Opinion ID: 2085707
Heading Depth: 1
Heading Rank: 2

Heading: facts

Text: In 1977, Mary Lowe purchased a single-family home located at 13250 South Riverdale in Chicago. In 1993, Lowe quitclaimed the property to herself and William Austin. Austin died in 1994. Property taxes were paid on the home until 1992, when $110.65 in assessed taxes for the 1991 property tax year went unpaid. Once property taxes become delinquent, the Property Tax Code (the Code) (35 ILCS 200/1-1 et seq. (West 1994)) provides that the county collector may file an application in the circuit court for judgment and order of sale of the delinquent property. The Code directs that the county collector shall publish notice of its intent to file an application for judgment. 35 ILCS 200/21-110 (West 1994). The notice must be published in a newspaper in the township where the property is located at least 10 days before the application is filed. 35 ILCS 200/21-115 (West 1994). In addition, the county collector shall send a notice of the application for judgment and sale, by certified or registered mail, to the person in whose name the taxes were last assessed at least 15 days before the date of the application for judgment and sale of the delinquent property. 35 ILCS 200/21-135 (West 1994). The county collector must present proof of the mailing to the court along with the application for judgment. 35 ILCS 200/21-135 (West 1994). The property owner can pay the delinquent taxes and costs anytime prior to the sale. 35 ILCS 200/21-165 (West 1994). If judgment is entered against the property, the county collector shall offer the property for sale pursuant to the judgment. 35 ILCS 200/21-190 (West 1994). Following a tax sale, the Code provides that, in order to seek a tax deed, the tax purchaser must deliver a notice to the county clerk to be given to the party in whose name the taxes were last assessed. 35 ILCS 200/22-5 (West 1994). This notice must be delivered to the county clerk within five months after the tax sale, and the county clerk must mail the notice, within 10 days of receipt, by registered or certified mail. 35 ILCS 200/22-5 (West 1994). This section 22-5 Take Notice advises a party that his property has been sold for delinquent taxes, that redemption can be made until a specified date, and that a petition for tax deed will be filed by the tax purchaser if redemption is not made. 35 ILCS 200/22-5 (West 1994). The Code provides for a second Take Notice to be sent to the owners, occupants and parties interested in the delinquent property not less than three months or more than five months prior to the expiration of the period of redemption. 35 ILCS 200/22-10 (West 1994). This section 22-10 take notice must give notice of the sale and the date of expiration of the period of redemption. 35 ILCS 200/22-10 (West 1994). The section 22-10 take notice must be served: personally by the sheriff; by registered or certified mail, return receipt requested; and by three publications in a newspaper. 35 ILCS 200/22-15, 22-20, 22-25 (West 1994). Also within 5 months but not less than 3 months prior to the expiration of the redemption period, the tax purchaser may file a petition in the circuit court seeking an order directing the county clerk to issue a tax deed to the property. See 35 ILCS 200/22-30 (West 1994). In order to receive an order issuing a tax deed, the redemption period must expire without any redemption taking place, and the tax purchaser must prove to the circuit court that it has strictly complied with the statutory notice provisions set forth in sections 22-10 through 22-25 of the Code (35 ILCS 200/22-10 through 22-25 (West 1994)). 35 ILCS 200/22-30 (West 1994). In this case, the circuit court granted the collector's application for judgment and sale. The county collector offered Lowe's home for sale and, on March 3, 1993, Apex Tax Investments, Inc. (Apex), purchased the home at the annual Cook County tax sale for $347.61, the amount of the 1991 tax delinquency and fees. Apex did not receive title to the property at that time, but instead received a certificate of purchase. See 35 ILCS 200/21-250 (West 1994). The certificate of purchase did not affect Lowe's legal or equitable title to the property. In addition, Lowe had the right to redeem the property, upon payment of the tax arrearage and costs, until the redemption period expired. See 35 ILCS 200/21-345 through 21-355 (West 1994). On October 5, 1995, Apex filed a petition in the circuit court of Cook County for a tax deed to the property. Apex's tax petition stated that the redemption period expired by extension on February 21, 1996. Because no redemption occurred by February 21, 1996, Apex's petition proceeded to an ex parte hearing on March 18, 1996. At the March 18, 1996, hearing, Apex's attorney testified concerning Apex's compliance with the