# Appendix — Lehnhausen v. Lake Shore Auto Parts Co.

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Appendix
- **Published:** January 1, 1973
- **Citation:** 410 U.S. 356

## Text

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Ross allege that they are natural persons and oper
as a partnership, a business which owns property, ¥
Weil and Sons, Inc., a corporation, alleges that it is th
owner of property situated in Cook County.

The complaint alleges that each of the plaintiffs is ag.
ing in a representative capacity on behalf of all othe,
similarly situated. The defendants are those State any
county officers who were named in the Lake Shore con.
plaint. The complaint alleges the adoption of article IX.4
and asserts various interpretations of that article, som
of which are advanced by all of the plaintiffs and other
by one or another of the plaintiffs. To this complaint th
defendant Lehnhausen, ‘Director of the Department of
Local Government Affairs, filed a motion to dismiss o
May 9, 1971. He also filed a “Petition for Instruction’
which recited that the Lake Shore and Maynard case
were pending in the Supreme Court of Illinois, asserted
that the issues in all of the three cases were substantially
the same, and that it “would appear to be a duplication
of effort for this Court to consider the issues involved in
the case at bar [the Shapiro case] while at the same tim
the Illinois Supreme Court has essentially the same issues
before it for consideration.’’ The petition for instructions
suggested that the Shapiro case be held in abeyance for
the determmation of the cases already pending befor
the Supreme Court. No order was entered with respect to
this petition. On May 19, 1971, a motion to strike was
filed in behalf of the defendant county officers. On May
28, 1971, an order was entered, by a judge other tha
the judge who heard the Lake Shore case, finding that
the action waS properly maintained as a class action and
that each plaintiff had standing to bring the action in its
~ own behalf and was a proper representative of the class

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he purported to represent. The order found that article
Ix-A “is free of the ambiguity and uncertainty of intend-
ment charged by the plaintiffs, and that its intendment
is clearly declared to prohibit the taxation of personal
property by valuation exclusively as to natural persons,

~ where that property is used, by them, for the personal

enjoyment of themselves and their families.’’ Except as
to the plaintiff Clemens K. Shapiro and members of his
class, the complaint was dismissed. All of the plaintiffs
in the Shapiro case have appealed from this judgment.

[1] The plaintiffs in the Maynard and Shapiro cases
justify the institution of their actions upon the ground
that there are deficiencies as to parties and as to legal
propositions in the Lake Shore case which might, with-
out the assistance which they volunteer to supply, pre-
clude the possibility of full consideration of the issues by
this court. That it is not necessary that each person or
group of persons favorably or unfavorably affected by a
legislative classification be made parties to an action
challenging the validity of that classification is‘ apparent.
Major cases involving discrimination of the sort here al-
leged have not required the presence, as parties, either in
person or by representative, of all those affected. See e. g.,
Lawrence v. State Tax Comm. of State of Mississippi
(1932), 286 U.S. 276, 52 S. Ct. 556, 76 L. Ed. 1102.

There are no factual issues in the present cases, and
the order of this court whick consolidated the Lake
Shore and Maynard cases provided: “Counsel may brief
and argue all issues as to the validity and effect of the
constitutional amendment known as Article [X-A of the
Constitution of 1870.” (See Hux v. Raben (1967), 38 Ill.
9d 223, 230 N.E. 2d 831.) Additional class actions were
not necessary to place before the court all pertinent

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legal theories. We shall, however, consider the arguments
advanced by counsel in those cases.

Neither the plaintiffs in the Maynard case nor those ip
the Shapiro case are content with the interpretation of
article IX-A arrived at by Judge Walter P. Dahl in th
Lake Shore case. That interpretation was that the ney
‘Article “purports to prohibit the taxation of personal
property by valuation as to ‘individuals’, and only as tp
‘individuals’, while leaving unaffected those provisions
of the Illinois Constitution and the Revenue Act of Iii.
nois * * * which imposed such personal property taxes
as to property owned by corporations and other ‘non-in.
dividuals.’ ’’

One alternative construction, advanced by the plaintiffs
in the Shapiro case, is that the “Illinois’ Constitution of
1870, as amended by the addition of Article [X-A, speci.
fically prohibits, and declares to be unconstitutional the
imposition in IHinois of the property taxes imposed by
Article IX, Section 1, on all forms of property, real: and
personal or other, regardless of the ownership of that
poperty or the use to which that property is put by its
owner.’’ This construction is achieved by disregarding
the fact that article IX-A is clearly concerned only with
the taxation of personal property, and by concentrating
upon the fact that the last sentence in the official explana.
tion which appeared upon the ballot at the election of
November 3, 1970, when article [X-A was approved, men-
tioned taxes upon both real and personal property. That
explanation was as follows:

“The amendment would abolish the personal prop
erty tax by valuation levied against individuals. It
would not effect the same tax levied against corpors-

.tions and other entities not considered in law to be
’ individuals. The amendment would achieve this r

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sult by adding a new article to the Constitution of
1870, Article IX-A, thus setting aside existing provi-
sions of Article IX, Section 1, that require the taxa-
tion by valuation of all forms of property, real and
personal or other, owned by individuals and corpora-
tions.”’

The last sentence of the explanation, however, is not a
part of the amendment, and its reference to real property
taxes was made in describing the existing provisions of
article IX, section 1, which are modified by article [X-A.

Based upon the circumstance that the phrase “as to
individuals” is printed in italics in article IX-A, the
Maynard plaintiffs turn to materials other than the legis-
lative explanations in a search for a technical meaning.
They say: “The unusual circumstance that the words ‘as
to individuals’ are italicized in the constitutional amend- |
ment, an unprecedented practice in constitutional draft-
ing, strongly suggests that the General Assembly, in
drafting Senate Joint Resolution No. 30 used the word
sndividuals’ as one having established technical signifi-
cance and usage in the classification of taxpayers upon
whom personal property taxes have been imposed.”’

They purport to find the technical m ing that they
seek in the circumstance that two different forms, ad-
ministratively prescribed, have been used for personal
property tax returns. One form is to be used by “individ-
uals, partnerships, and unincorporated associations own-

ing or controlling personal property used in agriculture,

and all individuals owning or controlling any personal
property which is not owned or used in connection with
any business (other than agriculture) e © 6° The other
form is to be used by “[p]roprietorships, partnerships
and unincorporated associates engaged in business (other

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than agriculture) * * *.’’ On the assumption that the
word “individuals’’ was intended to have an established
technical meaning because it was printed in italics, the
Maynard plaintiffs, and the Shapiro plaintiffs as well
argue that the word “individuals” was used to denote a
class of natural persons owning personal property not
used in business.

There is, however, a more prosaic explanation for the
fact that the words “as to individuals” are printed in
italics. When Senate Joint Resolution No. 30 was origin.
ally introduced on April 29, 1969, the proposed article
IX-A read as follows: “Notwithstanding any other provi-
sion of this Constitution, the taxation of personal prop
erty by valuation is prohibited.’’ (Senate Journal, April
29, 1969, p. 1038.) On May 15, 1969, Senate Joint Resolv-
tion No. 30 was amended “by striking the period and add.
ing the following: ‘as to individuals.’” Senate Journal
May 15, 1969, pp. 1407-8.

The added words were placed in italics in accordance
with routine legislative practice, which contemplates that
in the case of amendments, new material is to be italic.
ized. The rules of the Senate of the 76th General Assem-
bly provided: “All resolutions originated in the Senate
proposing amendments to the Constitution shall be or-
dered printed and shall be printed in the same manner in
which bills are printed.” (Senate Journal, Feb. 18, 1969,
p. 163.) And as to bills, they provided: “Senate Bills and
House Bills in the Senate shall be printed with new mat
ter in italics and omitted or superseded matter enclosed
in brackets and underlined.” Senate Journal, Feb. 18
1969, p. 161.

There is thus no underpinning for the argument that
the General Assembly intended that the word “individ.
uals” should be given an artificial meaning. The official

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explanations, which are not discussed in the Maynard
prief, definitely negative such an intention. We have ex-
amined the other materials to which the Maynard and
Shapiro plaintiffs have referred, but have found nothing
which persuades us that the words of article [X-A should
be given anything other than their natural meaning.

We conclude that the meaning of article IX-A is that
ad valorem taxation of personal property owned by a
natural person or by two or more natural persons as
joint tenants or tenants in common is prohibited.

The Maynard case plaintiffs and all of the ‘Shapiro
case plaintiffs, with the exception of Shapiro, contend
that article IX-A, so construed, violates the equal protec-
tion clause of the fourteenth amendment to the constitu-
tion of the United States. Lake Shore contends that it is
the Revenue Act, which must be regarded as amended by
article IX-A, rather than the article itself, which violates
the equal-protection clause. We shall first consider the
basic question of the validity of the discrimination ef-
fected by article [X-A.

The new article classifies personal property for the pur-
pose of imposing a property tax by valuation, upon a
basis that does not depend upon any of the characteris-
ties of the property that is taxed, or upon the use to
which it is put, but solely upon the ownership of the
property. If the property is owned by A, it is taxable;
if it is owned by B, it cannot be taxed. Of course the
equal-protection clause of the fourteenth amendment does
not prohibit classification, and absolute precision is not
required of the States-in drawing the lines between class-
es, Nevertheless, a State may not, under the guise of classi-
fication, arbitrarily discriminate against one and in favor
of another similarly situated.

