Fiala v. Griffin
2021 IL App (2d) 210064-U
| Ill. App. Ct. | 2021Background
- In 1994 Wasco Sanitary District entered an annexation/connection-fee agreement with developer Fox Mill Limited Partnership (FMLP) allowing developers to finance and receive payments/connection permits for water/sewer capacity; that arrangement was amended several times and portions were assigned to B&B Enterprises.
- In 2008 the District entered a Norton Lakes annexation agreement with developer Hudson Harrison; Harrison paid for wastewater capacity (106 lots) purchased from B&B.
- Fiala, a Fox Mill homeowner, has long litigated that the District’s assignments/sales of connection permits violated the public trust and were tainted by trustees’ conflicts; he sought declaratory relief, accounting, and disgorgement.
- The District and Harrison settled in 2014 by consent decree: the District executed the plat and reaffirmed the Norton Lakes Agreement; Harrison made indemnity payment.
- On remand Fiala filed a sixth amended complaint (claims for declaratory relief, accounting, recovery) against B&B defendants and Harrison; the circuit court granted summary judgment to Harrison (holding 2014 settlement cured defects) and dismissed counts against B&B as time-barred, reasoning quo warranto was the exclusive remedy.
- On appeal the court reversed the 2-619 dismissal (quo warranto not exclusive) but affirmed summary judgment for Harrison (2014 reenactment/settlement valid and Fiala collaterally estopped/waived new factual challenges).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether a challenge to annexation/contractual transfers must be brought only by quo warranto (and thus is time-barred) | Fiala: he seeks declaratory relief under public trust statute and Public Officer Prohibited Activities Act, not quo warranto | B&B: earlier opinion required quo warranto; quo warranto has a one-year statute and bars these claims | Court: quo warranto is not Fiala’s exclusive remedy; declaratory actions may challenge discretionary acts; dismissal reversed |
| Whether the 2008 Norton Lakes Agreement was void ab initio due to trustee conflicts and therefore cannot be ratified by later action | Fiala: the 2008 agreement is void and cannot be ratified; 2014 settlement cannot cure a nullity | Harrison: 2014 settlement and ratification by a later board cured the procedural/defect problems; re‑adoption was lawful | Court: affirmed summary judgment for Harrison; a later valid reenactment/ratification can cure previous defects; voidness makes the act unenforceable but does not forever prohibit reenactment |
| Whether Fiala may challenge the 2014 ratification based on alleged undisclosed ties of a trustee | Fiala: minutes and asserted relationships show persistent conflict and create factual dispute | Harrison/B&B: these factual claims were not presented below and are procedurally defaulted; Fiala had notice and earlier opportunities; collateral estoppel applies | Court: challenge waived for failure to present below; collateral estoppel bars relitigation of ratification in these proceedings |
Key Cases Cited
- Van Meter v. Darien Park Dist., 207 Ill. 2d 359 (Ill. 2003) (describing purpose and scope of section 2-619 motions)
- People ex rel. Freeport Fire Protection Dist. v. City of Freeport, 90 Ill. App. 3d 112 (Ill. App. Ct. 1980) (quo warranto inquires into right or authority to act)
- People ex rel. Citizens for a Better Bloomingdale v. Village of Bloomingdale, 37 Ill. App. 3d 583 (Ill. App. Ct. 1976) (quo warranto challenges authority to act; declaratory relief can address manner/discretion)
- Perlstein v. Wolk, 218 Ill. 2d 448 (Ill. 2006) (invalidation of law must be qualified; prior existence may have operative consequences)
- People v. Blair, 2013 IL 114122 (Ill. 2013) (void ab initio means unenforceable, not that the enactment never existed for all practical/legislative purposes)
- Best v. Taylor Machine Works, 179 Ill. 2d 367 (Ill. 1997) (legislature free to reenact provisions struck down previously)
- Sylvester v. Chicago Park District, 179 Ill. 2d 500 (Ill. 1997) (issue waived if not presented or evidentiary foundation not laid in trial court)
- LaSalle Bank Nat’l Ass’n v. Village of Bull Valley, 355 Ill. App. 3d 629 (Ill. App. Ct. 2005) (collateral estoppel can bar relitigation of annexation-related judgments)