In re Cty. Collector

232 N.E.3d 574

2023 IL App (1st) 210523

IN RE Application of the COUNTY COLLECTOR, for Judgment and Order of Sale Against Lands and Lots Returned Delinquent for Nonpayment of General Taxes And/or Special Assessments for the Year 2015 and Prior Years

(Gan C, LLC, Petitioner-Appellant and Cross-Appellee,

v.Maria Pappas, Cook County Treasurer and ex officio Cook County Collector and Nationwide Real Estate Investment, Inc., Respondents-Appellees,

(Nationwide Real Estate Investment, Inc., Respondent-Appellee / Cross-Appellant)).

No. 1-21-0523

Appellate Court of Illinois, First District, SECOND DIVISION.

Filed August 29, 2023

Appeal from the Circuit Court of Cook County, 19 COTD 4458, Honorable Maureen O. Hannon Judge Presiding.

Steven E. Friedman, of Chicago, for appellant.

Kimberly M. Foxx, State’s Attorney, of Chicago (Cathy McNeil Stein, Jonathon D. Byrer, and Sarah Cunningham, Assistant State’s Attorneys, of counsel), for appellee Cook County Collector.

Emmett R. McCarthy, of Stanko McCarthy Law Group, of Chicago, for other appellee.

OPINION

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

¶ 1 Gan C, LLC (Gan C), purchased a commercial property at Cook County’s annual tax sale. After allegedly discovering that the property was contaminated, Gan C filed a petition for sale in error under article 21 of the Property Tax Code. See 35 ILCS 200/21-310(b)(4) (West 2020). The circuit court denied the petition, finding that Gan C had not "met [its] burden" under the relevant statute. We agree with the circuit court’s interpretation of the statute and its review of the evidence. We thus affirm.

¶ 2 BACKGROUND

¶ 3 In 2015, Gan C purchased the delinquent taxes for a strip mall on Dolton Road in Calumet City (the Dolton Property) for approximately $1.4 million. Initially, Gan C assigned the certificate of purchase to another company, Eeservices, Inc. As the assignee, Eeservices attempted to have the transaction declared a sale in error based on an administrative error—the property was listed for auction at "Dolton Avenue" as opposed to "Dolton Road." A different panel of this court agreed with the circuit court that this was not a proper basis for a sale in error. See In re Application of the County Treasurer & ex officio County Collector, 2020 IL App (1st) 190014, ¶ 17, 443 Ill.Dec. 159, 161 N.E.3d 283.

¶ 4 While the Eeservices appeal was pending in this court—and as far as we can tell, completely unbeknownst to this court—Eeservices assigned the certificate of purchase back to Gan C, the original holder. (The principal of Eeservices and the principal of Gan C, as well as the principal of another entity that at one point was assigned this certificate (AJD Tax Liens, LLC), are all the same person, a Mr. Bingham.)

¶ 5 In any event, while the Eeservices appeal was pending before this court, Gan C, now reassigned as the holder of the certificate of purchase, initiated a new action in the circuit court of Cook County. In that action, Gan C again applied for a sale in error, this time not due to an administrative error but due to "the existence of asbestos, lead and black mold" on the property. Attached to the petition was an initial Environmental Site Assessment.

¶ 6 Nationwide Real Estate Investment, Inc. (Nationwide), the owner of the Dolton Property, argued that Gan C’s application for sale in error was barred by res judicata, given Eeservices’ prior application for a sale in error on the same Dolton Property. (The court later found res judicata inapplicable; we need not reach this issue.)

¶ 7 The Cook County Treasurer (County) also challenged Gan C’s petition. The County first attacked the veracity of the environmental report, claiming its conclusions were "mostly vague and it is unclear how they would constitute a hazardous substance or waste." It then argued that Gan C’s application was legally insufficient because it did not meet the requirement of section 21-310(b)(4) in that there was no evidence that Gan C "would be required" to clean up the Dolton Property under any current law or administrative rule or regulation. The County likewise claimed that res judicata barred this new application for a sale in error.

¶ 8 In reply, Gan C attached three new environmental reports. The County again attacked these reports, arguing that they contained little more than "vague statements about soil content that could likely apply to any property in Cook County." None of those reports, the County emphasized, contained any expert opinion that the Dolton Property would be subject to government-mandated remediation for violation of any existing environmental law or regulation.