S

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_ The Supreme Court of the United States has thusde.

cribed the governing principles:
“Of course, the State, in the exercise of their taj
power, are subject to the requirements of the Iquj
Protection Clause of the Fourteenth Amendment. By
that clause imposes no iron rule of equality, prolibit.
ing the flexibility and variety that are appropia
to reasonable schemes of state taxation. The Stat
may impose different specific taxes upon diffrent
trades and professions and may vary the rat of
excise upon various products. It is not requird ty
resort to close distinctions or to.maintain a prise
scientific uniformity with reference to compostion,
use or value. Bell’s Gap R. Co. v. Commonweah of
Pennsylvania, 134 U.S. 232, 237, 10 S. Ct. 533, 53, 3
L. Ed. 892; Magoun v. Illinois Trust € Savings lank,
170 U.S. 283, 293, 18 S. Ct. 594, 598, 42 L. Ed. :037,
* * * State Board of Tax Com’rs of Indiana v. Jack
son, 283 U.S. 527, 537, 51 S. Ct. 540, 543, 75 L.
1248. ‘To hold otherwise would be to subject th «
sential taxing power of the State to an intoleabk
supervision, hostile to the basic principles of ow
government and wholly beyond the protection vhich
the general clause of the Fourteenth Amendment was
intended to assure.’ Ohio Otl Co. v. Conway, supra,
281 U.S., [146], at 159, 50 S. Ct. [310], at page 314
[74 L. Ed. 775].

“But there is a point beyond which the State can.
not go without violating the Equal Protection Cliuse.
The State must proceed upon a rational basis and
may not resort to a classification that is paljably
arbitrary. The rule often has been stated to be that
the classification ‘must rest upon some grouni of
difference having a fair and substantial relation to
the object of the legislation.’ F. S. Royster Guan
Co. v. Commonwealth of Virginta, 253 U.S. 412, 415,

- 40S. Ct. 560, 561, 64 L. Ed. 989; Lowitsville Gis ¢
Electric Co. v. Coleman, 277 U.S. 32, 37, 48 S Ct

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493, 425, 72 L. Ed. 770; Air-Way Electric Appliance
Corp. v. Day, 266 U.S. 71, 85, 45 S. Ct. 12, 15, 69 L.
\ Ed. 169; Schlesinger v. Wisconsin, 270 U.S. 230, 240,
46 S. Ct. 260, 261, 70 L. Ed. 557; Ohio Oi Co. v.
Conway, 281 U.S. 146, 160, 50 S. Ct. 310, 314, 74 L.

“7°.

Allied Stores of Ohio, Inc. v. Bowers (1959), 358 U.S.
592, 526-527, 79 S. Ct. 437, 440, 3 L. Ed. 2d 480, 484-485.

When classifications are reasonable, it is because of dif-
ferences in the nature of the property or in the use to
which it is put. The nature of the tax is important, too,
for what may be a reasonable classification for a license,
or a privilege tax, is not necessarily a reasonable classi-
feation for a property tax.

Mr. Justice Brandeis stated the criterion this way in
his dissenting opinion in Quaker City Cab Co. v. Penn-
sylvania, 277 U.S. 389, 406, 48 S. Ct. 553, 556, 72 L. Ed.
997, 932: “In other words, the equality clause requires
merely that the classification shall be reasonable. We call
that action reasonable which an informed, intelligent,
just-minded, civilized man could rationally favor. In pass-
ing upon legislation assailed under the equality clause
we have declared that the classification must rest upon a
difference| which is real, as distinguished from one which
is seeming, specious, or fanciful, so that all actually situ-
ated similarly will be treated alike, that the object of the
classification must be the accomplishment of a purpose or
the promotion of a policy, which is within the permissi-
ble furctions of the state, and that the difference must
bear a relation to the object of the legislation which is
substantial, as distinguished from one which.is specula-
tive, remote, or negligible.”

Article IX-A must be read against the scheme of prop-
erty taxation established pursuant to article IX of the

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constitution of 1870, which, with respect to Property
taxes, contemplates the levy of “a tax, by valuation, »
that every person and corporation shall pay a tax ip
proportion to the value of his, her or its property * * *”
(Const. of 1870, art. IX, Sec. 1.) Taxes levied by muyj.
cipal corporations are required to be “uniform in respect
to persons and property, within the jurisdiction of th
body imposing the same.” (Const. of 1870, art. IX, see 9)
The permissible exemptions from taxation are thus des.
cribed: “The property of the state, counties, and other
municipal corporations, both real and personal, and such
other property as may be used exclusively for agricql.
tural and horticultural societies, for school, religion,
cemetery and charitable purposes, may be exempted from
taxation; but such exemption shall be only by general
law * * *.” Const. of 1870, art. IX, sec. 3.

Against this background the incongruity of the pro
hibition contained in article IX-A is apparent. It cannot
rationally be said that the prohibition promotes any pol-
icy other than a desire to free one set of property owners
from the burden of a tax imposed upon another set. All of
the arguments in favor of the abolition of the personal
property tax upon the property owned by natural persons
apply with equal force in favor of the abolition of that
tax upon the property owned by others. For the purpose
of a tax by valuation upon the ownership of real or per-
sonal property, the identity of the owner is a neutral
consideration, as is his status as sole proprietor, joint
tenant, tenant in common, partner (Ill. Rev. Stat. 1969,
ch. 10614, par. 25), limited partnership (Ill. Rev. Stat.
1969, ch. 10614, par. 61), member of a professional serv-
ice corporation (Ill. Rev. Stat. 1969, ch. 32, par. 4151
et seq.), or of a professional association (Ill. Rev. Stat

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1969, ch. 106%, par. 101 et seq.; see Sup. Ct. Rule 721,
ll. Rev. Stat. 1969, ch. 110A, § 721; 43 Ill. 2d R. 721).

[2] We hold, therefore, that the discrimination pro-
duced by article [X-A violates the equal-protection clause
of the fourteenth amendment. Apart from that discrim-
ination, the validity of the Revenue Act is not challenged,
and we hold that it is article [X-A which must fall. The
validity of article IX of the constitution and of the
Revenue Act are therefore not affected.

The judgment of the circuit court of Cook County in
No. 44199 (Lake Shore) is reversed, and the cause is re-
manded to that court with directions to dismiss the com-
plaint. Insofar as the judgment of the circuit court in
No. 44432 (Shapiro) dismissed the complaint as to all
of the plaintiffs other than Clemens K. Shapiro, it is af-
firmed; insofar as that judgment sustained the complaint
as to Clemens E. Shapiro, it is reversed and the cause is
remanded to that court with directions to dismiss the
complaint. In No. 44308 (Maynard), the complaint is dis-
missed.

No. 44199. Reversed and remanded with directions.

No. 44308. Complaint dismissed.

No. 44432. Affirmed in part; reversed in part and re-
manded, with directions.
DAVIS, Justice (dissenting).

The majority opinion holds that our State constitution
~ of 1870, as modified by article IX-A, may not validly
dassify exemptions from ad valorem personal property
taxation on the basis of the ownership of the property,
and that such exemption may be made only upon a classi-
fication based upon the nature of the property or its use.
I dissent from this pronouncement,

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It is clear that the United States Constitution impoge
no particular modes of taxation upon the states anj
leaves them unrestricted in their power to tax thom
domiciled within their borders so long as the tax imposed
is upon property within the State, or on privileges e.
joyed there, and so long as the tax is not so palpably
arbitrary or unreasonable as to infringe upon the equ)
protection and due process requirements of the fourteenth
amendment. Lawrence v. State Tax Commission of Migs.
issippi, 286 U.S. 276, 280, 52 S. Ct. 556, 557, 76 L.
1102, 1105.

The majority opinion recognizes that “the equal-protee.
tion clause of the fourteenth amendment does not pr.
hibit classification, and absolute precision is not required
of the states in drawing the lines between classes’’; and
that, “nevertheless, a state may not, under the guise of
classification, arbitrarily discriminate against one and in
favor of another similarly situated.’’ This general rule is
found in the quotation from Allied Stores of Ohio, Inc. 1.
Bowers, 358 U.S. 522, 79 S. Ct. 487, 3 L. Ed. 2d 480, cited
by the majority. The rule has been expressed and er.
emplified many times in varying terms. Examples ar:
“Any classification of taxation is permissible which has
reasonable’ relation to a legitimate end of governmental
action.” (Welch v. Henry, 305 U.S. 134, 144, 59 S. Ct. 121,
124, 83 L. Ed 87, 92); “It is a salutary principle of jud-
cial decision, * * * that the burden of establishing the
unconstitutionality of a statute rests on him who assails
it, and that courts may not declare a legislative discrim-
ination invalid unless, viewed in the light of facts made
known or generally assumed, it is of such a character as
to preclude the assumption that the classification rests
upon some rational basis within the knowledge and ¢x-

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‘A19

perience of the legislators. A statutory ‘discrimination
will not be set aside as the denial of equal protection of
the laws if any state of facts reasonably may be con-
ceived to justify it.” (Metropolitan Casualty Ins. Co. v.
Brownell, 294 U.S. 580, 584, 55 S. Ct. 538, 540, 79 L. Ed.
1070, 1073); due process imposes no rigid rule of equality
in taxation, and irregularities resulting from singling out
one particular class for taxation or exemption infringe no
constitutional requirement. (Carmichael v. Southern Coal
é Coke Co., 301 U.S. 495, 509, 57 S. Ct. 868, 872, 81 L.
Ed. 1245, 1253); and it is only the invidious discrimina-
tion or classification which is patently arbitrary and ut-
terly lacking in rational justification which is barred by
the due process or equal protection clauses. Flemming v.
Nestor, 363 U.S. 608, 611, 612, 80 S. Ct. 1367, 1373, 4 L.
Ed. 2d 1435, 1445.

