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Marshall Field & Co. v. Vil. of S. Barrington





APPEAL from the Circuit Court of Cook County; the Hon. ARTHUR L. DUNNE, Judge, presiding.


Plaintiff Marshall Field & Co. (Field) filed an action for declaratory judgment (Ill. Rev. Stat. 1979, ch. 110, par. 57.1) seeking a judicial determination of the validity of two resolutions of the defendant village of South Barrington's government to issue revenue bonds in order to finance the construction of Field retail facilities located in West Dundee and Bloomingdale, Illinois. Following submission of the initial pleadings, Field moved for summary judgment. Both parties filed briefs, and the trial court granted Field's motion, declaring the proposed bond issues to be consonant with the Illinois Constitution and State law.

South Barrington appeals that finding, asserting two bases upon which the trial court allegedly should have invalidated the bond isues: (1) that South Barrington exceeded its constitutionally granted home-rule authority in undertaking these particular bond proposals; and (2) that the financing scheme lacked the constitutionally required public purpose.

The substantive facts presented in the record to the trial court and this court are of minimal quantity. Due to the outcome of the proceedings below, they are derived entirely from the pleadings and motions of the parties and are "undisputed."

South Barrington is a home-rule unit in accordance with provisions of the Illinois Constitution. (Ill. Const. 1970, art. VII, § 6.) On January 17, 1980, South Barrington adopted two resolutions which stated the village's intent to market two revenue bond issues not exceeding $9 million each for the purpose of financing the construction of Field retail facilities in the villages of West Dundee and Bloomingdale. Included in the resolutions were the following findings: (1) that the bond financing was necessary to insure the completion of the facilities, *fn1 and (2) that the financing arrangements would "promote and further public purposes." Incorporated into the resolutions were memoranda of agreement between the village and Field. Among the representations therein were a restatement that the arrangements served the public purposes, a notation that Field wished to begin construction of the facilities only after "satisfactory assurances" that the proposed financing would be available, and an agreement that South Barrington would "* * * cooperate with the Company [Field] to endeavor to find a purchaser or purchasers for the bonds, and * * * will adopt such proceedings and authorize the execution of such documents as may be necessary or desirable for the authorization, issuance and sale * * * all as shall be authorized by law and mutually satisfactory to the Issuer and the Company." Also agreed to were that Field would be responsible for payment of the principal, interest, and premium on the bonds, and that the two projects together would result in 625 new jobs. *fn2 Parenthetically, we note that the record under consideration contains no additional documents referred to in the memoranda, nor does it contain copies of the bonds intended to be issued. Rather, the information on these matters comes to us solely from the resolutions and appended memoranda.

At the time these writings were entered into, neither West Dundee nor Bloomingdale was a home-rule unit under the provisions of the constitution.

On June 20, 1980, South Barrington's corporate counsel notified Field that the village would not proceed with the bond issues because of questions as to their legality. The problems set forth are identical to those raised on this appeal. Faced with this position of South Barrington, Field instituted this action.


South Barrington contends that the proposed bond issues exceeded the permissible scope of its home rule authority as granted by the constitution. It is argued that the funding by a home rule unit of a commercial facility located within the corporate boundaries of another municipality which is not a home rule unit does not "pertain to the government and affairs" of South Barrington, the home rule unit, as required by the constitution.

Prior to the adoption of the 1970 Constitution, the power and authority of municipal entities were governed by what is commonly referred to as Dillon's Rule:

[A] municipal corporation possesses and can exercise the following powers, and no others: First, those granted [in legislative delegation] in express words; second, those necessarily or fairly implied in or incident to the powers expressly granted; third, those essential to the accomplishment of the declared objects and purposes of the corporation * * *." (1 Dillon, Law of Municipal Corporations § 237, at 449 (5th ed. 1911).)

(See Ives v. City of Chicago (1964), 30 Ill.2d 582, 585, 198 N.E.2d 518.) Thereunder, legislative grants of authority by the State to local governmental units were to be strictly construed. See Connelly v. County of Clark (1973), 16 Ill. App.3d 947, 949, 307 N.E.2d 128.

• 1 The 1970 Constitution radically altered this relationship of municipalities to the State by introducing the concept of home rule. "Except as limited by this section, a home rule unit may exercise any power and perform any function pertaining to its government and affairs * * *." (Emphasis added.) (Ill. Const. 1970, art. VII, § 6(a).) The terms of this grant of power to home rule units are broad and imprecise; however, the qualifying language emphasized above was clearly intended as a limit upon that power. It is for the judiciary to determine how extensive this limitation is to be. See County of Cook v. John Sexton Contractors Co. (1979), 75 Ill.2d 494, 508-09, 389 N.E.2d 553; Ampersand, Inc. v. Finley (1975), 61 Ill.2d 537, 540, 338 N.E.2d 15.

In determining the extent of home rule power as intended by the framers of that provision (and therefore in determining the scope of the limiting language on that grant of power), the following statement of the Local Government Committee to the sixth ...

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