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                                     Appellate Court                            Date: 2018.02.26
                                                                                10:25:00 -06'00'




                  Friendship Manor, Inc. v. Wilson, 2017 IL App (3d) 160391



Appellate Court          FRIENDSHIP MANOR, INC., an Illinois Not-for-Profit Corporation,
Caption                  Plaintiff-Appellant, v. LARRY WILSON, Not Individually But in His
                         Capacity as Supervisor of Assessments for Rock Island County,
                         Illinois, Defendant-Appellee (Rock Island-Milan School District No.
                         41, Intervenor-Appellee).



District & No.           Third District
                         Docket No. 3-16-0391


Filed                    October 11, 2017
Modified upon denial
of motion to clarify     November 28, 2017



Decision Under           Appeal from the Circuit Court of Rock Island County, No.
Review                   14-MR-919; the Hon. Clarence M. Darrow, Judge, presiding.



Judgment                 Appeal dismissed.


Counsel on               Patrick J. Hanlon, of Hanlon Vinson, LLP, and Floyd D. Perkins, of
Appeal                   Nixon Peabody, LLP, both of Chicago, for appellant.

                         John L. McGehee, State’s Attorney, of Rock Island (Patrick Delfino,
                         of State’s Attorneys Appellate Prosecutor’s Office, and Christopher E.
                         Sherer and Matthew R. Trapp, of Giffin, Winning, Cohen & Bodewes,
                         P.C., of Springfield, of counsel), for appellee Larry Wilson.
                               Robert J. Noe, William J. Snyder, and Daniel F. Hardin, of Bozeman,
                               Neighbour, Patton & Noe, LLP, of Moline, for intervenor-appellee
                               Rock Island-Milan School District No. 41.



     Panel                     JUSTICE O’BRIEN delivered the judgment of the court, with
                               opinion.
                               Presiding Justice Holdridge and Justice Schmidt concurred in the
                               judgment and opinion.


                                                OPINION

¶1         The plaintiff, Friendship Manor, Inc., sought a declaration that it was qualified to receive a
       general homestead exemption under section 15-175(f) of the Property Tax Code (35 ILCS
       200/15-175(f) (West 2014)) for the tax year 2014 and future years. The circuit court granted
       summary judgment to the defendant Larry Wilson, the supervisor of assessments, finding that
       Friendship Manor was not entitled to the exemption. Friendship Manor appealed.

¶2                                                 FACTS
¶3          Friendship Manor, Inc., is an Illinois not-for-profit corporation, with its principal place of
       business located in Rock Island County, Illinois. It operates a licensed life care facility, as
       defined and licensed by the Life Care Facilities Act (210 ILCS 40/1 et seq. (West 2014)). As a
       life care facility, Friendship Manor contracts with the individuals to whom it provides housing,
       maintenance, and nursing, medical, or personal care services. The individuals reside in private
       “apartment homes” at Friendship Manor. Friendship Manor pays real estate taxes to the local
       taxing authorities and allocates each of its residents a portion of the tax attributable to the
       resident’s “apartment home.” If a resident qualifies for and receives a tax exemption, then
       Friendship Manor reduces the resident’s share of the tax bill by an amount equal to the savings
       derived from the exemption. For many years, Friendship Manor applied for and received the
       general homestead exemption (35 ILCS 200/15-175 (West 2014)) and a senior citizens
       homestead exemption (35 ILCS 200/15-170 (West 2014)) pursuant to the Illinois Property Tax
       Code.
¶4          In 2014, Wilson, the supervisor of assessments for Rock Island County, advised Friendship
       Manor that he had interpreted the general homestead exemption statute and determined that
       Friendship Manor, on behalf of its qualified residents, was not entitled to a general homestead
       exemption, as it did not meet the conditions for exemption under the language of section
       15-175(f) of the Property Tax Code (35 ILCS 200/15-175(f) (West 2014)). Wilson determined
       that the residents were not entitled to the homestead exemption because Friendship Manor was
       not considered a cooperative.
¶5          On October 20, 2014, Friendship Manor filed a nonfarm property valuation assessment
       complaint with the Rock Island County Board of Review. While that was pending, Friendship
       Manor filed the instant complaint for declaratory relief against Wilson, seeking a declaration
       that the residents had been improperly denied homestead exemptions in 2014 and a declaration

