Opinion ID: 2527227
Heading Depth: 1
Heading Rank: 5

Heading: Application of Kirby

Text: ¶ 34 Finding no forfeiture, we turn now to the issue of whether the appellate court correctly applied Kirby to order a hearing on remand to determine if the property has materially increased in value, and if so, to hold another jury trial on valuation. In Kirby, the government filed a condemnation complaint on August 21, 1978, to take timber company land for a forest preserve. Trial began before a commission on March 6, 1979, which was also the date of valuation used for assessing just compensation. The commission entered a report recommending compensation of roughly $2.3 million. Both parties filed objections in federal district court, and that court entered judgment on the commission's report. However, a period of three years and three weeks elapsed between the date of the trial (the valuation date) and the date of the taking (the date the government made payment for the land and acquired title). ¶ 35 The United States Supreme Court granted certiorari in the case to determine the date on which a taking occurs and to consider whether there was any obligation of the government to pay interest from the date of trial to the date of deposit. Kirby, 467 U.S. at 9, 104 S.Ct. 2187. The Court began by noting that the fifth amendment does not preclude the government from taking land and paying for it later. But the fifth amendment requires that if disbursement of the award is delayed, the owner is entitled to interest thereon sufficient to ensure that he is placed in as good a position pecuniarily as he would have occupied if the payment had coincided with the appropriation. Kirby, 467 U.S. at 10-11, 104 S.Ct. 2187. Thus, the court found identification of the time of the taking of a tract of land crucial to the amount of compensation to which an owner is constitutionally entitled. Id. at 11, 104 S.Ct. 2187. ¶ 36 Kirby then noted that Danforth v. United States, 308 U.S. 271, 284, 60 S.Ct. 231, 84 L.Ed. 240 (1939), had held that unless a taking has occurred previously in actuality or by a statutory provision, a taking in a condemnation suit takes place upon the payment of the money award by the condemnor. Kirby noted that justification for the rule was based on the understanding that the owner is protected by the rule that title does not pass until compensation has been ascertained and paid. (Internal quotation marks omitted.) Kirby, 467 U.S. at 12, 104 S.Ct. 2187 (quoting Danforth, 308 U.S. at 284-85, 60 S.Ct. 231). Kirby further cited a federal rule that permits the government to dismiss a condemnation suit at any time before `compensation has been determined and paid,' unless the [g]overnment previously has `acquired the title or a lesser interest . . . or taken possession.' Kirby, 467 U.S. at 12, 104 S.Ct. 2187 (quoting Fed.R.Civ.P. 71A(i)). The Court observed that the government's ability to abandon the proceeding in this fashion would be difficult to understand if a taking were effectuated any time prior to tendering payment. See Kirby, 467 U.S. at 12, 104 S.Ct. 2187. Kirby also looked to a federal provision equivalent to our state quick-take procedure (see 735 ILCS 5/7-103 (West 1998)) as support for its holding that a taking could not have occurred prior to payment and the government's acquiring of title and the right to possess the land. The Court observed that the option of peremptorily appropriating land prior to final judgment, thereby permitting immediate occupancy and improvement of the property[,]    would have been superfluous if, as petitioner contends, a taking occurred upon the filing of the complaint in a [straight-condemnation] suit. Kirby, 467 U.S. at 12-13, 104 S.Ct. 2187. Accordingly, Kirby concluded that the taking of the petitioner's land occurred on March 26, 1982, the date the award was paid, and therefore, petitioner was not due any interest. ¶ 37 Kirby further found that its conclusion did not dispose of the case because it still had to determine whether the award itself satisfied the requirements of the fifth amendment. Kirby, 467 U.S. at 16, 104 S.Ct. 2187. The Court agreed with the landowner's argument that, to the extent that the $2.3 million awarded by the jury is less than the value of the land on March, 26, 1982, the date of the taking, it has been denied just compensation. The government had argued in response that a general rule setting a date of valuation in all cases (like the rule setting the time of trial as the date of valuation) was necessary so the trier of fact would know the date on which the value of the land should be assessed. The Court, however, was insistent that the government's argument did not negate the landowner's constitutional claim: The Government's argument provides a plausible explanation for the valuation procedure used in this case and other cases, but it does not meet [the landowner's] constitutional claim. However reasonable it may be to designate the date of trial as the date of valuation, if the result of that approach is to provide the owner substantially less than the fair market value of his property on the date the [government] tenders payment, it violates the Fifth Amendment. Kirby, 467 