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Chicago Limousine Service, Inc. v. City of Chicago

November 12, 2002


Appeal from the Circuit Court of Cook County. No. 97 CH 12428 Honorable Paul P. Biebel, Judge Presiding.

The opinion of the court was delivered by: Justice Gordon


The instant cause of action stems from a complaint filed by Chicago Limousine Services, Inc. (plaintiff), against the City of Chicago (defendant) related to livery licenses issued by defendant from 1987 through the pendency of this suit. In the complaint, which had six counts, plaintiff alleged that: (1) livery licenses issued by defendant after April 1, 1987, were unlawful in that they exceeded the statutory limit and were issued without a public hearing where it was determined that public convenience and necessity warranted their issuance; (2) the licenses should be declared null and void; (3) defendant breached a contract with plaintiff when issuing the additional licenses; (4) even if a contract was not in effect, plaintiff substantially relied on defendant's representations concerning the number of licenses that could lawfully be issued, and therefore, the issuance of additional licenses was inequitable and unjust; (5) plaintiff has vested property rights in its livery licenses and the issuance of additional licenses violated plaintiff's constitutional rights without due process of law or just compensation; and (6) plaintiff's contractual right to a fixed amount of livery licenses was unconstitutionally impaired by defendant's failure to conduct a public hearing regarding the issuance of additional licenses. Although the complaint alleged six counts of wrongdoing on the part of defendant, plaintiff only appeals the dismissal of counts III and IV in this appeal, which related to contract breach and promissory estoppel, respectively. Plaintiff now asserts that counts III and IV were improperly dismissed because both alleged viable causes of action. For the foregoing reasons, we affirm the judgment of the trial court.


The facts of this case are largely undisputed. In 1951, the City passed the public passenger vehicle ordinance (the ordinance or livery ordinance), which set forth procedures for issuing livery licenses in the City of Chicago and limited the number of licenses available for issuance to 370. The ordinance provided that additional licenses would not be issued "unless, after public hearing, the council [Chicago city council], by ordinance, shall determine that public convenience and necessity require additional service." Chicago Municipal Ordinance § 28-8 (December 20, 1951). *fn1

The livery ordinance in question was amended at least six times from its inception in 1951 until 1988, when the cap on the amount of livery licenses authorized for issuance was lifted. In 1952, it was changed to give the commissioner of public vehicle licensing, rather than the city council, the authority to determine whether public convenience and necessity would require additional licensing. Chicago Municipal Ordinance § 28-19 (amended January 30, 1952). Thereafter, in 1959, the ordinance was changed to adopt standards set forth in section 28-22.1 for public convenience and necessity hearings conducted to increase limits on taxicab licenses. Section 28-22.1 provided procedural guidelines related to notice of hearing and witness testimony and listed the considerations necessary to make a convenience and necessity determination. Chicago Municipal Ordinance § 28-19, 28-22.1 (amended August 24, 1959).

In 1963, section 28-22.1 of the ordinance, which now set forth the guidelines for conducting a public necessity and convenience hearing for both taxicab and livery licenses, was altered. The new version of section 28-22.1 required licensees to submit "a sworn statement of all gross fares collected and of all operating expenses" for a period of 12 months prior to the hearing. Chicago Municipal Ordinance § 28-22.1 (amended July 1, 1963). Whereas licensees were previously given the right to call witnesses and to be "heard", they were now given the explicit right to cross-examine witnesses and introduce evidence. Further, mathematical equations were set forth for calculation of the amount of licenses that could be authorized at any given time. In addition, section 28-33 of the ordinance provided that the provisions of the ordinance would not be changed for a period of five years. Chicago Municipal Ordinance § 28-22.1, 28-33 (amended July 1, 1963).

At the end of the five-year period, in 1968, the ordinance was reinstated without significant change for an additional five years. Chicago Municipal Ordinance § 28-33 (December 30, 1968). The facts presented by the parties indicate that plaintiff entered the livery business during the pendency of this five-year period and purchased six livery licenses in 1970.

In 1979, the ordinance was again amended. In this version, section 28-22.1, which governed the public necessity and convenience determination, provided that the commission was given the authority to override the previously implemented mathematic formula used to determine appropriate increases in livery licenses in the event that it determined that "public convenience and necessity will be served thereby." Chicago Municipal Ordinance § 28-22.1 (amended September 26, 1979).

In 1986, plaintiff purchased another limousine company and acquired additional licenses for a total of 31. The following year, the city council passed a further amendment that eliminated the need for a finding of public necessity and convenience as a precondition for issuing additional livery licenses. In fact, the standards previously articulated to aid in making this finding were deleted from the ordinance. The ordinance simply stated that the committee could, "from time to time conduct hearings to determine whether there should be additional taxicab or livery service." Aside from notice requirements, no further guidelines regarding these hearings were made part of the ordinance. Chicago Municipal Ordinance § 28-22.1 (amended April 1, 1987).

In 1988, the city council adopted another amendment, which provided for an incremental increase in the amount of livery licenses issued each year through 1992, with no cap on the number of licenses issued beyond that time. This amendment was adopted without a public hearing. Further, as a result of the amendment, hearings were no longer required to increase the number of livery licenses available for issuance. Chicago Municipal Code § 28-19 (amended January 27, 1988).

Plaintiff filed the instant six-count complaint in 1997, some nine years after the ordinance was last amended in 1988 to raise the limit of livery licenses that could be issued. The complaint alleged that the additional licenses provided under the 1988 amendment triggered the six causes of action alleged in the complaint, which included unlawful issuance of additional licenses, contract breach, promissory estoppel and the violation of vested constitutional rights in property and contract. Defendant filed a motion to dismiss the complaint pursuant to section 2-615 of the Code of Civil Procedure (Code) (735 ILCS 5/2-615 (West 2000)). After extensive briefing and a hearing on the motion, the trial court ruled in favor of defendant and dismissed all counts of the complaint. Counts III and IV, the subjects of the instant appeal, were dismissed pursuant to a finding that the ordinance was part of a general regulatory scheme and could not be construed as a contract, and on the basis that public policy is unfavorable to the concept of estoppel as it applies to governmental agencies and is only allowed in rare circumstances not present in the case at bar.


Before addressing the substantive merits of plaintiff's appeal, we first consider defendant's contention that plaintiff's claims are barred because they were not brought within the one-year statute of limitations for civil actions filed against government entities under the Local Governmental and Governmental ...

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