2018 IL App (2d) 170835
Ill. App. Ct.2018Background
- In 2003 plaintiffs (sellers) sold parcels totaling 531.8 acres to the Forest Preserve District of Kane County; deeds included restrictive covenants required by an Illinois DNR OSLAD grant (limits use to public outdoor recreation; sale/encumbrance only with DNR approval).
- Deeds were rerecorded in 2004–2005 to correct description and add specific DNR covenant language; in 2005 the District sought and later obtained DNR approval to reduce the grant project area from 531.8 acres to 200 acres (excluding plaintiffs’ parcels).
- In 2013–2014 ComEd proposed a transmission line; title concerns arose because of the restrictive covenants. On June 30, 2014, the District’s attorney manually removed the covenant language and rerecorded the deeds.
- Plaintiffs refused to execute releases when requested; the ICC later declined the District’s preferred route in part because parcels “may be subject to deed restrictions.” Plaintiffs demanded the deeds be restored; the District refused.
- Plaintiffs sued (mandamus, declaratory judgment, breach of contract, interference, breach of fiduciary duty, malpractice) seeking restoration of the restrictive covenant and fees. Defendants moved to dismiss under section 2-619 for lack of standing; trial court dismissed. Plaintiffs appealed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether plaintiffs have standing to enforce the restrictive covenant | Plaintiffs argue the sale was made subject to permanent use restrictions, so they retained a continuing property interest and third‑party rights to enforce the covenant | Defendants argue plaintiffs relinquished property rights on sale and the covenant primarily benefitted DNR (it allowed DNR to remove restrictions), so plaintiffs lack a legally cognizable interest | Court held plaintiffs lacked standing because the deed language vested removal/approval with DNR and the covenant served the DNR/grant, not the prior owners |
| Whether deed language created an enforceable, continuing right in sellers | Plaintiffs: conveyance subject to restrictions gives grantor continuing interest or third‑party beneficiary rights | Defendants: deed and sales agreement show restrictions existed to secure DNR grant conditions and allowed DNR removal, so no reserved enforceable right to sellers | Court held deed/sales agreements show no reservation of a continuing right by sellers; removal by DNR made covenant terminable |
| Whether unilateral alteration (attorney striking covenant) was effective | Plaintiffs: covenant could not be altered without sellers’ consent; unilateral act ineffective | Defendants: District (and DNR approval) could remove covenant per deed terms | Court did not reach merits because of standing ruling (lack of standing dispositive) |
| Whether plaintiffs were third‑party beneficiaries of DNR–District agreement | Plaintiffs: analogous to third‑party beneficiary cases (Streams) and thus have standing | Defendants: plaintiffs are not successors to DNR’s interest and are not intended beneficiaries | Court held Streams distinguishable; plaintiffs are not successors or intended beneficiaries and thus lack standing |
Key Cases Cited
- Van Meter v. Darien Park District, 207 Ill. 2d 359 (2003) (purpose and use of section 2‑619 to dispose of legal issues early)
- Glisson v. City of Marion, 188 Ill. 2d 211 (1999) (lack of standing is affirmative matter under section 2‑619)
- Greer v. Illinois Housing Development Authority, 122 Ill. 2d 462 (1988) (standing requires distinct, traceable, redressable injury; declaratory relief requires an actual controversy)
- Foxfield Realty, Inc. v. Kubala, 287 Ill. App. 3d 519 (1997) (general rule that a seller relinquishes rights on sale absent a reserved interest)
- VanSant v. Rose, 260 Ill. 401 (1913) (restrictive covenants may create continuing interests in grantors when properly reserved)
- Streams Sport Club, Ltd. v. Richmond, 109 Ill. App. 3d 689 (1992) (successor/third‑party beneficiary can enforce contract when clearly intended)