The variety of ways of expressing the rule that a legis-
lative classification for taxation purposes is not violative
of the fourteenth amendment if it has a reasonable rela-
tion to the subject of the particular legislation so that
all persons similarly situated are treated alike, and per-
tinent citations, are found in 16A C.J.S. Constitutional
Law, §§ 520, 521, 649.

In this litigation, as is often the case, the particular
expression of the rule which the majority of the court
chooses to rely upon may be dictated by the outcome
which the judges of the majority think to be proper. Be-
yond doubt, the fourteenth amendment does not impose
on the states an inflexible and technical rule of equal
taxation, and the extent. to which the States may go in
devising a legislative classification for taxation is illus-
trated by the statement of the Supreme Court in Lawr-
ence v. State Tax Commission of Mississippi, 286 US.
276, 284, 285, 52 S. Ct. 556, 559, 76 L. Ed. 1102, 1108:

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“The equal protection clause does not require th
state to maintain a rigid rule of equal taxation,
resort to close distinctions, or to maintain a pregig
scientific uniformity; and possible differences in tay
burdens not shown to be substantial or which ap
based on discriminations not shown to be arbi
or capricious, do not fall within constitutional pp.
hibitions.”

The Supreme Court in Lawrence also stated that ther
is no constitutional requirement that a system of taxation
should be uniform as applied to individuals and corpom.
tions, regardless of the circumstances in which it operates
(286 U.S. 276, 283, 52 S. Ct. 556, 558, 76 L. Ed. 110,
1107), and we have just recently held that for the pw.
pose of income taxation, corporations may be placed in
one class and individuals in another and each taxed dif.
ferently. (Thorpe v. Mahin, 43 Ill. 2d 36, 250 NE. &
633.) The language of the court at pages 45 and 46, at
page 638 of 250 N.E. 2d is worthy of repetition:

“It is next contended that the Act violates the mi.
formity provision of section 1 of article IX of ow
constitution and the equal-protection and due-process
requirements of the fourteenth amendment to the
United States constitution by creating multiple class.
es and discriminating unreasonably among them. This
contention is advanced specifically against the pro.
visions which tax corporations at a 4% rate and in
dividuals, trusts, and estates at 214% rate.

“Both the equal protection argument and the wi-
formity argument depend on the reasonableness of
putting corporations in one class and _ individuals,
trusts, and estates in another class for purposes of
this tax. (See Grenter & Co. v. Stevenson, 42 Ill. M
289, 247 N.E. 2d 606.) When the due-process conten-
tion has been advanced, this court, citing Supreme
Court cases, has stated: ‘It has long been settled that

‘the power of the legislature to make classifications,

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particularly in the field of taxation, is very broad,
and that the fourteenth amendment imposes no “iron
rule” of equal taxation. [Citations.] The reasons
justifying the classification, moreover, need not ap-
pear on the face of the statute, and the classifica-
tion must be upheld if any state of facts reasonably
can be conceived that would sustain it. [Citations.]
The burden therefore rests on one who assails the
statute to negate the existence of such facts. [Cita-
tions.]’ Department of Revenue v. Warren Petro-
leum Corp., 2 Ill. 2d 483, 489-490, 119 N.E. 2d 215.

When the uniformity contention has been advanced
this court has stated: ‘It is well established that the
legislature has broad powers to establish reasonable
classifications in defining subjects of taxation. * * *
Such classification must, however, be based on real
and substantial differences between persons taxed
and those not taxed. [Citations.]’ (Klein v. Hulman,
34 Ill. 2d 343, 346-347, 215 N.E. 2d 268, 270.) ‘In
order to prevail on an allegation that a statute or
portion of a statute is unconstitutional, the plaintiff
has the burden of showing how the legislature has
violated the constitution.’ Grenier & Co. v. Stevenson,
42 Til. 2d 289, 291, 247 N.E. 2d 606, 608.

“In short, petitioners have the burden of showing
that the challenged classification, is unreasonable.
Their only assertion is that ‘corporations are at a
disadvantage when they compete in the same type
of business with individual proprietorships or part-
nerships because of the rate differential.’ This asser-
tion has been rejected by the Supreme Court as to a
Federal tax (Flint v. Stone Tracy Co., 220 U.S. 107,
31 S. Ct. 342, 55 L. Ed. 389), and as to a State tax
(Fort Smith Lumber Co. v. Arkansas ex rel. Ar-
buckle, 251 U.S. 352, 40 S. Ct. 304, 64 L. Ed. 396),
and by this court (People v. Franklin National In-
surance Co. of New York, 343 Ill. 336, 175 N.E. 431;
Michigan Millers’ Mutual Fire Insurance Co. v. Mc-
Donough, 358 Ill. 575, 193 N.E. 662), where, for pur-

A22 /

poses of the tax in question, corporations were placaj
in one class and individuals in another and each wen
taxed differently.’’

The majority, however, holds that as to a property ta
the classification for exemption or taxation may not ly
based upon the character of the ownership, but only upm
the nature of the property itself. Thus, the majority jg of
the opinion that the classification may not be based upon
the corporation—individual distinctions whch we upheld
in Thorpe.

In Thorpe this court reversed its prior holding that
income is property (Bachrach v. Nelson, 349 Ill. 579, 19
N.E. 909), and held that an income tax was not a prop
erty tax. The significance of this determination was that
section 1 of article IX of. our Constitution of 1870) n
quired the levying of a tax “by valuation, so that every
person and corporation shall pay a tax in proportion t
the value of his, her or its property * * *.” At the sam
time, the constitutional provisions permitted a tax upon
franchises and privileges in manner as the legish.
ture might direct, so long as it was uniform as to each
“elass.’’ Obviously, the legislature could not, under the
foregoing provisions, impose an income tax upon corpor-
tions at one rate and upon individuals at a lesser rate if
it were a tax on property. Our constitution then pn
hibited any tax on property unless structured to be mi
form as to valuation.

After reaching the conclusion that an income tax wa
not a property tax, the court faced no barrier in upholi-
ing the Illinois Income Tax Act. In the case at bar, after
article [X-A amendment to the constitution of 1870 was
adopted, the uniformity provisions of section 1 of article
IX were no longer effective as to the taxation of per

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sonal property of individuals, and the court should have
found no impediment to upholding the validity of article
Ix-A and the abolishment of this tax as to individuals.

Constitutional provisions requiring property to be
taxed uniformly in proportion to its value are not un-
common to the state. In the California Railroad Tax
eases (San Mateo County vy. Southern Pacific R. Co., C.C.,

13 F. 722, appeal dismisdéd per stipulation, 116 U. S. 138,
6 S.Ct. 317, 29 L. Ed. 589; Santa Clara County v. South-
ern Pacific R. Co., C.C., 18 F. 385, aff’d other grounds,
118 U.S. 394, 6 St.Ct. 1132, 30 L. Ed. 118), which held
that unequal taxation, based upon the character of the
owner, was forbidden by the fourteenth amendment, a
constitutional provision requiring uniformity of taxation
was involved. Even though the California consttution
specified that all property be taxed in proportion to its
value, laws of the State especially provided that as to
railroad properties only; the amount of a mortgage on
the real estate was not to be deducted in ascertaining
the value of the real estate for taxation purposes. The
trial court quite properly held that this method of valua-
tion, as to railroads only, was improper under the cir-
cumstances, and the United States Supreme Court af-
firmed the lower court on a nonconstitutional basis with-
out reaching the constitutional question. The California
railroad tax cases should be read, with cognizance, that
the State constitution required all property to be taxed
in proportion to its value, and that the cases arose at a
time when it was necessary to establish that the word,
“nersons’’ as used in the fourteenth amendment, included
corporations. Apparently, the latter point had a strong
bearing on the expressions found in these cases.

