O'Fallon Development Co. v. City of O'Fallon

• Decision Date: 03 November 1976
• Docket Number: No. 75--531,75--531
• Citation: 356 N.E.2d 1293,2 Ill.Dec. 6,43 Ill.App.3d 348
• Court: United States Appellate Court of Illinois
• Parties: , 2 Ill.Dec. 6 O'FALLON DEVELOPMENT COMPANY, INC., an Illinois Corporation, Plaintiff-Appellant, v. CITY OF O'FALLON, a Municipal Corporation, and St. Clair Square, Inc., a corporation, Defendants-Appellees.

Page 1293

356 N.E.2d 1293

43 Ill.App.3d 348, 2 Ill.Dec. 6

O'FALLON DEVELOPMENT COMPANY, INC., an Illinois Corporation Plaintiff-Appellant, v. CITY OF O'FALLON, a Municipal Corporation, and St. Clair Square, Inc., a corporation, Defendants-Appellees.

No. 75--531.

Appellate Court of Illinois, Fifth District.

Nov. 3, 1976.

Fleming & Fleming, Ltd., O'Fallon, for plaintiff-appellant.

Gundlach, Lee, Eggmann, Boyle & Roessler, Belleville, for defendant-appellee St. Clair Square, Inc.

Delmar O. Koebel, Lebanon, for defendant-appellee City of O'Fallon.

KARNS, Presiding Justice:

Plaintiff-appellant, O'Fallon Development Company, Inc., appeals from an order of the Circuit Court of St. Clair County dismissing its complaint against the City of O'Fallon and St. Clair Square, Inc., defendants-appellees.

The complaint alleged that the City of O'Fallon has contractual arrangements with the City of Fairview Heights, its neighbor, whereby it provides water to the residents and businesses located within the municipal boundaries of Fairview Heights, which does not maintain a water department or furnish like services.

St. Clair Square, Inc. owns a shopping center located within the corporate boundaries of Fairview Heights. When the shopping center was constructed, water lines were installed and a water tower was erected adjacent to the shopping center on the property of the shopping center. The water tower and the real estate on which it is situated, were subsequently acquired by the City of O'Fallon which owns in fee the real estate and the water tower, located thereon, and holds the same as municipal property. (Ill.Rev.Stat.1975, ch. 24, pars. 2--2--12, 11--125--2, 11--126--3; People ex rel. City of Salem v. McMackin, 53 Ill.2d 347, 291 N.E.2d 807 (1972)).

At the time the water tower was acquired by the City of O'Fallon the words 'St. Clair Square' and a commercial emblem with which the shopping center is identified were painted on the sides of the water tower. These writings and markings have remained on the tower subsequent to its acquisition by the City of O'Fallon, although no compensation has been paid to the city by St. Clair Square, nor has any other business entity been given an opportunity to advertise in a similar fashion.

The complaint further alleged that the plaintiff, O'Fallon Development Company, Inc., is the owner of the Southview Shopping Center located within the City of O'Fallon and that the two shopping centers, located in close proximity, are competitors and compete for the same customers; that the words and lettering on the water tower are highly visible to potential customers of both shopping centers; and that plaintiff has lost customers and potential patrons resulting in loss of business necessitating the closing of several stores in its shopping center because of the advertising by defendant, St. Clair Square, which plaintiff concludes is unlawfully placed upon the public property of the City of O'Fallon and which the latter improperly allows to remain upon its property. Plaintiff seeks both an injunction requiring the City of O'Fallon to remove these writings and emblems and damages.

Plaintiff contends that its complaint states a cause of action based on section 11--80--8 of the Illinois Municipal Code (Ill.Rev.Stat.1975, ch. 24, par. 11--80--8), on section 13 of Article IV of the Illinois Constitution of 1970, and on section 1(a) of Article VIII of the Illinois Constitution of 1970. The City of O'Fallon contends that section 11--80--8 of the Illinois Municipal Code is not applicable and that the City of O'Fallon in the use and operation of its water works facilities acts in a proprietary as distinguished from a governmental capacity and may engage in activities upon the same basis as a private corporation. St. Clair Square, Inc., while adopting the City of O'Fallon's arguments supporting the judgment of the trial court, contends that the complaint seeks no relief against it, as it is not the owner of the water tower and has no power to control its use, and that the judgment in its favor must be affirmed.

The motion to dismiss admits the truth of all allegations of fact well pleaded, and the cause of action should not be dismissed on the pleadings 'unless it appears that no set of facts can be proved which will entitle the pleader to relief.' Dinn Oil Co. v. Hanover Insurance Co., 87 Ill.App.2d 206, 211, 230 N.E.2d 702, 75 (5th Dist. 1967).

