the alleged comparable sales were not. The trial court found that the availability of storm and sewer systems was “the most significant single factor in the area contributing to the value of land.” 247 N.E.2d at 193. The Second District affirmed the trial court’s ruling, holding:

While it is not normally the burden of such party to offer the evidence of dissimilarities, but the privilege of the other party, the trial court was within the proper exercise of its discretion in not permitting evidence of the sales in the first place without the accompanying evidence of the cost of compensating for this substantial dissimilarity which existed between certain of the allegedly comparable properties and the subject property. Id.

The court held that detailed engineering costs were not necessary and that rough estimates of the costs could be used. The court concluded:

The plaintiff should hardly complain of the requirement imposed by the trial court in this case as due to the particular attribute of the subject property; the alternative of showing the differing costs of sewer and water facilities is the exclusion of the other sales as not being sufficiently similar to offer independent evidence of the value of the subject property. Id.

However, the approach of presenting evidence of costs to place an alleged comparable sale in the same or similar condition is not always allowed. In Department of Conservation v. Kyes, 57 Ill.App.3d 563, 373 N.E.2d 304, 311 – 312, 15 Ill.Dec. 34 (2d Dist. 1978), the appellate court held:

The State has not cited, and we are not aware of any case which requires the witnesses to testify to specific “adjustments” for all the differences between the sale offered as a comparable and the subject property. Indeed, we believe that testimony applying dollar amounts to all of the differences and then adding or subtracting would be extremely likely to confuse or mislead the jury. Testimony concerning the general differences is, however, appropriate, and it was received in this case.

The Second District followed Kyes in Department of Public Works & Buildings v. Byford, 59 Ill.App.3d 844, 376 N.E.2d 358, 17 Ill.Dec. 359 (2d Dist. 1978). In Byford, the alleged comparable-sale properties again had no immediate access to sewer and water, but the condemned property did. However, the trial court found that the most significant factor affecting land value was not the availability of sewer and water services. Citing Kyes, the appellate court held:

While there are some differences between the subject property and those to which it was compared the similarities are far more apparent. The Owners’ emphasis of the single feature of the availability of the utilities does not, under the circumstances of this case, require exclusion of the comparable sales, but any dissimilarity in that



regard would affect the weight and value of the evidence rather than its admissibility. 376 N.E.2d at 362.

The court concluded that the sales were properly entered into evidence. “The jury had evidence before it which permitted it to consider any dissimilarities as well as likenesses between the subject property and the comparable sales to which the Owners object and we find they were properly admitted in evidence.” Id. The Byford court, however, did not overrule Harris Trust, supra, because it was limited to the circumstances of the case. Therefore, consideration should be given as to whether there are substantial discrepancies between the condemned site and sales being introduced as comparable. If a factor exists that is the most significant single factor in the area contributing to the value of land, evidence of costs may be required in order that the sale is deemed as comparable and admitted as independent evidence of value. 3. [12.36] Comparable Sales with Dissimilar Environmental Conditions Complete similarity of environmental conditions is not necessary for a sale to be introduced into evidence as a comparable sale. In Lake County Forest Preserve District v. Frecska, 85 Ill.App.3d 610, 407 N.E.2d 137, 40 Ill.Dec. 906 (2d Dist. 1980), the plaintiff condemned 6 acres of an 11-acre parcel located in Lake County. Of the 6 acres taken, 3.67 acres were located in the floodplain of the Des Plaines River. In addition, a substantial portion of the 6 acres had been used as a sanitary landfill. The trial court admitted a comparable sale that did not contain a landfill. The Second District affirmed, holding, “In any event, the differences between the two properties with regard to the landfill were adequately pointed out to the jury and, as such, they affect the weight and value of the testimony rather than its competency.” 407 N.E.2d at 141. See also Lake County Forest Preserve District v. Reliance Standard Life Insurance Co., 29 Ill.App.3d 145, 329 N.E.2d 344 (2d Dist. 1975). Although a property that does not contain similar negative environmental conditions may be used as a comparable sale, if there is evidence of contamination on the subject property, a different result might be reached. In Frecska, supra, the appellate court found that a property that did not contain a landfill could be used to value a property with a landfill; however, had there been evidence admitted by the trial court that the landfill had the potential to cause pollution, the appellate court may have reached a different conclusion as to comparability:

Although the existence of the landfill might affect the suitability for construction on the subject property, there is no evidence of any substantial pollution potential as is urged by the plaintiff. Joseph Koenen could not give an opinion as to whether the landfill was polluting the Des Plaines River or whether it would do so in the future. Additionally, plaintiff has misconstrued the statements in an Environmental Protection Agency letter which analyzed the pollution potential of the site. The letter



indicated that, based on the information supplied to the agency by Lake County, there is very little potential hazard of pollution. 407 N.E.2d at 141.

A question arises as to how the appellate court would have ruled had evidence of pollution potential been proved at the trial court level. C. [12.37] Admission of Substandard or Illegal Condition Evidence concerning the illegal condition of a property subject to a condemnation action is admissible under 735 ILCS 30/10-5-50. As discussed in §§12.1 and 12.31 above, the admissibility of evidence provisions of former §7-119 of the Code of Civil Procedure (predecessor to §10-5-50) were amended in 1998 to make express reference to environmental violations of compliance. This language added in 1998 remained in the statute with the enactment of §10-5-50 of the Eminent Domain Act, which states:

Evidence is admissible as to: (1) any benefit to the landowner that will result from the public improvement for which the eminent domain proceedings were instituted; (2) any unsafe, unsanitary, substandard, or other illegal condition, use, or occupancy of the property, including any violation of any environmental law or regulation; (3) the effect of such condition on income from or the fair market value of the property; and (4) the reasonable cost of causing the property to be placed in a legal condition, use, or occupancy, including compliance with environmental laws and regulations. Such evidence is admissible notwithstanding the absence of any official action taken to require the correction or abatement of the illegal condition, use, or occupancy. [Emphasis added.] 735 ILCS 30/10-5-50.

Two Illinois courts interpreted former §7-119 in its pre-1998 amendment form as it pertains to illegal conditions of a condemned site. In Illinois State Toll Highway Authority v. West Suburban Bank, 208 Ill.App.3d 923, 567 N.E.2d 730, 153 Ill.Dec. 772 (2d Dist. 1991), the trial court instructed the jury to disregard testimony elicited during the trial as to the defendant’s alleged illegal use of a right-of-way owned by the state. The appellate court reversed the trial court on other grounds but affirmed the ruling pertaining to the exclusion of evidence of the alleged illegal use:

In the case at bar, section 7-119 would therefore only apply if there was evidence [that the landowner] used his own property illegally before the take. Since there was no such evidence, section 7-119 is not applicable. 567 N.E.2d at 734.

The plaintiff also argued that the illegal use issue was relevant to ascertaining damages to the remainder because evidence of the illegal use of the adjoining right-of-way indicated that the fair market value of the land before the taking was lower than the defendants suggested since they did not own nor were they legally entitled to use the right-of-way. The appellate court found that the plaintiff had not demonstrated a relationship between the illegal use and the fair cash market value of the property. “Upon retrial, such evidence should not be considered by the jury unless



the State shows a connection between the illegal encroachments and the fair-market value of the land prior to the taking.” 567 N.E.2d at 735. West Suburban Bank suggests that, in order for evidence of illegal use to be admissible, the condemnor must prove that the illegal use affects the market value of the property before the taking.

In Department of Transportation ex rel. People of State of Illinois v. Parr, 259 Ill.App.3d 602, 633 N.E.2d 19, 22, 198 Ill.Dec. 557 (3d Dist. 1994), the appellate court concluded “that section 7-119 of the Eminent Domain Act does not permit the admission of environmental remediation costs at an eminent domain proceeding unless the trial court has found the presence of an underlying illegal condition to justify such costs.” (Former §7-119 in its pre-1998 amendment form, which Parr court construed, did not contain statutory direction to admit evidence of “any violation of any environmental law or regulation” and of cost of “compliance with environmental laws and regulations.”) No such illegal condition was apparently proved by the condemnor. The appellate court also raised questions concerning the introduction of this evidence and a litigant’s procedural due-process rights under the Environmental Protection Act. As of this writing, no reported appellate court decision has addressed the viability of Parr in light of the 1998 amendment. D. [12.38] Admission of Demonstrative Evidence in Proving Environmental Conditions Demonstrative evidence of many types is generally used by trial counsel in eminent domain litigation if environmental conditions such as wetlands, flooding, drainage, or soil-bearing capacity are at issue. In many cases, physical characteristics of the property limit development potential. These limitations are typically demonstrated by plats and plans, photographs, topographic and contour maps, floodplain maps, soil conservation and boring maps, drawings, and diagrams. Many of these items can be introduced into evidence through authentication and verification by an expert or through judicial notice of the authenticity of public records as an exception to the hearsay rule. As was held by the Illinois Supreme Court in 1913,

[p]lats, photographs, drawings, and diagrams which illustrate the subject-matter of testimony are frequently received in evidence for the purpose of showing a particular situation explaining the testimony or enabling the jury to apply the testimony more intelligently to the facts shown [and] their admission was largely within the discretion of the court. Smith v. Sanitary Dist. of Chicago, 260 Ill. 453, 103 N.E. 254, 257 (1913).

The overriding considerations in ruling on demonstrative evidence are relevancy and fairness. The question of admissibility of this evidence is usually a matter of the trial court’s discretion, subject to review for abuse of this discretion. Lake County Forest Preserve District v. Vernon Hills Development Corp., 85 Ill.App.3d 241, 406 N.E.2d 611, 615, 40 Ill.Dec. 605 (2d Dist. 1980). Sections 12.39 – 12.44 below provide guidelines for the admission of several types of demonstrative evidence in cases involving special environmental conditions.



1. [12.39] Plats and Plans The admissibility of subdivision plats, development plans, concept sketches, and drawings depends in part on the reason for offering the evidence and the stage of development or planning of the subject property. In almost all reported cases, the appellate courts have affirmed decisions regarding the admission of plats, plans, concept sketches, or drawings as being within the trial court’s discretion. But see Park District of Highland Park v. LaSalle National Bank, 36 Ill.App.3d 146, 343 N.E.2d 186 (2d Dist. 1976). Terminology in cases in which the courts discuss this type of evidence is inconsistent in that the term “plat” is used interchangeably with “map” and the term “development plans” is used indiscriminately for other types of plans. However, terminology aside, §§12.40 and 12.41 below provide some general guidelines as to the admissibility of plats and plans. a. [12.40] Prefiling Plans for Development Plans made before the filing of the petition to condemn and offered to show the adaptability of the site for a particular purpose are more likely to be deemed admissible by the trial court. In the following cases, trial courts have found these plans admissible, and the rulings have been affirmed on appeal. In Chicago & E.R. Co. v. Blake, 116 Ill. 163, 4 N.E. 488, 491 (1886), the Supreme Court held:

Whether evidence of [plans to construct a specific structure] is proper or improper depends entirely upon the purpose for which it is offered and to which it is limited by the court. If the object of such evidence is to enhance the damages by showing such a structure would be a profitable investment, the testimony would clearly be inadmissible. If on the other hand, it is offered merely as an illustration of one of the uses to which the property is adapted[,] or, in other words, by way of showing the capabilities of the property, and it is expressly limited by the court to such object, as was the case here, . . . there will be no error in admitting it. The practice, however, of introducing such evidence should not be encouraged, as there is generally more or less danger of its being misunderstood by the jury. [Emphasis added.]

In Blake, the court concluded that it was not prejudicial error to admit plans to build a structure that the landowner had contemplated building for a number of years before the condemnation action. In a second Illinois Supreme Court case, Department of Public Works & Buildings v. Lambert, 411 Ill. 183, 103 N.E.2d 356 (1952), the issue of prefiling plans also arose. Lambert involved drawings made by the landowner of motel units contemplated years before the property was the subject of a condemnation action. After the condemnation case was filed, the landowner had an architect draw a plat in conformance with the landowner’s earlier drawings. Both the drawing of the landowner and the architect’s plat were offered in evidence. The prefiling



drawings were admitted into evidence; however, the admission of the post-filing plat was denied. On appeal, the court held:

In the case at bar appellant and various witnesses testified as to the adaptability of the premises for use as a tavern, restaurant, motel and trailer court, a topographic map prepared by a civil engineer was admitted as one of appellants’ exhibits, and appellant Lambert’s own drawings and plans of contemplated improvements were admitted in evidence. It was within the discretion of the lower court as to whether the architect’s drawings should be admitted and there was no error or abuse of that discretion in their refusal. 103 N.E.2d at 361.

In Department of Conservation of State of Illinois v. Kyes, 57 Ill.App.3d 563, 373 N.E.2d 304, 15 Ill.Dec. 34 (2d Dist. 1978), the Second District considered the admission of plans in the context of plans for a carriage and harness museum and antique shop that had been drawn before the landowner learned of the state’s intent to acquire the site. The defendant-landowner sought admission of the plans into evidence for the purpose of proving the adaptability of the property to the particular use. The state argued that the plans were introduced not for that purpose but to show the profitability of the proposed business. The court held that, based on the trial testimony, the plans were introduced for the purpose of showing the adaptability of the property as well as to show the good faith of the landowner in the purchase of the property and her commitment toward carrying out the proposed project. 373 N.E.2d at 310. In Lake County Forest Preserve District v. Frecska, 85 Ill.App.3d 610, 407 N.E.2d 137, 40 Ill.Dec. 906 (2d Dist. 1980), the trial court found that concept sketches depicting possible phases of development of the site that had been prepared two years before the filing of the condemnation petition were admissible. The ruling was affirmed by the appellate court, which held:

If . . . the plan is offered merely as an illustration of one of the uses to which the property is adapted, or, in other words, by way of showing the capabilities of the property, and it is expressly limited by the court to such object, there would be no error in admitting it. 407 N.E.2d at 143 – 144.

The Frecska court, however, was also influenced by the fact that the plaintiff’s theory of highest and best use was different from the highest and best use articulated by the defendant and by the fact that the purpose of offering the evidence was not to enhance damages in any way. These cases tend to indicate that prefiling plans are likely to be admitted for the purpose of showing the adaptability of the subject property. b. [12.41] Post-Filing Plats or Development Plans The admissibility of plats and plans developed after condemnation proceedings have begun also depends on the reason for introducing the evidence. Perhaps courts are more suspicious of post-filing plans and plats because of the obvious motive to enhance compensation. In the following cases, the courts have denied the introduction of post-filing plats.



In Sexton v. Union Stock Yard & Transit Co., 200 Ill. 244, 65 N.E. 638 (1902), the Illinois Supreme Court addressed the issue of admitting “development plats” into evidence. The court found that, even if the purpose of offering a proposed plat into evidence is to demonstrate the adaptability of the land for building in the future, the plat or plan is not necessarily admissible. The court held:

The map or plat sought to be introduced in the case at bar was not of any building or structure that the appellants had contemplated erecting, but a mere plat or plan of a possible, and largely imaginary, development of the tract. Oral testimony had been received as to the adaptability of the property for such use, and we think the court properly declined to admit the plat or plans in evidence. 65 N.E. at 640.

Again, in Forest Preserve Dist. of Cook County v. Wallace, 299 Ill. 476, 132 N.E. 444 (1921), the Illinois Supreme Court addressed the admissibility of plats and found that the trial court did not err in excluding a plat for a proposed subdivision when the plat was not of record, the land was not surveyed into lots according to the plat, and there was no certainty that it would be or become an actual plat of that land. The court held that it was not even shown that a plat was contemplated or made before suit was brought. 132 N.E. at 447 – 448. In numerous cases, the Second District also has addressed the issue of the admissibility of post-filing plats. In two cases in particular, the court followed the rationale articulated by the Illinois Supreme Court in Wallace, supra, that the relevant issues are whether (1) the plat is of record, (2) the land had been surveyed into lots, (3) evidence exists on whether the property would be surveyed or become an official map, and (4) the plat was prepared in anticipation of trial. See Park District of Highland Park v. LaSalle National Bank, 36 Ill.App.3d 146, 343 N.E.2d 186 (2d Dist. 1976); Department of Conservation of State of Illinois v. First National Bank of Lake Forest, 36 Ill.App.3d 495, 344 N.E.2d 11 (2d Dist. 1976). In LaSalle National Bank supra, the appellate court found that, since the subject property had not been surveyed into lots and the plat had been created one week before trial and never recorded, the plat was improperly admitted into evidence. The court further based its decision on the fact that the plat had been introduced for the purpose of enhancing damages. 343 N.E.2d at 189. In First National Bank of Lake Forest, supra, the defendant attempted to combat the state’s position that large portions of the subject property could not be developed by presenting a subdivision feasibility study designed for the purpose of showing that the property could be developed into one-acre single-family residences. The trial court refused to admit the plat, and the Second District affirmed, citing, inter alia, Wallace, supra, Sexton, supra, and Department of Public Works & Buildings v. Lambert, 411 Ill. 183, 103 N.E.2d 356 (1952), for the propositions that the plat was not of record, the land had not been surveyed into lots, there was no evidence that the property would be surveyed or become an official plat, and the plat was prepared for trial. 344 N.E.2d at 15. Subsequently, the Second District has not strictly followed the standards set forth in Wallace, supra; however, the court has arrived at the same result. See Department of Conservation v.



Aspegren Financial Corp., 47 Ill.App.3d 118, 361 N.E.2d 635, 5 Ill.Dec. 312 (2d Dist. 1977), aff’d, 72 Ill.2d 302 (1978); Lake County Forest Preserve District v. Vernon Hills Development Corp., 85 Ill.App.3d 241, 406 N.E.2d 611, 40 Ill.Dec. 605 (2d Dist. 1980). In Aspegren Financial, the appellate court held that if the purpose of the introduction of a proposed development plan is to show the distinctive characteristics of the land that are intended to be exploited, making the property more valuable than adjacent land, the plan is properly denied. The court held: “We think it would be farfetched to say that the defendant’s plans — which were only a preliminary concept — should be considered as a basis for establishing a unique value in the condemned land.” 361 N.E.2d at 641. In Vernon Hills Development, supra, the trial court refused to admit drawings of a proposed development prepared by a land planner in anticipation of trial on the basis that they were purely speculative. The Second District affirmed, holding:

In this case, it was not an abuse of discretion for the trial court to refuse to admit these drawings which were aimed particularly at a possible development of the land, when the exhibits were not relied upon by the Owner’s appraisers in reaching their opinions of value and when the testimony was in dispute as to whether annexation, sewer, water and development possibilities were available to permit the development of the land in this manner. 406 N.E.2d at 615.

Interestingly, the appellate court expressly stated, in dicta:

There is dicta in Aspegren (47 Ill.App.3d at 130, 5 Ill.Dec. 312, 361 N.E.2d 635) that may be read to infer that development plans may not be introduced unless in compliance with rules governing the introduction of plats (i.e. (1) of record, (2) surveyed into lots according to the plat, (3) certain to become an official plat, and (4) not prepared for trial. See Forest Preserve Dist. v. Wallace, 299 Ill. 476, 485, 132 N.E. 444 (1921); Department of Conservation v. First Nat’l Bk., 36 Ill.App.3d 495, 499, 344 N.E.2d 11 (1976).) We did not and do not intend that all demonstrative exhibits be required to comply with the requirements applicable to plats in order to be admissible in every case. 406 N.E.2d at 615 n.1.

Therefore, it is unclear in the Second District whether the standards referred to in Wallace will be applied to all demonstrative evidence. The First District used a different approach and therefore came to a different conclusion in both Forest Preserve District of Cook County v. Tabin, 115 Ill.App.2d 267, 253 N.E.2d 99 (1st Dist. 1969), and Forest Preserve District of Cook County v. South Holland Trust & Savings Bank, 38 Ill.App.3d 873, 349 N.E.2d 689 (1st Dist. 1976). In Tabin, the trial court held that multicolored plats depicting lots, lakes, streets, cul-de-sacs, areas of weak soil, a riding stable, and picnic areas were properly admitted into evidence by the trial court on the basis that they aided the jury in determination of the facts. The First District affirmed and held:

All of the data shown by the colored exhibits were matters to be taken into consideration by the jury in a case of this nature. We do not see that they did more



than explain testimony of a somewhat technical nature and assist the jury in its determination of the facts. The court did not abuse its discretion in allowing the exhibits into evidence. 253 N.E.2d at 107, quoting Department of Public Works & Buildings v. Chicago Title & Trust Co., 408 Ill. 41, 95 N.E.2d 903, 909 (1950).

In South Holland, supra, the court held that a plat depicting a planned unit development was properly admitted into evidence to demonstrate the “departure from the old grid system of development.” 349 N.E.2d at 694. The difference in approach can best be understood by the cases cited as authority in Tabin and South Holland, which appear to be based on Smith v. Sanitary Dist. of Chicago, 260 Ill. 453, 103 N.E. 254 (1913), and Chicago Title & Trust, supra. In Smith, the Illinois Supreme Court reviewed the admissibility of “[p]lats and maps showing the contours of the land” and held:

Plats, photographs, drawings and diagrams which illustrate the subject-matter of testimony [may be] received in evidence for the purpose of showing a particular situation explaining the testimony or enabling the jury to apply the testimony more intelligently to the facts shown. . . . [T]heir admission was largely within the discretion of the court. 103 N.E. at 257.

Although the Supreme Court in Smith referred to “plats,” it qualified its language by adding “showing the contours of the land.” Id. No plats in the sense of “subdivision plats” were ever at issue. In Chicago Title & Trust, supra, the disputed evidence consisted of “three contour maps which had been colored in certain areas with crayons.” 95 N.E.2d at 909. The trial court admitted the evidence, and the Illinois Supreme Court affirmed, based on the rationale articulated in Smith: “We do not see that they did more than explain testimony of a somewhat technical nature and assist the jury in its determination of the facts.” Id. Neither Smith nor Chicago Title & Trust, cited by the First District in Tabin, supra, and South Holland, supra, involved the admissibility of subdivision plats; rather, they involved contour maps, exhibits much less likely to enhance compensation directly. The result in Tabin and South Holland may have been different had the appellate court made a distinction between contour maps or plats and subdivision plats and focused on the standards of Wallace, supra, for plats rather than on the standards of Chicago Title & Trust for contour maps. 2. [12.42] Photographs To be admissible, a photograph must have a tendency to prove an issue in the case or depict facts relevant to a particular issue. Lake County Forest Preserve District v. Vernon Hills Development Corp., 85 Ill.App.3d 241, 406 N.E.2d 611, 614, 40 Ill.Dec. 605 (2d Dist. 1980). In addition to establishing relevancy, a proper foundation must be laid before the admission of a photograph into evidence. Forest Preserve District of DuPage County, Illinois v. Harris Trust & Savings Bank, 108 Ill.App.2d 65, 247 N.E.2d 188 (2d Dist. 1969). Michael H. Graham, CLEARY



AND GRAHAM’S HANDBOOK OF ILLINOIS EVIDENCE §401.8 (10th ed. 2010), quoting Kooyumjian v. Stevens, 10 Ill.App.2d 378, 135 N.E.2d 146, 151 (1st Dist. 1956), states:

A sufficient foundation is laid for a still photograph, a motion picture, or a videotape by testimony of any person with personal knowledge of the photographed object at a time relevant to the issues that the photograph is a fair and accurate representation of the object at that time; the photographer is not required [to authenticate]. . . . “The witness need not be the photographer, nor need he know anything of the time or condition of the taking, but he must have personal knowledge of the scene or object in question and testify that [it] is correctly portrayed by the photograph.”. . . Exclusion is proper in the absence of evidence that the object depicted in a photograph taken at the later date was then in the same condition as it was at the time relevant to the issues. [Emphasis in original.] [Citations omitted.]

