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Mulry v. Berrios

Court of Appeals of Illinois, First District, Fourth Division

March 16, 2017

BARBARA R. MULRY, Plaintiff-Appellant,

         Appeal from the Circuit Court of Cook County, 14-COAC-000004 Honorable Sharon M. Sullivan, Judge Presiding.

          JUSTICE McBRIDE delivered the judgment of the court, with opinion. Presiding Justice Ellis and Justice Burke concurred in the judgment and opinion.



         ¶ 1 In 2013, the General Assembly adopted the "Erroneous homestead exemptions" section of the Property Tax Code (Code) (35 ILCS 200/1-1 et seq. (West 2014)), setting out procedures for the Cook County Assessor's Office, once it has discovered that a property owner has been erroneously granted a homestead exemption, to recoup unpaid taxes and 10% annual interest and impose 50% penalties and liens. See Pub. Act 98-93, § 5 (eff. July 16, 2013) (adding 35 ILCS 200/9-275). A homestead is a property taxpayer's primary residence and the legislature has granted limited homestead exemptions from taxation to certain groups, such as military veterans, senior citizens, and long term occupants. See 35 ILCS 200/9-275(a) (West 2014). The main question presented by Evergreen Park property owner Barbara R. Mulry is whether the statute adopted in 2013 encompasses tax years 2010, 2011, and 2012. Mulry contends the statute has been applied retroactively in violation of the contract clause and due process guarantee of the state and federal constitutions and that an administrative hearing officer's decision in favor of tax assessment and 10% interest is primarily based on computer records admitted into evidence without adequate foundation.

         ¶ 2 In 2014, the Cook County Assessor's Office notified taxpayer Mulry that she was not eligible to take homestead exemptions for tax years 2010, 2011, and 2012 for 9135 South Springfield Avenue, Evergreen Park, Illinois, 60805-1459. The notice indicated Mulry was liable for unpaid taxes and annual interest and that her property was subject to a lien. The notice specified that Mulry owed $4188.60, consisting of $1876.80 principal and $563.04 interest for tax year 2010, $664.20 principal and $132.84 interest for tax year 2011, and $865.20 principal and $86.52 interest for tax year 2012. Mulry sought an administrative hearing to contest the allegations of erroneous homestead exemptions, and the matter proceeded to hearing on May 15, 2014.

         ¶ 3 At the hearing, Mulry objected to the admission into evidence of computer printouts showing that she received a homestead exemption for two different Illinois properties for the three tax years at issue. After a brief continuance, the Assistant State's Attorney called Joseph Accardi, an employee of the Cook County Assessor's Office, to testify. Accardi testified that during the course of his investigation into Mulry's exemptions, he printed records from the assessor's database, that the printed records proffered in the courtroom were kept in the normal course of business at the Assessor's Office, and that he had accessed them from the assessor's computer system by logging in as an individual and then entering the PIN numbers for both properties. Mulry objected to the sufficiency of this foundation, but the hearing officer overruled the objection. Accardi then testified that the documents showed exemptions had been taken for both properties for the three tax years at issue. Mulry waived cross-examination. The assistant State's attorney moved to admit the documents into evidence, and, over Mulry's objection, the hearing officer admitted these documents, as well as others.

         ¶ 4 Mulry testified that she and her husband, Timothy P. Mulry, have owned and resided for more than 30 years at 9139 South Springfield Avenue, Evergreen Park, Illinois, 60805-1459, which is next door to the property now at issue. Mulry inherited the subject property, 9135 South Springfield Avenue, from her widowed uncle, James Leo Brogan, who passed away on September 23, 2001. She has never resided in her uncle's former house and has rented it out more or less continuously since her inheritance. Until she received the Assessor's notice in 2014, she was unaware her uncle had a general homestead exemption in effect for his property. Since her inheritance, she has not looked at any tax bills and has merely signed checks that her husband has prepared to pay the tax bills. Her husband has also prepared checks to pay the taxes on their residence. Mulry tendered into evidence documents substantiating her uncle's death and her inheritance of the property title.

         ¶ 5 The assistant State's Attorney then argued the proceedings established that Mulry took simultaneous exemptions for the two properties and that the law entitled her to an exemption only for her primary residence. Mulry's attorney countered that the erroneous homeowner's exemption statute was being improperly applied. The hearing officer rejected Mulry's statutory argument, found that the preponderance of the evidence was in favor of the State of Illinois, and ruled that Mulry owed $4188.60.

         ¶ 6 Mulry sought review in the circuit court of Cook County, and when those proceedings also concluded in the State's favor, she sought this further review in the appellate court.

         ¶ 7 When a party appeals from the circuit court's decision on a complaint for administrative review, we review the decision of the administrative agency rather than the decision of the circuit court. White v. Retirement Board of Policemen's Annuity & Benefit Fund, 2014 IL App (1st) 132315, ¶ 23, 18 N.E.3d 92. The Administrative Review Law provides that our review of an administrative agency decision shall extend to all questions of law and fact presented by the record. 735 ILCS 5/3-110 (West 2014); White, 2014 IL App (1st) 132315, ¶ 23, 18 N.E.3d 92.

