Court Opinion

ID: 7015915
Source: CourtListenerOpinion
Date Created: 2022-07-24 04:20:24.450451+00
Date Added: 2024-06-11T16:10:23.254763
License: Public Domain

Mr. JUSTICE SULLIVAN, dissenting: I cannot agree with the opinion of the majority. Involved here is section 13½ of the Act (Ill. Rev. Stat. 1973, ch. 120, par. 452½), which provides that an officer or employee who has the control, supervision or responsibility of filing returns and making payment of the amount of taxes imposed and who wilfully fails to do so shall be personally hable for the tax, including penalties and interest, “in the event that'after proper proceedings for the collection of such amounts, as provided in said Act, such corporation is unable to pay such amounts to the department * * It is the quoted phrase that we are concerned with and particularly the intent of the legislature in its use of the words “proper proceedings.” It should initially be noted that Bublick and the corporation admitted in their answer to plaintiff’s complaint that the corporation was unable to pay the tax. The record also discloses that in mid-1972 plaintiff’s auditors assessed a deficiency of over *92,000, which was admitted in an amended return by the corporation reflecting this amount. Only *5,000 was paid, and thereafter the corporation ceased to do business. After payment of all debts and expenses, there was left approximately *11,000, consisting of prepaid sales tax, accrued interest, accounts receivable, and layaway receivables. Thus, there appears no question that the corporation was unable to pay its tax in January, 1974, when plaintiff brought this action. Judgment thereafter was first entered against the corporation, and two months later, following a bench trial, judgment in like amount was entered against Bublick. The majority, however, would reverse the judgment against Bublick because it “was not entered after proper proceedings for the collection of the taxes from the corporation.” It is difficult to understand this conclusion in view of the admissions by Bublick and the corporation that (1) plaintiff did attempt to collect the taxes from the corporation; and (2) the corporation was unable to pay them. Specifically, the majority found that proper proceedings to collect were not undertaken because “the evidence at trial fails to establish that plaintiff pursued even one of the myriad of summary remedies which are available to a judgment creditor before proceeding against the corporate officers under section 13%” and “failed to produce any evidence that it had employed any form of execution on the initial judgment [against the corporation] prior to the entry of the later judgment [against Bublick].” It is apparent that the majority views “proper proceedings” to mean that some form of post-judgment legal action to collect should have been taken against the corporation before the entry of judgment against Bublick. This construction does not appear to be justified for a number of reasons. First, the phrase “proper proceedings” is not further defined in the Act and there is no requirement in the Act that any post-judgment collection action be taken against a corporation before personal liability of an officer attaches. Second, to require such action would result in unnecessary and perhaps extended litigation as to whether the proceedings undertaken to collect were proper. This undoubtedly would cause delay in the collection of taxes which, in my opinion, would render the law ineffective and any such result should be avoided if the Act is susceptible of a more effective construction. (People ex rel. Barrett v. Thillens, 400 Ill. 224, 79 N.E.2d 609.) In this regard, it has been held that statutes relating to the collection of taxes must be given a meaning to avoid making it difficult or impossible for the taxes to be legally collected. (People ex rel. Nash v. Chicago & Northwestern R.R. Co., 359 Ill. 435, 194 N.E. 560.) Third, to hold that post-judgment collection action in some form be undertaken against the corporation here is to require the performance of a useless act which, in my opinion, should be obviated by the corporation’s admitted inability to pay. See Wurster v. Albrecht, 237 Ill. App. 284. My examination of the Act in the light of the rule that it must be given a reasonable and common sense meaning to avoid making it difficult or impossible to collect the taxes (People ex rel. Nash), convinces me that the legislature did not intend to require that plaintiff take any useless post-judgment action to collect from a corporation whose inability to pay was admitted. Because the majority has reversed for the sole reason that such action was not taken, I must respectfully dissent from its opinion.