The standards for introduction of photographs into evidence are set forth in Vernon Hills, supra. In Vernon Hills, the forest preserve district sought to acquire 65.8 acres of property in unincorporated Lake County. The property was located in the floodplain of the Des Plaines River. The forest preserve district introduced an aerial photograph of the property taken after the valuation date, depicting the property in a flooded condition. The owner argued that, since the photograph depicted the property in a flooded condition after the valuation date, it was irrelevant as to the value of the property on the valuation date. The appellate court held:

The mere fact that the photograph was taken after the valuation date does not make it inadmissible in a condemnation case. . . . A necessary inquiry is whether the photographs of land to be taken in a condemnation suit accurately portray the conditions that the land was subject to prior to the valuation date. While photographs of the appearance and condition of land or other inanimate objects taken after a material change in the appearance and condition are generally inadmissible, there is no requirement that the situation or condition must be precisely the same. “It is sufficient if the condition is substantially unchanged, or if the things sought to be shown by the photograph remain truthfully represented or if the photograph is satisfactorily shown to be such an accurate representation.” [Citation omitted.] 406 N.E.2d at 614, quoting Casson v. Nash, 54 Ill.App.3d 783, 370 N.E.2d 564, 573 – 574, 12 Ill.Dec. 760 (1st Dist. 1977), aff’d in part, rev’d in part, 74 Ill.2d 164 (1978).

Because there was no change in the topography or other aspects of the site from the date of the photograph and the valuation date and there was sufficient testimony that the property did, in fact, periodically flood, the photograph was properly admitted. “The admissibility of photographs is within the discretion of the trial court and the reviewing court will not reverse unless under the circumstances presented there was an abuse of discretion.” 406 N.E.2d at 614. The appellate court found no such abuse of discretion. See also Illinois State Toll Highway Authority v. Grand Mandarin Restaurant, Inc., 189 Ill.App.3d 355, 544 N.E.2d 1145, 136 Ill.Dec. 370 (2d Dist. 1989), in which the trial court refused to admit a videotape of the condemned property because



the condition of the property on the date of the video was materially different than it was on the valuation date. The decision was affirmed on appeal. In addition, and as was noted in Department of Public Works & Buildings v. Chicago Title & Trust Co., 408 Ill. 41, 95 N.E.2d 903 (1950), in order to be admissible, the photographic evidence must aid the jury in understanding the facts of the case. The Illinois Supreme Court in Chicago Title & Trust found:

[S]ince the jurors had seen the terrain, the aerial photographs would add nothing to the jurors’ own view of the premises. While such exhibits might properly have been admitted under the rule of [Smith v. Sanitary Dist. of Chicago, 260 Ill. 453, 103 N.E. 254 (1913)], it was still a matter within the discretion of the court, and its failure to do so is not such an error as to warrant reversal of the judgment. 95 N.E.2d at 909.

3. [12.43] Contour Maps and Wetland Delineations The admission of contour and topographic maps, like other forms of demonstrative evidence, requires an appropriate foundation and proof that they are relevant and material to the issues in the case. The admission of contour and topographic maps also depends in part on the extent of extrapolation used in preparing the maps. If elevations or contours of the property are determined by use of a document otherwise admissible under the public-records exception to the hearsay rule, the contour map will generally be admitted. See Lake County Forest Preserve District v. Larsen, 55 Ill.App.3d 783, 371 N.E.2d 306, 13 Ill.Dec. 589 (2d Dist. 1977). In Larsen, the forest preserve district sought introduction of a topographic contour map overlay prepared by the Soil Conservation Service of the United States Department of Agriculture. The trial court admitted the overlay and underlying photograph into evidence, stating that the floodplain topographic map met the criteria for admission as a public record. See §12.44 below for standards for introduction of maps as public records. If contour and topographic information is available via a public record, it should be used to ensure admissibility. It should also be authenticated and verified by an expert qualified to make such an assessment. Larsen, supra, 371 N.E.2d at 310. If contour and topographic information is not available via public record, extrapolation, judgment interpolation, educated guesses, and estimates should be avoided to the extent possible. See Department of Conservation v. First National Bank of Lake Forest, 36 Ill.App.3d 495, 344 N.E.2d 11, 18 (2d Dist. 1976); Forest Preserve District of Cook County v. Tabin, 115 Ill.App.2d 267, 253 N.E.2d 99, 107 (1st Dist. 1969). Authentication and verification of the information from a qualified expert are critical to admission. Forest Preserve District of DuPage County, Illinois v. Harris Trust & Savings Bank, 108 Ill.App.2d 65, 247 N.E.2d 188, 194 (2d Dist. 1969). See also People ex rel. Department of Transportation v. Firstar Illinois, 365 Ill.App.3d 936, 851 N.E.2d 682, 303 Ill.Dec. 495 (discussing previous remand, People ex rel. Illinois Department of Transportation v. Firstar Illinois, 351 Ill.App.3d 1180, 876 N.E.2d 327, 315 Ill.Dec. 327 (2d Dist. 2004) (Rule 23), in which appellate court reversed and remanded matter based on trial court’s improper admission of map that Illinois Department of Transportation’s appraiser used to



estimate value of part taken and damages to remainder and related testimony), appeal denied, 222 Ill.2d 599 (2006). Trial counsel may wish to use a contour or topographic map to illustrate soil or flooding conditions, which is often accomplished by coloring or shading areas of the map. Often this type of evidence is admitted, as in Department of Public Works & Buildings v. Chicago Title & Trust Co., 408 Ill. 41, 95 N.E.2d 903 (1950). In Chicago Title & Trust, the trial court admitted into evidence three contour maps that had been shaded to show the sections of the subject property that were under water, the sections of the property that were subject to flooding from a river, and the remaining sections of the property that were on or above the feasible building plain. The Supreme Court affirmed the trial court’s admission of the contour maps into evidence, stating:

We do not see that they did more than explain testimony of a somewhat technical nature and assist the jury in its determination of the facts. The court did not abuse its discretion in allowing the exhibits into evidence. 95 N.E.2d at 909.

However, the same type of evidence may be properly deemed inadmissible, as in Tabin, supra. In Tabin, the forest preserve district sought introduction of two soil-boring maps — one that contained only the boring results and one on which the forest preserve district had used various colors to depict the depths and makeup of the soil conditions on the subject property. The trial court admitted the results map but refused admission of the colored map. The appellate court held that the colored map was cumulative of the information contained on the results map and further found that the engineer had used judgment interpolation, or educated guesses, to construct the colored map. The appellate court held: “Under the circumstances, we are of the opinion that the trial court did not abuse its discretion in refusing to allow [the colored map] into evidence.” 253 N.E.2d at 107. To establish the existence of wetlands on property, it is best to offer the testimony of a qualified engineer who has examined the site, reviewed photographs and topographical maps, and formulated an opinion based on the standards for determining the presence of wetlands. Depictions of wetlands in such documents as environmental impact statements or construction plans may not be binding. Department of Transportation v. LaSalle National Bank, 251 Ill.App.3d 901, 623 N.E.2d 390, 191 Ill.Dec. 145 (2d Dist. 1993). 4. [12.44] Public Records Lombard Park District v. Chicago Title & Trust Co., 105 Ill.App.2d 371, 245 N.E.2d 298 (2d Dist. 1969), sets forth the governing rule as to the admissibility of public records in Illinois eminent domain cases. The appellate court held:

Generally, public records may come within an exception to the hearsay rule if required either by statute or authorized to be maintained by the nature of the office. Such records are evidence of those matters which are properly required to be maintained and recorded therein. This exception to the hearsay rule is based upon assumptions that public officers will perform their duties and are without motive to falsify, and that public inspection to which such records may be subject will disclose



inaccuracies. . . . [S]ince official documents are a substitute for the personal appearance of the official, charged with their preparation, in court, it is generally held that such documents, to be admissible must concern matters to which the official could testify if he were called to the witness stand. 245 N.E.2d at 301 – 302.

Particular authority must be demonstrated before a document can be admitted into evidence as a public record. 245 N.E.2d at 302. If it is not shown, the document is not admitted as a public record. The following have been deemed properly admitted into evidence: a. an enlarged version of the Lake County soil map covering the subject property prepared

by the Soil Conservation Service of the United States Department of Agriculture and by the Illinois Agriculture Experiment Station pursuant to statute (16 U.S.C. §590i) and under the regulations for the conduct of soil mapping (7 C.F.R. pt. 611; Department of Conservation v. First National Bank of Lake Forest, 36 Ill.App.3d 495, 344 N.E.2d 11, 18 (2d Dist. 1976));

b. Des Plaines River data, which gave water levels of the river adjacent to the subject

property and was recorded by the Lake County Highway Department, pursuant to delegation by the Illinois Division of Waterways under the authorization set forth in 615 ILCS 5/23 (Lake County Forest Preserve District v. Larsen, 55 Ill.App.3d 783, 371 N.E.2d 306, 309, 13 Ill.Dec. 589 (2d Dist. 1977)); and

c. a floodplain topographic map of the Des Plaines River Watershed in Lake County

prepared by the Soil Conservation Service of the United States Department of Agriculture and required by statute (16 U.S.C. §§1001, 1002, 1006; Larsen, supra, 371 N.E.2d at 310).

Although no Illinois court has addressed the issue of flood insurance rate maps or flood hazard boundary maps (see §12.17 above), which are created under the direction of the Federal Insurance Administration and Mitigation Administration as part of the National Flood Insurance Program, these maps are a valuable source of information and are typically used to establish flooding characteristics. The maps are created pursuant to the National Flood Insurance Act (see 42 U.S.C. §4101) and are maintained by the local branch of the Federal Emergency Management Agency. Caution should be exercised in the use of these maps as the legend states: “This map is for flood insurance purposes only; it does not necessarily show all areas subject to flooding in the community or all planimetric features outside special flood hazard areas.” Therefore, verification of the information is necessary through either the Illinois Department of Natural Resource’s Office of Water Resources or a qualified engineer. A map entitled “Geological Survey Hydrological Investigations Atlas HA-143 ‘Floods in the Lombard Quadrangle, Illinois’ ” was found by the Second District in Lombard Park District, supra, not to have the indicia of reliability necessary to be admitted as a public record because the Director of the Geological Survey was not shown to have statutory authority or direction to record or preserve hydrological data: “Particular authority must be demonstrated before we can conclude anything other than this map was not authorized but rather incidentally logged in the



office of the Department of the Interior.” 245 N.E.2d at 302. The appellate court also noted possible inaccuracies on the map. In Department of Transportation v. LaSalle National Bank, 251 Ill.App.3d 901, 623 N.E.2d 390, 191 Ill.Dec. 145 (2d Dist. 1993), the appellate court held that the absence of wetland delineations on environmental impact statements and construction plans did not bar IDOT from attempting to delineate wetlands on the subject property. IDOT could prove the existence of wetlands through the testimony of a qualified engineer. Even if statutory authority for collecting the data is proved, however, evidence can be presented to overcome the presumption of accuracy. Larsen, supra, 371 N.E.2d at 310. Therefore, verification of data by a qualified engineer should always be conducted. Certification of the public record along the lines found in Larsen is advisable unless a stipulation has been entered into between the parties or S.Ct. Rule 216(d) has been used. The certification should verify the following: a. The document is a part of the official public records of that office. b. The document contains a reference to the statute or authorization for the requirement that the document be maintained by the office. c. The statutory requirement for creating the document has been fulfilled. d. The document is a true and correct copy of the official public record. E. [12.45] Appraisal Standards On July 1, 2002, the Real Estate Appraiser Licensing Act of 2002, 225 ILCS 458/1-1, et seq., became effective. Article 5 of the Act sets forth the licensing provisions; Article 10 contains the business practice provisions. Section 10-10 of the Act provides:

All persons licensed under this Act must comply with standards of professional appraisal practice adopted by the Department. The Department must adopt, as part of its rules, the Uniform Standards of Professional Appraisal Practice (USPAP) as published from time to time by the Appraisal Standards Board of the Appraisal Foundation. The Department shall consider federal laws and regulations regarding the licensure of real estate appraisers prior to adopting its rules for the administration of this Act. 225 ILCS 458/10-10.

Under the regulations of the Division of Professional Regulation of the Department of Financial and Professional Regulation, standards published by the Appraisal Standards Board of the Appraisal Foundation, entitled Uniform Standards of Professional Appraisal Practice, effective January 1, 2008, available at uspap.org, govern the conduct of state-certified appraisers. 68 Ill.Admin. Code §1455.240(a).

http://uspap.org/


Appeals PATRICIA A. SMALL Barrett, Twomey, Broom, Hughes & Hoke, LLP Carbondale

13



I. [13.1] Scope of Chapter II. Preliminary Considerations A. [13.2] Preservation of Error for Review B. [13.3] Waiver of Right To Appeal C. [13.4] Standards of Review for Eminent Domain Proceedings D. [13.5] Notice of Appeal and Timeliness of Notice of Appeal III. [13.6] No Error vs. Error A. [13.7] No Error B. Error 1. [13.8] Nonreversible Error 2. [13.9] Reversible Error IV. Additional Considerations A. [13.10] Possession Pending Appeal B. [13.11] Interest C. [13.12] Code of Civil Procedure §2-1401 D. [13.13] Prospective Application V. [13.14] Particular Types of Appeals A. Interlocutory Appeals 1. [13.15] Appeal from Final Judgment Not Disposing of Entire Proceeding 2. [13.16] Interlocutory Appeal as of Right 3. [13.17] Interlocutory Appeal by Permission B. [13.18] Appeal from Order Relating to Traverse or Motion To Dismiss C. [13.19] Appeal from Findings as to Rights of Parties D. [13.20] Appeal from Order Granting New Trial E. [13.21] Appeal from Consent Judgment VI. [13.22] Appeal to Illinois Supreme Court A. [13.23] Direct Appeal B. [13.24] Certificate of Importance C. [13.25] Appeal as of Right

APPEALS


VII. [13.26] Costs, Expenses, and Reasonable Attorneys’ Fees VIII. [13.27] Conclusion



I. [13.1] SCOPE OF CHAPTER Pursuant to Illinois Supreme Court Rule 301, every final judgment of a circuit court in a civil case is appealable as of right. An appeal of the final judgment in an eminent domain proceeding, like an appeal of the final judgment in any other type of civil case, is initiated by the filing of a notice of appeal. No other step is jurisdictional. There are, of course, many decisions to be made before an appeal is initiated. The following are only some of the considerations that precede the filing of a notice of appeal. Was there error in the proceeding? Has that error been properly preserved for review? Given the applicable standard of review, is a favorable result likely on appeal? Is a postjudgment motion necessary before a notice of appeal can be filed? Does the client wish to expend the money and time required to pursue an appeal? The unique character of eminent domain proceedings raises additional considerations. In a quick-take condemnation, can an interlocutory appeal be taken after the quick-take proceeding and before the trial on just compensation? When can an appeal be taken if the condemnee files a traverse and motion to dismiss? In a non-quick-take condemnation, must the condemnor wait until the conclusion of the appeal to obtain possession of the property? Does interest accrue on the judgment during the appeal? The procedural steps for prosecuting an appeal are governed by the Illinois Supreme Court Rules and are common to all appeals. For guidance, see ILLINOIS CIVIL APPEALS: STATE AND FEDERAL (IICLE®, 2015). The purpose of this chapter is to acquaint the eminent domain practitioner with issues that arise in prosecuting an eminent domain appeal, some of which are common to all appeals and some of which are unique to eminent domain appeals. II. PRELIMINARY CONSIDERATIONS A. [13.2] Preservation of Error for Review The basis of an appeal is error in the eminent domain proceeding that prejudiced the appealing party’s right to a fair trial. A preliminary consideration in any decision to appeal is a determination of whether the error to be argued on appeal has been preserved on the record. The following discussion identifies some of the errors that could be alleged and the action that must be taken during the course of the eminent domain proceeding to preserve the error for review. 1. An argument that the condemnor lacks authority to exercise the right of eminent domain generally requires that the condemnee file a traverse or motion to dismiss during the preliminary stage of the eminent domain proceeding. Towne v. Town of Libertyville, 190 Ill.App.3d 563, 546 N.E.2d 810, 813, 137 Ill.Dec. 865 (2d Dist. 1989). An objection to the condemnation proceeding is waived by the failure to raise it in the appropriate manner and at an appropriate time. 546 N.E.2d at 814. See also Board of Trustees of University of Illinois v. Shapiro, 343 Ill.App.3d 943, 799 N.E.2d 383, 278 Ill.Dec. 665 (1st Dist. 2003) (landowner’s contention that board failed to

APPEALS §3.2


exercise its eminent domain powers in accordance with statutory authority, thereby rendering its condemnation proceeding void, waived for review for failure to file traverse or motion to dismiss). 2. A party who fails to obtain a ruling from the court on a motion waives the issue on appeal. City of Springfield, Illinois v. West Koke Mill Development Corp., 312 Ill.App.3d 900, 728 N.E.2d 781, 788, 245 Ill.Dec. 699 (4th Dist. 2000) (motion to reconsider motion to dismiss). 3. A party objecting to the other side’s use of a certain type of evidence must object during trial and have the objection overruled before introducing evidence of the same class to meet the evidence used by the other side or the right to claim the benefit of the objection is waived on appeal. Department of Transportation v. Quincy Coach House, Inc., 64 Ill.2d 350, 356 N.E.2d 13, 17, 1 Ill.Dec. 13 (1976) (condemnor’s right to object was not precluded by fact that condemnor’s witness stated on cross-examination that he had considered income approach and thereby used same type of evidence used by landowner’s witnesses); Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 163 Ill.2d 498, 645 N.E.2d 896, 898, 206 Ill.Dec. 644 (1994) (landowners who, after their motions in limine were denied, opted to be first to inject evidence to which they objected into proceeding rather than renew their objection to evidence during trial could not complain that presentation of these matters to jury rendered its verdict fatally infirm). 4. An assignment of error concerning an occurrence in the course of the trial generally requires that a timely objection be made or other necessary action be taken. For example, a. after a motion in limine has been denied, failure to object to disputed evidence the first

time it is introduced at trial waives the right to raise the issue on appeal (Heritage Standard, supra);

b. an objecting party must specify the grounds for the objection, and grounds not argued in

the trial court regarding the admissibility of evidence are waived on review (Oak Brook Park District v. Oak Brook Development Co., 170 Ill.App.3d 221, 524 N.E.2d 213, 221, 120 Ill.Dec. 448 (2d Dist. 1988); Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 196 Ill.App.3d 5, 552 N.E.2d 1151, 1166, 142 Ill.Dec. 410 (2d Dist. 1990));

c. the failure to move to strike or to request an instruction to the jury to disregard the

evidence when testimony that appears to be admissible is admitted, but later appears to be inadmissible, waives any right to predicate error on such testimony (Department of Public Works & Buildings of State of Illinois ex rel. People v. Exchange National Bank of Chicago, 40 Ill.App.3d 623, 356 N.E.2d 376, 385, 1 Ill.Dec. 250 (2d Dist. 1976));

d. if the trial court excludes the testimony of a witness on a particular matter, an offer of

proof is necessary to preserve the issue for review (Illinois State Toll Highway Authority v. Itasca Bank & Trust Co., 216 Ill.App.3d 926, 576 N.E.2d 1221, 1227, 160 Ill.Dec. 267 (2d Dist. 1991));



e. the failure to timely object to closing argument waives the claimed prejudice unless the argument to which no objection was made is so prejudicial as to deny the party a fair trial (Oak Brook, supra, 524 N.E.2d at 226; Department of Transportation of State of Illinois ex rel. People v. Roodhouse, 104 Ill.App.3d 880, 433 N.E.2d 703, 706, 60 Ill.Dec. 661 (4th Dist. 1982)); and

f. the failure to tender an alternate instruction waives a complaint that an instruction was

not given (Forest Preserve District of DuPage County v. Brookwood Land Venture, 199 Ill.App.3d 973, 557 N.E.2d 980, 985, 146 Ill.Dec. 38 (2d Dist. 1990)).

5. A postjudgment motion may be required before an appeal can be taken. A posttrial motion is required in jury cases (735 ILCS 5/2-1202), but a postjudgment motion is optional in nonjury cases (735 ILCS 5/2-1203). For the postjudgment motion to toll the time for filing a notice of appeal, it must be timely filed. Sections 2-1202 and 2-1203 of the Code of Civil Procedure, 735 ILCS 5/1-101, et seq., both provide that the postjudgment motion must be filed within 30 days after the entry of judgment “or within any further time the court may allow within the 30 days or any extensions thereof.” 735 ILCS 5/2-1202(c), 5/2-1203(a). The request for an extension of time for filing a postjudgment motion must be made and the order granting an extension of time must be entered within the 30-day period or within any period of extension already given. In re Estate of Kunsch, 342 Ill.App.3d 552, 794 N.E.2d 1059, 1062, 276 Ill.Dec. 809 (2d Dist. 2003). In other words, when the 30-day period or an extension period already granted expires without the entry of a new order setting a new deadline for filing the postjudgment motion, the trial court loses jurisdiction over the case. Id. The one exception to this rule occurs when a postjudgment motion filed by one party is still pending because then the underlying judgment is not final and the trial court still has jurisdiction to grant the other party an extension for filing a postjudgment motion. 794 N.E.2d at 1063. A posttrial motion filed under §2-1202 in a jury case must include all errors the practitioner plans to argue on appeal. Grounds or reasons for a new trial not specified in the motion for a new trial are waived on review. County Board of School Trustees of Macon County v. Batchelder, 7 Ill.2d 178, 130 N.E.2d 175, 178 – 179 (1955). A detailed postjudgment motion is not required under §2-1203 in a nonjury case. Kingbrook, Inc. v. Pupurs, 202 Ill.2d 24, 779 N.E.2d 867, 873, 269 Ill.Dec. 13 (2002). A careful practitioner will, nevertheless, provide specific, detailed postjudgment motions in both jury and nonjury cases. A motion that merely requests that the trial court state the factual findings and/or legal conclusions supporting a previously entered judgment is not a postjudgment motion within the meaning of §2-1203. Hayes Machinery Movers, Inc. v. REO Movers & Van Lines, Inc., 338 Ill.App.3d 443, 788 N.E.2d 259, 262, 272 Ill.Dec. 955 (1st Dist. 2003); R & G, Inc. v. Midwest Region Foundation for Fair Contracting, Inc., 351 Ill.App.3d 318, 812 N.E.2d 1044, 286 Ill.Dec. 29 (4th Dist. 2004).

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S.Ct. Rule 274 provides that a “party may make only one postjudgment motion directed at a judgment order that is otherwise final.” Rule 274 further provides:

If a final judgment order is modified pursuant to a postjudgment motion, or if a different final judgment or order is subsequently entered, any party affected by the order may make one postjudgment motion directed at the superseding judgment or order. Until disposed, each timely postjudgment motion shall toll the finality and appealability of the judgment or order at which it is directed.

Rule 274 codifies Gibson v. Belvidere National Bank & Trust Co., 326 Ill.App.3d 45, 759 N.E.2d 991, 259 Ill.Dec. 930 (2d Dist. 2001). 6. The plain-error doctrine allows a reviewing court to review claims of error not properly preserved at trial. Lange v. Freund, 367 Ill.App.3d 641, 855 N.E.2d 162, 170, 305 Ill.Dec. 271 (1st Dist. 2006). However, the doctrine is applied in civil cases only when the error complained of is a prejudicial error so egregious that it deprived the complaining party of a fair trial and substantially impaired the integrity of the judicial process itself. Id.

