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Lake County Forest Preserve Dist. v. Petersen

OPINION FILED FEBRUARY 26, 1981.

LAKE COUNTY FOREST PRESERVE DISTRICT, PLAINTIFF-APPELLEE,

v.

RAYMOND A. PETERSEN ET AL., DEFENDANTS-APPELLANTS.



APPEAL from the Circuit Court of Lake County; the Hon. FRED H. GEIGER, Judge, presiding.

MR. PRESIDING JUSTICE SEIDENFELD DELIVERED THE OPINION OF THE COURT:

Defendants bring this consolidated appeal from a judgment entered in a condemnation proceeding. The central issue is whether the trial judge erred in excluding valuation testimony based on the reasonable probability of obtaining a sanitary landfill permit from the Environmental Protection Agency (hereinafter EPA).

On October 2, 1974, the Lake County Forest Preserve District filed a petition to condemn 263 acres of land near the intersection of Buckley Road and the Des Plaines River in Libertyville Township. The Catholic Youth Organization owns 161 acres of this parcel; the remaining 102 acres are owned by the other defendants. The property is presently zoned single-family residential, but contains a large sand and gravel pit which was being actively mined at the time the condemnation petition was filed.

The defendants proceeded at trial on the theory that the highest and best use of the property was for a sanitary landfill rather than residential development. The only authorization necessary for the development and operation of a landfill in Lake County is a permit from the EPA. *fn1 Upon motion by defendants, the trial court held an in limine hearing on the reasonable probability of obtaining an EPA permit. Defendants presented five witnesses whose testimony indicated there was a reasonable probability of the issuance of a permit for the development and operation of a sanitary landfill in the near future. Several engineers testified that the geological characteristics of the property were suitable for refuse disposal and that landfills which had received permits from the EPA in 1974 were similar to the facility proposed for the subject property. Two land planners called by defendants testified that there was a need for landfills in Lake County and that a landfill on the subject property would be economically feasible and compatible with surrounding use. Both planners testified that the highest and best use of the property was a sanitary landfill.

After hearing all of the evidence, the trial court denied defendants' motion to admit valuation testimony based upon the reasonable probability of obtaining an EPA permit, and entered an order containing the following findings:

"5. A sanitary landfill on the subject property would present a pollution hazard to surficial and deep aquifers.

6. There is inadequate evidence to support the feasibility of construction of a clay liner which would assure protection from pollution hazards.

7. There is insufficient evidence by way of history of approved sites to demonstrate that the EPA would issue a landfill permit to the subject property. Sanitary landfill permits for new sites approved in the past were issued on sites where there was an adequate existing clay base and no pollution hazards to existing aquifers existed."

Defendants filed an interlocutory appeal from this order under Supreme Court Rule 308 (Ill. Rev. Stat. 1979, ch. 110A, par. 308) which we denied on April 19, 1978. The parties subsequently stipulated to the value of the property as presently zoned and agreed to waive trial by jury. On August 22, 1979, a judgment order was entered based on the agreement awarding defendant Catholic Youth Organization a total of $782,365 and the remaining defendants a total of $460,000. Defendants appeal. The issues raised are whether the doctrine of reasonable probability should be extended to include the issuance of an EPA permit and, if so, whether the court erred in not allowing submission to the jury of valuation testimony based on that doctrine.

• 1 It is well settled under the law of eminent domain that the owner of property condemned for public use is entitled to just compensation measured by the fair market value of the property at its highest and best use. (Department of Public Works & Buildings v. Association of Franciscan Fathers (1977), 69 Ill.2d 308, 314, 319; Department of Public Works & Buildings v. Rogers (1968), 39 Ill.2d 109, 114.) 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 (Department of Public Works & Buildings v. Association of Franciscan Fathers (1977), 69 Ill.2d 308, 315; Forest Preserve District v. Kelley (1979), 69 Ill. App.3d 309, 315) and annexation (Lake County Forest Preserve District v. Reliance Standard Life Insurance Co. (1975), 29 Ill. App.3d 145, 151), although it also has been applied to the probability of obtaining other governmental action which would enhance the market value of the condemned property. City of Chicago v. Sexton (1951), 408 Ill. 351, 356-57 (probability of obtaining approval of the sale or lease of railroad land by the Illinois Commerce Commission); Chicago & Western Indiana R.R. Co. v. Heidenreich (1912), 254 Ill. 231, 243 (probability of obtaining permission from city council to run a switch track to property suitable for warehouse use); South Park Comrs. v. Ayer (1908), 237 Ill. 211, 220 (defendant permitted to show use to which railroad property could be put).

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. Evidence of value based on potential rezoning is admissible, for example, because rezoning is one of the factors which would reasonably be given weight by a prospective purchaser in a free market sale. We believe this rationale would justify the admission of valuation testimony based on the reasonable probability of obtaining an EPA permit for the operation of a sanitary landfill, and conclude the doctrine of reasonable probability of rezoning may be extended to include such a reasonable probability.

The accepted procedure is for the trial judge to make a preliminary determination of sufficiency of the evidence of reasonable probability before allowing valuation testimony based upon it to be presented to the jury. Department of Public Works & Buildings v. Association of Franciscan Fathers (1977), 69 Ill.2d 308, 315.

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. (Lombard Park District v. Chicago Title & Trust Co. (1968), 103 Ill. App.2d 1, 9.) 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. (Department of Public Works & Buildings v. Kelly (1976), 40 Ill. App.3d 896, 905.) The test is considered satisfied in rezoning cases when the evidence shows rigid zoning requirements have been relaxed by municipal authorities which indicated a degree of "flexibility." Department of Public Works & Buildings v. Rogers (1968), 39 Ill.2d 109, 114; Forest Preserve District v. Kelley (1979), 69 Ill. App.3d 309, 315. Department of Public Works v. Franciscan Fathers (1977), 69 Ill.2d 308, 315.

• 2 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. (Department of Public Works & Buildings v. Rogers (1968), 39 Ill.2d 109, 115.) 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. We have applied a similar standard to the determination of whether the reasonable probability of rezoning should go to the trier of facts (Lombard Park District v. Chicago Title & Trust Co. (1968), 103 Ill. App.2d 1, 9; Department of Public Works v. Franciscan Fathers (1976), 44 Ill. App.3d 49, 59-60, aff'd (1977), 69 Ill.2d 308), and whether there is a reasonable probability that property will be annexed to a municipality. (Forest Preserve District v. Kelley (1979), 69 Ill. App.3d 309, 320-21; Lake County Forest Preserve v. Reliance Standard Life Insurance (1975), 29 Ill. App.3d 145, 151.) The test to be applied "is ...


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