         ¶ 8 Mulry first argues that the hearing officer's decision is erroneous because it gives impermissible retroactive application to the statute. She contends that the claimed tax arrears for tax years 2010 through 2012 are all prior to section 9-275's effective date of July 16, 2013 (Pub. Act 98-93, § 5 (eff. July 16, 2013)), and there is no language in the statute indicating the General Assembly intended for the law to apply to conduct occurring before its enactment. Mulry contends her interpretation is supported by the fact that the Assessor's Office did not implement procedures for conducting section 9-275 hearings until February 26, 2014. The State's Attorney responds that Mulry misunderstands the significance of a statute's effective date and that, under the analysis set forth in numerous Illinois cases, it is permissible for the legislation to be applied as it was written.

         ¶ 9 Mulry's argument is one of statutory interpretation, which is a question of law we address de novo. White, 2014 IL App (1st) 132315, ¶ 23, 18 N.E.3d 92; Branson v. Department of Revenue, 168 Ill.2d 247, 254, 659 N.E.2d 961, 965 (1995). The fundamental rule of statutory construction is to determine and give effect to the intent of the legislature. People ex rel. Madigan v. Lincoln, Ltd., 383 Ill.App.3d 198, 205, 890 N.E.2d 975, 980 (2008). The language of a statute is the most reliable indication of the legislature's objectives in enacting the law. Lincoln, 383 Ill.App.3d at 205, 890 N.E.2d at 980-81. The language is to be given its plain and ordinary meaning, all provisions of an enactment are to be viewed as whole, and words and phrases are to be construed in light of relevant provisions of the statute rather than in isolation. Lincoln, 383 Ill.App.3d at 205, 890 N.E.2d at 980-81. In addition, whenever possible, every word, clause, and sentence is to be given reasonable meaning and shall not be treated as superfluous or rendered void. Lincoln, 383 Ill.App.3d at 205, 890 N.E.2d at 980-81.

         ¶ 10 In our opinion, Mulry misconstrues the significance of a statute's effective date, which is simply the date that legislation takes effect or, in other words, becomes governing law. A statute's effective date is not enough to tell us about the General Assembly's intended temporal reach of this enactment. The " 'traditional rule' " is that statutes do not apply retroactively unless the legislators have expressly stated this temporal reach. Commonwealth Edison Co. v. Will County Collector, 196 Ill.2d 27, 37, 749 N.E.2d 964, 971 (2001) (quoting Plaut v. Spendthrift Farm, Inc., 514 U.S. 211, 237 (1995)). A statute that has retroactive impact is one that " 'would impair rights a party possessed when he acted, increase a party's liability for past conduct, or imposes new duties with respect to transactions already completed.' " Commonwealth Edison, 196 Ill.2d at 38, 749 N.E.2d at 971 (quoting Landgraf v. USI Film Products, 511 U.S. 244, 280 (1994)). The presumption against statutory retroactivity is based on concerns for unfairly affecting property and contract rights. Commonwealth Edison, 196 Ill.2d at 37-38, 749 N.E.2d at 971. Accordingly, courts require the legislature to clearly indicate its intent for retroactive application and, thus, signal that it has considered the potential unfairness and yet determined that retroactive application " 'is an acceptable price to pay for the countervailing benefits.' " Commonwealth Edison, 196 Ill.2d at 37-38, 749 N.E.2d at 971 (quoting Landgraf, 511 U.S. at 272-73). Illinois courts follow the retroactivity analysis set out by the United States Supreme Court in Landgraf, 511 U.S. 244. Commonwealth Edison, 196 Ill.2d at 39, 749 N.E.2d at 972. Under Landgraf, the first question is whether the legislature has clearly indicated the statute's temporal reach. Commonwealth Edison, 196 Ill.2d at 38, 749 N.E.2d at 971. If so, then, absent a constitutional prohibition, that expression of legislative intent must be given effect. Commonwealth Edison, 196 Ill.2d at 38, 749 N.E.2d at 971.

         ¶ 11 In order to apply Landgraf and to adhere to the principles of sound interpretation, we must consider all the relevant language of the statute, rather than merely the date the legislation became effective, as Mulry argues. The statute as a whole created specific procedures through which the chief county assessment officer may recover an unlawfully received tax benefit. Paragraph (a) defines certain terms used in the statute. 35 ILCS 200/9-275(a) (West 2014). Paragraph (b) details the information the chief county assessment officer must include in each assessment notice sent in a general assessment year and indicates that a property owner will not be penalized if, within 60 days after receiving the notice, he or she notifies the officer of the receipt of a homestead exemption in error in a previous assessment year and pays the principal amount of back taxes. 35 ILCS 200/9-275(b) (West 2014). The next five paragraphs of the statute-paragraphs (c), (c-5), (d), (e), and (f)-describe how the chief county assessment officer is to proceed upon realizing that "one or more erroneous homestead exemptions was applied to the property, " indicate that the taxpayer may request a hearing of the allegations, set out procedural rules for the taxpayer's request and the hearing, and provide for appeals consistent with the Administrative Review Law. 35 ILCS 200/9-275(c), (c-5), (d), (e), (f) (West 2014). The next five ...

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