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R.d. Werner Co. v. Leyden Fire Protection Dist.





APPEAL from the Circuit Court of Cook County; the Hon. REGINALD J. HOLZER, Judge, presiding.


This is a consolidated appeal from certain orders of the Cook County Circuit Court which enjoined defendants Leyden Fire Protection District (Leyden) and county tax officials from extending, collecting, and distributing real estate taxes assessed against plaintiffs' property. The named plaintiffs brought the suit as a class action, seeking the injunction and an accounting. On appeal, Leyden contends that: (1) the trial court erred in exercising equitable jurisdiction over this dispute because plaintiffs had adequate legal remedies available; (2) the trial court's certification of the class was erroneous because tax protest questions may not be resolved through class action suits; (3) plaintiffs failed to satisfy the statutory requisites for maintaining a class action; (4) the trial court erred in sequestering the tax funds in issue and in appointing a trustee for all 1979 tax funds collected by Leyden's levy; (5) the trial court erred in ruling that the members of plaintiffs' class would be deemed to have paid the second installment of their 1979 real estate taxes "under protest" if that installment were collected pursuant to the court's modification of its original injunction order; and (6) the injunction deprives Leyden of funds necessary to provide fire protection and paramedic services for the residents in its unincorporated areas. Plaintiffs, in their cross-appeal, contend that (1) the trial court erred in determining that any taxes previously paid by plaintiffs without protest are not recoverable; (2) the court erred in distributing $87,800 from the sequestered funds to Leyden; (3) plaintiffs are entitled to an accounting for tax money wrongfully collected over past years; and (4) the trial court erred in excluding from plaintiffs' class those taxpayers whose properties, annexed to other municipalities, are subject to pending lawsuits to prevent disconnection from the Leyden District.

We reverse the judgment. The circumstances of this case follow.

Leyden Fire Protection District is a municipal corporation and taxing body organized in 1949 pursuant to "An Act in relation to fire protection districts." (Current version in Ill. Rev. Stat. 1979, ch. 127 1/2, par. 21 et seq.) Under the Act, Leyden taxes all properties within the district and provides fire protection service to its residents and occupants.

In 1965, the Illinois General Assembly amended the Act to provide for the disconnection from a fire protection district of any territory within a district which is or has been annexed to a city, village, or unincorporated town that also provides fire protection for property within its limits. This section provides that such disconnection is "by operation of law" and is effective, automatically, unless the fire protection district files a petition to prevent disconnection. The district must file its petition within 60 days after the annexation and must allege and prove that the disconnection will cause its remaining territory "to be noncontiguous, or that the loss of assessed valuation by reason of such disconnection will impair the ability of the district to render fully adequate fire protection service to the territory remaining with the district." (Ill. Rev. Stat. 1979, ch. 127 1/2, par. 38.3).

The property at issue in this appeal includes 738 parcels of real estate originally within Leyden's boundaries, which have been annexed, since 1949, to the villages of Franklin Park, Bensenville, and Melrose Park.

On February 24, 1966, Leyden filed a petition to prevent disconnection from its boundaries of those properties annexed to the village of Franklin Park prior to July 1, 1965. *fn1 The circuit court held that Leyden's petition was not timely filed under section 38.3 and that the Franklin Park annexations had been disconnected from Leyden, by operation of law, on January 1, 1966. In re Leyden Fire Protection District (1972), 4 Ill. App.3d 273, 280 N.E.2d 744.

Despite the court's holding, those parcels have continued to be included in Leyden's tax assessments. In addition, plaintiffs contend, most of the parcels annexed to the other municipalities have also continued to be taxed. As a result, the members of plaintiffs' class have been taxed twice on their property. They also have received "double" fire protection services, from Leyden as well as from the annexing municipality.

On March 3, 1980, plaintiffs filed a class action suit against defendants seeking injunctive relief from further taxation, as well as an accounting for past taxes paid by plaintiffs. In substance, plaintiffs allege that since 1966 defendants have wrongfully continued to tax their "disconnected" property and should be enjoined because the taxes are "unauthorized by law." *fn2 In response, Leyden asserts that plaintiffs have an adequate remedy at law.

On March 6, 1980, after receiving numerous documents as evidence the trial court granted plaintiffs' motion for preliminary injunction to prevent defendants' distribution of real estate taxes already collected for the first installment of the 1979 assessment. The court also permitted the suit to be maintained as a class action, defining the class as "all taxpayers who own and lease taxable property within Leyden Fire Protection District's original boundaries, but which property has been annexed to a city, village, incorporated town or other like municipality, which provides fire protection to the property within its limit." The trial court further ordered the county treasurer to sequester and deposit in an interest-bearing account all taxes that were or would come into his possession for the Leyden District.

The trial of the case commenced on April 30, 1980. The court accepted the parties' written stipulation of facts. Plaintiffs introduced several documents which, along with the numerous exhibits they presented at the hearing for a temporary injunction, constituted their case. Defendant Leyden called as its witness Arthur Solomon, supervisor of the county clerk's map department. He testified as to the procedures of the clerk's office relating to disconnection of property from fire protection districts. Solomon stated that unless his office receives a fire protection district's petition to prevent disconnection of its property, the property is automatically disconnected by operation of law, upon its annexation by another municipal corporation. With respect to plaintiffs' land parcels that were the subject of the court's judgment in In re Leyden Fire Protection District (1972), 4 Ill. App.3d 273, 280 N.E.2d 744, Solomon stated that these parcels were never disconnected because Leyden's attorney had filed a petition to prevent their disconnection and Solomon had had no further conversations with anyone involving that petition, or its disposition by the court.

On June 2, 1980, the trial court entered its final order, various provisions of which are the subject of this appeal. In granting plaintiffs' request for injunctive relief, the trial court held, among other things, that (1) as of June 2, 1980, Leyden's tax levy on plaintiffs' property would be considered "unauthorized"; (2) the levy and collection of 1979 real estate taxes upon plaintiffs' property would be permanently enjoined; (3) $87,800 of the funds collected pursuant to the trial court's March 6 sequestration order would be distributed to Leyden and that the balance would be transferred to a court-appointed trustee; (4) plaintiffs were not entitled to an accounting. On June 20, 1980, the trial court modified its June 2 "Final Order," after hearing Leyden's motion to stay enforcement of the judgment pending appeal. At that time the court held that (1) the county clerk could collect the second installment of the 1979 real estate taxes; (2) the sequestered funds and any future funds coming into the Cook County treasurer's possession would be turned over to the court's appointed trustee; and (3) any real estate taxes paid by plaintiffs' pursuant to the modified order would be deemed paid under protest pursuant to section 194 of the Revenue Act (Ill. Rev. Stat. 1979, ch. 120, par. 675).

The parties filed the appropriate notices of appeal from the June 2 order and interlocutory appeal from the June 20 modification order. These appeals ...

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