APPEAL from the Circuit Court of Lake County; the Hon. LLOYD
A. VAN DEUSEN, Judge, presiding.
MR. PRESIDING JUSTICE GUILD DELIVERED THE OPINION OF THE COURT:
The sole question presented in this case is whether the trial court properly awarded plaintiffs attorney's fees out of a tax fund set up by the Lake County treasurer.
In July 1975 plaintiffs filed a class action suit on behalf of Illinois taxpayers residing outside of Lake County. The complaint sought to hold that the provisions of section 21 of the Inheritance and Transfer Tax Law (Ill. Rev. Stat. 1973, ch. 120, par. 394) were unconstitutional due to the adoption of article VII, section 9(a) of the Illinois Constitution. The statutory provision authorized the county treasurer to retain and pay into the county treasury 4 percent of all taxes paid to him for the State of Illinois under the Act. The complaint further sought a temporary and permanent injunction enjoining the Lake County treasurer from retaining the 4 percent fees and that the same be segregated and placed in a trust fund to be distributed pursuant to the order of the circuit court of Lake County.
The record discloses that the county treasurer of Lake County had, in fact, already segregated these funds and deposited the same in several qualified banking depositories since December 1971, the effective date of the relevant constitutional provision. At the time of the filing of the instant lawsuit the treasurer of Lake County had accumulated $792,653.75, deposited in qualified banking depositories. On January 7, 1976, the parties hereto stipulated that this fund would not be paid out. At that time the fund had increased to $859,147.60. Thus, this fund was not established in the original instance as a fund for the class represented by counsel for the plaintiffs.
During the pendency of the proceedings below it was pointed out that the attorneys representing the plaintiffs herein had filed a similar class action in Cook County on behalf of all taxpayers of Illinois residing outside of Cook County. It was represented that this case was on appeal to the supreme court. As a result thereof, the proceedings of the trial court herein were stayed pending the decision by the supreme court. On December 3, 1976, the supreme court rendered its decision in Goldstein v. Rosewell (1976), 65 Ill.2d 325, 357 N.E.2d 1157, holding the statutory provision in question herein unconstitutional. Subsequently, plaintiffs herein moved for and were granted judgment on the pleadings; the defendants were ordered to file an accounting of the funds retained from December 1, 1971, and were enjoined from transferring or disposing of these funds.
Plaintiffs' attorneys then petitioned the trial court for attorneys' fees in the sum of $60,295. At this juncture the State of Illinois filed objections to the allowance of attorneys' fees but refused to formally intervene, and the objections were subsequently stricken by the trial court for lack of standing by the State of Illinois. On the same date the court awarded the sum of $30,800 as attorneys' fees to the attorneys for the class. The order further provided for the payment of costs and that the Lake County treasurer be directed to issue vouchers drawn upon the special account representing these fees in the sum of $30,800, together with costs in the sum of $101.60. The order further provided that these fees be paid from this special account and that the balance of the funds in the special account, after payment of these fees and costs, be paid to the Treasurer of the State of Illinois. Only at this time did the State (unsuccessfully) attempt to intervene. The order was subsequently modified whereby $100,000 of the escrowed funds were to be paid to the clerk of the circuit court subject to its order and the balance remaining to the State of Illinois.
This appeal is by the Attorney General of Illinois and the State Treasurer. The plaintiffs herein have filed a motion to dismiss the appeal on the basis that the appellants were not parties to the proceedings below in the trial court and therefore lack standing; that new grounds for reversal cannot be first raised on appeal; and that they have accepted the benefits of the order they now seek to appeal and are, therefore, barred from appealing. Objections were filed to this motion, and we have ordered the motion and the objections thereto taken with the case.
The first issue presented to us is whether the Attorney General and the Treasurer of the State of Illinois, on behalf of the State of Illinois, have the power and authority to bring this appeal. We conclude that they do and refuse to dismiss the appeal.
