Estate of DeBow v. City of East St. Louis, Ill., 5-90-0727

Citation228 Ill.App.3d 437,170 Ill.Dec. 457,592 N.E.2d 1137
Decision Date04 May 1992
Docket NumberNo. 5-90-0727,5-90-0727
Parties, 170 Ill.Dec. 457 ESTATE OF Walter DEBOW, Lola Murray, as Special Administrator, Plaintiff-Appellee, v. CITY OF EAST ST. LOUIS, ILLINOIS, a Municipal Corporation, Defendant-Appellant. Fifth District
CourtUnited States Appellate Court of Illinois

Page 1137

592 N.E.2d 1137
228 Ill.App.3d 437, 170 Ill.Dec. 457
ESTATE OF Walter DEBOW, Lola Murray, as Special
Administrator, Plaintiff-Appellee,
v.
CITY OF EAST ST. LOUIS, ILLINOIS, a Municipal Corporation,
Defendant-Appellant.
No. 5-90-0727.
Appellate Court of Illinois,
Fifth District.
May 4, 1992.
Rehearing Denied June 16, 1992.

Page 1138

[228 Ill.App.3d 438] [170 Ill.Dec. 458] Edward L. Welch, Edwardsville, for defendant-appellant.

Clyde L. Kuehn, Kuehn & Trentman, Belleville, for plaintiff-appellee.

Justice RARICK delivered the decision of the court:

On May 17, 1985, the Estate of Walter DeBow was awarded a $3.4 million jury verdict against the City of East St. Louis for injuries sustained by Walter DeBow while he was being held in the municipal jail. DeBow is physically and mentally disabled and resides in a nursing home at a cost of $325 per day. The City appealed the judgment and this court affirmed. DeBow v. City of East St. Louis (1987), 158 Ill.App.3d 27, 109 Ill.Dec. 827, 510 N.E.2d 895.

Despite repeated requests by the Estate for satisfaction of the judgment, the City refused to make payment. In March 1988, the Estate filed nonwage garnishments against the City's bank accounts. In return for the Estate's release of the garnishments, the City agreed to pay interest on the judgment and also issued a series of bonds, payable to the Estate, for the principal of the judgment and interest. These bonds will not be paid in full until the year 2004.

On September 21, 1990, the Estate filed a citation to discover assets and to effect execution of the judgment against the City. The citation was heard in the circuit court of St. Clair County on September 27, 1990. The Estate asked the court to execute on certain real property owned by the City, to wit, the City Hall and 220 acres of vacant ground, a former industrial site. The Estate asked the court to either order the City to execute deeds to the property or execute the deeds for the City pursuant to sections 2-1402 and 2-1304 of the Code of Civil Procedure (Ill.Rev.Stat.1989, ch. 110, pars. 2-1402, 2-1304). The City objected, arguing that it would like the opportunity to respond to the Estate's motion in writing. The City was given a 10-minute recess in which to review the Estate's motion and prepare an oral [228 Ill.App.3d 439] response. After the recess, the City again argued that it was unfair to require it to respond to the Estate's motion without more time to prepare. Over the City's objection, the court executed, on behalf of the City, two quitclaim deeds conveying to the Estate of Walter DeBow the East St. Louis City Hall and 220 acres of vacant ground. The Estate was authorized to sell the property but was required to make an accounting of any sale within 90 days, with any excess sale proceeds to be paid over to the City. A written order was entered September 27, 1990. The Estate executed a full and complete satisfaction of judgment to the City and a full and complete release in favor of the City.

On October 5, 1990, the City filed a motion to reconsider, asking the court to vacate and stay execution of the order of September 27, 1990. On October 31, 1990, the Estate filed a motion to dismiss the City's motion to reconsider. This motion argued that the City's motion to reconsider did not toll the 30-day time period during which the court retained jurisdiction over the case, and therefore, the court no longer had jurisdiction to hear the motion to reconsider. The Estate's motion also alleged that the motion to reconsider was moot pursuant to Supreme Court Rule 305(i) (134 Ill.2d R. 305(i)), in that the City had failed to obtain a stay of the court's order of September 27, 1990, and the Estate had transferred the real estate to a third-party purchaser. Attached to the Estate's motion to dismiss was an affidavit of Eric Rhein, trustee for a certain land trust, GSA33. The affidavit recites that GSA33 obtained title to the real estate in question from the Estate of Walter DeBow, that the Estate has no interest in GSA33, that neither the trustee nor GSA33 have acted as a nominee of the Estate, and that GSA33 was not a party to the litigation between the Estate and the City in which the Estate acquired title to the real estate. A guardian's deed attached to the motion to dismiss shows that the real estate was transferred

Page 1139

[170 Ill.Dec. 459] by the Estate to GSA33 on September 28, 1990.

