In Re Application of Rosewell

JUSTICE SIMON,

dissenting:

An underpinning of the majority opinion is its conjecture that an action to collect unpaid taxes “might have” to be dismissed once a scavenger sale of the taxpayer’s property occurs (97 Ill. 2d at 443), thereby relieving the property-owner of personal liability for those taxes. This issue was not briefed by the parties either in this court or in the appellate court. The majority concludes, on the basis of the uncertainty it perceives, that the legislature could not have meant to require the county collector to include in a scavenger sale properties against whose owner an action to collect back taxes is pending. This possibility, however, is foreclosed by the clear statement in the Scavenger Act itself that “[confirmation of the sale shall in no event affect the owner’s personal liability to pay the taxes, interest and penalties as provided in this Act; nor shall confirmation prevent institution of a proceeding under Section 275 of this Act to collect the amount remaining due after the sale.” (Ill. Rev. Stat., 1981 Supp., ch. 120, par. 716a.) This sentence was made a part of the Act by Public Act 82 — 987, paragraph 1, which became effective during the pendency of this appeal but was not brought to the attention of this court by either party. (See Ill. Ann. Stat., ch. 120, par. 716a, at 28 (Smith-Hurd Supp. 1982).) This provision would apply to the parcels and liabilities at issue in this case, as no scavenger sale involving them has yet been held and there has been no confirmation of any sale with respect to them.

Under the current and relevant version of the Scavenger Act the law is clear: A taxpayer who is delinquent in paying his property taxes is liable at all times for the amount of the arrearage (see Ill. Rev. Stat. 1981, ch. 120, par. 508a (“[t]he owner of real property on January 1 *** in any year shall be liable for the taxes of that year”)), and if he allows five years to go by without paying it he stands to lose his property too, provided that the property has been “forfeited” prior to that time under section 275 of the Revenue Act (Ill. Rev. Stat. 1981, ch. 120, par. 756) and provided that the various requirements of the Scavenger Act itself are fully complied with. This arrangement has the salutary effect of encouraging payment within the five years as well as of placing property on which taxes have been unpaid for more than five years in more responsible hands. Schreiber v. County of Cook (1944), 388 Ill. 297, 305; In re Application of Rosewell (1981), 93 Ill. App. 3d 1106, 1108.

I believe that the 1982 amendment which I have quoted was declaratory of existing law (see Biggins v. People (1880), 96 Ill. 381, 384 (strong dictum)). In any event five or more years of overdue taxes would never be “satisfied by a bid of *** $143” (97 Ill. 2d at 443) because the county itself is free to bid at such a sale for purposes of driving the price upward or of purchasing the property to offer at the next scavenger sale if the bids it receives are not to its liking, as well as because of important statutory safeguards incorporated in the 1978 amendments to the Act. These amendments require, except in the case of single-family residential units, that the amount to be paid for redemption be at least equal to all delinquent taxes on the property at the time of the sale. (Ill. Rev. Stat. 1979, ch. 120, par. 716a.) The amendments also provide that no certificate of purchase shall be issued to any person unless he executes and delivers to the county clerk an affidavit that he is not the party responsible for the payment of the delinquent taxes and is not bidding on the property as the agent for the party who is responsible.

However, the question of what the earlier law was can have no bearing on this case. It is now moot. That law obviously no longer applies to the parcels which are the subject of this appeal. (See People ex rel. Black v. Dukes (1983), 96 Ill. 2d 273; Madison Park Bank v. Zagel (1982), 91 Ill. 2d 231.) This court’s interpretation of what the earlier law was with regard to abatement can shed no light on the question this case poses, which is whether the Scavenger Act as it currently reads is mandatory or directory for purposes of a scavenger sale which has yet to occur.

The majority opinion comes to the conclusion that the Act was directory prior to the amendment stating that the collector’s duty was mandatory largely as the result of its concern that to do otherwise might jeopardize the collection of the full or a substantial amount of tax debts that are overdue for more than five years. As there are no grounds for this fear under the present version of the Scavenger Act, which guards against such a possibility in so many words, there is no reason for saying, as the majority does, that the provision in the Act that the county collector “shall” apply for judgment for sale and that the circuit court “shall” give judgment after allowing a hearing on objections has other than a mandatory effect. I believe it would defeat the purpose of the Scavenger Act to hold it directory merely because the delinquencies in the instant case arose prior to the amendment of the Act. This is especially the case in view of the clear language of the amendment stating that the owner’s personal liability is not affected by confirmation of a sale. This language supports the conclusion that actions in debt filed before the effective date of the amendment would not abate in the event of a scavenger sale which occurs after the effective date, as the scavenger sale in this case must.

