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Village of Hillside v. Commerce Com.





Appeal from the Circuit Court of Cook County; the Hon. James C. Murray, Judge, presiding.


These consolidated appeals are from the trial court's affirmance of two orders entered by the Illinois Commerce Commission (Commission) (1) approving Commonwealth Edison Company's (Edison) petition to sell Hillside Stone Quarry (Quarry) to John Sexton Sand and Gravel Corporation (Sexton) and Browning-Ferris Industries, Inc. (Browning-Ferris); and (2) determining that Edison had not violated section 27 of the Public Utilities Act (the Act) (Ill. Rev. Stat. 1979, ch. 111 2/3, par. 27). Plaintiff contends (a) the order approving sale of the Quarry is against the manifest weight of the evidence because Edison failed to establish either that the sale served the public interest or that the proposed sale price reflected the fair market value of the land; and (b) the finding that Edison did not violate the Act is against the manifest weight of the evidence when Edison, without prior approval, transferred permits to Sexton, granted possession of the Quarry to Sexton, and effectuated a lease of the Quarry.

The Quarry, which is the subject matter of these proceedings, occupies approximately 75 acres of land adjacent to the intersection of the Eisenhower Expressway and Mannheim Road in the village of Hillside, Illinois. It was created by limestone mining, and an excavation covers about 62 of the 75 acres to a depth of 300 feet. Edison purchased the Quarry for $8,001,839 on August 12, 1976, for use as a fly ash and combustion byproduct disposal site. Because of additional development expenditures, the total original cost of the property was $11,675,994. Shortly after acquiring the Quarry, Edison determined that it would not need the entire site and began looking, without success, for a purchaser who would permit Edison to use a portion thereof for its disposal needs.

Upon further consideration of its requirements. Edison concluded that it was uneconomical to use any part of the Quarry to dispose of waste materials. When no alternative use in Edison's business could be found, the Quarry was declared excess in July 1978 and offered for sale at $12,000,000. There were several inquiries, but only two offers to purchase were received — both from companies that planned to use the Quarry as a sanitary landfill; i.e., to dump garbage and inorganic matter. The first offer came from Sexton, but was rejected. Thereafter, an offer from Waste Management, Inc., was also rejected because the price and payment terms were even less attractive than Sexton's initial offer.

Negotiations were conducted with both Sexton and Waste Management until November of 1978, when Edison and Sexton reached a tentative agreement on price. While the parties continued their negotiation of other terms, Sexton requested access to the property to do some work in anticipation of its purchase, and Edison granted a right of entry on November 16, 1978, later modified by letters dated December 14, 1978, and December 4, 1979.

On May 7, 1979, Edison executed a contract for sale of the Quarry to Sexton and Browning-Ferris for $9,550,000. Two days later it also joined in Sexton's permit application requesting that the Illinois Environmental Protection Agency (EPA) transfer to Sexton permits held by Edison to develop the Quarry as a clean landfill; i.e., a dumping site for only inorganic matter. The EPA transferred these permits to Sexton on August 14, 1979. *fn1

Edison filed a petition with the Commission on May 24, 1979, pursuant to section 27 of the Act (Ill. Rev. Stat. 1979, ch. 111 2/3, par. 27), seeking approval of the sale to Sexton and Browning-Ferris. While this petition was pending, plaintiff brought to the Commission's attention various alleged violations of the Act by Edison. In particular, plaintiff asserted that Edison, without the prior approval and consent of the Commission, transferred property rights and a right of entry to Sexton; petitioned the EPA for transfer of its permits to Sexton; provided in its contract for a lease that commenced on November 7, 1979; and permitted Sexton to engage in work activities beyond those contemplated in the right of entry agreements.

In response to these allegations, the Commission entered a citation order on February 20, 1980, requiring Edison to appear and show cause why it should not be found in violation of section 27 of the Act. A hearing was held for the taking of oral and documentary evidence, and both Edison and plaintiff submitted written briefs. On July 16, 1980, the Commission dismissed the citation order, finding that Edison had not violated the Act. Plaintiff's application for rehearing was denied on August 27, 1980.

Fifteen days of hearings were held between June 19 and September 21, 1979, on Edison's petition for approval of its sale of the Quarry. Sexton and Browning-Ferris participated in these proceedings by leave of the Commission, pending approval of their petition to intervene, *fn2 and after all parties submitted written briefs and reply briefs, the Commission on July 16, 1980 issued an order approving the proposed sale.

Thereafter, pursuant to section 68 of the Act (Ill. Rev. Stat. 1979, ch. 111 2/3, par. 72), plaintiff filed appeals in the trial court seeking review of the order finding no violation of the Act and the order approving sale of the Quarry to Sexton and Browning-Ferris. Both were affirmed by that court on October 2, 1981, and these appeals followed.


Plaintiff initially contends that the Commission order approving sale of the Quarry to Sexton and Browning-Ferris was contrary to the manifest weight of the evidence because (a) it fails to give proper weight to the convenience and necessity of the community surrounding the Quarry in balancing the interests of Edison against the public interest and (b) the approved purchase price did not represent the fair market value of the property.

We first consider, however, the question raised by Edison as to whether those contentions are moot because reversal of the Commission's order could not cause a change in the current ownership of the Quarry. Once having received Commission approval, Edison maintains that it could lawfully proceed with the sale even though an appeal was pending. Therefore, since it conveyed title to Sexton and Browning-Ferris on July 24, 1980, it argues that plaintiff's failure to obtain a stay pending appeal has made the propriety of the Commission's order irrelevant.

Edison relies on Mandel Brothers, Inc. v. Chicago Tunnel Terminal Co. (1954), 2 Ill.2d 205, 117 N.E.2d 774, in support of its argument. There, the defendant charged freight rates which had been approved by the Commission. The order finding the rates just and reasonable was subsequently reversed, and plaintiff sought recovery of allegedly excessive charges made while the new rates were in effect. The supreme court held that while the order was in effect, defendant was required by statute to charge those rates in the ...

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