U.S. at 17, 104 S.Ct. 2187. ¶ 38 Kirby 's solution to the problem was to allow the landowner on remand to present evidence pertaining to change in the market value of the tract during the period between those two dates. Kirby, 467 U.S. at 19, 104 S.Ct. 2187. Finally, the Court opined that because a landowner would be obliged to bear some litigation costs in bringing a claim that there had been a change in value, it would have the healthy effect of dissuading landowners from lightly deciding to undertake such claims. Kirby, 467 U.S. at 19 n. 29, 104 S.Ct. 2187. ¶ 39 In applying Kirby to the present case (or even deciding in the first instance whether it should be applied to Illinois law), it is necessary to know the point in time a taking occurs in Illinois. Because if a taking in Illinois occurs on the date the condemnation action is filed, then the valuation date would correspond with the taking date and there would therefore be no Kirby problem to speak of. ¶ 40 We find that a taking in Illinois for the purposes of applying Kirby occurs on the date that the government (1) deposits the amount of compensation that has been ascertained and awarded, and (2) acquires title and the right to possess the property. The District relies primarily upon Dunlevy, Blue Island, and City of Chicago v. Farwell, 286 Ill. 415, 121 N.E. 795 (1918), to support its argument that a taking occurs upon the mere filing of the condemnation complaint. We find that the District's reliance upon Dunlevy and Blue Island is misplaced, and to the extent that Farwell can be used to support the District's argument, we find that it was wrongly decided and must be overruled. ¶ 41 Dunlevy merely held that the value of land in a condemnation case should be measured as of the date of the filing of the petition to condemn. Dunlevy, 91 Ill. at 53. It did not hold that a taking occurred upon the filing of the petition to condemn. Instead it held just the opposite: The filing of a petition to condemn property is not a taking of the same. If the [government] took possession of defendant's property before the damages were assessed and paid, they were trespassers   .    The defendants had the right to the possession and use of their property after the petition was filed, the same as before, and we perceive no reason why they should have the use of the property, and at the same time be allowed interest upon its value, before it was actually taken. Dunlevy, 91 Ill. at 54. ¶ 42 The more recent decision of this court in Blue Island did not purport to address the question of when a taking occurs. Rather, the court simply repeated the established rule that the value of property to be taken in a condemnation proceeding is determined using the date the petition for condemnation was filed. See Blue Island, 49 Ill.2d at 411, 274 N.E.2d 56. ¶ 43 Thus, neither Dunlevy nor Blue Island supports the District's argument, and Dunlevy actually supports the landowners' argument. That leaves the District to rely upon Farwell. But we do not find that case persuasive here. In particular, the District relies upon the following language from Farwell: The constitution provides that private property shall not be taken or damaged for public use without just compensation, and it is always held that compensation is to be determined as of the time of the taking. There is a diversity of rule in different jurisdictions as to the time when a taking for public use occurs, but in this State that question has passed beyond the stage of discussion and has become a fixed rule, which is, that the compensation is to be determined as of the date of filing the petition and not at the time of the trial. Farwell, 286 Ill. at 417, 121 N.E. 795. Farwell seems to have confused the date of valuation with the date of taking and equated the two as necessarily being the same thing. In support of the above-quoted paragraph, Farwell cited Dunlevy. But as we have noted, Dunlevy clearly held that the filing of a condemnation complaint is not a taking. Rather, a taking does not occur in Illinois until the condemning authority has paid the condemnation award and acquired the right to possess the property. Dunlevy, 91 Ill. at 54. ¶ 44 Dunlevy is consistent with this court's most recent decision grappling with the question of the point in time when a taking occurs under Illinois law. In Forest Preserve District v. West Suburban Bank, 161 Ill.2d 448, 455, 204 Ill.Dec. 269, 641 N.E.2d 493 (1994), this court noted that the issue of when a taking occurs in a condemnation proceeding is a somewhat amorphous question. In one sense, as a matter of legal fiction, it has been held that a taking occurs upon the filing of a complaint because the title acquired upon payment of just compensation relates back to the time of the filing of the complaint. See West Suburban, 161 Ill.2d at 455, 204 Ill.Dec. 269, 641 N.E.2d 493 (discussing City of Chicago v. McCausland, 379 Ill. 602, 41 N.E.2d 745 (1942)). But in a more corporeal sense, a taking does not take place until compensation has been ascertained and paid, because until that point, the owners continue to enjoy title and the rights associated with possession of the property. West Suburban, 161 Ill.2d at 455-56, 204 