I believe that this appeal has been rendered moot for another reason — the amendment to the Scavenger Act which the majority emphasizes in concluding that the Act is currently mandatory and not directory. Regardless of the wording of the Act at the time the parcels in question were permitted to be withdrawn from the scavenger sale, the amendment which the majority emphasizes explicitly states that it is the mandatory duty of the collector to include in the application for the scavenger sale all properties on which taxes have gone unpaid for five or more years. Because the parcels which are the subject matter of this proceeding and which were removed from a scavenger sale several years ago on the application of the collector and have remained in status quo pending the resolution of this case fall into that category, it will be mandatory, in view of the amendment, for the collector to include them in the next scavenger sale. I do not, therefore, understand how anything worthwhile is accomplished by quarreling over whether the Scavenger Act was mandatory or directory at the time the parcels in question were withdrawn from the previous sale when they clearly must be included in a future sale. The sensible thing to do, as I see it, is to dismiss this appeal as moot and permit the current law to operate on the parcels in question, as it was intended to do. People ex rel. Black v. Dukes (1983), 96 Ill. 2d 273; Madison Park Bank v. Zagel (1982), 91 Ill. 2d 231.

The majority finds support for its position that prior to the amendment the Scavenger Act was not mandatory by pointing out that the amendment, although it made the duties of the collector mandatory by explicit language, did not use the same explicit language in describing the duties of the circuit court. The majority therefore postulates that since after the amendment the word “shall” is retained, unaccompanied by further mandatory language, in describing the function of the circuit court, the word “shall” wherever used in the Scavenger Act prior to its amendment was merely directory. The duty of the court, however, as set forth in the statute both prior and subsequent to the amendment, was to entertain objections of taxpayers and not objections of the collector. Once the circuit court decides that the objections of the property owner lack merit, it is and always has been the court’s obligation to follow the statute and “give judgment for *** sale” (Ill. Rev. Stat. 1979, ch. 120, par. 716a). To that extent, apart from whatever the statute might say, the circuit court judge is under a mandatory obligation to follow the law as set forth in the Act, for he is sworn to uphold the law. Further language in the statute making his duties mandatory would be surplusage and therefore unnecessary.

While perhaps the following discussion is academic in view of the amendments to the Scavenger Act discussed by the majority, as well as in this dissent, I believe that the act as it existed when the collector withdrew the parcels in question was mandatory and the collector had no authority, even at that time, to withdraw the parcels from the sale.

The scavenger sale procedure involves a six-step process. First, the collector publishes an advertisement giving notice of the intended application for judgment for sale of parcels which have been tax delinquent for the requisite time. Second, the collector applies for judgment for sale. Third, after hearing objections, the circuit court gives judgment ordering a public sale to the highest cash bidder. Fourth, the collector ' offers the property for sale. Fifth, the collector within the time prescribed by the statute files his report of the sale with the circuit court. Sixth, and last, the circuit court is requested to confirm the sale.

While the precise issue presented by this appeal— whether a parcel once included in the order of judgment and sale can later and prior to sale be deleted at the collector’s request — was not decided in either People ex rel. Larson v. Rosewell (1980), 88 Ill. App. 3d 272, or In re Application of Rosewell (1981), 93 Ill. App. 3d 1106, the appellate court in both cases held that the particular stage of the Scavenger Act proceeding it was called upon to address was mandatory, and the majority does not appear troubled by those results. In the former case, the appellate court, dealing with the first stage in the proceeding, held that the collector did not have discretion to omit property from the advertisement prescribed by statute giving notice of the intended application for judgment for sale of parcels on which taxes were owing for five or more years. In the latter case, which involved the fifth stage of the scavenger-sale proceeding, the appellate court held that where a properly conducted scavenger sale had been held and a bid received, the collector had no discretion to withdraw the offer for sale to give the county board the opportunity to submit a bid on a reoffer of the property even though the sale had not yet been confirmed by the circuit court. In that circumstance the collector was obliged to report the sale to the circuit court and request confirmation. I agree with the appellate court conclusions in Larson and Application of Rosewell that the first and fifth steps of the scavenger sale process are mandatory.

“Generally, the use of the word ‘shall’ is regarded as indicative of a mandatory intent” (People v. Youngbey (1980), 82 Ill. 2d 556, 562; see Andrews v. Foxworthy (1978), 71 Ill. 2d 13, 21). I find persuasive the fact that the Scavenger Act employs the word “shall” at the beginning of each step in the instructions for carrying out a scavenger sale except for the final step relating to application to the court for confirmation of the sale. By prefacing its description of each of the first five procedures with the word “shall,” and in adopting the scavenger sale as a method of returning tax-delinquent property to the tax rolls so that it might become revenue producing, the legislature demonstrated its intention to adopt a mandatory procedure. Looking to the purpose of the scavenger-sale legislation, I find nothing to suggest that the word “shall,” as repeatedly employed in the statute, should be regarded as indicating other than a mandatory intent.