In the case at bar, by virtue of the adoption of article
IX-A, there is no constitutional requirement that taxes

A%

on personal property be uniform as to individuals anj
corporations so that each pays a tax in proportion to th
value of his or its property. Article IX-A, which we
are called upon to consider, eliminated this requirement;
it provides that “the taxation of personal property is
prohibited as to individuals.’ Thus, the case at bar js
a far cry from one in which the legislature is attempt.
ing to discriminate between individuals and corporations
in the face of a constitutional provision prohibiting such
discrimination. Here the question for determination jg
whether, absent the requirement of a State constitution
that corporate and individual personal properties be
taxed the same, the equal protection clause of the four.
teenth amendment permits them to be taxed differently,
I believe that it does! |

Without the constitutional requirement of urifformity
on the taxation of properties, there is no reason or justi-
fication in the case at bar for stating that personal prop
erty taxation may not be classified on the basis of own.
ership of the property. The constitution of 1870, as
amended by article IX-A, does not so provide, and the
constitution of 1970 suggests the contrary. Article IX
of the constitution of 1970 relates to revenue, and section
5 thereof pertains to personal property taxation. Sub-
section (a) thereof provides that the legislature “may
classify personal property for purpose of taxation by
valuation, abolish such taxes on any or all classes and
authorize the levy of taxes in lieu of the taxation of
personal property by valuation.” (Emphasis ours.) With-
out more, it could be said that the word, “classes” refers
only to classes of property, but subsection (c) refers to
the abolition. of all ad valorem personal property taxes
by January 1, 1979, and the replacement of the lost rev-

A2%5

enue, and provides: “Such revenue shall be replaced by
imposing statewide taxes, other than ad valorem taxes
on real estate, solely on those classes relieved of the
purden of paying ad valorem personal property taxes
pecause of the abolition of such taxes subsequent to Jan-
uary 2, 1971.” (Emphasis our.) Obviously, the word,
“classes” as there used, does not refer to classes of prop-.
erty; it refers to classes of property owners and provides
for taxation according to the character of the owner. If
the majority opinion is to stand and article [X-A held
to be unconstitutional, then under consistent application
of its rationale, subsection (a) of section 5 of the new
constitution is likewise unconstitutional.

The majority opinion chose to rely upon the rationale
of Quaker City Cab Co. v. Commonwealth of Pennsy]-
vania, 277 U.S. 389, 48 S.Ct. 553, 72 L. Ed. 927. I be-
lieve that the elucidation and logic of the dissent of Mr.
Justice Brandeis, in which Mr. Justice Holmes concurred,
offers the better reason. Therein, Mr. Justice Brandeis
made some observations which are particularly apropos
here. The court had under consideration a tax on the
gross receipts of corporate taxicab companies where no
similar tax was imposed upon the receipts of individuals
who operated taxicabs. The majority held that the clas-
sification was based solely upon the character of the own-
er, and that it violated the fourteenth amendment.

In his dissenting opinion, 277 U.S. 389, 403-412, 48
S.Ct. 553, 555-558, 72 L. Ed. 927, 931-934, Mr. Justice
Brandeis observed that the tax applied equally to all
corporations, foreign and domestic. He stated that the
fundamental question before the court was:

“Does the equality clause prevent a state from im-
posing a heavier burden of taxation upon corpora-

A26 |

tions engaged exclusively in intrastate commeres,
than upon individuals engaged under like circum.
stances in the same kind of business? The narrower
question presented is whether this heavier burden
may be imposed by a form of tax ‘not peculi
applicable to corporations’; that is, by a tax of such
a character that it might have been extended to in.
dividuals if the Legislature had seen fit to do so,”

He then pointed out that the difference between a buai-
ness carried on in corporate form and one carried on by
natural persons is “a real and important one.” He ob.
served that the discrimination was not based upon any
difference in the source of income or in the character of
the property employed, and stated the obvious: that the
requirement that a classification must be reasonable does
not imply that the policy embodied in the classification
must be deemed by the court to be a wise one. He con.
cluded that a state is permitted to impose upon COrpo-
rations more than their pro rata share of the burden of
taxation, and that nothing in the Federal constitution
prohibits this.

It seems that this is exactly what we held in Thorpe
v. Mahin, 43 Ill. 2d 36, 250 N.E. 2d 633. We recognized
what we called the obvious advantages of carrying ona
business in the corporate form. The privilege of carrying
on a business in this form has many advantages: the
corporate ownership of property, freedom from personal
liability for corpoate obligations, continuity of existence,
etc. There we acknowledged that there are sufficient
differences between the privilege of earning or receiving
income as a corporate entity and that of earning or re-
ceiving income as an individual, to justify the variance
in tax rates between the individual and the corporation,
and here we should recognize that there are sufficient

A27

differences between the privilege of owning property as
"4 corporate entity and the privilege of owning it as an
individual to justfy the exemption in the case of the
individual property owner. The fact that the corpora-
tion may in some respects be placed at a disadvantage
in its competition with individuals owning similar prop--
erty and engaged in the same business should not con-
demn the classification as unreasonable. Thorpe v. Mahin,
at p. 46, 250 N.E. 2d 633.

There is no more compelling reason to suggest that
the classifications for personal property tax purposes
must be based upon the nature of the property than
there is to suggest that the classifications for income tax
purposes must be based on the source or type of income
to be reported. The article IX-A constitutional amend-
ment creates a classification based upon the distinctions
inherent between corporations and individuals—a distine-
tion which we have recognized and upheld as valid under
the equal protection clause requirement of the fourteenth
amendment in Thorpe v. Mahin.

Another matter is worthy of mention in our considera-
tion of this case. The evils and the inequities in the
administration of the personal tax collections in this State
are known to everyone. That these inequities apply with
equal force to corporate taxpayers and individual tax-
payers may, or may not, be totally true. The desire and
purpose of systematically eliminating this archaic form
of taxation are apparent from the actions of the people
and the legislature of the State. The General Assembly,
vhich drafted’and adopted Senate Joint Resolution No.
30, had previously at the same legislative session already
exempted from such taxation, household furniture and
one automobile, per household, if used for personal plea-

A28

sure. (Ill. Rev. Stat. 1969, ch. 120, para. 500.21a.) The
article IX-A amendment was overwhelmingly ratified

the people of the State. The constitution of 1970, like
wise adopted by the vote of the people, expressed con.
cern over the form and use of personal property taxa.
tion. The newly-adopted constitution prohibits the rein.
statement of any ad valorem personal property tax abol.
ished before January 1, 1971, the effective date of the new
constitution. This provision refers to the, personal prop-
erty tax as to individuals which was abolished by article
IX-A, and the majority opinion runs counter to this. con.
stitutional prohibition in that it reinstates the personal
property tax as to individuals. In addition, the new con.
stitution provides that all ad valorem personal property
taxes shall be abolished on or before January 1, 1979.

The obvious spirit of the article [IX-A amendment, the
will of the people, as expressed by its adoption, and the
intent and purpose of the legislature, should not be
thwarted unless a construction to this effect is required,
Thus, it is very appropriate that we consider the mis. “
chief sought to be remedied and the purpose to be accon-
plished by the article IX-A amendment. (Wolfson y.
Avery, 6 Ill. 2d 78, 88, 126 N.E. 2d 701.) Likewise, the
court should memorialize the salutary rule of law that an
amendment to a State constitution should be deemed vio-
lative of the Federal constitution only where the asserted
constitutional rights cannot otherwise be protected and
effectuated. Reynolds v. Sims, 377 U.S. 533, 584, 84 S.Ct.
1362, 1393, 12 L.Ed 2d 506, 540.

After considering the background of this constitutional
amendment and the purpose which it, along with the other
contemporary legislative enactments and constitutional
adoptions, seeks to accomplish, I believe that the classi-

A29

fication found in the article [IX-A amendment does not
constitute an invidious discrimination; that it seeks to
accomplish and promote a valid policy expressive of the
will of the people and the intent and purpose of the legis-
lature; and that the distinction upon which the classifi-
cation for exemption is based does not overstep the limi-
tations imposed by the fourteenth amendment.

A30

STATE OF ILLINOIS } gg
COUNTY OF COOK {

IN THE CIRCUIT COURT OF

COOK COUNTY,

ILLINOIS COUNTY DEPARTMENT,
CHANCERY DIVISION

LAKE SHORE AUTO PARTS)
CO., an Illinois corporation, on its
own behalf and also as representa-
tive of a class of corporations and
other “non-individuals”, which
class is herein described,
Plaintiffs,
vs.
BERNARD J. KORZEN, County
Treasurer and_ ex-officio County
Collector of Cook County, GEOR-
GE E. KEANE and HARRY &.
SEMROW, Members of the Board
of Appeals of Cook County, P. J.
- CULLERTON, County Assessor of
Cook County, EDWARD J. BAR-
RETT, County Clerk of Cook
County, and ROBERT J. LEN-
HAUSEN, Director, Department of
Local Government Affairs of the

; NO. 70 CH 51%

State of Illinois. :
ORDER

This cause coming on to be heard upon the Motion For
Summary Judgment of LAKE SHORE AUTO PARTS
CO., an Illinois corporation, plaintiff, by and through

A31

its attorneys, ORLIKOFF, PRINS, FLAMM & SUSMAN,
and upon the Cross-motion For Summary Judgment of
defendant ROBERT J. LENHAUSEN, Director, Depart-
ment of Local Government Affairs of the State of Illinois,
by and through the Attorney General of Illinois, and the
Cross-motion For Summary Judgment of defendants KOR-
ZEN, KEANE, SEMROW, CULLERTON and BAR-

RETT, assessing and taxing officials of Cook County, by
and through the State’s Attorney of Cook County.

The Court having examined the pleadings and memo-
randa filed by the parties hereto, having heard the
arguments of counsel and being fully advised in the pre-
mises

DOES HEREBY FIND:

1. That there is no genuine issue as to any material
fact in this cause, and it is therefore appropriate and
proper that the cause be determined on the Motion and
Cross-motions For Summary Judgment.

