Robert H. Rosenfeld & Associates wins epic legal battle against Illinois International Port District

As reported on page 1 of the November 13, 2013 edition of the Chicago Daily Law Bulletin:

Port district loses eviction case appeal

The Illinois International Port District tried to evict a tenant in its harbor, but a 1st District Appellate Court panel nixed those plans in a ruling Tuesday. It’s the fourth appellate decision in the past 11 years between the port district and Dockside Development Corp., who have been mired in decades of legal battles over the dredging of a boat slip on Lake Calumet.

In a 23-page unpublished order, Justice Mathias W. Delort determined the port district could not evict Dockside for breaching a 48-year-old contract due to an agreement the parties signed in 1984.

In 1965, Dockside signed a 65-year lease with the port district, which required excavating a boat slip at 12100 S. Stony Island Ave. to 27 feet deep so large ships could dock there. The dredging was to be done at Dockside’s expense. Once the work was completed, the agreement required the port district to maintain the slip through 2030 while Dockside operated a shipping terminal.

However, the slip was never dredged deeper than 25 feet. The two sides fought over the responsibility for decades before signing a release agreement in 1984.

In January 1998, Dockside sued the port district in Cook County Circuit Court seeking a declaration that the district must maintain the slip. After a 2002 remand from the appellate court, a trial court found that the release agreement removed a timeline for completing the dredging, but not the district’s right to demand its completion.

The case made a second trip to the appellate court in 2005 when a panel affirmed the trial court’s ruling.

After that decision, the port district demanded Dockside complete the task. When Dockside didn’t, the port district in 2007 filed a complaint to evict it from the property, claiming it had breached the terms of its lease.

The eviction case revolved around the 1984 release agreement, which developed after Dockside planned to sublet a portion of its parcel to a steel manufacturer. The port authority said the release only dealt with the subleased area, while Dockside said it applied to the boat slip as well.

The trial court granted summary judgment to Dockside on grounds the suit was barred by res judicata. But on appeal, that decision was reversed.

In 2011, after the remand, the port district filed a second complaint seeking damages from the default on the lease and to recover attorney fees.

Dockside moved for summary judgment in September 2011 based on the discovered release letter. It also argued that the shallow slip was immaterial, since larger ships were using newer slips the port district built closer to the lakefront.

In May 2012, then-Associate Judge Sheldon C. Garber granted summary judgment to Dockside, determining the release letter had no language to limit its effect from the slip.

“I don’t know how it could be spelled out any cleaner,” Garber said at the time. The current appeal was filed the next month.
In Tuesday’s order, the appellate panel affirmed Garber’s ruling, given the new evidence of the letter.

“We likewise find the release between the parties is dispositive of the outcome of all the pending claims here,” Delort wrote.

The panel ruled that the facts of the case had “substantially changed” because the letter shows the port district’s former lawyer signed the release and the board voted to approve it in 1984.

“A clear trail of evidence supports the circuit court’s finding that the [p]ort [d]istrict released Dockside from all its obligations under the three leases previously executed,” Delort wrote.

The appellate court noted that the port district was aware of the slip’s depth issue as early as 1969, 25 years before the release letter.
“In other words, the [p]ort [d]istrict’s claim of alleged breach for Dockside’s failure to excavate Slip No. 2 to 27 feet was in the contemplation of the parties at the time the parties executed the release and the board consented,” he wrote.

Justices Maureen E. Connors and Thomas E. Hoffman concurred in the order.

The port district was represented by Michael D. Leroy and Richard F. Friedman of Neal & Leroy LLC. Friedman said the district is disappointed with the decision and is evaluating its next steps.

Friedman said the port district did not believe the discovery of the signed letter was relevant to the issue.

“The question is what they meant, not whether they were signed,” Friedman said. “That was the hook that the trial court and appellate court based their decision on.”

Dockside was represented by Robert H. Rosenfeld, owner of Robert H. Rosenfeld & Associates, and sole practitioner William R. Coulson.
In a statement, Rosenfeld said Dockside is pleased to continue working from the harbor without litigation looming.

“Despite having released Dockside, in writing, in 1984 of any existing breaches of the lease, (the port district) for some reason persisted in expending public moneys on its lawsuit to try to oust Dockside — a loyal and successful long-time tenant,” he said.

“We are glad the case is finally concluded and the parties can get on with their business lives.”

The case is Chicago Regional Port District v. Dockside Development Corporation, 2013 IL App (1st) 121906-U.