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In re Application of The County Collector of Lake County

October 02, 2003


Appeal from the Circuit Court of Lake County. Nos. 01--TD--212 98--TX--11 Honorable Michael J. Fritz, Judge, Presiding.

The opinion of the court was delivered by: Presiding Justice Hutchinson


Petitioners, Kevin Bloom and Steven Levin, appeal from the trial court's order dismissing with prejudice their petition for indemnity pursuant to section 21--305 of the Property Tax Code (35 ILCS 200/21--305 (West 2002)). They also appeal from the court's order denying their motion to reconsider. We affirm the order of dismissal, but reverse the order denying the motion to reconsider to the extent that it did not modify the dismissal with prejudice.

On March 28, 2002, petitioners filed a petition for indemnification from the fund (the fund) held by respondent, the Lake County treasurer, which exists to indemnify qualified persons who have lost properties due to issuance of a tax deed. The petition contained the allegations that follow. Bloom was the owner of record of the property at 34 S. Elmwood Avenue, Waukegan (the property), from "before 1996 through February 28, 2002." Levin was a co-owner of the property by virtue of a deed made by Bloom at some unidentified time before December 6, 2001. Levin was a "veteran of the Vietnam conflict and a decorated and distinguished soldier with two medals of valor and two purple hearts [who] suffer[ed] from significant disabilities as a result of gun shot wounds to his right arm and leg during his service." His disabilities "sometimes hampered [him] in his ability to attend to these matters."

Petitioners paid all property taxes due for the property through December 1997, but made no payments after that date until December 6, 2001, when they attempted to redeem the property. ML Agents purchased the delinquent taxes for all years in question. The period for redemption of the sold taxes expired on December 6, 2001. On that date, petitioners arranged to have a cashier's check for $13,000 sent by certified mail to the Lake County collector. Petitioners believed that the mailing of this check sufficed to preserve their interest in the property, although they now concede that it was mailed a day too late for compliance with redemption requirements. Their belief was the result of their reliance on the language in the notice they received that stated that " 'Redemption can be made any time on or before December 6, 2001***.' " (Emphasis added.) On February 28, 2002, the trial court, over petitioners' objections, issued a tax deed for the property to ML Agents. This, and other circumstances, precluded them from seeking relief from the issuance of the tax deed.

Respondent moved for dismissal of the petition pursuant to section 2--615 of the Code of Civil Procedure (the Code) (735 ILCS 5/2--615 (West 2002)). He alleged that the petition was defective in that it failed to plead that the property contained four or fewer units. The motion also contained a listing of other allegations petitioners did not plead. For instance, it stated that the petition did not allege that $13,000 would have been sufficient to make the redemption. It also noted that petitioners' exhibit A shows that the check by which they attempted the redemption was payable to "Lake County Collector" and was issued to "Gerry Goldman," but that the petition neither refers directly to Goldman nor explains his role. The motion further argued that petitioners' attempted mode of redemption was "negligent and at fault as a matter of law," because the law governing redemption states that a payment is timely only if it either is delivered in person or is mailed no later than one day before the expiration of the redemption period. The motion argued that petitioners' belief that their redemption method was proper was "incredible" because the notice sent to them states that a person can redeem a property "by applying to the County Clerk of Lake County, Illinois, at the County Courthouse in Waukegan, Illinois."

Finally, the motion argued that petitioners had failed to allege facts showing that they were equitably entitled to relief; nothing in the petition explained why Levin had taken no action before the redemption date, other than a general allegation that Levin had disabilities that "sometimes hampered [him] in his ability to attend to these matters." It further pointed out that the petition provided no explanation of why Bloom was unable to attend to the taxes. It cited McClandon v. Rosewell, 299 Ill. App. 3d 563 (1998), for the proposition that the legislature did not design the fund to compensate property owners who have "contribute[d] to the loss of their property." It then claimed that to compensate petitioners would amount to "tacit approval of conduct which is naive and fiscally irresponsible," which would be contrary to the requirement of In re Application of Kane County Collector, 135 Ill. App. 3d 796 (1985).

In their brief on respondent's motion, petitioners argued that respondent was urging the wrong standard upon the trial court, but also alleged their ability to amend the petition to address some flaws cited by respondent. The trial court heard oral argument on the motion, granted it, and made the dismissal with prejudice. The order of dismissal stated that "[p]etitioners have failed to allege facts that would rise to the level of relief [sic] under the Indemnity Fund if proven, and amendment would not cure [the] defects found."

