Canton v. Chorbajian, s. 79-419

• Decision Date: 24 September 1980
• Docket Number: Nos. 79-419,79-421,s. 79-419
• Citation: 88 Ill.App.3d 1015,410 N.E.2d 1166,44 Ill.Dec. 74
• Parties: , 44 Ill.Dec. 74 James M. CANTON, Plaintiff-Appellee, v. George CHORBAJIAN and Ann Chorbajian, his wife, Defendants-Appellants.
• Court: United States Appellate Court of Illinois

Page 1166

410 N.E.2d 1166

88 Ill.App.3d 1015, 44 Ill.Dec. 74

James M. CANTON, Plaintiff-Appellee, v. George CHORBAJIAN and Ann Chorbajian, his wife, Defendants-Appellants.

Nos. 79-419, 79-421.

Appellate Court of Illinois, Second District.

Sept. 24, 1980.

Hoogasian & Goshgarian, Ltd., Waukegan (Jack Hoogasian and James K. Booras, Waukegan, of counsel), for defendants-appellants.

Overholser, Ray, Flannery & Glick, Ltd., Libertyville, for plaintiff-appellee.

UNVERZAGT, Justice:

Defendants, George Chorbajian and Ann ¹ Chorbajian, appeal from two judgments entered by the circuit court of Lake County: The first, dated May 24, 1979, dismissed with prejudice defendants' petition under Section 72 of the Civil Practice Act (Ill.Rev.Stat.1979, ch. 110, par. 72); the second, dated June 5, 1979, granted judgment in favor of plaintiff, James M. Canton, for possession of certain premises described in his complaint for forcible entry and detainer. ² The issue we address on appeal is whether the trial court abused its discretion in dismissing the section 72 petition.

The facts as alleged in the petition show that on February 19, 1974, the county clerk issued a certificate of sale of certain forfeited property commonly known as 611 Sumac Road, Highland Park, Illinois, to Howard Elridge. Elridge subsequently assigned his interest to James M. Canton, the plaintiff here. The county clerk granted two extensions of the statutory time for redemption to July 1, 1976, and to February 19, 1977.

On January 21, 1977, plaintiff filed a complaint in the circuit court seeking an equitable lien on the property in the amount of $4154.66. Plaintiff's complaint alleged, inter alia, that: He paid the sum of $2647.34 to the county collector in real estate taxes for the years 1973-1974; defendants had been notified twice of the purchase of the property, on May 10, 1976 and August 17, 1976; that on or about July 1, 1976, and thereafter, he had several conversations with defendants, wherein the defendants requested him to forbear from proceeding to acquire a tax deed in exchange for their promise to pay him the amount due and owing as of January, 1977, i.e., $4154.66; that based on defendants' requests to forbear, he twice extended the period for redemption on January 5, 1976 and on May 10, 1976; that in reliance on defendants' promises of payment, he did not seek issuance of a tax deed and therefore lost his right to have a tax deed issued; and defendants have been unjustly enriched by his payment of the taxes.

If the dates set forth in the complaint are correct, the plaintiff did not speak with the defendants until about July 1, 1976 which was sometime after he had requested the two extensions of the redemption period; to-wit: on January 5 and May 10, 1976. Therefore, it is unlikely that plaintiff's requests for redemption extensions were made based on the defendants' requests that he forbear from proceeding to obtain a tax deed. The chronology would seem to support, however, the plaintiff's allegation that he did not petition for issuance of a tax deed in reliance upon the defendants' promises to redeem. But since the complaint was filed on January 21, 1977 and the second extended period of redemption did not expire until February 19, 1977, it appears the plaintiff had approximately one month's time remaining in which to petition for issuance of a tax deed pursuant to section 266 of the Revenue Act (Ill.Rev.Stat.1977, ch. 120, par. 747). The time for complying with the notice provisions of section 266 had passed by the time plaintiff filed his complaint for an equitable lien, however, and although the last notice sent to defendants on August 17, 1976, pursuant to section 263 of the Revenue Act (Ill.Rev.Stat.1977, ch. 120, par. 744) arguably could have sufficed as timely notice under section 266, it omitted the essential statutory element of the date when the period of redemption would expire and any tax deed issued would have been invalid. (See, Farlow v. Oliver (1963), 29 Ill.2d 493, 194 N.E.2d 262; Dick and Sanders v. Mitchell (1968), 103 Ill.App.2d 93, 242 N.E.2d 785.) Consequently, it appears plaintiff's reliance on defendants' promises to redeem had caused him, as alleged, to lose his right to a remedy at law; specifically, to have a tax deed issued.