1, 2 Although the State was not a party to the initial suit, nonparties have a right to appeal under certain circumstances. Whether they have standing is dependent on whether they have some direct, immediate and substantial interest in the subject matter which would be prejudiced by a judgment or benefitted by its reversal. (Flanagan v. Hulman (1970), 121 Ill. App.2d 382, 257 N.E.2d 599.) Plaintiffs admit this to be the law, but contend that neither the Attorney General nor the Treasurer of Illinois have such interest as would give them this standing. We disagree. In People ex rel. Pollastrini v. Whealan (1933), 353 Ill. 500, 187 N.E. 491, the State filed a petition for a writ of mandamus on behalf of a deputy bailiff, naming the president of the board of commissioners, the treasurer and the controller of Cook County as defendants, and requesting that they be ordered to issue and pay warrants for the deputy bailiff's salary. The trial court ordered the writ and the appellate court affirmed. Only then did Cook County itself attempt to enter the proceedings by prosecuting a writ of error to the supreme court. That court held that the writ was properly brought by the county, reasoning that:
"The judgment rendered by the trial court requires the issuance of warrants for the salary claimed. These warrants, if sustainable, must necessarily be satisfied out of the county's funds. Manifestly, the county will be benefited by a reversal of the judgment. The county of Cook therefore has the right to prosecute a writ of error for review of the record; * * *." 353 Ill. 500, 503, 187 N.E. 491, 493.)
The instant case is very similar to Pollastrini. The award of attorneys' fees would, if sustained, be satisfied from funds that would otherwise be the property of the State.
Plaintiffs argue that the monies in the hands of the county treasurer are not State funds "since they [have] never been deposited in the State Treasury" but rather are "funds of Lake County which became subject to the court's jurisdiction and which after the amounts of fees and costs would be turned over to the State by the court." This is a dubious argument in light of the fact that the substantive basis of plaintiffs' suit was the contention that the State had the right to the money being held by the county treasurer. Having succeeded in their efforts to show that the money should rightfully belong to the State, plaintiffs now contend that this is not State money. We cannot agree. If the State has a right to the money, the fact that it is not yet in the treasury does not make it any less the State's money for purposes of whether the State has an appealable interest.
3, 4 Plaintiffs further contend that (1) the State asserts grounds for reversal not presented to the trial court and (2) that having accepted some of the benefits of this litigation the State is precluded from attacking the validity of an order entered in this proceeding. As to (1) above, the ground for reversal attacks the jurisdiction of the court to award fees and costs from State funds (the merits of this contention are hereafter discussed in this opinion). An order or decree entered by a court which lacks the inherent power to make or enter the particular order involved is void and may be attacked at any time and in any court. (City of Chicago v. Fair Employment Practices Com. (1976), 65 Ill.2d 108, 357 N.E.2d 1154.) As to (2) above, the record shows that the substantive decision on the constitutionality of the statute was made by the trial court in its decree of January 18, 1977, while the award of attorneys' fees was the subject of a separate order entered June 21, 1977. The validity of the order of June 21 is the issue in this appeal; it is a separate order entered 6 months after the decree ruling on the merits of this case. In any event, it is severable from the January 18 order. When a decree is severable an appeal can be taken from the severable portion or from a part dealing with a particular subject. (Kerner v. Thompson (1937), 365 Ill. 149, 6 N.E.2d 131.) Under these circumstances we hold that the benefits accruing to the State as a result of the January 18 order are not such as to preclude the State's jurisdictional attack on the June 21 order.
Having held that the State can properly prosecute this appeal, we now turn to the substantive question before us: namely, whether the trial court could properly award the attorneys' fees and costs. The State contends that the court's awards were improper for three reasons: (1) that the doctrine of sovereign immunity operates to void the jurisdiction of the trial court on these fees; (2) that the State was an indispensable party to the petition and that the failure to make the State a party bars the ...