Justia Real Estate & Property Law Opinion Summaries

Plaintiff entered into a lease with the housing authority in 2007 as "Resident" and named her two sons as "Household Members." The lease provided that certain criminal activities could lead to immediate eviction. Plaintiff received a notice to vacate a few weeks later, after a visit by her daughter led to a gunfight in the parking lot. While plaintiff's challenge was pending, second and third notices issued. Police had been called to her apartment and determined that plaintiff had stabbed her husband, who was living at the apartment and was high on cocaine. Officers found joints on the counter. Plaintiff vacated. The district court granted summary judgment in favor of the defendants on federal claims and declined to exercise jurisdiction over state law claims. The Seventh Circuit affirmed. The case is moot because plaintiff never contested the second and third notices and, therefore, cannot be restored to the apartment; there was evidence that she lied on her application and was never eligible for tenancy. She incurred no expenses and state court proceedings provided all the process that was due. The court rejected a claim of emotional distress and a claim that the complex constituted segregated housing.

Husband and wife operated a mortgage fraud scheme that bought residential properties and sold those properties to nominee buyers at inflated prices. They provided lenders with false information about buyers' finances, sources of down payments, and intentions to occupy the residences. The scheme involved 37 separate transactions and resulted in net loss of more than $700,000 to various lenders. After the scheme collapsed, they went bankrupt but were not immediately prosecuted. Wife worked as a nurse in a pediatric intensive care unit. Husband worked as a installer and technician. They raised their three children and became fully engaged in their community. On the day before the ten-year statute of limitations would have expired, the government charged them with wire fraud, 18 U.S.C. 1343, and two counts of bank fraud, 18 U.S.C. 1344. They pled guilty to a single count of wire fraud, and were sentenced based on the 2010 USGS, wife to 41 months in prison, and husband to 63 months, and ordered to pay more than $700,000 in restitution. The Seventh Circuit remanded, stating that the sentencing judge failed to consider adequately unusually strong evidence of self-motivated rehabilitation. For this reason, we vacate their sentences

Plaintiffs, members of a religious organization, demonstrated around the stadium at which the 2006 "Gay Games" were held, but were prohibited from demonstrating and preaching on the sidewalk. They stopped demonstrating on the sidewalk outside a major tourist attraction (Navy Pier) under threat of arrest. One plaintiff, who refused to move from his spot on a public sidewalk outside one of the game venues, was arrested for disorderly conduct. The district court ruled in favor of the city defendants on claims under the U.S. Constitution, the Illinois Religious Freedom Restoration, and common law. The Seventh Circuit affirmed, except with respect to the First Amendment claim dealing with a policy requiring a permit for even small-group demonstrations outside Navy Pier. The constitutionality of that policy must be evaluated in light of the unique features of the location. The city's legitimate concerns justify its actions with respect to the other locations.

Plaintiff owns 2,485 acres containing Indiana's only antebellum plantation and 2,000 acres of "classified forest," with endangered species habitats. A utility company has a lease for storing and extracting oil and natural gas on portions of the property. The Lease continues so long as "oil or gas is produced in paying quantities" or "the Property continues to be used for the underground storage of gas" and will terminate upon the utility's surrender or failure to make payments. The lease contains provisions to protect historic sites and to calculate damage to trees, requires notice of utility activity, and requires that the utility's use be "as minimally necessary." Plaintiff sought damages and to terminate the lease and evict the utility. The district court entered judgment for the utility, finding that a disagreement about the use of land was not an express reason for termination and that the lease specifically provided that damages were the proper remedy. Plaintiff dismissed the damages claim with prejudice to appeal the ejectment claim. The Seventh Circuit affirmed. Plaintiff did not show that damages are inadequate to compensate for the harm to its property.

