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General Auto Service Station v. City of Chicago

May 16, 2008


Appeals from the United States District Court for the Northern District of Illinois, Eastern Division No. 00 C 368-Rebecca R. Pallmeyer, Judge.

The opinion of the court was delivered by: Rovner, Circuit Judge.


Before RIPPLE, ROVNER, and SYKES, Circuit Judges.

The plaintiffs-appellants are the owners and the agent of a building in Chicago that for more than four decades has displayed an advertising sign without a permit. Current zoning provisions prohibit the sign given its size and proximity to a residential district, but the plaintiffs contend that because the sign was lawful when first erected, they have a right to continue displaying the sign. After the City of Chicago declared the sign unlawful and ordered it removed, the plaintiffs-appellants filed suit under 42 U.S.C. § 1983 challenging the City's action on a variety of constitutional grounds. The district court resolved the suit in the City's favor. We affirm.


Bernard A. Heerey purchased the building located at 1127-33 North State Street in Chicago in 1961. Pursuant to a 1984 trust agreement, Cosmopolitan Bank and Trust now holds legal title to the property. Heerey assigned his beneficial interest in the property to General Auto Service Station, an Illinois corporation which in 1998 merged with and into General Auto Service Station LLC (collectively, "GASS"). F.A.Y. Properties, Inc. ("F.A.Y.") is an Illinois corporation that acts as an agent and lessor for GASS. Heerey was the sole owner of both GASS and F.A.Y. Heerey died in 1999 at the age of 79 without immediate family to survive him. The terms of his will provide that once certain bequests are made, the assets in his estate, which include a number of properties on Chicago's north side, are to be placed in a charitable trust in order to fund distributions to religious and charitable organizations. As of the date this case was tried in December 2004, the probate of Heerey's estate was ongoing and the trust had not yet been funded.*fn1

The south exterior wall of the building at 1127-33 North State Street is a desirable location for advertising. The building is four stories tall, and soon after Heerey purchased the property, the buildings to its immediate south were torn down, eventually to be replaced by a one-story building. As a result, the exposed south wall of the building at 1127-33 North State is visible to motorists and pedestrians passing through the nearby intersection of North Rush and State Streets, in the heart of Chicago's Gold Coast.

In 1962, Heerey, without first seeking or obtaining a permit from the City, had an advertising sign painted on the south wall of the building. That wall has been continuously used for advertising since that time. In the ensuing years, Heerey and later GASS, through F.A.Y., leased the advertising space on the building to a variety of entities, including Whiteco Industries, Inc., whose successor, Lamar Advertising Company, holds the current lease. We shall refer to these lessees collectively as "Whiteco." For the one-year period ending July 14, 2008, GASS is being paid $99,074.48 for the lease of the sign.

When Heerey first began using the side of his building for advertising in 1962, section 86.1-4 of the City's electrical code provided in relevant part that "[i]t shall be unlawful to proceed with the erection, enlargement, alteration or rehang of any illuminated sign or illumination of signboard unless a permit therefore shall have first been obtained from the Commissioner of Buildings." The district court understood this language to require a permit only for an illuminated sign. Because the original sign on Heerey's building was not illuminated, the court concluded that no permit was required. R. 126 at 16. The City accepts that ruling for purposes of this appeal, as do we.

At all times relevant to this suit, the property at 1127-33 North State Street has been located within a district zoned by the City for business use. However, the sign on the south wall of the building has always been within 75 feet of a district zoned for residential use.

As of 1962, section 8.9(5) of the City's zoning ordinance prohibited advertising signs "within 75 feet of any property in a Residence District." The district court took the phrase "any property" in this provision to mean any improved property. Although the sign on Heerey's building is within 75 feet of a residential district, when first erected it was not within 75 feet of any improved property in such a district. Consequently, the court assumed that the sign was lawful when first painted on Heerey's building. R. 126 at 15. Although the City contested this point below, it has not quarreled with the district court's assumption for purposes of this appeal. Consequently, we like the district court shall assume that the sign was lawful when first erected.

