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On December 17, 2009, the Illinois Supreme Court issued a surprising and stunning decision on what kind of notice Illinois municipalities must provide when they rezone property. As applied to the facts of the case, the Court ruled that the City of Zion was required to provide actual notice to the rezoned plaintiffs notwithstanding the fact that the City had fully complied with all notice requirements set forth in the Illinois Municipal Code. A strongly worded dissent by Justices Freeman and Burke warned that "despite the majority's insistence that its holding is limited to the facts of this case, constructive [that is, newspaper publication] will, after today, never be deemed reasonable for purposes of procedural due process."
In the case, the City of Zion in 1996 decided to adopt a new zoning code for the entire municipality. As part of the adoption, 85 parcels in the City, including the plaintiffs' property, would be rezoned.
As required by Section 11-13-2 of the Illinois Municipal Code, 65 ILCS 5/11-13-2, the City provided newspaper notification of the proposed zoning action – one notice was published in a local community paper and a second notice was published in the Zion-Benton News. The required public hearing was held and the City adopted the new zoning code in June 1996, pursuant to which the plaintiffs' property was rezoned from R2 multifamily to R8 single family. There was no dispute that the City fully and strictly complied with all statutory and procedural requirements.
Subsequently, in 2001, Joseph Passalino (one of the plaintiffs and a resident of Lake Forest since 1963) sought to develop his vacant Zion property with multifamily residential units. The City informed him that multifamily was not allowed because the property was now zoned R8 pursuant to the 1996 rezoning.
Back in 1971, the previous owner had successfully petitioned the City to zone some of the property R8 (for eight single-family homes) and the rest of the property R2 (for the development of 142 multifamily units). In 1972, the plaintiffs (as beneficiaries of a land trust) acquired the property and over the next year or so constructed the eight single-family homes and 48 of the planned 142 multifamily units. By 1978, Passalino had sold all of the developed portions of the property, leaving him just with the balance of the R2 (multifamily) zoned property.
In 2007, Passalino and his wife sued the City in state court arguing that the 1996 rezoning of their property from R2 to R8 violated their federal procedural due process rights because the City had not provided them with actual (as opposed to newspaper) notice of the rezoning. The trial court agreed with the plaintiffs and the Illinois Supreme Court affirmed, finding that the rezoning notice provision of Section 11-13-2 of the Illinois Municipal Code was unconstitutional as applied to the facts and the plaintiffs in this case.
The Illinois Supreme Court analyzed the case under traditional due process jurisprudence, pursuant to which the notice required in each case is determined by balancing the practical interests and burdens of the City in providing notice against the private individual interests sought to be protected. The Court downplayed any burden on the City in making actual notice in this case. The Court found that the plaintiffs' address could have been "easily" obtained. Surprisingly, the Court placed particular weight on the fact that the plaintiffs had received tax assessment letters for many years on the property. Based on this fact, the Court concluded that "[a]mong the reasonable actions the City could have taken was to peruse the records of the Lake County collector and then mail notice to the record owners of the 85 properties affected." In light of the assessment notices and the fact that the plaintiffs had not actually seen the published notice, the Court held that "we do not believe that service was reasonably calculated to inform the plaintiffs of the pendency of the zoning matter."
Importantly, the decision was based on the Court's analysis of federal due process standards for rezoning actions. Nevertheless, the Court utterly ignored the Seventh Circuit's analysis regarding the process due in rezoning cases under the United States Constitution. In River Park, Inc. v. City of Highland Park, 23 F. 3d 164 (7th Cir. 1994), Judge Easterbrook observed that "[z]oning restrictions are not the measure of property interest but are legal restrictions on the use of property." 23 F. 3d at 166 (emphasis in original). On that basis, the Seventh Circuit determined that "the procedures 'due' in zoning cases are minimal. Cities may elect to make zoning decisions through the political process ... with no hearings of any kind." Id., citing Eastlake v. Forest City Enterprises, Inc., 426 U.S. 668 (1976). Despite this precedent, the Illinois Supreme Court undertook its own federal due process analysis without any meaningful discussion about the property interest (if any) affected by a rezoning.
The strongly-worded dissent identified three key deficiencies in the Court's ruling.
First, there is almost no analysis in the majority's opinion of the nature and extent of the plaintiffs' property interest at stake in the rezoning. This is a glaring omission because, as the dissent rightly points out, landowners have no right to the continuation of existing zoning, particularly, as in this case, where no money was expended in reliance on the existing zoning and no building permits were issued or pending at the time of the rezoning.
Second, the plaintiffs are the beneficiaries of a land trust which holds legal and equitable title to the property. As such, plaintiffs' names would not appear as an owner of record and a title search or a tax records search would most likely only reveal the name and address of the trustee and not of the plaintiffs. This obviously calls into question the majority's conclusion that it would have been "easy" for the City to mail notice to the plaintiffs.
Finally, the dissent correctly concludes that it will be difficult if not impossible to limit the majority's opinion to the specific facts of this case. The majority opinion leaves open many questions, such as:
As the dissent notes, "these questions need to be answered or else municipalities will never be certain when constructive notice, as the statute permits, will be sufficient to satisfy due process."
Until there is further clarification on the ramifications of this decision, we can determine with you the appropriate notice required for particular rezonings. Unfortunately, under the majority's decision, these determinations will now have to be made on a case-by-case basis.
We believe that the majority opinion was decided in error. It is our understanding the City of Zion is preparing a motion for rehearing in an attempt to have the Court reconsider its decision. As we have in similar instances in the past, we recommend that our municipal clients authorize us to file on their behalf an amicus brief in support of the motion for rehearing. This will give us the opportunity to fully explain the nature and extent of the failings of the majority decision in this important and unexpected decision. Due to the broad impact of this decision on our municipal clients, our attorneys will prepare the brief without charge to our clients.