Ill.Dec. 269, 641 N.E.2d 493. ¶ 45 The appellate court here correctly noted that West Suburban's discussion of cases finding a taking dating back to the filing of the complaint concerned whether landowners were liable for property taxes assessed after the condemnation complaints had been filed. See 401 Ill.App.3d at 989, 341 Ill.Dec. 267, 930 N.E.2d 477. A party is liable for taxes on the property until compensation is paid and the landowner relinquishes title, but he may be reimbursed by the county for the taxes paid dating back to the filing of the complaint. Yet, the condemning authority could abandon the taking at any time before acquiring title, leaving the landowner liable for the taxes without any hope of reimbursement. We agree with the appellate court that the discussion in West Suburban of cases like McCausland does not inform our decision here regarding the time of a taking for purposes of the holding in Kirby. ¶ 46 Given that the condemning authority in an Illinois condemnation proceeding can abandon the proceeding at any time prior to making payment and acquiring title and the right to possession, we too find it difficult to fathom how a taking could occur any sooner. See Kirby, 467 U.S. at 12, 104 S.Ct. 2187 (the government's capacity to withdraw from the proceeding    would be difficult to explain if a taking were effectuated prior to tendering of payment); see also Danforth, 308 U.S. at 284, 60 S.Ct. 231 (Until taking, the condemnor may discontinue or abandon his effort[;] [t]he determination of the award is an offer subject to acceptance by the condemnor and thus gives to the user of the sovereign power of eminent domain an opportunity to determine whether the valuations leave the cost of completion within his resources.). Moreover, the fact that Illinois has a quick-take statute is further support for our conclusion that a taking did not occur upon the filing of the action. The option to file a quick-take proceeding giving the condemnor immediate right of possession would be superfluous if a taking had already occurred upon the filing of the complaint. ¶ 47 The District cites the United States Supreme Court's decision in Danforth to argue that the Supreme Court would recognize an exception to the time of taking is the time of payment rule in state condemnation proceedings where a state statute defines a different time of taking. We disagree that the exception noted in Danforth is applicable here. In Danforth, the Court held that the date of taking is the date the government pays for the land and acquires title. Danforth, 308 U.S. at 284, 60 S.Ct. 231. It found an exception to that holding exists for jurisdictions in which the taking occurs by a statutory provision, which fixes the time of taking by an event such as the filing of an action. Danforth, 308 U.S. at 284, 60 S.Ct. 231. The District argues that Illinois has such a rule fixing the date of taking as the date the condemnation action is filed. But we note that section 7-121 of the Illinois Eminent Domain Act does not mention when a taking occurs. Rather, it addresses only the date of valuation for purposes of determining just compensation at the condemnation proceedings. Thus, Illinois does not have a statute setting the date of taking earlier than the date of payment of the compensation award. Furthermore, to the extent that the District is arguing that Illinois has a state judicial rule setting the date of taking as the date of filing, we have already rejected that notion based on our readings of Dunlevy and West Suburban. ¶ 48 The District cites Brown v. United States, 263 U.S. 78, 44 S.Ct. 92, 68 L.Ed. 171 (1923), as an example of the kind of state statute that Danforth believed would qualify for the exception to the general rule that a taking does not occur prior to payment. But the Idaho statutory scheme at issue in Brown is clearly distinguishable from section 7-121 of our act. Among other differences, the scheme in Brown required the payment of interest to the defendant from the date of summons. Our statutory provisions do not require the payment of interest between the date of the filing of the condemnation action and the date of the judgment. ¶ 49 If a taking truly occurs under Illinois law upon filing, such would render our taking provisions unconstitutional in the absence of a statutory provision requiring the payment of interest to the landowner from the date of filing to the date of judgment. See Kirby, 467 U.S. at 11 & n. 16, 104 S.Ct. 2187 (citing United States v. 329.73 Acres of Land, Situated in Grenada & Yalobusha Counties, 704 F.2d 800, 812 & n. 18 (5th Cir.1983) (en banc) (the fifth amendment mandates not only that a landowner be awarded just compensation, represented by the fair market value of the property on the date taken, but also that just compensation in the constitutional sense is the fair market value of the property at the date of taking, plus interest from that date to the date of payment)). We can easily avoid that result, however, because we find no doubt that a taking does not occur for our purposes until, at the very earliest, the date the government deposits the condemnation award and is given the right to take title and possession.