Tillman v. Pritzker
| Decision Date | 06 August 2020 |
| Docket Number | NO. 4-19-0611,4-19-0611 |
| Citation | 443 Ill.Dec. 833,162 N.E.3d 467,2020 IL App (4th) 190611 |
| Parties | John TILLMAN, Plaintiff-Appellant, v. J.B. PRITZKER, in His Official Capacity as Governor of the State of Illinois; Michael W. Frerichs, in His Official Capacity as Treasurer of the State of Illinois; and Susana A. Mendoza, in Her Official Capacity as Comptroller of the State of Illinois, Defendants-Appellees. |
| Court | United States Appellate Court of Illinois |
John E. Thies, of Webber & Thies, P.C., of Urbana, and Raoul G. Cantero III, of White & Case LLP, of Miami, Florida, for appellant.
Kwame Raoul, Attorney General, of Chicago (Jane Elinor Notz, Solicitor General, and Richard S. Huszagh, Assistant Attorney General, of counsel), for appellees.
¶ 1 In July 2019, plaintiff, John Tillman, filed a petition for leave to file a taxpayers' suit against defendants, J.B. Pritzker, Governor of the State of Illinois; Michael Frerichs, Treasurer of the State of Illinois; and Susana Mendoza, Comptroller of the State of Illinois, in their official capacities (collectively, the State Officers), pursuant to section 11-303 of the Code of Civil Procedure (Code) ( 735 ILCS 5/11-303 (West 2018) ). The complaint attached to the petition alleged, in relevant part, that the State had issued bonds in 2003 and 2017 without providing an appropriate "specific purpose" as required by section 9(b) of article IX of the Illinois Constitution. Ill. Const. 1970, art. IX, § 9 (b). Tillman's complaint sought to enjoin the State Officers from making any future payments on the 2003 and 2017 bonds.
¶ 2 Later that month, the Attorney General of the State of Illinois entered his appearance on behalf of the State Officers. The Attorney General filed an objection to Tillman's petition, and Tillman filed a response.
¶ 3 In August 2019, the trial court conducted a hearing on the petition. After considering arguments from the parties, the court took the case under advisement. Shortly thereafter, the court entered a written order denying Tillman's petition for leave to file a complaint, finding (1) the statutes authorizing the 2003 and 2017 bonds set forth their specific purpose with sufficient detail, (2) the filing of the complaint would be an unjustified interference with the application of public funds, and (3) Tillman was asking the court to address a "political question" regarding a judgment made 20 years prior by the legislature, which would "violate the separation of powers."
¶ 4 Tillman appeals, arguing the trial court erred by denying him leave to file his complaint. Tillman contends that the court improperly reached the merits of his case rather than addressing whether the complaint was frivolous or malicious. Tillman asserts that his complaint was not frivolous because the 2003 and 2017 bonds were unconstitutional.
¶ 5 The State responds that the trial court properly rejected the claim because (1) the statutes are constitutional, (2) Tillman could never state a claim for relief, (3) the complaint would be barred by (a) the statute of limitations and (b) laches, and (4) Tillman failed to join bondholders as necessary parties.
¶ 6 We conclude that because Tillman's complaint was not frivolous or malicious, the trial court erred by denying his petition for leave to file it. Accordingly, we remand the case for further proceedings.
¶ 9 In July 2019, Tillman filed a petition for leave to file a taxpayers' suit against the State Officers pursuant to section 11-303 of the Code ( 735 ILCS 5/11-303 (West 2018) ) and attached a copy of the proposed complaint to his petition. In essence, Tillman asserted that the State of Illinois had issued unconstitutional bonds in 2003 and 2017 because the authorizing statutes (see 30 ILCS 330/7.2, 7.6 (West 2018)) failed to provide a specific purpose as required by section 9(b) of article IX of the Illinois Constitution of 1970. According to the complaint, article IX of the constitution provides a limit on the legislature's authority to incur debt in the form of bonds. Sections 9(c) through (e) contain limitations on short term borrowing of general funds to cover budget deficits or refinance existing debt. Ill. Const. 1970, art. IX, § 9(c)-(e). Section 9 (b), on the other hand, provides as follows:
Ill. Const. 1970, art. IX, § 9 (b).
