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Ajax Financial v. State of Illinois CMS

December 29, 2000

IN RE APPLICATION OF THE COUNTY COLLECTOR FOR JUDGMENT AND ORDER OF SALE AGAINST LAND AND LOTS RETURNED DELINQUENT FOR NONPAYMENT OF GENERAL TAXES FOR THE YEAR 1996 AND PRIOR YEARS
AJAX FINANCIAL, L.P.,
PLAINTIFF-APPELLEE
V.
THE STATE OF ILLINOIS CMS, ABN-AMRO INCORPORATED LEASING AND FINANCIAL SERVICES,
DEFENDANTS-APPELLANTS.



Appeal from the Circuit Court of Cook County No. 98 CoTD 2381 The Honorable Marjan P. Staniec, Judge Presiding.

The opinion of the court was delivered by: Justice Cousins

Tax purchaser Ajax Financial, L.P. (Ajax) brought a petition to expunge redemption against property owner ABN-AMRO Incorporated Leasing and Financial Services (ABN). Specifically, Ajax argued that ABN paid delinquent property taxes after the extended period of redemption had expired. On June 23, 1999, the trial court granted Ajax's motion for summary judgment on its petition to expunge redemption. On June 29, 1999, the trial court further entered an order directing the county clerk to issue a tax deed for the contested property in favor of the tax purchaser, Ajax.

ABN now appeals, arguing that: (1) Ajax waived its right to contest ABN's redemption of the taxes because an Ajax agent authorized late redemption after the period of redemption had already expired; and (2) ABN is entitled to an equitable redemption because it attempted to redeem its property in good faith and was frustrated through no fault of its own.

BACKGROUND

On February 27, 1998, Ajax purchased delinquent real property taxes for parcel No. 16-35-403-043-0000 located in Cook County for the 1996 tax year. The property owner was ABN. The parcel consists of a portion of a commercial warehouse leased to the State of Illinois. A certificate of purchase dated March 11, 1998, issued by the county clerk for Cook County, states that Ajax's tax purchase also included $3,352.03 of unpaid taxes for 1992. Since ABN owed two years of back taxes for the years 1992 and 1996, the original period of redemption expired six months from the date of sale, on August 27, 1998. However, ABN now alleges that Cook County records indicate that the 1992 taxes were overpaid by ABN, such that it appears that only one year's taxes had been in arrears. According to ABN, the original period of redemption should have expired two years from the date of sale on February 28, 2000.

In any event, Ajax extended the period of redemption on two occasions, the last extension expiring on January 27, 1999. On September 16, 1998, Ajax filed its petition for tax deed with the clerk of Cook County. On October 27, 1998, ABN obtained an estimate of redemption from the Cook County clerk (County).

On January 13, 1999, ABN paid $34,216.70 to the County based upon the County's October estimate of redemption. On January 14, 1999, the County recomputed the cost of redemption and determined that the funds tendered by ABN were insufficient. The County attempted to inform ABN of the shortfall by sending a letter properly addressed to:

"State of Illinois CMS c/o ABN AMRO Inc. Leasing and Financial Services

208 S. LaSalle St. 208-400

Chicago, IL 60604."

However, on February 2, 1999, six days after the expiration of the period of redemption, the United States Postal Service returned the letter to the County, stating that the addressee was "unknown."

The County then contacted ABN by telephone, informing ABN that it would be unable to accept the outstanding balance without the tax buyer's consent, because the period of redemption had already expired. ABN contacted an Ajax agent in California and obtained the agent's consent to the late redemption. The Ajax agent wrote the following letter, dated February 4, 1999, to Fredda Berman of the Cook County collector's office:

"We authorize the Cook County Collector's Office to accept payment after January 27 for the redemption of parcel # 16-35-403-043-0000. Please call me if you have any ...


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