Interest On Taxpayers’ Property Valuation Judgment Appealable After Earlier-Filed Notice Of Appeal

Three corporate taxpayers disputed the amount of property taxes they owed Cook County, Illinois. So they sued the county collector for refunds plus interest. The taxpayers settled the property valuation part of their disputes, but left the interest issues (power to award, rate, and period the interest accumulated) for the trial court to decide. The trial court awarded the taxpayers interest at a favorable rate and period.

The Collector appealed before the trial court decided the interest rate to be applied to two of the property valuation judgments. The first question was whether the trial court had jurisdiction to award interest even though the Collector already appealed.

The general rule is that a trial court loses jurisdiction over a case as soon as a notice of appeal is filed. The chief exception to the rule is that a trial court still can issue orders that are collateral to the judgment. In this case, the Illinois Supreme Court ruled that the interest awards were collateral to the valuation judgments, so the trial court kept jurisdiction to award interest. Here’s how the supreme court explained it:

This award of judgment interest was not part of the judgment itself, but incidental thereto, and imposed on a specific sum contained in the underlying orders with a rate of interest set forth in the Code of Civil Procedure. Interest on the fixed judgment amounts simply allowed for the preservation of the economic value of the awards while the matter was stayed pending appeal. The judgment interest resulted from the stay requested by the collector, and like the stay order, it did not affect or alter the issue from which the collector filed her notices of appeal on August 13, 2007. Accordingly, we find the circuit court retained jurisdiction to enter the judgment interest awards on behalf of SBC and Newcastle [two of the taxpayers] after the notices of appeal were filed.

Having filed her notice of appeal before two of the interest awards were made, there also was a question of whether the appellate court had jurisdiction to consider those awards. The Collector had not filed a second notice of appeal nor amended her existing notice to include those awards. The Collector argued there still was appellate jurisdiction because she identified the questions in her docketing statement, the issues were fully briefed, and the taxpayers were not prejudiced.

No matter. The Illinois Supreme Court ruled there was no appellate jurisdiction for the later awards because the notice of appeal referred only to the earlier award, “an entirely different matter” than the interest awards that were made later.

Nor did it did matter, the supreme court ruled, that the questions were identified in the Collector’s docketing statement because “a docketing statement does not confer jurisdiction on the appellate court …”

The supreme court also addressed whether the Collector forfeited her right to dispute the earlier interest award because she had not objected to the award in the trial court. That “would generally result in forfeiture of the issue on appeal.” But the supreme court was most interested in resolving a conflict in the appellate courts over the proper measure of interest. So the court invoked its power to “overlook any forfeiture in order to provide a unified body of case law.”

Read the whole case, General Motors v. Pappas, No. 108893 (5/19/11), by clicking here.