The initial complaint filed by plaintiff was dismissed on motion of the City of O'Fallon and plaintiff was given leave to file an amended complaint which was subsequently dismissed on October 28, 1975, on motion of both defendants. The order of the trial court merely recited that the motion to dismiss the amended complaint was allowed and that all counts thereof were dismissed. Notice of appeal was filed on December 1, 1975, and we thereafter entered a rule on appellant to show cause why the appeal should not be dismissed for lack of a final appealable order. Appellant responded by filing in this court an amended order of the trial court which not only dismissed plaintiff's amended complaint but dismissed its cause of action.

We need not decide whether the amended dismissal order filed after filing notice of appeal should be considered as curing any defect in the original order, Nunc pro tunc, or whether the trial court had jurisdiction to enter an amended order subsequent to filing notice of appeal, as we find the order of dismissal entered October 28, 1975 to be a final appealable order.

Generally, an order dismissing a complaint is not a final, appealable order unless the cause of action is also dismissed with no right to the plaintiff to plead over by filing an amended complaint. Doner v. Phoenix Stock Land Bank, 381 Ill. 106, 109, 45 N.E.2d 20, 22 (1942).

We believe, however, that the better view is to look to the substance of what was actually decided by the dismissal order, rather than the form of the order, and if the effect is to decide that the basic allegations of the pleader, however stated, are insufficient as a matter of law to state a cause of action, then an order dismissing the pleading is a final, appealable order terminating the litigation between the parties. Peach v. Peach, 73 Ill.App.2d 72, 218 N.E.2d 504 (2d Dist. 1966); Pratt v. Baker, 79 Ill.App.2d 479, 223 N.E.2d 865 (2d Dist. 1967); Martin v. Masini, 90 Ill.App.2d 348, 232 N.E.2d 770 (2d Dist. 1967). Here the motion to dismiss the amended complaint was not based on any defect in the allegations of fact pleaded or any technical deficiency in the pleading that could be cured by amendment; rather, it challenged its right to recover as a matter of law. (Lakatos v. Prudence Mutual Casualty, Co., 113 Ill.App.2d 310, 252 N.E.2d 123 (1st Dist. 1969).) We hold that the substance of the order of December 1, 1975, resulted in a termination of the litigation between the parties and was a final, appealable order.

While the distinction is not important to a decision in this case, we would note that the City of O'Fallon is not a home rule municipality. Home rule cities are granted certain powers by the Illinois Constitution of 1970. Section 6(a) of article VII of the Constitution grants to home rule municipalities authority to exercise powers and perform any function pertaining to its government and affairs. Municipalities which are not home rule units continue to derive governmental powers from express legislative grants from the General Assembly or Constitution. (Appeal Board of Department of Environmental Control of City of Chicago v. United States Steel Corporation, 48 Ill.2d 575, 272 N.E.2d 46 (1971); compare Constitutional Commentaries, article VII, sections 6(a) and 7 S.H.A.) It has not been suggested that express statutory authority to allow private advertising on municipal property exists in any form. We are not suggesting we would reach a different result of O'Fallon were a home rule unit. For one reason, the power of such municipalities to own, regulate and exercise sovereign power over land outside their corporate limits must be expressly granted by the legislature. (City of Carbondale v. Van Natta, 61 Ill.2d 483, 338 N.E.2d 19 (1975); and see People ex rel. City of Salem v. McMackin, 53 Ill.2d 347, 291 N.E.2d 807 (1972) (Mr. Justice Schaefer dissenting)). We are simply emphasizing that 'Dillon's rule'--that local governments have only those powers specifically granted by constitution or statute or necessarily arising by implication from the power expressly granted (1 Dillon, Municipal Corporations 448 (5th ed. 1911))--continues to apply to nonhome rule units of local government.

The power of a municipal corporation to acquire land arises from section 2--2--12 of the Municipal Code (Ill.Rev.Stat.1975, ch. 24, par. 2--2--12), but this power is limited to acquisitions pursuant to a legitimate corporate purpose. A municipal corporation may also acquire real estate Outside its corporate limits for such a legitimate purpose. (People ex rel. City of Salem v. McMackin, supra.) Plaintiff does not contend the City of O'Fallon exceeded its power in acquiring the real estate or entering into the contract to supply water to the adjoining municipality as authorized by the Illinois Municipal Code (Ill.Rev.Stat.1975, ch. 24, par. 11--124--1, Et seq.) Rather, plaintiff contends the City of O'Fallon is without power to subject property owned by the municipality to a purely private use by St. Clair Square, Inc.

Defendant City of O'Fallon contends its ownership of the water tower is a proprietary function and, as such, it has the power to allow advertising on the same basis as a private corporation, if indeed the writings and markings constitute advertising. It is true, as defendants note, that a municipal corporation selling water for private consumption does so in its proprietary rather than its governmental capacity. (City of West Frankfort v. United Ass'n of Journeymen, ...