PRACTICE POINTERS

The practitioner who has done everything that is necessary in the trial court to preserve the error for review must also do everything that is necessary in the reviewing court to continue to preserve the error for review. For example, the reviewing court need not consider assignments of error for which the appellant has made no argument and given no citation of authority. Batchelder, supra, 130 N.E.2d at 178. See also Byron Dragway, Inc. v. County of Ogle, 326 Ill.App.3d 70, 759 N.E.2d 595, 599, 259 Ill.Dec. 815 (2d Dist. 2001) (although plaintiff alleged violations of state and federal constitutional law in trial and appellate courts, only federal constitutional law issues were reviewed because both plaintiff and defendant limited their arguments and supporting authority to considerations of federal constitutional law); Southwestern Illinois Development Authority v. Vollman, 235 Ill.App.3d 32, 600 N.E.2d 926, 929, 175 Ill.Dec. 683 (5th Dist. 1992) (landowner’s bare assertion that interlocutory appeal included issues properly appealable under S.Ct. Rule 307(a)(7) and former Code of Civil Procedure §7-104(b) without support of authority or argument amounted to waiver of those issues); Enbridge Pipelines (Illinois), L.L.C. v. Troyer, 2015 IL App (4th) 150334, ¶21, 38 N.E.2d 1282, 395 Ill.Dec. 526 (landowners forfeited argument that preliminary injunction was unconstitutional taking by failing to develop it as required by S.Ct. Rule 341(h)).

S.Ct. Rule 341(h)(7) provides that points not argued in the appellant’s initial brief are

waived and shall not be raised in the reply brief, in oral argument, or on petition for rehearing. Because this rule is not jurisdictional, it may be relaxed if necessary for a just result and a uniform body of precedent. Department of Transportation ex rel. People v. 151 Interstate Road Corp., 333 Ill.App.3d 821, 777 N.E.2d 369, 386, 267 Ill.Dec. 566 (2d Dist. 2002), aff’d in part, rev’d in part, 209 Ill.2d 471 (2004).



An issue not raised in the petition for leave to appeal is forfeited. City of Chicago v. ProLogis, 236 Ill.2d 69, 923 N.E.2d 285, 291, 337 Ill.Dec. 726 (2010). However, because the forfeiture rule is not jurisdictional, in certain specific circumstances it does not prevent a reviewing court from considering an issue not raised in a petition for leave to appeal. Id. Those circumstances include when the new argument does not introduce a different theory of the case sharply at odds with the original theory and the additional issue raised on review concerns portions of the cause of action that have been presented to and adjudicated by the lower courts. See Dineen v. City of Chicago, 125 Ill.2d 248, 531 N.E.2d 347, 126 Ill.Dec. 52 (1988).

An argument not raised in the trial court cannot be raised for the first time on appeal.

Village of Palatine v. Palatine Associates, LLC, 2012 IL App (1st) 102707, ¶¶64 – 69, 966 N.E.2d 1174, 359 Ill.Dec. 486.

B. [13.3] Waiver of Right To Appeal Preserving the error for review is only one of the hurdles to obtaining review. The party wishing to appeal must also be careful not to take any action that will result in a waiver of the right to appeal. For example, depositing the award fixed in the judgment order estops the condemnor from appealing the award. County of Cook v. Malysa, 39 Ill.2d 376, 235 N.E.2d 598, 601 (1968). Caselaw establishing the right of an ordinary judgment debtor to pay the judgment without waiving the right to appeal is inapplicable because an “entirely different situation is presented by” an eminent domain proceeding. 235 N.E.2d at 600. No liability is imposed on the condemnor by the judgment, which merely establishes the value that the condemnor must pay to acquire title. The condemnor is under no compulsion to pay the award, nor may execution issue upon the award. Id. When the condemnor deposits the condemnation award, only its right to attack the judgment is waived. City of DeKalb v. Anderson, 22 Ill.App.3d 40, 316 N.E.2d 653, 656 (2d Dist. 1974). Such a deposit does not affect the jurisdiction of the trial court or the rights of the other parties. Id. Thus, in Anderson, the trial court retained jurisdiction over the final order until the last timely filed postjudgment motion was ruled on.

PRACTICE POINTER

Depositing the award will not estop the condemnor from appealing the trial court’s grant of a new trial to the condemnee. In fact, in such a situation, if the condemnor strongly believes that the reviewing court will reverse the trial court’s grant of a new trial, the condemnor may wish to make the deposit to prevent the accrual of interest on the judgment during the pendency of the appeal.

APPEALS §3.4


If the condemnee withdraws the money deposited by the condemnor in satisfaction of the award, the condemnee is estopped from appealing the award. Department of Public Works & Buildings, State of Illinois v. Forbeck, 118 Ill.App.2d 231, 254 N.E.2d 182, 183 – 184 (3d Dist. 1969); Malysa, supra, 235 N.E.2d at 601. In a quick-take condemnation, however, withdrawing the preliminary just compensation does not estop the condemnee from later appealing the final just compensation award. Department of Transportation of State of Illinois ex rel. People v. Gass, 165 Ill.App.3d 562, 519 N.E.2d 90, 92, 116 Ill.Dec. 500 (5th Dist. 1988), overruled in part on other grounds by Illinois State Toll Highway Authority v. American National Bank & Trust Company of Chicago, 162 Ill.2d 181, 642 N.E.2d 1249, 1254, 205 Ill.Dec. 132 (1994). The condemnee in a quick-take condemnation also does not waive the right to appeal the award by complying with a court order to deposit the amount by which the preliminary compensation exceeded the final compensation. Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 157 Ill.2d 282, 626 N.E.2d 213, 220, 193 Ill.Dec. 180 (1993). A mortgagee, by entering into a settlement and release of claims with the landowners-mortgagors, did not waive its right to appeal the apportionment of a condemnation award that allowed the landowners’ attorney to withdraw the attorney’s fee. Village of Clarendon Hills v. Mulder, 278 Ill.App.3d 727, 663 N.E.2d 435, 439, 215 Ill.Dec. 424 (2d Dist. 1996). The settlement agreement between the mortgagee and the landowners-mortgagors contained an express reservation of the mortgagee’s right to appeal the trial court’s order granting the landowners’ attorney’s motion to withdraw the attorney’s fee. In addition, the mortgagee did not waive its right to appeal by withdrawing a portion of the condemnation award. Id. Since the mortgagee was not appealing the total amount of the condemnation award, Forbeck, supra, and Malysa, supra, were not applicable or relevant.

PRACTICE POINTERS

A practitioner representing a condemnor as the appellant will want to review the provisions of S.Ct. Rule 305(k). Failure to obtain a stay pursuant to Rule 305 will render a condemnor’s appeal moot if the condemnee, during the pendency of the appeal, conveys title to a third-party purchaser who is neither a party to the litigation nor a nominee of the condemnee. Town of Libertyville v. Moran, 179 Ill.App.3d 880, 535 N.E.2d 82, 86, 128 Ill.Dec. 868 (2d Dist. 1989). In such a situation, a reversal or modification of the judgment on appeal will not bind the third-party purchaser. Id.

The practitioner representing the appellee will want to remember that a challenge to the

jurisdiction of the appellate court can be raised at any time and cannot be waived by any prior failure to object to jurisdiction. Village of River Forest v. Ash Realty Co., 23 Ill.App.3d 645, 321 N.E.2d 68, 70 (1st Dist. 1974).

C. [13.4] Standards of Review for Eminent Domain Proceedings The determination of whether to pursue an appeal necessarily involves consideration of the standard of review that will guide the decision of the reviewing court.



1. A de novo standard of review is applied for the following:

a. the constitutionality of a taking (City of Chicago v. Eychaner, 2015 IL App (1st) 131833, ¶50, 26 N.E.3d 501, 389 Ill.Dec. 411);

b. whether the condemnor’s motion to abandon its eminent domain action is constitutionally

sound (City of Chicago v. Harris Trust & Savings Bank, 346 Ill.App.3d 609, 804 N.E.2d 724, 730, 281 Ill.Dec. 759 (1st Dist. 2004));

c. whether a statute is constitutional on its face (Davis v. Brown, 221 Ill.2d 435, 851 N.E.2d

1198, 1204, 303 Ill.Dec. 773 (2006)); d. issues of statutory construction (Department of Transportation of State of Illinois v.

Tucker, 366 Ill.App.3d 739, 853 N.E.2d 749, 752, 304 Ill.Dec. 672 (3d Dist. 2006)) or interpretation (Eychaner, supra, 2015 IL App (1st) 131833 at ¶81);

e. questions of law (People ex rel. Department of Transportation v. Firstar Illinois, 365

Ill.App.3d 936, 851 N.E.2d 682, 685, 303 Ill.Dec. 495 (2d Dist. 2006) (whether trial court violated appellate court’s mandate on remand is question of law); Department of Transportation, State of Illinois v. Lowderman, LLC, 367 Ill.App.3d 502, 854 N.E.2d 261, 263, 304 Ill.Dec. 919 (3d Dist. 2006) (whether there has been actionable taking or material impairment of access that entitles property owner to compensation is question of law); Department of Transportation v. Chicago Title & Trust Co., 303 Ill.App.3d 484, 707 N.E.2d 637, 645, 236 Ill.Dec. 510 (1st Dist. 1999) (whether certain parcels of land constitute one parcel for ascertaining remainder damages in eminent domain action is question of law); Department of Transportation v. East Side Development, L.L.C., 384 Ill.App.3d 295, 892 N.E.2d 136, 139, 322 Ill.Dec. 889 (3d Dist. 2008) (determination of the proper method of compensation in eminent domain proceeding is question of law)); Enbridge Pipelines (Illinois), L.L.C. v. Troyer, 2015 IL App (4th) 150334, ¶15, 38 N.E.2d 1282, 395 Ill.Dec. 526 (whether legal authority exists to support trial court’s decision to grant access to condemnor before jury determined just compensation and condemnor paid that amount to condemnee is question of law);

f. the trial court’s order granting or denying a motion to dismiss on the ground of res

judicata (Rock River Water Reclamation District v. Sanctuary Condominiums of Rock Cut, 2014 IL App (2d) 130813, ¶41, 30 N.E.2d 1081, 391 Ill.Dec. 443); and

g. the trial court’s decision to deny a judgment notwithstanding the verdict, applying the

same standard used by the trial court, i.e., whether all the evidence, when viewed in the light most favorable to the opponent, so overwhelmingly favors the movant that no contrary verdict based on that evidence could ever stand (Department of Transportation v. Drury Displays, Inc., 327 Ill.App.3d 881, 764 N.E.2d 166, 261 Ill.Dec. 875 (5th Dist. 2002)).

2. An abuse of discretion standard of review is applied for the following:

APPEALS §3.4


a. the trial court’s decision concerning the conduct of discovery (Firstar Illinois, supra, 851 N.E.2d at 687);

b. the trial court’s ruling on a request for a continuance (Southwestern Illinois Development

Authority v. Al-Muhajirum, 348 Ill.App.3d 398, 809 N.E.2d 730, 733, 284 Ill.Dec. 164 (5th Dist. 2004));

c. the trial court’s decision to grant or deny a motion in limine (City of Quincy, Illinois v.

Diamond Construction Co., 327 Ill.App.3d 338, 762 N.E.2d 710, 261 Ill.Dec. 141 (4th Dist. 2002));

d. the trial court’s determination on the admissibility of expert testimony (Al-Muhajirum,

supra); e. the trial court’s admission or exclusion of evidence (Board of Trustees of University of

Illinois v. Shapiro, 343 Ill.App.3d 943, 799 N.E.2d 383, 390, 278 Ill.Dec. 665 (1st Dist. 2003));

f. the trial court’s limitation of cross-examination (Eychaner, supra, 2015 IL App (1st)

131833 at ¶100) (trial court will be reversed only if abuse of discretion resulted in manifest prejudice to limited party); and

g. the trial court’s determination as to proper jury instructions (Department of

Transportation v. Bolis, 313 Ill.App.3d 982, 730 N.E.2d 1152, 1156 – 1157, 246 Ill.Dec. 687 (3d Dist. 2000) (only when refusal to give tendered instruction amounts to serious prejudice to party’s right to fair trial will new trial be granted)).

An abuse of discretion may be found only when the trial court’s decision is arbitrary, fanciful, or unreasonable or when no reasonable person would take the view adopted by the trial court. People ex rel. Department of Transportation v. Kotara, L.L.C., 379 Ill.App.3d 276, 884 N.E.2d 1235, 1244, 318 Ill.Dec. 964 (3d Dist. 2008). 3. A contrary to the manifest weight of the evidence standard of review is applied for the trial court’s decision to grant the condemnor’s motion to abandon the condemnation proceeding. City of Chicago v. Harris Trust & Savings Bank, 346 Ill.App.3d 609, 804 N.E.2d 724, 730, 281 Ill.Dec. 759 (1st Dist. 2004). A decision is against the manifest weight of the evidence if the facts clearly demonstrate that the court should have reached the opposite conclusion. Id. A reviewing court will not disturb a trial court’s award of just compensation when the award is within the range of evidence unless the award can be attributed to passion, prejudice, or clear mistake. Village of Round Lake v. Amann, 311 Ill.App.3d 705, 725 N.E.2d 35, 45, 244 Ill.Dec. 240 (2d Dist. 2000). However, even if the trial court adopted an improper method of valuation, the ultimate question is whether the compensation awarded is adequate to make the landowner whole. 725 N.E.2d at 46. When an award is made by a jury in an eminent domain proceeding in which the evidence is



conflicting, the jury views the property, and the verdict is within the range of evidence, the jury’s verdict will not be disturbed on appeal unless there has been a clear and palpable mistake or a showing that the verdict was the result of passion or prejudice or unless the trial court made an erroneous ruling that might have misled the jury and amounts to prejudicial error. Bolis, supra, 730 N.E.2d at 1155. When alleging on appeal that the trial court made an erroneous ruling that misled the jury and amounted to prejudicial error, the appellant need not claim that the verdict was excessive, manifestly against the weight of the evidence, or the result of passion or prejudice. Department of Public Works & Buildings v. Oberlaender, 42 Ill.2d 410, 247 N.E.2d 888, 893 – 894 (1969). It is, however, difficult to obtain a reversal on the basis of an alleged erroneous ruling with regard to the admission or exclusion of valuation evidence. On review, a trial court’s ruling on evidentiary issues is subject to the abuse of discretion standard. Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 250 Ill.App.3d 665, 619 N.E.2d 1321, 1326, 189 Ill.Dec. 272 (2d Dist. 1993), aff’d, 163 Ill.2d 498 (1994). A reversal is called for only if the evidence improperly admitted was sufficiently prejudicial to change the outcome of the trial. Id. In Illinois, the law is well established that the improper admission or exclusion of value evidence in condemnation cases does not constitute reversible error when there are other witnesses and evidence as to value on both sides and when the jury had the opportunity to view the property and weigh the conflicting evidence. Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 163 Ill.2d 498, 645 N.E.2d 896, 899, 206 Ill.Dec. 644 (1994).

PRACTICE POINTERS

A practitioner must prevent the reviewing court from latching onto the foregoing well-established law of Illinois as the basis for not finding reversible error when it is not properly applied. The relevant inquiry is whether the jury’s verdict is within the range of competent and properly admissible evidence. Department of Transportation v. First Bank of Schaumburg, 260 Ill.App.3d 490, 631 N.E.2d 1145, 1148, 197 Ill.Dec. 686 (1st Dist. 1992). In Bolis, supra, the Illinois Department of Transportation (IDOT) argued that the trial court erred in allowing the defendants’ expert appraisal witness to opine as to the damages to the remainder based on a dollar-for-dollar reduction in property value equal to the cost-to-cure bids. 730 N.E.2d at 1155. An expert valuation witness may consider expenses made necessary by reason of the acquisition to adjust the property to the changed conditions brought about by the taking, but such costs cannot be recovered specifically and are not the measure of damages. First Bank of Schaumburg, supra, 631 N.E.2d at 1148 – 1149. If IDOT’s contention in Bolis was correct that the witness’s opinion of damages to the remainder equaled the costs to cure, then the opinion was inadmissible. The trial court’s striking of references to specific cost-to-cure amounts would not be sufficient. The jury was faced with one opinion as to the damages to the remainder from each side. Improper admission of the defendants’ valuation witness’s opinion as to the damages to the remainder inflated the upper end ($61,337.16) of the range of evidence between which the jury’s award for damages to the remainder could fall. Without that evidence, the upper end of the range of evidence would have been the opinion of IDOT’s valuation witness — $8,758. The prejudicial effect of the error is apparent in the jury’s award of $33,000 for damages to the remainder — nearly one half

APPEALS §3.5


of the opinion of the defendants’ valuation witness and almost four times greater than the opinion of IDOT’s valuation witness.

An appellant who convinces the reviewing court that there was a clear and palpable

mistake, that the verdict was the result of passion or prejudice, or that an erroneous ruling misled the jury and amounted to prejudicial error still may not have done enough to obtain a new trial. The appellant must also convince the reviewing court that a better result will be obtained in another trial. Chicago Land Clearance Commission v. Darrow, 12 Ill.2d 365, 146 N.E.2d 1, 6 (1957).

Although not, strictly speaking, a standard of review, it may be helpful to remember that

an appellate court may affirm a trial court on any basis supported by the record beyond the grounds asserted by the trial court, even if the asserted grounds were erroneous. Amann, supra, 725 N.E.2d at 46. See also Lowderman, supra. See Gernand v. Illinois Commerce Commission, 286 Ill.App.3d 934, 676 N.E.2d 1384, 1389, 222 Ill.Dec. 180 (4th Dist. 1997), for an application of this rule to an administrative review dealing with eminent domain issues.

D. [13.5] Notice of Appeal and Timeliness of Notice of Appeal Once the preliminary matters have been considered and a decision has been made to go forward with an appeal, a notice of appeal must be filed for the reviewing court to have jurisdiction. The form and contents of a notice of appeal are set forth in S.Ct. Rule 303(b). Significantly, a notice of appeal “shall specify the judgment or part thereof or other orders appealed from and the relief sought from the reviewing court.” S.Ct. Rule 303(b)(2).

PRACTICE POINTERS

When a postjudgment motion is denied, the notice of appeal should properly identify, instead, the final judgment or order that led to the postjudgment motion. However, it is not fatal if the notice of appeal seeks review of the order denying a postjudgment motion rather than the underlying judgment as long as the appellee is not prejudiced by the error. Wheeler v. Ellison, 124 Ill.App.3d 852, 464 N.E.2d 857, 860, 79 Ill.Dec. 953 (2d Dist. 1984).

When a postjudgment order is denied, an appeal from the judgment is deemed to include

an appeal from the denial of the postjudgment motion. S.Ct. Rule 303(a)(2). Pursuant to S.Ct. Rule 303, the notice of appeal must be filed with the clerk of the circuit court within 30 days after the entry of the final judgment appealed from, or, if a timely postjudgment motion directed against the judgment is filed, within 30 days after the entry of the order disposing of the last pending postjudgment motion directed against that judgment or order, irrespective of whether the circuit court had entered a series of final orders that were modified



pursuant to postjudgment motions. Although this sounds simple enough, the following points should be remembered: 1. If judgment has not been entered on the jury’s verdict, the appellate court does not have jurisdiction to hear the appeal. Illinois State Toll Highway Authority v. Marathon Oil Co., 200 Ill.App.3d 836, 559 N.E.2d 497, 500, 147 Ill.Dec. 324 (2d Dist. 1990). 2. A motion for a new trial filed after the return of the jury verdict but before the entry of the judgment is neither timely nor directed against the judgment and, therefore, does not toll the 30-day period for filing a notice of appeal. Village of Lake in the Hills v. Hain, 222 Ill.App.3d 88, 583 N.E.2d 647, 648 – 649, 164 Ill.Dec. 731 (2d Dist. 1991).

PRACTICE POINTER

What constitutes the entry of judgment is governed by S.Ct. Rule 272, which provides:

If at the time of announcing final judgment the judge requires the submission of a form of written judgment to be signed by the judge or if a circuit court rule requires the prevailing party to submit a draft order, the clerk shall make a notation to that effect and the judgment becomes final only when the signed judgment is filed. If no such signed written judgment is to be filed, the judge or clerk shall forthwith make a notation of judgment and enter the judgment of record promptly, and the judgment is entered at the time it is entered of record.

3. Failure to timely file the postjudgment motion results in a failure to preserve for review those matters set forth in the notice of appeal, even if leave to appeal has been obtained. Department of Transportation of State of Illinois ex rel. People v. Yellow Equipment & Terminals, Inc., 47 Ill.App.3d 116, 361 N.E.2d 814, 815, 5 Ill.Dec. 491 (1st Dist. 1977). 4. “A judgment or order is not final and appealable while a Rule 137 claim remains pending unless the court enters a finding pursuant to Rule 304(a).” S.Ct. Rule 303(a)(1). 5. A notice of appeal filed after the court announces a decision but before the entry of a judgment or order is treated as filed on the date of and after the entry of the judgment or order. Id. 6. When a timely postjudgment motion has been filed by any party, a notice of appeal filed before the entry of the order disposing of the last pending postjudgment motion, or before the final disposition of any separate claim, becomes effective when the order disposing of said motion or claim is entered. S.Ct. Rule 303(a)(2). Thus, Rule 303(a)(2) “protects the rights of an appellant who has filed a ‘premature’ notice of appeal by making the notice of appeal effective when the order denying a postjudgment motion or resolving a still-pending separate claim is entered.” Committee Comments, Rule 303 (Mar. 16, 2007). 7. A party intending to challenge an order disposing of any postjudgment motion or separate claim, or a judgment amended upon such motion, must file a notice of appeal or an amended

APPEALS §3.5


notice of appeal within 30 days of the entry of said order or amended judgment. S.Ct. Rule 303(a)(2). Thus, when a “premature” notice of appeal has been filed, there is no need to file a second notice of appeal when the postjudgment order simply denies the appellant’s postjudgment motion. Committee Comments, Rule 303 (Mar. 16, 2007). However, when a “premature” notice of appeal has been filed and the postjudgment order grants new or different relief than the judgment itself or resolves a separate claim, a second notice of appeal is necessary to preserve an appeal from such an order. Id. 8. The filing of successive postjudgment motions by the same party, such as a motion to reconsider the decision on the first postjudgment motion, does not extend the time to appeal. Department of Transportation of State of Illinois ex rel. People v. Roodhouse, 104 Ill.App.3d 880, 433 N.E.2d 703, 704, 60 Ill.Dec. 661 (4th Dist. 1982). See also S.Ct. Rule 303(a)(2) (“No request for reconsideration of a ruling on a postjudgment motion will toll the running of the time within which a notice of appeal must be filed under this rule.”). 9. S.Ct. Rule 373, which deals with the date of filing papers in the reviewing court, “also applies to a motion directed against the judgment and to the notice of appeal filed in the trial court.”

PRACTICE POINTERS

Under S.Ct. Rule 373, if a postjudgment motion or notice of appeal is received on or before its due date, the time of filing will be the date on which it is actually received by the clerk of the circuit court.

Under S.Ct. Rule 373, if a postjudgment motion or notice of appeal is received after its

due date, the time of filing shall be deemed to be the time of mailing, or the time of delivery to a third-party commercial carrier for delivery to the clerk of the circuit court within three business days. Proof of mailing or delivery to a third-party commercial carrier shall be as provided by Rule 12(b)(3).

