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People v. Chicago Metro Car Rentals

OPINION FILED MAY 18, 1979.

THE PEOPLE OF THE STATE OF ILLINOIS, PLAINTIFF-APPELLEE,

v.

CHICAGO METRO CAR RENTALS, INC., DEFENDANT-APPELLANT.



APPEAL from the Circuit Court of Cook County; the Hon. ROBERT J. DEMPSEY, Judge, presiding. MR. JUSTICE LORENZ DELIVERED THE OPINION OF THE COURT:

Plaintiff (the State) filed a complaint seeking to collect delinquent 1975 real estate taxes from defendant (Metro), the alleged owner of certain real property. The trial court granted summary judgment in favor of the State, finding that Metro leased *fn1 the subject property from the City of Chicago (the City). On appeal, Metro contends only that the trial court erred in finding that an "Airport Concession Agreement" between itself and the City constituted a lease.

The following facts are pertinent to a disposition of this appeal.

On March 22, 1974, the City and Chicago Budget Rent-a-Car, Inc. (Budget) entered into an "Airport Concession Agreement" whereby Budget was granted a "non-exclusive privilege * * * to operate a rent-a-car business on, upon and from" Chicago-O'Hare International Airport and "for no other purpose whatsoever." The record is unclear as to whether Budget subsequently assigned its rights and obligations under the agreement to Metro or whether, as contended by Metro at oral argument, Budget subsequently changed its corporate name to Metro. However, the parties agree that Metro was a party to the agreement during the relevant period. Accordingly, we shall treat the agreement as existing between the City and Metro rather than Budget.

The agreement states that Metro "desires to lease certain space, and to obtain certain rights and privileges with respect to the operation of a rent-a-car service" at the airport. The agreement commenced on March 22, 1974, and was to end on February 23, 1992, unless sooner terminated pursuant to provisions of the agreement. The City retained the right to seek renegotiation of the terms and conditions relating to compensation at five year intervals. Metro agreed to negotiate in good faith when notified that the City sought such a change. In the event that the said terms were not renegotiated to the City's satisfaction within six months, the agreement would terminate. Metro agreed not to "assign, sublet or transfer" the agreement without the City's approval.

Article V of the agreement, titled "Demised Premises," explicitly states that the City "demises and leases" certain described premises. The City retained a right of entry for purposes of future installation, maintenance and repair, but agreed that such entry would "be performed so as to interfere as little as reasonably possible" with Metro's operation. The premises "demise[d] and lease[d]" were as follows:

(1) 248 square feet of counter space on the first floor concourse of Terminal Building 2, the precise location thereof to be determined by the commissioner of aviation;

(2) 248 square feet of counter space on the first floor concourse of Terminal Building 3, the precise location of the counter to be determined by the commissioner of aviation;

(3) Temporary Automobile Service Area A, a 52,027.40 square foot area which was legally described and diagrammed in the agreement for which was to be used for storage and maintenance of automobiles;

(4) Permanent Service Area B, a 203,250 square foot area upon which Metro agreed to expend $750,000 for construction of certain buildings and improvements for "use in maintenance, servicing, parking and storage of its vehicles."

The agreement further allowed the commissioner of aviation to relocate the counter areas upon 90 days written notice if modification or expansion of the Terminal Buildings necessitated. The City would bear the cost of such relocation. Metro agreed to vacate Temporary Service Area A within 10 days of completion of Permanent Service Area B. The "rental with respect to Temporary Service Area A [would] thereupon terminate."

Concession and rental fees were provided for under the agreement. The City was to receive 10% of the gross receipts as a concession fee, with a minimum guarantee of $185,000 for the first year. The concession fee and minimum guarantee were subject to future adjustment. The City was also to receive $268.67 per month as "rental" for the two counter areas and $433.56 per month as "rental" for Temporary Service Area A.

The agreement further provided that rates to be charged the public for rent-a-car services were subject to approval by the commissioner of aviation; that employees and invitees of Metro must conduct themselves in an orderly and proper manner; and that business could be solicited only from the counter areas. Metro agreed also to provide good, prompt and efficient service and to keep "the facilities demised to it" open for a sufficient amount of time to meet reasonable demands for services. Metro further agreed to indemnify the City for liability resulting from "use or occupancy of the leased premises."

Although the City retained the right to make reasonable inspections of "the demised premises," it specifically granted Metro the right to "have, hold and enjoy quiet and uninterrupted possession of the premises and rights herein leased and granted."

On May 16, 1977, the State filed a complaint against Metro, seeking payment of the 1975 real estate taxes for the property covered by the agreement. The complaint alleged that Metro, as owner of the subject property, was liable for the real estate taxes thereon. Count I sought delinquent taxes of $3,878.39 plus interest and penalties for property identified as Permanent Index No. 12-08-100-006-8017, Volume 310. Count II sought delinquent taxes of $670.94 plus interest and penalties for property identified as Permanent Index No. ...


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