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C.a. Powley Co. v. Dept. of Local Gov't Affairs





APPEAL from the Circuit Court of Fulton County; the Hon. EZRA J. CLARK, Judge, presiding.


Petitioners, C.A. Powley Co., N.E. Finch Co., Peoria Marine Construction Inc., and Strunk Bros. Co., hereinafter referred to as taxpayers, commenced this action in the circuit court of Fulton County seeking to review the final order of the Illinois Department of Local Government Affairs. The action was commenced pursuant to the provisions of the Administrative Review Act (Ill. Rev. Stat. 1973, ch. 110, par. 264 et seq.) and resulted in a decision approving the Board's order.

Each of the taxpayers is a corporation properly doing business in Illinois. In May 1973 each taxpayer received a notice from Vernon Thomson, Fulton County supervisor of assessments. The notice directed each taxpayer to file a personal property tax return with respect to its construction equipment located in Fulton County. To avoid the assessment of a penalty each taxpayer filed a return protesting the assessment of its property and thereafter argued their protest before the Board of Review. The Board of Review denied the protest and the taxpayers sought a further determination of the merits of their claims before the Illinois Department of Local Government Affairs. The final order of the Department found the construction equipment involved was properly assessed and taxed in Fulton County. The amounts of the assessments ranged from $159,000 to $7,000.

Central Illinois Light Company, which has its principal office in Peoria, Illinois, is constructing a new generating facility in Fulton County. Each of the taxpayers is in the construction and excavating business and is under contract to perform various parts of the Fulton County project work either as contractor, subcontractor or joint venturer. The job was of indefinite duration, although it was estimated it would take from one to three years to complete. The personal property which is the subject of this proceeding is large, self-propelled movable excavating and highway construction equipment. None of the property is permanently affixed to real estate.

Each of the taxpayers has its headquarters, principal place of business and the address of its registered agent in some other county of Illinois other than Fulton County. None of the taxpayers has an office in Fulton County and no supervisory employee resides in Fulton County. The Central Illinois Light Company job is the only job which any of the taxpayers was doing in Fulton County.

Each of the taxpayers commenced work on the job in the latter half of 1972 by moving heavy construction equipment to Fulton County. The property which the taxpayers were required to include in their returns was the property on the job site in Fulton County on April 1, 1973. Subsequent to April 1, 1973, some of the equipment so listed was moved to other jobs outside Fulton County and likewise other equipment belonging to the taxpayers was moved into Fulton County for use on the job.

It was originally alleged that assessment of the personal property in Fulton County represented double taxation because the same property had been assessed in other counties, namely the county in which each taxpayer claimed to have its principal place of business. The proof did not support such claim and consequently no issue is presented on this appeal on any claim of double taxation.

On this appeal the taxpayers have argued the county of Fulton was without jurisdiction to assess the construction equipment, and in particular, that such assessment is not authorized by the Illinois Revenue Act of 1939. The statutory provisions with which we are primarily concerned are sections 57 and 72 of the Revenue Act of 1939 (Ill. Rev. Stat. 1973, ch. 120, pars. 538 and 553). Section 57 provides:

"Personal property, except such as is required by this Act to be listed and assessed otherwise, shall be listed and assessed in the taxing district where the owner resides. The capital stock and franchises of corporations and persons, and all intangible personal property of foreign corporations doing business in this state which is located in this state and used in their business transacted within the state, except as may be otherwise provided, shall be listed and taxed in the taxing district where the principal office or place of business of such corporation is located in this state, or, if there be no principal office or place of business in this state, at the place in this state where any such corporation or person transacts business."

Section 72 provides:

"The personal property of banks or bankers, brokers, stockjobbers, insurance companies (except life insurance companies organized under the laws of this State), fraternal beneficiary societies (except those organized under the laws of this State), hotels, livery stables, saloons, eating houses, merchants and manufacturers, ferries, mining companies and companies not specifically provided for in this Act, shall be listed and assessed in the taxing district where their business is carried on, except such property as shall be liable to assessment elsewhere in the hands of agents. * * *"

The property of the taxpayers was assessed under section 72. In support of their argument this is improper, the taxpayers have generally urged their property falls within section 57.

The general rule of assessment is, according to the taxpayers, personal property should be assessed in the taxing district in which the owner of the property has his domicile. Since a corporation is generally considered to have its domicile at the place of its principal place of business or principal offices, it follows according to the taxpayers, that the application of the domiciliary rule would preclude the personal property involved in this case from having a taxable situs in Fulton County.

We have no particular disagreement with taxpayers' general thesis. However, section 57 is a general provision and is limited by subsequent provisions which deal with taxpayers or property under special circumstances. Indeed, the taxpayers have called our attention to other sections of the Act dealing with the assessment of personal property under special conditions contending such provisions evidence the legislative intention that the physical location of the personal property is not the principal contact warranting taxation. We discern no such intention. In fact, some of the provisions such as those applicable ...

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