¶ 9 The County also noted that much of the underlying information on which the three new reports relied (oral and written statements, plus photographs) came direct- ly from Gan C’s principal, Mr. Bingham. The County attacked Mr. Bingham’s credibility, noting a recent incident in which the Calumet City police arrested three individuals for trespass on the Dolton Property. According to the report, these three individuals had presented fake credentials claiming to be inspectors for Calumet City; when questioned by the police, these individuals claimed that they were sent by Mr. Bingham to obtain samples and conduct testing. Mr. Bingham, when contacted by the police, acknowledged that he sent those men but was less clear on his knowledge of the false credentials they showed store owners on the Dolton Property. Ultimately, the police handled the matter as an ordinance violation, for which the individuals were cited for solicitation without a license and were given a trespass warning.

¶ 10 In July 2021, the parties appeared for oral argument. The parties argued their respective positions. But Gan C informed the court that it would call a witness, a Mr. Matthew Otto, who authored one of the four environmental reports. Opposing counsel objected; Gan C had given no notice of its intent to call a live witness or that any evidentiary hearing was planned. The County argued that, if the matter was going to proceed to an evidentiary hearing, the County would need time to prepare for Mr. Otto’s testimony and perhaps call witnesses of its own—including possibly some of the witnesses involved in the trespass onto the Dolton Property that was the subject of the Calumet City police report.

¶ 11 The court was willing to let Mr. Otto testify with the caveat that, "to the extent that the [County] wants more time to depose him if for some reason he says something strange or present another witness because this is new material, I’m going to allow that." Gan C considered the court’s offer and, after a short recess, withdrew Otto as a witness. Having withdrawn its only live witness, Gan C’s counsel proceeded to argue its case on the papers alone.

¶ 12 The court denied the application for a sale in error, ruling that Gan C had not "met their burden." While noting that Gan C had proffered four reports, the court stated that "[n]one of those reports can definitively say that there is a hazardous substance, hazardous waste, or an underground storage tank that would require a cleanup or removal under any federal state, or local law." After counsel for Gan C sought clarification, the court stated:

"I don’t think that you have met both prongs of the statute, that you haven’t met that there is a hazardous substance, hazardous waste, or an underground storage tank definitively, nor have you identified that there is a federal, state, or local law, ordinance, or regulation that would require cleanup of and removal under the law."

¶ 13 Gan C timely appealed.

¶ 14 ANALYSIS

¶ 15 I

[1, 2] ¶ 16 We begin with our standard of review. The parties all agree that the interpretation of a statute is a question of law subject to de novo review. Id. ¶ 4. Both Gan C and the County say, however, that we should review the court’s interpretation of the documentary evidence under the manifest-weight-of-the-evidence standard.

[3] ¶ 17 True, we employ the manifest-weight standard to findings of fact after an evidentiary hearing. But here, there was no live testimony and no credibility determinations of witnesses; the matter was decided entirely on documents and written and oral argument. Because we review the exact record presented to the trial court, the trial court is not in a superior position to make findings, and our review is de novo. Cleeton v. SIU Healthcare, Inc., 2023 IL 128651, ¶ 26, 468 Ill.Dec. 271, 220 N.E.3d 1050 ("where the circuit court only considered documentary evidence (depositions, transcripts, etc.), de novo review applies"); Addison Insurance Co. v. Fay, 232 Ill. 2d 446, 453, 328 Ill.Dec. 858, 905 N.E.2d 747 (2009) (where trial court made findings based on purely documentary record and legal argument that is likewise available to reviewing court, "a reviewing court is not bound by the trial court’s findings and may review the record de novo"); Dowling v. Chicago Options Associates, Inc., 226 Ill. 2d 277, 285, 314 Ill. Dec. 725, 875 N.E.2d 1012 (2007) (when trial court heard no live testimony but only "relied on the parties’ oral argument and the record," "we review the court’s ruling on this issue de novo").

[4] ¶ 18 On de novo review, we afford no deference to the trial court’s decision. In re Application of the County Treasurer & ex officio County Collector of Greene County, 2022 IL App (4th) 190904, ¶ 22, 456 Ill.Dec. 740, 193 N.E.3d 980. We perform the same analysis as the trial court and may affirm on any basis in the record, regardless of the trial court’s reason and regardless of whether the trial court’s reasoning was correct. Khan v. Fur Keeps Animal Rescue, Inc., 2021 IL App (1st) 182694, ¶ 25, 458 Ill.Dec. 873, 197 N.E.3d 286.

¶ 19 II

¶ 20 With that clarified, we turn to the merits. Gan C argues that the circuit court erred in denying its petition for sale in error primarily because it accepted the County’s erroneous interpretation of section 21-310(b)(4). We agree that it...