statutory notice provisions of sections 22-10 through 22-25 of the Code. Apex conducted a tract search and learned that the property at issue was owned by Mary Lowe and William Austin. Apex conveyed this information to the Cook County sheriff and the clerk of the circuit court of Cook County. Pursuant to section 22-15 of the Code (35 ILCS 200/22-15 (West 1994)), the Cook County sheriff attempted to personally serve Lowe, Austin and occupant with the section 22-10 take notice on October 26, 1995. The Cook County sheriff filed the returns of service for the section 22-10 take notices with the clerk of the circuit court on November 9, 1995. On each return of service, the deputy sheriff wrote House vacant per neighbors. In addition, the deputy sheriff wrote the word MOVED on the preprinted form to indicate the reason why notice was not served. Because the Cook County sheriff could not effect personal service on Austin, Lowe or occupant, the sheriff also sent section 22-10 take notices to Austin, Lowe and occupant at the property's address by certified mail, return receipt requested. The three certified mail notices were returned to the sheriff undelivered, and were filed with the clerk of the circuit court. The envelopes for the three certified mail notices were admitted into evidence at the hearing on Apex's petition for a tax deed. All three envelopes were postmarked November 8, 1995, and were stamped return to sender. On the envelope addressed to Austin, the word deceased was handwritten in pencil on the left side of the envelope. The envelopes addressed to Lowe and occupant contained stamps indicating that attempts were made to deliver the notices on November 16, December 11, and December 18, 1995. In addition, the two envelopes addressed to Lowe and occupant contained a handwritten notation written vertically on the left side of the envelope which read, Person is Hospitalized. Under that notation, the number 2719 and the letters JHT were handwritten. The handwritten notations on the envelopes have a line drawn through them and are obscured in part by the circuit court clerk's filing stamp and the post office's return to sender stamps. The sheriff filed the returned certified mail notice for Austin with the court on November 22, 1995, and filed the returned certified mail notices for Lowe and occupant with the court on January 2, 1996. Pursuant to statute, the clerk of the circuit court of Cook County also sent section 22-10 take notices by certified mail to Lowe, Austin and occupant. These notices were returned undelivered. The three certified mail envelopes were postmarked November 8, 1995, and were stamped return to sender. The three envelopes contained notations indicating that attempts were made to deliver the notices on November 9, November 15, and November 24, 1995. Apex also provided publication notice to Lowe and Austin by publishing notice in the Chicago Daily Law Bulletin on October 11, October 12, and October 13, 1995. At the hearing on Apex's petition for tax deed, Apex's attorney testified that, in attempting to ascertain the whereabouts of Lowe and Austin, the Cook County sheriff personally served a section 22-10 take notice on the law firm that prepared the 1993 quitclaim deed on behalf of Lowe. The clerk of the circuit court also sent notice to the law firm by certified mail on November 8, 1995. Moreover, the First National Bank of Chicago, in its capacity as a mortgagee of the property, was personally served with a section 22-10 take notice on October 24, 1995. Likewise, the clerk of the circuit court sent notice by certified mail to the bank on November 8, 1995. Apex's agent, Fred Berke, testified at the hearing that he had visited the property and inspected it on behalf of Apex sometime between October 21 and December 21, 1995. When Berke arrived at the home, he knocked on the door and looked into the living room window. Berke did not see any furniture inside the home. In addition, Berke spoke to a next-door neighbor who told Berke that the owner of the property was the Lowes, but that no one was living there currently. Berke testified that the home appeared to be uninhabited. Apex's attorney also testified that Apex checked city and suburban phone directories and voter registration records, but was unable to develop any address for William Austin or Mary Lowe other than the subject property address. Apex's attorney stated that all regular efforts to locate Lowe and Austin had proven fruitless. At the close of the hearing on Apex's petition for tax deed, the circuit court found that no redemption had been made, that Apex had complied with the notice provisions of the Property Tax Code, and that Apex had exercised due diligence in attempting to locate Lowe and Austin. Consequently, on May 20, 1996, the circuit court directed the county clerk to issue Apex a