Sears Holdings Corp. v. Pappas

• Decision Date: 07 May 2009
• Docket Number: No. 1-08-1115.,1-08-1115.
• Citation: 391 Ill. App. 3d 147,908 N.E.2d 556
• Parties: SEARS HOLDINGS CORPORATION, Plaintiff-Appellee, v. Maria PAPPAS, County Treasurer and Ex Officio County Collector of Cook Illinois, Defendant-Appellant.
• Court: United States Appellate Court of Illinois

908 N.E.2d 556

391 Ill. App. 3d 147

SEARS HOLDINGS CORPORATION, Plaintiff-Appellee, v. Maria PAPPAS, County Treasurer and Ex Officio County Collector of Cook Illinois, Defendant-Appellant.

No. 1-08-1115.

Appellate Court of Illinois, First District, Fourth Division.

May 7, 2009.

Rehearing Denied June 2, 2009.

Richard A. Devine, State's Attorney, Cook County, Chicago (Patrick T. Driscoll, Jr., Tatia Gibbons, Ayesha Khan, Jessica Pipersburgh), for Appellant.

Neal, Gerber & Eisenberg LLP, Chicago (David S. Martin, Thomas J. McNulty, Thomas J. Boyle), for Appellee.

Justice NEVILLE delivered the opinion of the court:

The Cook County assessor (Assessor) made a determination that Sears Holdings Corp. (Sears Holdings), the plaintiff, overpaid its taxes. Following the determination, the Assessor executed a certificate of error and sent a letter that informed Sears Holdings about the nature and cause of the error in the tax assessment. The Assessor's certificate of error was later endorsed by the three members of the board of review. The Cook County treasurer (Treasurer), the ex officio county collector,¹ filed an application before the trial court for judgment and the Assessor filed an objection. The trial court entered a final judgment on December 20, 2005, on the tract described in the objection and ordered a tax refund to the taxpayer for the 2001 taxes that were levied based upon an assessed property value that was excessive. In a subsequent order, the April 2, 2008, order, the trial court directed the Treasurer to refund to the taxpayer, Sears Holdings, statutory interest, pursuant to section 20-178 of the Property Tax Code (35 ILCS 200/20-178 (West 2006)). Therefore, the Treasurer refunded $369,481.58 to the taxpayer, including $11,084.45 in interest, for the period beginning December 20, 2005 and ending on July 26, 2006, the date the refund was made.

Sears Holdings filed a motion to compel the Treasurer to pay interest retroactive to 60 days after April 22, 2003, the date the Assessor issued the certificate of error. The Treasurer filed a motion to dismiss Sears Holdings' motion to compel. On December 3, 2007, the trial court denied the Treasurer's motion to dismiss and granted Sears Holdings' motion to compel. In an April 2, 2007, order, the trial court ordered the Treasurer to recalculate the section 20-178 statutory interest awarded on the certificate of error refund and to apply a credit in the amount of $11,084.45 to the interest calculated pursuant to the order.

In this appeal, the Treasurer argues (1) that the trial court erred when it denied its motion to dismiss Sears Holdings' motion to compel and ordered a recalculation of the interest due on the refund, and (2) that the trial court erred when it ordered the payment of judgment interest, pursuant to section 2-1303 of the Code of Civil Procedure. 735 ILCS 5/2-1303 (West 2006).

BACKGROUND

Sears Holdings is the owner of a parcel of property identified by the permanent index number of 15-25-200-002-0000 and commonly known as 7503 Cermak Road, North Riverside Park, Cook County, Illinois. In 2001, the total tax levied against the property was $717,220.18. Sears Holdings paid $347,546.57 as the first installment of the 2001 taxes on February 27, 2002. Sears Holdings also paid $369,973.61 as the second installment of the 2001 taxes on October 25, 2002.

On April 22, 2003, the Cook County Assessor sent the following letter to Sears Holdings in connection with the issuance of a certificate of error:

"We are pleased to inform you that the Cook County Assessor's Office has issued a Certificate of Error which may affect your property taxes. Please note that the issuance of the Certificate of Error is only the first step in the process. The Certificate of Error becomes final only after the Assessor's Office or the Circuit Court approves it.

Meanwhile, prior to final approval, you may submit the recommended tax bill to the Cook County Collector's Office. The information below details the recommended tax amount due for your property. The recommendation assumes that the Certificate of Error will be finally approved. If the Certificate of Error is denied, you will be liable for the entire amount of the original tax bill. Please refer to the enclosure for further details concerning Certificates of Error.

