Maywood Proviso State Bank v. City of Oakbrook Terrace, Gen. No. 65-48

• Decision Date: 01 February 1966
• Docket Number: Gen. No. 65-48
• Citation: 214 N.E.2d 582,67 Ill.App.2d 280
• Parties: MAYWOOD PROVISO STATE BANK, a national banking association, as Trustee under Trust #1646, The Flame, Inc., an Illinois Corporation, Peter G. Makris and Gloria Makris, his wife, Appellants, v. The CITY OF OAKBROOK TERRACE, a municipal corporation, Walter C. Padgett, James P. McDonnell, George Dobson, Darwin Rudd, Richard Sarallo, Ernest Wright, George Paiech, and William Wurster, Appellees.
• Court: United States Appellate Court of Illinois

Page 582

214 N.E.2d 582

67 Ill.App.2d 280

MAYWOOD PROVISO STATE BANK, a national banking association as Trustee under Trust #1646, The Flame, Inc., an Illinois Corporation, Peter G. Makris and Gloria Makris, his wife, Appellants, v. The CITY OF OAKBROOK TERRACE, a municipal corporation Walter C. Padgett, James P. McDonnell, George Dobson, Darwin Rudd, Richard Sarallo Ernest Wright, George Paiech and William Wurster, Appellees.

Gen. No. 65-48.

Appellate Court of Illinois, Second District.

Feb. 1, 1966.

Rehearing Denied March 11, 1966.

John C. Polales, Daniel H. Pappas, Chicago, for appellants.

Hubert J. Loftus, Addison, for appellees.

DAVIS, Justice.

Plaintiffs, Maywood-Proviso State Bank, as Trustee; The Flame, Inc.; and Peter G. Makris and Gloria Makris, as beneficiaries under the aforementioned trust, brought this suit against the defendants, The City of Oakbrook Terrace and certain city officials, to enjoin the enforcement of a general liquor control ordinance in its application to the property held in said trust with reference to closing hours in connection with the sale of alcoholic beverages. The plaintiffs appealed from a decree rendered in favor of the defendants.

The plaintiffs content that by virtue of a pre-annexation agreement entered into in December of 1962 between their predecessors in title to the real estate in question and the defendant municipality, it was agreed, among other things, that any liquor license granted to the owners of the real estate in question would permit the serving of alcoholic beverages up to 3:00 A.M. on Monday through Friday and up to 4:00 A.M. on Saturday, Sunday and holidays; and that by virtue of this agreement, a subsequent general liquor ordinance, adopted by the city in October of 1964, which prohibited the sale of alcoholic beverages after 1:00 A.M. on Monday through Friday and after 2:00 A.M. on Saturday, Sunday and legal holidays, could not be applied to the real estate in question. Defendants urge that the provisions of the agreement relative to the liquor license are contrary to the Liquor Control Act and therefore are void and unenforceable.

The pre-annexation agreement entered into between the city and plaintiffs' predecessors in December of 1962 provided that the owners of the land in question would cause it to be annexed to the city, and the city would cause certain ordinances, relative thereto, to be enacted. The city agreed it would 'cause the property to be given a zoning classification as a special use permit' and would abopt such other ordinances as would be necessary to permit the following uses on the property:

'1. b) 1. The serving of alcoholic beverages for consumption on the premises.

2. The granting of a liquor license for purposes of allowing allowing alcoholic beverages to be served on said premises which said license shall permit the serving of alcoholic beverages up to 3 A.M. on Monday, Tuesday, Wednesday, and Thursday and Friday and up to 4 A.M. on Saturday and Sunday and legal Holidays. * * *

4. It is expressly understood that any changes in the requirements of any relevant ordinances which may affect the premises shall conform to the spirit and intent of this agreement and that this agreement is made as an inducement to 'Ellison' to annex, develop and operate said property and the establishment thereon in the manner above described and 'Ellison' is entitled to further change his position in reliance upon this agreement.'

The agreement further provided:

'2. 6. Upon execution of this agreement by the parties hereto, the City agrees to enact such resolutions or ordinances as may be necessary to permit the City to comply with the terms of this agreement.'

The city adopted a contract ordinance authorizing the execution of the agreement on behalf of the city and thereafter adopted an ordinance annexing the property in question.

