Blossom63 Enters., LLC v. Devonshire, LLC (In re Cnty. Collector)

2022 IL 126929

201 N.E.3d 1064

460 Ill.Dec. 591

IN RE Application of the COUNTY COLLECTOR, for Judgment and Order of Sale Against Lands and Lots Returned Delinquent for Nonpayment of General Taxes for the Year 2014 and Prior Years

(Blossom63 Enterprises, LLC, Appellee,

v.Devonshire, LLC, Appellant).

Docket No. 126929

Supreme Court of Illinois.

Filed March 24, 2022.

Eric H. Wudtke, Terry J. Carter, and Jamie L. Schmidtke, of Carter Legal Group, P.C., of Chicago, for appellant.

David R. Gray Jr., of Chicago, for appellee.

JUSTICE NEVILLE delivered the judgment of the court, with opinion.

¶ 1 On February 15, 2018, GAN C, LLC (GAN C), filed a petition for a tax deed to acquire property it purchased at Cook County's 2016 annual tax sale for the tax year 2014. On April 24, 2018, GAN C assigned its interest in the property to Blossom63 Enterprises, LLC (Blossom63). On May 6, 2018, 6420 Longmeadow LLC, the owner of the property, transferred its interest in the property to Devonshire, LLC (Devonshire). On May 17, 2018, Devonshire filed a petition to intervene in the tax deed proceedings and moved to vacate Blossom63's tax deed on the ground Blossom63 failed to strictly comply with the notice requirements of the Property Tax Code (Tax Code). 35 ILCS 200/22-5, 22-10 (West 2016). On May 18, 2018, the circuit court of Cook County granted the petition for a tax deed, and the county clerk for Cook County issued Blossom63 a tax deed to the subject property. On June 19, 2019, the circuit court granted Devonshire's motion to vacate the order issuing a tax deed to Blossom63. The appellate court reversed, finding Blossom63's notice strictly complied with section 22-5 of the Tax Code. See 2020 IL App (1st) 191464, ¶ 29, 452 Ill.Dec. 972, 186 N.E.3d 1022. On March 24, 2021, we allowed Blossom63's petition for leave to appeal ( Ill. S. Ct. R. 315 (eff. Oct. 1, 2020)) and now affirm the judgment of the appellate court.

¶ 2 I. BACKGROUND

¶ 3 On June 3, 2016, GAN C purchased the delinquent property taxes on "Unit A" in a commercial condominium building in Lincolnwood at Cook County's annual tax sale for the tax year 2014. At the time of the tax sale, 6420 Longmeadow LLC owned the property. GAN C also paid the second installment on the 2013 property taxes on the condominium to complete the sale. See 35 ILCS 200/21-240 (West 2016). Section 21-240 of the Tax Code requires a purchaser at an annual tax sale (1) to pay, "forthwith," the taxes, special assessments, interest and costs advertised for the tax sale and (2) to pay, "within 10 days after the sale," the general taxes charged on the land remaining due and unpaid not included in the advertisement. Id. When payment is made, the "purchaser then shall be entitled to a certificate of purchase." Id.

¶ 4 On September 16, 2016, the county clerk for Cook County issued a certificate of purchase to GAN C for the property pursuant to section 21-250 of the Tax Code. See id. § 21-250. The certificate of purchase states GAN C purchased the property for the taxes, interest, and costs due and unpaid for the tax year 2014 and that it paid as purchase money on the property the total amount of taxes, interest, and costs. The certificate of purchase states GAN C paid $40,300.02 in general tax for 2014 and $6762.55 in general taxes for the 2013 second installment plus fees, for a total of $47,309.57.

¶ 5 On September 27, 2016, GAN C delivered a notice of sale form, pursuant to section 22-5 of the Tax Code (the notice of sale form provision), to the county clerk for Cook County for delivery. See id. § 22-5. Section 22-5 provides that to be entitled to a tax deed, "within 4 months and 15 days after any sale held under this Code, the purchaser or his or her assignee shall deliver to the county clerk a notice to be given to the party in whose name the taxes are last assessed." Id. GAN C's section 22-5 notice of sale form, on the line "Sold for General Taxes of (year)," read "Sold for General Taxes of 2014."¹ The section 22-5 notice of sale form listed March 29, 2017, as the date the period to redeem the property would expire and listed $47,340.01 as the amount needed to redeem the property.

¶ 6 On April 11, 2017, GAN C filed a notice, pursuant to section 22-10 (the notice of expiration of period of redemption form), with the county clerk for Cook County. See id. § 22-10.² Section 22-10 provides that

"[a] purchaser or assignee shall not be entitled to a tax deed to the property sold unless, not less than 3 months nor more than 6 months prior to the expiration of the period of redemption, he or she gives notice of the sale and the date of expiration of the period of redemption to the owners, occupants, and parties interested in the property." Id.

