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01/13/89 Bank of Wheaton Et Al., v. the Village of Itasca Et

January 13, 1989

BANK OF WHEATON ET AL., PLAINTIFFS

v.

THE VILLAGE OF ITASCA ET AL., DEFENDANTS-APPELLANTS (CHICAGO TITLE & TRUST COMPANY, AS TRUSTEE, ET AL., INTERVENING PLAINTIFFS-APPELLEES)



APPELLATE COURT OF ILLINOIS, SECOND DISTRICT

533 N.E.2d 553, 178 Ill. App. 3d 626, 127 Ill. Dec. 681 1989.IL.31

Appeal from the Circuit Court of Du Page County; the Hon. John S. Teschner, Judge, presiding.

APPELLATE Judges:

JUSTICE INGLIS delivered the opinion of the court. REINHARD and DUNN, JJ., concur.

DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE INGLIS

This appeal involves a dispute regarding the continued validity of a 1970 annexation agreement entered into between plaintiff Bank of Wheaton, as trustee, and defendant, Village of Itasca. Plaintiffs, Bank of Wheaton as trustee under trust No. 1638, and Anastasia Spear and Catherine Kanzler as beneficiaries, brought the underlying action seeking to enjoin the Village from denying the continued validity of the annexation agreement beyond its original expiration date of November 3, 1975. The trial court entered two orders extending the agreement, the second of which extended the agreement indefinitely. Intervening plaintiffs, Chicago Title & Trust Company as trustee under trust No. 1087081, and Vantage Properties, Inc., subsequently purchased a parcel of the property covered under the annexation agreement and submitted plans for its development. The Village refused to approve the plans after concluding that a newly enacted zoning ordinance prohibited the contemplated construction. Intervening plaintiffs moved for summary judgment on the basis that the annexation agreement and a prior zoning ordinance incorporated within the agreement were applicable to development of the property. The Village countered with a petition to modify the court order indefinitely extending the agreement and sought to terminate the agreement. The trial court granted summary judgment in favor of intervening plaintiffs and held the new zoning ordinance inapplicable to the property. The court further denied the relief sought by the Village. The Village appealed, raising two issues: (1) whether the trial court erred in denying its petition seeking termination of the agreement; and (2) whether the trial court erred in granting intervening plaintiffs' motion for summary judgment and declaring the new zoning ordinance inapplicable to the property. For the reasons set forth below, we reverse the trial court's judgment granting intervening plaintiffs' motion for summary judgment and denying the Village's petition, and remand this cause to the trial court for further proceedings.

On November 3, 1970, the Village and Bank of Wheaton entered into an annexation agreement for 97 acres of property held in trust by Bank of Wheaton. The agreement was entered into following a public hearing and approval by Village ordinance. The agreement provided that the property would be zoned under Itasca Zoning Ordinance No. 134-59, and that the Village would amend that zoning ordinance for development of the property in four tracts. Tract A was to be developed for single-family residence and classified R-1; tract B was to be developed for single-family residence and classified R-2; tract C was to be developed for general residence (multifamily) and classified R-3; and tract D was to be developed as a business district and classified B-2 subject to special uses. The agreement provided that the zoning ordinance in effect at that time would apply until the property was completely developed, "but in no event beyond five (5) years" from the date of the agreement. The agreement further stated that it would be binding for a "period of five (5) years from the date of execution." At the time the agreement was executed, Illinois law provided that annexation agreements were limited in duration to five years. Ill. Rev. Stat. 1971, ch. 24, par. 11-15.1-1.

In 1973, the Illinois legislature extended the limitation period for annexation agreements from 5 to 10 years. (Ill. Rev. Stat. 1973, ch. 24, par. 11-15.1-1.) The amended statute provided that previously executed annexation agreements were valid and enforceable for the effective period of the agreement or for 10 years from the date of execution, whichever was shorter. (Ill. Rev. Stat. 1973, ch. 24, par. 11-15.1-5.) However, the amended statute further provided that a previously executed annexation agreement could be extended at any time prior to its original date of expiration to a date of not more than 10 years from the date of its execution. (Ill. Rev. Stat. 1973, ch. 24, par. 11-15.1-5.) The record does not indicate any formal action by the Village to extend the duration of the 1970 agreement either before or after the original expiration date of November 3, 1975.

On October 1, 1974, the Village amended Itasca Zoning Ordinance No. 134 -- 59 so as to permit the development contemplated in the annexation agreement. Development on tracts A and B began prior to the agreement's expiration. On May 1, 1976, the Village entered into a "Detention Basin Purchase Agreement" with the developer and an agent for plaintiffs for construction of a water detention basin. Although the water detention basin was not to be constructed on any of the property encompassed in the annexation agreement, it was contemplated that construction of the basin might require use of the property for storage of fill. The water detention basin and the development of 165 dwellings on tracts A and B were completed in the summer of 1977.

In January 1978, the Village adopted a resolution declaring that the 1970 annexation agreement was no longer binding. The Village thereafter scheduled a meeting to consider down -- zoning the property encompassing tracts C and D. Plaintiffs brought an action to prevent the Village from down -- zoning the property, but that action was dismissed on the basis that it was premature.

On May 9, 1978, plaintiffs submitted a plan for the development of tract C. The Village did not approve the submitted plan, and, on January 23, 1979, plaintiffs brought the underlying action seeking to enjoin the Village from denying the continued validity of the annexation agreement. Plaintiffs alleged that the Village's conduct in 1974 zoning the property to comply with the uses contemplated in the annexation agreement and its further permitting development on tracts A and B and construction of the water detention basin through 1977 barred the Village from denying the continued validity of the annexation agreement as to tracts C and D.

On December 4, 1979, the trial court issued a memorandum of decision. The court noted that plaintiffs and the Village relied on the continued operability and enforceability of the annexation agreement through November 3, 1975. However, the court found that construction of the water detention basin was responsible for delaying the development of plaintiffs' property beyond that date. Thus, the court concluded that, at least through September 1977, plaintiffs and the Village conducted themselves and each dealt with the other as if the annexation agreement were in continuing full force and effect. The court found that the annexation agreement was a viable contract until November 3, 1980. On December 19, 1979, the trial court entered an order in accordance with the terms of its memorandum of decision and extended the life of the annexation agreement to November 3, 1980. That order further stated that the extension was in accordance with the 10-year statutory limitations period then applicable to annexation agreements. On May 16, 1980, the court entered a second order recognizing an expiration date of November 3, 1980, and directing plaintiff to proceed with the development of tracts C and D "to the point of application for at least one building permit on each of the parcels" by that date.

On November 3, 1980, plaintiffs applied for a building permit for the development of a single-story office building on tract D. Plaintiffs did not pay the permit fee, and a dispute arose over issuance of the permit.

On September 9, 1981, the court entered an order directing the Village to issue plaintiffs a permit on payment of the fee for their planned development of the single-story office building on tract D. That order further enjoined the Village from interfering with plaintiffs' development of tract D and provided that the annexation agreement "shall not be terminated by either party without court order." The court continued the matter for further proceedings. The ...


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