In 2000, plaintiff sold 6600 acres of farmland for $16.35 million to an environmental organization, which wanted to restore it as an ecologically functional floodplain for the Illinois River. Plaintiff expressly warranted that there was no petroleum contamination. The organization discovered such contamination and sued. The district court awarded $800,000 in damages, some for a separate breach, failure to clean up livestock waste from lagoons. Plaintiff unsuccessfully appealed and filed suit against the local drainage district, which had a right of way and equipment on the land to pump surface waters into the river. The district stored petroleum in tanks; at least one was on the organization's land. The organization, wanting to restore the land as wetlands, turned off the pumps. The district court entered summary judgment for the district. The Seventh Circuit affirmed. A blameless contract breaker cannot invoke noncontractual indemnity to shift risk that he assumed in a contract. The suit is also barred by the economic-loss doctrine, based in part on concern with liability for unforeseeable consequences.

Plaintiff, a freight railroad, owned a spur line connecting to a plastics plant, the only shipper located on the spur. Defendant, another railroad, bought the lines, including the spur. The sales contract allowed plaintiff to continue to run trains on the lines being sold and granted plaintiff an exclusive easement to use the spur to serve the plant. Several years later, the plant entered receivership. The receiver sold all assets, including the plant. The buyer continues to manufacture plastics in the plant. Contending that the change in ownership voided the exclusive easement, defendant contracted with the buyer to ship products over the spur, leaving plaintiff with diminished use of the spur. The district court ruled in favor of defendant, reasoning that the contract referred specifically to the plastics company in business at that time. The Seventh Circuit affirmed, based on the language of the contract in light of extrinsic evidence, and rejected a trespass claim.

Defendant, a participant in a major mortgage fraud scheme, pled guilty to committing wire fraud as part of that scam and was sentenced to 37 months in prison and ordered to pay $1,792,000 in restitution. His role was to act as a "straw," or fake, buyer of seven properties, and to cause $4,473,161.55 to be transferred from unwitting mortgage companies to their banking partners; he received $90,000 from his co-schemers. The Seventh Circuit affirmed in part, reversed in part, and remanded. The district court acted within its discretion in rejecting defendant's assertion that his sentence should be lower because he gave the government substantial assistance. The court should have explained its rationale in attributing a "reasonably foreseeable" loss amount to defendant. The court also erred in interpreting the minor role sentencing adjustment guideline when it stated that an act otherwise deemed minor could, if repeated, necessarily preclude the adjustment, and that a person playing a necessary role cannot play a minor role. The court should evaluate his role in context of other participants in the scheme, keeping in mind that a minor player is substantially less culpable than the average participant, not the leaders.

In 2000 the conservancy purchased property, but allowed the farmer to remain as a tenant through 2003. The farmer/seller was required to perform removal of specified substances and warranted that there were no undisclosed underground tanks. The conservancy withheld funds pending clean-up. In 2006 the conservancy sued for breach of the warranty and failure to complete the clean-up. The district court allowed the conservancy to amend and claim damages with respect to newly-discovered contamination and entered judgment in favor of the conservancy. The Seventh Circuit affirmed. The claim is within the Illinois 10-year limitations period for actions and written contracts; the doctrine of laches does not apply.

A developer was required to make public improvements to be turned over to the city and, in 2006, obtained bonds to ensure performance, as required by ordinance. Work began, but the subdivision failed and subcontractors filed mechanics' liens. The developer notified the city that three foreclosures were pending and recommended that it redeem the bonds. The insurer refused to pay. The city did not follow up, but a subcontractor sued, purporting to bring its case in the name of the city for its own benefit. The subcontractor contends that it should be paid out of the proceeds of the bonds. The case was removed to federal court. The district court dismissed, finding that the subcontractor did not have standing to assert claims on the bonds because it was not a third-party beneficiary to the bonds. The Seventh Circuit affirmed, based on the language of the contract.

A developer was required to make public improvements to be turned over to the city and, in 2006, obtained bonds to ensure performance, as required by ordinance. Work began, but the subdivision failed and subcontractors filed mechanics' liens. The developer notified the city that three foreclosures were pending and recommended that it redeem the bonds. The insurer refused to pay. The city did not follow up, but a subcontractor sued, purporting to bring its case in the name of the city for its own benefit. The subcontractor contends that it should be paid out of the proceeds of the bonds. The case was removed to federal court. The district court dismissed, finding that the subcontractor did not have standing to assert claims on the bonds because it was not a third-party beneficiary to the bonds. The Seventh Circuit affirmed, based on the language of the contract.