Defendant George Chorbajian was personally served with summons and complaint on the evening of January 24, 1977. Defendants failed to file an answer or appear. Consequently, the trial court entered an order of default and a default judgment on March 18, 1977. A judgment was entered on April 4, 1977 which provided, inter alia, that plaintiff was to have an equitable lien upon the real estate; that defendants were to pay plaintiff the sum of $4204.98 within 14 days; and that, in the event of defendants' failure to pay this sum within the time specified, the property would be advertised for public sale.

Pursuant to the April 4, 1977 judgment, the premises were advertised for sale by publication for three successive weeks in the Highland Park News. The premises were subsequently sold to plaintiff at a public auction for $4458.32. The proceeds from the sale were sufficient to pay the amount found to be due and owing under the April 4 judgment. Plaintiff then filed a complaint for forcible entry and detainer on January 9, 1979 and summons was duly served on defendants on January 20, 1979. Defendants filed a motion to dismiss the complaint which was denied on January 30, 1979.

Defendants filed two petitions under section 72 of the Civil Practice Act (Ill.Rev.Stat.1979, ch. 110, par. 72). The first petition, filed on December 14, 1978, was dismissed on that same date. It is not clear from the record whether that dismissal was the result of an adjudication on the merits. It appears it was a dismissal due to a procedural error in notice, and no appeal was taken therefrom. In any case, the fact the defendants filed a second petition and supporting affidavit on February 2, 1979, and the plaintiff voluntarily participated in the proceedings relating thereto, was sufficient to revest the court with jurisdiction. Spears v. Spears (1977), 52 Ill.App.3d 695, 10 Ill.Dec. 395, 367 N.E.2d 1004.

The second petition sought relief from the March 18, 1977 judgment; the April 4, 1977 judgment; the September 16, 1977 judicial report of distribution and sale and the judgment and approval thereof. Defendants' petition alleged, inter alia, that they were at all times duly diligent and had a meritorious defense, namely, that the plaintiff as holder of the certificate did not obtain a tax deed within the time period prescribed by the Revenue Act (Ill.Rev.Stat.1977, ch. 120, pars. 734, 744, 747 and 765), and therefore that both the certificate of sale and the subsequent sale of the real estate are void. It likewise alleged that the defendants were ready and able to redeem the real estate. The petition further alleged that subsequent to the entry of the aforementioned judgments, plaintiff deliberately did not contact defendants, and that even though notice was published in a local newspaper, such notice was illegal and improper under the facts and circumstances of this case. Plaintiff filed a motion to dismiss the section 72 petition on March 1, 1979, setting forth his equitable lien theory in response to defendants' meritorious defense. After requesting sua sponte that the parties submit memoranda of law on the nature of an equitable lien as applicable to the facts of the instant case, the court found defendants' section 72 petition insufficient in that it did not allege a meritorious defense or due diligence. Accordingly, the court granted plaintiff's motion to dismiss on May 24, 1979. Defendants timely filed a notice of appeal on June 1, 1979.

The primary question raised by defendants in this appeal is whether the trial court erred in denying their section 72 petition when defendants were not notified of the entry of the default judgment, the judgment or the judgment approving the judicial sale. Defendants make several allegations in an attempt to demonstrate fraud and unconscionable behavior on the part of the plaintiff, the gist of which is that plaintiff secretly and deliberately did not afford them notice of the default judgment and that they were completely unaware of all proceedings until the forcible entry and detainer action was filed against them more than a year later.

It is our view that this case is readily distinguishable from Ellman v. De Ruiter (1952), 412 Ill. 285, 106 N.E.2d 350 and Elfman v. Evanston Bus Company (1963), 27 Ill.2d 609, 190 N.E.2d 348 upon which defendants rely heavily as controlling here. As defendants contend, these cases stand for the proposition that a motion to vacate a default judgment under section 72 calls into effect the equitable powers of the court when the exercise of such power is necessary to prevent injustice. The court will exercise its equitable powers to grant relief, however, only when the facts and circumstances of the particular case call for it (Mutual National Bank of Chicago v. Kedzierski (1968), 92 Ill.App.2d 456, 236 N.E.2d 336.) In Ellman, plaintiffs' counsel willfully concealed the entry of a default judgment until such time as the court lost its power to vacate at the expiration of 30 days. The court there stated as follows:

"While there was no duty on the attorney to notify defendant of the default judgments, fair dealing would require that he inform defendant of the defaults when the question arose instead of pursuing a course calculated to keep the defendant in ignorance until the time he could make a direct attack on the judgments had expired." 412 Ill. 285, 293, 106 N.E.2d 350, 354.

Elfman involved a similar situation where execution of a default judgment was deliberately delayed for the purpose of keeping knowledge of the judgment from the defendant until the 30-day period had expired.

Our consideration of the record convinces ...