¶ 10 The complaint alleged that, when read in context with the structure of article IX, the term "specific purpose" in section 9 (b) imposed two requirements. According to the complaint, the second sentence sets forth a "procedural" requirement that the specific purpose be set forth in sufficient detail. The first sentence, by contrast, sets forth a "substantive" limitation, requiring the bonds be issued for a purpose other than general funds. That is, specific purposes amount to special projects, capital improvements, and other nonrecurring costs, as distinguished from regularly recurring costs paid out of the general fund.
¶ 11 The complaint alleged that the 2003 bonds were issued and used as a method of increasing general revenue funds. The revenue from the 2003 bonds was "to be used for the purpose of making contributions to the designated retirement systems." See 30 ILCS 330/7.2(a) (West 2018). Tillman asserted that such payments were typically made from the general revenue fund and the State incurs them every year. Accordingly, the purpose of the bonds was general and not specific.
¶ 12 Regarding the 2017 bonds, the complaint alleged that the purpose was to "pay[ ] vouchers incurred by the State prior to July 1, 2017." See 30 ILCS 330/7.6(b) (West 2018). Tillman contended that the statute was both substantively improper—in that the money to pay past debts, without regard to the type of debt, was unquestionably general and not specific—and procedurally improper because the statute did not state with the required specificity which vouchers were to be paid. The complaint requested the trial court to find the 2003 and 2017 bond statutes unconstitutional and to enjoin the State Officers from making further payments on the bonds.
¶ 14 In July 2019, the Attorney General filed an objection to Tillman's petition, requesting the trial court to deny the request to file a complaint on several grounds. First, the Attorney General argued that Tillman was barred by the doctrine of laches because he was aware of the cause of action at the time it arose—when the statutes authorizing the bonds were passed and the bonds issued—but delayed bringing the action for years after the bonds had been sold and the State had made substantial payments on them. Second, the Attorney General asserted that Tillman's claims regarding the 2003 bonds were barred by the five-year statute of limitations for civil actions. See 735 ILCS 5/13-205 (West 2018). Third, the Attorney General claimed Tillman had failed to join all necessary parties to the action by failing to name bondholders as defendants. The Attorney General asserted that the bondholders had a direct financial interest in the outcome of the suit and would be harmed if not joined as defendants.
¶ 15 Finally, the Attorney General argued that the 2003 and 2017 bond statutes were constitutional. More specifically, the Attorney General contended that Tillman's reading of section 9(b) was incorrect because the constitution did not place any "substantive" restriction on the legislature's ability to issue bonds. Instead, all the legislature was required to do was pass the law with a three-fifths majority and set forth the law's "specific purpose" with sufficient detail. The Attorney General relied upon the Illinois Supreme Court's decision in People ex rel. Ogilvie v. Lewis , 49 Ill. 2d 476, 274 N.E.2d 87 (1971), to support this position and to demonstrate that the statutes in question met the standard set forth by the supreme court.
¶ 16 Tillman filed a response in which he argued that laches and the statute of limitations were inapplicable because (1) the suit sought to enjoin only future payments and (2) each payment on the bonds constituted a new injury for limitations purposes. Tillman also argued that the bondholders were not necessary parties.
¶ 18 In August 2019, the trial court conducted a hearing on Tillman's petition at which it heard extensive arguments from the parties and took the case under advisement. Shortly thereafter, the court issued a written order denying Tillman's petition. In the order, the court first set forth the standards applicable to taxpayer lawsuits and identified the issue as "whether or not reasonable grounds exist for filing the suit." The court noted that Tillman was challenging the constitutionality of two statutes and whether reasonable grounds existed could be ascertained only by examining the language of the statutes to determine if they set forth specific purposes.
¶ 19 After stating it was relying on the Illinois Supreme Court's ruling in Lewis , the trial court wrote the following:
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Tillman v. Pritzker
...of such action. The appellate court reversed the circuit court's judgment and remanded for further proceedings. 2020 IL App (4th) 190611, 443 Ill.Dec. 833, 162 N.E.3d 467. For the following reasons, we reverse the judgment of the appellate court and affirm the judgment of the circuit court.......
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