Blankner v. City of Chicago

Decision Date21 November 1974
Docket NumberNo. 73-1568-9,73-1568-9
Citation504 F.2d 1037
PartiesFrederika BLANKNER, Plaintiff-Appellant, v. The CITY OF CHICAGO et al., Defendants-Appellees.
CourtU.S. Court of Appeals — Seventh Circuit

David S. Kreisman, Thomas J. Grippando, Thomas J. Boodell, Jr., Lawrence M. Gavin, Chicago, Ill., for plaintiff-appellant.

James R. Thompson, U.S. Atty., and Gary L. Starkman, Asst. U.S. Atty., Chicago, Ill., Robert E. Kopp, Anthony J. Steinmeyer, Dept. of Justice, Washington, D.C., Jerrald B. Abrams, Asst. Atty. Gen., William J. Scott, Atty. Gen., Richard F. Babcock and Frederic O. Floberg, Richard L. Curry, Corp. Counsel and Daniel Pascale, Asst. Corp. Counsel, William R. Dillon, Herbert Morton, John O. Snook, Chicago, Ill., for defendants-appellees.

Before SWYGERT, Chief Judge, and FAIRCHILD and CUMMINGS, Circuit judges.

CUMMINGS, Circuit Judge.

In her complaint, plaintiff alleged that defendants conspired fraudulently to deprive her of her property without due process of law, thus contravening the Civil Rights Act. As a class representative, she also challenged the constitutionality of the Illinois Urban Renewal Consolidation Act of 1961 (Ill.Rev.Stats.1973, ch. 67 1/2, 91.101 et seq.) and requested the convening of a three-judge court to decide that question. The district judge refused to convene a three-judge court, and the defendants' motions to dismiss the complaint were subsequently granted pursuant to an extensive, unreported memorandum opinion. Thereafter, a motion for leave to file an amended complaint and for reconsideration was denied. We affirm.

The verified complaint was in four counts. The first count showed that plaintiff was the owner of an apartment house at 6043 South Woodlawn Avenue in Chicago. The building is presently occupied by plaintiff and her tenants It is located in the 66-acre South Campus portion of a 105.6-acre Urban Renewal Area and is immediately adjacent to the south end of the University of Chicago. Count I alleged a conspiracy between the University of Chicago and the Department of Urban Renewal of the City of Chicago. The University allegedly desired to acquire property south of its campus, while the City wished to receive credits under Section of 112 of the 1949 National Housing Act (42 U.S.C. 1463). Both goals could be accomplished if the University purchased urban renewal land from the municipality. The City's credits could then be used to finance unrelated renewal projects in other areas of the City.

Plaintiff charged that pursuant to this conspiracy, defendants falsely caused the Urban Renewal Area to be declared a slum and blighted area and acquired it by purchase and condemnation. The condemnation was allegedly effected by unfair procedures. The University purchased the South Campus at a below market price while the City acquired $14,000,000 of urban renewal credits.

The City applied for $12,000,000 in funds from the federal government in 1965 to defray the cost of acquiring this Urban Renewal Area property. It is accused of making false and inaccurate claims in this application that buildings, including plaintiff's, were slum and blighted. In 1967, the City began to purchase parcels within this Urban Renewal Area and later brought condemnation proceedings in the Circuit Court of Cook County to acquire additional parcels there. Plaintiff was named a defendant in a condemnation suit after refusing to sell her property to the City. In that litigation, she denied that the area was slum and blighted, that the City had a right to take it, and that the taking was for a public purpose. Judgment was entered for the City after a jury trial, resulting in a $40,750 award for Miss Blankner. She lost her appeal in the Supreme Court of Illinois (50 Ill.2d 69, 277 N.E.2d 129 (1971)), and her petition for certiorari was subsequently denied. 408 U.S. 931, 92 S.Ct. 2498, 33 L.Ed.2d 343. The condemnation of plaintiff's apartment house was allegedly obtained through false and fraudulent information supplied by the City, thus causing plaintiff's property to be appropriated for a private purpose.

In Count I, plaintiff requested declaratory and injunctive relief, including the invalidation of the condemnation judgment of the Circuit Court of Cook County. She also requested $250,000 in compensatory damages and $250,000 in punitive damages, plus attorney's fees.

