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10/20/88 In Re October 1985 Grand Jury No. 746 (Bernard Drebin

October 20, 1988

IN RE OCTOBER 1985 GRAND JURY NO. 746 (BERNARD DREBIN,


SUPREME COURT OF ILLINOIS

Appellant)

530 N.E.2d 453, 124 Ill. 2d 466, 125 Ill. Dec. 295 1988.IL.1550

Appeal from the Appellate Court for the First District; heard in that court on appeal from the Circuit Court of Cook County, the Hon. Richard J. Fitzgerald, Judge, presiding.

APPELLATE Judges:

JUSTICE WARD delivered the opinion of the court. JUSTICE STAMOS took no part in the consideration or decision of this case. JUSTICE CLARK, Dissenting.

DECISION OF THE COURT DELIVERED BY THE HONORABLE JUDGE WARD

Bernard Drebin, a certified public accountant , appeals the appellate court's decision ordering his compliance with a subpoena duces tecum served upon him in the course of a Cook County grand jury investigation of his tax clients, Jack and Wanda Bernstein. The Attorney General in October 1985 commenced a grand jury investigation of the Bernsteins for alleged underpayment of retailers' occupation taxes and Illinois income taxes for 1982, 1983, and 1984. Drebin had prepared the Bernsteins' tax returns for the years under investigation. The grand jury issued a subpoena duces tecum directed to Drebin calling for production of the following:

"etained copies of U.S. income tax returns prepared by you for Jack and Wanda Bernstein, . . . d/b/a Milwaukee Products, for the years 1982, 1983 and 1984 together with any and all schedules or attachments thereto; retained copies of Illinois income tax returns prepared by you for the above Jack and Wanda Bernstein for the years 1982, 1983 and 1984 together with any and all schedules or attachments thereto; any written material provided to you by the above Jack and Wanda Bernstein and used by you in preparation of any of the tax returns or attachments or schedules referred to above; and any and all worksheets or workpapers prepared by you for use in preparing any of the tax returns or attachments or schedules referred to above."

In response to the subpoena, Drebin appeared before the grand jury and answered questions of an assistant Attorney General concerning his identity and whether he was served with a subpoena. Drebin then responded to questions concerning the Bernsteins and their tax returns:

"I am a certified public accountant duly licensed by the State of Illinois. I respectfully decline to answer that question pursuant to Illinois Revised Statutes, Chapter 111, Section 5533 which provides that I, as a public accountant, am not required to divulge information or

evidence which has been obtained by me in my confidential capacity as a public accountant."

The assistant Attorney General halted the interrogation and later appeared before the presiding Judge of the Cook County circuit court criminal division, asking for a rule to show cause why Drebin should not be held in contempt. The court declined to enter a rule and asked the parties to present the issue in the form of a motion to quash the subpoena. The court granted the motion to quash, ruling that, under the statutory privilege asserted (Ill. Rev. Stat. 1985, ch. 111, par. 5533), an accountant could not be compelled to provide the information sought by the subpoena.

On the State's appeal to the appellate court, that court held that the State had the right to appeal the order quashing the subpoena under Supreme Court Rule 301 (107 Ill. 2d R. 301). The court also held that Drebin was obliged to comply with the subpoena, stating that the information sought was not confidential. (154 Ill. App. 3d 288.) This court granted Drebin's petition for leave to appeal under our Rule 315 (107 Ill. 2d R. 315), and the Illinois CPA Society was given leave to file an amicus curiae brief in support of Drebin's appeal.

Drebin first contends that the appellate court erred in holding that the State may, as a final judgment under Rule 301, appeal a trial court's decision quashing a subpoena duces tecum that was issued pursuant to a grand jury investigation. He says the court's order is not appealable, as the proceeding from which the order arose is not a "case" under either the civil or criminal rules for appeals. The State states that the appellate court properly concluded that the circuit court's order is appealable under Rule 301 as a final judgment in a civil case.

The appellate court did recognize that this court, in In re February 1970 Cook County Grand Jury (1970), 46 Ill. 2d 448, has held that the State may not appeal, under Supreme Court Rule 604(a)(1) (107 Ill. 2d R. 604(a)(1)), the granting of a motion to quash a grand jury subpoena duces tecum. Rule 604(a)(1) provides:

"In criminal cases the State may appeal only from an order or judgment the substantive effect of which results in dismissing a charge for any of the grounds enumerated in section 114 -- 1 of the Code of Criminal Procedure of 1963; arresting judgment because of a defective indictment, information or complaint; quashing an arrest or search warrant; or suppressing evidence." (107 Ill. 2d R. 604(a)(1).)

In holding that Rule 604(a)(1) does not authorize the State to appeal the quashing of a subpoena issued in a grand jury investigation, this court stated that a grand jury investigation is not a criminal case within the meaning of Rule 604(a)(1) and "appeal is not the proper vehicle for review of the challenged orders." (In re February 1970 Cook County Grand Jury, 46 Ill. 2d at 450.) That decision followed the reasoning in People v. Ryan (1951), 410 Ill. 486, cert. denied (1952), 343 U.S. 964, 96 L. Ed. 1361, 72 S. Ct. 1057, which held that "[a] proceeding before a grand jury is not a pending action but rather a secret investigation ...


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