City Did Not Own Property Until Condemnation Proceedings Were Complete
In 2005, a city filed a lawsuit to acquire a low-income apartment complex through eminent domain proceedings. The case proceeded for 12 years, and the apartment complex continued to operate and the owners continued to pay property taxes. In 2018 (a year after the city acquired title to the property), the previous owners filed a tax objection complaint seeking a refund of over $6 million in property taxes they paid for the 12 year period between the filing of the eminent domain complaint and the date the city acquired the property. The trial court dismissed the case but the appellate court reversed and ruled in the property owners' favor, finding that the city "retroactively" owned the property from the date it filed its complaint and the property owners were entitled to a refund. That ruling was then appealed to the Illinois Supreme Court.
On appeal, the Illinois Supreme Court reversed the appellate court and held that the city did not become the owner of the property until the condemnation proceedings were complete. The Court overruled a previous case (City of Chicago v. McCausland) that held that a government's title "related back" to the filing of the complaint for purpose of determining who is responsible for liens that had been filed after a condemnation complaint but before the condemnation proceedings were complete. As a result, the Court held that the previous property owners were responsible for the property taxes during the 12 year period between the filing of the complaint and the completion of the condemnation proceedings as they were the lawful owners of the property until the city acquired title. MB Financial Bank, N.A. v. Brophy, 2023 IL 128252.
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