                           ILLINOIS OFFICIAL REPORTS
                                         Appellate Court




                 United Legal Foundation v. Pappas, 2011 IL App (1st) 093470




Appellate Court            UNITED LEGAL FOUNDATION, Plaintiff-Appellant, v. MARIA
Caption                    PAPPAS, Individually and as Cook County Treasurer and Ex Officio
                           Collector; DAVID ORR, Individually and as Cook County Clerk; THE
                           COUNTY OF COOK; Z FINANCIAL, LLC; and KEITH MOLL,
                           Defendants-Appellees.


District & No.             First District, Second Division
                           Docket No. 1–09–3470


Filed                      May 31, 2011


Held                       In an action by a property owner challenging the sale of the delinquent
(Note: This syllabus       taxes on its property, the trial court properly dismissed the owner’s
constitutes no part of     complaint, including counts seeking a writ of mandamus directing
the opinion of the court   defendant tax purchaser for the year 2004 to pay prior delinquent taxes
but has been prepared      pursuant to section 21–240 of the Property Tax Code, which provides that
by the Reporter of         the purchaser of delinquent taxes must inform the county within 10 days
Decisions for the          from the date the purchaser learned of the prior delinquent taxes whether
convenience of the         the purchaser would pay the prior taxes, since the time requirement is
reader.)
                           directory, not mandatory, and does not afford a basis for an attack upon
                           the validity of the sale of delinquent taxes; therefore, no basis existed to
                           reverse the dismissal of the counts of the complaint based on section
                           21–240.


Decision Under             Appeal from the Circuit Court of Cook County, No. 06–COMS–11; the
Review                     Hon. Patrick McGann, Judge, presiding.


Judgment                   Affirmed.
Counsel on                 Cook, Revak & Associates, of Chicago (Rufus Cook and Barbara Revak,
Appeal                     of counsel), for appellant.

                           Hinshaw & Culbertson LLP, of Chicago (Stephen R. Swofford, David E.
                           Zajicek, and Leigh C. Bonsall, of counsel), for appellees Z Financial,
                           LLC and Keith Moll.

                           Anita M. Alvarez, State’s Attorney, of Chicago (Patrick T. Driscoll, Jr.,
                           Prathima Yeddanapudi,


Panel                      JUSTICE KARNEZIS delivered the judgment of the court, with opinion.
                           Presiding Justice Cunningham and Justice Harris concurred in the
                           judgment and opinion.




                                             OPINION

¶1           Plaintiff United Legal Foundation (United) appeals from the circuit court’s orders in
        favor of defendants Maria Pappas, individually and as Cook County treasurer and ex officio
        collector; David Orr, individually and as Cook County clerk; the County of Cook; Z
        Financial, LLC; and Keith Moll. United contends on appeal that its complaint against
        defendants for violations of the Property Tax Code (35 ILCS 200/1–1 et seq. (West 2006))
        should not have been dismissed and its claim for breach of contract should have been decided
        in its favor. For the following reasons, we affirm the circuit court’s orders.

¶2                                             Background

¶3          This case arose as a result of Z Financial’s purchase of United’s 2004 delinquent property
        taxes for certain property at the county’s annual tax sale. Z Financial ultimately purchased
        those taxes for $49,687.10, with an 18% interest penalty. United filed a complaint seeking
        to vacate Z Financial’s purchase; however, the circuit court ultimately found in Z Financial’s
        favor. United appeals from the court’s orders.
¶4          In Illinois, where a property has delinquent taxes, those taxes will be sold at an annual
        tax sale. The buyers will base their bids on what penalty, or interest rate, they will accept
        from a property owner who subsequently seeks to redeem the property. The maximum
        penalty or interest rate that can be bid is 18%, which will be applied to the property owner’s
        tax debt. If the winning bid has a penalty of 18%, the bidder becomes known as an “18
        percenter,” which means that after the bidder pays any prior delinquent taxes, the bidder will