9. That the plaintiff, LAKE SHORE AUTO PARTS
CO., is a corporation duly organized and existing under
the laws of Illinois, and on April 1, 1970, was the owner
of personal property having a taxable situs in the
County of Cook, which property has been included on
the assessment role now being prepared by the assessing
officials of Cook County for the tax year 1970; that the
plaintiff has standing to bring this action on its own be-
half, and it is not at this time necessary or appropriate
to determine whether the action is properly brought and
maintained as a class action or to determine the definition
of the plaintiff class. |

3. That an amendment to the Illinois Constitution of
1870, designated as Article [X-A, was approved by the

para:
ie

A32

people of Illinois at a referendum held on Novembe
7, 1970, and such amendment, by its terms, became gf.
fective January 1, 1971; that said Article [X-A purports
to prohibit the taxation of personal property by valu,
tion as to “individuals”, and only as to “individuals?
while leaving unaffected those provisions of the Ilinois
Constitution and the Revenue Act of Illinois (Ill. Rey,
Stat. 1969, ch. 120, § 482 et seq.) which impose sneh
personal property taxes as to property owned by corpora.
tions and other “non-individuals”.

4. That said Article IX-A is self-executing, and the
necessary effect of the adoption thereof is to amend the
various provisions of the Revenue Act of Illinois, specif.
cally including but not limited to §18 thereof (Ill. Rey,
Stat. 1969, ch. 120, §499), so as to exempt from personal
property taxes thereby imposed all personal property
owned by “individuals”, while retaining such taxes as
to personal property owned by corporations and other
“non-individuals.”

5. That the Revenue Act of Illinois, as so amended
by Article IX-A of the Illinois Constitution, deprives
the plaintiff corporation of the equal protection of the
laws guaranteed by the Fourteenth Amendment to the
Constitution of the United States; that said Revenue Act
of Illinois, to the extent that it purports to impose per-
sonal property taxes with respect to the property owned
by plaintiff, is therefore unconstitutional, void and of no
effect whatsoever.

6. That Article IX-A of the Illinois Constitution is not
applicable with respect to personal property taxes im-
posed by the Revenue Act of Illinois for the year 1970,
the assessment date for which was April 1, 1970, and the
assessment of which had been commenced prior to Janv-

A33

ary 1, 1971, the effective date of Article [IX-A, notwith-
standing that such assessment had not been completed
as of that date:

If IS THEREFORE ORDERED, ADJUDGED AND
DECREED THAT:

7. The plaintiff's Motion For Summary Judgment is
granted in part and denied in part, the Court declaring
that the Revenue Act of Illinois (Til. Rev. Stat. 1969, ch.
120, §§ 482 et seq.), said Revenue Act having been amend-
ed by Article IX-A of the Illinois Constitution, is viola-
tive of the Fourteenth Amendment to the Constitution
of the United States and is held to be void and unen-
forceable insofar as said Revenue Act purports to impose
personal property taxes on plaintiff.

8. The defendants’ Cross-motions For Summary Judg-
ment are granted in part and are denied in part, the
Court declared that Article IX-A of the Illinois Consti-
tution is not applicable to, and does not impair the collec-
tion of, personal property taxes imposed by the Revenue
Act of Illinois, the assessment of which were commenced
prior to January 1, 1971.

9, Except for those matters adjudicated by paragraphs
7 and 8 of this Order, this Court retains jurisdiction of
this cause for all purposes.

10. Pursuant to Rule 304(a) of the Rules of the Su-
preme Court of Illinois, the Court expressly finds that
there is no just reason for delaying enforcement or ap-
peal of this Order. In the event of an appeal from this
Order, the Court is of the opinion that the interests of
justice would be best served by hearing and deciding
the appeal as expeditiously as possible because of the

A34

manifest public importance of the issues and the sqb.
stantial amount of tax revenues that are involved.

DATED: , 1971.

ENTER: ~

7

Judge, Circuit Court of Cook
County, Illinois.

A35

ATE OF ILLINOIS }
SOUNTY OF cooK 5 *

IN THE CIRCUIT COURT OF COOK COUNTY,
ILLINOIS COUNTY DEPARTMENT,

TAX DIVISION

CLEMENS K. SHAPIRO, JER-)
QME HERMAN, d/b/a THE
SPOT, GUY S. ROSS AND EU-
GENE D. ROSS, d/b/a GUY S.
ROSS & CO., a partnership; and
M. WEIL AND SONS, INC., an
Illinois Corporation, all individual-
ly and in representative capacity,

Plaintiffs,
Vs.

EDWARD J. BARRETT, County
Clerk of Cook County; BERNARD > No. 71 L 5745
J. KORZEN, County Treasurer
F and ex-officio County Collector of
Cook County; GEORGE E.
- KEANE and HARRY H. SEM-
| ROW, Members of the Board of
- Appeals of Cook County; P. J.
CULLERTON, County Assessor of
Cook County, and ROBERT J.
LEHNHAUSEN, Director, Depart-
ment of Local Government Affairs
of the State of Illinois,

Defendants. J

A36

ORDER

This cause appears before this Court on plaintiffs’ Com.
plaint for Declaratory Judgment, filed pursuant to Chap
ter 110, Section 57.1 of the Civil Practice Act. The a
tion was filed by plaintiffs for themselves and in a repr
sentative capacity on behalf of all other persons similarly
situated. The cause comes on for hearing on separate mo.
tions, to strike and dismiss that complaint, filed by Com.
ty and State defendants. Defendants have elected to stand
on their motions. 4

No genuine issue as to any material fact emerges.
The plaintiffs are:

1. Clemens K. Shapiro, is a natural person, citi.
zen and taxpayer of the State of Illinois, resident of
and a salaried employee in the County of Cook
wherein he owns personal property in his own name,
and owns real property jointly with his wife, none of
which property is owned or used in the operation of,
or for purposes of business, and all of which property
is owned and used for his personal enjoyment and
that of his family.

2. Jerome Herman, is a natural person, and a
citizen of the State of Illinois, and as sole proprietor
owns, operates and conducts a business located in
Cook County, Illinois, and is the owner of property
and a taxpayer herein.

3. Guy S. Ross and Eugene D. Ross, natural per.
sons, citizens and residents of the State of Illinois,
both of whom are partners, and as partners operate
and conduct a business as a partnership duly organ
ized under the laws of the State of Illinois, whieh
business entity is located in the County of Cook and
is the owner of property and a taxpayer therein

4. M. Weil and Sons, Inc., a corporation duly
organized and existing under the laws of the State

A37

of Illinois, is located in, and is the owner of property
situated in the County of Cook and a taxpayer there-

In.

Each of the plaintiffs is an owner of property subject
to the ad valorem tax directed to be imposed by Article
IX of the Illinois Constitution of 1870, and imposed by
the Illinois Revenue Act of 1939, which property has been
assessed by valuation and continues to be so assessed by
defendants pursuant to that constitutional and statutory
authority. :

The electorate of this State, on November 3, 1970,
adopted amending Article IXA to the Illinois Constitu-
tion of 1870. This amendment became part of the Illinois
Constitution on November 25, 1970, and reads as follows:

“Article IX-A
TAXATION OF PROPERTY
Ҥ 1, Taxation of personal property prohibited. Sec-
tion 1. Notwithstanding any other provision of this

Constitution, the taxation of personal property by
valuation is prohibited as to individuals.”

“SCHEDULE
“Paragraph 1. This amendment shall become effec-
tive January 1, 1971.’’
Plaintiffs contend as follows:

All plaintiffs contend that Illinois Constitution of 1870,
as amended by the addition of Article [XA, specifically
prohibits, and declares to be unconstitutional the imposi-
tion, in Illinois, of the property taxes imposed by Article
IX, Section 1, on all forms of property, real and personal
or other, regardless of the ownership of that property
or the use to which that property is put by its owner.

A38

All plaintiffs contend that if Article IXA does not pm.
hibit the taxation of all property, then Article [XA pn
hibits the tax to be measured by the value of the prop
erty taxed.

All plaintiffs contend that the prohibition of Artich
IXA, which abolishes the imposition of property ty
measured by valuation of the property taxes, extends tp
those taxes so measured where the assessment of plain.
tiffs’ property has been commenced by defendants prior
to, even though not completed on January 1, 1971, the
effective date of Article IXA, and payment due there.
after.

Natural Persons contend that:

The designation “individuals” in Article [XA properly
and validly describes, is intended to apply, and does ap
ply solely to them; and the taxation by valuation pro
hibited in Article IXA, if not applicable to all property
owned by them, is applicable to personal property owned
by them and used by them for their personal purposes;
and that,

Article IXA prohibits taxation, by valuation of person.
al property as to them alone, while denying that pro.
hibition as to all others, is proper, valid, and constitution.
al under both Illinois Constitution and the Constitution
of the United States.

Both business entities and corporations contend that:
Article IXA, effective January 1, 1971, as an amend-

ment to Illinois Constitution of 1870 is offensive to the
Constitution of the United States.

