Cruz et al. v. Town of Cicero

• Decision Date: 19 December 2001
• Docket Number: Nos. 00-3406,01-2337,s. 00-3406
• Citation: 275 F.3d 579
• Parties: (7th Cir. 2001) Sylvia Cruz, et al.,Plaintiffs-Appellees, v. Town of Cicero, Illinois, Defendant-Appellant
• Court: U.S. Court of Appeals — Seventh Circuit

Page 579

275 F.3d 579 (7th Cir. 2001)

Sylvia Cruz, et al.,Plaintiffs-Appellees, v. Town of Cicero, Illinois, Defendant-Appellant.

Nos. 00-3406, 01-2337

In the United States Court of Appeals For the Seventh Circuit

Argued April 10, 2001.

Decided December 19,2001.

Appeals from the United States District Court for the Northern District of Illinois, Eastern Division. No. 99 C 3286--George W. Lindberg, Judge. [Copyrighted Material Omitted]

[Copyrighted Material Omitted] Arthur L. Klein (submitted), Robert D. Butters, Arnstein & Lehr, Chicago, IL, for appellee.

Mark H. Sterk (submitted), Odelson & Sterk, Evergreen Park, IL, Nicholas Geanopoulos, Chicago, IL, for appellant.

Before Coffey, Rovner, and Diane P. Wood, Circuit Judges.

Diane P. Wood, Circuit Judge.

Armando Gonzalez, Michael Adams, and Victor Satas were in the business of condominium conversions in Cicero, Illinois. In 1999, they suddenly encountered obstacles thrown in their path by the Town of Cicero. They believed that Cicero, through its president Betty Loren- Maltese, was applying the laws to them in an unconstitutional manner. Together with a number of other people, they sued the Town, claiming that it had violated their Fourteenth Amendment equal protection rights, and a jury awarded them a verdict of $402,000. Cicero responded first with motions for a judgment as a matter of law and a new trial, and then with the appeal in No. 00-3406. We affirm that judgment of the district court. Appeal No. 01-2337, which we consolidated with the first in our order of June 6, 2001, concerns the district court's award of attorneys' fees and costs in favor of the plaintiffs in the principal case. Finding no abuse of discretion, we also affirm that order.

I

Once a jury has rendered a verdict, we view the evidence in the light most favorable to that verdict. The account of the relevant facts that follows should therefore be understood in that light. In 1996, Gonzalez and the other appellees (to whom we shall refer collectively as the Gonzalez parties, unless the context otherwise requires) began purchasing old multi-family apartment buildings in Cicero. They rehabilitated the units in those buildings and then sold the units individually as condominiums. Their only significant competitor in the condominium conversion business was Joe Pav, a well- established figure in Cicero's real estate community and, not coincidentally, the former boss and continuing ally of Betty Loren-Maltese.

Before any person in Cicero sells a piece of property, she must obtain a "real estate transfer stamp" from the Town. The first step toward obtaining the stamp is for the seller to apply for and receive a "certificate of compliance" for the property from Cicero's Building Department. When a property seller submits a request for a certificate of compliance, the Building Department dispatches an inspector to the property to ensure that it is in full compliance with all relevant codes and zoning rules. In the normal course, once an inspector determines that a piece of property is in compliance, issuance of a certificate is a mere formality. The Building Commissioner merely verifies that the inspector found no problems and then directs that the certificate be issued.

Until early 1999, Cicero imposed the same permitting requirements on everyone, including the Gonzalez parties and Pav, and no one was having any trouble passing inspections and getting certificates of compliance for his rehabilitated units. Prior to February of 1999, the Gonzalez parties applied for and received building permits to do restoration work on the units in their buildings and, when the units were ready to be sold, Cicero issued certificates of compliance and real estate transfer stamps. By September of 1998, the Gonzalez parties had sold fifty units in four buildings. Cicero also initially issued certificates of compliance for the units in two of the six buildings that are the subject of this litigation--the Grace and the Warren Park. The Gonzalez parties received certificates for all the units in these two buildings but did not sell four available units before the certificates expired. Then the trouble began.