Count II was brought as a class action. The members of the class were described as 'all property owners of the State of Illinois who are subject to having their property condemned for the purposes of urban renewal, without being afforded a fair hearing.' The gravamen of Count II was that the Illinois Urban Renewal Consolidation Act, as interpreted by the Illinois courts, violated the equal protection and due process clauses of the Fourteenth Amendment. In Count II, plaintiff alleged that neither she nor any other property owner in this Urban Renewal Area (except the University of Chicago) was given notice or an opportunity for a hearing until after an October 8, 1964, Resolution of the Chicago Department of Urban Renewal concerning this area and the City Council's November 16, 1964, ordinance adopting that resolution and approving the acquisition of this Urban Renewal Area pursuant to the Illinois Act. Plaintiff claimed that the Act unconstitutionally allowed the City of Chicago to establish the fact of slum and blight by the introduction of the resolution and ordinance. This count also alleges that the definition of 'slum and blighted area' (91.103(i)) is impermissibly vague, and that the Department of Urban Renewal is permitted to determine whether an area is slum and blighted despite its own pecuniary interest in the outcome.

Count III was also brought as a class action and noted that unlike 'conservation area' property owners, property owners living in a purported slum and blighted area are not afforded notice and a public hearing before their area can be designated for a renewal project. This was alleged to violate the equal protection clause.

Count IV, also a class action count, asserted that the condemnation procedure adopted under the Act constituted a bill of attainder.

Under the last three counts, the plaintiff and the class requested the convening of a three-judge district court, a judicial determination permitting the action to proceed as a class action, a declaration that the Illinois Urban Renewal Consolidation Act violates the federal Constitution, and an injunction against the taking of property under the slum and blighted area provisions of the statute.

Conspiracy Count

The district court held that the questions of law presented by the conspiracy count's allegation of unfair condemnation procedures were resolved against plaintiff in the state court proceedings. As more fully explained in the discussion of Count II, we agree.

Count I also alleged that defendants falsely and fraudulently caused the area in question to be designated a slum and blighted area. The fraud allegations are not merely conclusory; plaintiff alleges facts which suggest she would have had a strong case had she attempted to prove it in the state condemnation proceeding. Inexplicably, she declined to present any evidence there, so that this claim is also barred.

An essential element of plaintiff's fraud claim is that this Urban Renewal Area was not slum and blighted. If it were in fact slum and blighted, the defendants' motives in designating it for renewal would be irrelevant. Green Street Assn. v. Daley, 373 F.2d 1, 6 (7th Cir. 1967), certiorari denied, 387 U.S. 932, 87 S.Ct. 2054, 18 L.Ed.2d 995. Similarly, the conclusions of the report relied on by the condemnation court would be true, and the renewal project could proceed despite any fraudulent supporting statements. Plaintiff had an opportunity to litigate the slum and blight issue in the condemnation proceeding, but she deliberately bypassed it. See City of Chicago v. Walker, 50 Ill.2d 69, 70-71, 277 N.E.2d 129 (1971); City of Chicago v. Barnes, 30 Ill.2d 255, 257-258, 195 N.E.2d 629 (1964); City of Chicago v. Zwick, 27 Ill.2d 128, 188 N.E.2d 489 (1963); Ross v. Chicago Land Clearance Comm'n, 413 Ill. 377, 380-381, 108 N.E.2d 776 (1952); Zurn v. City of Chicago, 389 Ill. 114, 129-133, 59 N.E.2d 18 (1945); cf. Deerfield Park Dist. v. Progress Development Corp., 22 Ill.2d 132, 138-141, 174 N.E.2d 850 (1961).

If that proceeding were infected by fraud, plaintiff may or may not have a remedy. It is clear, however that any remedy lies not in federal court, but in a state court petition for relief from judgment under Ill.Rev.Stats. 1973, ch. 110, 72.

Plaintiff also argues that the fraud was only revealed by newly discovered evidence. That claim is also properly raised, if at all, in a state court petition under 72. We note, however, that the fraud charges were based in part upon separate studies of the South Campus area, published in 1962 and 1964. Parts of each study are attached to the complaint as Exhibits B and C respectively. The complaint also relies on an article by Julian Levi which appears to have been published in 1962, although that is not clear from the record, and on a map attached to the City's federal grant application in 1965. These items were complaint Exhibits A and D. At the very least, Exhibits B and C were public and could have been presented at the 1968 condemnation trial.

Also, in the condemnation proceeding, plaintiff had the opportunity to prove that her property was being taken for a private purpose but did not attempt to do so. This issue was raised by amici curiae, and the Illinois Supreme Court reiterated that the taking of land for the redevelopment of slum and blighted areas was for a public purpose. 50 Ill.2d at 71, 277 N.E.2d 129. Thus relitigation of this ground is barred too.

In this Count, plaintiff additionally asserts that the two federal defendant...

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