Rule 373 deals with the date of filing with the clerk, not service on other parties. A

careful practitioner should include information about mailing or delivery to a third-party commercial carrier for delivery to the clerk in any proof of mailing filed. See Shatku v. Wal-Mart Stores, Inc., 2013 IL App (2d) 120412, ¶10, 990 N.E.2d 826, 371 Ill.Dec. 638 (plaintiff’s “Proof of Mailing” showing service on opposing counsel, but saying nothing about mailing to clerk, insufficient for mailbox rule to apply and, therefore, her motion directed against judgment and notice of appeal were both untimely.)

10. A notice of appeal filed by the condemnor within 30 days of the trial court’s order disposing of a condemnation action is not nullified by a petition for attorneys’ fees subsequently filed by the defendant pursuant to §10-5-70(a) of the Eminent Domain Act (EDA), 735 ILCS 30/1-1-1, et seq. City of Naperville v. Old Second National Bank of Aurora, 327 Ill.App.3d 734, 763 N.E.2d 951, 261 Ill.Dec. 702 (2d Dist. 2002). Such a petition does not attack the trial court’s



judgment in the condemnation action and, therefore, is not considered a postjudgment motion for purposes of 735 ILCS 5/2-1203. Id. For this reason, the petition does not affect the finality of the trial court’s order disposing of the condemnation action and, consequently, does not nullify the effect of a timely filed notice of appeal. Id.

PRACTICE POINTER

What if the condemnor wishes to appeal the order disposing of the condemnation action, but a petition for attorneys’ fees is filed within 30 days of the entry of that order and prior to the filing of a notice of appeal? If the petition for attorneys’ fees is not a postjudgment “motion directed against the judgment,” then it does not toll the time for filing a notice of appeal under S.Ct. Rule 303(a). Therefore, the prudent practitioner representing the condemnor will do as the condemnor’s counsel did in Old Second National Bank, supra, and file the notice of appeal within 30 days of the order disposing of the condemnation action rather than after entry of the order disposing of the petition for attorneys’ fees.

S.Ct. Rule 303(c) provides:

The party filing the notice of appeal . . . shall, within 7 days, file a notice of filing with the reviewing court and serve a copy of the notice of appeal upon every other party and upon any other person or officer entitled by law to notice. Proof of service, as provided by Rule 12, shall be filed with the notice.

Violating S.Ct. Rule 303(c) by not serving the notice of appeal on other parties or parties who may be adversely affected by the appellate court’s decision may result in dismissal of the appeal. See Wells Fargo Bank, N.A. v. Zwolinski, 2013 IL App (1st) 120612, 990 N.E.2d 324, 328, 371 Ill.Dec. 424. The appeal will not be dismissed if there is no evidence of prejudice to the party not served with the notice of appeal. There is no prejudice unless the party not served is thereby unable to file an appellate brief and argue orally. Id. III. [13.6] NO ERROR VS. ERROR What in the context of one case will be considered error may, in the context of a different case, not be considered error at all. Furthermore, the parties are entitled to a fair trial, not a trial that is totally free from error. See People ex rel. Department of Transportation v. Birger, 155 Ill.App.3d 130, 507 N.E.2d 1321, 1327, 107 Ill.Dec. 952 (5th Dist. 1987); Department of Public Works & Buildings v. Klehm, 56 Ill.2d 121, 306 N.E.2d 1, 7 (1973) (ultimate question on review is not whether trial was scrupulously free from error, but whether there was error that operated to prejudice of appealing party or unduly affected outcome below). An all-encompassing analysis of when there is no error or when a particular error in an eminent domain proceeding will be nonreversible error is beyond the scope of this chapter. The material in §§13.7 – 13.9 below is provided to give the eminent domain practitioner some idea of

APPEALS §3.8


what has been judged not to be error, what has been judged to be nonreversible error, and what has been judged to be reversible error in eminent domain proceedings. A. [13.7] No Error In City of Quincy, Illinois v. Diamond Construction Co., 327 Ill.App.3d 338, 762 N.E.2d 710, 261 Ill.Dec. 141 (4th Dist. 2002), the trial court correctly excluded evidence of the second appraisal of the condemnor’s appraiser, which appraisal changed the highest and best use of the property from an asphalt plant to vacant industrial because the landowner traded in and moved certain components of the asphalt plant prior to the filing of the condemnation complaint. The appellate court agreed with Diamond Construction that the second appraisal lacked a proper evidentiary foundation, and, given the unique facts of the case, the trial court properly barred its introduction as evidence under principles of fundamental fairness. Id. The existence of conflicting evidence on the issue of reasonable probability of rezoning does not constitute grounds for reversible error, and, thus, the trial court does not err in permitting the issue of a reasonable probability of rezoning to go to the jury. Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 250 Ill.App.3d 665, 619 N.E.2d 1321, 1326, 189 Ill.Dec. 272 (2d Dist. 1993), aff’d, 163 Ill.2d 498 (1994). The condemnor could present evidence of special benefits accruing to the remainder from entrance and exit ramps not located on the property taken from the landowner because the ramps, as part of the tollway project, were part of the public improvement erected on the property taken from the landowner. Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 196 Ill.App.3d 5, 552 N.E.2d 1151, 1158, 142 Ill.Dec. 410 (2d Dist. 1990). An award of condemnation damages that is within the range of the evidence will not be set aside solely because the verdict did not segregate the value of the land taken from the damage to the remainder. Department of Public Works & Buildings v. Zuccarini, 23 Ill.2d 564, 179 N.E.2d 606, 608 (1962). B. Error 1. [13.8] Nonreversible Error The law of Illinois is well established that the improper admission or exclusion of value evidence does not constitute reversible error when there are other witnesses and evidence as to value on both sides and the jury has the opportunity to view the property and weigh the conflicting evidence. Illinois State Toll Highway Authority v. Heritage Standard Bank & Trust Co., 163 Ill.2d 498, 645 N.E.2d 896, 899, 206 Ill.Dec. 644 (1994). The trial court’s adoption of an improper method of valuation is not reversible error if the compensation awarded was nevertheless adequate to make the defendant whole. Village of Round Lake v. Amann, 311 Ill.App.3d 705, 725 N.E.2d 35, 46, 244 Ill.Dec. 240 (2d Dist. 2000). The trial court’s erroneous paraphrase of a portion of a witness’s testimony was harmless



error. Forest Preserve District of DuPage County v. Brookwood Land Venture, 199 Ill.App.3d 973, 557 N.E.2d 980, 985, 146 Ill.Dec. 38 (2d Dist. 1990). The defendants’ improper closing argument that violated the court’s in limine ruling precluding argument that alternative access to the property existed, considered in the light of the record as a whole, did not rise to the level of reversible error. Id. The defendants’ improper closing argument that focused away from the evidence of fair cash market value and onto antigovernment action and retribution likewise was not reversible error. 557 N.E.2d at 987. The trial court’s error in not admitting the deed for the 1987 sale of a piece of property to rebut the defendants’ expert’s reliance on the 1982 sale price of the same property as a comparable sale in valuing the subject property was harmless because evidence of the 1987 sale was already before the jury and the expert was effectively impeached by his admission that he had not considered the 1987 sale of the property. Illinois State Toll Highway Authority v. Grand Mandarin Restaurant, Inc., 189 Ill.App.3d 355, 544 N.E.2d 1145, 1150 – 1151, 136 Ill.Dec. 370 (2d Dist. 1989). The failure to admit the deed, under these circumstances, did not prejudice the condemnor and did not constitute reversible error. Id. When the condemnor cannot reasonably expect a substantially lower award on retrial, the fact that the trial court erred in allocating the right to open and close the condemnation proceeding is harmless error not requiring reversal of the judgment. Department of Public Works & Buildings of State of Illinois v. Roehrig, 45 Ill.App.3d 189, 359 N.E.2d 752, 762, 3 Ill.Dec. 893 (5th Dist. 1976).

PRACTICE POINTER

The practitioner should keep in mind that although each individual error alone may not justify a new trial, the cumulative effect of several errors together may constitute such harm that it can be rectified only by a new trial. Department of Public Works & Buildings of State of Illinois ex rel. People v. Sun Oil Co., 66 Ill.App.3d 64, 383 N.E.2d 634, 637, 22 Ill.Dec. 826 (5th Dist. 1978).

2. [13.9] Reversible Error Improperly striking testimony that would have raised the upper limit of the values considered by the jury for damage to the remainder is palpable error and cannot be considered harmless. City of Freeport, Illinois v. Fullerton Lumber Co., 98 Ill.App.3d 218, 423 N.E.2d 924, 929, 53 Ill.Dec. 255 (2d Dist. 1981). Given that the jury’s function is to find the value of the subject property, the introduction of impermissible figures by a valuation witness may be so prejudicial that the granting of a motion to strike the testimony and an admonition to the jury to disregard the testimony may not be sufficient. Chicago & Illinois Midland Ry. v. Crystal Lake Industrial Park, Inc., 225 Ill.App.3d 653, 588 N.E.2d 337, 342, 167 Ill.Dec. 696 (3d Dist. 1992).

APPEALS §3.9


The trial court’s error in admitting opinion testimony of the property owners’ experts in an eminent domain proceeding, based in part on an offer to purchase the subject property after the condemnation complaint was filed, is reversible, even if the jury’s verdict falls within the range of the evidence, if the appellate court cannot say with any certainty that the jury’s verdict would have been the same if it had not heard the improper evidence and if there is no way to determine how the opinions of value of the condemnee’s experts would have differed had they not considered the fact of the post-filing offer to purchase. Illinois State Toll Highway Authority v. Dicke, 208 Ill.App.3d 158, 566 N.E.2d 1003, 1011 – 1012, 153 Ill.Dec. 153 (2d Dist. 1991). The admission of specific figures relating to separate values for the land and the improvements thereon (a violation of the unit rule) constitutes palpable and reversible error. Department of Transportation of State of Illinois ex rel. People v. Schlechte, 94 Ill.App.3d 187, 418 N.E.2d 1000, 1002, 50 Ill.Dec. 6 (5th Dist. 1981). An offer to purchase the subject property that is too remote in time to have any relevance on the issues in the condemnation case is prejudicial and unfairly affects the jury’s determination of fair cash market value. Department of Transportation of State of Illinois ex rel. People v. Bryant, 63 Ill.App.3d 483, 380 N.E.2d 464, 468, 20 Ill.Dec. 486 (3d Dist. 1978). It is reversible error to admit testimony of the condemnee’s expert that equates the market value of the land with the value of minerals under the surface. Department of Transportation ex rel. People v. Central Stone Co., 200 Ill.App.3d 841, 558 N.E.2d 742, 749, 146 Ill.Dec. 779 (4th Dist. 1990). The erroneous grant of a motion in limine to exclude evidence of special benefits to the remainder constitutes an erroneous ruling that might have misled the jury and amounts to prejudicial error. Illinois State Toll Highway Authority v. American National Bank & Trust Company of Chicago, 162 Ill.2d 181, 642 N.E.2d 1249, 1256, 205 Ill.Dec. 132 (1994). Because such an error deals with the question of damages, it warrants reversal. Id. This decision overrules, by implication, Illinois State Toll Highway Authority v. Itasca Bank & Trust Co., 216 Ill.App.3d 926, 576 N.E.2d 1221, 160 Ill.Dec. 267 (2d Dist. 1991), the reasoning of which was accepted by the appellate court in ruling that the trial court properly excluded the evidence of special benefits to the remainder from the tollway because no part of the improvement or tollway was located on any part of the property taken. The Supreme Court disagreed, finding that under the clear and unambiguous language of former Code of Civil Procedure §7-119 (now 735 ILCS 30/10-5-50), evidence of special benefits to the remainder from the improvement may be adduced regardless of where the improvement is erected. It was reversible error for the trial court to (a) bar testimony concerning offers to purchase a parcel of land adjacent to the property being condemned and (b) deny the owners’ motion in limine seeking to prevent the jury from learning that the condemnor’s appraiser had previously been retained by the owners in the same matter. County of St. Clair v. Wilson, 284 Ill.App.3d 79, 672 N.E.2d 27, 219 Ill.Dec. 712 (5th Dist. 1996). Decisions regarding admission of evidence in a condemnation case lie within the trial court’s discretion and will not be reversed absent an abuse of that discretion. Previously, the trial court



abused its discretion if it allowed an opinion witness to testify regarding undisclosed opinions absent extenuating circumstances that justified an exception to the disclosure requirements of S.Ct. Rule 213. See Department of Transportation, State of Illinois v. Crull, 294 Ill.App.3d 531, 690 N.E.2d 143, 147, 228 Ill.Dec. 834 (4th Dist. 1998). With the amendment of Rule 213 (eff. July 1, 2002) to differentiate between lay, independent expert, and controlled expert witnesses, whether the trial court abuses its discretion by permitting an opinion witness to testify about undisclosed opinions will depend on the type of opinion witness involved and the nature of the undisclosed opinion. An abuse of discretion is more likely to be found when the testimony of a controlled expert witness includes undisclosed opinions. No abuse of discretion is likely to be found when undisclosed opinions of a lay witness or an independent expert witness fall outside the limitations on the calling party’s knowledge of the facts known by and opinions held by the witness. IV. ADDITIONAL CONSIDERATIONS A. [13.10] Possession Pending Appeal In a quick-take condemnation, the condemnor obtains possession of the property before a trial on the amount of just compensation to be paid to the condemnee, and, therefore, possession of the property pending appeal is not an issue. In a non-quick-take condemnation, the condemnor may already have waited years to get to trial, and, therefore, possession of the property pending appeal is an issue. In such a case, the condemnor need not await the conclusion of the appeal before obtaining possession of the property, whether the condemnor or the condemnee is the appellant. Pursuant to 735 ILCS 30/10-5-80, the condemnor, upon posting a bond, may go into possession of the condemned property pending an appeal of the condemnation judgment. If the State of Illinois is the condemnor, no bond is required. Id.

PRACTICE POINTER

The condemnor may elect, for whatever reason, not to post bond and, therefore, not to take possession of the property pending appeal. However, the condemnee’s right to interest on the condemnation judgment is not defeated by the retention of possession pending appeal due to the condemnor’s election. Lake County Forest Preserve District v. Vernon Hills Development Corp., 92 Ill.2d 72, 440 N.E.2d 848, 851, 64 Ill.Dec. 944 (1982).

B. [13.11] Interest Section 2-1303 of the Code of Civil Procedure provides for interest on judgments and is applicable to non-quick-take condemnations. 735 ILCS 5/2-1303; Department of Conservation v. Jones, 75 Ill.2d 557, 389 N.E.2d 1197, 27 Ill.Dec. 789 (1979). Under §2-1303, interest is first computed on the amount of the jury verdict from the date the verdict is rendered until the date judgment is entered on the verdict. That interest is added to and made a part of the judgment.

APPEALS §3.11


Interest is then to be calculated on the judgment award (the sum of the verdict amount and the interest from the date of the verdict to the date of the judgment) from the date of the judgment until the date the total amount due and owing is satisfied. Lake County Forest Preserve District v. Vernon Hills Development Corp., 92 Ill.2d 72, 440 N.E.2d 848, 851, 64 Ill.Dec. 944 (1982). When the condemnee appeals the award, the condemnor may wish to stop the accrual of interest on the judgment. Under §2-1303, the condemnor may, by tender of payment of the judgment, costs, and interest accrued to the date of tender, stop the further accrual of interest on the judgment notwithstanding the condemnee’s prosecution of an appeal or the condemnee’s taking other steps to reverse, vacate, or modify the judgment. 440 N.E.2d at 852. Remember, however, that if the condemnor wishes to appeal, a deposit of the judgment award not only stops the accrual of interest on the judgment but also estops the condemnor from appealing the award. County of Cook v. Malysa, 39 Ill.2d 376, 235 N.E.2d 598, 601 (1968). If the condemnor has not previously deposited the amount of the award, the condemnee is entitled to postjudgment interest during the pendency of an appeal, even an unsuccessful appeal. Vernon Hills Development, supra, 440 N.E.2d at 851. The condemnee’s right to interest on the condemnation judgment to the date of payment is not defeated by the condemnee’s retained possession of the property pending appeal. Id. Section 20-5-30 of the Eminent Domain Act, rather than §2-1303 of the Code of Civil Procedure, governs the issue of interest in quick-take condemnations. If authority to withdraw the preliminary just compensation is denied due to objection by the condemnor, interest must be paid from the date of the deposit to the date of payment. 735 ILCS 30/20-5-30(2). In addition, interest is paid on the excess of just compensation finally adjudged over the amount of preliminary just compensation set by the court in the quick-take proceedings from the date on which possession of the property was surrendered to the date of payment of the excess. 735 ILCS 30/20-5-30(1). As in a non-quick-take condemnation, if the condemnee appeals the award, the condemnor may wish to stop the accrual of interest by depositing the difference between the final just compensation and the preliminary just compensation and interest accrued to the date of tender. When interest is allowable as provided in EDA §20-5-30(1), no further interest is allowed under the provisions of Code of Civil Procedure §2-1303 or any other law. 735 ILCS 30/20-5-30.

PRACTICE POINTERS

The condemnor must be careful to make a sufficient tender. If the tender is less than what is due, the tender is not valid, and interest will continue to accrue. Vernon Hills Development, supra, 440 N.E.2d at 851. For this reason, the practitioner may want to request an order from the court confirming that the amount deposited constitutes all that is due from the condemnor. If this is done, there should be no question later that the deposit was sufficient to terminate the accrual of interest.

If the condemnor deposits the amount due with the county treasurer to stop the accrual of

statutory interest, income may be earned on the deposit during the pendency of the appeal. In such a situation, the income earned on the deposit belongs to the condemnee.



Morton Grove Park District v. American National Bank & Trust Co., 78 Ill.2d 353, 399 N.E.2d 1295, 1300, 35 Ill.Dec. 767 (1980).

C. [13.12] Code of Civil Procedure §2-1401 Code of Civil Procedure §2-1401, 735 ILCS 5/2-1401, which allows relief from final orders and judgments more than 30 days after the entry thereof but within a two-year period, is applicable to eminent domain proceedings. Department of Business & Economic Development of State of Illinois ex rel. People v. Pioneer Trust & Savings Bank, 15 Ill.App.3d 269, 304 N.E.2d 57, 60 (2d Dist. 1973). Section 2-1401 relief is also applicable to quick-take orders entered pursuant to §20-5-10 of the Eminent Domain Act, 735 ILCS 30/20-5-10. Department of Public Works & Buildings of State of Illinois ex rel. People v. Vogt, 51 Ill.App.3d 770, 366 N.E.2d 310, 317, 9 Ill.Dec. 53 (5th Dist. 1977). A §2-1401 petition can present either a factual or a legal challenge to a final judgment or order. Forest Preserve District of Cook County, Illinois v. Chicago Title & Trust Co., 2015 IL App (1st) 131925, 42 N.E.3d 440, 451, 397 Ill.Dec. 525. The proper standard of review on appeal is dictated by the nature of the challenge presented in the §2-1401 petition. The abuse of discretion standard of review applies to a trial court’s ruling on a §2-1401 petition that presents a factual challenge to a final judgment or order. The de novo standard of review applies to a trial court’s ruling on a §2-1401 petition that presents a legal challenge, such as alleging that the final judgment is void. Id. The requirements for a successful §2-1401 petition also differ depending on whether a factual or legal challenge is being made. For a factual challenge, the §2-1401 petition must set forth specific factual allegations supporting each of the following elements: (1) the existence of a meritorious defense; (2) due diligence in presenting this defense or claim to the trial court in the original action; and (3) due diligence in filing the §2-1401 petition for relief. Id. A §2-1401 petition seeking to vacate a void judgment, a purely legal issue, does not need to establish a meritorious defense or satisfy the due diligence requirements. 42 N.E.3d at 452. A §2-1401 petition that raises a factual challenge enables a party to bring before the court rendering the judgment matters of fact not appearing on the record that, if known at the time the judgment was rendered, would have prevented the entry of the judgment. Department of Public Works & Buildings of State of Illinois ex rel. People v. O’Hare International Bank, 44 Ill.App.3d 934, 358 N.E.2d 1308, 1311, 3 Ill.Dec. 623 (1st Dist. 1976). The moving party must demonstrate that its own negligence did not prevent the trial court from knowing these facts. Inadvertent omissions of a party’s attorney or the attorney’s employees are not grounds for relief under §2-1401 absent a showing of fraud or fundamental unfairness. Id. When fraud is the basis for the claim for relief under §2-1401, the statute of limitations for such relief begins to run from the time of discovery of the fraud relied on, unless the party affected might, with ordinary care, have discovered it. County Board of School Trustees of DuPage County, Illinois v. Association of Franciscan Fathers of State of Illinois, 49 Ill.App.3d 686, 364 N.E.2d 691, 699, 7 Ill.Dec. 530 (2d Dist. 1977).

APPEALS §3.15


PRACTICE POINTER

S.Ct. Rule 304(b)(3) provides that a judgment or order granting or denying any of the

relief prayed for in a §2-1401 petition is immediately appealable without a Rule 304(a) finding.

D. [13.13] Prospective Application As a general rule, a decision will be applied retrospectively. When, however, the reviewing court establishes a new principle of law, particularly one relating to the obligations of a condemnor in an eminent domain proceeding, the practitioner should consider whether it is appropriate to request that the ruling in the case be applied prospectively. Department of Transportation ex rel. People v. Hunziker, 342 Ill.App.3d 588, 796 N.E.2d 122, 277 Ill.Dec. 407 (3d Dist. 2003) (appellate court held that its ruling that 735 ILCS 5/7-102.1(d) (now 735 ILCS 30/10-5-15) requires state agency to disclose appraisal when one has been prepared as part of its statutory obligation to provide property owner with basis for computing amount of compensation offered would apply only to those eminent domain proceedings commencing after date of decision). There are two situations in which the reviewing court will consider prospectively applying a ruling that establishes a new principle of law: (1) the decision overrules clear past precedent on which litigants may have relied; or (2) the court decided an issue of first impression whose resolution was not clearly foreshadowed. 796 N.E.2d at 134. If either criterion is met, the court then considers whether, given the purpose and prior history of the rule, its operation will be retarded or promoted by prospective application and, further, whether prospective application is mandated by a balance of equities. Id. Be aware, though, that even when prospective application of the ruling is warranted, the holding of the court will still control the particular case in which the ruling is pronounced. 796 N.E.2d at 135. V. [13.14] PARTICULAR TYPES OF APPEALS The purpose of §§13.15 – 13.21 below is to address appeals in eminent domain cases other than appeals from the condemnation award. A. Interlocutory Appeals 1. [13.15] Appeal from Final Judgment Not Disposing of Entire Proceeding S.Ct. Rule 304(a) provides that if multiple parties or multiple claims for relief are involved in an action, an appeal may be taken from a final judgment as to one or more but fewer than all of the parties or claims only if the trial court has made an express written finding that there is no just reason for delaying either enforcement or appeal or both. When the condemnation suit is still pending and no award has been made, if the trial judge has not made the requisite finding, the appeal of an order that is not appealable absent a Rule 304(a) finding must be dismissed. Board of



Trustees of University of Illinois v. Timpone, 28 Ill.2d 255, 190 N.E.2d 786 (1963) (appeal of order dismissing cross-petition (now cross-complaint) of defendants and order denying petition for leave to intervene of defendants’ tenant dismissed due to lack of finding required under §50(2) of Civil Practice Act (now Rule 304(a))). See also City of Chicago v. Chicago Title & Trust Co., 197 Ill.App.3d 1062, 557 N.E.2d 311, 145 Ill.Dec. 541 (1st Dist. 1990) (order dismissing counterclaim of defendants against another defendant to determine counterclaimants’ right or status to share in final compensation disposes of only part of underlying controversy and, therefore, is not appealable absent Rule 304(a) finding). If, however, a judgment is not final, it is not appealable even if the court makes a S.Ct. Rule 304(a) finding. City of Vandalia v. Tate, 66 Ill.App.2d 488, 213 N.E.2d 787, 790 (5th Dist. 1966) (order denying traverse in non-quick-take condemnation was interlocutory, not final and appealable, despite trial court’s finding that there was no just reason for delaying enforcement or appeal of order, and, therefore, appeal was dismissed). The danger of challenging the taking in an action separate from the condemnation action and relying on the absence of a S.Ct. Rule 304(a) finding to put off taking an appeal from a final order in the separate proceeding is demonstrated in Kassnel v. Village of Rosemont, 135 Ill.App.3d 361, 481 N.E.2d 849, 90 Ill.Dec. 49 (1st Dist. 1985). The defendants filed a declaratory-judgment action seeking a determination that the proposed taking was unconstitutional and also filed a traverse and motion to dismiss in the condemnation action asserting the same grounds contained in the declaratory judgment action. After a consolidated evidentiary hearing, the court entered an order denying the traverse and motion to dismiss in the condemnation action and entered judgment on behalf of the condemnor in the declaratory judgment action. The declaratory judgment action remained a separate suit, and, therefore, the judgment was final and appealable when entered without a Rule 304(a) finding. Not only was the defendants’ appeal from the final order in the declaratory judgment action taken after the conclusion of the condemnation action dismissed as untimely, but principles of res judicata barred consideration of their challenge to the constitutionality of the taking in the appeal of the condemnation action.