On November 1, 1990, the court entered an order granting the Estate's motion to dismiss the City's motion to reconsider. The order found that the court was without jurisdiction to hear the motion to reconsider because more than 30 days had elapsed from entry of the judgment sought to be reconsidered and the motion to reconsider did not toll the 30-day time period during which the court retains jurisdiction of the cause. The order further found that, if the court did have jurisdiction, it would nevertheless be bound to dismiss the motion to reconsider on the ground of mootness under Supreme Court Rule 305(i) (134 Ill.2d R. 305(i)). The City had failed to perfect a stay of [228 Ill.App.3d 440] the order of September 27, 1990, and the Estate had transferred the subject real estate to a nonrelated third-party purchaser.

The City appeals, arguing that the property of a municipal corporation is not subject to execution to satisfy a debt owed to a judgment creditor. The City also argues that the trial court abused its discretion in not allowing the City adequate time in which to respond to the Estate's request for execution on City property.

On November 21, 1990, the Estate filed a motion to dismiss the appeal, arguing that this court lacks jurisdiction for the same reason the trial court lacked jurisdiction to hear the City's motion to reconsider and also that the issues raised in the appeal are moot in that, in the absence of a stay under Supreme Court Rule 305, the Estate transferred the subject real estate to a third-party purchaser, which transfer, pursuant to Supreme Court Rule 305(i), cannot be affected by a reversal or modification of the trial court's order. 134 Ill.2d R. 305.

On January 2, 1991, this court entered an order denying the Estate's motion to dismiss the appeal on the basis of lack of jurisdiction and ordering that the motion to dismiss on the basis of mootness be taken with the case. We will address that motion first.

Supreme Court Rule 305(b) (134 Ill.2d R. 305(b)) provides that an appellant may seek a stay pending review in the trial court or, if unsuccessful there, in the appellate court. While an appeal bond is ordinarily required, where the appeal is prosecuted by a municipal corporation, as here, the court may stay the judgment pending appeal without requiring that any bond be given. (134 Ill.2d R. 305(g).) However, Rule 305(i) provides that, if a stay is not perfected within 30 days of the entry of the judgment appealed from, or within any extension of time granted, the reversal or modification of the judgment does not affect the right, title, or interest of any person who is not a party to the action in or to any real or personal property that is acquired after the judgment becomes final and before the judgment is stayed. (134 Ill.2d R. 305(i).) It is this paragraph with which we are particularly concerned.

It is now well established that, in the absence of a stay, an appeal is moot if specific property, possession or ownership of which is the relief being sought on appeal, has been conveyed to third parties. (Town of Libertyville v. Moran (1989), 179 Ill.App.3d 880, 886, 128 Ill.Dec. 868, 872, 535 N.E.2d 82, 86.) This is because Rule 305(i) provides that reversal or modification of a judgment on appeal does not affect the right, title or interest of a third party in property where that property is transferred to the third party after the judgment appealed from becomes final [228 Ill.App.3d 441] and before the judgment is stayed. (134 Ill.2d R. 305(i).) The record must unequivocally disclose, however, that the third party was not a party, or a nominee of a party, to the litigation from which the appeal was taken. 134 Ill.2d R. 305(i); Moran, 179 Ill.App.3d at 886, 128 Ill.Dec. at 872, 535 N.E.2d at 86.

In the instant case, there is no question that the relief being sought by appellant/City is reversal of the order of September 27, 1990, conveying certain real estate to the Estate. The City sought but failed to perfect a stay of this order. It is equally clear that the Estate transferred the real estate to a third party, Trust GSA33, on September 28, 1990, one day after entry of the order conveying the property to the Estate. Finally, the affidavit

Page 1140

[170 Ill.Dec. 460] of Eric Rhein unequivocally discloses that this third party was not a party, or a nominee of a party, to the litigation between the City and the Estate. Thus, it would appear that, pursuant to Rule 305(i), reversal or modification of the judgment of September 27, 1990, which appellant/City seeks, would not affect the right, title or interest of the third party in the subject real estate.

Citing City of Chicago v. Hasley (1861), 25 Ill. 595, and cases following, the City argues that property of a municipal corporation cannot be taken by a judgment creditor to satisfy the judgment. To so allow, stated the Hasley court, would be to allow a party obtaining a judgment against the municipality to destroy it by taking away the property which sustains it. (25 Ill. at 597.) The court stated,

"The property of such corporations, and the taxes collected by them for public purposes, are a constituent part, and a necessary ingredient of their public power, and are no more liable to seizure and sale than the whole power itself would be. If not so, a party obtaining a judgment against the city would be able to do indirectly what no power short of the legislature can do--destroy the corporate powers and franchises by taking away the aliment which sustains them. Under our...

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