AGOLF, LLC v. Village of Arlington Heights

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State: Illinois

Court: 1st District Appellate

Docket No: 1-10-1599 Rel

Case Date: 04/15/2011

Preview:FIFTH DIVISION April 15, 2011

No. 1-10-1599

AGOLF, LLC, an Illinois Limited Liability Company, Plaintiff-Appellant, v. THE VILLAGE OF ARLINGTON HEIGHTS, a Municipal Corporation, Defendant-Appellee.

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Appeal from the Circuit Court of Cook County. No. 06 CH 18560

The Honorable Nancy J. Arnold, Judge Presiding.

PRESIDING JUSTICE FITZGERALD SMITH delivered the judgment of the court, with opinion. Justices Joseph Gordon and Howse concurred in the judgment and opinion. OPINION Plaintiff-appellant Agolf, LLC, an Illinois limited liability company (plaintiff), brought suit against defendant-appellee the Village of Arlington Heights, a municipal corporation (defendant), seeking declaratory judgment and injunctive relief involving a redevelopment project. It later filed an amended complaint which added constitutional claims. Defendant moved for summary judgment based on res judicata, and the trial court granted its motion. Plaintiff appeals, contending that the trial court erred in granting summary judgment on the ground of res judicata because that doctrine was inapplicable and inequitable in the instant cause. Plaintiff asks that we

No. 1-10-1599 reverse the trial court's grant of summary judgment in whole or, alternatively, that we reverse it at least as to the constitutional claims it asserted in its amended complaint, and that we remand the cause for further consideration on the merits. For the following reasons, we affirm. BACKGROUND Defendant implements a TIF district. Plaintiff purchased International Plaza (the Plaza) shopping center in 1995, near the intersection of Arlington Heights Road and Golf Road in Arlington Heights, Illinois. Surrounding the Plaza were several commercial lots, single-family homes, businesses, residential lots, and a gas station; some of these were occupied while others had been abandoned. Also, southwest of the Plaza sat a small shopping center operated by Arlin-Golf, LLC (Arlin-Golf). Over the years, plaintiff negotiated multiple leases with several tenants for the occupation of space in its Plaza, among them Capital Fitness of Arlington Heights, Inc. (Capital Fitness), which operated a health club. Capital Fitness's lease with plaintiff at the Plaza was for 11 years commencing in 1997, with options to renew until August 2016. In January 2002, defendant announced that it would be implementing a tax increment financing (TIF) district as part of a redevelopment project. The plan for this project targeted the redevelopment of a substantial area around Arlington Heights Road and Golf Road and included the property on which the Plaza sat, as well as the property to the southwest owned by ArlinGolf. Defendant designated and implemented the TIF district via ordinance on July 1, 2002. Capital Fitness brings suit. Immediately thereafter, in July 2002, Capital Fitness filed a two-count cause of action

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No. 1-10-1599 against defendant, seeking an injunction and declaratory judgment. See Capital Fitness of Arlington Heights, Inc. v. Village of Arlington Heights, 394 Ill. App. 3d 913, 917 (2009). It requested an order prohibiting defendant from using its powers to condemn the property under the Tax Increment Allocation Redevelopment Act (Act) (65 ILCS 5/11-74.4-1 et seq. (West 2002)), a declaration that the designation of the redevelopment project area was invalid, a declaration that the Plaza should not be included in the project, and damages. Following the filing of a first amended complaint, the trial court entered an order dismissing count I of Capital Fitness's complaint (for injunctive relief), but allowed count II (for declaratory judgment) to proceed. Capital Fitness eventually filed a second amended complaint, alleging that the redevelopment project area did not meet the requirements for the implementation of a TIF plan, that defendant failed to demonstrate that the project area was not subject to growth, and that defendant's plan was improper. See Capital Fitness, 394 Ill. App. 3d at 918. The cause proceeded to trial in 2006, during which some 14 witnesses testified regarding the project, its planning, and the land in question. See Capital Fitness, 394 Ill. App. 3d at 918. Among those who testified on behalf of Capital Fitness in its suit against defendant was Su-Chuan Hsu, plaintiff's president and manager of the Plaza. She testified regarding the financial condition of the Plaza, including its revenues, occupancies, rents, property tax increases, and the equalized assessed value of the land. She averred that she, and a representative that she had hired, attended several public meetings concerning defendant's TIF plan and ordinance, including a village board meeting in early March 2002, a joint review board meeting in late March 2002, and a redevelopment commission meeting in April 2002. Hsu stated that her representative, with her