PRACTICE POINTER

An order dismissing the condemnation complaint is not rendered a nonfinal order by the defendant’s filing of a petition for attorneys’ fees, costs, and expenses pursuant to Eminent Domain Act §10-5-70(a), 735 ILCS 30/10-5-70(a). City of Naperville v. Old Second National Bank of Aurora, 327 Ill.App.3d 734, 763 N.E.2d 951, 261 Ill.Dec. 702 (2d Dist. 2002). The order is therefore appealable without a finding pursuant to S.Ct. Rule 304(a).

2. [13.16] Interlocutory Appeal as of Right S.Ct. Rule 307(a)(7) permits an appeal as of right from an interlocutory order determining issues raised in quick-take proceedings. However, the provisions of Eminent Domain Act §20-5-10, 735 ILCS 30/20-5-10, govern an interlocutory appeal taken pursuant to Rule 307(a)(7).

APPEALS §3.16


Department of Transportation ex rel. People v. 151 Interstate Road Corp., 209 Ill.2d 471, 810 N.E.2d 1, 6, 284 Ill.Dec. 348 (2004). Section §20-5-10(b) specifically limits to three the issues that may be raised in such an appeal: (a) whether the condemnor has the authority to exercise the right of eminent domain; (b) whether the property sought to be taken is subject to the exercise of such a right; and (c) whether the right is being improperly exercised in the proceeding. Id.; Department of Public Works & Buildings v. Dust, 19 Ill.2d 217, 166 N.E.2d 36, 39 (1960). These are the three issues the trial court must first determine on a motion for immediate vesting of title. If the three issues are determined in favor of the condemnor, this amounts to a determination that the condemnor has authority to take the property by condemnation. Dust, supra, 166 N.E.2d at 39. The order entered on the court’s findings on the three §20-5-10(b) issues is final and appealable as soon as it is entered and remains appealable for 30 days thereafter unless the court, on good cause shown, extends the time for appealing. Id. If no appeal is taken from the order, the determination that the condemnor had authority to condemn may not be challenged in an appeal brought after a judgment is entered awarding just compensation following a jury verdict. Department of Public Works & Buildings of State of Illinois ex rel. People v. Exchange National Bank of Chicago, 40 Ill.App.3d 623, 356 N.E.2d 376, 380, 1 Ill.Dec. 250 (2d Dist. 1976). The provision of §20-5-10(b) as to finality and appealability is controlling. Dust, supra, 166 N.E.2d at 40. Therefore, 735 ILCS 5/2-1203(a), which provides for a motion for vacation or modification of a judgment within 30 days from the date of its rendition, is not applicable. Id. Under special circumstances, relief from the §20-5-10(b) order may be obtained pursuant to 735 ILCS 5/2-1401 more than 30 days after the entry thereof even if no appeal was taken. See Department of Public Works & Buildings of State of Illinois ex rel. People v. Vogt, 51 Ill.App.3d 770, 366 N.E.2d 310, 317, 9 Ill.Dec. 53 (5th Dist. 1977). If an interlocutory appeal is taken pursuant to S.Ct. Rule 307(a)(7) and EDA §20-5-10(b), the quick-take proceedings are not stayed unless the appeal is taken by the condemnor or an order staying further proceedings is entered either by the trial court or by the court to which appeal is taken. See Department of Transportation v. Sunnyside Partnership, L.P., 337 Ill.App.3d 322, 785 N.E.2d 1018, 1021, 271 Ill.Dec. 824 (5th Dist. 2003).

PRACTICE POINTERS

The Illinois Supreme Court agreed that the EDA requires the condemnor to negotiate with the landowner in good faith over the amount of compensation to be paid before it initiates proceedings to take the landowner’s property through eminent domain. 151 Interstate Road, supra, 810 N.E.2d at 7. Because good-faith negotiations with the landowner are a condition precedent to condemnation proceedings under the EDA, the question of whether a condemnor has negotiated in good faith bears directly on whether the condemnor is exercising its right of eminent domain improperly. Id. Therefore, the question of the condemnor’s good faith falls within the provisions of EDA §20-5-10(b)



and can be challenged by the landowner in an interlocutory appeal pursuant to S.Ct. Rule 307(a)(7). Id.

In quick-take proceedings, the trial court’s findings pursuant to EDA §20-5-10(c) that a

reasonable necessity exists for an immediate vesting of title and as to preliminary just compensation are interlocutory and appealable only at the conclusion of the eminent domain proceeding. Dust, supra, 166 N.E.2d at 40 – 41. These findings are not at issue in an interlocutory appeal pursuant to S.Ct. Rule 307(a)(7) even if they are included in the order containing the §20-5-10(b) findings. 166 N.E.2d at 39. From a practical standpoint, the landowner’s objections to the finding that a reasonable necessity exists for an immediate vesting of title and to the amount set for preliminary just compensation are moot once the preliminary just compensation is deposited, an order vesting title is entered, and the condemnor takes possession.

A landowner dissatisfied with the amount set for preliminary just compensation may,

nevertheless, apply to withdraw for his or her own use his or her share of the preliminary just compensation. 735 ILCS 30/20-5-20. Remember that withdrawing the preliminary just compensation does not estop the condemnee from later appealing the final just compensation award. Department of Transportation of State of Illinois ex rel. People v. Gass, 165 Ill.App.3d 562, 519 N.E.2d 90, 92, 116 Ill.Dec. 500 (5th Dist. 1988), overruled in part on other grounds by Illinois State Toll Highway Authority v. American National Bank & Trust Company of Chicago, 162 Ill.2d 181, 642 N.E.2d 1249, 1254, 205 Ill.Dec. 132 (1994). If authority to withdraw the preliminary just compensation is denied due to objection by the condemnor, interest must be paid from the date of the deposit to the date of payment. 735 ILCS 30/20-5-30(2). In addition, interest is paid on the excess of just compensation finally adjudged over the amount of preliminary just compensation set by the court in the quick-take proceeding from the date on which possession of the property was surrendered to the date of payment of such excess. 735 ILCS 30/20-5-30(1).

Arguably, the issue of whether a reasonable necessity exists for the taking of the property

by quick-take is an aspect of the third issue addressed under EDA §20-5-10(b), i.e., whether the right of eminent domain is being improperly exercised in this particular proceeding. The issue, therefore, should be addressed by the reviewing court if raised in an interlocutory appeal focused on alleged improprieties of the condemnor’s exercise of its right of eminent domain as was done by both the appellate court and the Supreme Court in Department of Transportation ex rel. People v. First Galesburg National Bank & Trust Co., 189 Ill.App.3d 797, 545 N.E.2d 770, 137 Ill.Dec. 117 (3d Dist. 1989), rev’d, 141 Ill.2d 462 (1990). But see Southwestern Illinois Development Authority v. National City Environmental, L.L.C., 304 Ill.App.3d 542, 710 N.E.2d 896, 898, 238 Ill.Dec. 99 (5th Dist. 1999) (issue of whether trial court erred in ruling that quick-take was appropriate without showing of immediate need is not appealable until conclusion of eminent domain proceeding), aff’d, 199 Ill.2d 225 (2002).

If no appeal is taken from the quick-take order, but a long period of time passes without

construction of the project commencing after the preliminary just compensation is

APPEALS §3.17


deposited and the court enters an order vesting title to the property in the condemnor, then the practitioner representing the landowner should review Vogt, supra, to determine whether relief is possible pursuant to Code of Civil Procedure §2-1401 through a petition to vacate the quick-take order or to dismiss the condemnation complaint.

An appeal pursuant to S.Ct. Rule 307(a)(7) does not open the door to a general review of the trial court’s proceedings up to the date of the order that is appealed. Southwestern Illinois Development Authority v. Vollman, 235 Ill.App.3d 32, 600 N.E.2d 926, 929, 175 Ill.Dec. 683 (5th Dist. 1992). For example, issues of constitutionality are not appealable until the conclusion of the eminent domain proceedings. 600 N.E.2d at 927 (attack on constitutionality of quick-take provisions of EDA); Southwestern Illinois Development Authority v. Al-Muhajirum, 318 Ill.App.3d 1005, 744 N.E.2d 308, 310 – 311, 253 Ill.Dec. 26 (5th Dist. 2001) (challenge of constitutionality of Southwestern Illinois Development Authority’s eminent domain power). But see City of Chicago v. Boulevard Bank National Ass’n, 293 Ill.App.3d 767, 688 N.E.2d 844, 854 – 855, 228 Ill.Dec. 146 (1st Dist. 1997) (appellate court, in interlocutory appeal brought pursuant to Rule 307(a)(7) and former Code of Civil Procedure §7-104 (now EDA §20-5-10), addressed defendants’ contention that quick-take provisions are unconstitutional special legislation). A challenge to the constitutionality of the condemnor’s conduct in the eminent domain proceeding is included within the issues appealable pursuant to Rule 307(a)(7) and §20-5-10(b) because it is not a challenge to the constitutionality of the condemnor’s eminent domain authority. National City Environmental, supra, 710 N.E.2d at 899. Other issues raised in quick-take proceedings but found not to be appealable prior to the determination of final compensation include a. a contention that the condemnor was required to include access rights in the

condemnation proceeding (Department of Public Works & Buildings of State of Illinois v. Association of Franciscan Fathers of State of Illinois, 3 Ill.App.3d 503, 278 N.E.2d 111, 113 (2d Dist. 1972) (contention is not within issue of condemnor’s authority or exercise of its authority of eminent domain)); and

b. a contention that the condemnor was acting in derogation of the former Freeway Act

(now 605 ILCS 5/8-106) by planning to close a highway crossing without a public hearing (id.).

3. [13.17] Interlocutory Appeal by Permission S.Ct. Rule 308 provides a mechanism through which appeal of an interlocutory order addressing a question of law may be possible. A two-step process is involved. First, the trial court must find that (a) the order involves a question of law as to which there is a substantial ground for difference of opinion and (b) an immediate appeal from the order may materially advance the ultimate termination of the litigation. These findings must be in writing, and the trial court must also identify the question of law involved. Second, the appellate court must grant leave to appeal. The appellate court’s review is limited solely to the question certified by the trial court.



Department of Transportation ex rel. People v. Parr, 259 Ill.App.3d 602, 633 N.E.2d 19, 21, 198 Ill.Dec. 557 (3d Dist. 1994). In addition, because the appeal involves only a question of law, the appellate court’s review is de novo. City of Chicago v. Midland Smelting Co., 385 Ill.App.3d 945, 896 N.E.2d 364, 375, 324 Ill.Dec. 578 (1st Dist. 2008). Permissive interlocutory appeals in eminent domain cases have involved such issues as a. the proper method of valuation (Department of Transportation, State of Illinois v. Kelley,

352 Ill.App.3d 278, 815 N.E.2d 1214, 287 Ill.Dec. 411 (3d Dist. 2004) (whether appraisers are allowed to value different portions of land separately in violation of unit rule); Department of Transportation v. HP/Meachum Land Limited Partnership, 245 Ill.App.3d 252, 614 N.E.2d 485, 185 Ill.Dec. 351 (2d Dist. 1993) (whether appraisers are allowed to testify to different highest and best uses for different areas of full tract); Department of Transportation of State of Illinois ex rel. People v. Toledo, Peoria & Western R.R., 59 Ill.App.3d 886, 376 N.E.2d 88, 17 Ill.Dec. 195 (3d Dist. 1978) (proper measure of damages for land taken when purpose of taking is solely to extract fill material), aff’d, 75 Ill.2d 436 (1979); People ex rel. Director of Finance v. Young Women’s Christian Association of Springfield, 59 Ill.App.3d 39, 375 N.E.2d 159, 16 Ill.Dec. 528 (4th Dist. 1978) (whether YWCA could introduce evidence of cost of replacing or reconstructing its facilities), rev’d, 74 Ill.2d 561 (1979), appeal after remand, 86 Ill.2d 219 (1981));

b. the admissibility of environmental remediation costs in determining the fair cash market

value of the subject property (Parr, supra, 633 N.E.2d at 20) (former Code of Civil Procedure §7-119 (now Eminent Domain Act §10-5-50, 735 ILCS 30/10-5-50) was subsequently amended to allow admission of evidence in trial on just compensation of any violation of any environmental law or regulation, its effect on fair market value of property, and reasonable cost of causing property to be placed in compliance with environmental laws and regulations);

c. the ability of a landowner to recover by counterclaim damages to the remainder due not

to the taking of a temporary easement but to changes in access to the remainder property (Department of Transportation ex rel. People v. Interstate Brands Corp., 251 Ill.App.3d 785, 623 N.E.2d 771, 191 Ill.Dec. 181 (4th Dist. 1993));

d. the ability of landowners to use an easement connecting their property to a public road to

develop the property sought to be condemned for commercial and residential purposes (Department of Transportation v. Smith, 100 Ill.App.3d 814, 427 N.E.2d 383, 56 Ill.Dec. 303 (5th Dist. 1981)); and

e. whether the condemnor has authority to condemn “less than the entire interests” of the

defendants as to certain land (Department of Conservation of State of Illinois ex rel. People v. Harold’s Farm, Inc., 68 Ill.App.3d 148, 385 N.E.2d 1097, 1100, 24 Ill.Dec. 807 (3d Dist. 1978)).

APPEALS §3.18


B. [13.18] Appeal from Order Relating to Traverse or Motion To Dismiss An order granting a traverse or motion to dismiss terminates the litigation and, therefore, is immediately appealable by the condemnor. In a non-quick-take condemnation, an order denying a traverse and motion to dismiss is not a final order. Village of River Forest v. Ash Realty Co., 23 Ill.App.3d 645, 321 N.E.2d 68, 70 (1st Dist. 1974). Such an order may be appealed only after a final judgment fixing compensation has been entered. Trustees of Schools of Township No. 42 ex rel. Board of Education of School District No. 57, Cook County v. Schroeder, 23 Ill.2d 74, 177 N.E.2d 178, 179 (1961). No motion for a new trial or its equivalent is necessary to preserve for review the question of whether the denial of the traverse and motion to dismiss was correct. City of Evanston v. Piotrowicz, 20 Ill.2d 512, 170 N.E.2d 569, 572 (1960). In a quick-take condemnation, an appeal from an order denying a traverse and motion to dismiss may be taken only as to the trial court’s findings relating to the three issues that may be raised in an interlocutory appeal pursuant to Eminent Domain Act §20-5-10(b), 735 ILCS 30/20-5-10(b), i.e., (1) whether the condemnor has the authority to exercise the right of eminent domain, (2) whether the property sought to be taken is subject to the exercise of such right, and (3) whether the right is being improperly exercised in the proceeding. Department of Transportation ex rel. People v. First Galesburg National Bank & Trust Co., 189 Ill.App.3d 797, 545 N.E.2d 770, 772, 137 Ill.Dec. 117 (3d Dist. 1989), rev’d, 141 Ill.2d 462 (1990). See §13.16 above for further guidance concerning the issues that can be raised in such an interlocutory appeal and the issues that are not appealable until after the termination of the eminent domain proceedings. In an appeal from an order relating to a traverse or motion to dismiss, if the issue under consideration is whether the condemnor has the authority to exercise the right of eminent domain, the standard of review is de novo. The power of any corporation (such as a county) or department of the government (such as the Illinois Department of Transportation) to exercise eminent domain must be specifically conferred by legislative enactment. County of De Kalb v. Smith, 213 Ill.App.3d 775, 572 N.E.2d 379, 380, 157 Ill.Dec. 310 (2d Dist. 1991). Whether a particular statute specifically confers the power of eminent domain is within the province of the court to decide as a question of law. The determination being a matter of law, the scope of review is independent of, not deferential to, the decision of the trial court. Id. Since the condemnor has only such powers of eminent domain as are conferred on it by the legislature, and the law conferring eminent domain authority must be strictly construed, the function of the appellate court is to determine whether the power of eminent domain is being exercised within the limits of the law. Department of Transportation of State of Illinois ex rel. People v. Callender Construction Co., 305 Ill.App.3d 396, 711 N.E.2d 1199, 1202 – 1203, 238 Ill.Dec. 538 (4th Dist. 1999). Other preliminary questions to be determined by the court that are raised in a traverse and motion to dismiss are reviewed under a manifest weight of the evidence standard. Village of Round Lake v. Amann, 311 Ill.App.3d 705, 725 N.E.2d 35, 43, 244 Ill.Dec. 240 (2d Dist. 2000); Trustees of Schools of Township No. 37 v. First National Bank of Blue Island, 49 Ill.2d 408, 274 N.E.2d 56, 58 (1971). For example, the manifest weight standard has been applied to a trial court’s finding that the condemnor acted in good faith in negotiation with the landowner.



Department of Transportation ex rel. People v. Hunziker, 342 Ill.App.3d 588, 796 N.E.2d 122, 128, 277 Ill.Dec. 407 (3d Dist. 2003). In addition, the credibility of the witnesses and the weight to be given to their testimony are to be determined by the court as the trier of fact, and its findings will not be disturbed unless they are manifestly against the weight of the evidence. First National Bank of Blue Island, supra, 274 N.E.2d at 58. A decision of the trial court is against the manifest weight of the evidence only if the opposite conclusion is clearly evident (City of Naperville v. Old Second National Bank of Aurora, 327 Ill.App.3d 734, 763 N.E.2d 951, 261 Ill.Dec. 702 (2d Dist. 2002)) or when its findings appear to be arbitrary, unreasonable, or not based on the evidence (City of Chicago v. Zappani, 376 Ill.App.3d 927, 877 N.E.2d 17, 22, 315 Ill.Dec. 530 (1st Dist. 2007)). C. [13.19] Appeal from Findings as to Rights of Parties Eminent Domain Act §10-5-70(a), 735 ILCS 30/10-5-70(a), provides, in part, that if the condemnor is not in possession pursuant to an order entered under the provisions of EDA §20-5-15, 735 ILCS 30/20-5-15, the court, upon the ascertainment of just compensation, shall have exclusive authority to hear and determine all rights in and to such just compensation and shall make findings as to the rights of the parties therein, except when the claimants are engaged in litigation in a court that acquired jurisdiction over the claimants with respect to their rights in the property taken prior to the filing of the condemnation complaint. Section 10-5-70(a) further provides that appeals may be taken from any findings by the court as to the rights of the parties in and to such compensation as in other civil cases. If the condemnor is in possession pursuant to an order entered under the provisions of EDA §20-5-15, the rights of parties in the property and the just compensation might be determined by the court when application is made pursuant to EDA §20-5-20, 735 ILCS 30/20-5-20, to withdraw preliminary just compensation. A judgment as to the rights of the parties made at that time is not appealable without a S.Ct. Rule 304(a) finding that there is no just reason for delaying either enforcement or appeal or both. See City of Chicago v. Chicago Title & Trust Co., 197 Ill.App.3d 1062, 557 N.E.2d 311, 145 Ill.Dec. 541 (1st Dist. 1990) (order dismissing counterclaim of defendants against another defendant to determine counterclaimants’ right or status to share in final compensation disposes of only part of underlying controversy and, therefore, is not appealable absent Rule 304(a) finding). D. [13.20] Appeal from Order Granting New Trial Pursuant to S.Ct. Rule 306(a)(1), a party may petition for leave to appeal from an order of the circuit court granting a new trial. When reviewing the grant of a new trial by the trial court, the issue before the reviewing court is not whether it would set aside the verdict on the record before it, but whether the trial court abused its discretion in setting aside the verdict. Department of Public Works & Buildings v. Russell, 28 Ill.2d 491, 192 N.E.2d 900, 903 (1963). In reviewing the grant of a new trial, the reviewing court will most likely be determining, directly or indirectly, whether the trial court abused its discretion in finding that there was a clear and palpable mistake, that the verdict was the result of passion or prejudice, or that there was an

APPEALS §3.21


erroneous ruling that might have misled the jury and amounted to prejudicial error. See Southern Illinois Airport Authority v. Smith, 267 Ill.App.3d 201, 641 N.E.2d 1240, 204 Ill.Dec. 621 (5th Dist. 1994); Trustees of Schools of Township No. 42 ex rel. Board of Education of School District No. 57, Cook County v. Schroeder, 23 Ill.2d 74, 177 N.E.2d 178 (1961).

PRACTICE POINTERS

If the petition for leave to appeal an order granting a new trial is granted, all rulings of the trial court on the posttrial motions are before the reviewing court without the necessity of a cross-petition. S.Ct. Rule 306(a).

A party that unsuccessfully petitioned for leave to appeal from the grant of a new trial

cannot, on appeal after the new trial, raise the issue that it was error for the trial court to set aside the verdict in the first trial. Department of Public Works & Buildings of State of Illinois ex rel. People v. Kelly, 40 Ill.App.3d 896, 353 N.E.2d 195, 207 – 208 (1st Dist. 1976).

A party who requests a new trial and receives it cannot claim on appeal after the new trial

that the order granting the new trial was error. Stephens v. Taylor, 207 Ill.2d 216, 797 N.E.2d 679, 682, 278 Ill.Dec. 84 (2003).

