A Cook County judge recently denied the village of River Forest’s request to throw out a lawsuit by Keystone Montessori, while also denying an injunction submitted by the private school, upholding the village’s right to continue to collect property taxes as debate over the nonprofit’s right to seek tax-exempt status continues in the Cook County Circuit Court. 

“We are very pleased that our complaint against River Forest was validated by the court. This gives us further confidence that we are doing the right thing to support our school and the students and families of Keystone,” Vicki Shea, Keystone’s director, said in a statement.

Keystone filed its lawsuit against the village on March 6 in the Cook County Circuit Court, alleging River Forest officials said they would only approve the school’s zoning permit if Keystone agreed never to seek a property tax exemption. The lawsuit claims its agreement with the village contravenes public policy and constitutes unconstitutional condition, illegal contract zoning, illegal perpetual contract and equal protection violation. The school is asking for reimbursement for attorneys’ fees, $1.1 million in property taxes it said it has paid over two decades, and an end to its agreement with the village.

In the motion to dismiss, filed March 20 in the federal district court in the Northern District of Illinois, the village argued the charges should be thrown out because Keystone knowingly signed an agreement to contract away its rights and that its federal and state complaints were untimely. 

A federal judge dismissed Keystone’s suit against the village in July, ruling that the nonprofit private school’s right to seek tax-exempt status is rooted in the state tax law, not the U.S. Constitution. 

In a statement, the village said it was “pleased” Judge Sanjay Tailor denied Keystone’s request for an injunction on Sept. 20, which would have prohibited the village from enforcing the property tax agreement as legal wrangling continue. 

“The village will continue to defend the agreement, which has been in place for 20 years,” the village said in a statement. “Keystone Montessori has experienced significant financial troubles unrelated to its agreement with the village, and the village remains ready and willing to help it relocate its school to a suitable location so it may continue educating children.” 

In March, Busey Bank filed to foreclose on the school’s more than $2 million mortgage, according to records from the Cook County Recorder of Deeds.

Attorney John Mauck, from the Chicago-based Mauck & Baker firm that is representing Keystone, has said that if the nonprofit school can break its agreement with the village, and become tax-exempt, Keystone will be solvent and able to pay its mortgage and other obligations. The school pays about $100,000 annually in real estate taxes, and has not paid its 2017 taxes yet, Mauck said. He said the school had been relying on private donors to help pay the taxes, but this past year donors stopped giving.

“When a motion to dismiss such as this is denied, it means that the judge feels all the matters alleged in the complaint create valid claims,” Mauck said in a statement. “Because the judge upheld the complaint, and because River Forest repeatedly conceded that no substantive factual issues are disputed, we feel that Keystone is in a very strong legal position.”

The matter will continue Nov. 7 at the Cook County Circuit Court.

CONTACT: ntepper@wjinc.com

In an original article published on Sept. 26, Wednesday Journal failed to mention the judge denied an injunction submitted by Keystone Montessori. We regret this error. 

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