In one of the provisions of the Scavenger Act the word “shall” is used twice in the same sentence. The provision in question reads: “All such lands and lots shall be offered for sale in consecutive order as they appear in the delinquent list and the County Collector shall file his report of sale in the Court within 30 days of the date of sale of each tract of land or lot.” (Emphasis added.) (Ill. Rev. Stat. 1981, ch. 120, par. 716a.) There appears to be no justification for offering parcels included in the scavenger sale in any order other than the one provided by the Act, that is in consecutive order as they appear in the delinquent list. In fact, orderly disposition demands such a procedure. I believe this compels us to construe the word “shall” as first used in the above-quoted provision as mandatory, and it does not make sense to interpret the word as mandatory as used in one part of a sentence or statute and directory as used in another portion. “Where a word is so used in one portion of a statute as to have a clearly defined meaning, the same word when used in another portion of the same statute” should be given the same meaning unless something in the context indicates the legislature intended the contrary. (People v. Talbot (1926), 322 Ill. 416, 422; see Moran v. Katsinas (1959), 16 Ill. 2d 169, 174; People ex rel. Lipsky v. City of Chicago (1949), 403 Ill. 134, 142; Lawton v. Sweitzer (1933), 354 Ill. 620, 625; 82 C.J.S. Statutes sec. 348, at 728-29 (1953).) As there is no indication to the contrary, I would apply a consistent interpretation. It would make little sense to construe as directory rather than mandatory the provision that the collector “shall” apply for judgment for sale and that the court “shall” give judgment after hearing objections, where the word “shall” has, as I have pointed out above, already been held by the appellate court in People ex rel. Larson and in In re Application of Rosewell to carry its ordinary mandatory meaning when' used eight sentences before and four sentences after that provision in the same statute, and nothing in the context of the Revenue Act as a whole indicates otherwise.

In view of the purpose the legislature was seeking to accomplish, there is no reason for construing the word “shall” as if it were “may.” To do so would make of the scavenger sale merely an alternative device for attacking tax delinquency instead of what I believe the legislature intended it to be — an ultimate procedure for clearing up delinquencies and restoring property to the tax rolls. The Scavenger Act provides that the remedy it affords is “in addition to other remedies for the collection of delinquent taxes.” (Ill. Rev. Stat. 1981, ch. 120, par. 716a.) As I interpret this provision it means that the collecting authorities have discretion to pursue other avenues for collection until taxes become delinquent for five years. The collector is not, of course, required to wait for five years to obtain a judgment for unpaid taxes. He can proceed at any time after forfeiture. When the five-year point is reached, however, it becomes mandatory to proceed under the Scavenger Act as the most decisive step in combating the tax delinquency. It appears to me that the intention of the legislature was to take decisive action through a scavenger sale in dealing with properties which have remained delinquent for more than five years.

If discretion were vested in the collector to decide when and what parcels should be included in the scavenger sale or if discretion could be exercised by the court other than at the time it hears objections of the property owners or at the time its confirmation is requested, the purpose the legislature had in mind would be completely contravened. The Act provides no standards for the collector to follow if his responsibilities under the Act are discretionary rather than mandatory. Allowing the collector uncontrolled discretion in deciding which tax-delinquent parcels to include and which to exclude would open the door to the possibility of discrimination among various owners, a result the legislature obviously could not have intended, and one which would not benefit the public. The collector would be free to permit property owners he preferred, many of whom might be judgment-proof, to continue to pocket the income from their properties, while they are allowed to continue to ignore their duty to pay real estate taxes by not being included in the scavenger sale. And even assuming that the State’s Attorney has prudently investigated and decided prior to instituting suit that the proposed defendant is not judgment-proof, the State’s Attorney may have reached an erroneous conclusion, and in any event this is no guarantee that the assets of the proposed defendant may not be dissipated during the pendency of the personal action. I do not regard such an arrangement as in the public interest when measured against the alternative that including the delinquent property in the scavenger sale might succeed in returning it to the tax rolls without in any way endangering any actions in debt the collecting authorities may choose to bring in view of the recent amendment referred to above. Problems with in personam actions to collect delinquent taxes were outlined in the law review article cited in the majority opinion, where the author observed:

“There are a number of unique problems with suing in personam. An obvious concern is for fairness on the part of County officials in choosing who, out of thousands of delinquents, will be sued in this way. Other difficulties involve adequate service of process and the legal ability to satisfy a judgment by reaching the personal assets of the beneficiaries of a land trust.” J. Lawlor, Real Property Tax Delinquency and the Rehabilitation of Multi-Family Housing Stock in Chicago, Rlinois: The Role of the Collection Provisions of the Rlinois Revenue Act, 26 De Paul L. Rev. 1, 12 (1976) (hereinafter cited as Lawlor, Real Property Tax Delinquency).

