Court Opinion

ID: 9884340
Source: CourtListenerOpinion
Date Created: 2023-10-06 02:53:42.066989+00
Date Added: 2024-06-11T07:48:37.818408
License: Public Domain

JUSTICE "WARD delivered the opinion of the court: This appeal presents the question of the authority of the circuit court to withhold property that has been tax delinquent for five years or more from a sale under section 235a of the Revenue Act of 1939, which section is commonly known as the Scavenger Act (Ill. Rev. Stat. 1979, ch. 120, par. 716a). The circuit court of Cook County, upon the motion of the county treasurer and collector, Edward J. Rosewell, removed certain tax-delinquent parcels from a judgment and order of sale that had been applied for by him under the Scavenger Act. The ground for the motion was that civil actions for delinquent taxes had already been brought by the board of commissioners of Cook County against the owners of these parcels pursuant to section 275 of the Revenue Act (Ill. Rev. Stat. 1979, ch. 120, par. 756), and were pending. The appellate court, on an appeal filed by certain of the owners (the objectors), reversed the order removing the parcels from sale, holding that the Scavenger Act’s provisions for sale of property that has been tax delinquent for five years are mandatory. (101 Ill. App. 3d 498.) The collector petitioned for leave to appeal under Rule 315 and alternatively under Rule 317 on the ground that the appellate court’s decision raised for the first time a constitutional question regarding the separation of powers. The collector’s petition was allowed. 73 Ill. 2d Rules 315, 317. The collector filed the application for judgment and order of sale under the Scavenger Act on July 21, 1980. The application included all parcels upon which real estate taxes remained unpaid for each of five or more years. On August 8, 1980, the circuit court entered a judgment and order of sale. On August 27, 1980, the collector, at the request of his legal counsel, the State’s Attorney of Cook County, moved the court to amend its judgment so as to exclude from it the parcels whose owners had already been named in suits to collect delinquent real estate taxes. The objectors opposed the motion, but the court on September 24, 1980, amended its judgment and deleted the parcels. The court subsequently confirmed the sale of the remaining parcels. It denied objections to the confirmation of sale filed by the objectors, who argued that their parcels should have been included in the sale. The Revenue Act of 1939 (Ill. Rev. Stat. 1979, ch. 120, par. 482 et seq.) provides for proceedings against the delinquent taxpayer personally and also against the real property on which taxes are overdue. Section 27a (Ill. Rev. Stat. 1979, ch. 120, par. 508a) provides for personal liability for taxes, stating that an owner of real properly on January 1 “shall be liable for the taxes of that year.” Section 216 of the Revenue Act (Ill. Rev. Stat. 1979, ch. 120, par. 697), on the other hand, provides for an in rem claim. It declares that real property taxes shall be “a prior and first lien” on the property, “superior to all other liens and encumbrances,” from January 1 in the year in which the taxes are levied until they are paid or until the property is sold under the Revenue Act. Statutory means of enforcing these tax obligations have been enacted. Section 235 of the Revenue Act (Ill. Rev. Stat. 1979, ch. 120, par. 716) provides for an annual sale for the full amount of taxes owed on tracts on which taxes have not been paid in any one year. Tracts offered for sale under this but not sold are “forfeited” to the State. (Ill. Rev. Stat. 1979, ch. 120, par. 727.) (The statutory “forfeiture” does not, however, involve any claim by the State to title or possession. See Lawlor, Real Property Tax Delinquency and the Rehabilitation of Multi-Family Housing Stock in Chicago, Illinois: The Role of the Collection Provisions of the Elinois Revenue Act, 26 DePaul L. Rev. 1, 5 (1976).) Section 275 of the Revenue Act provides that the county may at any time bring a civil action in the name of the State against the property owner personally for taxes on property that has been “forfeited.” (Ill. Rev. Stat. 1979, ch. 120, par. 756.) Tbo, should the property remain tax delinquent for five years or more, the Revenue Act provides for a so-called scavenger sale, which is involved here. At the time of the sale here, the relevant section of the Scavenger Act provided: “[T]he County Collector annually *** shall in counties with a population of 2,000,000 or more, and shall in other counties if the county board by resolution so orders, *** publish an advertisement giving notice of the intended application for judgment for sale of all tracts of lands and lots upon which all or a part of the general taxes for each of 5 or more years are delinquent as of the date of the advertisement. *** The term delinquent also includes forfeitures. *** The County Collector shall make application for judgment for sale as provided in