Cicero, towing company head to court over town's move to cut loose towing contract

By Scott Holland | Sep 28, 2015

Officials in Cicero want to stop paying a contractor for towing and impounding vehicles, and the resulting dispute has spilled over into Cook County Circuit Court.

Tuff Car Company, which has been the contracted towing firm for Cicero since 2005, earlier this month filed a complaint for injunctive relief against the town, which is seeking to terminate the contract before its scheduled expiration June 30, 2017. Tuff Car’s complaint also seeks declaratory judgment and a breach of contract ruling.

The business between the town and Tuff Car begin in 2005 as a three-year deal running through mid-2008. The terms called for three-year renewals if neither party objected, which is what happened in 2008, 2011 and 2014. Either party would be free to cancel at the end of a 36-window, provided it supplied written notice at least 60 days out.

But on Aug. 17, 2015, Tuff Car alleged Cicero sent the towing business a letter indicating a desire to terminate the contract and begin an in-house towing operation within 30 to 60 days. On Aug. 28, Cicero served Tuff Car a 30-day termination notice, demanding possession of the impound lot used to store towed cars. That notice said the town would prorate September rent down to $3,420; should Tuff Car still be on the premises after Sept. 27, the monthly holdover rental amount would be $7,600, due immediately.

Since 2005, the company has towed thousands of private vehicles ticketed by Cicero police, paying the town $20 for each car redeemed by its owner. Tuff Car is not supposed to release cars until the owners pay what is owed to police. Also as part of the deal, Tuff Car towed and changed tires on passenger vehicles and police vehicles owned by the town at no charge.

The letter Cicero Collector Fran Reitz sent to Tuff Car — which opens by stating “Cicero has enjoyed a positive relationship with Tuff … and we appreciate the service Tuff has provided” - says the end of the town’s street sweeping program reduced the need for towing services to the point officials considered it viable to bring towing in house. Further, the impound lot is in the assemblage area of a proposed Cicero aquatic center, a project which is nearing construction.

The termination notice sent to Tuff Car from the town of Cicero references a month-to-month commercial tenancy of the impound lot. In its complaint, Tuff Car argues its use of the lot is not a tenancy, but a required condition of the contract. If the company cedes use of the lot, Tuff Car argued, it would be unable to fulfill the obligations of the contract, which require any car towed must be stored at this particular lot at 1924 S. Laramie Ave. Tuff Car said it hasn’t held a lease for the lot, or paid rent or other charges, since at least Sep. 19, 2009.

By ordering the company to hand over the impound lot, the lawsuit’s breach of contract count alleged police and town officials “ordered Tuff Car to release thousands of properly-towed vehicles to their owners without payment,” while depriving Tuff Car of its towing fees (from $115 to $150 per vehicle, with $20 each returned to the town), as well as daily storage fees ($20 to $25 per vehicle). Altogether, Tuff Car estimated those losses at $2 million, which it seeks to recover through the lawsuit.

Tuff Car’s attorney is Arthur Sternberg, of the firm of Thompson Coburn, of Chicago. The company is seeking a jury trial.

The relationship between Tuff Car and the town of Cicero was the subject of an investigation earlier this year by the Better Government Association, which published its findings in an article published by the Chicago Sun-Times. That investigation asked questions about why the towing business had not paid rent to the town for its impound lot since 2009, how much the town had actually received from Tuff Car from its towing services, and the extent of relationships between Tuff Car owners and town officials, particularly noting one of Tuff Car’s owners is the father-in-law of Michael Del Gado, identified in the report as Cicero’s town attorney.

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Chicago Sun-Times Thompson Coburn LLP Town of Cicero

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