The opinion of the court was delivered by: GETTLEMAN
Plaintiff RTC Commercial Assets Trust has filed a four count amended complaint seeking declaratory relief against defendant Phoenix Bond & Indemnity Company ("Phoenix"), Thomas C. Hynes in his capacity as Cook County Assessor, Edward J. Rosewell in his capacity as County Treasurer and County Collector, and David Orr in his capacity as County Clerk (jointly the "County Defendants"). Specifically, plaintiff seeks an order from this court declaring invalid certain tax liens, originally held by the County and later sold to Phoenix, on real estate property in which plaintiff owns a mortgage lien interest. Plaintiff also seeks a declaration that it has a right to a reassessment of the value of the real property for the tax years in question. Defendants have moved to dismiss all counts, arguing that the Tax Injunction Act ("TIA"), 28 U.S.C. § 1341, divests this court of subject matter jurisdiction, and that even if the court has jurisdiction, the complaint fails to state a claim pursuant to Fed. R. Civ. P. 12(b)(6). Plaintiff has moved for summary judgment on all counts. For the reasons set forth below, the court grants defendants' motion to dismiss as to Counts I, II, IV and portions of III. Plaintiff's motion for summary judgment is granted as to portions of Count III and denied as to all other counts.
Plaintiff is a Delaware business trust qualified to do business in Illinois, which holds a collateral assignment of 100% of the beneficial interest ("CABI") in a land trust as security for repayment of a loan to 185 North Wabash Partnership of approximately $ 904,000.00. The land trust holds an undivided one-half leasehold interest in two of six adjacent parcels of land, and an undivided one-half fee simple interest in four parcels which together have the common address of 185 North Wabash Avenue, Chicago, Illinois (the "Property"). Plaintiff also holds a leasehold mortgage encumbering all six parcels as security for repayment of a loan of $ 15,000,000. The CABI and mortgage were originally held by Trans Ohio Federal Savings Bank. On July 20, 1992, Trans Ohio was seized by the Resolution Trust Company ("RTC"), which was appointed receiver. As receiver, RTC succeeded to all of Trans Ohio's rights in and to the Property and loans. On October 24, 1995, the CABI and mortgage were assigned to plaintiff by the RTC as receiver.
Phoenix is alleged to be "an entity qualified to do business in Illinois which maintains offices and/or conducts business in Cook County, Illinois." On or about March 1, 1995, Phoenix purchased a tax certificate at a Cook County tax sale representing the 1993 real estate taxes on a portion of the Property. Phoenix subsequently purchased certificates representing the second installment of the 1991 real estate taxes, all of the 1992 real estate taxes, and the first installment of the 1994 real estate taxes.
On November 18, 1996, Phoenix filed a notice and petition in the Circuit Court of Cook County ("the Take Notice") to obtain by foreclosure a deed to a portion of the property represented by the tax certificates. The Take Notice provides that a petition for tax deed has been filed which would transfer title and right of possession of the property if redemption is not made on or before April 18, 1997.
Under Illinois law, "the taxes upon the property, together with all penalties, interest and costs that may accrue thereon, shall be a prior and first lien on the property, superior to all other liens and encumbrances, from and including the first day of January in the year in which the taxes are levied, until the taxes are paid or until the property is sold under this code." 35 ILCS 200/21-76. Thus, two of the liens in question, for the years 1991 and 1992, attached prior to RTC acquiring any interest in the property, while the liens for 1993, 1994, 1995, if they exist, attached after RTC acquired its interest, but prior to its assignment of that interest to plaintiff.
On March 14, 1997, plaintiff filed its second amended complaint. In Counts I and II, plaintiff seeks a declaration that pursuant to 12 U.S.C. § 1825(b)(2), the liens imposed by Cook County for the years 1993, 1994 and 1995, are void and that as a result, any attempt by Phoenix to attach liens or to foreclose on the real estate is void. In Count III, plaintiff seeks a declaration that pursuant to 12 U.S.C. § 1825(b)(3) neither Phoenix nor the County has a lien or a claim against plaintiff for any interest, penalties or other charges. Finally, in Count IV plaintiff seeks a declaration that pursuant to 1825(b)(1) it, as assignee of the RTC, is entitled to challenge the County Assessor's assessment of the real estate for the years 1991 through 1995.
shall not enjoin, suspend or restrain the assessment, levy or collection of any tax under state law where a plain, speedy and efficient remedy may be had in the courts of such state.
The limitation imposed by the TIA is jurisdictional. Colonial Pipeline Co. v. Collins, 921 F.2d 1237, 1242 (11th Cir. 1991). Thus the issue before the court is whether in any or all of its claims, plaintiff seeks to enjoin, suspend or restrain the assessment, levy or collection of any state tax.
While there have been a number of federal cases dealing with the Federal Deposit Insurance Corporation's ("FDIC") (or RTC's) rights to avoid real estate tax liens pursuant to Section 1825(b), few have addressed whether the TIA divested the court of subject matter jurisdiction. In Irving Independent School District v. Packard Properties, Limited, 741 F. Supp. 120 (N.D. TX 1990), a local school district brought suit seeking recovery of unpaid ad valorem real estate taxes. The County intervened as a plaintiff, and then the Federal Savings and Loan Insurance Corporation ("FSLIC") was added as receiver for the savings and loan that held a mortgage on the property. The FDIC, which had substituted for FSLIC, moved for summary judgment contending that under 12 U.S.C. § 1825 (B)(3) it could not be held liable for certain penalties and interest authorized by the Texas Tax Code when those taxes were not paid. In response, the County argued that the TIA prohibited the court from interfering with the County's collection of taxes, thereby divesting the court of jurisdiction.
The court held that the TIA does not preclude federal court jurisdiction over a suit brought to collect a state tax, but rather only divested the court of jurisdiction over suits brought to enjoin, suspend or restrain collection of taxes. Because the lawsuit was brought by the taxing authority to collect the tax, it was not precluded by the TIA. The court further held that the case was properly removed notwithstanding the TIA, relying on Carrollton-Farmers Branch Independent School District v. Johnson and Cravens, 858 F.2d 1010 (5th Cir. 1988), vacated on other grounds 889 F.2d 571 (5th Cir. 1989), which rejected the argument that the TIA precluded the FSLIC from ...