this Section and the Court shall give judgment for such general taxes, special taxes, special assessments, interest, penalties and costs as aré included in the advertisement and appear to be due thereon after allowing an opportunity to object and a hearing upon the objections as provided in Section 235 of this Act, that such lands and lots be sold by the County Collector at public sale to the highest bidder for cash, notwithstanding the bid may be less than the full amount of taxes, special taxes, special assessments, interest, penalties and costs for which judgment has been entered. Upon confirmation, a sale pursuant to this Section shall extinguish the lien of the general taxes, special taxes and special assessments for which judgment has been entered and shall extinguish all forfeitures therefor, and a redemption shall not revive the lien or the forfeiture. *** *** The remedy herein provided is in addition to other remedies for the collection of delinquent taxes. This Section shall be liberally construed so that the deeds herein provided for shall convey merchantable title.” (Emphasis added.) Ill. Rev. Stat. 1979, ch. 120, par. 716a. The collector contends that the appellate court erred in holding that under the provisions of the Scavenger Act the court must enter an unalterable judgment for the sale of every parcel that has been declared tax delinquent for five years or more. The collector points out that, apart from a court’s inherent judicial powers, a court, under the Act’s explicit provisions, has authority to consider objections to a judgment and sale and to conduct hearings, and, of course, there is authority to enter appropriate orders. He says that for good cause, such as for fraud or irregularity, the trial court is not compelled to order a sale. Nor is a court, where prior suits against delinquent taxpayers to collect overdue taxes in full are pending, required to order a sale which predictably will bring only a small fraction of the tax indebtedness and may also require dismissal of the pending suits. The construction of the Scavenger Act that the objectors seek, the collector argues, would contradict the language and purpose of the statute and would sanction an unconstitutional interference by the legislature with the judiciary’s authority to decide cases. The objectors, on the other hand, stress the legislature’s use of “shall” in providing that “the [c]ourt shall give judgment” for the taxes due and order a sale. They say that a mandatory construction is more in keeping with the apparent purpose of the Scavenger Act, to return tax-delinquent property to a status where it will generate revenue. The collector is correct in his contention that under the legislative intendment the circuit court had discretionary authority to withhold the parcels of the objectors from the sale. It will not be necessary to consider the collector’s additional contention that the appellate court’s holding has presented a constitutional question. “It is the established rule of this court that a constitutional question 'will not be considered if the case can be decided without doing so. [Citations.]” In re Estate of Ersch (1963), 29 Ill. 2d 572, 576-77. The fundamental of statutory construction is to ascertain and then give effect to the intent of the legislature. (People v. Robinson (1982), 89 Ill. 2d 469, 475; Town of City of Peoria v. O’Connor (1981), 85 Ill. 2d 195, 203.) Regarding the construction of provisions in statutes as being mandatory or directory, Sutherland on Statutory Construction states: “There is no universal rule by which directory provisions may, under all circumstances, be distinguished from those which are mandatory. The intention of the legislature, however, should be controlling and no formalistic rule of grammar or word form should stand in the way of carrying out the legislative intent. In the words of a court: ‘Consideration must be given to the legislative history, the language of the statute, its subject matter, the importance of its provisions, their relation to the general object intended to be accomplished by the act, and, finally, whether or not there is a public or private right involved.’ ” 1A A. Sutherland, Statutory Construction sec. 25.03 (4th ed. 1972), quoting from Wilcox v. Billings (1968), 200 Kan. 654, 657, 438 P.2d 108, 111. Sutherland also observes that “shall,” except when expressing futurity, indicates a mandatory intent. The intent, however, it is stated, is not to be understood as mandatory if “the context otherwise indicates.” (1A A. Sutherland, Statutory Construction sec. 25.04 (4th ed. 1972).) This court has recognized that while “shall” ordinarily suggests the mandatory, it may properly be construed in a directory sense to carry out what appears to be the intent of the legislature. In re Armour (1974), 59 Ill. 2d 102, 104 (the word “shall” does not have an exclusive, fixed or inviolate meaning); Cooper v. Hinrichs (1957), 10 Ill. 2d 269, 272 (the word “shall” can be construed as meaning “must” and “may” depending upon the legislative intent). The language of the provision in the Scavenger Act for the entry of a judgment and order of sale shows a legislative intent that the court was not to be without discretion and without the capacity to act judiciously. It provides for the entry of a judgment “after [the court’s] allowing an opportunity to object and a hearing upon the objections as provided in Section 235 of [the Revenue] Act ***.” Section 235 provides that the court shall consider the defenses of those against whom judgment may be entered and in a summary manner “pronounce judgment as the right of the case may be.” (Ill. Rev. Stat. 1979, ch. 120, par. 716.) The court was not to be required to enter judgment and an order of sale regardless of circumstances and regardless of whether the public interest would be served. The mandatory construction urged by the objectors is not reasonable. The civil actions against the property owners personally to satisfy the indebtedness for taxes are premised upon a “forfeiture.” As we have seen above, parcels offered at the annual sale but not sold are “forfeited” to the State, and section 275 of the Revenue Act authorizes a civil action against the owner of property that has been “forfeited.” (Ill. Rev. Stat. 1979, ch. 120, par. 756.) On confirmation of the sale following a scavenger sale, all tax liens and “forfeitures” are extinguished, notwithstanding the fact that the sale has been for less than the full amount of back taxes and notwithstanding that the sale may have been for a nominal amount. As quoted earlier in this opinion the statute reads: “[A] sale pursuant to this Section shall extinguish the lien of the general taxes, special taxes and special assessments for which judgment has been entered and shall extinguish all forfeitures therefor, and a redemption shall not revive the lien or the forfeiture. ” (Emphasis added.) (Between 1967 and 1973 in Cook County, 6,000 items of property were sold at scavenger sales; the average bid was only $143. (26 DePaul L. Rev. 1, 8 (1976).)) As the collector points out, the objectors are urging that we view the Scavenger Act as operating to abort, in effect, the civil actions brought under section 275. The welcome consequence for the objectors of doing so would be that under the Scavenger Act the tax liens and forfeitures would be extinguished and the property of the objectors given a clean bill of tax health. The objectors unreasonably ascribe to the legislature an intendment which would frustrate the public’s efforts to collect the full amount of taxes due and would encourage tax delinquents to stall actions against them until the time for a scavenger sale of their property is reached; i.e., after five years of nonpayment of taxes. (The relationship between tax delinquency and urban blight is discussed in J. Lawlor, Real Property Tax Delinquency and the Rehabilitation of Multi-Family Housing Stock in Chicago, Rlinois: The Role of the Collection Provisions of the Illinois Revenue Act, 26 DePaul L. Rev. 1 (1976).) The legislature, however, did not include in section 275 any limitation as to the time within which suit against the delinquent taxpayer must be brought. The civil action for the tax indebtedness may be brought “at any time.” (Ill. Rev. Stat. 1979, ch. 120, par. 756.) Moreover, that the Scavenger Act was not intended to frustrate the actions against the property owner is clearly expressed in the Act itself. The Act states: “The remedy herein provided is in addition to other remedies for the collection of delinquent taxes.” (Emphasis added.) Ill. Rev. Stat. 1979, ch. 120, par. 716a. The Scavenger Act is the legislature’s device of last resort. A principal object of it is to restore the property to a tax-revenue-producing status. (In re Application of Rosewell (1981), 93 Ill. App. 3d 1106, 1108.) It assumes that the other available methods of tax collection have been exhausted. The sale will be to the highest bidder, regardless of the amount of the tax delinquency. The action in debt procedure and the scavenger sale are remedial provisions. The former is intended to effect tax collections and to discourage the nonpayment of taxes. The scavenger sale is designed, as a last resort, to extinguish tax liens and forfeitures and to attempt to restore the property to a productive status. The two procedures must be read to complement and not to contradict each other. The legislature, realistically, did not intend that five or more years of overdue taxes would be satisfied by a bid of, say, $143 (26 DePaul L. Rev. 1 (1976)), if suits were pending to collect the entire amount of the overdue taxes plus interest. (The record does not disclose the tax indebtednesses of the tax objectors. It appears from the addresses that the properties, in the main, are in deteriorating areas of Chicago. Considering that the ownership is in trusts with numerous beneficiaries, it appears that the properties are multifamily houses.) The trial court did not violate what we perceive to be