In subsequent years, however, Heerey made two changes vis-à-vis the advertising on his building for which a permit was indubitably required under the then-governing terms of the City's electrical code. First, at some point between 1962 and 1969, Heerey illuminated the sign by installing lights near the roof line of his building. Section 86.1-4 of the code, which we quoted from above, required that a permit be issued by the Commissioner of Buildings for, among other things, the "erection" of an illuminated sign and the "illumination of signboard." Second, between 1975 and 1979, Heerey allowed the lessee of the advertising space on his building to combine what had been two signs into a larger, single sign by covering the building windows that had separated the two signs. Then, in 1979, that sign was enlarged to its current dimensions of 26 feet by 59 feet. These changes again triggered the permit requirement of section 86.1-4, which applied to any "enlargement" or "alteration" made to "any illuminated sign." The district court thus concluded that Heerey was required to obtain a permit before illuminating and enlarging the signage on his building. R. 126 at 16-17. So far as the record reveals, Heerey did not obtain a permit before he made any of these modifications.*fn2

In 1986, the City finally took notice that the sign lacked a permit. On September 3 of that year, it issued a violation notice to Heerey's property management company asserting that the illuminated sign had been installed without a permit in violation of section 86.1 of the electrical code. App. 193. A hearing before the City's electrical compliance board was scheduled and continued on several occasions, but the City took no further action on the 1986 notice.

In 1990, the provision of the City's zoning ordinance regarding the distance between advertising signs and residential districts was toughened. Whereas before, section 8.9(5) of the ordinance (as construed by the district court) permitted no advertising sign within 75 feet of improved property in a residential district, section 8.9(7) of the revised ordinance now provided that "[n]o advertising sign having a face which exceeds 100 square feet shall be permitted within 250 feet of a Residence District" and that "no advertising sign" of any size "shall be permitted within 75 feet of a Residence District." App. 237. A "grandfather" provision, section 6.7-1(a), was added to the ordinance providing that any sign not conforming to the new distance requirements (among others) which had been "lawfully erected pursuant to a permit lawfully issued prior to the effective date of this section, may remain in use as a legal non-conforming sign." App. 227.*fn3

On September 29, 1994, the City issued a second violation notice to Heerey, this one charging that because the face of the sign was larger than 100 square feet and was within 250 feet of a residential district, the sign violated the distance requirement adopted in 1990. App. 113. Heerey's attorney forwarded the notice to Whiteco and asked that it handle the matter. Whiteco in turn submitted a permit application to the City. App. 113A. That application was approved initially by the City's zoning department on January 12, 1995. Zoning employee William Merritt determined that the sign was a "legal non-conforming" use, and he therefore stamped the permit application to indicate that the sign "conforms to zoning ordinance." App. 107 ¶ 36, App. 113B. At that point, the approval of the City's building department was required, and Whiteco submitted its permit application to that department for review. However, for any sign that exceeded 100 square feet in size, the municipal code required City Council approval in addition to a permit. App. 285. On April 19, 1995, the building department noted on a "plan correction sheet" issued to Whiteco that a copy of the Council's order approving the sign "must be attached to the permit application." App. 208. Whiteco had written to the City alderman whose ward included the State Street property one week earlier requesting his support and assistance in obtaining such approval. But for reasons that the record does not reveal, Whiteco never obtained an order from the City Council approving the sign. For its part, the City took no further action on Whiteco's 1994 permit application.

On August 22, 1997, the City issued a third notice of violation to Heerey's property management company directing Heerey to "[o]btain permit for outdoor flat building sign installed without permit." App. 108 ¶ 40; App. 116. Heerey's attorney again forwarded the notice to Whiteco asking that it handle the matter. Whiteco appeared as the respondent before the City's Department of Administrative Hearings on September 30, 1997, and admitted that it was not in compliance with the permit requirement. The hearing officer entered the following findings and order:

Respondent is found to be in violation of the Chicago Building Code with regards to the afore stated charges; however, Respondent afforded opportunity of mitigation via compliance. Compliance must be evidenced by reinspection and/or other evidence corroborating conditions. This matter is continued for hearing on fines . . . .

App. 117 (footnote omitted).

Whiteco subsequently attempted to bring the sign into compliance with the building code by applying for a permit, but its efforts met with failure. On April 21, 1998, the City's Zoning Administrator denied zoning certification for the sign on the grounds that the sign violated the provision of the zoning ordinance regarding the proximity of signs to residential districts and was not grandfathered because there was no prior permit for the sign on file. Given the lack of zoning certification, the City did not issue a permit for the sign. Whiteco appealed the denial of zoning certification to the City's Zoning Board of Appeals ("ZBA"), but the ZBA sustained the denial on September 14, 1998.

The following month, a City hearing officer entered a final order on the 1997 notice of violation imposing a fine of $250 and ordering Whiteco to remove the sign within 90 days in the event it did not obtain a permit. App. 161. By the terms of the City's zoning ordinance, GASS as the (effective) owner of the property is liable for the violation to the same extent as its lessee, Whiteco. The City's order has yet to be enforced; to this ...

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