By: Jacob Gancarczyk and Christian Spesia, Spesia & Ayers
For years, the game in condemnation proceedings for the condemnee has been delay. The strategy was the longer you could delay a project, the more the condemnor would pay in order for the project to proceed. A recent decision from the Fourth District Appellate Court has potentially changed the game in this regard.
On September 22, 2015, the Fourth District Appellate Court in Illinois Extension Pipeline Company, L.L.C. v. Troyer, 2015 IL App (4th) 150334 affirmed a trial court’s ruling, which granted an injunction that permitted Illinois Extension Pipeline Company, L.L.C. (IEPC), a certificated common-carrier by pipeline, to build its pipeline across 21 tracts of land in McLean County prior to a jury awarding just compensation.
IEPC, represented by Sidley Austin LLP and Spesia & Ayers in the proceedings, argued that because IEPC had already received authority from the Illinois Commerce Commission (ICC) – who had granted IEPC eminent domain as a common-carrier by pipeline – and the trial court had already denied the landowners’ challenge to that authority, the only issue that remained was just compensation. To delay construction would harm the public, cause significant increases in construction costs, and harm the reputation of a certificated common-carrier by pipeline. Additionally, IEPC took the position that the landowners would not be harmed because they will continue to enjoy full possession and use of their property during the construction. Lastly, IEPC agreed to deposit the full amount the landowners were seeking for the easements sought, and bond the full amount the landowners were claiming as remainder damages. Any amount deposited that exceeded the final award of just compensation would be returned to IEPC.
The landowners argued in opposition to the motion for access that the injunction was an unconstitutional taking and amounted to a “quick take.” The trial court did not agree, and the appellate court affirmed the trial court’s decision.
The Fourth District’s decision is significant for a several reasons. Initially, it allows for expedited proceedings as a condemning authority can seek an injunction for access and construction prior to the conclusion of the condemnation proceeding, even without “quick take” authority. The court recognized that despite the fact that IEPC did not have “quick take” authority; IEPC did not seek title or possession, but only sought access and the ability to construct the pipeline consistent with the trial court’s previous rulings. The court noted the partial taking of easement rights was not an “ordinary” condemnation proceeding and agreed with IEPC’s counsel that at the conclusion of the condemnation proceeding the landowners will still retain both title and possession of the property. Therefore, the court concluded that the injunction “did not amount to a regulatory taking” as it did not change the rights to use the property or deprive the landowners of all economically viable uses of the property.
Troyer, 2015 IL App (4th) 150334, ¶20.
[t]his is not an ordinary condemnation case. Landowners retain title to their land and will still retain title when these proceedings finally come to an end. Landowners also retain possession of the real estate and will still retain possession when these proceedings finally end. Under these circumstances, the trial court retained its equitable authority to order Landowners not to impede IEPC’s access to their property for pipeline purposes. Troyer, 2015 IL App (4th) 150334, ¶24.
Second, the court rejected the landowners’ argument that the injunction was unconstitutional, noting that the constitution does not require just compensation be paid in advance or contemporaneously with the taking. The court stated: “because the defendants were engaged in an adequate process for receiving just compensation for their property, immediate payment of compensation was not required.” Troyer, 2015 IL App (4th) 150334, ¶22.
Lastly, the court provided a roadmap to what a condemning authority must show in order to obtain the injunction, namely: (1) Authority–the appellate court stated that IEPC had already established its rights in the property as it obtained a certificate to build the pipeline and condemnation authority from the ICC; (2) Harm–the court agreed with IEPC that it would suffer harm due to increased construction expenses and harm to its reputation as a certificated common-carrier pipeline company; (3) Protection–the court stated that the landowners were protected because of the funds deposited by IEPC.
For condemning authorities seeking easement rights the decision out of the Fourth District indeed changes the game. The case gives condemning authorities another tool to consider with their legal counsel in determining how to properly and efficiently proceed in eminent domain. Most importantly, this decision reduces the landowners’ ability to delay and to hold a project hostage. A condemning authority seeking a partial take for easement rights may be able to obtain an injunction that will allow for construction to commence as long as the trial court has already determined they are authorized to proceed under eminent domain. This ability ensures that the process afforded to landowners is upheld to its true purpose – determination of just compensation – not a ploy in hopes of some “windfall” settlement.
In Troyer, the Fourth District Appellate Court has denied Defendants petition to reconsider its ruling. Under Illinois Supreme Court Rules Defendants may file a petition for leave before the Illinois Supreme Court, so stay tuned…