tax deed to the property. The tax deed was issued on May 20, 1996. Subsequently, on December 6, 1996, Apex entered into an installment contract to sell the property to third-party John Herndon for $10,000. Herndon testified via deposition that the property was in substantial disrepair when he purchased it, describing the home as an abandoned building. Herndon invested more than $20,000 in material and labor in renovating the property, completing the renovations by early 1998. On September 5, 1997, two of Mary Lowe's sons, Bruce and Mario Lowe, filed a pro se petition for Restoration of Property Ownership in the circuit court of Cook County, stating that Mary Lowe had been in and out of various mental facilities for the past 30 years and that Lowe had been hospitalized in a mental-health facility from August 26, 1995, to December 17, 1996. The petition stated that Mary Lowe had been released to Bruce Lowe's custody and that Mary currently resided with Bruce in California. The pro se petition alleged that personal service on an incompetent person violates that person's right to due process. The petition therefore asked that the court reinstate Mary's full rights of ownership in the subject property. Based upon the allegation that Mary Lowe was mentally disabled, the circuit court on November 1997 appointed the Cook County public guardian to represent her. [1] The public guardian then filed a petition, and later an amended petition, pursuant to section 2-1401 of the Code of Civil Procedure (735 ILCS 5/2-1401 (West 1994)) and section 22-45 of the Code (35 ILCS 200/22-45 (West 1994)), seeking to have the tax deed that was issued to Apex set aside. The public guardian alleged the Mary Lowe suffered from schizophrenia and had been hospitalized at the Tinley Park Mental Health Center at the time the section 22-10 notices were sent to the property in November 1995. The public guardian also noted that two of the notices mailed by the Cook County sheriff were returned with the notation Person is hospitalized 2719 JHT written on the envelopes. The public guardian alleged that the notations were written by mail carrier Jewel Hightower. The number 2719 was Hightower's postal route number and the letters JHT were Hightower's initials. The public guardian contended that Apex failed to make diligent inquiry concerning the whereabouts of Mary Lowe because Apex never attempted to contact Hightower or the post office. An evidentiary hearing on the public guardian's amended petition to set aside the tax deed was held on February 20, 2002. The circuit court allowed Herndon to participate at the hearing because he had purchased the subject property. Dr. Bernard Rubin testified at the hearing that he had reviewed Lowe's mental-health records and concluded that Lowe had suffered from disorganized, chronic schizophrenic disorder. Rubin said that from January 1995 until October 1996, Lowe suffered from a mental illness, was generally incompetent, and would not have been able to understand or respond to legal documents served upon her between January 1995 and October 1996. Hightower also testified at the evidentiary hearing that she was a mail carrier for the United States Postal Service and that the property at issue was on her route. She wrote Person is Hospitalized on the certified letters sent by the sheriff to Lowe and occupant. Hightower also wrote her postal route number, 2719, and her initials, JHT, on the envelopes. At the time she made the notations on the envelopes, Hightower knew that Lowe was in Tinley Park Mental Health Center, but postal regulations did not allow her to note anything more specific than the fact that an addressee was hospitalized. Hightower testified that anyone wanting further information concerning Lowe's whereabouts could have come to the post office and filled out the proper forms, although Hightower did not further explain what forms would authorize disclosure that a person was hospitalized in a mental-health facility. On April 9, 2002, the circuit court denied the public guardian's amended petition to set aside the tax deed. The appellate court affirmed. No. 1-02-1101 (2003) (unpublished order under Supreme Court Rule 23). This court granted the public guardian's petition for leave to appeal and affirmed the circuit and appellate courts. In affirming, this court noted that relief from an order issuing a tax deed could be had under section 2-1401 of the Code of Civil Procedure (735 ILCS 5/2-1401 (West 1994)), but that the grounds for relief were limited as set forth in section 22-45 of the Code (35 ILCS 200/22-45 (West 1994)). In re Application of the County Collector, 217 Ill.2d at 25-26, 298 Ill.Dec. 14, 838 N.E.2d 907. These grounds are limited to: (1) proof that the taxes were paid prior to the sale; (2) proof that the property was exempt from taxation; (3) proof by clear and convincing evidence that the tax deed was procured by fraud or deception; or (4) proof by a person or party holding a recorded ownership or other interest in the property that he was not named as a party in the section 22-20 publication notice and that the tax purchaser did not make a diligent inquiry and effort to serve that person or party with the notices required pursuant to sections 22-10 through 22-30. 