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       that Friendship Manor was indeed a cooperative whose residents are eligible for the homestead
       exemption. Wilson filed a motion to dismiss, arguing, inter alia, that Friendship Manor lacked
       standing to bring the action, the tax code had been properly applied, and Friendship Manor had
       failed to exhaust its administrative remedies. The circuit court denied the motion to dismiss.
¶6         On December 10, 2015, Rock Island-Milan School District No. 41 filed a motion to
       intervene, arguing that if Friendship Manor was successful, the school district would be
       financially affected by the reduced amount of real estate taxes. The motion to intervene was
       granted. Thereafter, Wilson filed a motion for summary judgment, arguing that Friendship
       Manor was not entitled to relief. Friendship Manor and the school district also filed motions for
       summary judgment. The circuit court found that, whether or not Friendship Manor was
       considered a cooperative, in order for a life care facility to be eligible for a general homestead
       exemption under section 15-175(f) of the Property Tax Code, its residents had to have a legal
       or equitable ownership in the life care facility. Since the Friendship Manor residents did not
       have ownership of record in the facility, no general exemption under section 15-175 of the
       Property Tax Code was warranted. Thus, the circuit court entered judgment in favor of Wilson
       and the school district and against Friendship Manor. Friendship Manor appealed.

¶7                                               ANALYSIS
¶8          Wilson argues that the circuit court never had jurisdiction because Friendship Manor filed
       a declaratory judgment complaint rather than a statutory tax objection complaint. Wilson
       contends that the Property Tax Code is a comprehensive statute and the exclusive remedy for
       real estate tax disputes. Friendship Manor argues that it filed a declaratory judgment action
       because the assessor’s actions were unauthorized by law. Subject-matter jurisdiction is a
       question of law that this court reviews de novo. Blount v. Stroud, 232 Ill. 2d 302, 308 (2009).
¶9          Generally, the existence of another remedy will not preclude bringing a declaratory
       judgment action. But declaratory relief is unavailable in revenue cases if the statute provides an
       adequate remedy. Board of Education of Park Forest-Chicago Heights School District No. 163
       v. Houlihan, 382 Ill. App. 3d 604, 609 (2008). With respect to property tax, the general rule is
       that a taxpayer is limited to first exhausting administrative remedies provided by statute
       beginning with the Board of Review—the remedy at law for an incorrect assessment—before
       seeking relief in the circuit court. The taxpayer then has the option of either appealing to the
       Property Tax Appeal Board (35 ILCS 200/16-160 (West 2014)) or filing a tax objection
       complaint in circuit court (35 ILCS 200/23-15 (West 2014)). Thus, the adequate remedy at law
       is to pay the taxes under protest and file a statutory objection. Millennium Park Joint Venture,
       LLC v. Houlihan, 241 Ill. 2d 281, 295-96 (2010).
¶ 10        Friendship Manor argues that this case falls under one of the exceptions to this rule: a
       taxpayer may seek equitable relief when the tax is unauthorized by law. See Millennium Park
       Joint Venture, LLC, 241 Ill. 2d at 295. Friendship Manor cites two cases, Fox v. Rosewell, 55
       Ill. App. 3d 860 (1977), and County of Knox ex rel. Masterson v. The Highlands, L.L.C., 188
       Ill. 2d 546 (1999), in support of its argument. However, in Fox, the plaintiff was challenging
       the constitutionality of a statute, and in County of Knox, the subject property was exempt from
       zoning regulations, so declaratory relief was proper. Friendship Manor does not argue that the
       general homestead statute was unconstitutional or that the property was exempt from taxation;
       it only argues that the assessor applied the statute incorrectly.


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¶ 11       We conclude that Friendship Manor was required to exhaust the administrative remedies
       provided by statute, namely a tax objection with the Board of Review, before filing an action in
       circuit court. Friendship Manor contends that Wilson waived the issue by not raising it as an
       affirmative defense, but subject-matter jurisdiction cannot be waived, stipulated to, or
       consented to by the parties, nor can it be conferred by estoppel. KT Winneburg, LLC v.
       Calhoun County Board of Review, 403 Ill. App. 3d 744, 747 (2010). Since Friendship Manor
       did not exhaust its administrative remedies before commencing this litigation, the circuit court
       lacked subject-matter jurisdiction. We find the order entered in the circuit court was void
       ab initio. See In re Marriage of Schlam, 271 Ill. App. 3d 788, 793 (1995) (orders entered by a
       court that lacks jurisdiction are void ab initio). Since the circuit court lacked jurisdiction, we
       likewise lack jurisdiction entertain this appeal. Thus, the challenged 2014 tax assessments
       stand, subject to the administrative tax objection proceedings.

¶ 12                                     CONCLUSION
¶ 13      The appeal from the judgment of the circuit court of Rock Island County is dismissed.

¶ 14      Appeal dismissed.




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