These observations are borne out by inspection of the files of the clerk of the circuit court of Cook County in the cases involving the property the collector seeks here to exclude from the scavenger sale because of the pendency of those cases. Those files reveal that service was not obtained on almost half of the individuals whose property was excluded because of pending suits for the collection of taxes, even though the complaints in those suits were filed and the summons issued in 1977, 1979 and 1980 with approximately three-quarters of the filings occurring in the two earlier years. By way of illustration of the kind of problems encountered, in People v. Exchange National Bank, No. 79 CO 5172, a case in which only a bank was named as defendant, the summons was directed to the bank at 6848 South Stony Island, Chicago, Illinois, an address at which the bank was never located. The summons in that case has not been served to this day. In both People v. Hutter, No. 79 CO 5035, and People v. Routt, No. 77 CO 2010, the circuit court clerk’s files reveal that the property owner had moved to another State and had never been served. And in People v. Spencer, No. 79 CO 5134, the summons was directed to a nonexistent address and no other address was provided for service.

In addition, the collector does not appear to have been consistent in his choice of defendants in cases where the property was held in trust by a bank in years in which taxes on it were unpaid: in some instances the bank alone was sued, while in others the beneficiary was named as a defendant. The explanation for this difference in treatment is probably that the collector or the State’s Attorney was unable to discover who the beneficiary was. This explanation brings into question the accuracy of the majority’s statement that “[t]he State’s Attorney, prior to the institution of the Scavenger Act proceedings, must have been satisfied that the actions in debt against the objectors involved here would be productive” (97 Ill. 2d at 448). Because this court has held that the trustee of a land trust is not liable for unpaid taxes (People v. Chicago Title & Trust Co. (1979), 75 Ill. 2d 479), the collector presumably would have sued the beneficiary and not the trastee had he known the identity and address of the former. In the frequent instances in which the trustee alone was sued and the State’s Attorney by interrogatories elicited the name of the beneficiary from the trustee, it is obvious that the State’s Attorney, before filing the suit, did not know either who the beneficiary was or where he resided or both, and he therefore did not have enough information to satisfy himself that the action “would be productive.”

More importantly, the observations contained in the law review article from which I have quoted above, combined with an examination of the circuit court clerk’s files in the cases involving property the collector seeks to exclude from the scavenger sale, give me little confidence that orderly enforcement of the tax laws would be possible were the collector to rely primarily on in personam actions when taxes remain unpaid for more than five years, as he is free to do under the majority’s holding that the scavenger sale provisions are merely permissive. I am unwilling to attribute this intent to the legislature, particularly in view of its repeated use of the word “shall” in the Scavenger Act.

The wording of section 275 of the Revenue Act is also helpful in construing the scavenger sale provision. Section 275 employs the word “may” in referring to the county board’s authority to bring actions in debt to recover delinquent taxes. The use of that word indicates the legislature intended actions in debt as a permissible but discretionary means of recovering tax delinquencies. By way of contrast, the repeated use of the word “shall” with respect to property subject to sale under the Scavenger Act demonstrates the unambiguous intent of the legislature that properties be offered for sale after remaining delinquent for five years.

The collector argues that the scavenger sale can be had at any time after the action in debt proves unsuccessful, but this argument is answered by the Scavenger Act itself, which provides, as set forth above, that delinquent parcels “shall be offered for sale in consecutive order as they appear in the delinquent list.” This requirement can only be interpreted to mean that once property becomes tax delinquent for more than five years, it must be offered for sale each year until it is sold. It does not contemplate that the offer of a parcel for sale may be deferred until the collector or the county board has pursued other methods of collection.

The majority also observes that the Scavenger Act, if applied as mandatory, conflicts with article II, section 1, of the Illinois Constitution by directing the judiciary as to how cases must be decided, a violation of the separation-of-powers provision. This conclusion misconceives the limited role of the judiciary in a scavenger-sale proceeding.

