Opinion ID: 359544
Heading Depth: 1
Heading Rank: 1

Heading: the validity of the withholding of permits under the village ordinance

Text: 9 The Village argues that it had the right to withhold permits under its police power to protect the health and welfare of its citizens as embodied in its ordinance governing subdivisions. The position of the Village is simply that it should not be compelled to accept eleven additional homes under the unsafe and undesirable conditions caused by the absence of required public improvements. Under this theory, the Trustee is in no different position than any other owner of lots within the subdivision. 4 To evaluate this claim by the Village, it is necessary to examine in some detail the provisions of the Village ordinance. 5 10 Construction within the Village is governed by several sections of the Village ordinance. Section 2(a) of the ordinance prohibits the subdivision of land, the making of improvements to the land, and the laying of streets until a proposed plan has been approved by action of the Board of Trustees of the Village. Section 2(b) prohibits the sale or offer of sale of any lot, tract or parcel of land within any subdivision until such subdivision plans are officially approved by the Board of Trustees of the Village. Section 2(c) provides that no improvements such as sidewalks or drainage facilities shall be made until the plans for such improvements have been formally recommended by the Plan Commission and approved by the Board of Trustees. 11 Section 6 of the ordinance sets forth items which must accompany the recordation of the final plat of the subdivision. Subparagraph (a) of section 6 requires plans and specifications for public improvements previously approved by the Village engineer. Subparagraph (b) requires an agreement executed by the owner and subdivider to make, install and turn over to the Village the improvements provided for in the ordinance. Subparagraph (c) requires a bond in the amount of the estimate of the Village engineer of the cost of the installation of the improvements with good and sufficient surety thereon, to be approved by the Board of Trustees, conditioned upon installation within two years of approval. 12 Section 7 of the ordinance lists the required land improvements which must be made. The section also provides that final plans of the subdivision must be accompanied by a written statement signed by the Village engineer certifying that the improvements described in the plans and specifications meet the minimum required by the ordinance. 13 The ordinance provides for several remedies in the event required public improvements are not completed. As stated above, subparagraph (c) of section 6 mandates that a developer put up a bond guaranteed by a surety in the amount of the estimate of the cost of all public improvements. In the present case, the Village for some inexplicable reason only required a bond of $20,000. While this bond is currently the subject of litigation in state courts, the amount of the bond is far less than the estimated cost of completing the unfurnished improvements. Subparagraph (b) of section 6 which requires a subdivider to enter into an agreement to build and install the improvements described in section 7 also appears to create a remedy for breach of contract against the developer in the event of nonperformance. 6 Additional protection against nonperformance is provided by section 8 which provides for inspection of public improvements by the Village engineer at the subdivider's expense. Finally, section 16(a) of the ordinance provides that the construction of any public improvement in violation of the provisions of the ordinance shall be fined between $25 and $250 with each day during which a violation occurs or continues constituting a separate offense. 7 Here, however, the Village had attempted to rely on the absence of required public improvements as a justification for the withholding of building and occupancy permits from the Trustee and any prospective purchasers. From the viewpoint of the Village, the Trustee is no more entitled to permits under the ordinance than the owner of any lot where required improvements have not been completed. The question is whether the withholding of permits is permissible under the ordinance. 14 Section 11 of the ordinance states that no occupancy permits shall be issued until required utility facilities have been installed and roadways providing access to the lots in question have been constructed or are in the course of construction. The Trustee has stipulated in its brief and at oral argument, however, that such improvements as sidewalks and driveways will be installed. The Trustee has not conceded that other improvements such as sewer connections or roadway access will be provided by purchasers. Since the Village never specifically cites section 11 as a ground for withholding permits, however, it has waived any claim of lack of utility facilities or road access. 15 Section 10 of the ordinance governs the issuance of building permits. Section 10 provides: 16 No building permit shall be issued by any governing officials for the construction of any building, structure or improvement to the land or any lot within a subdivision as defined herein, which has been approved for platting or replatting, until all requirements of this Ordinance have been fully complied with. 17 Thus in contrast with section 11 which contains fairly specific language regulating the issuance of occupancy permits, section 10 contains broad general language, the interpretation of which is in dispute. 18 The Village contends that since public improvements remain uncompleted, all requirements of the ordinance have not been fully complied with and therefore it need not issue any building permits, to the Trustee or anybody else. The Trustee, on the other hand, argues that the Bankrupt fully complied with the steps set out in sections 6 and 7 of the ordinance which are necessary for recordation of the final plat. Failure to complete public improvements, according to the Trustee, does not constitute failure to comply with the ordinance, but failure to fulfill the agreement, section 6(b), and comply with the conditions of the bond which, under section 6(c), is designed to equal the cost of the required public improvements. Any failure to perform could be cured by recovering from the surety and applying the proceeds to the cost of completing the unfinished improvements. A claim could also be filed in the bankruptcy proceedings. Under the Trustee's interpretation of the ordinance, therefore, all requirements of the ordinance, in contrast with the conditions of the bond, have been fully complied with and the Village has no right to withhold building permits. 19 It is conceivable, as the Village claims, that the phrase requirements of this Ordinance in section 11 includes fulfillment of the section 6(b) agreement. But we agree with the Trustee's interpretation of the ordinance for several reasons. First, the Village construed the phrase in 190 out of 200 instances as not including fulfillment of section 6(b). Second, sale is permitted immediately after recording and it seems unlikely that building and occupancy were intended to be delayed until all improvements were completed. The bond, under section 6(c), permits a two-year delay after approval before improvements need be completed. Third, an occupancy permit is permitted before completion of an access road. In light of these provisions of the ordinance and past practice of the Village, we cannot agree with the Village that there can be no construction or occupancy until all improvements are completed. 20 Since the Village had no authority under the ordinance to withhold permits, we need not consider whether the actions of the Village conflict with any powers granted to the Trustee by the Bankruptcy Act and are therefore invalid under the Supremacy Clause. 21 The judgment appealed from is reversed with directions to reinstate and affirm the order of the Bankruptcy Court.