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In re Application of Cook County Treasurer

December 31, 1998

IN RE APPLICATION OF THE COOK COUNTY TREASURER AND EX OFFICIO COUNTY COLLECTOR OF COOK COUNTY, ILLINOIS, FOR ORDER OF THE JUDGMENT AND SALE AGAINST REAL ESTATE RETURNED DELINQUENT FOR THE YEAR 1993 (LOOP MORTGAGE CORPORATION ETAL., APPELLANTS,
v.
MURRAY WILLIAMS, APPELLEE



The opinion of the court was delivered by: Justice Heiple

37-September 1998.

Murray Williams redeemed a parcel of property located at 4446 S. Greenwood in Chicago after it was sold at a tax sale to Loop Mortgage Corporation. The circuit court of Cook County granted Loop Mortgage's petition to expunge the redemption. Williams appealed, and the appellate court reversed, holding Williams, acting under power of attorney for the owner of record title to 4446 S. Greenwood, had a right to redeem the property under section 21-345 of the Property Tax Code (35 ILCS 200/21-345 (West 1996)). 294 Ill. App. 3d 557. We granted leave to appeal (166 Ill. 2d R. 315) in order to determine whether the owner of record title to the property, even if she has no legal or equitable title to the property, has a right to redeem. We hold an owner of record title who has no legal or equitable interest in the property has no right to redeem, but we affirm the appellate court on different grounds.

BACKGROUND

At the time of her death in 1986, Halove Abram owned a property located at 4446 S. Greenwood in Chicago. Abram died intestate, and her sister Chappel Cummings inherited the property. Cummings is incompetent, and Cummings' daughter Agnes Lee has authority to act on her behalf regarding the property. In 1989, Lee signed a contract to sell 4446 S. Greenwood to Alfred Smith. There is a substantial disagreement between the parties regarding the terms of their agreement, but it is undisputed that Lee conveyed a warranty deed to Smith for the property at 4446 S. Greenwood. Smith never recorded the deed, and Halove Abram remained the owner of record. Smith took possession of 4446 S. Greenwood immediately after Lee signed the contract.

Smith paid the back taxes up to tax year 1989, but neither Smith nor Lee paid property taxes for tax years 1990 and 1991. Fitz Corporation purchased 4446 S. Greenwood at a tax sale in 1993. Fitz Corporation subsequently sold its interest in the property to Loop Mortgage Corporation. Loop Mortgage filed a petition for tax deed, and notified Smith, Cummings and Lee, among others, that the redemption period would expire on April 1, 1995.

Agnes Lee subsequently informed Smith that she was rescinding her contract to sell 4446 S. Greenwood and executed a contract for the sale of the property to Murray Williams. Lee gave Williams power of attorney to act on her behalf, and Williams redeemed the property before the redemption period expired. Loop Mortgage filed a petition in the circuit court to expunge the redemption, arguing Williams had no redeemable interest in the property because Lee, his principal, had conveyed a warranty deed to Smith which extinguished her interest in the property. The trial court agreed and expunged the redemption.

Williams appealed, and the appellate court reversed. 294 Ill. App. 3d 557. The appellate court, relying primarily on this court's decision in Weiner v. Jobst, 22 Ill. 2d 11 (1961), held that the owner of record title, even if she has neither equitable nor legal title to the property, has a right to redeem the property from a tax sale under section 21-345 of the Property Tax Code. 294 Ill. App. 3d at 561.

ANALYSIS

Both the Illinois Constitution and the Property Tax Code contain provisions regarding the right to redeem property sold at a tax sale. Article IX, section 8(b), of the Illinois Constitution provides, "The right of redemption from all sales of real estate for the nonpayment of taxes or special assessments *** shall exist in favor of owners and persons interested in such real estate for not less than 2 years following such sales." (Emphasis added.) Ill. Const. 1970, art. IX, §8(b). Similarly, section 21-345 of the Property Tax Code provides: "A right to redeem property from any sale under this Code shall exist in any owner or person interested in that property, other than an undisclosed beneficiary of an Illinois land trust, whether or not the interest in the property sold is recorded or filed. Any redemption shall be presumed to have been made by or on behalf of the owners and persons interested in the property and shall inure to the benefit of the persons having the legal or equitable title to the property redeemed, subject to the right of the person making the redemption to be reimbursed by the persons benefited. No redemption shall be held invalid by reason of the failure of the person redeeming to have recorded or filed the document evidencing an interest in the property prior to redemption, other than an undisclosed beneficiary of an Illinois land trust." (Emphasis added.) 35 ILCS 200/21-345 (West 1996).

