Carle Foundation v. Cunningham Township, 2017 IL 120427

Background

The Carle Foundation sued state and local taxing authorities seeking charitable-use property tax exemptions for four hospital-related parcels for tax years 2004–2011.
Before 2004 the parcels had exemptions under §15-65(a); the Cunningham Township assessor terminated those exemptions beginning in 2004.
While litigation under §23-25(e) was pending, the General Assembly enacted §15-86 (a hospital-specific exemption) in 2012, prompting dispute whether §15-86 or §15-65 governed plaintiff’s claims and whether §15-86 applied retroactively.
The circuit court decided §15-86 applied, then plaintiff added Count II (a standalone declaratory-judgment count) seeking a declaration that §15-86 governs and obtained summary judgment plus a Rule 304(a) finding (no just reason to delay appeal).
The Fourth District reversed, holding §15-86 facially unconstitutional; the Supreme Court granted review but held the appellate court lacked jurisdiction because the Rule 304(a) order resolved an issue ancillary to the exemption claims, not a separate claim.
The Supreme Court vacated the appellate decision and remanded, declining to reach §15-86’s constitutionality (refusing supervisory review) to avoid piecemeal appeals and because nonconstitutional grounds may resolve the case first.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether the circuit court’s Rule 304(a) certification made the §15-86 declaratory judgment immediately appealable	Count II is a separate declaratory-judgment claim under the DJA and thus a distinct claim warranting Rule 304(a) appeal	The count merely decided the governing law for the underlying exemption claims and thus was an issue ancillary to those claims, not a separate claim	Held: Not appealable under Rule 304(a); the order resolved an issue ancillary to the exemption claims, so appellate court lacked jurisdiction
Whether a standalone declaratory-judgment count that only declares which law will govern pending claims is proper	Count II properly seeks a binding declaration under the DJA construing applicable statute	Count II fails DJA requirements: not an actual controversy; does not terminate any claim; brought to obtain interlocutory appeal (procedural tactic)	Held: Count II is not a proper declaratory-judgment action because it did not present an actual, terminating controversy and was intended to facilitate piecemeal appeal
Whether the appellate court could reach §15-86 constitutionality under this record	Plaintiff urged immediate review to resolve constitutional question and streamline litigation	Defendants also sought definitive ruling on §15-86; both asked Supreme Court to address merits if jurisdiction lacking	Held: Supreme Court declined to reach constitutional merits under supervisory authority to avoid piecemeal litigation and because nonconstitutional issues (e.g., count I resolution) might moot the constitutional question
Whether prior adjudication via cross-motions converted the issue into a separate claim	Plaintiff argued prior cross-motions and court rulings made the statutory-governing-law question ripe and separate	Defendants argued prior cross-motion resolution showed the question was litigated as an issue ancillary to ongoing claims, confirming it is not a separate, appealable claim	Held: Prior cross-motion litigation confirmed the governing-law determination was an ancillary issue, not a distinct claim for Rule 304(a) purposes

Key Cases Cited

In re Marriage of Leopando, 96 Ill. 2d 114 (1983) (distinguishes single-claim ancillary issues from separate claims for Rule 304(a) purposes)
In re Marriage of Best, 228 Ill. 2d 107 (2008) (recognizes separate declaratory claims can be independently appealable when distinct from another statutory cause of action)
Blumenthal v. Brewer, 2016 IL 118781 (2016) (clarifies that orders disposing only of issues ancillary to a claim are not appealable under Rule 304(a))
Marlow v. American Suzuki Motor Corp., 222 Ill. App. 3d 722 (1991) (construes DJA phrase "some part thereof" to mean entire claim, not element of claim)
In re Estate of Funk, 221 Ill. 2d 30 (2006) (discussion of supreme court supervisory authority)
In re E.H., 224 Ill. 2d 172 (2007) (courts should avoid constitutional rulings when nonconstitutional grounds resolve the case)