Bigelow Group, Inc v Rickert (IL)

Taxation

Bigelow Group, Inc v Rickert, 377 Ill App 3d 165, 877 NE2d 1171, 315 Ill Dec 842 (2d D 2007).

Facts: Bigelow Group, Inc. (Bigelow), a housebuilder that sold homes to the individual plaintiffs, was in the practice of dividing its developments into several lots, dividing those lots into subparcels, building a home on each subparcel, and then selling the subparcels to its customers. The assessor would assign an individual property index number (PIN) to each subparcel upon recordation. The customers would later pay the full year's property tax bill for their respective parcels, but, at the closing of the sale, Bigelow would give its customers a credit for the portion of the year Bigelow had owned the property. In Kane County, if a parcel is divided after September 10 of a given year, the new PINs for the divided parcels do not become effective for taxation purposes until the next assessment year. Therefore, Bigelow would typically be required to pay the year's taxes for the entire lot, including taxes for any already-sold subparcels within the lot, when the property was sold after September 10.

In previous years, defendant David Rickert, Kane County Collector, accommodated Bigelow, and only Bigelow, by allowing tax payment by specification, a procedure by which taxpayers who own separate portions of a larger property, with a single PIN, may specify their individual tax liability for their portions of the parcel and pay their taxes separately. However, in 2004, Rickert stopped accepting payment by specification. Therefore, for any subparcels sold by Bigelow after September 10 of the previous year, Rickert sent Bigelow a bill for taxes on the undivided lots containing the subparcels. Bigelow then collected taxes from the homeowners in order to satisfy the tax liability on the property, but it did so only after several parcels were placed in a tax sale due to their tax delinquency and after interest and penalties on the delinquency had been incurred.

Bigelow brought action against Rickert, seeking an injunction against Rickert's practice of refusing to allow property tax payment by specification in connection with subdivided parcels and a declaration that Rickert's refusal to accept payment by specification violated the Property Tax Code and the state and federal constitutions. The circuit court granted summary judgment for Rickert and Bigelow appealed.

Holding: Affirmed. On appeal, Bigelow first contended that Rickert's refusal to allow payment by specification violated his duties under the Property Tax Code, because it constitutes his failure to make a policy to review requests for payment by specification. However, the appellate court held that Rickert does, in fact, have a policy regarding payment by specification—he does not allow it in any instance. Therefore, he is merely denying Bigelow's requests, rather than refusing to act on Bigelow's requests for payment by specification.

Bigelow also contended that Rickert's policy of refusing to accept payment by specification constituted an abuse of his official discretion, justifying judicial intervention. The court focused its inquiry on the issue of the extent of judicial review of a purely discretionary official decision, which only allows for judicial interference in cases of arbitrary or capricious use of official power. Absent some evidence of illegality, a court will not find an executive decision to be arbitrary and capricious and will not inquire further into the propriety of the reasoning behind the decision. Therefore, the appellate court held that Rickert's refusal to accept payment by specification was not arbitrary or capricious.

Bigelow's third argument on appeal was that Rickert fundamentally misunderstood payment by specification, because he equated it with partial payment. However, the court agreed with Rickert's description of payment by specification and found that such payment necessitates payment on a portion of a particular property and, therefore, it entails a partial payment of the tax on the property.

Finally, Bigelow contended that Rickert's policy of refusing payment by specification violates guarantees of due process and equal protection provided by the United States and Illinois Constitutions, because Rickert's policy bears no rational relationship to the state interest in collecting property taxes. Regarding the due process claim, the court found that Bigelow overlooked the fundamental differences between substantive due process review of an executive, as opposed to a legislative, action. When a plaintiff challenges a non-legislative action, the court must look to whether the property interest being deprived is "fundamental" under the Constitution. Here, Bigelow made no argument that the right to pay taxes by specification is fundamental and, therefore, their substantive due process argument failed. Regarding Bigelow's equal protection argument, the court must determine whether similarly situated persons are treated dissimilarly. Here, Rickert treats all taxpayers similarly, by not allowing payment by specification from anyone, and, therefore, Bigelow's equal protection argument failed.

Opinion Year: 
2008
Jurisdiction: 
Illinois
By: ATG Underwriting Department | Posted on: Thu, 07/03/2008 - 2:41pm