                                                 -2-
       obtain a tax certificate that earns 18% interest for each six-month period that passes. If the
       property owner wants to redeem the property, the owner owes the bidder the amount of the
       tax debt plus 18% for every six-month period that has passed, or 36% per annum. If a bidder
       fails to pay any prior delinquent taxes, the bidder receives a certificate representing a lien that
       has only a 5% interest rate per year and becomes known as a “5 percenter.”
¶5         United is an Illinois charitable corporation, founded in 1969. It operates as a public
       interest law firm, undertaking impact litigation that affects minorities. Rufus Cook was
       involved in United’s creation and served as its attorney during the relevant time period. In
       1991, United acquired the property at issue in this case, which is known as the Ridgeland
       Club, located at 7330 South Ridgeland Avenue, in Chicago. The property is also known as
       parcel 10 and has the property index number (PIN) 20–25–124–010–0000. United operated
       the club as a banquet facility and conference center, and it housed United’s offices as well.
       Ultimately, in 2006, United sold the property to Jackson Park Pinnacle Plaza (Jackson Park).
¶6         Prior to the sale of the property to Jackson Park, United’s board of directors directed
       Cook to attempt to either reduce the property’s taxes or to have the property declared tax
       exempt. In May 2003, United filed a property tax-exemption application with the Cook
       County board of review seeking to declare the property tax exempt because it was being used
       for charitable purposes.
¶7         In 2003, defendant Maria Pappas, as county treasurer/collector, sought to sell the lien for
       delinquent taxes on the property at the 2003 tax scavenger sale. The delinquent taxes were
       for tax years 1990-2001. United objected to the proposed sale, and on November 14, 2003,
       the circuit court entered an order that the property should not be sold because of United’s
       pending tax-exemption application.
¶8         On November 23, 2005, Pappas again sought to sell the lien for delinquent taxes on the
       property at the 2005 tax scavenger sale. The delinquent taxes were for tax years 1990-2001
       and 2002-03. United again objected to the proposed sale, and the circuit court entered an
       order on April 13, 2006, vacating the sale with respect to tax years 1990-2001, but upholding
       the sale with respect to tax years 2002-03.
¶9         In 2006, Pappas sought to sell the lien for the 2004 delinquent taxes on the property at
       the 2006 tax scavenger sale. This sale is the sale at issue in this case. Z Financial ultimately
       purchased those taxes for $49,687.10, with an 18% interest penalty on June 16, 2006.
¶ 10       Z Financial is in the business of purchasing delinquent property taxes at annual tax sales.
       Prior to purchasing the lien, Keith Moll, a manager at Z Financial, researched the property
       and believed that it did not have any prior delinquent taxes, other than for the 2004 tax year.
       However, after purchasing the 2004 delinquent taxes, Moll received documentation from the
       county on July 28, 2006, that United owed $993,889.92 in prior taxes. As a result, Z
       Financial could pay the prior taxes and become an “18 percenter” and eventually obtain a
       deed to the property or not pay the prior taxes and become a “5 percenter.” Moll testified that
       becoming a “5 percenter” was almost “worthless.”
¶ 11       According to section 21–240 of the Property Tax Code (35 ILCS 200/21–240 (West
       2006)), Z Financial had 10 days from the date it learned of the prior taxes to inform the
       county whether it would pay the prior taxes and become an “18 percenter” or would not pay