The first sign that all was not well came with Gonzalez's original application for certificates of compliance for the units in the Albright, Anna, and Daniel buildings in early February of 1999. Initially, the Building Department simply failed to respond to their applications. When Gonzalez inquired about scheduling inspections, the clerk of the Building Department informed him that his applications had been transferred to the Town's Legal Department. There he was advised that he needed to apply to the Town Board for legal non-conforming use designations for the buildings. This was a curious determination given that Gonzalez had only recently purchased the buildings and the sellers had received certificates of compliance and real estate transfer stamps without difficulty. Not wanting to cause trouble, Gonzalez applied for non-conforming use designations and ultimately received them.

After obtaining the non-conforming use designations, Gonzalez again approached the Building Department about scheduling inspections for the affected units. Inspectors were dispatched to the buildings and filed reports concluding that the units were in compliance with all relevant codes. According to established practice, this should have ended the matter. In fact, both the former Building Commissioner and the Director of Code Enforcement testified at trial that following the inspections they would normally have issued the certificates as a matter of course. But the certificates did not materialize. Gonzalez made inquiries at the Building Department and was again referred to the Legal Department. This time the assistant town counsel told Gonzalez that Loren- Maltese "wanted to know where [their] condominium approval was."

This request was perplexing. Cicero at that time did not have a condominium ordinance, much less any established procedure for acquiring "condominium approval." Not surprisingly, therefore, the Gonzalez parties had not been required to seek any such approval for any of the units they had sold over the previous year. Nonetheless, again trying to be accommodating, Gonzalez sent Loren- Maltese a letter seeking condominium approval. Loren-Maltese put the issue on the agenda of the next Town Board meeting.

At that meeting, Loren-Maltese made another unprecedented request. She wanted to know if appellees had 1.5 parking spaces for each of the condominium units that they intended to sell. The Gonzalez parties had received separate certificates of compliance for 50 similar units over the past two years without ever having to show the existence of 1.5 parking spaces per unit. And parking had never before been cited as a problem with the current batch of units-- including the units at the Grace and the Warren Park, which already had received certificates of compliance once. Loren-Maltese claimed that the parking requirement was part of a zoning provision that had been on the books long before Gonzalez began doing condominium conversions. That ordinance required 1.5 parking spaces per unit constructed or "substantially altered" after 1977.

The buildings owned by the Gonzalez parties had been constructed before 1977, and the phrase "substantially altered" had never before been interpreted to include the kinds of renovations they had made. Among other things, they had not added units, changed the configuration of the units, or made any other structural changes to the buildings. In essence, they had made cosmetic improvements and were proposing to change the ownership structure of the buildings. The renovations on the six buildings for which Gonzalez was now allegedly required to provide parking were no different from the renovations he had completed on the other buildings that had received certificates of compliance without difficulty. At trial, no Cicero official, including Loren-Maltese, could define "substantially altered."

Following the Town Board meeting, Loren- Maltese directed the Economic Development Committee to determine how much parking was available at Gonzalez's buildings. Gonzalez never contended that he could satisfy the 1.5 spaces requirement, so it was no surprise when the Economic Development Committee reported to the Town Board that the number of spaces fell short of the alleged requirement. Loren- Maltese thereupon instructed Gonzalez that he could not sell the units unless he obtained a variance from the Zoning Board, which was headed by her friend and long-time political supporter Anthony Accardo. Gonzalez dutifully applied for the variances but was turned down. This had the effect of shutting down his condominium conversion business.

To someone unaware of Cicero's history, all of these new requirements and shifting standards might have appeared rational enough but for two anomalies. The first was that at the same time that the Gonzalez parties were being subjected to the new regime, Joe Pav and others continued to do business under the old rules. Between February and April of 1999, Pav applied for certificates of compliance for units in his Morton Park building. This was an old multi-family rental building that Pav had rehabilitated and (like the Gonzalez group) was now selling as individual condominiums. The project was completed with much fanfare, including a ribbon- cutting ceremony personally attended by Loren-Maltese. Pav's applications for certificates of compliance for these units sailed right through the Building Department, without any detours to the Town Hall or the Legal Department. Inspectors were promptly dispatched and reports were issued finding the units to be in compliance. Finally, Pav received certificates approved by Loren-Maltese's self-described "best friend," Mary Lynn Chlada, the head of the Building Department. Pav was not required to obtain "condominium...