No Vested Right to Build Condo Development in PMD District
In Morgan Place of Chicago, et al. v. City of Chicago, No. 1-09-1240, 1-10-0195 (June 29, 2012), an Illinois Appellate Court determined that the City was not equitably estopped from revoking a building permit for a condominium development. The court also determined that the developer did not have a vested right to the permit notwithstanding that the property was subsequently rezoned to a planned manufacturing district.
In 1993, Cedicci acquired land zoned in the M-2, light manufacturing district. Shortly after the purchase, the property was rezoned to the C-2, which would allow the owner to construct its proposed condominium building above a ground floor warehouse. In 1997, however, the City proposed rezoning the property to planned manufacturing district (PMD), which would allow manufacturing and commercial uses, but prohibit residential uses. Cedicci claims he was not notified of the PMD zoning change.
In 1998, Cedicci submitted a permit application to develop a mixed-use (condominium and warehouse uses) on the property. That application was approved by the zoning department, and a building permit was issued in 2000, notwithstanding that residential uses were not permitted in the PMD district.
Shortly after construction began in 2004, a City inspector issued a stop work order (SWO) on the basis that the initial building permit had been revoked for inactivity under the City's building code. Cedicci hired counsel to challenge the SWO, and the permit was eventually reinstated in 2004 upon recommndation of the City's corporation counsel, who expressed concerns about vested rights. One year later, the City revoked the building permit because the use did not comply with the City's zoning ordinance, and Cedicci filed a lawsuit claiming it had a vested right to continue with the development and the City was equitably estopped from enforcing the City's zoning ordinance. The trial court ruled in favor of the City, which was recently affirmed by the appellate court.
On the equitable estoppel claim, the Court determined that the City official who had reinstated the permit in 2004 on the recommendation of City counsel was not authorized to do so and the City could not be bound to that unauthorized act.
On the vested rights claim, the Court determined that the vested rights doctrine presupposes issuance of a legal building permit. In this case, the zoning of the property prohibited residential uses; thus the building permit was never legally issued. Furthermore, the Court determined that the expenditures made by the owner prior to the zoning change were not substantial enough to satisfy a vested rights claim.
Post Authored by Julie Tappendorf, Ancel Glink
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