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No. 1-10-1599 authority, spoke at these meetings against the TIF district. She further testified that in May 2002, she hired a lawyer and that the two of them, along with his partner, attended a village board meeting in June 2002 during which they made statements regarding, again, the financial condition of the Plaza and their opposition to defendant's plan. Finally, Hsu testified that plaintiff had recently filed suit against defendant over the TIF district and that plaintiff's suit, just as Capital Fitness's suit against defendant, sought to declare the TIF district invalid. After a lengthy examination of Capital Fitness's allegations, the Act's statutory factors and the evidence presented, the trial court, in January 2007, found that Capital Fitness had not met its burden in its cause, that defendant had not abused its discretion in designating the Plaza as part of its redevelopment plan, and that defendant's project complied with all necessary requirements. Therefore, the trial court denied Capital Fitness's request for declaratory judgment, holding that the TIF ordinance implemented by defendant was proper. See Capital Fitness, 394 Ill. App. 3d at 918. Capital Fitness appealed its cause to our court. In a decision issued in September 2009, we affirmed the trial court. See Capital Fitness, 394 Ill. App. 3d at 935. Again, after reviewing the Act, its factors and the pertinent evidence regarding the land involved, we found that Capital Fitness had failed to establish that defendant had abused its discretion in any way. Specifically, we addressed the land on which the Plaza sat in relation to statutory blighting factors relevant to improved areas, including obsolescense, deterioration, excessive vacancies, inadequate utilities, deleterious land use or layout, and lack of community planning; statutory blighting factors relevant to vacant areas; and conformance with defendant's project plan. See Capital Fitness,

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No. 1-10-1599 394 Ill. App. 3d at 920-35. Following this examination, we held that the trial court's decision denying Capital Fitness' request for declaratory judgment, and instead holding for defendant, was not against the manifest weight of the evidence. See Capital Fitness, 394 Ill. App. 3d at 921-22. Capital Fitness sought review of our decision in the Illinois Supreme Court, which denied its appeal. See Capital Fitness Arlington Heights, Inc. v. Village of Arlington Heights, 234 Ill. 2d 518 (2009). Arlin-Golf also files suit. Meanwhile, in 2006, while Capital Fitness' cause against defendant was pending, ArlinGolf, owner of the shopping center southwest of plaintiff's Plaza, also filed suit against defendant in Illinois state court. See Arlin-Golf, LLC v. The Village of Arlington Heights, 631 F.3d 818 (7th Cir. 2011). As Capital Fitness' suit, Arlin-Golf's suit, too, alleged that defendant's implementation of the TIF district was improper under the Act. It also claimed that defendant had violated the Illinois constitution by committing an improper taking. In September 2008, ArlinGolf voluntarily dismissed its suit with prejudice. However, in 2009, Arlin-Golf sued defendant in federal court via a 10-count complaint, alleging that defendant's conduct caused Arlin-Golf to suffer financial losses. Defendant filed a motion to dismiss based on res judicata in relation to Arlin-Golf's prior state suit, and the district court granted its motion. Arlin-Golf appealed. See Arlin-Golf, 631 F.3d at 819-20. Following a thorough review of the doctrine of res judicata, the Arlin-Golf court affirmed the judgment of the district court in favor of defendant. See Arlin-Golf, 631 F.3d at 821-22. Specifically, applying Illinois law, it concluded that Arlin-Golf's federal suit was barred by its

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No. 1-10-1599 prior state suit because, not only were the same parties and their privies involved, but also both causes relied on the same operative facts

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