Petitioners moved to reconsider the dismissal. The motion alleged that, at oral argument on the motion to dismiss, the trial court was concerned with whether the property had four or fewer units and whether petitioners had tendered funds sufficient to redeem the property. It stated that petitioners could prove that the property contained a single-family house and that the check tendered was for more than the taxes due. It further alleged that "the Court's primary concern at the time of the hearing was the question regarding the mental and physical condition of Co-Petitioner, KEVIN BLOOM, it having been established that Co-Petitioner, STEVEN LEVIN, was suffering from mental and physical disabilities. For that reason, the Court dismissed the Petition with prejudice and did not permit the Petitioners an opportunity to amend." Finally, the motion alleged that "[s]ubseqent to the hearing, Counsel for the Petitioners has learned that KEVIN BLOOM suffers from recognized disabilities such that he, KEVIN BLOOM, is unable to handle matters such as paying a tax bill and requires STEVEN LEVIN, whose disabilities are not as severe as those suffered by KEVIN BLOOM, to be the only person among the Petitioners capable of handling such matters."

Petitioners argued that, under Hedrick v. Bathon, 319 Ill. App. 3d 599 (2001), their disabilities could establish their equitable claim for indemnity. They further argued that the trial court had apparently engaged in a premature weighing of the facts regarding their disabilities, and that the trial court had determined that petitioners were at fault, a matter that is not a necessary consideration when the award requested is less than $99,000.

Both parties filed briefs, and, after argument, the trial court denied petitioners' motion. The order states that the denial is "based on the Court's weighing of the equities and finding that the dismissal was proper." No transcript or other record of this hearing is part of the record on appeal. Petitioners now appeal, arguing, inter alia, that the trial court improperly considered the fault of petitioners, that fairness requires that petitioners have the chance to amend the petition, and that the trial court engaged in an improper "weighing of [the] facts" in ruling on the motion to dismiss and the motion to reconsider.

We first consider whether the trial court properly granted the original motion to dismiss. A trial court should grant a motion to dismiss a complaint under section 2--615 of the Code only when the allegations in the complaint, construed in the light most favorable to the plaintiff, fail to state a cause of action upon which relief can be granted. Oliveira v. Amoco Oil Co., 201 Ill. 2d 134, 147 (2002). It should accept all well-pleaded facts and inferences drawn from those facts as true. Oliveira, 201 Ill. 2d at 147. We review a dismissal under section 2--615 de novo. Oliveira, 201 Ill. 2d at 147-48.

Indemnity under section 21--305 of the Property Tax Code is potentially available to "[a]ny owner of property sold under any provision of this Code who sustains loss or damage by reason of the issuance of a tax deed under Section 21--445 or 22--40 [(35 ILCS 200/21--445, 22--40 (West 2002))] and who is barred or is in any way precluded from bringing an action for the recovery of the property." 35 ILCS 200/21--305 (West 2002). If a petitioner can meet this basic qualification, he or she can qualify for indemnity in either of two ways. Under the first, which we will call the "equitable entitlement provision," if the petitioner is seeking an award of less than $99,000, he or she needs to prove (1) that he or she resided in the property on the last day of the period of redemption, (2) that it contained four or fewer "dwelling units," and (3) that he or she is "equitably entitled to compensation for the loss or damage." 35 ILCS 200/21--305(a)(1) (West 2002). Under the second, which we will call the "without fault provision," if he or she seeks more than $99,000, he or she must show that he or she is "without fault or negligence of his or her own." 35 ILCS 200/21--305(a)(2) (West 2002). When determining whether the petitioner was negligent or at fault, "the court shall consider whether the owner exercised ordinary reasonable diligence under all of the relevant circumstances." 35 ILCS 200/21--305(a)(2) (West 2002).

Clearly, petitioners in this case did not set forth the necessary allegations to establish eligibility for relief under the equitable entitlement provisions; they pleaded neither that they lived in the property nor that it had four or fewer dwelling units. Further, petitioners failed to provide sufficient detail as to the nature of their claimed equitable entitlement. It appears that in the only reported cases under section 21--305 in which the trial court refused indemnity to the petitioners without a hearing, the decisions were reversed on appeal (Van Dahm v. Novak, 174 Ill. App. 3d 880 (1988) (summary judgment); Mason v. Rosewell, 107 Ill. App. 3d 943 (1982) (failure to state a ...

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