                                                  -3-
       them and become a “5 percenter.”
¶ 12       While Moll was deciding what course of action to pursue, Cook learned that Z Financial
       had purchased the 2004 delinquent taxes. Cook contacted Moll on August 21, 2006, and told
       Moll that United had entered into a contract to sell the property to Jackson Park and wanted
       to pay the delinquent taxes through an escrow. Moll told Cook that he would be willing to
       sell Z Financial’s position for $56,000. Cook stated that he would have to inform United of
       the offer; however, Cook never did and contacted Moll again about an hour later. Cook and
       Moll then agreed on the sum of $50,000. Moll subsequently became concerned that if the
       prior taxes on the property were not paid soon, the county would make his interest a “5
       percenter,” which was undesirable. Therefore, on August 23, 2006, Moll sent Cook a fax
       stating that Z Financial’s offer to sell its interest for $50,000 would be withdrawn unless
       certified funds were paid to Z Financial by noon that day. Cook did not receive the fax until
       after noon and contacted Moll. Moll informed Cook that his employees were on their way
       to pay the prior delinquent taxes on the property. Moll was unable to reach the employees
       and they returned to the office having paid the priors, making Z Financial an “18 percenter.”
¶ 13       United filed its verified first amended complaint against defendants on September 27,
       2006, seeking to invalidate the sale to Z Financial. The multicount complaint alleged
       generally that the property’s 2004 delinquent taxes should not have been sold to Z Financial
       due to several violations of the Property Tax Code. United also alleged that because of the
       sale, it incurred $200,000 in damages, in addition to legal fees and costs.
¶ 14       Defendants filed motions to dismiss pursuant to sections 2–615 and 2–619 of the Code
       of Civil Procedure (735 ILCS 5/2–615, 2–619 (West 2006)). On January 22, 2007, the circuit
       court dismissed all counts except for count III, a breach of contract claim against Z Financial.
       Subsequently, the cause proceeded to trial on that count. After trial, the court issued an order
       on November 17, 2009, finding in favor of Z Financial. United appeals from both of the
       court’s orders.
¶ 15       Initially, we note that many of United’s contentions are very brief with little or no citation
       to legal authority as required by Illinois Supreme Court Rule 341(h)(7) (eff. July 1, 2008)).
       Rule 341(h)(7) requires appellant’s argument to contain “the contentions of the appellant and
       the reasons therefor, with citation of the authorities and the pages of the record relied on.”
       Rule 341(h)(7) also provides that “points not argued are waived.” Further, a reviewing court
       is entitled to have the issues clearly defined, with pertinent authority cited. Boeger v. Boeger,
       147 Ill. App. 3d 629, 631 (1986). Bare contentions without argument or citation to relevant
       authority do not merit consideration on appeal. Fitzpatrick v. ACF Properties Group, Inc.,
       231 Ill. App. 3d 690, 708 (1992). To the extent we are able to ascertain United’s contentions
       on appeal, we will address them. However, those contentions that do not meet the
       requirements of Rule 341(h)(7), we need not consider.
¶ 16       On appeal, United first contends the circuit court erred when it “failed to acknowledge”
       that the sale of the 2004 delinquent taxes was improper because the litigation regarding the
       1990-2003 delinquent taxes was still pending and had not been resolved.
¶ 17       Here, however, United does not argue how the 1990-2003 delinquent taxes precluded the
       sale of the 2004 delinquent taxes. The prior court orders upon which United relies precluded


