by John H. Kelly (Summer 2018)

A recent case from the Third District Appellate Court is raising questions about what information a court may consider when reviewing the legitimacy of annexations. In the case of Chicago Title Land Trust Company v. County of Will, 2018 IL App (3d) 160713, a landowner whose property was forcibly annexed by the Village of Bolingbrook after the Village annexed a Commonwealth Edison (“ComEd”) property to create contiguous boundaries to the Plaintiff’s property challenged the annexation as a “sham” transaction.

The Appellate Court, in a 2 to 1 decision, held that the Village’s annexation of the ComEd property was a “sham” and the resulting annexation of the plaintiff’s property was not valid. This case seems to be a departure from the holdings of other courts in which the intentions of the parties to an annexation agreement are not relevant to the transaction. In re Petition for Annexation to the Village of Bull Valley, 392 Ill. App. 3d 577 (2d Dist. 2009).

In late 2015, the Village of Bolingbrook approached ComEd with a proposal to voluntarily annex a parcel of ComEd property. The Village indicated to ComEd that the purpose of the annexation was to gain the ability to annex properties adjacent to its property. ComEd submitted a petition for voluntary annexation under Section 7-1-8 of the Illinois Municipal Code (65 ILCS 5/7-1-8). In its petition, ComEd asked that the annexation be “subject to the satisfaction of the Conditions Precedent and the Conditions Subsequent in the ComEd Annexation Agreement.” The Village and ComEd negotiated an extensive Annexation Agreement that spelled out a number of conditions, both precedent and subsequent, that the Village would have to meet in order for the annexation to be effective. Among those conditions was a provision that the Village could not place any additional restrictions on the ComEd property and, if the annexation of the contiguous property did not go through, then the ComEd annexation would be nullified. In addition, the Village promised that no Village regulations would be applied or enforced against the ComEd property. The Village also waived any fees or charges that might be associated with the annexation and agreed not to impose any taxes, other than property taxes, on the property.

On March 8, 2016, the Village of Bolingbrook adopted both the ordinance approving the Annexation Agreement with ComEd and the ordinance actually annexing the property. On April 12, 2016, the Village enacted an ordinance authorizing notice to the now-contiguous landowner of the Village’s intent to forcibly annex his property. On May 9, 2016, the landowner sent a written objection to the Village. The plaintiff’s objection alleged that the sole purpose of the Village’s annexation of the ComEd property-to annex his property by manipulating boundaries-was against Illinois public policy. On May 18, 2016, the Village forcibly annexed the plaintiff’s property under Section 7-1-13 of the Municipal Code (65 ILCS 5/7-1-13).

The plaintiff filed a quo warranto suit challenging the Village’s annexation of his property. A quo warranto complaint challenges the legal authority of a governmental body’s actions. In his complaint, the plaintiff alleged that the annexation of his property violated Illinois law and was contrary to public policy. The plaintiff argued that the Village had not annexed the ComEd property for typical purposes, such as increasing Village land, subjecting the property to its ordinances, or generating tax revenue. Instead, the sole purpose of this annexation was to gain contiguity and force annexation of the plaintiff’s property. The Village argued that the court should not look at the conditions under which the property was annexed, but only should review the legal basis for the annexation. If the conditions of the statute have been met, then the annexation should be deemed valid. After cross motions for summary judgement were filed, the trial court found for the Village, holding that the annexation was valid.

The plaintiff appealed to the Third District Appellate Court arguing that the annexation of the ComEd property was a “sham.” The Village renewed its argument that the focus of the annexation should be solely on whether the Village followed all of the necessary legal steps to perfect the annexation.

In its opinion, the court held that Illinois courts can and have considered “any matter going to the validity” of the annexation ordinance citing City of East St. Louis v. Touchettee, 14 Ill. 2d 243, 248 (1948). The court also cited a number of cases in which the courts have reviewed “creative” attempts by municipal governments to annex property, particularly where the annexation may provide contiguity to other desired property. The court reasoned that ComEd lacked any independent interest in being annexed into Bolingbrook. The court focused on the conditions spelled out in the Annexation Agreement, particularly the language allowing ComEd to disconnect if the Village was not successful in forcibly annexing the plaintiff’s property. The court ruled that the ComEd property annexation was a nullity, which means the plaintiff’s property was not “wholly bounded” by one or more municipalities, as required by Section 7-1-13 of the Municipal Code, and thus could not be forcibly annexed into the Village.

Municipal officials considering annexations, particularly those involving the reach for non-contiguous property, should heed the warnings of this case when negotiating with landowners to voluntarily annex and should prepare the annexation agreement in a manner that minimizes the chance that the annexation could be considered a “sham.” For assistance with annexation matters, contact your attorney.