Department of Conservation v. Franzen

• Decision Date: 15 October 1976
• Docket Number: No. 75--500,75--500
• Citation: 356 N.E.2d 1245,1 Ill.Dec. 912,43 Ill.App.3d 374
• Parties: , 1 Ill.Dec. 912 DEPARTMENT OF CONSERVATION of the State of Illinois, Plaintiff-Appellee, v. R. A. FRANZEN et al., Defendants-Appellants.
• Court: United States Appellate Court of Illinois

Page 1245

356 N.E.2d 1245

43 Ill.App.3d 374, 1 Ill.Dec. 912

DEPARTMENT OF CONSERVATION of the State of Illinois Plaintiff-Appellee, v. R. A. FRANZEN et al., Defendants-Appellants.

No. 75--500.

Appellate Court of Illinois, Second District, First Division.

Oct. 15, 1976.

Supplemental Opinion On Denial of Rehearing Dec. 3, 1976.

Burke & Weber, Chicgo, for defendants-appellants.

William J. Scott, Atty. Gen., Frank S. Righeimer, Jr., Asst. Atty. Gen., Patrick J Agnew and Leo N. Cinquino, Chicago, for plaintiff-appellee.

SEIDENFELD, Justice:

The defendants, LaSalle National Bank, as Trustee under Trust No. 23832 and S. A. Bowles, as Trustee under Trust No. 540, (record title holders of parcels of real estate described in the condemnation petition) and R. A. Franzen and William Ziegler, as beneficiaries under both trusts, appeal under Supreme Court Rule 308 (Ill.Rev.Stat.1973, ch. 110A, par. 308) from an interlocutory order denying leave to file a cross-petition for alleged damages to land not taken. The trial judge struck the cross-petition on the basis of his finding that there was no unity of title as to the parcel condemned and the alleged remainders. The defendants contend that where the property sought to be taken and that contiguous to it are held in title by separate land trusts but with common and identical beneficiaries, the part taken and the remainder are to be considered as one parcel for the purpose of determining damages to the remainder.

The eminent domain petition was filed on July 9, 1974 to acquire property for the expansion of the Chain of Lakes State Park. The petition described property here referred to as Parcels 11 and 12. The LaSalle Trust as record owner of Parcel 11 and the Bowles Trust as record owner of Parcel 12 were named as defendants. The cross-petitioner, R. A. Franzen, was made a party to the condemnation suit allegedly in his capacity as a taxpayer of record. The cross-petitioner, William Ziegler, was not made a party defendant.

The appearances of the LaSalle Trust, Bowles Trust and R. A. Franzen were filed on July 24, 1974. On June 25, 1975. the trial as to Parcels 11 and 12 was set for August 25, 1975. On July 16, 1975, the above named defendants, without leave of court, filed a cross-petition alleging that Parcels 11 and 12, consisting of 245 acres, are a part of a larger tract 'owned by said defendants' of which there is a remainder of approximately 167 acres in Parcel 11 (referred to in the briefs as the 'West Remainder') in the same LaSalle Trust and an additional 189.7 acre remainder contiguous to Parcel 11 (designated Parcel 7, and referred to as the 'North Remainder').

On August 7, 1975, petitioners filed a motion to strike the cross-petition alleging that it was not timely filed and that the title holders to Parcels 11 and 12 as well as Parcel 7 'are different for each of said parcels and there is therefore no unity of title * * *.' The court struck the cross-petition on the same date, with the finding that 'title to Parcels 11, 12 and 7 are in different trustees, and that there is therefore no unity of ownership.'

Ziegler and Franzen presented a second cross-petition on August 15, 1975 alleging that both Ziegler and Franzen were owners of the beneficial interests in the LaSalle and Bowles Trusts and that they were 'actual owners of Parcel 7' (the North Remainder), with fee title in F. C. Brehm, Trustee under Trust No. 630. Defendants' motion to reconsider was denied August 20, 1975. Defendants appeal from both the August 7th and August 20th orders.

Defendants essentially argue that the fact that Franzen and Ziegler have title to the North Remainder (Parcel 7) in a separate land trust from those holding title to the condemned parcels does not preclude their claim for damages. They reason that those with beneficial interests are in fact the proper parties to sue even though they do not have legal title; that a cross-petition may be filed by one other than a necessary party, i.e., by the beneficiary or beneficiaries of a land trust; that unity of use between the part taken and the remainder is not an essential element of a cross-petition; but that in any event there is both unity of title and use in Parcel 11 and the West Remainder.

The State argues that the beneficiaries of an Illinois land trust owning only personal property are not necessary parties to condemnation proceedings and therefore had no right to file a cross-petition for alleged damages to the North Remainder (Parcel 7). The State further argues that the order of the trial court was proper for the additional reason that there has been no showing of either unity of use or unity of ownership between the part taken and the remainders.