In 1963, the legislature added to the Municipal Code, division 15.1 relating to annexation agreements (Ill.Rev.Stat.1965, Chap. 24, pars. 11-15.1-1 through 11-15.1-5). Section 11-15.1-1 provides:

'The corporate authorities of any municipality may enter into an agreement with one or more of the owners of record of land in any territory which may be annexed to such municipality as provided in Article 7 such agreement to be valid and binding for a period of not to exceed 5 years from the date of execution thereof.'

As to the scope of such agreements, Section 11-15.1-2 provides:

'Any such agreement may provide for the following as it relates to the land which is the subject of the agreement:

* * *

* * *

'(f) any other matter not inconsistent with the provisions of this Code, nor forbidden by law.

'Any action taken by the corporate authorities during the period such agreement is in effect, which, if it applied to the land which is the subject of the agreement, would be a breach of such agreement, shall not apply to such land without an amendment of such agreement.'

Section 11-15.1-4 provides that such an agreement is binding upon successor owners of the land and successor municipalities and may be enforced by appropriate legal proceedings. Section 11-15.1-5 provides that any agreement entered into prior to the effective date of the Amendatory Act of 1963 which was executed pursuant to a twothirds vote of the corporate authorities and which contains provisions not inconsistent with Section 11-15.1-2 is valid and enforceable for the effective period of the agreement or for five years from the date of execution, whichever is shorter.

The parties concede that the agreement in question was executed in the manner set forth in Section 11-15.1-5 and is, therefore, valid and enforceable for a period of five years from December 1962, if the provisions thereof referred to are not forbidden by law. If the provisions are forbidden by law, then the general liquor control ordinance, which would compel an earlier closing hour on the premises, would be applicable.

The power of a municipality relative to traffic in intoxicating liquors is derived entirely from the State. The control over such traffic is a necessary incident to the police powers of the State--not of the political subdivisions or municipalities thereof. Heidenreich v. Ronske, 26 Ill.2d 360, 365, 187 N.E.2d 261 (1962); Henson v. City of Chicago, 415 Ill. 564, 569, 114 N.E.2d 778 (1953); Sager v. City of Silvis, 402 Ill. 262, 265, 83 N.E.2d 638 (1949). The State may delegate this power to license, regulate or prohibit traffic in intoxicating liquors to a municipality, but the municipality has only that power delegated to it and no other. The Liquor Control Act (Ill.Rev.Stat.1965, Chap. 43, par. 94 et seq.) contains the delegation of this power to municipalities and prescribes the limits beyond which a municipality may not act. Heidenreich v. Ronske, supra; Henson v. City of Chicago, supra. Any ordinance or act of a municipality beyond the legislative authorization of the Liquor Control Act is without legal force or validity.

Article 1, Section 1 of the Act (Ill.Rev.Stat.1965, Chap. 43, par. 94) provides that the Act is to be liberally construed to the end that the health, safety and welfare of the people be protected, and temperance in the consumption of alcoholic liquors be fostered and promoted by sound and careful control and regulation.

Section 1 of Article IV of the Act (Ill.Rev.Stat.1965, Chap. 43, par. 110) contains the delegation by the State to cities and other political subdivisions of 'the power by general ordinance or resolution to determine the number, kind and classification of licenses, for the sale at retail of alcoholic liquor not inconsistent with this Act * * * and to establish such further regulations and restrictions upon the issuance of and operations under local licenses not inconsistent with law as the public good and convenience venience may require; * * *' (italics ours.)

The Act further provides that a license 'shall be purely a personal privilege, good for not to exceed one year after its issuance * * * and shall not constitute property, * * * nor shall it be alienable or transferable, * * *.' (Ill.Rev.Stat.1965, Chap. 43, par. 119.)

The agreement and ordinance authorizing the agreement in this case are manifestly contrary to the provisions of paragraph 119 of the Liquor Control Act. By the agreement, the city purported to bind itself to grant a liquor license for use on these particular premises for the term of the agreement which, under the statute, was five years. Had the parties intended only that the land be given a zoning classification which would have permitted the sale of alcoholic beverages thereon, then subparagraph 1. (b) 1. of the agreement requiring such a zoning classification, was sufficient for this purpose. But the agreement of the parties went further and provided for the adoption of such other ordinances as may be necessary to authorize the use set forth in subparagraph 1. (b) 2., namely: 'The granting of a liquor license for purposes of allowing alcoholic beverages to be served on said premises which said license shall permit the serving of alcoholic beverages up to...