2021 IL App (2d) 200047
Ill. App. Ct.2021Background
- Plaintiffs (Souza, Posadzy, Atcherson Association) filed a putative class action alleging the City of West Chicago billed customers for water usage older than the Municipal Code’s statutory billing limits (65 ILCS 5/11-150-2: 12 months residential, 24 months nonresidential) after a 2011 smart-meter rollout produced longstanding meter/reading errors.
- Plaintiffs sued the City for declaratory/injunctive relief and damages; they sued Water Resources, Inc. (the meter vendor) for breach of contract as an alleged third-party beneficiary.
- While the City’s response deadline was pending, the City adopted Ordinance No. 19-O-0010 (Apr. 15, 2019) amending §18-37 of the City Code to (a) authorize billing without a time limitation for delayed reads, (b) state the ordinance controls over §11-150-2, and (c) apply retroactively to billed/unbilled charges and pending claims.
- Water Resources moved under section 2-619 to dismiss the third-party beneficiary claims; the trial court granted that motion. The City moved under section 2-615(e) for judgment on the pleadings, arguing its home rule ordinance governed; the trial court granted judgment for the City.
- Plaintiffs’ postjudgment motion challenging retroactive application was struck but considered and denied on the merits; plaintiffs appealed and the appellate court affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the City’s amended §18-37 is preempted by 65 ILCS 5/11-150-2 (home rule preemption) | §11-150-2 imposes mandatory billing limits on "any municipality," including home rule units, to protect consumers; City ordinance cannot nullify that state mandate | City is a home rule unit; ordinance is a valid exercise of home rule power addressing local billing problems; §11-150-2 contains no express limitation on home rule | Ordinance is a valid home rule exercise; no express statutory preclusion of home rule authority; judgment for City affirmed |
| Retroactive application of the amended ordinance | Retroactive reach abrogates vested abatement rights created by §11-150-2 and is unconstitutional as to bills issued between Aug 18, 2017 and Apr 15, 2019 | Ordinance clearly states temporal reach; no vested right to free water or to an abatement; retroactivity governed by legislative intent and permissible here | Retroactive application upheld; legislative intent controls retroactivity and no constitutionally protected vested right was shown |
| Whether plaintiffs are third-party beneficiaries of the City–Water Resources contract | Contract duties (installation, access, maintenance, customer-facing functionality) show intent to confer direct benefits to customers; plaintiffs have standing to sue Water Resources | Any benefit to customers is incidental; contract was for City’s infrastructure and does not expressly confer direct third-party beneficiary rights | Dismissal of claims vs Water Resources affirmed; plaintiffs were incidental beneficiaries only |
| Jurisdiction/timeliness and forfeiture of appellate issues | Plaintiffs’ postjudgment motion tolled appeal time and preserved issues; appeal timely | City: notice of appeal untimely; postjudgment motion improper and raised new arguments, so issues forfeited | Appellate court found jurisdiction proper; postjudgment motion challenged the judgment and tolled appeal; forfeiture not a basis to dismiss |
Key Cases Cited
- Palm v. 2800 Lake Shore Drive Condominium Ass'n, 2013 IL 110505 (supreme court framework for liberal construction of home rule powers and limits on judicially imposing preemption absent express legislative language)
- Schillerstrom Homes, Inc. v. City of Naperville, 198 Ill. 2d 281 (integration of the Statute on Statutes into home rule analysis)
- City of Chicago v. Roman, 184 Ill. 2d 504 (home rule units may adopt differing local measures absent explicit legislative circumscription)
- City of Chicago v. StubHub, Inc., 2011 IL 111127 (test whether subject pertains to local government and affairs for home rule analysis)
- Perry v. Department of Financial & Professional Regulation, 2018 IL 122349 (legislative intent controls retroactivity; vesting is the constitutional constraint)
- People ex rel. Resnik v. Curtis & Davis, Architects & Planners, Inc., 78 Ill. 2d 381 (third-party beneficiary test: only direct beneficiaries may sue)
- Gillen v. State Farm Mut. Auto. Ins. Co., 215 Ill. 2d 381 (standard of review for judgment on the pleadings)
- Moorman Mfg. Co. v. National Tank Co., 91 Ill. 2d 69 (economic-loss doctrine cited in briefing)