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Illinois

Tax Sales

In re Application of the County Collector (Devon Bank v Miller), 397 Ill App 3d 535, 921 NE2d 462, 336 Ill Dec 848 (1st D, 2009).

Facts:Devon Bank petitioned to set aside a 2003 tax deed issued to Checkmate Acquisitions for one of its properties because it never received notice of the sale. Miller argued that because he was abona fidesubsequent purchaser, his right to the property superseded that of Devon.

Devon Bank owned the property since 1982. Checkmate Acquisitions, Inc. successfully bid on the property at the Cook County Collector's 2001 scavenger tax sale. In March of 2003, the county issued a tax deed to Checkmate, who then conveyed it to Michael Anchetta and Rene Mendoza. Anchetta and Mendoza did not record their deed until December 14, 2004, after they had already sold the property to Bruce Miller. Miller recorded the deed on December 16, 2004.

Devon filed suit in March of 2005, alleging that it received no notice of the tax sale or the issuance of the tax deed. Notice had been given to Marquette Expl. and PMG Enterprises of Chicago, Inc.

Checkmate's attorney searched the Chicago Title Insurance Company's computerized tract index and determined that PMG Enterprises was the party entitled to notice. The attorney relied solely on that information and never consulted the public grantor-grantee index, despite a disclaimer at the bottom of the search printout stating that it should not be relied on in place of the public records. In addition, Checkmate's attorney used an incorrect legal description when he ran the search, which included several lots in addition to the one it purchased.

The circuit court denied Devon's petition and found that Checkmate did not know the information it obtained regarding the property's ownership was incorrect.

Holding:Reversed and remanded. The circuit court never acquired jurisdiction over Devon because the notice requirements of the Property Tax Code were not met. Because the court never acquired jurisdiction, the judgment it entered was void and could be collaterally attacked under section 2-1401(f) of the Code of Civil Procedure. Section 22-45(4) of the Illinois Property Tax Code allows relief from a tax deed under 2-1401(f) where a party with a recorded interest and whose whereabouts can be readily ascertained did not receive any notice whatsoever of the sale. Devon's interest in the property was on record and its whereabouts could have been readily ascertained. Consequently, publication was insufficient to notify the bank of the sale.

Furthermore, the appellate court concluded that Miller was not a bona fide subsequent purchaser because he had constructive notice of another's outstanding interest in the property. Anchetta and Mendoza never legally recorded their interest. Thus, Miller's title insurance policy actually stated that Checkmate was the owner of the property, which should have been sufficient to put him on notice that further inquiry into the property's ownership was required. Consequently, Miller's interest in the property did not supersede Devon's.

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[Last update: 5-26-10]