E. [13.21] Appeal from Consent Judgment Ordinarily, a consent judgment may not be appealed because it constitutes no more than the trial court’s recording of a settlement agreement reached by the parties and is not a judicial determination of their rights. City of Marseilles v. Radke, 287 Ill.App.3d 757, 679 N.E.2d 125, 127, 223 Ill.Dec. 181 (3d Dist. 1997). However, certain exceptions to the general rule are recognized. A court will vacate a consent judgment on the motion of only one party upon the showing of a fraudulent misrepresentation or coercion in the making of the agreement, the incompetence of one of the parties, gross disparity in the positions or capacities of the parties, errors of law apparent on the face of the record, or newly discovered evidence. Id. The appellate court in Radke determined that the lack of subject-matter jurisdiction also constitutes a sufficient basis on which to appeal a consent judgment. 679 N.E.2d at 128. In Radke, a consent judgment was entered when, prior to the hearing on the landowner’s motion to traverse and dismiss, negotiations resulted in an agreement between the parties. Within 30 days of the entry of the consent judgment, the landowner filed a motion to vacate the judgment, alleging that after entry of the consent judgment he discovered that the easement sought through condemnation was not within the legal description of the project redevelopment area, that the city therefore had no authority to acquire the easement by condemnation, and that the trial court thus lacked subject-matter jurisdiction to enter the consent judgment. 679 N.E.2d at 126 – 127. Determining that the lack of subject-matter jurisdiction may be a basis to vacate a consent judgment, the appellate court reversed the trial court’s denial of the landowner’s motion and remanded for an evidentiary hearing to determine whether the condemned easement was



within the boundaries of the tax increment financing district and, therefore, whether the trial court had the subject-matter jurisdiction necessary to enter any order. VI. [13.22] APPEAL TO ILLINOIS SUPREME COURT Usually, the only avenue of appeal to the Illinois Supreme Court for the practitioner whose client is dissatisfied with the result in the appellate court is a petition for leave to appeal pursuant to S.Ct. Rule 315. For guidance in preparing a petition for leave to appeal pursuant to Rule 315, see ILLINOIS CIVIL APPEALS: STATE AND FEDERAL (IICLE®, 2015). The purpose of §§13.23 – 13.25 below is to acquaint the eminent domain practitioner with other avenues of appeal to the Illinois Supreme Court that, although not often applicable, have been used in eminent domain cases.

PRACTICE POINTERS

S.Ct. Rule 315(b) should be carefully reviewed to ensure timely filing of the petition for leave to appeal to the Illinois Supreme Court. Amendment of the rule has done away with the requirement of filing an affidavit with the appellate court to secure a 35-day period in which to file the petition for leave to appeal. Id.

S.Ct. Rule 318(a) provides that, in all appeals, by whatever method, from the appellate

court to the Supreme Court, any appellee, respondent, or coparty may seek and obtain any relief warranted by the record on appeal without having filed a separate petition for leave to appeal or notice of cross- or separate appeal.

A. [13.23] Direct Appeal S.Ct. Rule 302 provides for appeals from final judgments of circuit courts taken directly to the Illinois Supreme Court. Under Rule 302(a), appeals are taken directly to the Supreme Court (1) in cases in which a statute of the United States or of Illinois has been held invalid and (2) in proceedings commenced under S.Ct. Rule 21(c) (proceedings to compel compliance with an administrative order of the chief circuit judge). In contrast to the mandatory direct appellate jurisdiction set forth in S.Ct. Rule 302(a), the Supreme Court may exercise discretionary appellate jurisdiction pursuant to Rule 302(b) “in a case in which the public interest requires prompt adjudication by the Supreme Court.” In an appropriate case, after the filing of the notice of appeal to the appellate court, the Supreme Court or a justice thereof may order that the appeal be taken directly to the Supreme Court. Such appeals are “direct” in the sense that after the notice of appeal is filed, upon the order of the Supreme Court or one of its justices, the appeal is transferred directly to the high court without further appellate proceedings. See People ex rel. Director of Finance v. Young Women’s Christian Association of Springfield, 86 Ill.2d 219, 427 N.E.2d 70, 55 Ill.Dec. 950 (1981).

APPEALS §3.24


S.Ct. Rule 302(b) does not set forth any specific procedures for obtaining direct appellate review, but the general practice is for one of the litigants to file a motion for direct appeal. See City of Carbondale v. Yehling, 96 Ill.2d 495, 451 N.E.2d 837, 71 Ill.Dec. 683 (1983) (appellant’s motion). B. [13.24] Certificate of Importance Under S.Ct. Rule 316, a losing party can request that the appellate court certify a question to the Supreme Court because the case “involves a question of such importance that it should be decided by the Supreme Court.” See Forest Preserve District of DuPage County v. West Suburban Bank, 161 Ill.2d 448, 641 N.E.2d 493, 204 Ill.Dec. 269 (1994) (issue was whether injunction granted to condemnor without quick-take authority that prevented landowner from excavating land that was subject of condemnation proceedings was unconstitutional taking under Illinois Constitution); Department of Public Works & Buildings v. Association of Franciscan Fathers of State of Illinois, 69 Ill.2d 308, 371 N.E.2d 616, 13 Ill.Dec. 681 (1977) (issue was whether trial court, when it determined there was sufficient evidence of likely change in zoning to permit valuation testimony based on reasonable probability of rezoning, had to give jury instruction allowing jury to consider reasonable probability of rezoning in reaching determination of just compensation); Department of Public Works & Buildings v. Klehm, 56 Ill.2d 121, 306 N.E.2d 1 (1973) (issue was whether contract for sale of land that was designated as installment contract to purchase and fixed purchase price in dollars, but gave vendor option of directing purchaser to buy second tract of land and exchange it for first tract, was contract for sale of land, not for exchange of land, and, as such, was admissible to show value of first tract). If the appellate court issues a certificate of importance, the Supreme Court is not confined to reviewing the issue the appellate court certified for review. However, the appellate court must first issue a decision before certifying a question, or the Supreme Court does not have jurisdiction over the question. See People ex rel. Director of Finance v. Young Women’s Christian Association of Springfield, 74 Ill.2d 561, 387 N.E.2d 305, 25 Ill.Dec. 649 (1979) (Supreme Court did not have jurisdiction over appellate court’s certified question because three members of appellate court expressed varying opinions). People v. Ortiz, 196 Ill.2d 236, 752 N.E.2d 410, 256 Ill.Dec. 530 (2001), overruled the declaration in Young Women’s Christian Association that the appellate court is to summarily affirm the judgment if the agreement of two judges in the district in which the appeal is brought cannot be obtained.

PRACTICE POINTER

If the appellate court certifies the question of importance, the Supreme Court must hear the question, and the losing party does not have to file a discretionary appeal to the Supreme Court under S.Ct. Rule 315. Due to filing deadlines, the party making application to the appellate court for a certificate of importance is well advised to include the request in a petition for rehearing. See S.Ct. Rule 316. This is a prudent approach because the application for a certificate of importance does not toll the time for filing a petition for leave to appeal pursuant to Rule 315, but the petition for rehearing does toll the time. Therefore, combining the application for certification with the petition for rehearing enables the petitioner to file a petition for a discretionary appeal if the appellate



court denies both the request for a rehearing and the request for a certificate of importance.

C. [13.25] Appeal as of Right S.Ct. Rule 317 provides for appeals to the Supreme Court as a matter of right when a question under the Constitution of the United States or of Illinois has arisen for the first time in the appellate court. See Southwestern Illinois Development Authority v. National City Environmental, L.L.C., 199 Ill.2d 225, 768 N.E.2d 1, 263 Ill.Dec. 241 (2002) (issue was whether Southwestern Illinois Development Authority’s use of power of eminent domain to take real property owned by one private landowner to convey to another private landowner was exercise of power of eminent domain for public use).

PRACTICE POINTER

An appeal pursuant to S.Ct. Rule 317 is initiated by filing a petition in the form prescribed by S.Ct. Rule 315, except that the petition is entitled “Petition for Appeal as a Matter of Right.” Leave to appeal pursuant to Rule 315 may be sought in the alternative, but the request therefor must be included in the same petition.

VII. [13.26] COSTS, EXPENSES, AND REASONABLE ATTORNEYS’ FEES In a non-quick-take condemnation, Eminent Domain Act §10-5-70(a), 735 ILCS 30/10-5-70(a), provides for three situations in which the landowner is entitled to recover all costs, expenses, and reasonable attorneys’ fees paid or incurred in defense of the complaint: (a) if the condemnor dismisses the complaint before the entry of an order that the condemnor shall enter upon the subject property and use of it upon payment of full compensation as ascertained; (b) if the condemnor fails to make payment of full compensation within the time fixed in such order; or (c) if the final judgment is that the condemnor cannot acquire the property by condemnation. In a condemnation case that terminates in one of the three ways specified in §10-5-70(a), whether the condemnee’s recovery will include the costs, expenses, and reasonable attorneys’ fees incurred in relation to an appeal prosecuted in the course of the condemnation proceedings does not depend on whether the condemnor or the condemnee takes the appeal. Village of Cary v. Trout Valley Ass’n, 297 Ill.App.3d 63, 696 N.E.2d 1154, 1157 – 1158, 231 Ill.Dec. 583 (2d Dist. 1998). If the condemnor takes the appeal, the condemnee is entitled to the costs, expenses, and reasonable attorneys’ fees associated with the appeal because it was compelled to defend beyond the trial court. Department of Public Works & Buildings v. Lanter, 15 Ill.2d 33, 153 N.E.2d 552, 556 (1958). If the condemnee takes the appeal, in deciding whether it can recover its costs, expenses, and

APPEALS §3.27


reasonable attorneys’ fees associated with the appeal, “the critical inquiry is whether the appeal was taken ‘in defense of the complaint.’ ” Trout Valley, supra, 696 N.E.2d at 1158, quoting former 735 ILCS 5/7-123(a) (now 735 ILCS 30/10-5-70(a)). Thus, if the condemnee appealed to obtain a larger money judgment and the condemnor subsequently abandons the condemnation or fails to timely pay full compensation, the condemnee is not entitled to its costs, expenses, and reasonable attorneys’ fees associated with the appeal because it was not compelled to defend beyond the trial court. Lanter, supra, 153 N.E.2d at 555 – 556. See also Commissioners of Lincoln Park v. Schmidt, 395 Ill. 316, 69 N.E.2d 869 (1946); Forest Preserve Dist. of Cook County v. Kean, 303 Ill. 293, 135 N.E. 415 (1922). However, a condemnee appealing from an erroneous denial of a motion to dismiss is compelled to defend beyond the trial court and, therefore, is entitled to recover all costs, expenses, and reasonable attorneys’ fees incurred in prosecuting the appeal. Trout Valley, supra, 696 N.E.2d at 1158. In a quick-take condemnation, EDA §20-5-45, 735 ILCS 30/20-5-45, provides for three situations in which the condemnee is entitled to recover costs, expenses, and attorneys’ fees: (a) if, on an appeal taken under the provisions of EDA §20-5-10(b), 735 ILCS 30/20-5-10(b), the condemnor is determined not to have the authority to maintain the proceedings as to any property that is the subject thereof; (b) if, with the consent of all parties to the proceeding whose interests are affected, the condemnor dismisses the complaint; or (c) if, with the consent of all parties to the proceeding whose interests are affected, the condemnor abandons the proceedings as to any of the subject property. Section 20-5-45 provides that the recovery of costs, expenses, and attorneys’ fees shall be as provided in EDA §10-5-70. Therefore, the circumstances in which the condemnee’s recovery will include the costs, expenses, and reasonable attorneys’ fees incurred in relation to an appeal prosecuted in the course of the quick-take condemnation proceedings are as outlined above.

PRACTICE POINTER

A petition for attorneys’ fees pursuant to EDA §10-5-70(a) does not attack the judgment in the condemnation action and, therefore, is not considered a postjudgment motion for purposes of 735 ILCS 5/2-1203. City of Naperville v. Old Second National Bank of Aurora, 327 Ill.App.3d 734, 763 N.E.2d 951, 261 Ill.Dec. 702 (2d Dist. 2002); Town of Libertyville v. Bank of Waukegan, 152 Ill.App.3d 1066, 504 N.E.2d 1305, 1309 – 1310, 105 Ill.Dec. 787 (2d Dist. 1987). Consequently, a petition for attorneys’ fees filed within 30 days of the entry of the order dismissing the condemnation action does not nullify the effect of a previously filed notice of appeal of the condemnor. Old Second National Bank, supra, 763 N.E.2d at 955. However, although the general rule is that the filing of a notice of appeal divests the trial court of jurisdiction, since the matter is collateral or incidental to the judgment, the trial court retains jurisdiction to consider the petition for attorneys’ fees. Town of Libertyville, supra.

VIII. [13.27] CONCLUSION The appeal of an eminent domain proceeding is in most respects like the appeal of other types



of civil cases. There are, however, issues that are unique to eminent domain appeals, such as waiver of the right to appeal, standards of review, possession of the property pending appeal, interest, and interlocutory appeals. The eminent domain practitioner must carefully consider these issues in prosecuting or defending an eminent domain appeal.

ILLINOIS INSTITUTE FOR CONTINUING LEGAL EDUCATION a — 1

Index

References in this index are to section number. Abandonment,

appeals, 13.4 in federal practice, 11.50 interest on abandoned property,

5.42 of complaint, 2.70 quick-take, 4.29 trial, 1.29

Access, valuation of property in partial

takings, 7.50

Admissibility of evidence, collateral evidence, 8.15 comparable-sales approach, 8.16

Wilson v. Clark, 8.32 demonstrative evidence,

existing conditions, depicting, 8.34

proposed highest and best use, depicting, 8.35

environmental conditions, demonstrative evidence of, 12.38 – 12.44

contour maps, 12.43 photographs, 12.42 plats and plans, 12.39 – 12.41 post-filing development plans,

12.41 prefiling development plans,

12.40

Admissibility of evidence (cont.), environmental conditions (cont.),

public records, 12.44 wetland delineations, 12.43

offers, 8.31 opinion testimony of appraisers,

7.11 purchase price, 8.30 similarity of sales, 8.20 – 8.29

assemblage sales, 8.20 date of sale, 8.28 highest and best use, 8.29 improved versus unimproved

properties, 8.26 proximity, 8.22 size, 8.23 subdivision property, 8.27 utilities, 8.24 zoning, 8.25

substandard or illegal environmental conditions, 12.37

substantive evidence of sales, 8.33 voluntary transactions, 8.17 – 8.19

for cash, 8.19 voluntariness, 8.18

Advance acquisition, notice of, 2.30

Aeronautics Act (Illinois), airports and, 5.29

Affidavits, as to unknown owners, 2.79 for publication, 2.78

Agriculture Department (Illinois), precondemnation procedure, 2.7

Agriculture Department (U.S.), contour maps, 12.43

Air Installations Compatible Use Zones,

federal practice and, 11.13

Airports, inverse condemnation, 5.29

Amendments to complaints, in federal practice, 11.38 overview, 2.69

American Institute of Real Estate Appraisers,

fair market value, 7.8 special-use property, 7.39 overview, 2.4

American Right of Way Association,

precondemnation procedure and, 2.4

AME ILLINOIS EMINENT DOMAIN PRACTICE

a — 2 WWW.IICLE.COM

American Society of Appraisers, precondemnation procedure and,

2.4

Answers, in federal practice, 11.36, 11.71 overview, 1.15

Appeals, abandonment, 13.4 attorneys’ fees, 13.26 Code of Civil Procedure §2-1401,

13.12 constitutional issues, 13.4, 13.16,

13.25 continuances, 13.4 court costs and expenses, 13.26 discovery, 13.4 error versus no error, 13.6 evidence, 13.2, 13.4 expert witnesses, 13.4 from consent judgment, 13.21 from findings as to rights of

parties, 13.19 from new trial order, 13.20 from traverse orders, 3.15, 13.18 from valuation of property, 7.7 harmless error doctrine, 7.7 interest, 13.11 interlocutory appeals,

as of right, 13.16 by permission, 13.17 from final judgment not

disposing of entire action, 13.15

jury instructions, 13.4 just compensation, 13.4 motions in limine, 13.4 no error, 13.6, 13.7 nonreversible error, 13.8 overview, 13.1, 13.27 plain error doctrine, 13.2 possession pending, 13.10 preservation of error for review,

13.2 pretrial appeals, 6.38 prospective application, 13.13 questions of law, 13.4 quick-take,

dismissal on, 4.27 issues, 4.25 stay pending, 4.26

reversible error, 13.9 standards of review, 13.4 time requirements, 13.5 to Supreme Court, 13.22 – 13.25

as of right, 13.25 certificate of importance,

13.24 direct appeal, 13.23

Appeals (cont.), types of, 13.14 – 13.21 verdicts, 13.4 waiver of right to, 13.3

Appearance, forms, 11.72 in federal practice, 11.36

Appraisal Foundation, environmental law, appraisal

standards, 12.45 federal practice and, 11.8 precondemnation procedure and,

2.4

Appraisal Institute, complaints and, 2.56 precondemnation procedure and,

2.4

Appraisal Standards Board, environmental law, appraisal

standards, 12.45 precondemnation procedure and,

2.4

Appraisers, as expert witnesses, 3.22, 7.9 bases of opinions, 7.10 environmental law, appraisal

standards, 12.45 fair market value, proving by

opinion testimony, 7.8 – 7.12 admissibility of, 7.11 bases of opinions of

appraisers, 7.10 expert witnesses, appraisers

as, 7.9 gatekeeper role of trial judges,

7.12 reasonable reliance on facts

and data, 7.11 hiring of, 2.4, 2.16

Appreciation, fair market value, exclusion from,

7.28

Assemblage sales, similarity of sales, admissibility

of, 8.20

Attempts to agree on compensation, acquisition by agreement, 2.45 alternate acquisition by purchase

of mortgage or other lien rights, 2.47

as condition precedent to action, 2.34

Attempts to agree on compensation (cont.), binding nature of statements of

public officials, 2.48 condemnation following

unsuccessful negotiation, 2.35 conferences with defendants, 2.39 forms, 2.38 good-faith offer, 2.44

forms, 2.80 multiple owners, incompetents

and nonresidents, 2.42 offers, persons entitled to submit,

2.36 reasonableness of amount, 2.44 standards, 2.43 termination of negotiations, 2.40 testing sufficiency, 2.37 traverse and motion to dismiss,

lack of as grounds for, 1.19, 3.9 voluntary conveyance, 2.46 waiver, 2.41

Attorneys, specialization in eminent domain,

8.2

Attorneys’ fees, appeals, 13.26 overview, 2.1 pretrial discussion, 6.2 valuation of property, 7.21

Authority to exercise eminent domain,

as condition precedent to action, 1.8, 2.17

delegation of authority, 2.17 federal agencies, 11.6 governing law, 11.7 Illinois statutes, 1.39 in federal practice, 11.2 – 11.13 leasehold interests, 10.2 limitations on,

Air Installations Compatible Use Zones, 11.13

just compensation as, 11.9 necessity as, 11.11 overview, 1.2 public use as, 11.10 temporary takings, 11.12

local governments, 1.5 sources of, 1.2 State, 1.4 traverse and motion to dismiss,

lack of as grounds for, 1.17, 3.10

Uniform Relocation Assistance and Real Property Acquisitions Policies Act of 1970 (U.S.), 11.8

INDEX COM


Authority to exercise eminent domain (cont.),

utilities, 1.6 when exercised, 11.5

Automatic termination clauses, 10.23, 10.24

Billboards,

fair market value, 7.38 inverse condemnation, 5.43

Bills of particulars, 6.33 Bonus value,

leasehold interests, valuation of property, 10.16

Brownfields Revitalization and

Environmental Restoration Act of 2001 (U.S.),

environmental liability and, 12.8

Burden of proof, in federal practice, 11.39 leasehold interests, valuation of

property, 10.12

Business Development and Redevelopment Law (Illinois),

urban redevelopment, eminent domain and, 1.36

Business income approach,

valuation of property in federal practice, 11.21

Case management conferences, 6.36 Casinos,

inverse condemnation, 5.39

Cautionary instructions, jury trials, 8.42

Chicago, quick-take in, 1.37

Cities see Non-state entity eminent

domain proceedings

Civil Practice Act (Illinois), quick-take and, 4.9

Civil Practice Act (Illinois — former),

appeals, 13.15

Civil Rights Act of 1871 (U.S.), billboards and, 5.43

Clean Air Act (U.S.), environmental liability and, 12.4,

12.13

Clean Water Act (U.S.), environmental law and,

environmental liability, 12.4, 12.14

property development, 12.21 valuation of property and, 12.34

Clerks of Courts Act (Illinois), complaints and, 2.68

Closing arguments, overview, 8.47 right to open and close, 3.18, 8.40

motions, 3.26

Code of Civil Procedure (Illinois), appeals,

Code of Civil Procedure §2-1401, 13.12

interest, 13.11 interlocutory appeals, 13.16 preservation of error for

review, 13.2 reversible error, 13.9

applicability of, 8.3 former eminent domain law in,

1.3, 2.1, 7.4, 10.21, 12.1, 12.31, 12.37

traverse and motion to dismiss and, 6.3

valuation of property and, 7.5, 7.14

Code of Federal Regulations (U.S.),


Collateral evidence, 8.15 Commerce Commission (Illinois),

approval as condition precedent to action, 2.25

immediate right of entry by necessity and, 2.71

quick-take and, 4.5 statement of authority, 2.54 statement of necessity, 2.56 traverse and motion to dismiss,

lack of approval as grounds for, 1.20

utilities, authority over, 1.6, 1.11

Commissions, federal practice and, 11.44

Common elements, complaints, 1.12

Comparable-sales approach, admissibility of evidence, 8.16

Wilson v. Clark, 8.32 environmental conditions, effect

of, 12.33 – 12.36 dissimilar environmental

conditions, 12.36 estimated costs, use of, 12.35 sales of equally affected

properties, 12.34 in federal practice, 11.17 leasehold valuation, 10.19 overview, 7.24

Compensation see Just compensation

Compensation clauses, leasehold interests, 10.24

Complaints, abandonment, 2.70 amendments, 2.69

in federal practice, 11.38 answers, 1.15

in federal practice, 11.36, 11.71

common elements, 1.12 compensation, failure to agree on,

2.58 contents of, 1.10 cross-petitions, 1.15 dismissal, 2.70 elements of, 2.50 – 2.62 guardians ad litem, motions for

appointment of, 2.67 immediate right of entry by

necessity, 2.71 in federal practice, 11.34, 11.69 interest sought, description of,

2.60 jury demand, 2.61 lis pendens, 1.14, 2.68

forms, 2.77 names, 2.51 necessary defendants, 2.52 necessity, 2.57 overview, 2.2 prayer for relief, 2.62 property sought, description of,

2.59 purpose, 2.49 replacement property, 2.57 resources, 2.72 service of process, 1.13

by publication, 2.64

COM ILLINOIS EMINENT DOMAIN PRACTICE


Complaints (cont.), service of process (cont.),

excusing, 2.66 special process servers, 2.65 summons, 2.65

statement of authority, 2.54 statement of necessity, 2.56 statement of purpose, 2.55 summons, 2.63

service of process, 2.65 traverse and motion to dismiss

see Traverse and motion to dismiss

unknown owners, 2.53 utilities, 1.11

Comprehensive Environmental Response, Compensation, and Liability Act (U.S.),

defenses, 12.8 liabilities, 12.5

extent of financial liabilities, 12.6

overview, 12.4, 12.10, 12.12 private cost recovery actions, 12.7 valuation of property and, 12.33

Condemnation clauses, effect of, 10.3 forms, 10.23

Condemnee procedures, caselaw, 3.21 counterclaims, 3.17, 3.25 early discovery, 3.3 expert witnesses, motions, 3.20 initial considerations, 3.2 overview, 3.1, 3.22 production of witnesses and

documents, motions, 3.23 right to open and close, 3.18

motions, 3.26 traverse and motion to dismiss


views of property, 3.19 motions, 3.27

Condemnor procedures, advance acquisition, notice of,

2.30 appraisers, hiring, 2.4 attempts to agree on

compensation see Attempts to agree on

compensation complaints see Complaints

Condemnor procedures (cont.), conditions precedent to actions

see Conditions precedent to actions

due-process rights prior to site selection or enactment of condemnation authority, 2.10

environmental assessments, 2.9 inspection of property,

personal inspection, 2.5 prefiling inspection, 2.33

intergovernmental cooperation, 2.27

military personnel, 2.12 municipal acquisition of public

property, 2.28 occupants, identification of, 2.11 overview, 2.2 owners, contacts with, 2.31 parties, identification of, 2.6 preliminary considerations, 2.3 preservation of status quo during

pendency of action, 2.29 pretrial procedure, 6.17 records of conversations, 2.32 relocation assistance,

coordinator, 2.14 reimbursement for, 2.13 Uniform Relocation

Assistance and Real Property Acquisitions Policies Act of 1970, 2.16

resources, 2.72 right-of-way designation, notice

of, 2.30 60-day notice letters, 2.15 statutes, compliance with, 2.7 surveys, 2.8

Conditions precedent to actions, attempts to agree on

compensation, 2.34 authority, 1.8, 2.17 availability of funds, 2.21 Commerce Commission approval,

