Opinion ID: 1930678
Heading Depth: 2
Heading Rank: 4

Heading: Voluntariness of Consents

Text: Finally, the district court held the property owners' consents were not voluntary because Dubuque unfairly induced the property owners to the extent that it placed the property owners in a position of either agreeing to the annexation and receiving financial benefits, or being denied financial benefits for refusing to agree to the annexation. . . . The court relied on Hoepker v. City of Madison Plan Comm., 209 Wis.2d 633, 563 N.W.2d 145 (1997), a Wisconsin case, for this proposition. See Hoepker, 563 N.W.2d at 150 (Municipalities cannot coerce or unfairly induce an elector and/or property owner into agreeing to annexation.). Besides the differences in Wisconsin's and Iowa's annexation laws, there is one most obvious distinction between Hoepker and this case. In Hoepker, the property owners themselves alleged they had been coerced by the City of Madison into annexing their land. In the present case, the property owners are not seeking relief. Instead, Asbury, a competing city, is challenging Dubuque's annexation and relies on statements the property owners made to the CDB. This is not how one raises coercion or duress in Iowa. But see Town of Fond du Lac v. City of Fond du Lac, 22 Wis.2d 533, 126 N.W.2d 201 (1964) (one municipality successfully arguing another municipality coerced residents into consenting to annexation). The Agreement at issue is a contract. Dubuque offered several incentives to the property owners in the proposed territory in return for their consent to annexation. Based on the CDB's record, some property owners only grudgingly consented to annexation. Nevertheless, Dubuque rightly points out that none of the property owners rescinded their consent. Section 368.7(1)( f ) allows a property owner to withdraw his consent within three business days after the public hearing unless the property owner has entered into a written agreement for extension of city services or unless the right to withdraw consent was specifically identified and waived by the landowner. The Agreement states [e]ach Property Owner agrees not to withdraw the application or any part thereof after its filing with the City Council. We need not decide whether the Agreement effectively waived the property owners' right to withdraw their consents under section 368.7(1)( f ) because none of the property owners attempted to withdraw their consents within the nearly seven month time frame between executing the Agreement and the public hearing. Essentially, Asbury is arguing the Agreement is voidable by reason of economic duress. In Iowa, a party claiming economic duress must prove the following elements: (1) a party involuntarily accepted the terms made by another party, (2) circumstances permitted no other alternative, and (3) such circumstances were the result of coercive acts of the other party. Fees v. Mut. Fire & Auto. Ins., 490 N.W.2d 55, 59 (Iowa 1992) (citing Turner v. Low Rent Hous. Agency, 387 N.W.2d 596, 598-99 (Iowa 1986)). Assuming arguendo duress can be proven, Asbury is not in position to make that argument. We follow the Restatement's rule concerning the effect of duress on the enforceability of a contract: If a party's manifestation of assent is induced by an improper threat by the other party that leaves the victim no reasonable alternative, the contract is voidable by the victim.  Turner, 387 N.W.2d at 598 (Iowa 1986) (quoting Restatement (Second) of Contracts § 175(1), at 475 (1981)) (emphasis added). Asbury cannot be the victim because it is not a party to the Agreement. The property owners who are parties to the Agreement have neither joined this lawsuit nor withdrawn their consents. As it stands, Asbury may not allege coercion on behalf of the property owners. Consequently, it was error to conclude Dubuque coerced the property owners into consenting to annexation.