2018 IL App (4th) 150519-B
Ill. App. Ct.2018Background
- IEPC (Enbridge Energy) obtained ICC authority in 2014 to condemn easements for the Southern Access Extension (SAX) pipeline; Marathon has contractual rights to ~2/3 of capacity.
- IEPC filed condemnation actions against the Kuerth landowners; the trial court initially denied traverse and discovery motions, barred certain testimony, and entered judgment permitting construction and fixing compensation.
- On the first appeal (Kuerth I) this court affirmed in part but remanded for a traverse hearing, holding landowners were entitled to try to rebut presumptions (public use/necessity and Commission good-faith negotiations).
- On remand the trial court (1) denied a discovery request seeking identities/shipper data for SAX, (2) held a traverse hearing and found landowners failed to rebut presumptions by clear and convincing evidence, and (3) denied IEPC’s Rule 137 motion for sanctions.
- This appeal challenges (a) the traverse ruling and the discovery denial; IEPC cross-appeals the denial of sanctions and seeks Rule 375(b) sanctions against landowners’ counsel.
- The appellate court affirmed: (1) no manifest-weight error in finding landowners failed to rebut presumptions; (2) discovery denial was proper given traverse scope; (3) trial court did not abuse discretion denying sanctions; Rule 375(b) sanctions denied.
Issues
| Issue | Plaintiff's Argument (IEPC) | Defendant's Argument (Kuerth) | Held |
|---|---|---|---|
| Whether landowners rebutted presumptions of public use and necessity | Presumptions should stand; public benefit shown by ICC certificate | Pipeline is private because Marathon controls majority capacity, so public is not "primarily" beneficiary | Affirmed: landowners failed to rebut; "primarily" means chiefly/principally, not a percentage test; ownership/shipper identity not dispositive |
| Whether Marathon's involvement/shipper data is relevant | Not relevant to public-benefit presumption | Relevant — who uses pipeline and capacity shares show private project | Affirmed: extent of private use not required; legislature contemplates private operators serving public ends |
| Whether trial court erred in denying discovery (shipper identities/volumes/terms) | Discovery unnecessary for traverse scope | Discovery needed to show private control and rebut presumptions | Affirmed: discovery request irrelevant and overbroad for limited traverse hearing |
| Whether sanctions (Rule 137 and Rule 375(b)) against landowners' counsel were warranted | Counsel pursued frivolous/repetitive arguments; request denial was error; request appellate sanctions | Counsel followed remand instructions and made colorable arguments in unsettled area | Affirmed: trial court did not abuse discretion denying Rule 137; Rule 375(b) sanctions denied — appeal not frivolous given unsettled law |
Key Cases Cited
- Lakehead Pipeline Co. v. Illinois Commerce Comm’n, 296 Ill. App. 3d 942 (1998) (identifies types of evidence a landowner may use to rebut public-benefit presumption)
- Southwestern Ill. Dev. Authority v. National City Environmental, L.L.C., 199 Ill. 2d 225 (2002) (no bright-line test; courts look to motive and legitimacy of public-use decision)
- City of Chicago v. Midland Smelting Co., 385 Ill. App. 3d 945 (2008) (property owner may challenge presumptions at traverse; standards for review)
- People ex rel. City of Urbana v. Paley, 68 Ill. 2d 62 (1977) (incidental private benefits do not defeat public-use requirement)
- People v. Hill, 409 Ill. App. 3d 451 (2011) (statutory construction principles; undefined words given ordinary meaning)