If the designation “individuals’’ in Article [XA ip
vokes prohibition of taxes by valuation on personal prop-
erty exclusively as to “natural persons” and _ personal

A39

property owned by them, but denies the same prohibition
to business entities and corporations, then such classifi-
eation is discriminatory, unreasonable and offensive both
to Illinois Constitution and the Constitution of the United
States. This is true for the reasons that such classifica-
tion is invalidly predicated upon purported differences
between users of identical property and the use to which
that property is put, instead of differences found to exist
between the forms of the property upon which that tax
is directly laid. The employment of such base constitutes
special legislation prohibited by Article IV, Section 22 of
Illinois Constitution, as well as denying to business en-
tities and corporations due process of law and the equal
protection of the law guaranteed to them by Article TI,
Section 2 of the Illinois Constitution, and the Fourteenth
Amendment to the Constitution of the United States.

Unless the exclusion of property owned by “individ-
“ als’ is construed to exclude the property of business
entities and corporations, as well as that of natural per-
sons, then the employment in Article IXA of the term
“individuals” is so vague, uncertain, and incapable of
definitive application to the context of Article IX, that
Article TIXA must fall because it is totally absent the
comprehension. required, especially of constitutional pro-
visions, by both Illinois Constitution and the Constitu-
tion of the United States.

Business entities contend that:

(a) The designation “individuals’’ in Article IXA
correctly and properly described, and is intended to ap-
ply to, and does include business entities which own
property hecause the natural person owners of that busi-
ness entity are personally and individually liable for the
payment of that tax.

A40

Article [X-A prohibiting taxation by valuation of
erty owned by such business entities, while denying thy
prohibition as to corporations is proper, valid and ep,
stitutional under both Illinois’ Constitution and the (Cop.
stitution of the United States.

Corporations contend that:

If the designation “individuals” in Article IX-A ap.
plies to any or all owners of property except corporat
owners of property, then such classification is discrimjp.
atory, unreasonable, and offensive to both the TIllinoiy
Constitution and the Constitution of the United State

Defendants contend that the taxation by valuation of
real property and other property, as provided in Article
IX shall continue and remain, in all regards, unaffected
by Article [X-A. however:

Notwithstanding any other provision of this Constitp.
tion, the taxation of personal property by valuation js
prohibited only as to natural persons; but as to them,
only as to the personal property owned by them; but as
to that personal property owned by them, only such of
that property which is used by them for the personal
judgment of themselves and their families.

This matter appearing on the pleadings aforesaid, pre.
senting the issues to this Court as delineated by thos
pleadings, and the Court having heard argument by all
parties in support of their respective positions, THIS
COURT FINDS:

1. That a genuine cause and controversy exists, and
that this action is properly maintained under the provi-
sions of Chapter 110, Section 57.1 (Declaratory Judg.
ments), Civil Practice Act, Illinois Revised Statutes, 1969.

2. Each of these plaintiffs has standing to bring this

A41

action in his or its own behalf and is a proper representa-
tive of his class.

3 That this action is properly maintained as a class
action, and the members of those classes are adequately
and competenthy represented by counsel herein.

4. That Article IX-A of the Illinois Constitution of
1870 is valid, constitutional and immune to all of the
plaintiffs’ assaults, both under the Illinois Constitution
and the Constitution of the United States.

5. That Article IX-A is free of the ambiguity and
uncertainty of intendment charged by the plaintiffs, and
that its intendment is clearly declared to prohibit the
taxation of personal property by valuation exclusively
as to natural persons, where that property is used, by
them, for the personal enjoyment of themselves and their
families.

6. That these findings by this Court make it unneces-
sary to consider contentions made by plaintiffs in the
alternative. ;

7. That all issues as found heretofore are found in
favor of the defendants, except as to those issues relat-
ing to the plaintiff Clemens K. Shapiro and members of
‘his class involving personal property owned and used by
them for the personal enjoyment of themselves and their
families.

8. That motions to strike and dismiss plaintiffs’ Com-
plaint are sustained in regards and in respect of those
found in favor of the defendants, except as to those is-
sues raised by plaintiff Clemens K. Shapiro and mem-
bers of his class involving personal property owned and
used by them for the personal enjoyment of themselves
and their families.

A42

9. Pursuant to Rule 304(a) of the Rules of the Sp.
preme Court of Illinois, the Court expressly finds that
there is no just reason for delaying enforcement or ap.
peal of this Order. In the event of an appeal from this
Order, the Court is of the opinion that the interests of
justice would be best served by hearing and deciding
the appeal as expeditiously as possible because of the
manifest public importance of the issues and the sub.
stantial amount of tax revenues that are involved.

WHEREFORE, IT IS ORDERED, ADJUDGED anj
DECREED that defendants’ motions to strike and dis.
miss are sustained as to all plaintiffs, except the plain.
tiff Clemens K. Shapiro and members of his class, and
plaintiffs’ Complaint is stricken as to all issues and in
all regards and respects contrary to and in variance
with the judgment of this Court; that Amending Article
IX-A of the Illinois Constitution is valid and constity.
tional in all respects and is immune to attack tinder any
provision or provisions of the Illinois Constitution of
1870 and the United States Constitution, and that said
Amending Article IX-A declares its prohibition exch.
sively as to any personal property tax on the personal
property owned by individuals and used for their per-
sonal enjoyment and that of their families.

ENTER:

THOMAS C. DONOVAN,
Presiding Judge, Tax Division,
Circuit Court of Cook County,
Illinois.

Date: May 27, 1971.

A43

STATE OF ILLINOIS )
) 8s.
COUNTY OF COOK )

IN THE CIRCUIT COURT OF COOK COUNTY,

ILLINOIS

COUNTY DEPARTMENT, CHANCERY DIVISION

LAKE SHORE AUTO PARTS CO.,)
an Illinois corporation, on its own
behalf and also as representative of
a class of corporations and other
“non-individuals,” which class is
herein described,

Plaintiffs

VS.

BERNARD J. KORZEN, County
Treasurer and ex-officio“County Col
lector of Cook County, GEORGE E
KEANE and HARRY H. SEMROW
Members of the Board of Appeals of
Cook County, P. J. CULLERTON
County Assessor of Cook County,
EDWARD J. BARRETT, County
Clerk of Cook County, and ROBERT
J. LEHNHAUSEN, Director, De-
partment of Local Government Af-
fairs of the State of Dlinois,

L TO. 70 CH 5123

Defendants. |

A44
ORDER

This cause coming on to be heard upon the Motion fy
Summary Judgment of LAKE SHORE AUTO PART
CO., an Illinois corporation, plaintiff, by and t
its attorneys, ORLIKOFF, PRINS, FLAMM & SUSMAN,
and upon the Cross-motion For Summary Judgment of
defendant ROBERT J. LEHNHAUSEN, Director, D,
partment of Local Government Affairs of the State of
Illinois, by and through the Attorney General of Illinois,
and the Cross-motion For Summary Judgment of defend.
ants KORZEN, KEANE, SEMROW, CULLERTON ani
BARRETT, assessing and taxing officials of Cook County,
by and through the State’s Attorney of Cook County,

The Court having examined the pleadings and memo.
randa filed by the parties hereto, having heard the argu.
ments of counsel and being fully advised in the premise

DOES HEREBY FIND:

1, That there is no genuine issue as to any material
fact in this cause, and it is therefore appropriate and
proper that the cause be determined on the Motion and
Cross-motions For Summary Judgment. ‘

2. That the plaintiff, LAKE SHORE AUTO PARTS
CO., is a corporation duly organized and existing under
the laws of Illinois, and on April 1, 1970, was the owner
of personal property having a taxable situs in the Com.
ty of Cook, which property has been included on the as-
sessment role now being prepared by the assessing off-
cials of Cook County Yor the tax year 1970; that the
plaintiff has standing to bring this action on its own be
half, and it is not at this time necessary or appropriate
to determine whether the action is properly brought and
maintained as a class action or to determine the defii-
tion of the plaintiff class.

A45

3 That an amendment to the Illinois Constitution of
1870, designated as Article [X-A, was approved by the
people of Illinois at a referendum held on November 7,
1970, and such amendment, by its terms, became effec-
tive January 1, 1971; that said Article [X-A purports to
prohibit the taxation of personal property by valuation
as to “individuals’’, and only as to “individuals”, while
leaving unaffected those provisions of the Illinois Consti-
tution and the Revenue Act of Illinois (Ill. Rev. Stat.
1969, ch. 120, § 482 et seq.) which impose such personal
property taxes as to property owned by corporations and
other “non-individuals”.

4, That said Ariticle IX-A is self-executing, and the
necessary effect of the adoption thereof is to amend the
various provisions of the Revenue Act of Illinois, speci-
fically including.but not limited to § 18 thereof (Ill. Rev.
Stat. 1969, ch. 120, § 499), so as to exempt from personal
property taxes thereby imposed all personal property
owned by “individuals’’, while retaining such taxes as to
personal property owned by corporations and other “non-
individuals.’’

5, That the Revenue Act of Illinois, as so amended by
Article IX-A of the. Illinois Constitution, deprives the
plaintiff corporation of the equal protection of the laws
guaranteed by the Fourteenth Amendment to the Consti-
tution of the United States; that said Revenue Act of
Illinois, to the extent that it purports to impose person-
al property taxes with respect to the property owned by
plaintiff is therefore unconstitutional, void and of no ef-
fect whatsoever.