GAN C's section 22-10 notice of expiration of period of redemption form, on the line "Sold for General Taxes of (Year)," read "2014 (2013 Incld)." See Appendix II, infra ¶ 56. The section 22-10 notice of expiration of period of redemption form stated the period of redemption would expire on September 13, 2017.

¶ 7 A. Circuit Court

¶ 8 On February 15, 2018, GAN C filed an application in the circuit court of Cook County for an order directing the county clerk to issue a tax deed. GAN C attached copies of its certificate of purchase, the section 22-5 notice of sale form, and the section 22-10 notice of expiration of period of redemption form to the application.

¶ 9 On April 24, 2018, GAN C assigned its rights and interest in the certificate of purchase to Blossom63. On May 6, 2018, 6420 Longmeadow LLC transferred its property to Devonshire by warranty deed. On May 17, 2018, Devonshire moved to intervene in the tax sale proceedings, and the circuit court granted its motion. On May 18, 2018, the circuit court entered an order to issue a tax deed to the property to Blossom63. Blossom63 recorded the tax deed to the property.

¶ 10 On June 14, 2018, Devonshire moved, pursuant to section 2-1203 of the Code of Civil Procedure ( 735 ILCS 5/2-1203 (West 2018) ), to vacate the order issuing a tax deed to Blossom63 on the ground the section 22-5 and 22-10 notices failed to strictly comply with the Tax Code. On March 18, 2019, the circuit court granted Devonshire's motion to vacate on the ground Blossom63 failed to strictly comply with the notice requirement in section 22-5 of the Tax Code by listing only 2014 as the tax year sold without including the 2013 second installment taxes. The circuit court entered an order vacating Blossom63's tax deed and ordering Devonshire to pay interest on the amount it owed Blossom63 pursuant to section 22-80 of the Tax Code. See 35 ILCS 200/22-80 (West 2016). Section 22-80 of the Tax Code requires a party who is successful in a challenge to an order to issue a tax deed to pay the tax deed grantee, or his or her successors and assigns (or, if a tax deed has not yet issued, the holder of the certificate), within 90 days after the date of the finding, the amounts delineated in section 22-80(b). See id. § 22-80(b). The parties disagreed on the amount of interest Devonshire had to pay to Blossom63. The circuit court agreed with Devonshire on the amount of interest it had to pay Blossom63 and ordered the funds deposited with the clerk of the circuit court pending appeal. Blossom63 appealed the circuit court's order vacating the judgment directing the county clerk to issue a tax deed.

¶ 11 B. Appellate Court

¶ 12 A divided panel of the appellate court found that the parties conceded that the Tax Code requires strict compliance with the section 22-5 notice requirements. 2020 IL App (1st) 191464, ¶¶ 19, 22, 452 Ill.Dec. 972, 186 N.E.3d 1022 ; 35 ILCS 200/22-40(a) (West 2016). In the appellate court, Devonshire argued that (1) section 21-240 of the Tax Code required Blossom63 to pay the 2014 taxes and the outstanding second installment of the 2013 taxes to complete the sale and (2) the 2013 taxes were part of the tax sale and Blossom63 was required to list both the 2014 and 2013 taxes on Blossom63's section 22-5 notice of sale form. See 2020 IL App (1st) 191464, ¶ 25, 452 Ill.Dec. 972, 186 N.E.3d 1022.

¶ 13 The appellate court found that the purpose of the first part of the section 22-5 notice of sale form requiring the tax purchaser to list the year of the property taxes purchased at the sale (" ‘Sold for General Taxes of (year)’ ") is to inform the property owner of the sale for delinquent taxes and specifically "requires the [purchaser] to list the tax year sold—2014, in this case." Id. ¶ 26. The appellate court found that the second part of the section 22-5 notice of sale form serves a different purpose: to advise the property owner of the need to redeem the property to avoid losing title and to inform the owner that the property will go to tax deed unless redeemed by a specified date for a specified sum of money. Id. ¶ 29. The appellate court held Blossom63 satisfied the purpose of the first part of the notice of sale form by listing 2014 as the tax year sold "as required by the form" without also listing prior years that had to be paid. Id. ¶ 27.

¶ 14 The appellate court also found that a completely separate section of the Tax Code, section 21-240, provides that the purchaser must pay all prior unpaid taxes to obtain a certificate of purchase. Id. ¶ 26. The appellate court held that "Blossom63 was required to pay the unpaid 2013 second installment to complete the 2014 tax sale purchase, but it did not purchase the 2013 taxes at the 2014 tax sale. So Blossom63 complied with the requirement that it list ‘Sold for General Taxes of (year)’ by listing 2014 only." (Emphases added.) Id. The court also held Blossom63 satisfied the purpose of the second part of the section 22-5 notice of sale form by "informing Devonshire that, by a specified date, it must pay $47,309.57, which includes both the 2014 and 2013 taxes," because that was the "information necessary to avoid the owner losing the property." Id. ¶ 29.

¶ 15 The dissenting justice found that "[t]he use of ‘(year)’ on the ...