the legislative intent which would permit the county to continue its attempt to compel the tax delinquents to pay their taxes in full. The elimination of their properties from the sale simply gave the county the opportunity to protect its claims for the payment in full of the overdue taxes. As we have seen, if the concerned property had been sold the hen for taxes and forfeitures would have been extinguished and the pending actions against the tax delinquents might have been subjected to dismissal on that ground. Whether that result should have followed is, of course, not before us on this appeal. It seems clear, however, that dismissal of the actions would have been sought by some objectors had the parcels been sold at the scavenger sale. The appellate court opinion notes: “The stipulation between the parties above described states that one of the owners [objectors] intends to file a motion to dismiss the action in debt against him on the ground that the debt, if any, has been ‘extinguished by the Scavenger sale.’ ” Dismissal of the actions in debt would be another welcome consequence for the objectors. This is an additional reason for their complaint that their properties were removed from the scavenger sale. Though enacted too late to be of effect here, we point out that the legislature has acted to correct the very deficiencies in the Scavenger Act that we have shown and discussed here. Through an amendment (Pub. Act 82 — 987, 1982 Ill. Laws 2471, 2473) which its sponsor described as “very important in [Cook County’s] attempts to collect delinquent taxes” (82nd Gen. Assem., Legislative Day 127, June 23, 1982, at 229 (remarks of Sen. Netsch)), and which became effective September 9, 1982, the legislature removed from the Scavenger Act the provision that all forfeitures shall be extinguished upon confirmation of the sale. The amendment also provides that confirmation of a sale shall not affect the personal liability of the owner or prevent the maintaining of an action under section 275 for the collection of delinquent taxes. (1982 Ill. Laws 2471, 2473.) It seems not unlikely that this action by the legislature was taken in response to the appellate court opinion here. The content of the amendment shows that the legislature entertained the same views and concerns that we have expressed here, including the effect of the provision for the extinction of all forfeitures on actions brought for the collection of taxes under section 275. Earlier, in Public Act 81 — 1076 (1979 Ill. Laws 4091, 4092), the legislature amended the Act to provide: “No certificate of purchase [at a scavenger sale] shall be issued to any person who has not executed and delivered an affidavit to the County Clerk that such person has not bid upon any lot or tract of land at such sale who is the party or the agent of the party who is responsible for the payment of the delinquent taxes.” That amendment was effective July 1,1980. In the same amendment, Public Act 81 — 1076, the General Assembly wisely changed the provisions governing redemption following a scavenger sale. Prior to this amendment, the Act permitted an owner whose property was sold at a scavenger sale to redeem the property by paying only the amount for which the property was sold, together with interest. At a scavenger sale properties are sold to the highest bidder, and the amount of the bid need not be in the amount of the taxes owed. As a result, properties could be sold for only a small fraction of the amount of taxes owed; the Act, however, specifically provided that a redemption did not revive the lien and forfeitures extinguished by confirmation of the sale. (1979 Ill. Laws 4091, 4092.) (At the time of this amendment, the Act still provided that confirmation of a sale extinguished all forfeitures (1979 Ill. Laws 4091, 4092).) In the amendment (the language of which was later clarified in Public Act 82— 987, discussed above), the legislature provided that, except for single-family residential units, a tax-delinquent owner seeking to redeem from a scavenger sale must pay the amount of the delinquent taxes owed at the time of the sale, that is, he must satisfy the tax delinquency. 1979 Ill. Laws 4091, 4093. This shows a determination by the legislature to deal with the problem of the permitted evasion of taxes by owners of tax-delinquent property and of the unwitting fostering of urban blight by deficiencies in the Scavenger Act. The 1980 amendment to the Act obviously was designed by the legislature to end the incredibly permitted practice of allowing tax-delinquent owners to re-acquire their own property free of forfeitures and tax liens following a sale under the Scavenger Act without satisfying their tax indebtedness. The amendments should discourage the sacking of residential properties by owners who deliberately fail to pay taxes, make no repairs, provide only minimal maintenance, ignore building code violations, and then are allowed to re-acquire the property free from liens and maybe from personal liability for taxes. Senator Nedza, the sponsor in the Senate of the bill that became Public Act 81 — 1076, in urging its passage, told the Senate: “Under the present scavenger sale system, there are many blatant abuses by property owners to avoid paying their taxes. Moreover, it is costing the counties millions of dollars in lost revenue, not to mention the loss in the valuable housing.” He urged the Senate to “[close] the loop hole in the tax collection system which penalizes diligent taxpayers ***.” 