6. That Article IX-A of the Illinois Constitution is

not applicable with respect to personal property taxes
imposed by the Revenue Act of Illinois for the year 1970,

A46

the assessment date for which was April 1, 1970, and th
assessment of which had been commenced prior to Janp.
ary 1, 1971, the effective date of Article [X-A, notwith.
standing that such assessment had not been complete
as of that date.

IT IS THEREFORE ORDERED, ADJUDGED AyD
DECREED THAT:

7. The plaintiff’s Motion For Summary Judgment js
granted in part and denied in part, the Court declaring
that the Revenue Act of Illinois (Ill. Rev. Stat. 1969, ch,
120, §§ 482 et seq.), said Revenue Act having been
amended by Article IX-A of the Illinois Constitution, is
violative of the Fourteenth Amendment to the Consti.
tution of the United States and is held to be void and
unenforceable insofar as said Revenue Act purports to
impose personal property taxes on plaintiff.

8. The defendants’ Cross-motions For Summary Judg.
ment are granted in part and are denied in part, the
Court declaring that Article IX-A of the Illinois Consti.
tution is not applicable to, and does not impair the col.
lection of, personal property taxes imposed by the Reve.
nue Act of Illinois, the assessment of which were com-
menced prior to January 1, 1971.

9, Except for those matters adjudicated by par.
graphs 7 and 8 of this Order, this Court retains jurisdic.
tion of this cause for all purposes.

10. Pursuant to Rule 304(a) of the Rules of the Su.
preme Court of Illinois, the Court expressly finds that
there is no just reason for delaying enforcement or ap
peal of this Order. In the event of an appeal from this
Order, the Court is of the opinion that the interests of
justice would be best served by hearing and deciding the

SSS SS

Se Fakp .tae poe HE RE

A47

appeal as expeditiously as possible because of the mani-
fest public importance of the issues and the substantial
amount of tax revenues that are involved.

| DATED: , 1971.

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Judge, Circuit Court of Cook
County, Illinois.

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FILED

JAN 6 1977

3n the E. ROBERT SEAVER, C

Supreme Court of the United Statez

No. 71-674

LAKE SHORE AUTO PARTS CO., an Illinois Corporation, on its own
behalf a8 representative of a class of corporations and other

Appellant and Petitioner,

vs.
J. KORZEN, County Treasurer and ex-officio
of Cook County, GEORGE M. KEANE and HARRY
SOW, Members of the Bowd of Appeals of Gok Satin 5

IN, County Assessor of County, EDWARD J.
BARRETT, County Clerk of Cook County, and ROBERT J. LEHN-
HAUSEN, Director, Department of Local Government Affairs of the

Appellees and Respondents.

No. 71-685

ROBERT J. LEHNHAUSEN,
Petitioner,
vs.

LAKE SHORE AUTO PARTS, et al.
Respondent.

No. 71-691
EDWARD J. BARRETT, County Clerk of Cook County, Illinois, et al.,
Petitioners,
vs.

CLEMENS K. SHAPIRO, et al.,
Respondents.

CONSOLIDATED MOTION TO STRIKE AND BRIEF
IN OPPOSITION TO CASES 71-674, 71-685, 71-691 OF
RESPONDENTS, EUGENE L. MAYNARD, PROVISO
TOWNSHIP HIGH SCHOOL DISTRICT #209, BELL-
WOOD GRADE SCHOOL DISTRICT #88, CICERO
GRADE SCHOOL DISTRICT #99, and RIVER GROVE
GRADE SCHOOL DISTRICT #851, all in Cook County,
Illinois.

ANCEL, STONESIFER & GLINK WITWER, MORGAN & BURLAGE
CEL SAMUEL W. WITWER

LOUIS AN! A
STEWART H. DIAMOND 141 W. Jackson Boulevard
111 W. Washington Street Chicago, Illinois 60604
, Illinois 60602 Tel. (312) 427-8750

The Scheffer Press, Inc—ANdover 3-6850

Statement of the COE accssiconecons

Opinions Below . sista’ nnd

_

II.

BRIEF IN OPPOSITION TO PETITION FOR
A WRIT OF CERTIORARI BY ILLINOIS
ATTORNEY GENERAL ON BEHALF OF A
STATE OFFICER — DOCKET NO. 71-685.

* . e

THE FINDING OF THE ILLINOIS SU-
PREME COURT THAT CORPORATIONS
MAY NOT CONSTITUTIONALLY BE SIN-
GLED OUT FOR AD VALOREM PERSONAL
PROPERTY TAXATION IS NEITHER NOV-
EL NOR ERRONEOUS AND IS NOT, ALONG
WITH THE RULES OF CONSTRUCTION OF
ILLINOIS LAW WHICH EXPOSES THAT
INFIRMITY, A PROPER SUBJECT FOR A
GRANT OF REVIEW UNDER CERTIORARI
JURISDICTION. ...

BRIEF IN OPPOSITION TO PETITION FOR
A WRIT OF CERTIORARI BY STATE’S AT-
TORNEY OF COOK COUNTY ON BEHALF
OF COUNTY OFFICERS— DOCKET NO.

71-691.
* * *

THE ILLINOIS CONSTITUTION OF 1970,
EFFECTIVE JULY 1, 1971, MADE NO
CHANGE IN THE CRITERIA GOVERNING
DECISION OF THIS CASE. THE ILLINOIS
SUPREME COURT DID NOT IGNORE OR
OVERLOOK THE NEW ILLINOIS CONSTI-
TUTION BUT CORRECTLY CONCLUDED
THAT THE BASIC FEDERAL QUESTION,
INVOLVING VIOLATION OF THE EQUAL
PROTECTION CLAUSE, REMAINED UNAF-

FECTED BY THE NEW CONSTITUTION. .... 20

ii
PAGE
III. MOTION TO DISMISS AND BRIEF IN OPPo.

SITION TO PETITION OF LAKE SHORE
AUTO PARTS CO.— DOCKET NO. 71-674,

WHERE A LITIGANT CONCEDES THAT
ITS CLAIM OF UNCONSTITUTIONALITY
HAS BEEN CORRECTED BY THE DECL.
SION OF A STATE SUPREME COURT AND
BENEFIT HAS THEREBY BEEN BROUGHT
TO THE LITIGANTS CLASS, A FURTHER
APPEAL SHOULD NOT BE GRANTED ON
THE SOLE GROUND THAT A FINAN.
CIALLY MORE BOUNTIFUL RESULT Ig
SOUGHT. ossessssscsssssssrsssssssssnsssessseseesssttsssieecs., %

TABLE oF CasES
Aberdeen S. & L. Ass’n v. Chase, 289 P. 536 (Wash.

TN) esses capansenspceescoeteatvsstenseensesteatovealevapsesieessesecdessectetaciece 1!
Allied Stores of Ohio, Inc. v. Bowers, 358 U.S. 522
Anderson v. Martin, 375 U.S. 399 ( 1964) oes 5
Avery v. State of Georgia, 345 U.S. 559 (1953) ........... 31
Bromley v. McCaughn, 280 U.S. 124 (1929) oooceeccccccme 13
Cramp v. Board of Public Instruction, 368 U.S. 278

CMON eats tecteats rsceepsaiesnees costes versssveassacceoedemnmreecesntesiene 18, 19
Dombrowski v. Pfister, 380 U.S. 479 (1965) -.ccceeccccccssose 3
Evans v. Selma Union High School Dist., 222 P. 801

RY css sa cesses remecretgpeecens se scescbisecsiaiaseaticns 31
First National Bank v. Ayers, 160 U.S. 660 ( 1896) ........ 19

Flint v. Stone Tracy Co., 220 U.S. 107 (1911) ...cccsssen 14,15

iti

PAGE
Freedman v. Maryland, 380 U.S. 51 (1965) «0... 35
Gamble-Robinson Fruit Co. v. Thoreson, 204 N.W. 861
(ND. 1925) ssessssssssssessesceeecessensnunsnsnansnannnnecnnecnensanansnsnseee 11
Garysburg Mfg. Co. v. Pender County, 42 F.2d 500
(ELD.N.C. 1930) ..sssssscssssssssnssnsssesesscseeceesenscnnnunnnansssseeeseee 13
Gomillion v. Lightfoot, 364 U.S. 339 (1960) ......-..--sssee 31
Griffin v. California, 380 U.S. 609 (1965) ......-.--rrssseeeceee 35
Grifin v. County School Board, 377 LL. Sh |. goemreenee 31
Harman v. Forssenius, 380 U.S. 528 (1965) .........-.-0+ 35
Henry v. Mississippt, 379 U.S. 443 (1965) .....-ssssesssseeseees 18
H. Roww Co. v. Texas Citrus Comm’n., 247 S.W. 2d 231
(Tex. 1952) ..escssssscsssccneeseneessneesnessnneessssssnessnssssneessnecsenesesse 13
Illinois Chiropractic Society v. Giello, 18 Ill.2d 306
(1960) .a.ssccooesessosssssssssosscenscessescennecsnscssnnecsvsesenesessessessssaneseescs 25
In re Petraeus, 86 P.2d 343 (1939) ......... caeunioeerasseucensies 31
Jackson v. Pasadena, 382 P.2d 878 (1963)... 31
Karlson v. Murphy, 387 Ill. 436 ..........sccssesesssesesseessesnenenees 33

