Rajterowski v. the City of Sycamore
| Decision Date | 01 November 2010 |
| Docket Number | No. 2–09–1136.,2–09–1136. |
| Citation | 405 Ill.App.3d 1086,940 N.E.2d 682,346 Ill.Dec. 313,263 Ed. Law Rep. 900 |
| Parties | Michael A. RAJTEROWSKI, Robert Skelton, Lynn Skelton, Michelle Eliason, Jeffrey Eliason, Paul Brian Hudon, and Andrea Lee Hudon, Plaintiffs–Appellants,v.The CITY OF SYCAMORE and Sycamore Community Unit School District No. 427, Defendants–Appellees. |
| Court | United States Appellate Court of Illinois |
OPINION TEXT STARTS HERE
David A. Rolf, Todd M. Turner, Lisa A. Petrilli, Sorling, Northrup, Hanna, Cullen & Cochran, Ltd., Springfield, IL, for Plaintiffs–Appellants.Keith L. Foster, Kevin E. Buick, Timothy J. Conklin, Foster & Buick Law Group, LLC, Sycamore, IL, for City of Sycamore.
Kenneth M. Florey, Nanci N. Rogers, Scott L. Ginsburg, Robbins, Schwartz, Nicholas, Lifton & Taylor, Ltd., Robbins, Schwartz, Nicholas, Lifton, & Taylor, Ltd., Chicago, IL, for Sycamore Community Unit District No. 427.Justice JORGENSEN delivered the opinion of the court:
[346 Ill.Dec. 317 , 405 Ill.App.3d 1089] In an amended five-count complaint, plaintiffs, Michael A. Rajterowski, Robert and Lynn Skelton, Michelle and Jeffrey Eliason, and Paul Brian and Andrea Lee Hudon, sued defendants, the City of Sycamore (City) and Sycamore Community Unit School District No. 427 (School District), arguing that the City's real estate transfer tax, from which buyers of homestead real estate who had resided in the City for at least one year were exempt, violated the federal and state constitutions and that, in entering into an intergovernmental agreement under which the City forwarded transfer tax revenues to the School District, the City and the School District exceeded their constitutional and statutory authority. Defendants moved to dismiss plaintiffs' complaint, asserting that it failed to state a cause of action. 735 ILCS 5/2–615 (West 2008). The trial court granted defendants' motion as to all counts and dismissed plaintiffs' complaint with prejudice. Plaintiffs appeal. We affirm.
On March 21, 2006, a referendum was passed, authorizing the City, a home rule municipality, to impose a municipal transfer tax on real property transferred within its boundaries (Transfer Tax). On April 17, 2006, the City adopted Ordinance No.2005.93 (Ordinance), which established the Transfer Tax. The Ordinance became effective on June 1, 2006, and imposed on the transfer of title to real estate located in the City a tax at a rate of $5 for each $1,000 of value or fraction thereof.
The Ordinance was intended by the City to create a new source of funds that it would give to the School District, a public school district, to supplement the School District's operating revenue. The mechanism by which the City provides the funds to the School District is an intergovernmental agreement (Intergovernmental Agreement) executed pursuant to the Illinois Intergovernmental Cooperation Act (5 ILCS 220/1 et seq. (West 2008)). The agreement provided that certain start-up and ongoing operating expenses the City incurred that were related to the Transfer Tax would be withheld from the revenues generated by the tax. There would also be a cooperatively established method to account for the monies received from the Transfer Tax and distributed to the School District.
The Ordinance contains an exemption, which is at issue in this appeal, for buyers of homestead real estate within the City who have been residents of the City for at least one year:
“1. The following deeds shall be exempt from the tax levied by this Article:
* * *
(n) A deed or trust document where the grantee or buyer is purchasing homestead real estate within the [C]ity and has maintained resident status (whether as a tenant or as an owner-occupier of real property) within the corporate limits of the City * * * for a period of at least one year immediately prior to the date of application for exemption from the transfer tax to be imposed.” Sycamore Municipal Code § 3–20–6 (2006).
Rajterowski formerly lived one-quarter mile outside the City's limits and purchased a home in the City in July 2006.
[346 Ill.Dec. 318 , 940 N.E.2d 687]
Robert and Lynn Skelton formerly lived in Edwardsville and purchased a home in the City in October 2006. Michelle and Jeffrey Eliason formerly resided in Texas and purchased a home in the City in June 2006. Paul and Andrea Hudon formerly resided in Florida and purchased a home in the City in August 2006. Because plaintiffs had not been residents of the City for one year immediately prior to purchasing homestead property in the City, they did not qualify for the Transfer Tax exemption. Plaintiffs paid the Transfer Tax.1
On July 10, 2008, plaintiffs sued the City and the School District. In a five-count complaint, plaintiffs alleged that the Transfer Tax violates the United States and Illinois Constitutions and that, in entering into the Intergovernmental Agreement, the City and the School District exceeded their authority. Specifically, plaintiffs alleged that: (1) the Ordinance violates the privileges and immunities clause of article IV, section 2, of the United States Constitution (U.S. Const., art. IV, § 2) (count I); (2) the Ordinance violates the equal protection clause of the United States Constitution (U.S. Const., amend. XIV) (count II); (3) the Ordinance violates the uniformity clause of the Illinois Constitution (Ill. Const.1970, art. IX, § 2) (count III); (4) in enacting the Ordinance and entering into the Intergovernmental Agreement, the City exceeded its authority under the Illinois Constitution (count IV); and (5) in entering into the Intergovernmental Agreement, the School District exceeded its authority under the Illinois Constitution (count V).