2.25 delay, effect of, 2.24 final project plans, 2.22 necessity, 1.8 negotiation, 1.9 overview, 1.7 prior notice, 2.23 public purpose, 1.8 quick-take, 2.19 railroads, 2.26 successive condemnations, 2.18 utilities, 2.25

Condominium Property Act (Illinois),

complaints, 1.12

Consent judgments, appeals from, 13.21

Consequential damages, in federal practice, 11.27 leasehold interests, valuation of

property, 10.20

Consolidation of trials, 8.4 Constitution (Illinois),

appeals, 13.25 as source of authority to exercise

eminent domain, 1.2, 1.4 environmental law and, 12.1 home-rule authority, 5.33 inverse condemnation and, 5.24,

5.25, 5.29, 5.39, 9.2, 9.9, 9.10 jury trials, 8.6 just compensation, 7.20 mandamus and, 9.2 – 9.5 notice requirements, 5.35 precondemnation procedure and,

2.2, 2.24, 2.35 quick-take, 1.37, 4.3, 4.22 relocation assistance, 1.38 urban redevelopment, 1.36 valuation of property,

as source of rules, 7.3 date of, 6.30, 7.14 historical background, 7.2 in partial takings, 7.40 making owner whole, 10.12 overview, 7.1 unit rule, 7.17 unsightliness, 7.49

Constitution (U.S.), as source of authority to exercise

eminent domain, 11.1, 11.2 leasehold interests, 10.2

federal practice and, jury trial, 11.43 overview, 11.2 takings, 11.4 Tucker Act, 11.51 valuation of property, 11.14,

11.27 inverse condemnation and, 5.24,

5.25, 5.29, 5.39, 9.8 notice requirements, 5.35 overview, 8.3 valuation of property and,

fair market value, 7.13

INDEX DRI


Constitution (U.S.) (cont.), valuation of property and (cont.),

interest, 7.20 making owner whole, 10.12 overview, 7.2 unit rule, 7.17

Consultants, valuation of property, selection of

consultants, 6.19

Continuances, appeals, 13.4

Contour maps, environmental conditions, 12.43

Cook County, default judgments in, 2.12

Cost approach, valuation of property, 7.25

Cost to cure, valuation of property in partial

takings, 7.46

Counterclaims, condemnee procedures, 3.17, 3.25

Counties see Non-state entity eminent

domain proceedings

Court costs and expenses, appeals, 13.26 in federal practice, 11.46 – 11.49

Equal Access to Justice Act, 11.47

Federal Rules of Civil Procedure, 11.49

42 U.S.C. §4654(a), 11.48 valuation of property, 7.21

Court of Claims Act (Illinois), actions for money damages and,

9.7 counterclaims, 3.17 mandamus and, 9.4

Cross-complaints, leasehold interests, 10.29

Cross-examination, of expert witnesses, 7.19

Cross-petitions, overview, 1.15

Cross-petitions (cont.), property damage, 6.32 valuation of property in partial

takings, 7.41

Damages, consequential damages, 11.27 valuation of property in partial

takings, access, 7.50 cost to cure, 7.46 improper elements, 7.51 noise, 7.48 proper elements, 7.45 – 7.50 reduction in size, 7.47 unsightliness, 7.49

Daubert test, valuation of property, 7.12

Declaration of Taking Act (U.S.), federal practice and, 11.30, 11.31

Declarations of taking, forms, 11.65

order for distribution, 11.67 petition for distribution of

deposit, 11.66 petition of owners for

payment, 11.68 inverse condemnation, 11.29 overview, 11.30

Defense Department (U.S.), Air Installations Compatible Use

Zones, 11.13

Defenses, in federal practice, 11.37

Definitional instructions, jury trials, 8.43

Delegation of authority, precondemnation procedure, 2.17

Demonstrative evidence, existing conditions, depicting,

8.34 of environmental conditions,

12.38 – 12.44 contour maps, 12.43 photographs, 12.42 plats and plans, 12.39 – 12.41 post-filing development plans,


12.40 public records, 12.44 wetland delineations, 12.43

Demonstrative evidence (cont.), proposed highest and best use,

depicting, 8.35

Depositions, 6.27 Deposits,

overview, 1.32 withdrawal of, 1.34

Depreciation, fair market value, exclusion from,

7.28

Discovery, appeals, 13.4 depositions, 6.27 early discovery, 3.3 facts or documents, 1.22 in federal practice, 11.40 interrogatories,

service of process, 6.11 Supreme Court Rules, 6.24 use of, 6.26

outline, 6.28 overview, 1.21 quick-take, 4.20 Supreme Court Rules, 6.23

additional discovery, 6.25 witnesses, 1.23

Dismissal, in federal practice, 11.38 non-state entity eminent domain

proceedings, noncompliance with law resulting in, 5.15

of complaints, 2.70 quick-take, 4.29

dismissal on appeal, 4.27 traverse and motion to dismiss


Disposals,


District courts, federal practice and, 11.45

Districts see Non-state entity eminent

domain proceedings

Downzoning, inverse condemnation, 5.25

Driveways, non-state entity eminent domain

proceedings, 5.46

DUE ILLINOIS EMINENT DOMAIN PRACTICE


Due Process Clause (U.S.), overview, 1.2 owner rights prior to site selection

or enactment of condemnation authority, 2.10

Early discovery,

condemnee procedures, 3.3

Easements, non-state entity eminent domain

proceedings, 5.45 valuation of property,

permanent easement, 7.53 temporary easement, 7.54

Ejectment, as remedy of interest holders,

11.53

Eleventh Amendment (U.S.), environmental law, property

development, 12.23

Emergency Management Agency (Illinois),

underground storage tanks and, 12.10

Eminent Domain Act (Illinois),

overview, 1.3, 2.1, 8.3

Eminent Domain Act of 1872 (Illinois — former),


Eminent Domain Act of 1972

(Illinois — former), valuation of property and, 7.14

Encumbrances, research of, 6.31

Endangered Species Act of 1973 (U.S.),

environmental law, property development, 12.23

Environmental law,

appraisal standards, 12.45 CERCLA,

defenses, 12.8 extent of financial liabilities,

12.6 liabilities, 12.5 overview, 12.4, 12.10, 12.12 private cost recovery actions,

12.7 valuation of property and,

12.33

Environmental law (cont.), Clean Air Act, 12.13 Clean Water Act, 12.14 comparable-sales approach, effect

of environmental conditions on, 12.33 – 12.36

dissimilar environmental conditions, 12.36

estimated costs, use of, 12.35 sales of equally affected

properties, 12.34 demonstrative evidence, 12.38 –

12.44 contour maps, 12.43 photographs, 12.42 plats and plans, 12.39 – 12.41 post-filing development plans,


12.40 public records, 12.44 wetland delineations, 12.43

development, laws constraining, 12.15 – 12.24

Endangered Species Act, 12.23 environmental assessments, 2.9 environmental impact statements,

11.37, 12.22 Fish and Wildlife Coordination

Act, 12.24 floodplain and floodway

regulation, 12.16 – 12.20 federal laws, 12.18 local regulation, 12.20 National Flood Insurance Act,

12.17 state regulation, 12.19

Hazardous Substance Cleanup Program, 12.4

highest and best use, 12.29 – 12.32

costs to alleviate environmental conditions, evidence of, 12.31

environmental conditions, evidence of, 12.30

government action, dependent on, 12.32

historical development, 12.2 inspection of property,

county as condemnor, 12.26 post-filing inspection, 12.28 prefiling inspection, 12.25 –

12.27 state as condemnor, 12.27

liabilities, laws imposing, 12.3 – 12.14

National Environmental Policy Act, 12.22

Environmental law (cont.), RCRA,

financial responsibility requirements, 12.11

overview, 12.4, 12.9, 12.12 underground storage tank

regulation, 12.10 relationship with eminent domain,

12.1 substandard or illegal conditions,

admissibility of, 12.37 Toxic Substances Control Act,

12.12 Underground Storage Tank Fund,

12.11 valuation of property,

environmental issues, 7.35 wetlands regulation, 12.21

Environmental Protection Act (Illinois),

pretrial procedure and, 6.14

Environmental Protection Agency (Illinois),

environmental liability and, 12.2, 12.9, 12.14

valuation of property and, 12.32

Environmental Protection Agency (U.S.)

see Environmental law

Equal Access to Justice Act (U.S.), federal practice and, 11.47

Evidence, admissibility of

see Admissibility of evidence appeals, 13.2, 13.4 at trial, 1.27 collateral evidence, 8.15 demonstrative evidence

see Demonstrative evidence discovery

see Discovery motions in limine, 6.35 views of property as, 8.12

Exchanges, federal practice and, 11.63

Expenses see Court costs and expenses

Expert witnesses, appeals, 13.4 appraisers as, 3.22, 7.9 cross-examination of, 7.19 Daubert test, 7.12

INDEX FIF


Expert witnesses (cont.), Frye test, 7.12 jury instructions, 8.46 motions by condemnee, 3.20

Fair Housing Act (U.S.), private owners, transfers between,

5.21

Fair market value, billboards, 7.38 comparable-sales approach

see Comparable-sales approach

cost approach, 7.25 determination of, 7.23 – 7.26 exclusions from, 7.27 – 7.34

appreciation or depreciation caused by project, 7.28

business done on property, 7.30

existing rights-of-way, 7.34 illegal use, 7.29 relocation costs, 7.31 replacement costs, 7.33 taxation, 7.32

farm property, 7.36 income approach, 7.26 just compensation as, 7.13 market approach

see Comparable-sales approach

minerals, 7.36 opinion testimony of appraisers,

proving by, 7.8 – 7.12 admissibility of, 7.11 bases of opinions of

appraisers, 7.10 expert witnesses, appraisers



and data, 7.11 subdivision property, 7.37 timber, 7.36

Farm property, fair market value, 7.36

Farmland Preservation Act (Illinois),


Federal Emergency Management

Agency (U.S.), floodplains and floodways,

regulation of, 12.17, 12.44

Federal Home Loan Mortgage Corporation (U.S.),

floodplains and floodways, regulation of, 12.17

Federal National Mortgage

Association (U.S.), floodplains and floodways,

regulation of, 12.17

Federal practice, abandonment in, 11.50 amendments to complaints in,

11.38 answers in, 11.36, 11.71 appearance in, 11.36 authority to exercise eminent

domain, 11.2 – 11.13 burden of proof in, 11.39 comparable-sales approach in,

11.17 complaints in, 11.34, 11.69 consequential damages in, 11.27 court costs and expenses in, 11.46

– 11.49 Equal Access to Justice Act,

11.47 Federal Rules of Civil

Procedure, 11.49 42 U.S.C. §4654(a), 11.48

declarations of taking see Declarations of taking

defenses in, 11.37 discovery in, 11.40 dismissal in, 11.38 disposals, 11.64 ejectment, 11.53 exchanges, 11.63 highest and best use in, 11.19 injunctions, 11.52 inverse condemnation in, 11.29 joinder of properties in, 11.33 jurisdiction in, 11.32 jury trials in, 11.43 objections in, 11.37 overview, 11.1 procedure, 11.31 – 11.50 relocation assistance, 11.55 –

11.61 revestments, 11.62 service of process in, 11.35 substitution of parties in, 11.38 trespass, 11.54 trials in, 11.41 – 11.45

commissions, 11.44 district courts, 11.45 jury trials, 11.43 tribunals, 11.42

Tucker Act, 11.51

Federal practice (cont.), valuation of property, 11.14 –

11.28 venue in, 11.32 what constitutes taking, 11.4

Federal Property and Administrative Services Act of 1949 (U.S.),


Federal Rules of Civil Procedure (U.S.),

answers, 11.36 applicability in federal practice,

11.31 attorneys’ fees, 2.1, 7.21 complaints, 11.34

amendments, 11.38 court costs and expenses, 11.49 discovery, 11.40 dismissal, 11.38 opinion testimony, 6.18 service of process, 11.35 substitution of parties, 11.38 trials, 11.45

just compensation, 11.41 – 11.44

Federal Rules of Evidence (U.S.),

appraisers and, as expert witnesses, 7.9 – 7.12 hiring, 3.22

cross-examination of expert witnesses, 7.19, 7.37

discovery, 3.3 expert witnesses, 8.31, 8.32 fair market value and,

comparable-sales approach, 7.24

income approach, 7.26 gatekeeper role of trial judges,

7.12 purchase offers, admissibility of,

6.7 valuation of property,

as source of rules, 7.6 witnesses, 10.17

Fifth Amendment (U.S.), complaints and, 257 condemnee procedures and, 3.21 Due Process Clause, 1.2 environmental law and, 12.1 federal practice and,

overview, 11.2 takings, 11.4 valuation of property, 11.14,

11.27 inverse condemnation and, 5.24,

5.25

FIF ILLINOIS EMINENT DOMAIN PRACTICE


Fifth Amendment (U.S.) (cont.), Just Compensation Clause, 7.14,

11.14, 11.27 leasehold interests and, 10.2, 10.3 overview, 8.3 precondemnation procedure and,

2.1, 2.24, 2.30 Takings Clause, 11.4 valuation of property and,

fair market value, 7.13 interest, 7.20 overview, 7.2 special-use property, 7.39 unit rule, 7.17

Financial and Professional Regulation Department (Illinois),

appraisal standards, 12.45

Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (U.S.),


First-contact letter,

complaints, 2.73

Fish and Wildlife Coordination Act (U.S.),


Flooding,

inverse condemnation, 5.26, 9.10

Floodplain and floodway regulation, federal laws, 12.18 local regulation, 12.20 National Flood Insurance Act,

12.17 overview, 12.16 state regulation, 12.19

Foreclosures, inverse condemnation, 5.30

Forest preserves, non-state entity eminent domain

proceedings, 5.45

Forms, affidavits,

as to unknown owners, 2.79 for publication, 2.78

attempts to agree on compensation, 2.38

complaints, 2.76 declarations of taking, 11.65

order for distribution, 11.67

Forms (cont.), declarations of taking (cont.),

petition for distribution of deposit, 11.66

petition of owners for payment, 11.68

first-contact letter, 2.73 good-faith offers, attempts to

agree on compensation, 2.80 inspection of property, requests,

2.75 lis pendens, 2.77 60-day notice letters, 2.74

Fourteenth Amendment (U.S.), inverse condemnation and, 5.25 leasehold interests and, 10.2 states, applicability to, 1.2, 7.2

Freedom of Information Act (Illinois), 6.28

Frye test,

valuation of property, 7.12

Gasoline Storage Act (Illinois), environmental liability and, 12.10

Gatekeeper role of trial judges, valuation of property, 7.12

Good-faith offers, attempts to agree on

compensation, 2.44 forms, 2.80

Guardians ad litem, motions for appointment of, 2.67

Harmless error doctrine, valuation of property, 7.7

Hazardous Substance Cleanup Program (Illinois),


Hearings, leasehold interests, valuation of

property, 10.11 quick-take,

notice, 4.9, 4.31 setting of, 4.8, 4.32

Highest and best use, demonstrative evidence depicting,

admissibility of, 8.35 environmental law, 12.29 – 12.32

costs to alleviate environmental conditions, evidence of, 12.31

Highest and best use (cont.), environmental law (cont.),

environmental conditions, evidence of, 12.30

government action, dependent on, 12.32

in federal practice, 11.19 overview, 7.15 similarity of sales, admissibility

of, 8.29

Highway Advertising Control Act of 1971 (U.S.),


Highway Beautification Act of 1965 (U.S.),


Highway Code (Illinois), authority to exercise eminent

domain, 2.2, 2.17, 2.30 counterclaims and, 3.17 inspection of property and, 12.25 replacement property and, 2.57 valuation of property and, 7.34,

7.36, 7.50

Home-rule authority, 5.33 House of Representatives (Illinois),

quick-take and, 2.19

Housing and Urban Development Department (U.S.),

environmental law and, environmental conditions,

demonstrative evidence of, 12.44

environmental impact statements, 12.22

ICC Termination Act of 1995 (U.S.),

1.6, 1.11 Illegal use,

fair market value, exclusion from, 7.29

Illinois Pattern Jury Instructions,


Illinois Rules of Evidence, appraisers as expert witnesses, 7.9

– 7.12 cross-examination of expert

witnesses, 7.19, 7.37 expert witnesses, 8.31, 8.32 valuation of property, as source of

rules, 7.1, 7.6

INDEX JUS


Immediate right of entry by necessity,

complaints, 2.71

Improvements, leasehold interests, valuation of

property, 10.14 valuation of property in federal

practice, 11.24

Income, relocation assistance not deemed,

11.61

Income approach, valuation of property, 7.26

Injunctions, as remedy of interest holders,

11.52

Inspection of property, environmental law,

county as condemnor, 12.26 post-filing inspection, 12.28 prefiling inspection, 12.25 –

12.27 state as condemnor, 12.27

personal inspection, 2.5 prefiling inspection, 2.33 pretrial procedure, 6.34 requests, forms, 2.75

Institute of Justice, non-state entity eminent domain

proceedings and, 5.20

Instructions to jury see Jury instructions

Interest, appeals, 13.11 as just compensation, 7.20 on abandoned property, 5.42 quick-take, 4.22

Intergovernmental cooperation, precondemnation procedure, 2.27

Intergovernmental Cooperation Act (Illinois),


Interior Department (U.S.),

endangered species and, 12.23 environmental law and,

environmental conditions, demonstrative evidence of, 12.44

Interior Department (U.S.) (cont.), endangered species and (cont.),


Interlocutory appeals,

as of right, 13.16 by permission, 13.17 from final judgment not disposing

of entire action, 13.15

Internal Revenue Code (U.S.), non-state entity eminent domain

proceedings, tax consequences, 5.5

relocation assistance not deemed income, 11.61

International Right of Way

Association, precondemnation procedure and,

2.4

Interrogatories, service of process, 6.11 Supreme Court Rules, 6.24 use of, 6.26

Interstate Commerce Commission Termination Act (U.S.),


Interstate Commerce Commission

(U.S.), railroads, conditions precedent to

actions, 2.26

Inverse condemnation, constitutional provisions, 9.2 federal jurisdiction, 9.8 flooding, 9.10 in federal practice, 11.29 non-state entity eminent domain

proceedings, 5.23 – 5.29 abandoned property, interest

on, 5.42 airports, 5.29 billboards, 5.43 bondholders, 5.41 casinos, 5.39 date of taking, 5.37 downzoning, 5.25 flooding, 5.26 oil wells, 5.40 public body as only possible

buyer, 5.27 streets and parkways, 5.28 takings versus regulation,

5.24

Inverse condemnation (cont.), overview, 9.1, 9.13 regulatory takings, 9.12 ripeness, 9.8 road access, loss of, 9.11 specific cases, 9.9 – 9.12 water invasion, 9.10

Joinder of properties, in federal practice, 11.33

Judgment orders, 1.31 Jurisdiction,

in federal practice, 11.32 inverse condemnation, 9.8

Jury instructions, appeals, 13.4 cautionary instructions, 8.42 definitional instructions, 8.43 expert witnesses, 8.46 overview, 1.28, 8.41 rezoning, 8.44 stipulations, 8.45

Jury trials, demand, 2.61 in federal practice, 11.43 instructions to jury

see Jury instructions just compensation, 11.43 leasehold interests, valuation of

property, 10.10 number of jurors, 8.7 oaths of jurors, 8.9 peremptory challenges, 8.7 right to, 8.6 views of property,

conduct of, 8.14 time requirements, 8.13 view as evidence, 8.12 when required, 8.11

voir dire, 8.8

Just compensation, appeals, 13.4 as fair market value, 7.13 as limitation on federal authority,

11.9 attempts to agree on

see Attempts to agree on compensation

complaints, failure to agree on compensation, 2.58

interest as, 7.20 measurement of, 11.15 non-compensable elements, 11.16 quick-take, preliminary just

compensation,

JUS ILLINOIS EMINENT DOMAIN PRACTICE


Just compensation (cont.), quick-take, preliminary just

compensation (cont.), amount of, 4.16 motion for withdrawal of,

4.36 order for withdrawal of, 4.37 orders, 4.17, 4.33 withdrawal of, 4.19

rules of, 11.14 trials,

commissions, 11.44 jury trials, 11.43 tribunals, 11.42

Just Compensation Clause (U.S.), federal practice, 11.14, 11.27 valuation of property and, 7.14

Landlord and tenant see Leasehold interests

Leasehold interests, authority to exercise eminent

domain, 10.2 automatic termination clauses,

10.23, 10.24 complete takings, 10.7 condemnation clauses,

effect of, 10.3 forms, 10.23

cross-complaints, 10.29 Eminent Domain Act and, 10.21 motions,

for apportionment of award, 10.31

for separate verdict, 10.30 overview, 10.1, 10.22 partial condemnation clauses,

10.26 partial takings, 10.8 parties,

condemnee-landlord, 10.5 condemnee-tenant, 10.6 condemnor, 10.4

research of, 6.31 60-day notice letters, 10.27 total condemnation clauses, 10.25 valuation of property, 10.9 –

10.20 bonus value, 10.16 burden of proof, 10.12 comparable leasehold

valuation, 10.19 consequential losses, 10.20 jury trials, 10.10 options, 10.13 overview, 6.31 permanent improvements,

10.14

Leasehold interests (cont.), valuation of property (cont.),

posttrial apportionment hearings, 10.11

separate apportionment proceeding, testimony in, 10.18

unit rule for improvements, 10.15

verbal leases, 10.13 witnesses, 10.17

waiver of lease, 10.28

Legal description, traverse and motion to dismiss,

failure of as grounds for, 1.18, 3.12

Lis pendens,

forms, 2.77 overview, 1.14, 2.68

Mandamus, constitutional provisions, 9.2 historical background, 9.3 overview, 9.1, 9.13 physical takings required, 9.4 state having record interest in

property, unavailable when, 9.5

Market approach see Comparable-sales approach

Metropolitan Pier and Exposition Authority Act (Illinois),

complaints and, 2.57

Military personnel, precondemnation procedure, 2.12

Minerals, fair market value, 7.36

Mississippi River Flood Control Act (U.S.),


Monetary damages actions, property damage, upon, 9.6 state last in line to pay, 9.7