Kedroff v. St. Nicholas Cathedral, 344 U.S. 94 (1952).. 18
Keyishian v. Board of Regents, 385 U.S. 589 (1967) ..... 35

Madden v. Kentucky, 309 U.S. 83 (1940) .........esscscsseeees 18
Mount Hope Cemetery Co. v. Pleasant, 32 P.2d 500
PRs LOGE) sseeesace ses et acters etterercersnrctarteerererenneereeens 13
Mulkey v. Reitmam, 50 Cal. Rep. 881 ..........sscsseseseeeeeeeeee 32
Near v. State of Minnesota, 283 U.S. 697 (1931) .......... 31
Northern Pacific Ry. Co. v. Sanders County, 214 P. 596

(Mont. 1923) .cccccccccscssssssssssecsssecsesecssscssssssvnsssssesssseeeesenees 11

lv

Northwestern liar Co. v. State, 220 baad ry
(N.D. 1928) NOE |
Palmer v. Thompson, ........ [tf - Seen , 91 1 BCE 1940
URE EY sestctaeesteeerinisesiesnaccseests ioesecteenonenneensoanenn ae |
Quaker City Cab Co. v. Pennsylvania, 277 U.S. 389...
soos sessseeesnsssssrsseerssneeeesesnersl ly 12, 13 17
Redfield v. Fisher, 292 P. 813 (Ore. 1980) ...eeccccccm.. ll
Reitman v. Mulkey, 387 U.S. 369 (1967) oo... 31,2
San Mateo County v. Southern Pacific R. Co., 13 Fed,
FA LR soretasristiycentasevtinsgeteicisiesvesicensseciiviinenmnes 9, 10,19
Santa Clara County v. Southern Pacific R. Co., 18 Fed,
BB5 (18GB) eesssscsccsssessessessessesessesstsserssssssssssssttsssicsesse, 9,10,1
Scripto, Inc. v. Carson, 362 U.S. 207 (1960) .. on JB
Select Base Materials v. Board of Education, § 395, "
Em EIDE iaicsicecteststttteereseeenenentioennstiiiincens: 31
Shapiro v. Thompson, 394 U.S. 618 (1969) oo... %
Shelton v. Tucker, 364 U.S. 479 (1960) .occceccecccecccssoseemes 4
Smith v. People, 361 U.S. 147 (1959) ..ceecccccseccsscsssmme 5
Snowden v. Hughes, 321 U.S. 1 (1944) coececcceccccsscsssme 2
State ex rel. Northern Pacific Ry. Co. v. Dumcan, 219
P. 638 (Mont. 1923) oo. cccsescscsceeeeees ll
State v. Hunt, 9 N.E. 2d 676 (Ohio 1937) ......ccccsessosvessen a}
Thorpe v. Mahin, 43 Tll.2d 36 (1969) .o...cccscccesscssseessssnen 14,15
Time, Inc. v. Hill, 385 U.S. 374 (1967) %
U.S. v. Jackson, 390 U.S. 570 (1968) ... %

Village of Glencoe v. Hurford, 317 Tl). 203 ceccccccccsmmmn %

v

Walker v. Birmingham, 388 U.S. 307 (1967) .......s00
Walker v. Northern Pacific Ry., 47 Fed. 681 (C.C.N.D.

891) ... . 11
Wheeling Steel Corp. v. Glander, 337 U.S. 562 (1949) ..9, 13

WHYY, Inc. v. Borough of Glassboro, 393 U.S. 117

(1968) ssseevsssossssescenssssensnsnessennnsescssnnsssrenanecernnnnesssssnnessecsnnenecs 14

Wiemann v. Updegraff, 344 U.S. 183 (1952) ........02+. 34
Seconpary Sources

Cooley on Taxation (4th ed.) 9
Excise, License and Other Taxes, 103 A.L.R. 18 ............ 13
McLaughlin, The Court, the Corporation and Mr.

Conkling, 46 Am. Hist. Rev. 45 (1940) .........s.ssscsssessees 9
Netsch, Chicago Bar Record (Nov. 1970) p. 114............ 24
Sholley, Corporate Taapayers and the Equal Protec-

tion Clause, 31 Ill. L. Rev. 463 (1937) 9

LULA ESE SURE Ste NR LOONIE he LER TAA
* !

In Tue .
SUPREME COURT OF THE UNITED STATES

— —~ —
— — — ——

No. 71-674

LAKE SHORE AUTO PARTS CO., an Illinois Corporation, on its own
behalf and also as representative of a class of corporations and other
“non-individuals”, .

Appellant and Petitioner,

ty Treasurer and
Collector of Cook County, GEORGE M. KEANE and
SEMROW, Members of the Board of A als of Cook County, P. J.
IN, County Assessor of k County, EDWARD J.
BARRETT, County Clerk of Cook County, and BERT J. LEHN-
HAUSEN, Director, Department of Local Government Affairs of the

State of Illinois,
Appellees and Respondents.
No. 71-685
ROBERT J. LEHNHAUSEN,
Petitioner,
vs.
LAKE SHORE AUTO PARTS, et al.
Respondent.
No. 71-691
EDWARD J. BARRETT, County Clerk of Cook County, Illinois, et al.,
Petitioners,
vs.
CLEMENS K. SHAPIRO, et al., 4
Respondents.

CONSOLIDATED MOTION TO STRIKE AND BRIEF
IN OPPOSITION TO CASES 71-674, 71-685, 71-691 OF
RESPONDENTS, EUGENE L. MAYNARD, PROVISO
TOWNSHIP HIGH SCHOOL DISTRICT #209, BELL-
WOOD GRADE SCHOOL DISTRICT #88, CICERO
GRADE SCHOOL DISTRICT #99, and RIVER GROVE
GRADE SCHOOL DISTRICT #851, all in Cook County,
Ilinois.

_e

ae

STATEMENT OF THE CASE

This brief, being a motion to strike and a brief ip op.
position to petitions for writs of certiorari, is file by
Kugene L. Maynard, a citizen and taxpayer of Cook
County, Illinois, and four public school districts in Cook
County, Illinois, Proviso Township High School District
No. 209, Bellwood Grade School District No. 88 Cicer
Grade School District No. 99, and River Grove Grade
School District No. 85-14. These respondents, hereinafter
referred to as the “Maynard respondents” were plaintiff;
in a declaratory judgment action filed by leave of the
Illinois Supreme Court as a matter of original jurisdiction,
That case was consolidated along with two other case
raising the same or similar issues. The three cases wer
argued together, and the Illinois Supreme Court issned ,
single opinion. The caption of those consolidated cases iz
the Illinois Supreme Court was as follows:

No. 44199

LAKE SHORE AUTO PARTS CO., an Illinois Corporation, on its ow
behalf and also as representative of a class of corporations
“non-individuals”, which class is herein described,

Members of the Board of of Cook County, P. J. CULLERTON,
Assessor of Cook ty, EDWARD County

Clerk of Cook County, and ROBERT J Director,

Department of eS

Appeal from the Circuit Court of Cook County, Llinois,
County Department, Chancery Division.

ae a ae ee oe oe ee

e-_ = —-.h[h6h—= ae aa

a Se See

———

SUGENE L. MAYNARD, PROVISO TOWNSHIP HIGH SCHOOL
MISTRICT #209, BELLWOOD GRADE SCHOOL DISTRICT #88,
PICERO GRADE SCHOOL DISTRICT #99, and RIVER GROVE
GRADE SCHOOL DISTRICT #85-1/2, all in Cook County, Illinois,

—_———
——_—

ARD J, BARRETT, County Clerk of Cook County; BERNARD J.
MEORLEN, County Treasurer and ex-officio Coun Collector of Cock

|

Original Proceeding Relating To Revenue.

—_

No. 44432
CLEMENS K. SHAPIRO; JEROME HERMAN, d/b/a THE SPOT; GUY
$. ROSS AD SE D. ge gt ad S. ROSS & CO., a
partnership; . WEIL AND +» an Illinois Corporation,
all individually and in a representative capacity,

EDWARD J. BARRETT, County Clerk of Cook County; BERNARD J.
KORZEN, County Treasurer —. ex-officio Coun lector of Cook

the Board ls of Cook County; P. J. CULLERTON, County
Assessor of County, and ROBERT J. LEHNHAUSEN, Director,
Department of Local Government Affairs of the State of Illinois,

———_
——___—

Appeal from the Circuit Court of Cook County, Tax Division.
Honorable THOMAS C. DONOVAN, Judge Presiding.

Plaintiffs- Appellants,

The Lake Shore Auto Parts case is before this Court as
Docket No. 71-674 on a request for an appeal and a peti-
tion for a writ of certiorari. The Attorney General of the
State of Illinois, the adverse party to Lake Shore in the
lower proceedings, also seeks a writ of certiorari (Docket
No, 71-685). The State’s Attorney of Cook County has
sought a writ of certiorari in the Shapiro case (Docket No.
71-691). The Maynard respondents were the only parties to
the previous litigation who urged the unconstitutionality

SPL TET ET LT AI BEES NE os

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40386414_0103%3A05. Public record. Not legal advice.