81st Gen. Assem., Legislative Day 74, June 27,1979, at 163. Another senator, rising in support of the bill, stated: “[W]e were all painfully aware that this process . . . this procedure, does, in fact, exist. What happens is *** you will get a large apartment building in the ... the west side of Chicago, for instance and no taxes will have been paid year after year and after five years there is what’s called a scavenger sale and I or one of my friends can go in and buy the back taxes for a dollar or two dollars or two dollars and fifty cents when the taxes, in fact, may have been ten thousand or twelve thousand or fifteen thousand dollars and then I can absolve myself from tax liability by purchasing for two dollars and fifty cents plus interest the amount of that bid.” 81st Gen. Assem., 74th Legislative Day, June 27, 1979, at 163-64 (remarks of Sen. Rock). We observe, too, that Public Act 82 — 987 (which removed the provision that confirmation of a sale extinguishes all forfeitures) not only confirms our apprehension of the possible effect of confirmation of a sale on the actions for debt, but supports, too, our understanding of the duties of the court under the Act. As we have stated, the objectors stress the use by the legislature of “shall” in describing the court’s duty to order a sale, and stress that “shall” has also been used in describing the function of the collector to give notice of his intended application for judgment of sale, a duty held to be mandatory in People ex rel. Larson v. Rosewell (1980), 88 Ill. App. 3d 272. Public Act 82 — 987 changed the Act, which provided that the collector “shall” give notice of the application, to provide that “it shall be mandatory for him” to do so. (1982 Ill. Laws 2471, 2472.) This supports our interpretation here of “shall.” By adding that “it shall be mandatory for him” (the collector), the legislature showed its recognition that “shall” is not always to be equated with “mandatory.” If this were not so, the legislature would have had no reason to change its language, especially after it had been judicially construed to be mandatory language in the case of collectors. Also, and very significantly, while the legislature added mandatory language in describing the duties of the collector, it did not do so in regard to the description of the function of the court. It left unchanged the provision that the court “shall” order a sale, retaining the language it considered required change in the case of collectors to show that their duties were mandatory. The objectors note that section 1 of the Civil Practice Act (Ill. Rev. Stat. 1979, ch. 110, par. 1) provides that the Act applies to all civil proceedings except “other proceedings in which the procedure is regulated by separate statutes.” They say that here the procedure is regulated by the Scavenger Act and therefore the Civil Practice Act was not applicable. We need not decide this question because, in any event, the court here can be said to have acted within its inherent authority. The General Assembly can enact laws governing judicial practice only when it does not unduly infringe upon the inherent powers of the judiciary. Agran v. Checker Taxi Co. (1952), 412 Ill. 145. The objectors argue that there is no showing that any judgments obtained through the pending suits will be collectible. The argument is unconvincing. One may assume that the State’s Attorney, as any other prudent attorney, would have investigated prior to the institution of suit and have been satisfied that the filing of suit would be productive. It should be noted, too, that the objectors are only a very small fraction of those owners whose property was designated for the scavenger sale. The State’s Attorney, prior to the institution of the Scavenger Act proceedings, must have been satisfied that the actions in debt against the objectors involved here would be productive. The State’s Attorney’s brief says that the appellate court ruling exposes over 290 actions in debt to possible dismissal. These 290 cases seek to recover over $7 million in delinquent real estate taxes. The State’s Attorney also says that in 1981 over 400 more actions in debt which seek collections of almost $8 million in delinquent taxes were filed. Obviously the question presented is not an isolated one. Incongruously, considering that they have avoided for five years or more the responsibility of paying taxes, the objectors say that, unless the provisions of the Scavenger Act are held to be mandatory, there will be no