A scavenger sale is similar to a foreclosure proceeding where the property subject to the sale is sold to the highest bidder. The Scavenger Act provides safeguards against the collector obtaining judgment against nondelinquent real estate which he arbitrarily chooses, thereby protecting the property owner against being deprived of his properly without due process of law. The owner’s due process rights, both substantive and procedural, are guaranteed by jurisdictional prerequisites which the circuit court is authorized and expected to enforce. The collector must first establish that the property has been tax delinquent for at least five years. Next, the property owner must receive notice and be given an opportunity to object and have a hearing on his objections. It is only if the court finds that the required delinquency exists and concludes that the property owner has no valid defenses to inclusion of his property in the scavenger sale that the court is required to apply the law and direct that the sale proceed. By that stage of the proceeding the court has fulfilled its role as guardian of the due process rights of the property owner.

The Scavenger Act does not tell the circuit court how it must decide any proceeding relating to property which the taxing authorities are mandated to sell under the Act. It merely sets forth mandatory prerequisites to a foreclosure sale. Once the court decides these are met, it then becomes the court’s responsibility to enter an order directing the sale to proceed. The statutory language directing that “the court shall give judgment for sale” becomes operative only after the court has found that the requirements for a sale under the Scavenger Act exist and that the collector has discharged his mandated duties under the Act.

People ex rel. County Collector v. Jeri, Ltd. (1968), 40 Ill. 2d 293, supports this view. That case involved an application for a tax deed which the trial court refused to issue. The reason for the refusal was the taxpayer’s failure to attach a transcript of evidentiary findings to the court order as the statute required. The taxpayer’s argument was that this requirement violated the separation-of-powers provision. The court rejected the argument, stating:

“[Pjroceedings relating to tax sales, redemptions and deeds are entirely statutory in origin and nature. The section 266 amendment *** is but one of many statutory conditions upon which issuance of a tax deed is predicated. This requirement does not purport to direct how a court should decide cases nor does it circumscribe the power of a judge to determine facts and apply the law to them.” (40 Ill. 2d 293, 301-02.)

Similarly, the Scavenger Act does not circumscribe the power of the court to determine facts and apply the law to them. In fact it contemplates that, at an early stage of the proceeding, the court will perform that very function. In addition, the Act provides that at the end of the proceedings, in confirming the sale, the court shall determine that there has been full compliance with the requirements of the statute.

The Scavenger Act was designed to effect the public policy of filling the public treasury at minimum expense to citizens generally. Statutes of this sort are usually given a mandatory construction when phrased in language which would permit it, on the theory that a construction of the statute as permissive only would defeat its purpose. (State ex rel. Snow v. Farney (1893), 36 Neb. 537, 54 N.W. 862 (tax statute similar to Scavenger Act); State ex rel. Robinson v. King (1974), 86 N.M. 231, 522 P.2d 83; see generally 2A Sutherland, Statutory Construction secs. 57.03, 57.04, 57.14, and especially sec. 57.20 (4th ed. 1973).) If inclusion in a scavenger sale is left to the discretion of the county collector, there would be no assurance of a remedy against a taxpayer who is delinquent for more than five years, in view of the difficulties I have already mentioned with regard to service of process as well as determining whether a suit will be productive, and in light of the prosecuting authorities’ inability to proceed simultaneously against the literally thousands of tax delinquents who are candidates for civil suits for recovery of overdue taxes at any one time. (See Lawlor, Real Property Tax Delinquency, 26 De Paul L. Rev. 1, 12 (1976).) This would not comport, in my opinion, with the legislative judgment that the Scavenger Act is needed to provide a speedy and efficient remedy against delinquent taxpayers and to return delinquent properties to the tax rolls at the earliest opportunity. This is indicated by the fact that the period of delinquency before a property becomes eligible for a scavenger sale has been reduced by the legislature from 10 years to five. (Compare Ill. Rev. Stat. 1981, ch. 120, par. 716a (five years’ delinquency sufficient to trigger a scavenger sale), with Ill. Rev. Stat. 1977, ch. 120, par. 716a (10 years’ delinquency required).) The purpose behind this change was explained by Senator Hynes, now assessor of Cook County and then President of the Senate, as follows:

“[The amendment] is vital because it is going to end up saving substantial amounts of money for local governments and for the taxpayers especially in urban areas, and more importantly, it is going to help with the revitalization of our cities. At the present moment, many of these parcels of property are tax delinquent. They are unused and in fact, are unusable and this will reduce by five years the period of time necessary to get these properties back on the tax rolls and make them usable ***.” Transcript of 80th General Assembly Regular Session, at 41 (June 22, 1978).

I believe that a mandatory construction of the Act is necessary to effect its purpose, and I therefore dissent.