2019 IL App (2d) 180681
Ill. App. Ct.2019Background
- In 2008 plaintiffs (Gene and Donna Mosier) obtained a Village of Holiday Hills building permit and constructed a metal pole barn after a Village inspector (Ray DeBosz) told them to include a “truss load.”
- In 2013 McHenry County sued the Mosiers for building in a regulated flood-prone area without a county stormwater/stormwater-management permit; the County sought fines and the Mosiers incurred defense costs.
- In 2016 the Mosiers sued the Village for (1) breach of an oral contract (alleging the inspector’s promise and issuance of the permit) and (2) violation of the Illinois Consumer Fraud and Deceptive Business Practices Act (alleging misrepresentation by the inspector).
- The Village moved to dismiss under 735 ILCS 5/2-619, asserting (inter alia) lack of municipal contractual authority/consideration, that issuing a permit is a regulatory act (not trade or commerce), and that the Act claim was time-barred.
- The trial court dismissed both counts with prejudice; the appellate court affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether issuance of a municipal building permit created an enforceable contract | Permit issuance and inspector’s promise (add truss load) constituted offer/acceptance and fee was consideration | Permit is a regulatory license; inspector lacked authority to bind Village; fee was payment of a legal requirement, not consideration | A municipal building permit is a regulatory license, not a contract; no consideration — breach claim dismissed |
| Whether inspector had apparent/actual authority to bind the Village | Mosier relied on DeBosz’s representations; DeBosz arguably had apparent authority | Only corporate authorities (board/president) bind the municipality | Agency/authority analysis inapplicable; permitting derives from police power and cannot create contractual obligations; authority debate does not save contract claim |
| Whether Village’s conduct fell within the Consumer Fraud Act (trade or commerce) | Issuing permits is a service affecting the public and thus involves trade or commerce | Issuing permits is a governmental/regulatory act, not advertising/offering for sale or distribution of services | Act inapplicable: issuing regulatory building permits is not "trade or commerce" under the Act |
| Whether Act claim was time-barred | Plaintiffs contended they did not discover injury until Sept. 2015, making suit timely | County suit in March 2013 started plaintiffs’ damages and knowledge — three-year limitations expired before suit | Discovery rule applied; plaintiffs knew of injury when County sued in 2013; Act claim barred by the 3-year limitations period |
Key Cases Cited
- Steinberg v. Chicago Medical School, 69 Ill. 2d 320 (Sup. Ct. Ill.) (catalog/criteria created contractual expectations between private parties)
- Village of Schaumburg v. Kingsport Village, Inc., 106 Ill. App. 3d 1055 (Ill. App.) (building permits are akin to licenses; contract principles inapt)
- Treviño & Gonzalez Co. v. R.F. Muller Co., 949 S.W.2d 39 (Tex. Ct. App.) (building permits are revocable licenses; issuance lacks contract elements)
- Chirikos v. Yellow Cab Co., 87 Ill. App. 3d 569 (Ill. App.) (municipal regulatory/legislative functions are not conduct in "trade or commerce" under the Act)
- Robinson v. Toyota Motor Credit Corp., 201 Ill. 2d 403 (Ill. 2002) (elements and scope of Consumer Fraud Act)