Whether a party who has record title, but not legal or equitable title, to a property sold at a tax sale has a right to redeem under section 21-345 of the Property Tax Code is a question of statutory interpretation, which this court reviews de novo. See Lucas v. Lakin, 175 Ill. 2d 166, 171 (1997).

The law favors redemptions, and the redemption statute will be liberally construed unless injury to the tax purchaser results. Franzen v. Donichy, 9 Ill. 2d 382, 387 (1956). The tax purchaser's mere failure to procure a tax deed, however, does not preclude liberal construction of the redemption statute because the tax purchaser recovers the amount it paid for the tax certificate upon redemption. In re Application of Du Page County Collector, 98 Ill. App. 3d 950, 952 (1981). A complete stranger to the property has no right to redeem, but neither section 21-345 of the Property Tax Code nor article IX, section 8(b), of the Illinois Constitution requires complete legal title in order to redeem. Franzen, 9 Ill. 2d at 387 (contract to convey property creates a redeemable equitable interest in property); People v. Hess, 7 Ill. 2d 192, 199 (1955) (equitable owner of shares of a dissolved corporation has right to redeem property owned by corporation). A party seeking to redeem a property sold at a tax sale need only have an " `undefined' interest" in the property. Hess, 7 Ill. 2d at 197. A party asserting a right to redeem under section 21-345 of the Code must have some interest, however incomplete or undefined, in the property, but an interest nonetheless.

Loop Mortgage argues Williams has no right to redeem the property on Lee's behalf because Lee conveyed a warranty deed to Smith which extinguished all of her interest in the property. We agree. A warranty deed conveys a fee simple estate to the grantee. Urbaitis v. Commonwealth Edison, 143 Ill. 2d 458, 468 (1991); 765 ILCS 5/9 (West 1996). The grantee's failure to record the deed does not affect the deed's operation as a conveyance. Lucas v. Westray, 408 Ill. 243, 248 (1951). The deed is effective upon delivery. Lucas, 408 Ill. at 248. It is axiomatic that the grantor of a valid warranty deed cannot defeat the grantee's title to the property based on the grantee's failure to record. Gibson v. Brown, 214 Ill. 330, 337-38 (1905) (grantee's failure to record deed does not divest grantee of title). The grantee's failure to record the deed may affect the grantee's rights vis-a-vis a third party who purchases the property without notice of the grantee's unrecorded interest (see 765 ILCS 5/30 (West 1996)), but the grantee's failure to record does not resuscitate the grantor's interest in the property.

Williams cites Weiner v. Jobst, 22 Ill. 2d 11 (1961), for the proposition that the owner of record title alone has a sufficient interest in the property to redeem. Williams' reliance on Weiner is misplaced. In Weiner, the agent of the legal owner attempted to redeem the property, but the court held that the legal owner could not redeem because one of the deeds in its chain of title had not been recorded. "[A] stranger to the record title," the Weiner court concluded, "has no right to redeem." Weiner, 22 Ill. 2d at 15. The General Assembly subsequently passed an amendment to the Code which eliminated Weiner's requirement that a party seeking to redeem must have a recorded interest in the property. Ill. Rev. Stat. 1973, ch. 120, par. 734 (now codified, as amended, at 35 ILCS 200/21-345 (West 1996)).

Williams argues the amendment to the redemption statute did not repudiate the implication in Weiner that owners of record could redeem even without legal or equitable title to the property. Nothing in Weiner, however, implies an owner of record, even if she does not have legal or equitable title to the property, has a right to redeem. The Weiner court, even though it held the owner of legal title could not redeem unless its interest in the property was recorded, did not identify who, if anyone, could redeem the property. In fact, the Dissent in Weiner noted the effect of the majority's holding was no one could redeem the property because "[o]f course the grantor [of the] unrecorded deed could not redeem, for it had no interest in the ...


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