assurance that the provisions of the Act will be carried out and the property restored to a tax-revenue-producing status. We need only observe that in instance after instance the legislature imposes duties upon public officials which typically are performed without default. The entire structure of government functions on the assumption that persons charged with public responsibilities will discharge those responsibilities. It should be observed that simply because a parcel is not ordered to be sold in a given scavenger sale does not mean that its future sale is precluded. Property withheld from a sale may be included in a subsequent scavenger sale. The statute provides for the advertisement of the application for judgment and order of sale for tracts upon which taxes “for each of 5 or more years are delinquent.” (Emphasis added.) Ill. Rev. Stat. 1979, ch. 120, par. 716a. The two decisions principally relied upon by the objectors, and cited by the appellate court in its opinion, are simply not in point. Both consider the duties of the collector and not the powers of the court. The appellate court’s opinion states that it considered it unnecessary to consider in detail the points raised by counsel. The court simply said that stare decisis required that it reverse the orders appealed from. The court cited In re Application of Rosewell (1981), 93 Ill. App. 3d 1106, and People ex rel. Larson v. Rosewell (1980), 88 Ill. App. 3d 272. The appellate court, however, seriously misapprehended what those decisions involved. In People ex rel. Larson v. Rosewell (1980), 88 Ill. App. 3d 272, the court held that the collector was without discretion to omit tracts from his advertisement under the Scavenger Act of tax-delinquent property. The court said that because the purpose of the provision for notice of the collector’s intention to seek judgment against the property was to inform owners of the delinquency and give them an opportunity to object to the judgment, and was not simply being a rule for the guidance of public officials, the county officers must strictly comply with the requirement for publication. The collector had omitted certain parcels from publication because there were pending actions against owners of those parcels. The court fully perceived, however, that the issue before it was not the question here. The court stressed: “We are not suggesting, however, that an action for unpaid taxes once instituted cannot be pursued to final judgment if during the pendency of the action the taxes become delinquent for five years. That issue is not before us. Nor are we suggesting that our interpretation should jeopardize an action for unpaid taxes and frustrate attempts to collect the full amount of unpaid taxes. That issue is likewise not before us. We hold only that the county collector is mandated by the Scavenger Act to ‘publish an advertisement giving notice of the intended application for judgment for sale of all tracts of lands and lots upon which all or part of the general taxes for each of 5 or more years are delinquent.’ We express no opinion as to whether every parcel included in such advertisement must be the subject of a judgment for sale; the Scavenger Act provides that ‘[n]o sale of lands or lots pursuant to this Section shall be final until confirmed by the Court *•*.’ Ill. Rev. Stat. 1977, ch. 120, par. 735a.” 88 Ill. App. 3d 272, 278. The citation of In re Application of Rosewell (1981), 93 Ill. App. 3d 1106, by the objectors is somewhat remarkable, for there the court observed that under the Scavenger Act the scope of judicial discretion regarding a sale is broad. In that case the county collector had received the highest bid at a scavenger sale, had struck off the property as sold, and had received tender of payment. The court said that the collector may not reoffer the property for sale. The court held that under such circumstances the collector was without discretion whether to report to the court for confirmation of the sale. The court contrasted the collector’s responsibility in that respect under the Scavenger Act with that of the court. The circuit court, said the appellate court, has broad discretion during review of a sale. The appellate court cited People v. Anderson (1942), 380 Ill. 158, which involved the sale of real estate for delinquent and forfeited general taxes. This court observed in Anderson: “The rule is firmly established that the chancellor possesses a broad discretion in approving or disapproving a report of sale, and that his decision will not be disturbed unless there is a clear abuse of discretion.” (380 Ill. 158, 163.) It also cited Evans v. Hunold (1946), 393 Ill. 195, where this court stated: “In cases of sales requiring the approval of the court, the chancellor has a broad discretion to confirm or disapprove such sales.” 393 Ill. 195, 200. For the reasons given, the judgment of the appellate court is reversed and the judgment of the circuit court is affirmed. Appellate court reversed; circuit court affirmed.