You will receive written notice of the final approval or denial of your Certificate of Error. If the Certificate of Error receives final approval, your tax bill will be adjusted accordingly. If the final approval of the Certificate of Error entitles you to a refund, the Cook County Collector will send you further information.

If you pay this bill in person, please make sure that you give the Collector this entire statement, as well as your original tax bill. If you pay this bill by mail, include the bottom portion of this bill with your payment. It is strongly advised that you retain a copy of this letter for your records." (Emphasis in original.)

The Assessor's letter that was mailed to the taxpayer also indicates (1) that Sears Holdings' property's original assessed value was $4,200,647, (2) that the property's original equalized assessed value was $9,702,654, (3) that the property's recommended assessed value was $2,036,651, and (4) that the property's recommended equalized assessed value was $4,704,256. The Assessor's letter also indicated that the total recommended tax was $347,738.60.

The certificate of error in the record indicated that the assessed valuation of the parcel has previously been fixed at $1,315,320 for the land and $2,885,327 for the improvements for a total of $4,200,647. The certificate of error also indicated that the correct assessed valuation was $1,315,320 for the land and $721,331 for the improvements for a total of $2,036, 651. Therefore, the certificate of error provided that there was an excessive valuation for the year in question of $2,163,996. Therefore, the certificate of error provided that the recommended equalized assessed value of $4,704,256 be multiplied by the tax rate of 7.392%, which yielded a total recommended tax of $347,738.60. Therefore, as a result of the issuance of the certificate of error, the original tax burden, which was originally set at $717,220.18 was reduced to $347,738.60.

As required by section 14-15 of the Property Tax Code (35 ILCS 200/14-15 (West 2002)), the three members of the board of review endorsed the Assessor's certificate of error between January 27, 2005, and February 15, 2005 (Joseph Berrios on January 27, 2005; Maureen Murphy on February 7, 2005; and Larry Rogers on February 15, 2005), and found that "an occupancy factor was not applied to the [building] value."

On December 20, 2005, the trial court entered a final judgment and agreed order based upon the Assessor's objection to the application of the county collector of Cook County.² In the trial court's December 20, 2005, order, it found that the parties agreed (1) that the Assessor (a) discovered an error in the assessment on the subject property, (b) executed a certificate that correctly and accurately set forth the nature and cause of the error, and (c) filed the certificate of error and supporting documentation with the trial court to correct the error pursuant to the authority granted by section 14-15 of the Property Tax Code (35 ILCS 200/14-15 (West 2002)); (2) that the certificate of error was endorsed by the Assessor or the Assessor and the board of appeals; (3) that the original assessment was excessive and needed to be reduced; and (4) that the parties stipulated to the admission into evidence of the certificate of error and supporting documentation. In addition, based upon the agreement of the parties and upon the certificate of error and documentation supporting the certificate, the trial court sustained the Assessor's objection and entered judgment in favor of the people of the State of Illinois and against the above-described tract of land for the amount of taxes, interest, penalties and costs based upon the assessed unequalized valuation of $2,036,651. The order also provided that no judgment was to be entered for taxes in excess of the aforementioned amount and that any excess taxes that were paid were to be refunded.

On July 26, 2006, the county collector prepared and issued check number 02315986 in the amount of $380,566.03. Pursuant to section 20-178 of the Property Tax Code, the July 26, 2006, refund check of $369,481.58 included the 2001 excess taxes paid by Sears Holdings and interest in the amount of $11,084.45 for the period beginning December 20, 2005, the date of the final judgment, and ending July 26, 2006, the date the refund was paid.

On June 12, 2007, Sears Holdings filed a motion to compel enforcement of the court's December 20, 2005, order and argued that Maria Pappas, the Cook County Treasurer, should have paid additional interest on the certificate of error refund: interest should have been paid from 60 days after April 22, 2003, the date the certificate of error issued until July 26, 2006, the date the refund was paid. On August 30, 2007, the Treasurer filed a motion under sections 2-619(a)(2) and (a)(9) of the Code of Civil Procedure (735 ILCS 5/2-619(a)(2), (a)(9) (West 2006)) to dismiss Sears Holdings' motion to compel enforcement of the court's December 20, 2005, order. The Treasurer argued that the motion to compel should have been dismissed (1) because Sears Holdings lacked standing to object to any part of the certificate of error process because taxpayers have no statutory or constitutional right to participate in the process, and (2) because section 20-178 of the Property Tax Code governs the calculation of interest on a certificate of error refund.

Sears Holdings argued in its response to the Treasurer's motion to dismiss that it had standing because it would receive a benefit from the enforcement of the certificate of error. Sears Holdings conceded that section 20-178 of the...