35 ILCS 200/22-45 (West 1994). The public guardian argued that the tax deed issued to Apex should be set aside because there was clear and convincing evidence that Apex had procured the tax deed by fraud or deception. In re Application of the County Collector, 217 Ill.2d at 26, 298 Ill.Dec. 14, 838 N.E.2d 907. The public guardian claimed that Apex's representation that it had been unable to ascertain Lowe's whereabouts despite having conducted a diligent search constituted fraud or deception in light of `Apex's willful ignorance with respect to the notations [from Hightower] on the undelivered envelopes.' In re Application of the County Collector, 217 Ill.2d at 23, 298 Ill. Dec. 14, 838 N.E.2d 907. This court rejected the public guardian's argument, noting that in the context of tax deed proceedings, fraud is defined as a wrongful intent or an act calculated to deceive. In re Application of the County Collector, 217 Ill.2d at 23, 298 Ill.Dec. 14, 838 N.E.2d 907. This court held that the record in the case did not show fraud. Specifically, this court found that: The envelopes with Jewel Hightower's notations on them were returned by the post office to their sender, the Cook County sheriff. The sheriff submitted the envelopes to the clerk of the circuit court, who then placed the envelopes in the court file, which, by statute, the clerk is required to maintain in tax deed cases. [Citation.] There was nothing unusual or unexpected about the fact that the envelopes were returned, undelivered. Both an agent from Apex and a deputy sheriff from the Cook County sheriff's office had visited the property, found it vacant, and had been told by neighbors that the occupants of the home had moved. Further, the notations on the envelopes addressed to Mary Lowe and `occupant,' though legible, cannot reasonably be called prominent. The notations have a line drawn through them and they are partially obscured by the circuit court clerk's filing stamps and the post office's `returned to sender' stamps. More important, there is no evidence that Apex attempted to conceal the notations or alter the envelopes in any way.    On this record, the most that can be said with respect to Apex's actions is that Apex simply failed to discover the notations on the envelopes. However, as this court has frequently noted, the failure to uncover a particular fact during the search for a delinquent taxpayer does not, by itself, establish fraud. In re Application of the County Collector, 217 Ill.2d at 23-24, 298 Ill.Dec. 14, 838 N.E.2d 907. This court also rejected the public guardian's claim that the tax deed should be set aside because Lowe had been denied her due process right to adequate notice prior to the deprivation of her property. This court concluded that the public guardian was attempting to relitigate the circuit court's diligent-inquiry findinga finding that could not be challenged in a section 2-1401 petition except on the grounds set forth in section 22-45 of the Code. In re Application of the County Collector, 217 Ill.2d at 37-38, 298 Ill.Dec. 14, 838 N.E.2d 907. Because this court had already concluded that fraud under section 22-45 had not been proven, this court declined to further consider the public guardian's argument that Apex failed to conduct a diligent inquiry to locate Lowe. In re Application of the County Collector, 217 Ill.2d at 38, 298 Ill.Dec. 14, 838 N.E.2d 907. Finally, this court rejected the public guardian's argument that the Code is unconstitutional as applied to all individuals like Lowe, who are hospitalized with a disabling mental illness during the section 22-10 notice period. In re Application of the County Collector, 217 Ill.2d at 38, 298 Ill.Dec. 14, 838 N.E.2d 907. We held that the notice procedures set forth in sections 22-10 through 22-25 of the Code embodied all that could be done under existing law to locate and identify a delinquent taxpayer who is hospitalized for mental illness. In re Application of the County Collector, 217 Ill.2d at 41-42, 298 Ill.Dec. 14, 838 N.E.2d 907. The United States Supreme Court subsequently granted the public guardian's petition for writ of certiorari, vacated the judgment of this court, and remanded the cause for our further consideration in light of Jones v. Flowers, 547 U.S. 220, 126 S.Ct. 1708, 164 L.Ed.2d 415 (2006). Estate of Lowe v. Apex Tax Investments, Inc., 547 U.S. ___, 126 S.Ct. 2287, 164 L.Ed.2d 811 (2006).