On September 2, 2008, defendants moved to dismiss plaintiffs' complaint (735 ILCS 5/2–615 (West 2008)), alleging that it failed to state any cause of action. On November 25, 2008, the court held a hearing on the motion. On January 13, 2009, the court granted the motion, finding that plaintiffs' complaint failed to state a cause of action as to all counts. The court granted plaintiffs leave to file an amended complaint.
On February 10, 2009, plaintiffs filed an amended 26–page, 5–count complaint. Thereafter, on March 12, 2009, defendants moved to strike and dismiss the amended complaint. On April 17, 2009, defendants moved for sanctions (155 Ill.2d R. 137), arguing that plaintiffs' amended complaint contained no substantive changes from the initial complaint and, therefore, was an improper attempt to relitigate claims already decided by the trial court. A hearing on the motion to dismiss was held on August 20, 2009. On October 15, 2009, the trial court granted defendants' motion and dismissed plaintiffs' complaint with prejudice. Also, the court denied defendants' motion for sanctions, finding that sanctions were “not appropriate in this matter.” Plaintiffs appeal.
A motion to dismiss pursuant to section 2–615 of the Code of Civil Procedure (735 ILCS 5/2–615 (West 2008)) challenges only the complaint's legal sufficiency. Napleton v. Village of Hinsdale, 229 Ill.2d 296, 305, 322 Ill.Dec. 548, 891 N.E.2d 839 (2008); DeWoskin v. Loew's Chicago Cinema, Inc., 306 Ill.App.3d 504, 513, 239 Ill.Dec. 750, 714 N.E.2d 1047 (1999) (). The motion does not raise affirmative factual defenses.
[346 Ill.Dec. 319 , 940 N.E.2d 688]
DeWoskin, 306 Ill.App.3d at 514, 239 Ill.Dec. 750, 714 N.E.2d 1047. In ruling on a section 2–615 motion to dismiss, a court should inquire whether the allegations of the complaint, when accepted as true and considered in the light most favorable to the plaintiff, are sufficient to state a cause of action upon which relief may be granted. Turner v. Memorial Medical Center, 233 Ill.2d 494, 499, 331 Ill.Dec. 548, 911 N.E.2d 369 (2009). “Evidentiary material outside of the complaint may not be considered.” DeWoskin, 306 Ill.App.3d at 514, 239 Ill.Dec. 750, 714 N.E.2d 1047. Since Illinois is a fact-pleading jurisdiction, “a plaintiff must allege facts sufficient to bring his or her claim within the scope of the cause of action asserted.” Turner, 233 Ill.2d at 499, 331 Ill.Dec. 548, 911 N.E.2d 369. A plaintiff need not prove his or her case at the pleading stage; however, he or she must allege specific facts supporting each element of the cause of action, and “the court will not admit conclusions of law and conclusory allegations not supported by specific facts.” Visvardis v. Eric P. Ferleger, P.C., 375 Ill.App.3d 719, 724, 313 Ill.Dec. 812, 873 N.E.2d 436 (2007). A complaint should not be dismissed under section 2–615 unless no set of facts can be proved that would entitle the plaintiff to recover. Napleton, 229 Ill.2d at 305, 322 Ill.Dec. 548, 891 N.E.2d 839. We review de novo the trial court's dismissal of a complaint under section 2–615. Kelley v. Carbone, 361 Ill.App.3d 477, 480, 297 Ill.Dec. 355, 837 N.E.2d 438 (2005).
Home rule municipalities, such as the City, have the right to levy taxes. Ill. Const.1970, art. VII, § 6(a). They may exercise their taxation powers, unless restricted by the constitution or appropriate legislation. Mulligan v. Dunne, 61 Ill.2d 544, 550, 338 N.E.2d 6 (1975). A transfer tax in and of itself does not “offend any constitutional provisions.” Stahl v. Village of Hoffman Estates, 296 Ill.App.3d 550, 554, 230 Ill.Dec. 824, 694 N.E.2d 1102 (1998); see also 65 ILCS 5/8–3–19 (West 2006) (). Indeed, the central issue in this case is whether plaintiffs' complaint stated a cause of action that the exemption violates certain constitutional or statutory provisions.
The privileges and immunities clause provides that: “The Citizens of each State shall be entitled to all...
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