                                                  -4-
       the sale of the prior tax years that were the subject of litigation. The 2004 taxes, which are
       at issue here, were never the subject of prior litigation. Therefore, United’s first contention
       is without merit.
¶ 18        Next, United contends the circuit court’s dismissal of counts I and II of its complaint was
       erroneous. Count I was directed against defendants Pappas and Orr, in their individual and
       representative capacities, and the County of Cook, and sought a mandamus directing
       defendants to strictly apply section 21–240 of the Property Tax Code, which required Z
       Financial to pay the prior delinquent taxes within 10 days of learning of the prior delinquent
       taxes from the county. Count II was directed against the same defendants as count I and
       sought “class action for injunctive relief and damages” and similarly alleged that defendants
       failed to strictly apply the 10-day time requirement in section 21–240 of the Property Tax
       Code. United maintains the circuit court’s determination that the time requirement in the
       Property Tax Code was directory rather than mandatory, as held in Hoffmann v. Stuckslager,
       48 Ill. 2d 262 (1971), should nevertheless not defeat its claims. United argues that in
       Hoffmann, the court’s rationale for holding the time requirement directory rather than
       mandatory was for the “protection of revenue,” which is not present here.
¶ 19        In Hoffmann, our supreme court examined the time requirement in the Revenue Act of
       1939 (Ill. Rev. Stat. 1965, ch. 120, par. 728), the predecessor to the Property Tax Code. The
       court held the time requirement was directory rather than mandatory, stating, “[s]o far as an
       owner of delinquent property is concerned, it is sufficient to conclude *** that the provisions
       for payment are directory and do not afford a basis for an attack upon the validity of the
       sale.” Hoffmann, 48 Ill. 2d at 267.
¶ 20        Despite United’s contention, we must follow our supreme court precedent and find that
       the 10-day time requirement in section 21–240 of the Property Tax Code is directory rather
       than mandatory. Therefore, the failure to strictly adhere to the time requirement cannot afford
       a basis for United to contest the validity of the sale to Z Financial. We take this opportunity
       to reaffirm our supreme court’s holding in Hoffman that “[s]o far as an owner of delinquent
       property is concerned, it is sufficient to conclude *** that the provisions for payment are
       directory and do not afford a basis for an attack upon the validity of the sale.” Hoffmann, 48
       Ill. 2d at 267. Accordingly, we find no basis to reverse the court’s dismissal of counts I and
       II of United’s complaint.
¶ 21        Next, United contends the circuit court’s dismissal of defendant Cook County was
       reversible error. Yet, United’s contention only consists of one paragraph in its brief that fails
       to argue how the court’s dismissal of Cook County was reversible error. We are unable to
       address this contention. See Ill. S. Ct. R. 341(h)(7).
¶ 22        Next, United contends the circuit court’s dismissal of the fraud count against the County
       defendants was improper. Again, United fails to argue how the court’s dismissal of the fraud
       count against the county defendants was improper. As such, we are unable to address this
       contention. See Ill. S. Ct. R. 341(h)(7).
¶ 23        Next, United argues the circuit court’s dismissal of the fraud count against Z Financial
       was improper. However, United’s bare bones argument does not cite to any legal authority
       to support its position that the court’s dismissal was improper. We need not address this


                                                 -5-
       contention. See Ill. S. Ct. R. 341(h)(7).
¶ 24       Next, United contends the evidence establishes there was a contract between United and
       Z Financial and Z Financial committed an anticipatory breach of the contract. United also
       contends it suffered damages as a result of the breach.
¶ 25       The circuit court determined that a contract had not been formed between Moll and Cook
       because Cook did not have authority to enter into a contract to buy the 2004 delinquent taxes
       from Z Financial. The court found that Cook’s authority was limited to obtaining a tax-
       exempt status or a tax reduction for the property.
¶ 26       In an agency relationship, the principal can be legally bound by action taken by the agent
       where the principal confers actual authority on the agent. Granite Properties Ltd.
       Partnership v. Granite Investment Co., 220 Ill. App. 3d 711, 714 (1991). Actual authority
       can be express or implied. Buckholtz v. MacNeal Hospital, 337 Ill. App. 3d 163 (2003). The
       existence of an agency relationship is a factual question that is determined by the trier of fact.
       Granite Properties Ltd. Partnership, 220 Ill. App. 3d at 714. The party alleging an agency
       relationship must prove it by a preponderance of the evidence. Granite Properties Ltd.
       Partnership, 220 Ill. App. 3d at 714.
¶ 27       Here, the record establishes that Cook was given authority by United’s Board to attempt
       to eliminate or reduce the taxes on the property. It is United’s burden to prove that Cook had
       authority to enter into a contract with Z Financial to buy its position with respect to the 2004
       taxes. United has not done so. We find no evidence in the record to support the finding of
       an agency relationship with respect to Cook’s authority to contract with Z Financial.
       Therefore, we cannot find that a valid contract between United and Z Financial was formed.
       Additionally, it follows that if a contract was never formed, there can neither be an
       anticipatory breach of contract nor damages. United has not established any error on the part
       of the circuit court.
¶ 28       Again, we note that several of United’s additional arguments are bare contentions without
       argument or citation to relevant authority in violation of Rule 341(h)(7), and we need not
       consider them.
¶ 29       Accordingly, we affirm the judgment of the circuit court.

¶ 30       Affirmed.




                                                  -6-