Mortgage foreclosures, inverse condemnation, 5.30

Motions, expert witnesses, 3.20 leasehold interests,

for apportionment of award, 10.31

for separate verdict, 10.30

Motions (cont.), production of witnesses and

documents, 3.23 quick-take,

contents of, 4.7 service of process, 4.9 time requirements, 4.6 vesting of title, 4.30 withdrawal of preliminary just

compensation, 4.36 right to open and close, 3.26 traverse and motion to dismiss


vesting of title, 1.33 views of property, 3.27

Motions in limine, appeals, 13.4 overview, 1.25, 6.35

Moving expenses, federal practice and, 11.56

Municipal Code (Illinois), disposition of property, 2.1 municipal acquisition of public

property, 2.28 notice and, 5.35

Municipalities see Non-state entity eminent

domain proceedings

Names, in complaints, 2.51

National Association of Independent Fee Appraisers,


National Conference of

Commissioners on Uniform State Laws,

Uniform Eminent Domain Code, 7.6

National Environmental Policy Act

of 1969 (U.S.), environmental law and,


environmental liability, 12.2 precondemnation procedure,

2.7 property development, 12.22

INDEX OPI


National Flood Insurance Act of 1968 (U.S.),

environmental law and, environmental conditions,


property development, 12.17

National Historic Preservation Act (U.S.),


Natural Resources Department

(Illinois), as state agency, 2.15 authority to condemn, 2.3 floodplains and floodways,

jurisdiction over, 12.19, 12.20

Necessity, as condition precedent to action,

1.8 as limitation on federal authority,

11.11 complaints, 2.57 traverse and motion to dismiss,


Negotiation, as condition precedent to actions,

1.9

New trials, appeals from orders, 13.20

Noise, valuation of property in partial

takings, 7.48

Non-state entity eminent domain proceedings,

abandonment of condemnation, 5.34

acquisition of public property, 2.28

attorney considerations, 5.2 condemnation resolution, 5.14 condemnor, acting for, 5.44 correct legal description, 5.11 dismissal, noncompliance with

law resulting in, 5.15 driveways, 5.46 early resolution of, 5.10 easements, 5.45 Eminent Domain Act and, 5.12 excessive taking, 5.22 extension of take date, 5.16 forest preserves, 5.45 home-rule authority and, 5.33

Non-state entity eminent domain proceedings (cont.), interplay among public bodies,

5.31 inverse condemnation, 5.23 – 5.29

abandoned property, interest on, 5.42

airports, 5.29 billboards, 5.43 bondholders, 5.41 casinos, 5.39 date of taking, 5.37 downzoning, 5.25 flooding, 5.26 oil wells, 5.40 public body as only possible

buyer, 5.27 streets and parkways, 5.28 takings versus regulation,

5.24 lessees’ claims, 5.32 mortgage foreclosures, 5.30 notice of, 5.35 overview, 5.1, 5.47 owners, considerations for,

benefits of condemnation, 5.6 early action to oppose

condemnation, 5.7 political and legislative

support, 5.8 pre-resolution stage,

opposition at, 5.9 parking lots, 5.46 plans,

condemnees, 5.4 condemnors, 5.3

private owners, transfers between, changed plans, 5.21 racetracks, 5.20 slum elimination, 5.19 tax increment funding

districts, 5.18, 5.20 settlements,

date of taking, 5.37 good-faith attempts, 5.36 landowners’ rights pending

condemnation, 5.38 tax consequences, 5.5 tax increment funding districts,

transfers between private owners, 5.18, 5.20

transfer among private owners by, 5.17

traverse ending condemnation, 5.13

Nonreversible error,

appeals, 13.8

Northeastern Illinois Planning Commission,

floodplains and floodways, regulation of, 12.19

Notice,

as condition precedent to actions, 2.23

of advance acquisition, 2.30 of forms, 11.70 of non-state entity eminent

domain proceedings, 5.35 quick-take hearings, 4.9, 4.31 requirements, 5.35 rights-of-way, notice of

designation, 2.30 60-day notice letters, 2.15

Oaths, of jurors, 8.9

Objections, in federal practice, 11.37

Occupants, identification of, 2.11

Offers, admissibility of, 8.31 valuation of property in federal

practice, 11.23

Office of State Fire Marshal (Illinois),


O’Hare Modernization Act (Illinois),

applicability of, 7.5 complaints and, 2.57 environmental law and, 12.1 leasehold interests and, 10.21 overview, 1.3

Oil wells, inverse condemnation, 5.40

Opening statements, overview, 8.10 right to open and close, 3.18, 8.40

motions, 3.26

Opinion testimony, fair market value, proving by

opinion testimony of appraisers, 7.8 – 7.12

admissibility of, 7.11 bases of opinions of

appraisers, 7.10

OPI ILLINOIS EMINENT DOMAIN PRACTICE


Opinion testimony (cont.), fair market value, proving by

opinion testimony of appraisers (cont.), expert witnesses, appraisers



and data, 7.11 pretrial procedure, selection of

witnesses, 6.18

Options, leasehold interests, valuation of

property, 10.13

Overview, 1.1 Parking lots,

non-state entity eminent domain proceedings, 5.46

Partial condemnation clauses,

leasehold interests, 10.26

Partial takings, condemnation clauses, 10.26 valuation of property in

see Valuation of property

Parties, appeals from findings as to rights

of, 13.19 identification of, 2.6 leasehold interests,

condemnee-landlord, 10.5 condemnee-tenant, 10.6 condemnor, 10.4

substitution of in federal practice, 11.38

Patient Protection and Affordable

Care Act (U.S.), inverse condemnation and, 9.12

Peremptory challenges, jury trials, 8.7

Petitions, for distribution of deposit, 11.66 of owners for payment, 11.68

Petroleum Marketing Practices Act (U.S.),

leasehold interests and, 10.18

Photographs, environmental conditions, 12.42

Physical takings, mandamus, required for, 9.4

Plain-error doctrine, appeals, 13.2

Plats and plans, overview, 12.39 post-filing development plans,


12.40

Political subdivisions see Non-state entity eminent

domain proceedings

Pollution Control Board (Illinois), environmental law and, 12.2

environmental liability, 12.10

Possession, pending appeal, 13.10

Posttrial matters, deposits, 1.32 judgment orders, 1.31 motions to vest title, 1.33 overview, 1.30 property taxes, 1.35 withdrawal of deposits, 1.34

Power to exercise eminent domain see Authority to exercise eminent

domain

Prayer for relief, complaints, 2.62

Preliminary just compensation, amount of, 4.16 motion for withdrawal of, 4.36 order for withdrawal of, 4.37 orders, 4.17, 4.33 withdrawal of, 4.19

Prerequisites to actions see Conditions precedent to

actions

Preservation of error, appeals, 13.2

Pretrial conferences, 6.36 Pretrial procedure,

acquisition of property, research of, 6.4

appeals, 6.38 attorneys’ fees, discussion of, 6.2

Pretrial procedure (cont.), bills of particulars, 6.33 case management conferences,

6.36 comparable sales, research of,

6.12 condemnees, 6.2 – 6.16 condemnors, 6.17 date of valuation, 6.30 documents, research of, 6.11 encumbrances, research of, 6.31 environmental contamination,

research of, 6.14 evidence, 6.6 expert witnesses, 6.6 inspection of property, 6.34 leasehold interests,

research of, 6.13 valuation of property, 6.31

motions in limine, 6.35 opinion testimony, selection of

witnesses, 6.18 other proceedings, research of, 6.8 overview, 6.1 plans for property, research of, 6.9 pretrial conferences, 6.36 property damage,

cross-petitions, 6.32 research of, 6.16

purchase offers, research of, 6.2, 6.7

sale offers, research of, 6.10 settlement offers,

offer and acceptance, 6.37 research of, 6.15

title issues, 6.29 traverse and motion to dismiss,

6.3 use of property, research of, 6.5 valuation consultants or

witnesses, selection of, 6.19

Prior sales approach, valuation of property in federal

practice, 11.18

Probate Act of 1975 (Illinois), complaints and, 2.52

Production of witnesses and documents,

motions, 3.23

Professional Regulation Division (Illinois),

appraisal standards, 12.45

INDEX REP


Property damage, cross-petitions, 6.32 monetary damages actions upon,

9.6 research of, 6.16

Property taxes, 1.35 Public Officer Prohibited Activities

Act (Illinois), precondemnation procedure and,

2.46

Public purpose, as condition precedent to action,

1.8 traverse and motion to dismiss,


Public records, environmental conditions, 12.44

Public use, as limitation on federal authority,

11.10 standards for determination, 2.1

Public Use Clause (U.S.), overview, 1.2 precondemnation procedure and,

2.1

Public Utilities Act (Illinois), traverse and motion to dismiss

and, 3.11

Purchase price, admissibility of, 8.30

Purpose of eminent domain, 11.3 Questions of law,

appeals, 13.4

Quick-take, alternatives to, 4.24 appeals,

dismissal on, 4.27 issues, 4.25 stay pending, 4.26

condemnees, 6.20 condemnors, 6.21 conditions precedent to actions,

2.19 date of valuation, 4.23 deposit of funds, 4.18 discovery, 4.20 dismissal, 4.29

on appeal, 4.27 Eminent Domain Act, under, 1.40

Quick-take (cont.), entities entitled to exercise power,

4.4 hearings,

notice, 4.9, 4.31 setting of, 4.8, 4.32

interest, 4.22 limitations on power, 4.5 motions,

contents of, 4.7 service of process, 4.9 time requirements, 4.6 vesting of title, 4.30 withdrawal of preliminary just

compensation, 4.36 necessary proofs, 4.10 – 4.16 necessity of, 4.15 overview, 1.37, 4.1 preliminary just compensation,

amount of, 4.16 motion for withdrawal of,

4.36 order for withdrawal of, 4.37 orders, 4.17, 4.33 withdrawal of, 4.19

purpose of, 4.2 right to acquire property by

condemnation, 4.11 – 4.14 authority of plaintiff, 4.12 proper exercise of right, 4.14 property subject to

condemnation, 4.13 schedule or plan of operation,

2.20 source of power, 4.3 subsequent proceedings,

dismissal or abandonment, 4.29

matters inadmissible at trial, 4.28

treasurer’s receipt, 4.34 vesting of title, 4.18

motions, 4.30 orders, 4.35

views of property, 4.21 withdrawal of award, 6.22

Racetracks, private owners, transfers between,

5.20

Railroads, conditions precedent to actions,

2.26

Real Estate Appraiser Licensing Act of 2002 (Illinois),

environmental law, appraisal standards, 12.45

Real Property Conservation Rights Act (Illinois),


Reasonable probability, valuation of property, 7.16

Reasonableness of amount, attempts to agree on

compensation, 2.44

Reduction in size, valuation of property in partial

takings, 7.47

Regulatory takings, inverse condemnation, 9.12

Relocation assistance, coordinator, 2.14 fair market value, exclusion of

costs from, 7.31 in precondemnation procedure,

2.1, 2.13, 2.16 income, not deemed, 11.61 moving expenses, 11.56 overview, 11.55 reimbursement generally, 1.3,

1.38, 2.1 relocation assistance service,

11.59 replacement property,

for homeowners, 11.57 for tenants, 11.58

state assistance or involvement in project, 11.60

URA see Uniform Relocation

Assistance and Real Property Acquisitions Policies Act of 1970 (U.S.)


Remedies of interest holders,

ejectment, 11.53 injunctions, 11.52 trespass, 11.54 Tucker Act, 11.51

Replacement approach, valuation of property, 7.39

Replacement property, complaints, 2.57 fair market value, exclusion of

costs from, 7.33 for homeowners, 11.57 for tenants, 11.58

RES ILLINOIS EMINENT DOMAIN PRACTICE


Res judicata, excessive taking and, 5.22 valuation of property in partial

takings, 7.40

Resource Conservation and Recovery Act (U.S.),

financial responsibility requirements, 12.11

overview, 12.4, 12.9, 12.12 underground storage tank

regulation, 12.10

Restatement (Second) of Property – Landlord and Tenant,

leasehold interests and, 10.3

Restatement (Second) of Torts, environmental liability and, 12.5

Reversible error, appeals, 13.9

Revestments, federal practice and, 11.62

Rezoning, jury instructions, 8.44

Right of entry by necessity, complaints, 2.71

Rights-of-way, fair market value, exclusions

from, 7.34 notice of designation, 2.30

Ripeness, inverse condemnation, 9.8

Riverboat Gambling Act (Illinois), casinos and, 5.39

Rivers, Lakes, and Streams Act (Illinois),


Road access,

inverse condemnation, 9.11

Roads and Bridges Act (Illinois), environmental law, inspection of

property, 12.28

Rules of Professional Conduct (Illinois),


School Code (Illinois), complaints and, 2.51

Service of process, complaints, 1.13

by publication, 2.64 excusing, 2.66 special process servers, 2.65 summons, 2.65

in federal practice, 11.35 interrogatories, 6.11 quick-take, motions, 4.9

Servicemembers Civil Relief Act (U.S.),


Setoff,

valuation of property in federal practice, 11.28

Settlements,

non-state entity eminent domain proceedings,

date of taking, 5.37 good-faith attempts, 5.36 landowners’ rights pending

condemnation, 5.38 overview, 2.1 pretrial offers,

offer and acceptance, 6.37 research of, 6.15

Severance of trials, 8.4 Similarity of sales,

assemblage sales, 8.20 date of sale, 8.28 highest and best use, 8.29 improved versus unimproved

properties, 8.26 overview, 8.20 proximity, 8.22 size, 8.23 subdivision property, 8.27 utilities, 8.24 zoning, 8.25

60-day notice letters, forms, 2.74 leasehold interests, 10.27 overview, 2.15

Slum elimination, private owners, transfers between,

5.19

Society of Real Estate Appraisers, precondemnation procedure and, 2.4

Soil Conservation Service (U.S.) (cont.),

contour maps, 12.43

Southwestern Illinois Development Authority,

owners, considerations for, 5.10

Southwestern Illinois Development Authority Act (Illinois),

private owners, transfers between, 5.18

Special-use property,

valuation of, 7.39

Standards of review, appeals, 13.4

State Agency Historic Resources Preservation Act (Illinois),


State Property Control Act

(Illinois), precondemnation procedure and,

2.1

Statement of authority, complaints, 2.54

Statement of necessity, complaints, 2.56

Statement of purpose, complaints, 2.55

Stay pending appeal, quick-take, 4.26

Stipulations, jury instructions, 8.45 valuation of property in partial

takings, 7.43

Streets and parkways, inverse condemnation, 5.28

Subdivision approach, valuation of property in federal

practice, 11.20

Subdivision property, fair market value, 7.37 similarity of sales, admissibility

of, 8.27

Substitution of parties, in federal practice, 11.38

INDEX TRA


Summons, overview, 2.63 service of process, 2.65

Supreme Court (Illinois), appeals to, 13.22 – 13.25

as of right, 13.25 certificate of importance,

13.24 direct appeal, 13.23

Supreme Court Rules (Illinois), appeals

see Appeals applicability of, 8.3 billboards and, 5.43 case management conferences,

6.36 cross-petitions, 7.41 depositions, 6.27 disclosure requirements, 7.46 discovery, 6.23

additional discovery, 6.25 early discovery, 3.3 overview, 1.21 pretrial procedure, 6.23 valuation of property, 7.14 witnesses, 1.23

environmental conditions, demonstrative evidence of, 12.44

excessive taking and, 5.22 expert witnesses, 3.20

valuation of property, 7.9 inspection of property, 6.34,

12.26, 12.28 interrogatories, 6.11, 6.24 opinion testimony, 6.18 pretrial appeals, 6.38 quick-take and, 4.9, 4.25 right to open and close, 8.40 service of process, 1.13, 2.66 settlement offers, 6.37 summons, 2.63 traverse and motion to dismiss

and, 3.15 valuation of property and, 7.6

expert witnesses, 7.9 voir dire, 8.8 witnesses, 8.36, 8.37

Surface Transportation Board (U.S.),

railroads, conditions precedent to actions, 2.26

Surveys, precondemnation procedure and,

2.8

Takings Clause (U.S.), overview, 11.4

Tax Increment Allocation

Redevelopment Act (Illinois), overview, 1.3 precondemnation procedure, 2.7 private owners, transfers between,

5.18, 5.21 traverse and motion to dismiss

and, 3.10 urban redevelopment, 1.36

Tax increment funding districts, private owners, transfers between,

5.18 challenges to, 5.20

Taxation, assessments, valuation of property

in federal practice, 11.22 fair market value, exclusion from,

7.32 non-state entity eminent domain

proceedings, tax consequences, 5.5

Telecommunications Act of 1996

(U.S.), interplay among public bodies,

5.31

Telephone Company Act (Illinois), quick-take and, 4.13

Temporary takings, federal practice and, 11.12

Timber, fair market value, 7.36

Time requirements, appeals, 13.5 quick-take, motions, 4.6 traverse and motion to dismiss,

3.5 views of property, 8.13

Title to property, pretrial procedure, 6.29

Total condemnation clauses, leasehold interests, 10.25

Township Open Space Act (Illinois — former), owners, considerations for, 5.8

Toxic Substances and Disease Registry Agency (U.S.),


Toxic Substances Control Act (U.S.),

environmental liability and, 12.4, 12.12

Transportation Department

(Illinois), appraisers, hiring, 2.4 as state agency, 2.15 authority to condemn, 2.3, 2.17 counterclaims and, 3.17 early discovery and, 3.3 environmental conditions,


pretrial procedure, 6.2, 6.3 quick-take and, 4.16 replacement property and, 2.57 right-of-way designation by, 2.30 valuation of property and, 12.34

Transportation Department (U.S.), railroads, conditions precedent to

actions, 2.26

Traverse and motion to dismiss, appeals from orders, 3.15, 13.18 denial of, 3.15 grant of, 3.16 grounds for, 3.6 – 3.12

attempts to agree on compensation, lack of, 1.19, 3.9

authority, lack of, 1.17, 3.10 Commerce Commission

approval, lack of, 1.20 legal description, failure of,

1.18, 3.12 necessity, lack of, 1.17, 3.7 property not subject to

condemnation, 3.11 public purpose, lack of, 1.17,

3.8 motions, 3.24 non-state entity eminent domain

proceedings, traverse ending condemnation, 5.13

overview, 1.16 purpose of, 3.4 time requirements, 3.5 trials, 3.14 when traverse does not lie, 3.13

TRE ILLINOIS EMINENT DOMAIN PRACTICE


Treasurer’s receipt, quick-take, 4.34

Trespass, as remedy of interest holders,

11.54

Trials, abandonment, 1.29 admissibility of evidence

see Admissibility of evidence atmosphere of, 8.1 closing arguments, 8.47 collateral evidence, 8.15 consolidation of, 8.4 constitutional provisions, 8.3 evidence, 1.27 in federal practice, 11.41 – 11.45

commissions, 11.44 district courts, 11.45 jury trials, 11.43 tribunals, 11.42

instructions to jury see Jury instructions

jury instructions, 1.28 jury trials

see Jury trials just compensation,

commissions, 11.44 jury trials, 11.43 tribunals, 11.42

motions in limine, 1.25 opening statements, 8.10 overview, 1.24 right to open and close, 3.18, 8.40

motions, 3.26 setting for, 8.5 severance of, 8.4 statutory provisions, 8.3 testimony, 1.27 traverse and motion to dismiss,

3.14 views of property

see Views of property witnesses

see Witnesses

Tribunals, federal practice and, 11.42

Tucker Act (U.S.), federal practice and, 11.51

Underground Storage Tank Fund (Illinois),


Uniform Appraisal Standards for Federal Land Acquisitions, federal practice and, 11.8

Uniform Commercial Code (Illinois),


Uniform Disposition of Unclaimed Property Act (Illinois),


Uniform Eminent Domain Code, valuation of property and, 7.6

Uniform Relocation Assistance and Real Property Acquisitions Policies Act of 1970 (U.S.),

appraisers, hiring, 2.4 attempts to agree on

compensation, 2.43 federal practice and, 11.8

defenses, 11.37 discovery, 11.40

inspection of property, 2.33 just compensation and, 7.20 owners, contacts with, 2.31 precondemnation procedure, 2.7 quick-take, preliminary just

compensation, 4.16 relocation assistance generally,

1.3, 1.38, 2.1, 2.16 valuation of property,

as source of rules, 7.3 in partial takings, 7.51 relocation assistance, 7.22,

7.31

Uniform Standards of Professional Appraisal Practice,


Unit rule, cross-examination of expert

witnesses, 7.19 leasehold interests, 10.15 overview, 7.17 – 7.19 partial takings, 7.18

Unknown owners, affidavits as to, 2.79 complaints, 2.53

Unsightliness, valuation of property in partial

takings, 7.49

URA see Uniform Relocation

Assistance and Real Property Acquisitions Policies Act of 1970 (U.S.)

Urban redevelopment,

eminent domain for, 1.36

Utilities, complaints, 1.11 conditions precedent to actions,

2.25 similarity of sales, admissibility

of, 8.24

Valuation of property, appeals from, 7.7 business income approach, 11.21 consequential damages, 11.27 consultants, selection of, 6.19 date of, 7.14

new date, 6.30 easements,

permanent easement, 7.53 temporary easement, 7.54

Eminent Domain Act and, attorneys’ fees, 7.21 court costs and expenses, 7.21 effective date, 7.5 exceptions, 7.5 historical background, 7.4 overview, 7.3 relocation assistance, 7.22

environmental issues, 7.35 fair market value

see Fair market value highest and best use

see Highest and best use historical background, 7.2 improvements, 11.24 in federal practice, 11.17 – 11.28 in partial takings,

access, 7.50 benefits, 7.52 cost to cure, 7.46 cross-petitions, 7.41 general principles, 7.40 improper elements of

damages, 7.51 noise, 7.48 proper elements of damages,

7.45 – 7.50 reduction in size, 7.47 remainder property defined,

7.44 res judicata, 7.40 stipulations, 7.43 unsightliness, 7.49 valuation of part taken, 7.42

INDEX ZON


Valuation of property (cont.), just compensation,

as fair market value, 7.13 interest as, 7.20

leasehold interests see Leasehold interests

offers, 11.23 overview, 2.1, 7.1 price paid by condemnor, 11.26 prior sales, 11.18 reasonable probability, 7.16 replacement approach, 7.39 setoff, 11.28 sources of rules, 7.6 special-use property, 7.39 subdivision approach, 11.20 tax assessments, 11.22 unit rule, 7.17 – 7.19

cross-examination of expert witnesses, 7.19

leasehold interests, 10.15 partial takings, 7.18

witnesses, owner as witness, 8.37 partial takings, 8.39 sample questions, 8.38 selection of, 6.19 total takings, 8.36

zoning, 11.25

Venue, in federal practice, 11.32

Verbal leases, leasehold interests, valuation of

property, 10.13

Verdicts, appeals, 13.4

Vesting of title, motions, 1.33 quick-take, 4.18

motions, 4.30 orders, 4.35

Views of property, by condemnee, 3.19

motions, 3.27 by jury,

conduct of, 8.14 time requirements, 8.13 view as evidence, 8.12 when required, 8.11

overview, 1.26 quick-take, 4.21

Voir dire, 8.8

Voluntary conveyance, precondemnation procedure, 2.46

Voluntary transactions, admissibility of, 8.17

for cash, 8.19 voluntariness, 8.18

Waivers, attempts to agree on

compensation, 2.41 leasehold interests, waiver of

lease, 10.28 right to appeal, 13.3

Water invasion, inverse condemnation, 9.10

Water Resources Division (Illinois), environmental conditions,



Wetland delineations, environmental conditions,


Wetlands regulation, 12.21 Withdrawal of deposits, 1.34 Witnesses,

discovery, 1.23 expert witnesses

see Expert witnesses leasehold interests, valuation of

property, 10.17 separate apportionment

proceeding, testimony in, 10.18

opinion testimony see Opinion testimony

production of witnesses and documents, motions, 3.23

testimony, 1.27 valuation of property,

owner as witness, 8.37 partial takings, 8.39 sample questions, 8.38 selection of witnesses, 6.19 total takings, 8.36

Yellow Book, federal practice and, 11.8

Zoning, similarity of sales, admissibility

of, 8.25 valuation of property in federal

practice, 11.25