It has long been held that a beneficiary of a land trust is not a necessary party to condemnation proceedings against land held in title by a trustee. See C.N. S. & M.R.R. Co. v. Title & Tr. Co., 328 Ill. 610, 613, 160 N.E. 226 (1928). See also Chicago Land Clear. Com. v. Darrow, 12 Ill.2d 365, 371, 146 N.E.2d 1 (1957). And see Ill. Rev.Stat.1975, ch. 29, par. 8.31.

We do not agree, however, with the initial claim of the State that only a necessary party to the condemnation suit can cross-petition for alleged damages to property not taken.

Section 11 of the Eminent Domain Act (Ill.Rev.Stat.1973, ch. 47, par. 11) provides as material:

'Any person not made a party may become such by filing his cross petition, setting forth that he is the owner or has an interest in property, and which will be taken or damaged by the proposed work; * * *'

Under this section and Section 2 of the Act (Ill.Rev.Stat.1973, ch. 47, par. 2) the holder of an unrecorded interest in the property who is not a necessary party defendant to the condemnation proceedings may be entitled, nevertheless, to file a cross-petition. (Illinois Power Co. v. Miller, 11 Ill.App.2d 296, 305--9, 137 N.E.2d 78 (1956).) In addition, a cross-petition is an appropriate method for a named defendant to seek compensation for other property taken or damaged by virtue of the condemnation and not described in the original petition. Johnson v. F. & M.R. Ry. Co., 111 Ill. 413, 416--17 (1884).

However, an abutting owner, no part of whose land is taken, cannot file a cross-petition in the eminent domain proceedings. (County of Mercer v. Wolff, 237 Ill. 74, 76--77, 86 N.E. 708 (1908). See also City of Chicago v. A. J. Schorsch Realty Co., 127 Ill.App.2d 51, 70, 261 N.E.2d 711 (1970).) The right to recover damages for injury to property from the construction of public works may be asserted by an adjoining owner as a plaintiff in an action at law where none of his property is actually taken (or as a defendant in an eminent domain proceedings for the condemnation of property actually taken). See Illinois Power & Light Corp. v. Talbott, 321 Ill. 538, 545, 152 N.E. 486 (1926). See also Geohegan v. Union El. R.R. Co., 266 Ill. 482, 107 N.E. 786 (1915).

As noted in Johnson v. F. & M.R. Ry. Co., 111 Ill. 413, 416 (1884): 'Where some property is damaged and other property is taken for public use at the same time, in many instances it would seem to be almost indispensable to the ends of justice that the questions should be considered together * * *.' And as a general rule, the question of whether two pieces of land constitute one parcel within the principle permitting damages to be awarded for injury to remaining land is one of law for the court based on the interpretation of statutory and constitutional provisions (See Annot. 6 A.L.R.2d 1197, 1207).

Here, in order to determine whether there is sufficient unity of ownership or interest between the parcels taken and the remaining land, we face the question whether a person who holds the beneficial interest under an Illinois land trust in the property to be taken, as well as in the adjoining property alleged to be damaged, 'is the owner or has an interest in property which will be taken or damaged' which may be asserted by the filing of a cross-petition for severance damages. So far as we are aware, this question has never been directly decided.

There is authority which holds that owning a full fee simple in both the part to be taken and the part remaining is not a prerequisite so that in a proper case, severance damages may be awarded even where the owner of the part condemned has a right or interest less than full ownership in the remaining part. See C. & E.R.R. Co. v. Dresel, 110 Ill. 89, 92 (1884); I., I. & I.R.R. Co. v. Conness, 184 Ill. 178, 182, 56 N.E. 402 (1900). See also Annot. 95 A.L.R.2d 887, sec. 4.

The phrase 'interest in property' as used in section 11 does not clearly require that there be legal or equitable interest in the real property being condemned. Undeniably the beneficiary of an Illinois land trust has a form of property interest. The beneficial interest, however, is not a direct interest in the real estate Res of the trust.

The Illinois courts have guarded the incidents of land ownership represented by the land trust, construing the form of ownership as an active trust with legal and equitable title exclusively in the trustee. (See Chi. Fed. Sav. & Loan Assn. v. Cacciatore, 25 Ill.2d 535, 543, 185 N.E.2d 670 (1962).) In Cacciatore, it was noted that a federal tax judgment against the beneficiary of a land trust was not a lien against the real estate. The court reasoned that the principal purpose of the land trust device was to insure that purchasers of the real estate and lenders who rely on the sole security of the land trustee's title would be able to invest without fear of unknown encumbrances (25 Ill.2d 535, supra, at 547, 185 N.E.2d 670).

A number of other cases have similarly guarded the incidents of land trust ownership. The beneficiary has not been allowed to accept the benefits of the land trust form and still contract to sell or otherwise deal with the real property as if he had legal or equitable title in himself. (See, e.g., ...